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NO.3 J U N E 2 0 2 0 YO U R S O U R C E F O R T O TA L C O S T M A N A G E M E N T
AACE
International Estimate Validation and
Announces Estimating Guidelines
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5 President’s Message
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8 Certification News
So, You Want to Be An
Expert Witness? 6
11 Rising Professional
Natasha Sleigh PMP, PSP
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8 Excellence
4 Learning Our certification programs are independently accredited by
the Council of Engineering & Scientific Specialty Boards. AACE
We offer numerous online learning courses on estimating and
certifications are a recognized credible standard in the cost
project management. The Approved Educational Provider
management field. A recent study shows that individuals with
program helps maintain high quality development courses and
an AACE Certification earn 17.4% more than their counterpart
providers. AACE also holds many seminars throughout the year.
without a certificate.
5 Resources 9 Discounts
Starting with the TCM Framework and Recommended
Practices that are available for free only to members to our On products and services ranging from AACE International
bi-monthly publication Cost Engineering featuring articles Conference & Expo registration fees, archived webinars and
for cost professionals around the world. Through the AACE presentations, certification examination registrations, and more!
International website, the Cost Engineering journal is a great
current resource for members and as a member, you gain
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BY DOUGLAS W. LEO, CCP CEP FAACE Hon. Life, President, AACE International
Since my last message, AACE over the last four years has consistently I would like to thank our Associate Board
International has adapted, maintained approximately 7500 members with Chairs whose dedication and hard work are
modified, and changed due to the a +/- 1% variability. In the midst of the current vital to the success of the Association. They
risks presented by the COVID-19 worldwide shutdown, renewals are tracking drive the quality, quantity, and awareness of
pandemic. In multiple ways, we have slightly higher over last year, as of this writing. our Body of Knowledge, our certifications,
gone virtual with our offerings and how our Interest in our certifications has been and our educational offerings. The current
headquarters is presently operating. Our strong. As of May 01, we are seeing increased Board of Directors has shown an amazing
traditional Annual Conference and Expo this registrations to sit for exams, increases in work ethic, knowledge, dedication and
year will consist of 18 livestreaming sessions actual exams completed, and increases commitment to the success of AACE
conducted over a six-day period from June in certifications granted. Our Body of International. My appreciation to them for
28-July 3rd. Approximately 80 pre-recorded Knowledge continues to grow and be updated. a job well done. Throughout the year, I have
technical sessions from presenters and panelists New Recommended Practices are being added received council, advice, and a listening ear
will be available to our online attendees. every quarter and educational offerings to from many AACE Past Presidents. Much
We have also begun offering Tech Talks support our certifications have become a thanks and appreciation to Past Presidents
every Tuesday and Thursday, which are focus. All of this is only possible through the Charlie Bolyard, John Ciccarelli, Martin
presented as free limited-time technical hard work, collaboration, and dedication of Darley, Steve Warhoe, Mark Grotefend, Mike
offerings for our members. As our members our volunteer members and our headquarters Nosbisch, and Ozzie Belcher. Our incoming
are working from home, these technical staff. As we are transitioning to the AACE President Chris Caddell has proven to be very
talks, given by top industry professionals, International 2020-2021 year, accept my hard working and capable this year. I wish
are an excellent way to obtain personal thanks and admiration for your achievements him well during his year as President and offer
continuing education and CEU’s toward on behalf of the Association. my assistance wherever needed.
AACE recertification. Headquarters has We have seen greater cooperation this And lastly, I would be remiss as I end my
done a remarkable job pivoting quickly last year between AACE International and term without thanking the three members
from preparing for a face-to-face conference the Royal Institution of Chartered Surveyors who started my AACE International journey,
to making a virtual conference a reality. (RICS). Much thanks to Pete Bredehoeft Larry Dysert, Bruce Elliott, and John
All of this has been accomplished while of the Technical Associate Board, who is Hollmann. All three have been long-term
our headquarters staff have been working championing the International Construction coworkers, mentors and friends who first
remotely due to COVID-19. Measurement Standards (ICMS) effort, as our acquainted me with AACE International.
