Management of construction projects is vitally important due to its direct influence on economy of a country and safety of building users. There is a significant example of wide-scaled construction in Saudi Arabia where well-planned complex of construction management allowed building an oasis in the underdeveloped desert (BBC 2009). On the other hand, there are facts when faults in application of construction standards and safety regulations led to catastrophic collapse. For instance, thousands of school children died in the earthquake that destroyed around 7,000 classrooms in Chinese province (Weiwei 2008). In this project I will explore the field of management in construction projects.
The project divided into four sections. Each section deals with a specific construction stage and aimed to give basic knowledge about specific methods and techniques of management that make construction more effective. Moreover, I highlighted main terms and procedures that normally have a place in the field of construction. In addition, in the project I described potential issues and risks and ways of its resolution.
2 Overview to management of construction projects
The management is a significant part of the construction projects which helps to organize and bring together materials, human and financial resources, operations such as planning, designing and construction. The main purpose of management is to complete the construction process in time and cost limits. By "construction" will be considered an act of creating, building of variety of structures such as housing, municipal and industrial buildings, roads, dams, bridges and tunnels. The project is a specified and well-planned construction. It consists of three main components. First, value and quality of work. Second, the cost of necessary materials and labor. Third, a schedule that refers to the time of construction. Construction projects consist of four main stages such as briefing, designing, construction and commissioning (Austen 1984: 5). This project describes different types of techniques and methods of project management that make construction more effective at its stages.
3 Briefing stage
At the briefing stage project management requires the collaboration among three participants: client, designer and contractor. First of all, the client's team provides overall directions concerning location, layout, equipment and services. The client gives the most appropriate requirements for him such as expected quantity and quality of work, permissible budget, and specifies the time constraints. In the event of material needs the client must provide the necessary resources. The project manager must meet with the client to set up the work plan and discuss details of contract documents. The designer team must be involved in the process of specification and development of the contract documents. The contracts should meet the client's time, cost and quality requirements. Moreover, the specified work on the contracts must be feasible by the contractor (McGeorge & Palmer 2002: 53). Any failure at this stage, consequently, can lead to wrong direction and future problems such as cost exceeds, overruns and delays.
Therefore, the designer's team must provide appropriate technical assistance and advice. The process of contract documents development must be controlled by the project management team. Experienced managers suggest that all savings and changes should be done prior to commencing the construction (Austen 1984: 10-11), (Clough 1991: 3).
4 Designing stage
The purpose of the designing stage is to complete the project brief, determine the design, total estimated budget and final time schedules. In addition, approved versions of working drawings must be prepared and all arrangements to the next stage completed (Austen 1984: 12). One of the most difficult tasks for the project management is project budgeting. The budget is the amount of money that the client spends for the design and construction (Oberlender 1993: 28). The client's team must specify the maximum and minimum cost limits of the design and construction. The designer's team must determine cost of performance design and arrange contract documents. The contractor's team must estimate all possible expenses for construction materials, equipment and labor.
4.1 Methods of project budgeting
There are two types of budget estimates for the client: approximate and detailed. The accuracy of these levels of estimating depends on its best assessment with real cost (Oberlender 1993: 30). For the designer's team it is difficult to estimate the cost of the design and producing the contract documents before the construction stage begins. The estimates are usually carried out using four following methods: lump-sum, salary cost times a multiplier, cost plus a fixed payment (Oberlender 1993: 38).
4.1.1 The lump-sum method
The lump-sum method is usually used for projects with well-defined quantity of work. Preparation of the budget can be developed by task determination and grouping. The cost of each task can be estimated based on the estimates for similar projects. Approximate estimated labor-hours of calculations, quantity of drawings, labor-hours per drawing and travel can be defined based on the manager's past experience. Finally, the total design cost can be estimated by summarizing the costs of all works.
4.1.2 The salary cost times a multiplier method
The salary cost times a multiplier method is used for the projects when the quantity of works is not accurately defined. In this event the designer's team provides the client with fee schedule that lists classification and salary costs for the staff, and all other works that may be charged from the project's budget. At the end total cost of design services can be calculated based on actual time spent (Oberlender 1993: 38)
4.1.3 The cost plus a fixed payment method
The cost plus a fixed payment method is used when the client provides an overall description of the project with well-defined quantity of work. The client must pay the cost of all services and salaries plus the fixed payment which varies from 10% for large and 25% for small projects (Oberlender 1993: 41).
4.2 Methods of project planning and scheduling
The purpose of the project planning is to complete the project on time. Also it is the first step in project scheduling. Different types of changes can occur during the construction. Changes in personnel, prices of equipment or design problems of structure can cause work interruptions and delays. Good project management should detect these changes and adjust them to the schedule. Moreover, it can prevent overruns and delays.
