SPECIAL AREAS

 In Project Management and Construction Engineering, there are some

concerns that need particular handling. Discussed are: engagement
and managing consultants; risk management; conflict management;
common project implementation problems; lease or buy options;
computer applications for Project Management; rehabilitating “sick”
projects; and standard construction forms.
CONSTRUCTION MANAGEMENT
AND ENGINEERING
CONSULTANCY SERVICES
Consultants

 A consultant is an individual or a firm who is able to provide special professional

or expert advice in one or more specialized fields and has wide knowledge of
such project matters.
 A consultant usually works for consulting firm or is self-employed and engages
with a single client or multiple and changing clients. A consultant can be
engaged in-house depending on the arrangement with the employer
 The Need for Consultants
 The need for consulting services happens when a company or a government
institution does not have the necessary expertise of its own. Specifically,
consultants are involved when –
a) there is urgency of a task to be completed and this is for a limited period of
time;
b) expertise desired is not readily available within the company;
c) expertise or technology is not available locally;
d) there is a need to enhance or build the capacity of an organization;
e) cost is an issue or when hiring consultant with proven tract record is
cheaper than using existing expertise; and
f) special documents and policy paper are needed by a financial institutions
and similar agencies.
 TYPES OF CONSULTANTS
 Consultants are classified as follows:
a) Individual Consultants – Hired for a highly specialized field. Only one person
is needed for the assignment and does need any other expertise.
b) Freelance Consultant – One who works for several consulting firms for
various parallel projects but within his capacity to deliver results without
sacrificing quality.
c) Civil Engineering Consulting Firm – A business partnership that specializes
on civil engineering works and services.
d) Multi-disciplinary Consulting Firm – A business corporation that specializes
on several areas including civil engineering, finance, management, policy
studies, training programs, implementation supervision services, feasibility
studies and project packaging.
e) Staff Consultants – Usual used financial or lending institutions to
augment their in-house staff. These consultants posses highly
specialized fields and knowledgeable to operations of lending
institutions. These could be freelance consultants or consultants from
consulting firms.
f) Non-Government Organizations – NGOs are usually used by donor
countries as they are related to a specific concern like grassroots
approaches and connections. Most often, NGOs work in a clearly defined
area of work and specific tasks.
g) Resource Persons – These are high caliber persons with distinguished
experiences who are hired to present papers in national and
international conferences. Sometimes resource persons act as a
conference or workshop facilitators that provide guidance during session as
well as synthesizes results of conferences and workshops.
SERVICES RENDERED BY CONSULTANTS

 The services may be Advisory, Supervisory, Implementation Management and/or

Operation and Maintenance.
 Presented hereunder are the general areas of services rendered by consultants.
a) Project Preparation
- Project Proposals
- Feasibility Studies
b) Project Appraisal
c) Design Services
- Concept Design
- Preliminary Design
- Detailed Design
- Construction Drawings
d) Technical Specifications
e) Quantity takeoff and Cost Estimating
f) Procurement
g) Construction Project Management (including supervision)
h) Project Management per se
i) Project Safety
j) Financial and Accounting Services
k) Environmental and Social Impact Studies
l) Preparation of Documents like Contract Documents or Bidding
Documents and Training Kits
m) Conduct of Training Programs
n) Policy Studies
o) Strategy Formulation
 PREPARING A CONSULTING SERVICES
CONTRACT
 Steps followed in engaging consultants are enumerated and defined below.
1. Consulting Services Needs Assessment – The consultancy needs of clients are
identified and assessed.
2. Consultancy Outputs – Once the needs are established the expected outputs of the
consulting engagement is determined.
3. Scope of Work – The meat and bounds of the consulting package is developed. The
tasks to be performed by consultants ae identified.
4. Implementation Schedule – The time schedule to perform each task is estimated.
This is usual presented in tabular form and in Bar Chart.
5. Consultants Requirement – The types and number of consultants needed for a
certain project are identified.
6. Terms of References – The TOR spells out all pertinent information necessary for
the consulting project. These include objective, scope of services, consultants
needed (type and number), Implementation plan, Reporting Requirements and
Consulting Fees and out-of-pocket expenses.
 SECURING CONSULTING CONTRACTS

 Consulting Contracts may be secured through

a) Invitation
b) Advertisements
c) Referrals by profession groups and international funding institution
d) Sub-contracting
 METHODS OF SELECTING