Collaboration between staff members, AACE International representative. AACE Bruce’s words that introduced me to AACE
which is necessary to coordinate all the International is also planning to participate often come to mind and have been career
moving pieces to prepare our virtual next month in a Leadership Forum with RICS changing for me. “If you are interested in cost,
presentations, has been seamlessly that is striving to work toward educational and schedule and estimating, you have to be a
accomplished remotely … no easy task. training cooperation between the Associations. member of AACE.” And thus it began.
Additionally, our worldwide sections have As I am ending my term as Association
risen to the task and are offering many President, I would like to express my thanks
virtual meetings to members. I would like for the cooperation and patience that I have If you would like
to congratulate the versatility, creativity, and been afforded by our membership. The to contact our
hard work exhibited by our Headquarters professionalism of our membership, as a whole, current president
staff and our local section boards during these is unsurpassed in the projects profession and with questions or
difficult times. AACE International members this makes me a grateful 25+ year member of comments about
are being well served. Well done to them all. the Association. A special shout out to Past The President’s
AACE International has proven resilient Association President John Ciccarelli, who Message please
while we weather the COVID-19 pandemic. stepped in this year as acting Past President on address your
2019 was a strong year for the Association. the Board of Directors. John’s participation, e-mail to president@aacei.org. To engage
Financially, we ended the year substantially steady hand, and knowledge were of in other discussions, check out AACE
higher due to both revenue and investments. immeasurable assistance to the current Board International’s online Communities at
Tracking our membership, the Association and the Association as a whole. communities.aacei.org.
A careful review of the estimate should be done to verify that the estimate detail pages should be traced to the estimate backup or
cost estimate follows established standard estimating guidelines for source documents?
the department or the company. This would include a review to
verify that standard estimating procedures were followed regarding • Verify that all allowances and factors being prepared are
estimate format, cost coding, presentation, and documentation. This consistent with comparable projects and estimates. This level of
would include items such as the following: estimate review helps to ensure that all estimates prepared by the
department are using established guidelines and are presented in
• Verify that the proper estimating methods, techniques, and a consistent manner from project to project.
procedures were used that match the class of project completeness.
In other words, different estimating techniques will be used ENGINEERING/DESIGN REVIEW
depending on the type and completeness of the engineering The next level of estimate review should be held with the engineering
documents and deliverables available to create the estimate. team and should evaluate the estimate in terms of accurately
representing the project scope. The core members of the engineering
• Confirm that the estimate summary and details are organized team are key participants in this review, along with the lead
and presented in the proper established format. The estimate estimator and estimating team.
should follow the standard work breakdown structure and code
of accounts. Also, the estimate format needs to be consistent COMPLETENESS OF ENGINEERING DELIVERABLES
with the intended purpose of the estimate and provide sufficient One of the first items to review is complete list of all drawings,
detail to meet this purpose. sketches, specifications, and other engineering deliverables used
in preparing the estimate to ensure that it is complete. The lead
• Ensure that all estimate backup information is organized engineers need to cross-reference this listing against their own
properly. All values on the summary page of the estimate should engineering drawing and deliverables lists to make sure that all
be traced to the estimate detail pages, and all information on the relevant information was passed on to the estimating team. The
So, You subjects to the “triers of fact” (arbitrators, judges, or juries) that they
generally would not understand based on their own background
Jennifer Khairallah
Jennifer Khairallah, M.Eng, is a and consultants. In parallel, she completed
project management professional a Master of Building Engineering degree
with 5 years of experience in from Concordia University on a part-
mega capex P3 projects in the time basis, combining professional and
healthcare and transportation educational growth.
sectors. Working with major She believes achievement is all about
general contractors, she was the right mindset. Anything is possible if
involved in all project phases you put in the hard work and persevere. By
from initial planning to design, studying and working simultaneously, it
procurement, site execution, became extremely satisfying to apply the
performance monitoring and lessons learned in the classrooms, directly
project close-out. on the worksite. After the hospital handover,
Jennifer had a third culture upbringing. Jennifer joined SNC-Lavalin as a project
Born in Beirut, she never had the controls engineer working on the Réseau
opportunity to live in Lebanon, her home express métropolitain (REM), a 6B$ public
country. Her childhood was spent between transit project consisting of 67-km and 26
England, Scotland, and Qatar, before settling stations, one of the largest automated light
in the United Arab Emirates. Being exposed transportation system in the world.
