SPEC B-2 Mod 1 PDF

A Partial Learning Module for PROJECT CONSTRUCTION AND MANAGEMENT (SPEC B-2) Prepared by: ENGR. NEIL SAMUEL G. SAMSON, M.Eng’g. Instructor II August 2024 Student’s Name Year and Section...

A Partial Learning Module for PROJECT CONSTRUCTION AND MANAGEMENT (SPEC B-2) Prepared by: ENGR. NEIL SAMUEL G. SAMSON, M.Eng’g. Instructor II August 2024 Student’s Name Year and Section 1 This material is intended exclusively for this instructor’s Fourth Year Bachelor of Science in Civil Engineering students in Project Construction and Management (SPEC B-2) for the first semester of Academic Year 2024- 2025. This material may subject for revision and updates any time the instructor deemed necessary. This material is for the intended student’s personal use only. This must not be reproduced in any form for any other intended purposes. INTRODUCTION TO PROJECT CONSTRUCTION AND MANAGEMENT Overview A project is a temporary endeavor undertaken to create a unique product, service, or result. Project Management Book Guide 6th Edition Temporary endeavor The temporary nature of projects indicates that a project has a definite beginning and end. The end of the project is reached when one or more of the following is true:  The project's objectives have been achieved;  The objectives will not or cannot be met;  Funding is exhausted or no longer available for allocation to the project;  The need for the project no longer exists (e.g., the customer no longer wants the project completed, a change in strategy or priority ends the project, the organizational management provides direction to end the project);  The human or physical resources are no longer available; or  The project is terminated for legal cause or convenience. Projects are temporary, but their deliverables may exist beyond the end of the project. Projects may produce deliverables of a social, economic, material, or environmental nature. To create a unique product, service, or result Projects are undertaken to fulfill objectives by producing deliverables. An objective is defined as an outcome toward which work is to be directed, a strategic position to be attained, a purpose to be achieved, a result to be obtained, a product to be produced, or a service to be performed. A deliverable is defined as any unique and verifiable product, result, or capability to perform a service that is required to be produced to complete a process, phase, or project. Project Management Book Guide 6th Edition 2 The Principal Three Components All three components of the project are of equal importance in the successful completion of a project. When a project is first assigned to a project manager, it is important that all three of these components be clearly defined.  SCOPE defines the work to be accomplished by the project. It should be the first task in the development of a project, prior to the development of either the budget or the schedule. Scope definition requires involvement by the project owner. Only the owner can describe the purpose and reasoning behind the project. The owner’s objectives act as inputs to developing the project’s scope.  BUDGETING is important because it establishes the amount of money the owner will spend to obtain the project and the amount of money that the design and construction organizations will be compensated for performing the work. Project cost overrun adversely affects profitability and creates adverse relationships between the parties.  SCHEDULING consists of two different activities. Planning is the first and most important and consists of identifying and organizing the work, detailing how the work will be performed and developing a logical sequence to accomplish to the work. The schedule is the final product of scope definition, budgeting, and planning and forms the base against which all activities are measured. Scheduling brings together project definition, people, cost, resources, and timing. Project tracking and control cannot be accomplished without a good plan and schedule. 3 Scope is the first component that must be developed because an accurate scope must be known before an accurate budget and schedule can be known. Any adjustment in the scope of work requires a corresponding adjustment in the budget and schedule. Just because scope should be defined first does not indicate it is more important than the budget and schedule. To illustrate, when a project with a well-defined scope is completed, but the final cost is extremely high (budget problem) and/or the completion date is extremely late (schedule problem), it is not a successful project. This principle applies between any and all of the three components of a project. Using project management processes and principles creates a dynamic binding force to keep balance between the three essential components. Quality Quality is meeting the needs and business (or agency) and facility objectives, and satisfaction of the ultimate end user of the project, the owner. Quality is an element that is integrated into and between all parts of a project: scope, budget, and schedule. Quality is the responsibility of all participants in a project, including all levels of management and workers in each of the principal parties. An attitude of collaboratively achieving quality must be instilled in everyone and perpetuate throughout the work environment. The attitude should be “what can we do to effectively execute our work and what is the best way we can deliver a project that meets the needs and objectives of the owner?” Project Management for Engineering and Construction: A Life-Cycle Approach, (2022) Project Management “A unique process, consisting of a set of coordinated and controlled activities with start and finish dates, undertaken to achieve an objectives conforming to specific requirements, including constraints of time, cost and resources” (Project Management Vocabulary). Project Management must meet three fundamental criteria: 1. The project must be completed on time; 2. The project must be accomplished within the budgeted cost; and 3. The project must meet the prescribed quality requirements. 