Intro Project Management

CONSTRUCTION PROJECT
MANAGEMENT
CCE 4031
Saleh Mubarak, Ph.D.
Summer 2020
Summer 2020 Intro to Construction Project Management 2
Engineering and Architecture

Building
Design
Architecture Engineering
Aesthetics Functionality Economy Safety
The balance of these three elements optimizes the

project based on the client’s needs and likes
The Game of Balance

• While safety is a “cut and dried” issue, architects and
engineers try to joggle aesthetics, functionality, and cost
• For example, the choice of a column section shape
• The owner, architect, structural engineer, and contractor

may have different preferences
• The load, height, and location of the column are major factors
• The owner makes the decision after considering the options, along
with their pros & cons, and the cost
The Game of Balance: Another Example

• The cantilever structure: The
architect’s favorite, the
structural engineer’s nightmare,
Construction
and the contractor’s challenge easiest
Design Optimum
Design-construction
compromise
Structural engineers
like this one most 
The Builder
• In the past, there was one person “the builder” who was in
charge of the entire design and building process
• Now, in order to safeguard the interest and welfare of the
client, and to eliminate any potential conflict of interest;
laws and traditions separate between the designer and
the constructor.
• Furthermore, the client may – and usually does – appoint a party to
supervise the construction process and make sure their interest is
being protected.
Architects and Engineers

• Architects fly high with their imagination and “inspiration”
• So engineers hold on to them and bring them back to
earth!
• We can’t live with them… We can’t live without them 
• What’s more interesting is owner’s decision: They like a

design but likely to change their mind when options are
explained by the engineer!
Engineering & Construction

• Engineering is primarily focused on design: Depending on
specialty (civil, mechanical, electrical, electronic,
aeronautical, marine, etc.)
• Construction is the execution of the completed design
according to the terms of the contract
Design Construction
• In the old times, the “builder” did the architecture,

engineering and construction!
What is a Project?
• Project: A temporary endeavor undertaken to create a
unique product, service, or result.
(Project Management Institute, PMI, PMBOK, 6th edition, 2017)
• There are no two projects that are the same

• Every project has
• A start point and a finish point, and
• A deliverable
What is Management?
• Management is the process of dealing with or controlling
things or people
• Types of Management
• Operations management
• General management
• Specialty management: financial, human resources, IT, etc.
• Program management
• Portfolio management
• Project management
• Specialty project management
What is Project Management?

• Project Management is the application of knowledge,
skills, tools, and techniques to project activities to meet
the project requirements.
• Accomplished through the appropriate application and
integration of the project management processes
identified for the project (initiation, planning, execution,
monitoring and controlling, and closing.) Project
management enables organizations to execute projects
effectively and efficiently.
Project Management Institute, PMI, PMBOK, 6th edition, 2017
What is Project Management?

• Project management is an experimental / empirical
science: observations, trial & error, and experts’ opinions.
In many issues, there is no unique right way to doing
things… however, there are always guidelines and
standards set by successful individuals and organizations
• Just keep in mind that there are many good rules but
there is no such thing as “one size fits all”. The industry is
so dynamic, and each project has its own characteristics
and conditions which make certain tools more effective
than others.
• And this may and does change with time…
Project Management versus Operations

Management
• Operations management is concerned with the ongoing
production of goods and/or services. It ensures that
business operations continue effectively by using the
optimal resources needed to meet customer demands. It
is concerned with managing processes that transforms
inputs (e.g. materials, components, energy, and labor) into
outputs (e.g. products, goods, and/or services).
Operations Management Project Management
Continuous inputs / outputs Start / Finish - Deliverable
Program Management
• Program: A group of related projects managed in
coordinated way to obtain benefits and control not
available from managing them individually. Programs may
include elements of related work outside of the scope of
the discrete projects in the program
• Programs may be:
• Temporary / one-time programs
• Ongoing (usually with periodic / annual milestones)
• A program can be a large and complex project

Program Management
• Program management is defined as the application of
knowledge, skills and principles to a program to achieve
the program objectives and to obtain benefits and control
not available by managing program components
individually.
• Project management focuses on interdependencies within
a project to determine the optimal approach for managing
the project. Program management focuses on the
interdependencies between projects, and between
projects and the program level to determine the optimal
approach for managing them.
Portfolio Management
• Portfolio is a collection of projects or programs and other
work that are grouped together to facilitate effective
management of that work to meet strategic business
objectives.
• The projects or programs of the portfolio may not necessarily be
dependent or directly related
• Portfolio management is the centralized management of
one or portfolios to achieve strategic objectives
Sub-project
• A subproject is a smaller portion of the overall project
created when a project is subdivided into more
manageable components or pieces.
• It is NOT a stand-alone piece of work regardless of size
• A project may be divided into subprojects based on:
• Specialization / responsibility
• Geography / location
• Phase
Sub-project
• A subproject is usually independently managed but it may
affect and/or affected by other subprojects in the overall
project.
• May even have smaller components; sub-subprojects
• In fact, a large / complex project may be divided into
subprojects or it may be considered a program with its
components as projects.
The Hierarchy
Portfolio Program
Sub-
Program Project Project Project Project Tasks Program
Subproject Subproject Subproject
Sub-sub- Task
project
Activity, Project, or Program?

