Construction

Management
ENGR.M.ABUBAKAR TARIQ|
Introduction
INTRODUCTION TO CONSTRUCTION MANAGEMENT
History
Cliff Palace
Construction, in one form or the other, has been practiced since the dawn of civilization.
About 2 million years ago, humans began to produce identifiable tools, thus construction had its
rudimentary beginning at that point in the non-literate ages of human antiquity when humans
built their first shelter.
Civilizations are built by construction efforts. Each and every civilization of the past had a
construction industry that fostered its growth.
The emerging efforts of humans are recorded by constructed systems such as works to bring
water to the population of a city. The purpose of those built systems and structures is to support
our civilization. Such systems and structures, built in the past, provide a historical record of how
engineering and structures have developed.
Cliff Palace and Balcony House in Mesa Verde National Park.
Balcony House
History
Even in ancient times, man created architectural marvels, which came to be regarded as the wonders
of the world. These includes Pyramids of Egypt, the Great Wall of China, Taj Mahal etc.
The Pyramid of Giza in Egypt contains more than 2,000,000 blocks, with an average weight of 2.3 tons
each, 100,000 persons worked on the pyramids for three to fourth months a year to build it in about
20 years.
The Great Wall of China built to provide protection against surprise enemy raids, is about 6400 km
long, its height and width at the top varies from 5 to 10 m. It has 20 m high towers.
The medieval times witnessed the construction of marvels like Taj Mahal in India and the Leaning
Tower of Pisa in Italy.
A more recent example of man’s achievement in this direction is the Burj Khalifa in Dubai, one of the
world’s tallest buildings.
History
In the Indian context, people were familiar with construction using burnt bricks as far as back as
2600 BC.
The township of Mohen-jo-daro and Harappa provided its citizens with the comfort and luxury
that was unheard of in the other parts of the world during those days.
The strength, symmetry and aesthetics of Qutab Minar in Dehli prove beyond doubt that the
Indians of 13th century were familiar with nuances of construction.
The Taj Mahal, completed in 1653, is an outstanding example of architecture.
Under the British regime, some of the most challenging construction are undertaken-
construction of light railway lines in 1845, construction of the first railway bridge over Thane
Creek in 1854, construction of Ganges Canal consisting of main canals and distribution channels
between 1842 and 1854 etc.
Nature of Construction Industry
Construction industry is one of the largest industries in the world.
Construction professional sometimes argue about whether the construction industry is a service
industry-just as management consulting, health care, and automobile repair- or goods-
producing industry.
The Bureau of Labour Statistics (part of Department of Labour of USA) classifies construction as
a goods-producing industry to separate it from the services industry.
Nevertheless, there are certain segments of the construction industry that are services
businesses; for example, designers who complete studies and designs for clients are providing a
service.
Contractors who build facilities are producing a product, just as an automobile maker or
furniture manufacturer is providing a product.
Nature of Construction Industry
The most significant differences between construction industry and most other product
industries are the size and cost of the product, and its customer-designed, one-of-a-kind
features.
The automobile maker and the furniture maker develop their design, produce their products,
and make them available for customers who want to purchase them. Customers may specify
colors and extra features in automobiles or the fabrics to be used on a piece of furniture, but the
basic product is not eligible for complete redesign or customization.
The product required by any construction contract is also a manufactured product: a building,
road, factory, residence, office building built in response to the needs of the customer.
Contractors must service the needs of their customers, but the product of construction is not a
service, it is a product, properly built in accordance with the plans, specifications, and
expectations of the owner.
Breadth of Construction Industry
Worldwide, construction industry accounts for more than $4 trillion of in place work annually.
The construction industry is so large and so multifaceted that it may be better to described as a
sector of the economy instead of an industry.
Construction includes more than just the work of building structures on a construction site.
It includes the engineers and architects who do the design work, the manufactures and
distributors of the materials and equipment that go into the structures, the construction
managers who manage the site work, the unions and tradespeople who do the work, the
municipal officials who review plans and enforce the building codes, the workers at concrete
batch plants where concrete is proportioned for delivery to the construction site, the workforces
in manufacturing facilities assembling prefabricated components that are used in many
buildings, and many, many more participants.
Pre-eminence of Construction Industry
Construction is an integral part of infrastructure such as houses, offices, townships, schools, hospitals, urban
infrastructure (water supply, sanitation), highways, ports, railways, airports, power, irrigation, industrial
infrastructure and so on.
Construction is recognised as a basic input for socio-economic development.
It generates substantial employment, not only employ engineers, managers and skilled workers, but also
unskilled male and female workers from rural and urban areas.
Many people, organizations, regulating agencies and governments are affected by construction project
success or failure.
The growth of construction industry propels growth in other industries as they are interlinked. For example,
construction industry contributes in the development of building materials industry and construction
equipment industry. The demands for cement, steel, paints, chemicals, aluminum, glass etc., from
construction industry provides positive impetus to the growth of these industries.
In general, the construction industry of a country depicts the health of the economy of the country, and it is
imperative that the industry should be properly nurtured for the growth of the overall economy.
World Famous Construction Projects
The following table shows world famous landmarks, construction in the recent
past.
World Largest Projects and Programmes
In the present day, technological breakthroughs have revolutionised construction activity.
Modern construction areas include high-rise buildings, dams and irrigation networks, energy
conversion and industrial plants, environmental protection works, infrastructural facilities roads,
bridges, railways, airports and seaports, satellite launching stations, onshore and off shore oil
terminals, etc.
A glimpse of the famous construction-related international programmes, valuing US$5 billion
and above, as mentioned in Engineering New-Record (ENR) Facts, 2003, are listed in the table
below:
High-Tech Construction Technology
Construction activity started when the caveman learnt to build his dwelling using stones.
The performance enhanced gradually with the slow pace of evolution of technology of levers,
wedges, wheels, rollers and pulleys.
The industrial revolution 1800s enabled the builders to use stream-operated tools and
machinery like cranes, hoists, dozers, excavators and shovels to partly replace the human
muscles and the load carrying animals.
In the twentieth century, the electrical technology and the internal combustion engines replaced
steam engines with more efficient devices that resulted in the emergence of high-tech plants
and mobile machinery.
Construction Scope
The market of the construction business includes both international as
well as domestic markets.
Its profitability, like any other business, fluctuates according to the law of
demand and supply.
International Export Market:
According to ENR, there are about 225 top international companies that
compete with each other for the global construction tenders. Despite
some upheavals and uncertainties, the world construction market showed
a gradual rise in revenue from 2002 to 2011. Since the beginning of the
new millennium and up to year 2011, the international construction
market, ranged between 116 billion to 450 billion dollars per annum.
Construction Scope

Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

US$ 116.5 139.8 167.5 189.4 224.4 310.3 382.4 383.4 383.7 453
Billion

Global market of top 225 international companies (revenues US$ in

Billions)
Construction Scope
Global Infrastructure Market:
The global market (demand) over the next 20 years for infrastructure is forecasted to be US$65
trillion.
China is the largest infrastructure market in the world accounting for 40% of global
infrastructure demand.
Over the next few years, growing markets for infrastructure are Brazil, India, Indonesia and
Turkey, which is expected to account for around 20-25% of the world market.
The US infrastructure market is about 15% of the world market.
Infrastructure projects are key drivers of economic growth.
Construction Scope
Domestic Infrastructure Market:
Strong economies are spending huge money to develop and upgrade their domestic
infrastructure market.
The most critical short term barriers to economic growth are absence of world-class
infrastructure (power in particular).
Focus on quality and efficient infrastructure services is essential to realise the full potential of
the growth impulses surging through the economy.
India is now emerging as the third largest economy in the world next to the US and China but
inadequate infrastructure is dragging down India’s economy growth.
Organization of the Industry
There are many ways to describe the categorization of the construction industry. One way is to
organize the industry around four types of construction projects as given below:
1. Residential construction
2. Commercial construction
3. Industrial construction
4. Heavy/Highway Construction
Owners who expect to earn profit from the constructed facility usually build first three types of
projects.
On the other hand, to fulfill a social need, the government usually builds the last category.
Residential Construction
This category includes contractors and developers who build individual homes,
apartments, and assisted living facilities.
Builders of individual homes generally falls into two categories:
◦ those who build custom homes individually suited to the buyer’s needs and
◦ of tract homes (a house forming part of a housing estate), offering standard
deign and floor plans, and a limited number of options and upgrades.
Residential construction is generally not bid work.
Builders of custom homes and apartments negotiate a price with the owner.
Developers of tract homes set the price on market conditions.
Commercial Construction
Included in this category of construction are the office buildings, stores, schools,
libraries, and other type of buildings except homes that make up the built
environment.
Projects in this category range in size from small convenience stores to
multimillion-dollar office buildings.
Both private owners and government owners contract for buildings in this
category.
Private owner generally negotiate the price of the buildings, while the
government agencies normally use a low-bid process.
Industrial Construction
Examples of industrial facilities include manufacturing plants,
refineries, pipelines, electricity-generating facilities, and high-tech
facilities, such as hospitals and clean rooms.
Contractors who do this kind of work are specialists in the kind of
projects they undertake, and they normally negotiate the price of
the work.
Heavy/Highway Construction
In addition to highways, this category includes structures such as dams, canals,
water and waste water treatment projects, bridges, rail roads and tunnels.
This kind of work is usually awarded by low bid.
Usually the owner is a government agency.
For some projects, owners prefer to prequalify bidders, meaning that
contractors can bid only after they have submitted to a prequalification process
to demonstrate their experience, qualifications, technical and managerial
expertise, and financial capacity for the project.
Public and Private Works
Another way to categorise construction is to divide it in public and private work.
The type of owner, public or private, is key because of the procurement procedures and regulations
that encumber the public process but have no application to private projects.
Public work is the work that is done using the public’s money. It includes government at all levels,
including federal, provincial and local. It may also include different regulating agencies/
environmental protection groups. Projects in this case must be awarded to the lowest responsible
and responsive bidder.
There is only one prescribed way to open bids, and exceptions are not allowed. There are strict rules
that govern how projects are advertised. Anyone who can provide a bid bond is allowed to bit unless
the project requires contractors to prequalify. There are generally hundreds of such rules and policies.
They apply to all the construction of infrastructure and other facilities needed by the general
populations.
Public work receive more publicity as taxpayers money is involved.
Public and Private Works
In case of private work, a private person(s) or an organisation(s) is/are spending
their own money.
They are not as encumbered by bureaucracy and rules.
They may open bids in any way they select or award it to their favourite
contractor without even advertising.
Horizontal and Vertical Construction
Third way in categorizing the construction industry is horizontal and vertical construction.
In this categorization, the terms horizontal and vertical describe the direction of the