4 These criteria can be graphically represented by the well-known project triangle. Some organizations like to substitute the word ‘quality’ with ‘performance’, but the principle is the same – the operational requirements of the project must be met, and met safely. PROJECT TRIANGLE In construction industry, the fourth criterion, safety, is considered to be equally important, if not more so. In these organizations, the triangle can be replaced by a diamond now showing the four important criteria. PROJECT DIAMOND While the other three criteria (Cost, Time, and Quality/Performance) can be juggled by the project manager to suit the changing requirements and environment of a project, safety cannot under any circumstances be compromised. As any project manager knows, the duration (Time) may be reduced by increasing resources (Cost), and cost may be saved by sacrificing quality or performance, but any diminution of safety can quickly lead to disaster, death, and even the closure of an organisation. 5 The four project management criteria in the order of their importance, the sequence would be Safety, Performance, Time, and Cost (SAPETICA). The rationale for this order is as follows:  If the project is not SAFE, it can cost lives and/or destroy the constructor and other stakeholders.  If the PERFORMANCE is not acceptable, the project will have been a waste of time and money.  If the project is not on TIME, it can still be a success, but may have caused a financial loss.  Even if the COST exceeds the budget, the project can still be viable, as extra money can usually be found. “The planning, monitoring, and control of all aspects of a project and the motivation of all those involved in it, in order to achieve the project objectives within agreed criteria of time, cost, and performance” (Albert L., 2014.) A project will not be successful unless all (or at least most) of the participants are not only competent but also motivated to produce a satisfactory outcome. Skills Required Many textbooks divide the skills required in project management into hard skills and soft skills. This division is not exact and some are clearly interdependent. Furthermore, it depends on the type of organization, type and size of project, and authority given to a project manager The hard skills cover such subjects as business case, cost control, change management, project life cycles, work breakdown structures, project organization, network analysis, earned value analysis, risk management, quality management, estimating, tender analysis, and procurement. The soft skills include health and safety, stakeholder analysis, team building, leadership, communications, information management, negotiation, conflict management, dispute resolutions, value management, configuration management, financial management, marketing and sales, and law. Project Management, Planning, and Control: Managing Engineering, Construction, and Manufacturing Projects to PMI, APM, and BSI Standards, 6th Edition 6  PROJECT LIFE CYCLE Project Lifecycle Following a project lifecycle aids in selecting the right project and develops it sufficiently to allocate the required human and financial resources Lifecycle processes act as risk mitigation by helping to scope the right project to satisfy the project sponsor’s intended use of the project (business or agency objectives) when the project is completed. Engineering and Construction For engineering and construction, the project sponsor may be a business in the private sector or an agency of a government. The private sector typically involves companies that provide a product or service for a profit. The public sector typically involves a governmental agency that provides services to benefit the general public. A Five-Phase Lifecycle For each phase, the stage gate is intended to act as a go/no go point in the project’s development. This allows the project sponsor and key decision makers an opportunity to confirm that the project continues to satisfy the business objectives and economic requirements. The gate between Detailed Scope and Detailed Design and Construction is a critical decision point. If a project receives a “go” decision here, capital funds are authorized, and a full project team effort can begin. The project is considered sanctioned. 7 The first three phases constitute what is often referred to as front end planning, front end engineering and design (FEED), or front end loading (FEL). Basically, front end planning is selecting the right project to perform, scoping the right assets for a good design basis, setting the stage for successful execution, and documenting the scope of work into an organized basis for design. Effort in the early phases establishes the triangle of scope, budget, and schedule. The purpose of the front end phases, those prior to funds authorization, is to adequately define the objective, scope, and execution approach for the project to warrant authorization of funds. Phase 1: Project Feasibility Initiating the project feasibility phase, including preliminary study development, ensures that an owner selects the best project (the right project), scopes and organizes the necessary components for a good design basis (the right assets, at the right cost, and right schedule) and paves the way for successful project execution (the right way). The early phases of a project (project definition) have the greatest impact on project success. Typically, the owner commissions a study, the owner’s study, to evaluate the feasibility of the desired project effort and its alignment with business strategy. It is an important study because the goals, objectives, concepts, ideas, budgets, and schedule that are developed will greatly influence the design and construction phases. The owner’s study must conclude with a well-defined set of project objectives and needs, the minimum requirements