Task / Work
Activity Package /
Project Program
Assembly
• What we do, falls under any of these…

or, in between them!
Example
• Program: Summer Olympic 2024 in Paris

• Project: Constructing a new building to house
athletes
• Subproject: Electrical work in the building project
• Work Package: Foundation or Roof assembly
• Activity: One spread footing
• Task/Step: Setting the formwork for the spread footing
Can the Following be Considered

Projects?
1. I like to improve my education
I plan to obtain my MBA from an accredited school by end of 2022
(you can put a max for the budget too)
2. I want to save a good amount of money
I will save (at least) $10,000 in 2 years
3. We like to reduce the overhead of our company
We like to reduce the OH from 22% to 18% by end of 2021
4. After a first disappointing year in college with a GPA =
2.1, you decided to improve your grades
My GPA will be at least 2.75 by the end of the second year
Exercise
1. Mention examples of:
A. A task
B. A project
C. A program
D. A subproject
2. Are the following tasks or projects, and why?
A. Obtaining a master’s degree
B. Changing a flat tire
C. Replacing your home carpet
D. Inventing a solar powered bicycle
The Construction Industry

• The construction industry represents a large component
of the national economy
• In the United States, as of January 2019:
• Value of Construction = $1.28 Billion
• Value of GDP (gross domestic product ) = $19.39 Trillion
• Construction = 6.6% of GDP
• From 1999 through 2015, real (inflation-adjusted) construction
investment varied from 5.1 percent of real GDP in 2010 and 2011
to 9.4 percent of GDP in 1999. In 2015 and 2016, construction
investment was 6.2 percent of GDP.
Source: https://www.abc.org/News-Media/News-Releases/entryid/9801/constructions-
contribution-to-u-s-economy-highest-in-seven-years
The Construction Industry, cont.

• In addition to the economic impact, the construction
industry touches the life of every person
• It is heterogeneous and complex
• It is comprised primarily of small companies, though there
are some very large companies
• Its projects vary from small to gigantic
What Makes Construction Projects

Unique?
1. Projects are intricate and involve many different
specialties (crews / subcontractors)
• New specialties are added as technology advances in materials,
equipment, and methods: Fire-fighting systems, conveyer systems,
communications systems, electronics, solar power, security
systems, CAD / BIM,
2. Projects take from a few weeks to several years to
complete, and cost up to billions of $
3. Projects live from years to centuries

Unique?
4. Projects are visible to and usable by the public
• You watch your project getting built: The excitement!
• They may become a source of pride for the designer or builder
5. Projects are unique, non-standard production, infinite

variability
6. Projects (while construction and after completion) are
subject to weather and climatic conditions
7. The “as built” rarely, if ever, matches the “as planned”

Unique?
8. Less “automation” and more “human touch” than most
other industries
9. There are many project risks that are usually distributed
among project stakeholders according the contract and
the local laws
10. Site safety is a major concern
• Hard to see all actions (unlike factories)
• The “macho image”
• The “Unbuckled Seatbelt Mentality Syndrome”
What is Construction Management

• The term “construction management” may
mean one of these two functions:
1. The management of the construction operations, Manage the
representing the party responsible for the construction
construction work, i.e. the general contractor, or work activities
2. The supervision of construction operations,

representing the owner / client. It can be: Make sure the
job is done right
A. A person / team working directly for the owner,
B. The design team rendering an additional service for
the owner, or
C. A 3rd party professional company (sometimes acting in
the role of the general contractor)
What is Construction Management

• As one of the most exciting, challenging, and rewarding
professions, construction management (CM) is a
professional service that uses specialized, project
management techniques to manage the planning, design,
and construction of a project, from beginning (pre-design)
to end (closeout).
• For all types of projects – large, small, vertical, horizontal,
domestic, or international – a construction manager
ensures the scope of work is skillfully adhered to, and the
project is successfully delivered.
Source: Construction Management Association of American, CMAA

https://www.cmaanet.org/about-us/what-construction-management
Contractor’s Construction Management

• Construction management from a general contractor’s
(GC) perspective is the overall management of the
construction operations; technical; administrative; and
other, in order to deliver the project to the client on time,
within budget, and in conformance with the specifications
and other contract terms.
• This undertaking must be done while taking care of the
welfare of the GC’s own organization in terms of
profitability, reputation, competitiveness, and long-term
success.
Is Construction Management a Science?

• Construction (construction management, construction
engineering, construction technology, building science,
etc.) has been regarded as a professional empirical
science: You just learn it from the practice with no need
for college education!
• This culture started changing since the middle of the 20th
century:
• Construction programs started appearing in schools under different
colleges; both as supplemental / elective courses, minors, and
majors.
• Construction professional continuing education also spread out
both qualitatively and quantitatively, especially with certification
requirements
Keep in mind….
Objective: Domain of Subjective:
Facts, no Knowledge Opinions,
opinions no facts
Only one Expert opinions, Many answers

correct best practices, to the same
answer to rules of thumb question; none
any question is “wrong”
Engineering Architecture
Empirical /
Experimental
Exact Sciences
Sciences
(math, Art
physics) Project
Management
Education versus Experience

Experience versus Education

• Experience tells you how but education tells you why.
• It is wrong to compare experience to education when it comes
to importance, as they complement each other
• This is specially important in applied sciences
• Experience is not experience!
• Experience without education may become just repetition: 25 years of
experience may be indeed one year, repeated 25 times
• In fact, it may become a barrier to advancement if you stick to the
mentality of “but we’ve been doing it this way for 20 years!”
• Some people pick exceptional cases when someone achieved
high professional success even though did not complete
his/her college degree: Scientific observations and rules are
based on the majority, not the exception!
Why Training / Continuing Education?

