CONTRACT AND PROJECT DELIVERY METHOD STRATEGIES

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Questions and Answers

What is the role of Ernie Becklesten in the Avocet Island Project?

Owner (correct)

Track Designer

Main Contractor

Project Manager

Which role is primarily responsible for design aspects within the Avocet Island Project?

Contractor

Owner

Designer (correct)

Project Coordinator

What is a factor that the Project Delivery and Contract Strategy (PDCS) Tool assesses?

Employee satisfaction

Owner's reputation

Preference weights (correct)

Market conditions

How does the project delivery method impact the project?

Affects contractual relationships Signup and view all the answers

Which of the following is NOT a selection criterion for the project delivery method?

Labor market trends Signup and view all the answers

What is the primary focus of the PDCS Tool when evaluating decision-making alternatives?

Project’s objectives and execution environment Signup and view all the answers

Which role is assigned as the main contractor for the Avocet Island Project?

Monisha Klarewill Signup and view all the answers

What might changes to the project delivery method influence?

Cost modifications Signup and view all the answers

What is the primary legal feature of a construction contract?

It outlines roles, responsibilities, and is legally binding. Signup and view all the answers

Who typically selects the contract type for a construction project?

The owner, guided by engineers and legal advisors. Signup and view all the answers

Which of the following is NOT a commonality addressed in built environment projects?

Establishing unachievable requirements. Signup and view all the answers

What supports project objectives and details project constraints?

Contract type considerations. Signup and view all the answers

According to the Engineering Joint Contract Documents Committee, what does a construction contract delineate?

Roles, responsibilities, and work specifics. Signup and view all the answers

What is a key consideration when closing out a contract?

Verifying project alignment with initial objectives. Signup and view all the answers

Which phase directly follows contract proposal processing in project management?

Contract execution. Signup and view all the answers

What role do engineers and legal advisors play in contract type selection?

They provide advice to the owner for selection. Signup and view all the answers

What is the primary method used for establishing payment in a time and materials contract?

An agreed hourly or daily rate Signup and view all the answers

Which factor is considered when an owner selects a contractor?

The contractor's bid rating Signup and view all the answers

What does the owner do after prequalifying a subset of bidders?

Negotiate with the lowest bid submitted Signup and view all the answers

What defines the selection criteria used by the owner when identifying contractors?

Competitive bid ratings and qualifications Signup and view all the answers

What type of contract agreement is secured based on the best value bid?

Negotiated agreement Signup and view all the answers

In the bidding process, what is the first step taken by the owner?

Identifying selection criteria for bidders Signup and view all the answers

What is a significant disadvantage of a time and materials contract?

It can lead to unlimited costs without a cap Signup and view all the answers

What is the goal of the owner when selecting bidders?

To negotiate the most competitive bid awarded Signup and view all the answers

What is the purpose of indemnification in a contract?

To allocate risks associated with uncertain work conditions Signup and view all the answers

Which of the following best describes liquidated damages?

A pre-determined amount of money for specific breaches Signup and view all the answers

When considering project delivery methods, which criterion is most important?

The complexity and scale of the project Signup and view all the answers

What is typically included under the 'sufficiency of contract documents'?

All necessary information for project execution Signup and view all the answers

Why might delaying events in a project be considered a risk?

It can lead to increased project costs and extended timelines Signup and view all the answers

What is a key feature of the design-build (DB) project delivery method?

Combines the designer and contractor into one unit Signup and view all the answers

Which project delivery method emphasizes collaboration and shared ownership of risk?

Integrated project delivery (IPD) Signup and view all the answers

In the construction manager at risk (CMAR) method, what is the role of the construction manager?

To oversee the project and provide a guaranteed maximum price Signup and view all the answers

Which contract type requires design to be completed before construction begins?

Design-bid-build Signup and view all the answers

What is a defining characteristic of the build-operate-transfer (BOT) method?

The project is transferred to the owner after construction and operation Signup and view all the answers

What does the professional construction manager (PCM) do in project management?

