Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
Manuals and Reports on Engineering Practice No. 73 Quality in the Constructed Project A Guide for Owners, Designers, and Constructors Second Edition 2000
= eae eooe = : eS = . aaa ; - ae puttere”<n) 4 MANUALS AND REPORTS ON ENGINEERING PRACTICE NO.73 QUALITY IN THE CONSTRUCTED PROJECT A GUIDE FOR OWNERS, DESIGNERS,AND CONSTRUCTORS SECOND EDITION ASCE Published by the American Society of Civil Engineers 1801 Alexander Bell Drive Reston,Virginia 20191-4400 Abstract This Second Edition of Quality in the Constructed Project:A Guide for Owners,Designers,and Constructors (ASCE Manual No.73)provides information and recommendations on principles and procedures that are effective in enhancing the quality of constructed projects.This Guide discusses the roles,responsibilities,requirements,and limits of authority of participants in the design and construction process,highlighting concepts and practices that are valuable to each in achieving project goals and objectives.This Guide presents several key themes,including the value of clearly defining and assigning responsibilities,the importance of teamwork,the need for clear contractual provisions,strategies for good communication,the owner's selection process for other team members,the potential benefits associated with various project delivery systems,and procedures for managing design and construction. Library of Congress Cataloging-in-Publication Data American Society of Civil Engineers. Quality in the constructed project:a guide for owners,designers,and constructors.-2nd ed. p.cm.-(Manuals and reports of engineering practice;no.73) Includes bibliographical references and index. ISBN 0-7844-0506-9 1.Engineering-Management-Handbooks,manuals,etc.2.Building-Quality control- Handbooks,manuals,etc.3.Civil engineering-Specifications-Handbooks,manuals,etc.I.Title. II.ASCE manuals and reports on engineering practice ;no.73. TA190 .A54 2000 624'.068-dc21 00-034251 The material presented in this publication has been prepared in accordance with generally recognized engineering principles and practices,and is for general information only.This infor- mation should not be used without first securing competent advice with respect to its suitability for any general or specific application. The contents of this publication are not intended to be and should not be construed to be a standard of the American Society of Civil Engineers (ASCE)and are not intended for use as a reference in purchase of specifications,contracts,regulations,statutes,or any other legal document. No reference made in this publication to any specific method,product,process,or service constitutes or implies an endorsement,recommendation,or warranty thereof by ASCE. ASCE makes no representation or warranty of any kind,whether express or implied,concerning the accuracy,completeness,suitability,or utility of any information,apparatus,product,or process discussed in this publication,and assumes no liability therefor. Anyone utilizing this information assumes all liability arising from such use,including but not limited to infringement of any patent or patents. Photocopies:Authorization to photocopy material for internal or personal use under circumstances not falling within the fair use provisions of the Copyright Act is granted by ASCE to libraries and other users registered with the Copyright Clearance Center (CCC)Transactional Reporting Service, provided that the base fee of $8.00 per chapter plus $.50 per page is paid directly to CCC,222 Rosewood Drive,Danvers,MA 01923.The identification for ASCE Books is 0-7844-0506- 9/00/$8.00 +$.50 per page.Requests for special permission or bulk copying should be addressed to Permissions &Copyright Department,ASCE. Copyright ©2000 by the American Society of Civil Engineers. All Rights Reserved. Library of Congress Catalog Card No:00-034251 ISBN 0-7844-0506-9 Manufactured in the United States of America MANUALS AND REPORTS ON ENGINEERING PRACTICE (As developed by the