to different cultures at a young age broadened her view of the world and Jennifer joined the project controls team where she participated
allowed her to learn four different languages. For the most part, Jennifer in setting up the budget proposal during initiation and planning
grew up in Abu Dhabi where she witnessed the construction boom phase. After project award, she took on a cost control role leading
of one of the most rapidly expanding cities at the time. the budget management of multi-million subcontracts for the
She naturally became interested in the built environment and was Tracks & Systems package in the execution phase. Responsible for
fascinated by the thought that humans can build such massive buildings maintaining monthly forecasts, tracking, and analyzing costs and
and infrastructures. This curiosity pushed her to pursue a Bachelor of conducting earned value analysis using JD Edwards, she quickly
Architecture at McGill University in Montréal, Canada, thus satisfying became a key member of the team providing technical training and
her creative and rational persona. Her studies forged her strong support to the organization. During her time on the REM, she was
work ethics and instilled in her the drive to succeed in high pressure able to equip herself with best practices and developed tracking tools
environments. After completing a couple architecture internships, the to better monitor, control, and report on the job performance.
interest of understanding the “how” of the built environment led her Jennifer is currently working as a Senior Associate at Deloitte in
to complement her architectural studies with a minor in construction their Capital Projects & Infrastructure practice, providing services
engineering and project management. From there on, a passion for in project management, cost/schedule assessments, construction
working on mega capex construction projects became clear. audits and advising clients on their project controls and governance
Upon graduation, Jennifer joined Construction Santé Montréal, a programs. Working with highly skilled and driven individuals is a key
joint venture between Laing O’Rourke and OHL Canada during the motivator that becomes an everyday learning experience. Everyone is
execution phase. The consortium was responsible for building Phase 2 a mentor and a mentee if you are willing to learn and share.
of the Centre Hospitalier de l’Université de Montréal (CHUM), one of Jennifer joined the AACE International while working at SNC-
the largest P3 healthcare projects in North America, a new landmark in Lavalin. She started attending various seminars on project controls
downtown Montréal. The mandate consisted of the construction of the and really enjoyed networking and connecting with like-minded
325,000 m² world-class hospital complex, holding 772 private rooms, professionals. Her functional manager at the time was the President of
26 inpatient units, and 39 operating rooms, relying on cutting edge the Montréal Section and was very supportive of her learning ambitions.
technologies and state-of-the-art patient care equipment. She was even given the opportunity to contribute and produce
Enjoying the overall view, as well as the granular details, Jennifer visuals for a publication titled, “Schedule and Cost Management
joined as a field planner acquiring skills in scheduling and progress of Subcontracts,” presented at the 2018 AACE International
monitoring using Primavera P6. She quickly realized the importance of Conference & Expo. Jennifer believes that the AACE conferences
projects controls tools to evaluate performance and drive progress. offered tremendous insights into leading practices and are invaluable
Oftentimes, the construction team becomes too focused in in keeping up to date with the current challenges faced in the industry.
execution, which is when an external perspective becomes highly As a woman in construction, Jennifer quickly realized the importance
valuable to keep the project on scope, within budget, and respecting of taking your place, sitting at the table, and having your voice heard
the schedule. With this mindset, Jennifer decided to put her planning in any context. She always seeks to empower her female colleagues in
skills to practice and joined the construction team as an assistant site project controls and promote personal growth and self-development.
manager. She was responsible for coordinating site activities of the One of her favorite quotes is: “Fortune does favor the bold and you’ll
public spaces and artwork package, liaising daily with subcontractors never know what you’re capable of if you don’t try.” – Sheryl Sandberg
AACE appreciates everyone’s patience during these at the in-person event, all the technical papers, plus all of the
uncertain times while we endure the global pandemic. conference recordings that normally would not have been made
For the health and safety of our attendees and staff available until several months post event and were an additional
we have made the difficult decision to not hold an in- fee. (The recorded sessions have been offered with the purchase
person Conference & Expo in Chicago this year. Instead of the Conference & Expo registration at the deeply discounted
the event will be held virtually over a six-day period from June 28- additional rate of $195 – or afterwards at $750 member/$850
July 3rd from 11 a.m. – 3 p.m. EDT each day. non-member rate.)