• In the USA (and some other countries), most professional
certifications have limited validity period (usually 2 years).
After that it needs to be renewed, which requires –among
other things- a minimum number of relevant and approved
Continuing Education Units (CEU’s)
• Why training / continuing education?
A. Because knowledge keeps advancing and changing
B. Because people may forget what they know
C. You can also pick up new skill or “support topics” (software, BIM,
etc.)
Types of Education
1. Academic education
2. Vocational education
3. Professional continuing education
4. “Life education”
• How do you evaluate the quality and impact of certain
educational event?
• Traditional or other?
• Self education? Online?
Professional Certification
• Professional certification combines education and
experience by requiring a minimum level of each, plus
passing a rigorous exam to prove proficiency
• But as knowledge and technology advances, the
professional should stay on top of things. Professional
certification needs to be renewed periodically (usually 2
years), and it requires –among other things- the
completion of a minimum number of hours of relevant
continuing education.
• Professional certification means its holder meets the minimum
requirements, but it does not guarantee good performance.
Project Management Institute, PMI

• “Founded in 1969, PMI delivers value for more than
2.9 million professionals working in nearly every
country in the world through global advocacy,
collaboration, education and research.”
• It has over 300 chapters around the world
• It provides a set of project management standards,
primarily the Project Management Body of
Knowledge (PMBOK)
• It also provides a myriad of professional services:
conferences, seminars (continuing education),
publications, and certifications
PMI Certification
• Types of certification: 6. PMI Agile Certified
1. Project Management
Practitioner, PMI-ACP
Professional, PMP 7. PMI Risk Management
2. Program Management
Professional, PMI-RMP
Professional, PgMP 8. PMI Scheduling
3. Portfolio Management
Professional, PMI-SP
Professional, PfMP • What is the objective,
4. Certified Associate in meaning, and importance
Project Management, of the certification?
CAPM
• Certification by other
5. PMI Professional in
Business Analysis, PMI- organizations: AACE
PBA International, CMAA
Construction Projects in the Past

Yes, they were great but…

• They represent less than 0.1% of construction projects of
those times
• What happened to the other 99.9%?
• The builders had almost unlimited resources

• But, in most cases, the life of the builder was on the line!
• They were extremely cost-inefficient!
• Most of them did not have a definitive budget or schedule,

but the main objective was to please and glorify the king!
• Nor did they care about labor rights or the environment!
Todays Projects…
• As money and resources get tighter… and the world
becomes more competitive…
• There is more emphasis on efficiency and fulfilling strict project
requirements
• We are in the age of specialization
• New challenges with new solutions
• Signature projects no longer belong only to the king!
Todays Projects…
• Time, money, and resources are very important factors…
• Many contracts contain clauses on penalties and /or
bonus for late / early completion
• Failure to deliver on time, within budget, and within
specifications; has also long-term negative consequences
• Good management can be the line that separates
success from failure!
Types of Construction Projects

• Classifications differ according to experts.
• One classification:
1. Residential Building
2. Institutional and Commercial Building
3. Specialized Industrial Construction
4. Infrastructure and Heavy Construction
• Another classification:
1. Horizontal construction → Lead designer: Civil Engineer
2. Vertical construction → Lead designer: Architect
Infrastructure Construction Projects

• Highways / roads
• Bridges
Sometimes
• Tunnels combined
• Mass transit, railways, airports

• Water supply / resources
• Waste management and waste water management
• Power generation and transmission
• Telecommunications
• Hazardous waste removal and storage
Commercial and Institutional Construction

• Commercial and institutional construction involves
building: Clinics, sports facilities, large shopping centers,
hospitals, jails, universities, banks, libraries, warehouses,
retail chain stores, skyscrapers, schools and other
projects of various sizes and types.
Residential Construction
• Residential construction projects include building single
unit homes, subdivisions, cottages, apartments,
townhouses and condominiums.
• Tract housing (also known as cookie-cutter) versus custom homes
• Difference between apartments, condominiums, and townhouses.
• Residential projects should comply with codes of practice

and local building authority regulations.
• Residential construction includes wood frame, light
gauge steel frame, joisted or load bearing masonry, steel
frame, concrete frame, and pre-engineered.
Highway and Heavy Construction

• Highway construction projects include repair, construction
and alteration of roads, bridges, tunnels, parking areas,
highways, runways and streets.
• Roads in mountainous areas may involve a variety of types: roads,
bridges, tunnels, stabilization (retaining walls, guard walls)
• Heavy construction includes projects that are not
categorized as highway or building such as dams,
sewage treatment plants, dredging projects, flood control
projects, water treatment plants and sewer line projects
• Highway construction projects may (and usually does)
include traffic design.
Project Stakeholders
• A project stakeholder is an individual, group, or
organization, who may affect, be affected by, or perceive
itself to be affected by a decision, activity, or outcome of a
project, program, or portfolio. (PMBOK, 6th ed. 2017)
• Project stakeholders in general can be single individuals
or entire organizations who are affected by the execution
or outcome of a project. Doesn’t matter whether the
project affects them negatively or positively. If they’re
affected, they’re a stakeholder. (www.wrike.com)
Project Stakeholders
• Typical key project stakeholders in a project:
• Customers
• Project manager / Project team members
• Project sponsor / financier
• Steering committee / top management / resource managers
• Stakeholders in:
• Public projects
• Projects for corporations owned by shareholders
Construction Main Stakeholders

• Owner
• The ultimate responsibility for a project
• Architect – Engineer
• Design a facility to meet the owner’s needs
• General Contractor
• Responsible for construction of the whole project
• Specialty Contractor
• Responsible for a narrow portion of the project
Examples of “Other” Stakeholders

• People who live in a neighborhood where a new project
(commercial, industrial, other) will be built
• Your neighbor whose land may be flooded because of
your new structure
• People who live in a neighborhood where a new road will
be built
• People whose livelihood may be affected by the project
even if it is not in their neighborhood
• Unfortunately, “stakeholders” does not include animals
whose habitat will be impacted by the project!
Contractors (Constructors)
• Contractors differ based on many criteria:
• Size (financial strength, volume of business, …)
• Specialty
• Geographic coverage (local, domestic, regional, international)
• Type of clients: Public and/or private
• How much work done by own forces
• Privately owned or shares traded publicly
• Classification (minority / women owned)
General / Specialty Contractor

• A Specialty Contractor takes responsibility for a narrow
scope of work while a General Contractor takes
responsibility for a broad scope project
• “Specialty Contractor” in this context means someone specialized
in the type of work like concrete, framing, or electrical. The term
“Specialty Contractor” may be used to mean someone who focuses
on a certain type of projects such as hospitals, jails, etc.
• A prime contractor contracts directly with the owner while
a subcontractor contracts with a higher level contractor
• Specialty contractors can operate under either a prime or
a sub contract
The Project Manager

• A construction Project Manager takes ultimate
responsibility for a construction project, or a significant
segment of a very large project
• For complex jobs, the designer will assign a design
project manager for the design portion of the work
• If a specialty contractor has a large project, the specialty
contractor will assign their own project manager
• A project manager will often manage multiple jobs if the
company has a number of smaller jobs
What is a Project Manager?