ASCE Technical Procedures Committee,July 1930,and revised March 1935,February 1962,and April 1982.) A manual or report in this series consists of an orderly presentation of facts on a particular subject,supplemented by an analysis of limitations and appli- cations of these facts.It contains information useful to the average engineer in everyday work.It is not in any sense a "standard,”nor is it so elementary or conclusive as to provide a "rule of thumb”for non-engineers. Furthermore,material in this series,as different from a paper (which expressed only one person's observations or opinions),is the work of a group selected to assemble and express information on a specific topic.As often as practi- cable,the committee is under the direction of one or more of the Technical Divisions and Councils,and the product evolved has been subjected to review by the Executive Committee of the Division or Council.As a step in the process of this review,proposed manuscripts are brought before the mem- bers of the Technical Divisions and Councils for comment,which may serve as the basis for improvement.When published,each work shows the names of the committees by which it was compiled and indicates clearly the several processes through which it has passed in review,in order that its merit may be definitely understood. In February 1962 (and revised in April 1982)the Board of Direction voted to establish: A series entitled "Manuals and Reports on Engineering Practice,”to include the Manuals published and authorized to date,future Manuals of Professional Practice,and Reports on Engineering Practice.All such Manual or Report material of the Society would have been refereed in a manner approved by the Board Committee on Publications and would be bound,with applicable discussion,in books similar to past Manuals. Numbering would be consecutive and would be a continuation of pres- ent Manual numbers.In some cases,reports of joint committees,may be authorized to bypass Journal publications. MANUALS AND REPORTS OF ENGINEERING PRACTICE No.Title 13 Filtering Materials for Sewage Treatment Plants 14 Accommodation of Utility Plant Within the Rights-of-Way of Urban Streets and Highways 35 A List of Translations of Foreign Literature on Hydraulics 40 Ground Water Management 4l Plastic Design in Steel:A Guide and Commentary 45 Consulting Engineering:A Guide for the Engagement of Engineering Services 46 Pipeline Route Selection for Rural and Cross-Country Pipelines 47 Selected Abstracts on Structural Applications of Plastics 49 Urban Planning Guide 50 Planning and Design Guidelines for Small Craft Harbors 51 Survey of Current Structural Research 52 Guide for the Design of Steel Transmission Towers 53 Criteria for Maintenance of Multilane Highways 55 Guide to Employment Conditions for Civil Engineers 57 Management,Operation and Maintenance of Irrigation and Drainage Systems 59 Computer Pricing Practices 60 Gravity Sanitary Sewer Design and Construction 62 Existing Sewer Evaluation and Rehabilitation 63 Structural Plastics Design Manual 64 Manual on Engineering Surveying 65 Construction Cost Control 66 Structural Plastics Selection Manual 67 Wind Tunnel Studies of Buildings and Structures 68 Aeration:A Wastewater Treatment Process 69 Sulfide in Wastewater Collection and Treatment Systems 70 Evapotranspiration and Irrigation Water Requirements 71 Agricultural Salinity Assessment and Management 72 Design of Steel Transmission Pole Structures 73 Quality in the Constructed Project:A Guide for Owners,Designers,and Constructors 74 Guidelines for Electrical Transmission Line Structural Loading 716 Design of Municipal Wastewater Treatment Plants 77 Design and Construction of Urban Stormwater Management Systems 78 Structural Fire Protection 79 Steel Penstocks 80 Ship Channel Design 81 Guidelines for Cloud Seeding to Augment Precipitation 82 Odor Control in Wastewater Treatment Plants 83 Environmental Site Investigation 84 Mechanical Connections in Wood Structures 85 Quality of Ground Water 86 