The 2020* Virtual Conference & Expo will consist of 18 AACE is committed to providing timely and relevant technical
livestreaming sessions (3 live sessions/day over that time frame) guidance to our members and we hope that you will make the
from some of AACE’s top-rated speakers, as well as an estimated 80 decision to join the virtual event. Our staff has been working on the
pre-recorded sessions from speakers and panelists. The pre-recorded virtual event since March, although due to contractual obligations
sessions will be available to access immediately on June 28th. We we were not able to announce this change until recently. The
are also planning a number of virtual networking events, plus the registration platform for the 2020* Virtual Conference & Expo is
technical subcommittee meetings, SIG meetings, a Rising Professionals currently being developed. Registration is now open. We hope you
Committee meet and greet – and will be working with our exhibitors will join us for the 2020* Virtual Conference & Expo.
and sponsors so you can engage with them virtually as well. Individuals who were pre-registered for the 2020 Conference
We recognize that the in-person event provides you with & Expo have been given the option for a full refund, or to have a
access to leaders and professionals in the field, networking partial refund with the remaining balance being applied to the 2020*
opportunities and social functions and in recognition of that Virtual Conference & Expo. Individuals who were booked at the
we have deeply discounted the fee of the Virtual Conference & Hilton Chicago will have their reservation canceled and receive a full
Expo to $400 for members and $500 for non-members. This fee refund from the hotel.
includes all of the technical content you could have experienced Thank you for your continuing support of AACE. Be well!
COVID-19 • Between people who are in close contact with one another
(within about 6 feet).
Learn more about what you can do to protect yourself and others.
ABSTRACT owners. In this article, the basic information When the contractor’s means and
Construction labor productivity represents related to loss of productivity claims is first method of performance or work sequence
how efficient a contractor is in applying set forth. And then the defense against loss is impacted by factors attributable to
labor resource to produce output. Labor of productivity claims from the aspects another party, a loss of productivity (or
productivity is susceptible to many factors of entitlement, causation, and quantum disruption) claim can be filed against the
during construction. Some of them may is discussed. This article also provides parties that caused the damage. LOP claims
be attributable to the owner, such as those suggestions on how to prevent, mitigate, and (or disruption claims) can be asserted by
caused by owner changes and directed manage loss of productivity claims, especially contractors against owners, subcontractors
acceleration; while others are within the for inexperienced owners. against contractors, contractors against
contractor’s control. When it cannot meet its subcontractors, and even contractors against
planned productivity, the contractor’s profit INTRODUCTION design professionals when permitted by
margin shrinks, or it could even suffer a loss. In construction, productivity is a law. This article concentrates on claims by
It is not uncommon that owners become measurement of rate of work completed contractors against owners, although the
targets for loss of productivity claims. While per unit of effort, usually measured in labor principles discussed herein generally apply in
loss of productivity is one of the most hours. When the contractor expends more other LOP claims.
contentious subjects in construction disputes, effort per unit of production for a significant For a LOP claim, there can be multiple
it is a challenging task to defend against portion of the work, that is usually referred outcomes: it will be accepted in full; it will
such a claim, especially for inexperienced to as Loss of Productivity (LOP). [1, p.1] be accepted but with a reduced amount;
NEW AACE
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COURSES
AVAILABLE AACE® International eLearning Modules
RECOMMENDED PRACTICE
11R-88 - SECTION 2.2.3
Schedule Planning and
Development — Module 2
TORONTO SECTION
In collaboration with Ryerson University,
the Toronto Section conducted a series of
technical guest presentations for the civil
engineering undergraduate class attending
the winter semester project management
course. The guest speakers from the
section’s board provided additional insight
and showcased practical examples from
their real life experiences on some of the
topics that were included in the project
management course curriculum, including:
estimating, construction contracts and
project delivery systems.
On January 30, the Toronto Section
conducted its first technical event of the
year 2020. Guest Speaker Andy Kervell,
from Arup, discussed how BIM process
and technology, when used properly,
can optimize project outcomes for all
stakeholders. The presentation featured a
case study from a largescale international
infrastructure project, where BIM was
implemented. The event took place at Toronto Section board member Ghaith Al-Hiyari, CCP, is shown above at the podium
the Casa Loma campus of George Brown presenting a brief introduction about AACE International and the Toronto Section activities
College in Toronto. at the beginning of one of the guest presentations at Ryerson University.