• A project manager (PM) is the person assigned by the
performing organization to lead the team that is
responsible for achieving the project objectives
• Managing a project includes:
1. Identifying requirements
2. Establishing clear and achievable objectives
3. Balancing the competing demands
4. Adapting the specs, plans, and approach to the different
concerns and expectations of the various stakeholders
The Project Manager

• As the project manager overseas and controls a wide
spectrum of technical and non-technical areas, he must
be familiar with all those areas. However, he may not be
an expert in all of these areas.
• Knowledge area is “inch deep, mile long”
• In addition to technical knowledge, he/she has to possess

other skills such as leadership, communications, team-
building, multi-tasking, critical thinking, motivation,
discipline, and compassion
The Project Manager

• Although the previous definition applies to the PM
representing the builder (the contractor), it is not unusual
to give the same title to the person representing the
owner’s or professional PM side.
• Role, responsibility, and authority vary accordingly
Project Management Team

• The project management team members are those
directly involved in project management activities. They
support the project manager in performing the work of
the project to achieve its objectives.
• Project management team:
• Defining needs → functions → roles
• The “project” versus “functional” organization
• “External” team members
• Responsibility versus authority
• Achieving goals: Rewards and penalties
Project Management Team

• Team members can be:
• Dedicated to this project
• Borrowed from the home office
• Part-time / temporary
• Project team covers all disciplines including administrative

and support staff
• Project team may and does change during the course of
the project, depending on the need
• Specialization and the size and nature of the project
The Leader, the Winner!

In the end, the entire team wins or loses
A project manager cannot build a project alone, but

an incompetent project manager can single-
handedly ruin one
Taken –with modifications – from the AIA contract form

The Project
The Project Management

Team
The Project Manager

Project Management Office (PMO)

• Project Management Office is an organizational structure
that standardizes the project-related governance
processes and facilitates the sharing of resources,
methodologies, tools, and techniques
• PMO is usually a permanent part of the organization that
can go up and down in size, depending on the
organization’s need
Different Perspectives
• Different parties: different perspectives, motives, goals,
and definitions of success
• The owner / User agency
• The designer (A/E)
• The builder / contractor
• Subcontractors
• The Project Management Consultant, PMC
• The general public
• Other parties (vendors, government, financial institution, etc.)
Why a Project is Initiated?

• A must or an option?
• Alternatives
• Government projects:
• Needed (infrastructure) to meet citizens demands
• Improvement
• Profitable
• Political
• Private projects:
• Corporations versus individual owners
• Investment projects: MARR
• Public private partnership, PPP

Source:
PMBOK, 6th
edition, 2017
Project Charter
• Project charter (project definition, or project statement) is
a statement of the scope, objectives, and participants in a
project. It provides a preliminary delineation of roles and
responsibilities, outlines the project objectives, identifies
the main stakeholders, and defines the authority of
the project manager.
• It serves as a reference of authority for the future of the
project.
Sample of
Project Charter
template
Public versus Private Projects

• Project initiation process
• Stakeholders
• Source of funding
• Contracting procedures
• Exceptions
• Decision making / delegation of authority / approval

• Initiating and approving changes
• Transparency
Land Development
• Land development is the conversion of land into
construction ready-to-build sites. This land can be either
virgin / bare or was previously used for a different purpose
/ type of construction.
• The process includes improvements and changes that
make the land suitable for the new use. It also makes
sure this land integrates well with its neighborhood and
environment.
• The process involves the approval of the authorities. In
many countries, this may also mean the approval of the
majority of the neighbors of that land through public
meetings.
Land Development
• One of the major risks in this process is in the official
approval or the rezoning
• For this reason, many investors put a condition in the land sale
contract that this sale is contingent upon the rezoning approval.
The contract usually gives time (e.g. 3 months) for completing the
rezoning process:
• If the rezoning is approved, the sale becomes final and, deal closes,
and the investor goes ahead with the development
• If the rezoning is not approved, the contract becomes null and void, and
the investor gets back the deposit but loses the expenses of the
feasibility study and rezoning
• Of course this type of contract bumps up the prices somewhat
compared with a fast-closing non-conditional contract
Land Development
• The developer must provide infrastructure, making the land
suitable and ready to use / build for future users. This includes
but not limited to:
• Utilities (electricity, water, sewage, cable)
• Roads, sidewalks, landscape
• Drainage
• This also requires the local authorities to upgrade infrastructure
and services to meet the new demand (roads, schools,
hospitals, emergency services, etc.)
• Local authorities charges the developer impact fees in order to cover
the cost of these upgrades
• The developer will either pay these fees and add them to his cost or
take a loan that will later be distributed on new owners
Investors and Land Development

• Investors look at land development as an investment
opportunity. The investment involves upfront cost; mainly
the purchase of the land and the development process.
• Later on, the investor / developer can either:
• Sell buildable lots (home sites), or
• Build homes and sell them
Differences between Construction and

Manufacturing
• Manufacturing typically involves mass production of
similar items while construction projects are mostly unique
• Manufacturing typically involves production of items
without a designated purchaser, while construction
typically executes a specific project for a known client.
• Manufacturing typically takes place in plants / factories,
and then the product gets shipped to the client.
Construction takes place in and outdoor environment, at
the project’s permanent location
• Mobile homes (trailers) are part of manufacturing, not
construction
Differences between Construction and