Operation and Maintenance of Ground Water Facilities 87 Urban Runoff Quality Manual 88 Management of Water Treatment Plant Residuals 89 Pipeline Crossings 90 Guide to Structural Optimization 91 Design of Guyed Electrical Transmission Structures 92 Manhole Inspection and Rehabilitation 93 Crane Safety on Construction Sites 94 Inland Navigation:Locks,Dams,and Channels 95 Urban Subsurface Drainage 96 Guide to Improved Earthquake Performance of Electric Power Systems 97 Hydraulic Modeling:Concepts and Practice 98 Conveyance of Residuals from Water and Wastewater Treatment 99 Environmental Site Characterization and Remediation Design Guidance PREFACE TO THE SECOND EDITION he idea for this Guide arose during a series of meetings in 1983-1985 among leaders of the design and construction industry who convened to discuss opportunities to improve quality in constructed projects.The group decided that the American Society of Civil Engineers (ASCE)would develop and publish a guide with information and recommendations geared toward helping people improve the quality of the projects they own,design,and/or construct. In 1987,ASCE published a Preliminary Review Draft of the Guide that was distributed to more than 1,000 professionals,including owners,design pro- fessionals,constructors,agency personnel,legal experts,educators,and oth- ers.Their comments were addressed and incorporated into a Trial Use and Comment Edition,published in 1988 and purchased by more than 15,000 peo- ple in the construction industry.The Trial Use and Comment Edition yielded approximately 1,500 additional comments,which were addressed in the First Edition,published in 1990.In 1997,ASCE appointed a committee to update the Guide for the Second Edition,to be published in 2000. This Second Edition carries on the originators'intent that the Guide be a liv- ing document.The Committee to Update Manual 73 worked with authors to produce four new or entirely rewritten chapters that address important indus- try changes during the last decade: «"Project Delivery Systems”(Chapter 3); «"Computers and Project Quality”(Chapter 21); *"Partnering”(Chapter 24); "Value Engineering”(Chapter 25). In addition,reviewers updated the existing chapters from the First Edition. The new and updated chapters were reviewed by representative groups of owners,design professionals,and constructors.The entire Guide was then reviewed by the appointed committee,13 professional associations,a forum of legal experts,and a peer review team.Altogether,more than 125 indus- try professionals have participated in producing the Second Edition that is before you. This Second Edition also includes new features to increase the day-to-day utility of the Guide,including summaries of project participant activities for each chapter,a page layout format to provide space for notes,more references to relevant publications and Internet resources,and Internet links to the lat- est editions of standard form contract documents. This Guide is written primarily for the three principal project participants in a traditional design-bid-build (DBB)project-the owner,design professional, and constructor.It is also intended to be valuable to other project participants, including regulatory agency staff,subcontractors,subconsultants,and sup- pliers,as well as educators and students.Topics are organized in approxi- mate project chronology,beginning with the owner's role and the selection of a project delivery system,the selection of other team members,design, construction,start-up,and operations and maintenance. This Guide also highlights areas in which alternate forms of project delivery, such as design-build,may shift project responsibilities and risks to different participants.In cases where the Guide describes functions that would typi- cally be performed by many people on larger projects,the reader may infer that these functions may be carried out by one person or a few people on smaller projects. This Guide is not a substitute for the exercise of good judgment