CONSULTANTS
Using the Asian Development Bank’s “Consulting Services Operations Manual”
as a reference, there are 6 methods for selecting consultants, namely:

a) Quality and Cost-Based Selection (QCBS) – Technical and Financial Proposals

are submitted at the same time. Technical Proposal is evaluated first and
participating firms are ranked. It is at this stage that some firms are dropped for
not achieving minimum number of points. Qualifying firms advance and their
Financial Proposals are opened and ranked with the lowest proposal receiving
highest number of points . Points received from the Technical and Financial
Proposals are tabulated, and the firm that received higher number of points is
awarded the consultancy contract provide negotiation was successful.
b) Quality Based Selection (QBS) – Technical Proposal is superior over cost, hence,
even if a firm submits lowest bid but not best in technical proposal, contract will
not be awarded. Projects using this method are usually complex or highly
specialized.
c. Fixed Budget Selection (FBS) - Firms are informed in advance of the possible
contract amount. Any firm submitting higher than the maximum amount is
dropped. Projects using this method have fix budget. TOR are detailed and
precise.
d) Least-Cost Selection (LCS) – Technical Proposals are evaluated and considers
qualified firms. The qualified firm’s Financial Proposals are evaluated and ranked.
Lowest bidder is awarded the contract.
e) Consultant’s Qualification Selection (CQS) – This method is used for short term
assignments related to review of designs of projects, emergency relief, project
evaluation, review of safety programs and the like. Specialized expertise is
necessary.
f) Single-Source Selection (SSS) – This method is exceptional and used only in
emergency cases, small amount is involved and if there is inevitable
continuation of an existing project.
 PROCESS OF SELECTING CONSULTANTS

 Given the above-mentioned methods of selecting consultants, the general

process of selecting consultants is synthesized as follows:
a) Prequalification
b) Short-Listing of Consultants
c) Request for Proposals
d) Submission of Technical and Financial Proposals
e) Evaluation of Proposals
f) Negotiating Contract
g) Notice of Award
h) Commencement of Consulting Services
Supervising Consultants
 Consultants commence to work after the issuance of the “Notice to Proceed” by
whoever is the employer (private or government). The consultants will then
prepare an Inception Report usually demanded by the TOR. Periodic
Consultant’s Progress Reports are submitted. Contents are based on the
activities and results derived from observations and findings from the project.
Ultimately, consultants undertake billing and request for payment. Once the
project comes to an end, consultants have to prepare a “Final Consultant’s
Report” or “Project Completion Report”.
 Consultants be monitored properly by project owners. Special attention should
be made on practicability, reasonable and cost-effectiveness of consultants
recommendations. There should also be periodic meetings between project
owners and consultants.
 Periodic Consultant’s report should be required by the owner. The manner the
Consultants handle construction disputes and arbitration, including the method
of identifying and solving problems, should be monitored by the owner.
CONCLUSION

 The use of consultants increases a Project Owner’s level of confidence to

successfully implement a project.
 Consultants are hired because of their proven expertise and specialization.
 Project proponents and owners hire Consultants if there are project components
that could not be done in-house.
 Qualified Consultants deliver results as they are trained to analyzed results,
innovative and created in crafting their recommendations, wide experiences on
similar situations demanded in projects, and resourceful to secure facts related
to a certain project.
 Experienced Consultants relates well with contractors and the external
environment of the project.
 RISK MANAGEMENT