Manufacturing
• Manufacturing may produce an incomplete product so it can be
used by another manufacturer for a complete product. For
example, you can have a factory to make auto engines,
upholstery, or audio systems. Construction must end with a
finished product.
• We can compare, in the above example, the auto manufacturer
to the general contractor; and the manufacturers of auto
engines, upholstery, tires, or audio systems; to subcontractors
in construction projects. There are still many differences. Most
importantly that manufacturers, small or big, work on
continuous production line while construction subcontractors
work on unique projects although same specialty
Do Construction and Manufacturing Co-

exist?
• There is sometimes interrelationship between
construction and manufacturing: Many modular
(manufactured) units are used in construction
• The extent of how much this practice is done, depends on
many factors that can be grouped under feasibility and
economics
• For example of an extreme case, the 30-story hotel in
China that was “built” in 15 days
https://www.youtube.com/watch?v=rwvmru5JmXk&t=8s
Life Cycle of the Project

Proposal /
Request
Feasibility
Study
No
Go
Yes
Planning
Design
Bid/
Nego
Construction
HO /
The “Project” TO
Operation /
Maintenance
Upgrade
/ Rehab
Disposal
Project Management Process Groups

Construction Project Stages

1. Planning and Definition
• From owner need to definition of characteristics that will meet
that need
2. Design
• From design characteristics to construction documents
3. Procurement and Construction

• From construction documents to the physical reality
Important Construction Milestones

1. Bid announcement / invitation
2. Bid submission / opening
3. Contract signing
4. Notice to Proceed (NTP)
5. Substantial completion
6. Final completion
7. Turn over (by contractor) / Take over (by owner)
8. Fiscal close out (or simply close out)
9. End of warranty period
Construction Project Management
Initiation
Planning
Design
Bid/Nego
Construction
Close out
Construction Management
Project Management
Fast Tracking
• Fast-tracking means starting construction before the
design is completely finished.
Design
Construction
• Conceptual design must first be done; the detailed design follows in

stages. The construction of each phase (or component) follows the
detailed design of the phase while the next phase is being
designed.
Fast Tracking
• The decision for this option has to be made very early during the
project's conception and requires a special agreement/contract
between the owner, the designer, and the contractor.
• Pros & cons
Design I Design II Design III
Constr. I Constr. II Constr. III

Industrial Projects
• Project commissioning is the process of assuring that all
systems and components of a building or industrial plant
are designed, installed, tested, operated, and maintained
according to the operational requirements of the owner or
final client
Construction Project Management

• Project management in construction includes:
• Scheduling / Time Management, Project
• Budget / Cost Management, controls
• Risk Management
• Procurement management,
• Scope / Change management,
• Logistics management, They are all
• Project administration, interrelated!
• Quality management,
• HSE / HSSE management,
• Other
Construction Processes
Though projects are unique, construction processes tend to
be similar from job to job
• They can be standardized
• They can be improved
• They can be optimized
• They can be taught
To Bid or not to Bid?

• Factors influencing the contractor’s decision to bid or not to
bid a project
1. Risk involved:
a) Strength and stability of the company
b) Type of construction involved compared to the contractor's area of
expertise
c) Location of the project
d) Size of the project
2. The project’s owner and architect/engineer, previous experience
3. The amount of work currently on hand / Bonding capacity
4. The equipment and qualified personnel available
5. Prevailing economic conditions / other bidders
6. The company’s strategic plan, for example: expand
geographically or in specialty?
Project Management Organization

Structures
• Organization of project teams structures differ according
to organization’s own policy as well as certain
characteristics of projects.
• Some of the important differences are:
• Who the project leader is,
• Who has the responsibility and authority,
• Who makes the decisions, and
• Who does the team member report to?
Project Management Organization

Structures
• Three main types organization structures used in projects:
• Functional project organization
• Pure project (projectized) organization
• Matrix project organization (a hybrid between the top two, with
varying degrees of leaning towards one of them)
Functional Project Organization
Project
coordination
Functional Project Organization

• Characteristics
• Project teams formed within the functional units.
• Potential weak “team spirit”
• Nobody is responsible for the entire project.
• Leadership occurs within functional units (expertise centers).
• Leadership belongs to technical experts.
Pure Project Organization

Pure Project Organization

• Characteristics
• Project requiring major changes.
• Hence, a small, self-sufficient and full-time team is set up.
• The team leader is like a CEO.
• Leader has full responsibility over the project.
Matrix Project Organization

• A hybrid form that combines both some characteristics of
functional and pure project organization forms.
• Project manager and functional managers share
responsibilities.
• Project manager decides what tasks will be done, and when they
will be done.
• Functional manager decides who will work in the project and which
technologies will be used.
• Members of the project team have two “bosses” that they report to.
• Team members could be working on multiple projects.


• Characteristics of projects suitable for this organization
structure :
• Integration of work done by different functional units is very
important.
• Changes (instability) both inside and outside the company.
• Success does not depend on application of a narrow expertise.

• Matrix structures differ according to the “weight” of the
project manager (relative to functional managers) :
(1) “Lightweight”: Closer to functional organization
(2) “Middleweight” - the traditional one
(3) “Heavyweight”: Closer to projectized organization
Procuring Contractors
Three approaches are used to acquire contractors:
• Competitive (General) Bidding
• Qualification may be pre or post bidding
• Public projects use this type except in justifiable cases
• Selective Bidding
• A selected group of bidders are invited to bid
• Public projects use this type only when justifiable
• Negotiation / Direct Award

Procuring Contractors
• The choice of the successful contractor is based one:
• Lowest price
• A combination of price and speed
• Best qualifications
• A mixture of price and qualifications
Legal Contracts
• Requirements for any legal contract:
1. Agreement: Offer and acceptance
2. Consideration: Exchange of value
3. Capacity: Competence of parties involved
4. Legality: All actions taken by all parties must be legal
Types of Contract Agreements