by the owner, designer,and constructor,nor should the procedures suggested in any way affect the specific contractual provisions governing a particular project.Users of this Guide are advised to consult knowledgeable and experienced legal counsel concerning the subjects addressed herein. ASCE will continue to revise this Guide at appropriate intervals;comments are welcome at any time.Please address comments in writing to the Professional Practices Division,ASCE,1801 Alexander Bell Drive,Reston, VA 20191,or via the Internet at www.asce.org.O ACKNOWLEDGMENTS ASCE Board of Direction Delon Hampton,Ph.D.,P-E.,President James E.Davis,P.E.,Executive Director and CEO ASCE Committee for the Update of Manual 73 R,Lawrence Whipple,P.E.,Chair,Cornerstone Consultants Edward DiTomas,Turner Construction Michael Goodkind,P-E.,Alfred Benesch &Company William P.Henry,P.E.,Moffatt &Nichol Engineers Donald H.Kline,P.E.,Kimley-Horn and Associates,Inc. Joseph A.Kurrus,P.E.,Avista Corporation Robert Nicol,P.E.,Operational Technologies Corporation Legal Review Forum Robert Rubin,Chair,Postner &Rubin Richard Crowell,DPIC Companies Gary Gough,Ames &Gough Insurance and Risk Management David Hatem,Burns &Levinson,LLP Bryan Hickey,Haynsworth,Marion,McKay &Guerard,LLP Paul Lurie,Schiff Hardin &Waite Ronald Martell,Moore Costello &Hart Robert Meyers,Jones,Day,Reavis &Pogue Robert Smith,Wickwire Gavin,P.C. Thomas Smith,ASCE Peer Review Team Luther Graef,P.E.,Graef,Anhalt,Schloemer &Associates,Inc.,Past President,ASCE William Henry,P.E.,Past Chair,ASCE Committee on Professional Practice Maria Lehman,P.E.,County of Erie,Past Board Member,ASCE H.Gerard Schwartz,Ph.D.,P.E.,Sverdrup Civil,Inc.,Chair,ASCE Committee on Professional Practice ASCE Staff Gretchen Hyde,Manual 73 Administrator Editor David Elvin,Elvin Strategic Writing,Inc. vii Contributing Authors John Belvedere,P.E.,CH2M Hill,Inc. Sue Dyer,Orgmetrics Paul H.Gilbert,PE.,N.A.E.,Parsons Brinckerhoff International,Inc. Howard B.Greenfield,PE.,CVS,Lewis &Zimmerman Associates,Inc. John F.Hill,AIA,Systems Management Consultants Charles Hodge,Boyle Engineering Corporation Michael P.Ingardia,P.E.,Systems Management Consultants,Inc. Muthiah Kasi,Alfred Benesch &Company Roger Lang,AIA,Turner Construction Richard McKim Preston,Seyfarth,Shaw,Fairweather &Geraldson Eric G.Mion,Lewis &Zimmerman Associates,Inc. Brian L.Ray,P-E.,Kittelson &Associates,Inc. Norman Scott,Consulting Engineering Group Robert Smith,Wickwire Gavin,PC. Jennifer Starrman,Barton Malow Company Stephen G.Walker,Esq.,P.E.,Bechtel Corporation Bruce Wiggins,Orgmetrics Chapter Reviewers Steve Anderson,Anderson Perry & Associates,Inc. Tore Arnesen,Arnesen &Associates Richard Berry,Rembco Geotechnical Contractors,Inc. Ida B.Brooker,Boeing Company James Brown,Malcolm Pirnie,Inc. Jerry D.Brown,P.E.,East Bay Municipal Utility District Richard Bryan,H.B.Zachry Company Gerard P.Cavaluzzi,Esq.,Malcolm Pirnie,Inc. Laura E.Champion,P.E.,Gibble Norden Champion Consulting Engineers,Inc. Stephen W.Cole,P.E.,S.W.Cole Engineering,Inc. Ray Darvish,P.E.,CH2M Hill,Inc. Ronald Daye,OWP&P Architects,Inc. Gregory DiLoretto,Tualatin Valley Water District Eric T.Dodge,P.E.,Malcolm Pirie, Inc. Robert Douglas,Maryland Department of Transportation Joseph W.Eberle,P.E.,Ruekert & Mielke,Inc. Moon A.Fahel,P.E.,H.B.Zachry Company Edward R.Fisk,P.E.,LS,E.R.Fisk Consulting Engineer Bennett Greenberg,Seyfarth,Shaw, Fairweather &Geraldson viii Christopher Liakakos,OWP&P Architects,Inc. Russell Louderback,Kite Development Michael Loulakis,Wickwire Gavin, PC. Robert A.Manning,P.E.,H-E-B Grocery Company Felix Martinez,American Consulting Engineers Council Mark L.McAlpine,J.D.,McAlpine & McAlpine,P.C. William J.Mielke,P.E.,RLS,DEE, Ruekert &Mielke,Inc. James L.Mohart,P.E.,Black &Veatch Corporation John E.Newby,P.E.,Camp Dresser & McKee,Inc. James J.O'Brien,P.E.,O'Brien Kreitzberg,Inc. Thomas Ogee,Union Pacific Railroad John V.O'Holleran,P.E.,HNTB Corporation Richard O'Neil,Davidson &Troilo, PC. Gary Parks,Bonneville