At the Toronto Section’s January meeting, guest speaker Andy Kervell, from Arup, is shown presenting the topic: “Using BIM to
Optimize Project Outcomes.”
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Jacobs Engineering Group Inc Planning and Cost Engineering Turner & Townsend
www.jacobs.com Services (Pty) Ltd www.turnerandtownsend.com
www.paceservices.co.za
JESA Value Management Strategies, Inc.
www.jesa.africa PMA Consultants, LLC vms-inc.com
pmaconsultants.com
JGC Corporation Williams Companies
www.jgc.com/en PMSOFT, JSC. co.williams.com
www.pmsoft.ru
Jianjing Investment & Williams Industrial Services Group, LLC
Consultation Co., Ltd. Quantum Global Solutions Canada
www.jjtz.cn qgs.global www.wisgrp.com
Koch Industries Inc Sargent & Lundy Metropolitan Water Reclamation District
www.kochind.com sargentlundy.com of Greater Chicago
mwrd.org
Land Transport Authority Savannah River Nuclear Solutions, LLC
www.lta.gov.sg www.savannahrivernuclearsolutions.com NYC Department of Design and
Construction
LyondellBasell Scheduling and Information Services, Inc. www1.nyc.gov/site/ddc/index.page
www.lyondellbasell.com 1sis.com
RB Rail AS
Michael Baker International SNC-Lavalin, Inc. www.railbaltica.org
www.mbakerintl.com www.snclavalin.com/en
Smithsonian Institution
MOCASystems Sound Transit www.si.edu/
moca-pm.com www.soundtransit.org
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CERTIFIED COST
In addition, AACE International salary surveys
reveal that Certified Cost Professionals earn PROFESSIONAL
more at all steps throughout their career than FOR MORE INFORMATION
those without certification. VISIT WEB.AACEI.ORG
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NEW AACE
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RECOMMENDED
!
PRACTICES
PUBLISHED
AACE® International Recommended Practice
100R-19: CONTRACT CHANGE
MANAGEMENT –
As Applied in Engineering,
Procurement, and Construction
Online Store
This study guide is intended to assist you in
your study and review of the overall topics
as one step toward successful Earned
Value Professional certification. The outline
SKILLS AND KNOWLEDGE OF COST provides a listing of the terms you should
ENGINEERING, 6TH EDITION know & topics for which you should have
Dr. Makarand Hastak, PE CCP, Editor, 2015 a good understanding of how to apply the
This publication provides information on a concepts to solve problems. Each chapter also con-tains sample
wide range of cost engineering subjects exercises, which test your knowledge of that chapter's concepts.
and will prove to be a valuable resource
to any individual seeking professional Digital Download - US$50.00 member/US$100.00 nonmember
growth or pursuing an AACE International Paper Version available through our Amazon.com link
certification. This publication offers six
sections comprising 34 chapters of THE TOTAL COST MANAGEMENT
content on topics such as cost estimating, project planning, value FRAMEWORK, 2ND EDITION
engineering, and strategic management, to name a few. H. Lance Stephenson, CCP FAACE, Editor,
2015
Digital Download - US$50.00 member/US$150.00 nonmember The TCM Framework is a structured,
Paper version available through our Amazon.com link annotated process map that explains each
practice area of the cost engineering field in
CCP CERTIFICATION STUDY GUIDE, the context of its relationship to the other
2ND EDITION practice areas including allied professions. It
Dr. Makarand Hastak, PE CCP, Editor, 2016 provides a process for applying the skills and
The AACE International CCP Certification knowledge of cost engineering.
Study Guide, 2nd Edition is designed
as a companion workbook to the Skills Digital Download - Free for members/US$150.00 nonmember
and Knowledge of Cost Engineering, Paper Version available through Amazon.com
6th Edition (S&K 6). In conjunction
with S&K 6, this study guide will assist COST ENGINEERS’ NOTEBOOK
individuals in their preparation for the CCP This CD-ROM is an important reference for any project or cost
Certification examination and develop the general knowledge professional. It includes data and procedures related to basic skills
a cost engineering professional is expected to have. This study and knowledge that all cost engineers should possess, extensive
guide offers insight into the key topics found in each chapter of material on capital and operating cost estimation, and papers in
S&K 6 and provides practice questions and exercises to develop four subject areas: cost control, planning and scheduling, project
knowledge in individual areas. management, and economic analysis and business planning.