• Fixed price contracts
• Lump-sum
• Unit price
• Cost-plus-fee:
• Cost plus a fixed (lump-sum) fee
• Cost plus a percentage fee
• Cost plus a sliding-scale fee
• Cost plus a fixed fee with a bonus / penalty
• Cost plus fee with a guaranteed maximum price (GMP)
• One of the major differences between the above types is

risk allocation
• When do you recommend each type?
Contract Formats
• An owner can choose among:
1. A Contract Template: FIDIC, NEC, AIA, AGC
2. Own organization template
3. A custom-written contract
• Pros and cons of each type
• Limited ability to customize a template in the “special
conditions”
Project Delivery Methods

• A delivery method is the approach the owner of a project
uses to assign responsibility and authority among the
project team members in order to manage the entire
lifecycle of the project process from inception to final
completion
• A delivery method is not a type of contract, although there
is often a correlation between the delivery method and the
type of contract
Project Delivery Systems

A project can be packaged in a variety of ways
• Design – Bid – Construct
• The traditional way of procuring construction
• Design – Construct (also called Design-Build)

• Single point of responsibility for the owner
• Difference between Design-Build and Turnkey
• Construction Management
• Agency CM – Manages on behalf of the owner
• CM at Risk – Combines Agency CM and Negotiated GC
Traditional: Design-Bid-Build
• Characteristics:
• Two contracts (Architect & Contractor)
• Best understood
• Linear sequence of work (longest delivery)
• Primary Reason to Choose

• Retain control of design
• Procurement laws are well defined
• Low first cost (Bidding)
• Disadvantages
• Final cost changes: Owner responsible
• Most litigious
• Contractor has no input to project
Source: Comparison of Project Delivery Methods
https://network.aia.org/home
Design-Build
• Single point of
contact/responsibility
• Often is the fastest delivery
• Most cost effective
• Need a well defined scope
• Need for timely decisions
• Must effectively administer
design-build process
Design-Build
• Benefits to the Owner
• Owner retains control of design
• Construction input occurs during the design process
• Overlaps & gaps in scope are identified during pre-construction
• Cost benefit of procuring the construction directly from the trades
• There are no mark-ups on subcontracts or on changes
• Improved schedule due to early resolution of design and
construction issues
• Packaging of work can allow for construction to start early
• Tighter control to adhere scope budget
• CM as Owner’s representative manages the construction in the
Owner’s best interest
Design-Build
• Disadvantages:
• Owner responsible for changes, overlaps and gaps in scope
• Exposure to CM’s lack of proper oversight
• Subcontractors may be brought into project late in the process
• Need up-front program & performance criteria
• Owner needs to manage decisions on quality
• Owner is pushed for early decisions
Pure Agency CM / CM-for-fee
CM
Pure Agency CM / CM-for-fee / CM-Multi-

Prime
• Many contracts (Architect, Contractor, Subcontractors)
• Linear design
• CM is selected on qualifications
• Primary reason to choose:

• Contractor involved early
• Combine fast track and lowest bids
• Disadvantages:
• Owner responsible for changes, overlaps and gaps in scope
• Lack of subcontractor involvement
• Exposure to CM’s lack of proper oversight
CM at Risk
CM at Risk
• Two contracts (Architect & Contractor)
• CM is selected on qualifications and fees
• Some construction risks are transferred to GC
• Similar to CM Multi-Prime for selection and management of the
work
• Open book on costs (subcontractor and supplier payments) and
procurement process
• Flexibility to price the project
• Subcontracts are re-assigned to the CM
• Bonding can be for the entire scope of the work (GC and
subcontractors)
• Risks can push the CM not to act as the agent of the Owner
CM at Risk
• Primary reason to choose:
• Contractor involved early
• Flexibility to price the project
• Disadvantages
• Owner responsible for changes
• Owner’s qualification-based selection of CM
• Architect may not take input from CM during design
Comparative Study: DB vs. DBB

• In a Penn State University / CII Study*:
• Construction Industry Institute study of 351 projects in 37
states.
• Compared the cost, schedule and quality performance of DBB,
CM@R and DB deliveries.
• Findings:
• DB cost at least 6% less than DBB
• DB is at least 33% faster than DBB
• DB provides at least 10% better quality than DBB
• CII has another interesting study on trust-cost relationship
between owner and contractor
* https://dbia.org/wp-content/uploads/2018/05/Research-Cii-Penn-State-Study.pdf
Comparative Study: DB vs. DBB (cont’d)

Conclusion on Delivery Method

• Even though studies show trends and averages, there is
no one method that is proven best for all cases
• Decision has to be made on the merits of the case
• Owner cannot get something for nothing:

• Often saving of money comes with responsibility, liability, and
headache.
• Owner may take a role if it has the expertise and competence.
Otherwise, hiring a professional will be best decision.
• Owner’s priority of cost versus time plays a major role in
the choice decision
• Also other factors such as the balance between aesthetics,
functionality, and cost of the project.
It Is All About Allocating Risk

• The guidelines of the Construction Management
Association of America:
1. Risk should be assigned to the party who can best control it
2. Risk should be assigned to the party who can bear the risk at
the lowest cost
3. Risk should be assigned to the Owner when no other party can
control the risk or bear the loss
4. Assumption of risk by the other parties to the construction
process results in increases in cost (visible or hidden) to the
Owner”
Capstone: The History of Construction Management Practice and Procedures, 2003 Edition,
Construction Management Association of America, Inc. (CMAA)
Defining Project Success: Different

Perspectives
• Project success is defined as achieving objective within
defined constraints
• Success from whose perspective?
• The owner / User agency
• The designer
• The builder / contractor
• Third party (government – financial institution)
• Different objectives and goals

• Short-term versus long-term goals
• The small versus the big picture
Why Projects Fail?