Coordinates design and construction efforts Signup and view all the answers

In which delivery method does the owner appoint a construction management entity?

Construction Manager at Risk (CMAR) Signup and view all the answers

Which statement accurately describes the design-bid-build project delivery method?

The construction phase can only start once the design is fully approved Signup and view all the answers

What is one of the risks associated with poorly defined contract types?

Increased costs and time delays Signup and view all the answers

What is a common misconception about risk allocation in contracts?

It is generally not necessary to allocate risks Signup and view all the answers

What risky practice might owners and contractors engage in regarding insurance compliance?

Passively reviewing certificates of insurance Signup and view all the answers

What might happen if general conditions in contracts are not clearly defined?

Increased chances of claims and disputes Signup and view all the answers

What is a consequence of improperly managing pricing risks in contracts?

Underbidding to win contracts Signup and view all the answers

What is a potential issue stemming from increased contract complexity over time?

Challenges in managing arising risks Signup and view all the answers

What is a consequence of assuming costs in a contract?

Less accountability for the owner Signup and view all the answers

What can lead to misaligned incentives among contract parties?

Improperly defined contract types Signup and view all the answers

Study Notes

Construction Contract and Risk Management

This presentation covers contract and project delivery strategies for construction projects.
The whole is greater than the sum of its parts (Aristotle). This means that understanding the connection between project parts is key to effective project management.

Project Delivery Methods

Project delivery method defines contractual relationships, so selecting the correct method is critical.
The process needed to execute and complete a construction project
This requires reviewing various project delivery methods and introducing different contract structures.

Project Delivery Method: Selection Criteria

The criteria for selecting a project delivery method include:
- Budget
- Design
- Risk
- Schedule
- Owner expertise

Project Delivery Method: Impact

Establishes engagement
Affects contractual relationship
Influences ownership
Impacts changes and modifications to cost

Project Delivery and Contract Strategy (PDCS) Tool

A quantitative assessment of 12 decision-making alternatives
Focuses on the project’s objectives and the execution environment

Project Delivery Methods - Specific Methods

Presentation listed several project delivery methods including:
- Design-bid-build (DBB)/traditional
- Design-build (DB)/turnkey
- Construction manager at risk (CMAR)
- Job order contracting (JOC)
- Multiple-award task order contract (MATOC)
- Construction management multi-prime (CMMP)
- Public-private partnership (PPP or P3)
- Integrated project delivery (IPD)
- Build-operate-transfer (BOT)
- Professional construction management (PCM)

Contract Types/Structures

These are the different ways contracts are structured
- Lump sum
- Cost plus a fee
- Guaranteed maximum price (GMP)
- Unit price
- Admeasurement contract
- Target cost contract
- Time and materials (T&M)

Contract Award Method

Negotiated selection:
- Owner identifies an entity to hire.
- Owner negotiates a mutually accepted agreement directly.

Contract Risks

Built environment contract risk refers to any potential for loss at any time.
Some risks include:
- Contract type and misaligned incentives among parties
- Increased contract complexity
- Inadequate insurance certificate
- Pricing risks
- Risks in general conditions of contracts
- Inappropriate risk allocation.

Common Disclaimer Clauses

Some common clauses in construction contracts that help mitigate risk include:
- Uncertainty of work conditions
- Delaying events
- Indemnification
- Liquidated damages
- Sufficiency of contract documents

Standard Form of Contract (SFoC)

Predetermined by authoritative bodies or alliances
Focuses on rights, obligations, and duties
Provides contractual guidance, and conditions

Purpose of an SFoC

Starting point for the contracting process
Customizable to suit project needs
Holds all contractual parties accountable
Allows owners to amend or adjust as necessary

Avocet Island Project

The slides include discussion points for the Avocet Island project concerning project delivery methods and contract type.
A map of the island was included
Questions included considerations for determining an appropriate delivery method and contract type.

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Description

This quiz explores the vital roles and tools involved in the Avocet Island Project. Test your knowledge on project delivery methods, contract strategy, and the key responsibilities of team members. Understand the legal aspects and criteria that influence construction contracts within the project.