 Since construction realities are unique and peculiar, the successful completion
of a project largely depends upon the proven ability of the project/construction
manager to identify these risk factors. Once they are identified, the project
consultant must provide the guidelines that will guarantee that the contractor
can meet his work schedule from day to day. Usually, these risk that lead to cost
overruns and work slippages, result mainly from bad planning and poor
monitoring of construction activities.
 Risks answer the question “What can go wrong?” Risk are identified and
managed. Risks can be classified under the following categories:
1. Property (theft, fire)
2. Liability (loss of existing assets, files/records or future income)
3. Personal (loss of income-producing ability due to death, disability, sickness,
accident, or retirement)
 Further, Risk Analysis and Management entails the following:
1. Identification of Activities
2. Determination of the degree of seriousness (High, Medium, Low)
3. Ranking of the probability (High, Medium, Low) of occurrence of risks
4. Formulations of actions to be taken
a. Preventive
b. Interim
c. Contingent
d. Remedial or Corrective After undertaking risks assessment, key mitigating
measures are determined and applied.
 Managing the risks ca be undertaken in various ways, namely:
1. Situation Analysis
2. Problem Analysis
3. Decision Analysis
 On the other hand, the Decision Making process generally entails the following
steps:
 Statement of the Problem/s
 Objective (Quantity, Quality, Delivery, Profitability)
 Areas of Consideration or Areas of Concern
 Analysis
 Alternative Courses of Action
 Conclusion
 Recommendation/s
 Action Plan
Also, there are certain rules of thumb in taking or absorbing risks, viz:
1. Don’t risk more than you can afford to lose.
2. Don’t risk a lot for a little.
3. Consider the odds.
 CONFLICT MANAGEMENT
 Construction disputes and conflicts occur occasionally at various levels among
construction project participants due mainly to: misunderstanding between or
among the project players; varied interpretation of the contract stipulations;
human factors (difference in personalities or characters); delays in construction;
inadequate or lack of funds; delay in getting approvals; and political intervention.
 Internal settlement of disputes and/or conflicts without any external
intervention is still the best method in resolving conflicts. If inevitable,
government intervention through Mediation or Arbitration can be an option.
 Mediation means a “voluntary process in which a mediator, selected by the
disputing parties, facilitates communication and negotiation, and assists the
parties in reaching a voluntary agreement regarding a dispute.
 The concerned government agency tasked to handle Mediation and Arbitration
is the Construction Industry Arbitration Commission (CIAC).
CIAC has developed Cost Arbitration Process Flow Charts covering:
a. Filing of Request for Adjudication (RFA) to commencement of Proceeding
b. Arbitration Proceedings (with and without hearings) Shown in the figure are the
Flow Charts for easy reference.
 LIST OF COMMON PROJECT
IMPLEMENTATION PROBLEMS
 Below is a list of problems from previous projects and experienced by many project
and construction managers.

 In organizing and Staffing

1. Delay in obtaining approval of an organizational structure
2. Lack of qualified technical personnel
3. Difficulty in recruiting qualified personnel due to poor pay or absence of proper
incentives
4. Political interferences in the appointment of project staff and workers
5. Weak or inappropriate organizational structure
6. Staff appointed for project implementation are not being involved in the preparation
of the project
7. Poor quality of workmanship
 In Procuring Goods and Works
1. Lack of suitable expertise for procurement
2. Complex and cumbersome procurement procedure
3. Problems in understanding or adhering to the Bank’s requirements/guidelines for
project funds derived from bank loans
4. Difficulties or delays in obtaining approvals from top management
5. Rigid government procurement regulations/rules
6. Failure of supplier to comply with the provisions of contracts
7. Cost overruns

 In construction Management
1. Delay in providing engineering designs
2. Changes in work specifications/contract conditions
3. Poor quality of contractor’s work
4. Financial problems on the part of the contractor
5. Right-of-way problems
6. Security problems at project site
7. Technical problems
8. Poor working conditions at project site
9. Far location of quarry site (Gravel, Sand, Boulders)
10. Inadequate or wrong type of equipment
11. Labor problems
12. Delay in reimbursing contractor’s expenditures and payment of billings
13. Poor communication
14. Political intervention
15. Insurgency
16. Inadequate service vehicles
17. Billing and Collection
18. Unclear Rules and Regulations (Labor)
19. Limited Suppliers of construction material
20. Delays due to shipment of materials
21. Testing of Materials
22. Inadequate and Under-capacity of subcontractors
23. Project Safety/ Accidents
 LEASE OR BUY OPTIONS
 Heavy equipment and support vehicles are inevitable for huge and complex
projects (i.e., high-rise buildings, roads, bridges, dams). A decision is reached
only after considering several factors, to wit : costs (first cost, recurrent costs
vis-à-vis lease cost), duration of use (short-or-long-term), urgency of need,
availability of financing and capacity to obtain loan, and cost recovery.

 Leasing is advantageous to the contractor if:

a. there is a shortage of funds to buy new or used equipment;
b. there is only one specific project and if there is no immediate or next projects in
the near future (In this case, lease cost will just be part of the construction cost);
c. contractor is not too keen on periodic maintenance and repairs of the equipment
or support vehicles, as well as if the contractor is not in storing spare parts which
will entail inventory cost; and
d. contractor has no yard to store the equipment and support vehicles after their
use.
Buying new equipment and support vehicles is advisable if:
a. the contractor has available funds to buy the equipment and support vehicles on
the premise that the contractor cab use them more than once;
b. the contractor can acquire loan from lending institutions provided, however, that
the contractor has funds to provide for the equity (usually 10% of loanable
amount) or has ample tract record on banking transactions;
c. the contractor has greater control and flexibility in undertaking his projects; and
d. the contractor has multi-year projects and if there are other pipeline projects
wherein the equipment and support vehicles will be needed.
 COMPUTER APPLICATIONS FOR PROJECT
AND CONSTRUCTION MANAGEMENT