construction.
Example of horizontal construction projects include roads, bridges, dams-those projects that are
parallel to the horizon.
Examples of vertical construction includes schools, shopping centers, skyscrapers-those projects
that tend to rise out of the ground.
Typically, the type of construction, horizontal or vertical, indicates who the lead designer is, with
engineers leading the design team on horizontal type projects and architects leading the design
team on vertical-type projects.
Project Participants
Owners:
No construction would ever be accomplished without owners who make decisions to make the
facility, define the need and provide financing.
Owners can be public (governments) or private.
Most private owners have little or no construction management expertise and depend on
consultants to help them through their projects.
Besides providing the project funding, the primary responsibility of the owner is to define the
scope of the work.
General Contractor
Projects are awarded to general contractor (GC) who manages the project, and subcontracts
portions of the work, such as electrical, plumbing etc. to subcontractors or specialty contractors.
The primary job of the general contractor is to manage the job, keep it on schedule, control
costs, ensure the work is well coordinated and performed in a safe manner, and coordinate with
owner on all matters since the GC is the only one of the contractors holding a contract.
Subcontractors or Speciality Contractors
Subcontractors or speciality contractors make up the largest portion of the construction industry
they do the work.
All subcontractor have a specialty such as electrical, plumbing, steel erection, painting or
carpeting etc.
The construction of a typical building may require 20 or more subcontractors.
Designers, Architects and Engineers
Project owners select an architect or engineer (A/E) to design their projects.
The designer will prepare the construction documents (blueprints/drawings, specifications,
contracts) for the project owner.
Architects are usually the lead designers for buildings-vertical construction. They subcontract
some of the work, such as the structural frame and mechanical/electrical/plumbing (MEP)
systems, to engineers who specialize in such work.
Engineers are normally the lead designers for heavy civil and highway projects-horizontal
construction. They subcontract part of the work such as train stations or office buildings to an
architect.
Designers, Architects and Engineers
Role of Engineer:
Generally, the term “engineer” means consulting engineer.
He/she provides technical service on behalf of client.
The consultant is also referred to as “Construction Management Consultant”, “Construction
Supervision Consultant” or “ Project Management Consultant”.
The nature of services offered by these consultants varies from project to project.
Furthermore, the position, role, responsibilities and duties of an engineer differ greatly across
countries, as one may well imagine.
However, in general, they are responsible for undertaking project feasibility study, preparation of
cost estimate, geo-technical investigation, reviewing and coordinating engineering drawings,
helping client in bidding process, and coordinating in execution phase of the project.
Construction Managers
During the 1970s, the term construction manager became popular.
Unfortunately today, construction manager has many different meanings.
Some engineering and architectural firms offer construction management
services, Indicating usually that they represent the owner during construction.
To make the definition more difficult, there are some government agencies that
have employees who are construction managers.
Not all people who call themselves construction managers work for a
construction contractor.
Suppliers
Everything on a construction project, from concrete to paint, comes from suppliers.
Many suppliers assist designers in material and equipment selection and then assist the
contractors in preparing bids, preparing shop drawings, and fabricating items specifically for
individual projects.
It is equally important to ensure the quality of a construction projects by using a quality supplier.
Permitting Agencies and Building
Authorities
Permitting agencies and building authorities represent the interests of public
safety.
They administer publically funded construction projects and they ensure private
construction projects comply with zoning laws and building codes.
Insurance Companies
Contractor are required to provide bid bonds as a condition of being allowed to
bid, and then they must provide insurance, performance bonds, and payment
bonds prior to award the contract.
Insurance companies provide bid bonds and performance and payment bonds,
and property insurance needs of contractors.
Banks
Banks provide working capital to contractors so the contractor can pay for materials, labor,
equipment and overhead expenses until the contractor is paid by the owner.
Contractors earn their progress payments (usually monthly), and no-up-front payments are
made by the owner.
Banks also provide both short-term and long-term financing to the project owners.
Public
The public is impacted by every construction contract and those impacts can be good and bad.
The American public enjoys the best quality highways, residences, offices, infrastructure, and
public facilities in the world.
Public is one of the most important stakeholder in the infrastructure projects.