Power Administration Richard Patton,Turner Construction Rodney Plourde,McMahon & Associates Barbara Proft,City of Olympia, Washington Bruce Rawls,County of Spokane, Washington David H.Grieves,P.E.,Chavez- Grieves,Consulting Engineers,Inc. William Gurry,Gurry Associates George D.Gustafson,P.E.,Earth Tech, Inc. David P.Gustafson,Ph.D.,P.E.,S.E., Concrete Reinforcing Steel Institute Paul Haglund,Greeley and Hansen Norman T.Heinig,CIPE,Heinig Consulting Engineers,Co. Kenneth W.Henderson,P.E.,Malcolm Pirnie,Inc. Lars H.Hendron,P.E.,City of Spokane,Washington Judith Jones,P.E.,Christy/Cobb,Inc. Ramanuja C.Kannan,P.E.,R.C. Kannan &Associates,Inc. Lynn Kitchen,Operational Technologies Corporation Thomas G.Krzewinski,P.E.,American Engineering Testing,Inc. Joel P.Leisch,P.E.,Transportation Systems Planning Andrew C.Lemer,Ph.D.,Matrix Group International,LLC Organizational Reviewers American Consulting Engineers Council Leo Peters,P.E. American Institute of Steel Construction Charles Carter,P.E. American Public Works Association Ramankutty Kannankutty,PE. James Martin,P.E. Dennis H.Ross,P.E. American Society for Quality ASFE Mark Roetzel,P.E.,Operational Technologies Corporation Lawrence H.Roth,P.E.,G.E., Subsurface Consultants,Inc. Herb Saunders,P.E.,Lakeside Project Services,Inc. Wilson So,So Associates Joel V.Stauber,AIA,AICP,OWP&P Architects,Inc. Frederick Sumner,P.E.,Hubbard Construction Company Thomas Tarpy,S.D.Lindsey & Associates Richard Tomasetti,Thornton Tomasetti Engineers Thomas Warne,Utah Department of Transportation Robert Weisman,P.E.,Palm Beach County,Florida Cecil Whitaker,Samuel L.Moore & Associates Les Wiersen,CH2M Hill,Inc. J.Alan Wilson,P.E.,Black &Veatch Corporation J.Anthony Wintz,III,P.E.,Esq.,ASCE Associated General Contractors of America Damian Hill,PE. Construction Industry Institute Construction Specifications Institute F.J.Klemeyer,Jr. Tom Deines Ross G.Spiegel Sheldon Wolfe National Institute of Standards and Technology National Society of Professional Engineers Robert Miller,P.E. ASCE Construction Division Edward Ardery,P.E. Melbourne Garber,P.E. Frank Lynch,P.E. Cliff Schexnayder,P.E. Stuart Williams,P.E. TABLE OF CONTENTS EXECUTIVE SUMMARY XV CHAPTER 1:INTRODUCTION 1.1 The Members of the Project Team 1 1.2 Team Member Requirements 2 1.3 Team Member Responsibilities 3 1.4 Defining Key Terms 4 1.5 Balancing Team Member Requirements 6 1.6 The Obligations of Team Members 6 1.7 Principal Themes of This Guide 7 CHAPTER 2:THE OWNER'S ROLE AND REQUIREMENTS 2.1 The Owner's Role 9 2.2 Project Goals 10 2.3 Achieving Project Goals 10 2.4 Establishing Project Objectives 10 2.5 Team Member Requirements 12 2.6 Timing and Duration of Participation 12 CHAPTER 3:PROJECT DELIVERY SYSTEMS 3.1 Owner-Provided Delivery 16 3.2 Traditional Design-Bid-Build 17 3.3 Construction Management 18 3.4 Design-Build 19 3.5 Design-Build Variations 21 3.6 Fast-Tracking:A Distinction 23 CHAPTER 4:THE PROJECT TEAM 4.1 Traditional Team Organization and Variations 25 4.2 The Owner's Team 26 43 The Design Professional's Team 29 44 The Constructor's Team 30 4.5 Common Interests 31 CHAPTER 5:COORDINATION AND COMMUNICATION 5.1 Key Team Members 33 5.2 Developing Coordination Processes 34 5.3 Team Member Relationships 34 5.4 Characteristics of Good Communication 36 5.5 Timing and Critical Moments 40 5.6 Frequency of Communication 41 5.7 Conflict and Disagreement 41 xi CHAPTER 6:SELECTING THE DESIGN PROFESSIONAL 6.1 Project Goals and the Design Professional's Scope of Services 43 6.2 Qualifications-Based Selection (QBS)44 6.3 Competitive Bidding 48 6.4 Two-Envelope Selection 49 CHAPTER 7:AGREEMENT FOR PROFESSIONAL SERVICES 71 Purpose of the Professional Services Agreement 54 7.2 Elements of the Agreement 54 73 Standard-Form Agreements 59 74 Short-Form Agreements 60 75 Other Design Contracts 61 7.6 Cautions Concerning Non-Traditional Contracting Relationships 63 CHAPTER 8:ALTERNATIVE STUDIES AND PROJECT IMPACTS 8.1 Project Conceptualization 68 8.2 Existing Conditions and