 There are several computer softwares available that focus on Project

Management. The objectives of these softwares are: to assist the project
managers and project engineers in developing work plans and schedules; to
track down progress of work including slippages of project activities causing the
adjustment of time schedules; appropriate; manage budget; and analyze the
workloads. These software cover principally project scheduling, budget
management, cost control, resource allocation and documentation.
 The more commonly used softwares are:
a. Microsoft Project or MSP or Winproj
b. Primavera Contractor
 HOW TO REHABILITATE “SICK” PROJECTS
THROUGH PROPER MANAGEMENT SYSTEMS

 “Rehabilitation” as it used in this context means the necessary improvements to be

done in an existing project that is in bad shape. A “sick” project is one that is
afflicted with numerous technical, management and financial problems.
 “Sick” projects can be classified into three types.
1. Projects that are affected by the economic and financial crises during the latter part
of the 1990s, which saw their complete closure and which stagnated for 2 years or
more before they re-opened for rehabilitation. This is the most sick type in terms of
deterioration because they were left entirely to the mercy of elements without any
effort expended in preserving the quality of the completed works, or in preventing
them from further deterioration by proper maintenance
2. Projects that are operationally stopped upon the issuance of the court’s temporary
restraining orders (TRO) and the subsequent litigation between owner and the
contractor for contract violations both; also, for non-compliance with plans and
specifications by the contractor and non-payment of claimed accomplishments. The
project is the sure loser where the court battle is a long-drawn affair.
3. Projects that the contractor have to abandon due to financial losses resulting
from abnormal slippages and sub-standard materials and poor workmanship,
which often lead to a take-over of the project by the owner or the awarding of
the project to another contractor deductible from the original contractor’s
contract. The usual cause of this project abandonment is the under-bid price of
the winning contractor coupled with managerial and technical incompetence.
3 GENERAL ROOT CAUSES OF “SICK”
PROJECTS
1. Incomplete Plans and Specifications and their Manifold Revisions.
More often that not, the consideration of project has started with incomplete plans,
construction drawings and specifications, usually without the necessary details.
Moreover, these said plans are issued to the field on a piece-meal basis in the
course of construction.
2. Unreasonable Project Cost Award.
Bidders and the owner are not on equal footing when it comes to the bidding of
projects. It is to be expected that where the contractor has to make do with a
contract price that the owner ha squeezed dry, the former may eventually be
compelled to cut corners when and where possible by scrimping on materials,
underpaying the workers and sacrificing quality to survive.
3. Practice of Undercutting on Professional Fee.
As project owners, nowadays, recognize and accept the importance of the services
of project/construction managers as their best assurance of getting their money’s
worth, many firms and professional groups have mushroomed in the playing field
dominated by a few smart operators. Unfortunately, they resort to unethical ways
to corner crowded market for premium projects.

 In summary, if the plans and specifications including details are complete and
the owner gives the reasonable pricing for the construction contract, the
construction and completion of the project is assured of an honest-to-goodness
compliance with the approved plans and specifications, time schedule, budget
cost and quality standards.
 STANDARD CONSTRUCTION FORMS

 More organized and systematic construction companies must develop FORMS

appropriate to their operations. Forms have multiple usages such as: records
transactions; serves as bases for monitoring , evaluation and review; reference for
planning future projects; and an element of data management.
 Almost all items of work require a Form. Enumerated hereunder are some examples.
 Work Plan Schedule
 Bill of Quantities
 Materials Canvass Sheet
 Purchase Order
 Requisition Slip
 Materials Withdrawal Slip/Materials Issuance Slip
 Inventory Control: Warehousing; Inventory of Material, Parts, etc.
 Cash Flow/Budget
 Cash Voucher
 Cash Advance Liquidation Report
 Payroll
 Logbook
 Administrative: Attendance Sheet; Office Supplies; Gasoline/Oil Consumption
Request; Leaves (Vacation, Sick) Credits and Balances
 Security: Gate Passes, Spot Reports, Incident Report
 Project Safety
 Project Completion Report Form
 Project Acceptance Form
THANK YOU
for
Listening!!!