• A partial list for why 5. Inaccurate cash flow
projects fail: prediction /
management
1. Unclear project
objectives / Scope 6. Unreliable estimates
creep / failure to 7. Unreliable schedules
reconcile between the 8. Lack of following proper
“wish list” and “can list” procedures (especially
2. Lack of planning when things are going
3. Poor communications fine)
4. Lack of / bad resources 9. Bad project control /
management monitoring practices
10.Unrealistic expectations
Why Projects Fail? - 2

11.Stakeholder conflict 17.Unsafe project site /
12.No / bad risk practices
management 18.Failure to align project
13.Lack of management with organizational
support objectives
14.Lack of proper 19.Politics
documentation
15.Lack of team work / “I”
instead of “we”
16.Inability to keep up with
technology
The Golden Triangle

Quality
Scope
Schedule Cost
Balancing Project Scope and Constraints
Safety Environ-
mental
Cost
Project
Other
Scope
Schedule
Reputation
Quality / Public
Relations
Project Planning
• Project planning is the comprehensive process of thinking
of and preparing for the activities and actions needed to
complete a project.
• This includes but not limited to: defining scope and
constraints, performing feasibility studies (financial, legal,
and other), and comparing alternative designs and
execution methods.
Project Planning
• Most importantly, project planning must help the owner:
• Making the decision whether or not to carry out the project, and
• Better and more efficient execution of the project.
• Importance of owner’s “due diligence” as part of the

planning
• Total lifecycle cost needs to be evaluated, not only the
upfront cost
• Better planning results in better execution of the project
with less cost, less duration, and less conflicts
Project Planning
• Planning is also needed by the contractor and other
project participants.
• Taking advantage of time, balancing benefits with losses / risks
• It is important that planning starts as early as possible

before the start of the project, but it continues till the end
of the project:
• Predict events and incidents, and prepare for dealing with them
• and then update the list as you go, with new items deleted, added,
or adjusted
• Sort of like risk management
Importance of Planning
• Measure twice and cut once!
• Planning and execution time: The inverse relationship!
• To a point, of course!
• Hope is not a strategy

• Failing to plan is planning to fail
• The story of the chicken farmer

Project Planning
• Project planning starts with:
• What / where? Defining the scope
• Why / why not?
• How much / how long?
• Within…. (all constraints)?
• How / who?
• This investigation may take several iterations as more info

becomes available
Planning and Scheduling
Schedule
when
The Plan
Planning Benefit–Cost Ratio

• Main dilemma: When a party is likely to take on a job but
not sure: Planning requires time and money but it may be
a gamble like marketing a workshop or conference but not
sure if the event will happen.
• In construction:
• Bidding for a project
• Spending time and money during negotiation phase
• Preparing to mobilize before NTP
• Preparing for an upcoming hurricane
• Difference in planning between being “not knowing if the

event will happen” and being “not knowing when exactly
the event will happen”
Planning Benefit–Cost Ratio

• The contractor, or anyone in business, sometimes needs
to plan for something, good or bad, that may or may not
happen
• This planning consumes time and money. So what happens if the
expected event does not happen?
Consider risk and Cost / Benefit ratio for planning
Time
Bidding period
Contract signed
Project under
NTP issued
announced
execution
Bid
It all Start with Planning!
$ Ability to
influence change
Failure to
prepare is
preparing to
fail
Cost of
change
Time
Project Management Plan

• Project Management Plan is the document that
describes how the project will be executed monitored,
controlled, and closed.
• It documents:
• Approved scope, schedule, and cost baselines
• Project planning assumptions and constraints
• Project planning decisions regarding alternatives chosen
• Point of reference for measuring progress

• Guides project execution and control
• Caution about the acronym PMP
Project Management Plan

• The Project Management Institute, PMI, defines the
Project Management Plan as the document that describes
how the project will be executed, monitored and
controlled, and closed
• The plan represents the roadmap that shows how the
owner intends to execute the project
• It has to be dynamic, expandable, and adjustable as
needed.
• Specific but not too specific!
The Project Management Plan

• The plan can take different shapes and have different
contents depending on:
• The purpose of the plan
• The timing of the plan
• The level of details needed
Project Management Life Cycle

Scope Management
• Project scope is the part of project planning that involves
determining and documenting a list of specific project
goals, deliverables, features, functions, tasks, deadlines,
and ultimately costs.
• It defines what needs to be achieved and the work that must be
done to deliver a project.
• Scope must be well defined and clearly communicated in
the early project phases
• Well-defined but perhaps with some flexibility!
Scope Management
• Along with defining the scope, it is important to define and
understand the constraints
Need versus wish versus can

Defining and Managing the Scope

• Most likely, it will take several iterations to finalize the
scope
• Who defines? Who suggests? Who approves?
• Getting input from professionals is important
• Understand the different options and trade-offs in order to
make informed decisions
• Value versus cost
• The emotional factor
Managing the Scope

• Basically it includes two integrating components:
 Before execution: Define the need along with contractual
constraints. Also set stakeholder expectations
 During execution: Manage changes and minimize surprises
 Are all changes bad?
• The work should be closely monitored to ensure that

when a change is requested, it is evaluated, captured,
and documented.
Impact of Timing of Change

• An owner decides to change the size of some doors from
2 feet 8 inches wide to 3 feet 0 inches wide. Consider the
following five different scenarios:
1. The owner makes the change before the design is completed.
2. The owner makes the change after the design is completed but
before the bidding begins.
3. The owner makes the change after signing the construction
contract but before the doors are delivered and the work on that
portion has started.
4. The owner makes the change after the door openings have been
framed (in masonry walls) but before the walls are finished.
5. The owner makes the change after everything was completed.
Impact of Timing of Change