Digital Download - US$50.00 member/US$100.00 nonmember Digital Download - US$50.00 member/US$100.00 nonmember
Paper version available through our Amazon.com link
AACE INTERNATIONAL RECOMMENDED PRACTICES
PSP CERTIFICATION STUDY GUIDE, Cost Engineering Terminology; Cost Estimate Classification
2ND EDITION System; Estimate Preparation Costs in the Process Industries;
AACE Education Board, 2018-2019 Project Code of Accounts; Required Skills and Knowledge of a Cost
This certification study guide aids Engineer; Roles and Duties of a Planning and Scheduling Engineer;
professionals wishing to achieve AACE Profitability Methods; plus many more.
International’s specialty certification in
Planning and Scheduling. Second, the Digital Download - FREE for members/US$100.00 nonmember
PSP Certification Study Guide summarizes
various topics considered central to the 2019 AACE INTERNATIONAL
planning and scheduling professional, as TRANSACTIONS
outlined in AACE International Recommended Practice 14R-90,
Responsibility and Required Skills for a Planning and Scheduling Digital Download - US$90.00 member/
Professional, along with the current edition of the Skills and US$115.00 nonmember.
Knowledge of Cost Engineering.
Articles announced for publication in the COST ENGINEERING Journal are subject to change.
Subscriptions to the COST ENGINEERING Journal are included with AACE® International
membership. For full membership benefits and discounts, become an AACE International
member today by visiting: web.aacei.org/membership
There is a virtual exhibit hall so you can learn what great products and services our exhibiting
firms have to offer. There will be social events - some topical in nature so that you can discuss
work-related issues, and some where it will just be for fun. Technical Committee and SIG meetings
will be held as well as a Rising Professionals’ Committee social hour.
You get 1.8 CEUs (continuing education units) for participating in the live portion plus more
for each recorded session you complete! You get all of the technical papers. You get all of the
recorded sessions, including the recordings of the live sessions, in your library to access for years
down the road.
The live sessions take place at the same time each day: (all times are listed in Eastern US):
• 11:00 AM - 12:00 PM
• 12:30 PM - 1:30 PM
• 2:00 PM - 3:00 PM
Estimating is fundamental to the ‘Assess’ & ‘Treat’ steps of risk management, as defined in AACE’s
Total Cost Management Framework (TCM) and Skills and Knowledge of Cost Engineering 6th
Edition (S&K6). Estimator skill is required to determine the cost impact of the risk (assess), and
the cost to implement the plan to address the risk (treat), respectively. The cost impact of the risk
contributes to the amount of contingency required. However, there are several facets of strategic
planning wherein the cost estimating process can introduce, assess, or mitigate risk.
This document addresses the topic of estimating as it pertains to risk and the various facets of
project risk, which can be affected by the cost estimate and the methods by which the estimates
are developed. This paper is aimed at the junior to intermediate cost engineering professional and
provides a single source for AACE references on this subject.
The authors, working for firms that provide engineering design services, have experience in
working with designers to develop the right level of detail for the design portion of a project, to
establish a stage-gate approach to design milestones so they can align with cost, schedule, and
risk monitoring, and so performance can be accurately measured. The authors bring a wide range
of perspectives, from Process Engineering design scheduling, to Design-Build A/E scheduling, to
CM Agency A/E monitoring, to CM at Risk A/E support scheduling. This paper will offer a proven
approach that demonstrates guidelines for schedule design, development, monitoring, analysis,
updating, and reporting, as well as set the benchmark to facilitate mitigation when necessary.
When simulating a project schedule, the analyst needs to represent the manager’s response to
delays as if there is still time to recover the schedule. Conditional branching can represent the
project manager’s response to a schedule event such as the detailed engineering’s finishing later
than anticipated by adding resources to shorten the execution phase to claw back the impending
schedule overrun.
During a Monte Carlo simulation conditional branching can test each iteration for missing a key
finish date. In the case study, a conditional branch is modeled with 2 possible plans. “Plan A” is the
original fabrication schedule, and “Plan B” is a recovery fabrication schedule. The paper describes
the logic simulating having a Plan B conditional branching and some results that may occur.
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