4.2.1 The Critical Path Method (CPM)
For effective and productive planning and scheduling the project management team normally uses network-based management procedure known as The Critical Path Method (CPM). The CPM is a graphical plan of work operations required for completion of the project and their order of implementation (Clough 1991: 18). It allows to be predicted the time needed for completion of entire project and each intermediate stage with high accuracy. CPM provides concise information concerning the sequence of construction procedures and calendar dates and a certain operation should be started and finished. In addition, CPM shows critically important operations that are essential for completing the project on time. The project manager is able to evaluate the time requirements of alternative methods of construction in the event of changes and delays.
4.2.2 The arrow notation system
The arrow notation system is used for planning and scheduling of construction operations by drawing of project networks. Each construction operation or activity is indicated as an arrow. Its start point shows the beginning of an activity and the head of the arrow indicates its completion. This system helps to show certain types of dependencies between activities. The sequence of activities is normally drawn to display the relationship of one activity to another. After preparation of the network diagram duration of each activity can be estimated. The duration of activity in its earliest and latest time must be given. It will allow to the project management team to estimate final completion date with a low level of difference, and to complete the whole construction on time (Clough 1991: 72).
It is essential for the manager to make sure that the sequence of procedures is well-planned and fulfilled. Nevertheless, there are different types of financial and time risks that can lead to delays and unexpected expenses. The purpose of project management is to forecast the risks and minimize their influence. The first possibility of risks is normally considered by the client and the management's team. Risk analysis in investment estimation deals with cases that can occur in the future. Potential returns of financial investments need to be forecasted. The most important risk is that investments may not be returned as expected. The method of Risk analysis provides a clear understanding of risks related to decision making between alternatives (Pilcher 1992: 170).
5 Construction stage
The construction stage is the most essential phase of the entire project. Most of resources and components are applied at this stage. Moreover, the final quality of the project directly depends on construction at the site. The purpose of the construction stage is to build a structure within arranged time and cost limits.
5.1 Time management and schedule planning
The project manager must plan, coordinate and control site operations. The construction planning covers time schedules with its subsequent monitoring, site organization, equipment and manpower plans, and material delivery (Austen 1984: 38). Time schedules that were made at the designing stage can not be implemented in some cases due to different circumstances, such as inclement weather, delays in material delivery, job accidents and equipment breakdowns. The management team must make significant efforts to control and analyze the progress of construction operations and undertake appropriate actions to bring the work in time with the schedule. Time management is normally based on job networks and schedules designed at the previous stage. Calendar dates for the start and completion of each activity must be calculated for day-to-day planning and controlling. This system provides an effective early warning tool to detect when and at which level the project may deviate from the schedule. The monitoring of time schedules is needed to measure and compare accomplishment dates of operations within the planned time.
In order to establish a hierarchy of schedules, schedules can be developed for the client, architect-engineers and the management team. The project manager must be provided with a list of key dates and activities in order to schedule monitoring. The contractor's team has to finish the construction in the designed period of time. In the event of delays the deadline for submission can be extended according to contract documents. The extension should be initiated by the contractor. The project manager must provide documentary justification, and determine who is responsible for delays and who will cover extra expenses. Schedule adjustment is not always possible therefore a simple rework of the overall plan may not be enough. In the event of serious delays project completion can exceed the time constraints. In cases when the client or subcontractors are responsible for delays, the contractor must be able to document the time extension and display the roles of responsible parties. In this case, a well-maintained network of construction operations can be an effective base is for analyzing the effects of delays and loss in total time (Clough 1991: 205).
5.2 Manpower management
Manpower management is based on labour requirements. The manpower is a crew of workers needed to maintain the planned project schedule. In planning manpower the project manager should follow the demands for labour for each activity and its available supply. The effective planning method is based on the evaluation of activities and specifically diverting labour from non-critical to critical activities. The manager can thus allocate available labor to different activities and minimize the time exceeds. Planning for the number of construction workers can be started by tabulating labor requirements for each activity. Manpower is estimated for each activity by multiplying the quantity of work by number of workers required. Total manpower need is calculated by summarizing all estimated labor workers.
5.3 Equipment management
On construction projects the implementation of plans and effective accomplishment of the schedule also depends on the quality of equipment management in the field. The management team must make proper selection of equipment. Moreover, it should provide a plan of the use and maintenance of the equipment on the job. Selected equipment should be able to demonstrate its best performance under specific work conditions. The manager has to meet up with senior mechanic and equipment suppliers to arrange required equipment delivery and to set up a plan of maintenance and repairs. In addition, regular fueling and exchanging of oils should be scheduled to reduce the risk of equipment breakdown. The management team should be informed about the exploitation of equipment by field supervisors. In some cases contractors may tend to overload equipment to achieve higher productivity. However, it may lead to unexpected breakdowns and consequently, to expensive repairs and shortage of the equipment's working life (Clough 1991: 172).
The equipment schedule can be presented as a bar chart with calendar dates of works that require the usage of equipment. It enables the manager to know which equipment should be rented or bought for each type of activity. Management of construction equipment requires the application of the computers. Scheduling of numerous activities and involving separate resources may be very complex. For instance, twenty units of some equipment may be used in up to hundred network activities, each having its own schedule.