of quality and performance, an approved maximum budget, and a required project completion date. The thoroughness and completeness of the owner’s study has a significant impact on total project cost. Once an owner decides that a project is feasible, the project manager and project sponsor need to discuss an overall project strategy. Project strategy forms the framework for developing the project and is the basis for developing the project execution plan during the detailed scope phase. The project strategy will be subdivided into specific details of the project execution plan during the detailed scope phase. Phase 2: Conceptualization and Alternative Analysis The conceptualization phase evaluates and eliminates the various alternatives until the one alternative that satisfies the business objective can be selected. At this point, the nodes of the triangle, budget, schedule, quality, encompass a project scope. Conceptualization continues to establish those activities (the basic unit of workflow) that contain the deliverables (activity outputs) that form the basis of design for the project. 8  Based on the documented project objective and preliminary scope, alternatives are conceptualized. Each alternative is described with a scope overview, preliminary cost estimate, and high- level schedule. Risks for each alternative are identified. Key personnel or skills needed for the project are captured. Identifying and assigning the project manager during the conceptualization phase is a critical step for the project. Phase 3: Detailed Scope Definition The purpose of detailed scope definition is to provide sufficient information to identify the work to be performed, to allow the design to proceed without significant changes that may adversely affect the project budget and schedule. Detailed design requires a detailed scope that adequately defines deliverables, that is, what will be furnished and placed in the project manager’s hand. To accomplish this, the project manager from the design organization, and other functional leaders, must be involved early in the project. They will require input from experienced technical people to represent every aspect of the proposed project. An example checklist for detailed scope definition for a petrochemical project. 9 Experienced design and construction personnel can provide valuable input to assist an owner in the development of a checklist for project scope. A realistic budget and schedule cannot be determined for a project without a well-defined scope of work. Thus, the project scope should be developed first, then a project budget and schedule developed that matches the scope. Phase 4: Detailed Design and Procurement As a project makes it through approval decisions and enters Detailed Scope Development, the owner utilizes a design firm to develop preliminary designs, detailed scopes of work, estimates, schedules, and risk assessments. The third effort for which design firms are engaged is detailed engineering and design. Managing the design phase of a project is difficult because the work begins with limited information, only the information that was approved in the design proposal. The biggest concern with design coordination is that the owner and the design firm both understand the need for timely decision making; indecision is the costliest aspect of a project. Since the detailed design and construction of the project, project execution makes up the majority of the project time and cost; the detailed scope phase should produce the contracting and procurement strategies. Depending on the project delivery method, procurement may start during the design phase. 10  Contract strategy is key and identifies the overall organizational structure and the allocation of risk among the contracting parties. The type of contract chosen and contractors selected to bid the project influence cost, schedule, and quality. The project manager plays an important role in the process of qualifying contractors, the evaluation of bids, and recommendations of the award of construction contracts. Procurement is not restricted only to equipment. Procurement may also apply to long lead-time acquisition of bulk material or procurement of construction or specialty contractors. Phase 5: Construction and Close out For most projects, the owner assigns one contract to a prime contractor, usually called the general contractor, to accomplish the construction phase of a project. The objective during the construction phase is to build the project in accordance with the plans and specifications, within budget, and on schedule. The quality of the completed project is highly dependent on the workmanship and management of construction. This phase is where the details of the design become reality. Many resources are needed to accomplish the construction phase of a project. Resources include people, equipment, materials, and subcontractors. Project close out includes all of the activities in the project execution plan (PEP) to formally finish the project, including contractual obligations. In the final phase of a project lifecycle, close out includes start- up, often referred to as commissioning, final walk-through, and facility handover. Close out three broad areas: 1. Completing the actual construction work (start-up and handover), 2. Completing all of the documentation including as-built drawings and archiving documents, and 3. Closing the administrative aspects of the project (financial reconciliation, team dissolution, post project evaluation). The purpose of close out is to conclude all of the activities and contractual obligations associated with the project. 11 References: PM Book Guide 6th Edition Albert Lester (2014). Project Management, Planning and Control. Managing Engineering, Construction and Manufacturing Projects to PMI, APM and BSI Standards-Butterworth-Heinemann Oberlender, G., Spencer, G., Lewis, R. M., (2022). Project Management for Engineering and Construction: A Life-Cycle Approach 12