Change timing Cost* Name of change
1 During design and The architect’s fees to redo
before it is completed the drawings / specs
2 After bid Above + cost of addendum Addendum
announcement
3 After signing the (1) + likely contractor’s fees Change order, $
contract but before for change order
above ground work
starts
4 After door openings (1) + contractor’s fees to redo Change order,
were framed but door openings and replace $$
before the walls are doors (most likely they are
finished ordered / delivered)
5 After entire work is (1) + cost to redo entire work Change order,
finished for door openings and doors $$$
Scope Management
• Project scope versus product scope
• Project scope refers to everything that needs to be done to get
the product delivered,
• Product scope includes features, functions and characteristics of
the product.
• Product scope is oriented towards the “what” part (functional
requirements) and project scope is oriented towards the “how”
part (work related).
• Principally, the contractor will be concerned with the 1st
type while the owner cares more about the 2nd type.
Project Scope versus Product Scope

• To illustrate the difference between Product and Project
Scope let's take a look at an example*.
• A manager is tasked with providing a new data center for an
organization. In this case, product scope would include the tangible
details of the final deliverable: the computers, servers, office space,
network connectivity and requisite software. The overall product is
the data center itself, and the product scope consists of the
component parts that together make up the new data center.
* Reference: Villanova University website

Project Scope versus Product Scope

• Project scope, however, would focus more on the process of
getting from empty space to a fully functioning data center. It would
include corresponding with contractors and designers, acquiring
each of the physical parts mentioned above, providing project
documents to managers and team members and setting overall
budgets and timeframes for final delivery. Project scope is every
step taken to get from start to finish, and while it does include
considerations of how to get the product’s parts, it does not
address what those parts should be or how they should work
together. Where product scope tells us what we need for the
finished data center, project scope tells us how to get there.
Scope Management
• The stages of defining the project scope:
1. The owner expresses a need for a project to a designer, along
with the limitations (constraints)
2. The designer puts the idea into a set of drawings and
specifications
3. The owner hires a contractor (builder) to execute the idea
4. The owner monitors the process; comparing the “actual” to the
original idea.
• Variances versus intentional changes
5. Contractor’s challenge: To meet contractual obligations (and
expectations) and make profit.
Scope Creep
• Scope creep is the continuous and gradual expansion of
the scope of a project (size, area, design, materials, etc.)
after the contract has been signed, as a result of multiple
and successive owner-issued change orders.
• Scope creep usually results from the owner's lack of
vision, lack of appreciating the impact of changes on the
cost and schedule, unrealistic expectations, decentralized
decision making, and/or other factors. It usually results in
negative consequences to the owner, including the
reduction of the value obtained in the project
Scope Creep
• Why is it bad for project management?
• Scope creep is different from intentional, studied, and
controlled changes.
Scope Changes
• Scope changes can happen for a myriad of reasons but
generally they are categorized as intentional and
unintentional
• A project with a well-defined well-managed scope should have no
or minimum changes
• The earlier the change is made, the less it costs in term of money,
time, and headache
• During the design phase: Design changes
• During the procurement phase: addendum
• During the execution phase: Change (variation) order
Causes of Scope Creep

1. Lack of proper scope definition
• Some owners push for quick start before a thorough
requirements and cost-benefit analysis has been done.
• There are multiple decision makers and the decision making
process is not well-defined
• Taking uncalculated risk
• Allowing direct unmanaged contact between client and team
participants
• Poor requirements analysis
• Scope defined too early

2. Requirements and scope not managed
• Changes in the decision making personnel
• Bad decision making process and scope management
• Customers trying to get extra work “on the cheap.”
3. Inconsistent process for collecting requirements
• Bad planning!
• Rushing to execution
• Lack of teamwork and leadership / coordination

4. Not having client agreement
5. Not raising issues proactively
6. Not prioritizing among features
• The “Optimization of the Selection Criteria” template
7. Not interrogating new requests

8. Not involving users early enough
9. Underestimating the complexity of the project
10. Lack of change control
11. Length of the project
Scope Management
• In general, a good definition and management of the
scope helps minimize changes during the execution, and
hence improve the success of the project.
• It is a team effort issue; the owner, the designer, the contractor, and
possible other players
• Efficient and well-defined decision making process,
meetings, clear communications, and documentation are
important tools for good scope management

Intro Project Management

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Intro Project Management

Uploaded by

Copyright:

Available Formats

CONSTRUCTION PROJECT

Engineering and Architecture

Aesthetics Functionality Economy Safety

The balance of these three elements optimizes the

The Game of Balance

• The owner, architect, structural engineer, and contractor

The Game of Balance: Another Example

Architects and Engineers

• What’s more interesting is owner’s decision: They like a

Engineering & Construction

• In the old times, the “builder” did the architecture,

• There are no two projects that are the same

What is Project Management?

What is Project Management?

Project Management versus Operations

• A program can be a large and complex project

Subproject Subproject Subproject

Activity, Project, or Program?

• What we do, falls under any of these…

• Program: Summer Olympic 2024 in Paris

Can the Following be Considered

The Construction Industry

The Construction Industry, cont.

What Makes Construction Projects

What Makes Construction Projects

5. Projects are unique, non-standard production, infinite

What Makes Construction Projects

What is Construction Management

2. The supervision of construction operations,

What is Construction Management

Source: Construction Management Association of American, CMAA

Contractor’s Construction Management

Is Construction Management a Science?

Only one Expert opinions, Many answers

Education versus Experience

Experience versus Education

Why Training / Continuing Education?

Project Management Institute, PMI

Construction Projects in the Past

Yes, they were great but…

• The builders had almost unlimited resources

• Most of them did not have a definitive budget or schedule,

Types of Construction Projects

Infrastructure Construction Projects

• Mass transit, railways, airports

Commercial and Institutional Construction

• Residential projects should comply with codes of practice

Highway and Heavy Construction

Construction Main Stakeholders

Examples of “Other” Stakeholders

General / Specialty Contractor

The Project Manager

What is a Project Manager?

The Project Manager

• In addition to technical knowledge, he/she has to possess

The Project Manager

Project Management Team

Project Management Team

• Project team covers all disciplines including administrative

The Leader, the Winner!

A project manager cannot build a project alone, but

Taken –with modifications – from the AIA contract form

The Project Management