5.4 Material management
Material management includes the ordering of materials and control of delivery. Prior to making an order the management team must determine the required quantity and appropriate quality of materials. Moreover, price, delivery date and ways of transportation must be negotiated and established. An indication of time constraints is vitally important because delays in delivery can cause delays of the entire project and financial overruns. Time for production, shop-drawings and delivery to the job site should be included in the overall time schedule. The first order should be made immediately after signing the contract. It is the responsibility of the project manager to consider safety factors and make an early order to ensure that materials will be delivered at arranged time. The extra time is essentially in case of unforeseen circumstances. Nevertheless, materials should not be ordered excessively early, otherwise, they may be unneeded and, consequently, damaged, stolen or lose their quality. Moreover, it can involve extra expenses for storage and insurance. The management team should provide a classification of activities as a matter of priority. In the event of delays in material delivery for the most important activities the manager must immediately contact suppliers to identify the problem and to find a possible solution. In terms of forecasting and monitoring the project manager normally organizes weekly meetings with contractors and suppliers (Clough 1991: 176-177).
5.5 Job-site safety
Construction includes many types of hazards such as heat, wind, dust, noise, vibrations and toxic chemicals (Oberlender 1993: 163). And so construction job-site safety is vitally important part of the project management, as well as planning, budgeting, scheduling and any other project work. It must be applied at all project stages. The site safety should not be just included in a project, but designed and monitored throughout the project. Workers can be injured or even die due to unsafe behavior and disobeying the safety rules (Barrie 1978: 331). Safety actions, according to construction safety standards, must be taken to protect crew and equipment from these hazards. In terms of the site safety the project manager must provide a safe environment and equipment such as refuge ways, safety signs, stairs and barrier nets, uniform and respirators. Moreover, proper training of staff and first aid facilities must be provided on the job-site (Galeton 2006). Finally, it is important to emphasize an economic aspect of the job-site safety. Regarding equipment breakdowns, extra expenses can be involved or it can lead to the loss of property. Accidents related to workers involve medical costs, compensation benefits and legal liability. According to experienced managers, job-site safety management should consider productivity and safety as related parts of high job performance (Oberlender 1993: 163).
6 Commissioning stage
The purpose of the commissioning stage is to ensure that project is completed according to the contract documents and that all facilities work properly (Austen 1984: 15-16). This stage is normally controlled by the management team and the client's representative. The client requires the testing all equipment: water, sewer and power systems before the final closure of construction. The project manager must co-operate with contractors and designers to define responsible parties for each vessel and item of equipment. The inspection of a piece of equipment or vessel can be made separately and, consequently, authorized and accepted by the client.
6.1 Final inspection
Before the end of the project the client requests the final inspection. Prior to the request the manager should prepare a list of items that should be tested and provide several walk-through inspections. After the testing and adjusting equipment and vessels the management team and designers must prepare operating instructions and maintenance manuals. In addition, the future personnel of the building should be trained and inducted. Finally, the project manager must schedule and conduct the final walk-through inspection before starting up the building. After the inspection and acceptance by the client, the contractor may issue a Certificate of Substantial Completion with an attached list of deficiencies. In following 30-40 days, after the elimination of deficiencies, the client provides the final payment (Oberlender 1993: 170). Prior to the payment warranties and lien releases, which are agreements between the client and the contractor under which debt obligation remains in force, should be signed which must be prepared by the management's team (BusinessDictionary.com 2009).
According to the contract documents it is required that the contractor guarantees proper working of all equipment, vessels and materials without any defects during next year. In the events of breakdowns or defects all the expenses for repairing and replacing of spare parts should be covered by the contractor. The project manager must ensure that instructions, spare parts, manuals and certificates are handed to the client before signing a Certificate of Final Completion and final payment (Oberlender 1993: 173).
6.3 A lien release
In some cases in spite of a full payment of the client to the general contractor, material suppliers, subcontractors and workers may not get their payments. They have a right to file a lien, even if the general contractor got the full contract amount. It can lead to repayment of the client. Therefore, the project manager must ensure that all liens are released before the final payment.
Throughout the project the management team has to make records of any changes related to original drawings. For instance, changes of routes of water and heat pipes, electrical cables, utilities or any hidden work. The recording can be used for the resolution of disputes or misunderstandings between the client, contractors and the designer team
The aim of this project was to introduce the reader with main concepts of management in construction projects. I made an attempt to show direct correlation between management techniques and construction procedures and how they can be made more effective. This paper revealed new understanding of whole construction chain as a process with very close dependant activities and stages that should be well-organized and managed. The importance of involvement of project management team in decision making processes is become clearer. Throughout the project it is emphasised that any delays or mistakes of the construction procedures can led to delays of entire project. I suggest that these ways of management can be developed and this subject should be taken for more wide and deep studies.
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