Future Needs Analysis 68 8.3 A Framework for Developing Conceptual Alternatives 69 8.4 Investigating and Selecting Conceptual Alternatives 70 8.5 Environmental Documentation and Permitting 75 8.6 Public Involvement 77 CHAPTER 9:PLANNING AND MANAGING DESIGN 9.1 Organizing for Design 79 9.2 The Design Team 81 9.3 Project Design Guidelines 83 9.4 Coordination and Communication During Design 83 9.5 Monitoring and Controlling Design Cost and Schedule 84 CHAPTER 10:DESIGN DISCIPLINE COORDINATION 10.1 Levels of Design Discipline Organization 87 10.2 Design Disciplines and Project Objectives 88 10.3 General Design Team Coordination Considerations 91 10.4 Role of the Professional Discipline Leader During Design 92 10.5 Role of the Design Professional During Construction 93 CHAPTER 11:GUIDELINES FOR DESIGN 11.1 Office Operation 95 11.2 Design Procedures 97 11.3 Design Activities and Responsibilities 98 11.4 Compliance with Codes and Standards 102 11.5 Regulatory Permits and Approvals 103 11.6 Public Funding 103 11.7 Design Responsibility 103 CHAPTER 12:PRE-CONTRACT PLANNING FOR CONSTRUCTION 12.1 Assessing the Owner's Capabilities 107 12.2 Resources for Quality Construction 108 12.3 Regulatory Requirements 111 12.4 Site Development 111 12.5 Reviewing Design and Construction Alternatives 112 12.6 Construction Contract Arrangements 113 xii CHAPTER 13:THE CONSTRUCTION TEAM 13.1 13.2 13.3 13.4 CHAPTER 14:PROCEDURES FOR SELECTING THE 14.1 14.2 14.3 14.4 14.5 CHAPTER 15:THE CONSTRUCTION CONTRACT Functions of the Construction Contract Relating to Quality Role of the Design Professional in the Construction Contract Defining and Preparing the Construction Contract Documents 15.1 15.2 15.3 15.4 15.5 Assembling the Construction Team Contracting Strategies and Team Organization On-site Construction Team Representatives Construction Specialty Advisers CONSTRUCTOR Selection Procedures and Qualifications Constructor Qualifications Selection By Competitive Bidding Selection Procedures for Competitive Negotiated Contracts Selection Procedures for Noncompetitive Negotiated Contracts Industry Standard Construction Contract Documents International Construction Contracts 115 116 117 121 123 124 125 128 129 131 132 132 133 133 CHAPTER 16:PLANNING AND MANAGING CONSTRUCTION 16.1 16.2 16.3 16.4 Organizing for Construction Pre-Construction Meetings Construction Activities Coordination and Communication CHAPTER 17:CONSTRUCTION CONTRACT 17.1 17.2 17.3 DOCUMENTATION AND SUBMITTALS Roles and Coordination Contract Documentation Technical Submittals CHAPTER 18:CONSTRUCTION CONTRACT 18.1 18.2 18.3 18.4 18.5 18.6 18.7 18.8 ADMINISTRATION Resident Project Representative (RPR) Quality Objectives Job Site Safety Payment Constructor Submittals Change Orders Coordination of Activities Documentation CHAPTER 19:OPERATION AND MAINTENANCE 19.1 19.2 19.3 19.4 19.5 Achieving Quality in O&M O&M During Planning and Design O&M During Construction O&M During Start-Up Operation xiii 137 139 141 145 149 153 154 163 164 166 166 171 171 172 172 177 178 179 180 182 CHAPTER 20:QUALITY ASSURANCE AND QUALITY CONTROL 20.1 The Owner's Role 20.2 The Design Professional's QA/QC Process 20.3 The Constructor's QA/QC Process CHAPTER 21:COMPUTERS AND PROJECT QUALITY 21.1 Common Computer Uses 21.2 Computers and the Owner 21.3 Computers and the Design Professional 21.4 Computers and the Constructor 21.5 Internet Resources CHAPTER 22:PEER REVIEW 22.1 General Features 22.2 Types and Benefits of Peer Review 22.3 Procedural Elements of Peer Review 22.4 Responsibility 22.5 Peer Review Programs and Resources 185 186 189 193 195 196 198 200 203 204 206 210 210 CHAPTER 23:RISK,LIABILITY,AND AVOIDING CONFLICT 23.1 Project Risks 23.2 Managing Risk 23.3 Risk Management Tools 23.4 Liability 23.5 Avoiding Conflict 23.6 Conflict Resolution 23.7 Litigation CHAPTER 24:PARTNERING 24.1 Benefits of Partnering 24.2 Principles of Partnering 24.3 Elements of Partnering 24.4 Special Applications of Partnering CHAPTER 25:VALUE ENGINEERING 25.1 The Concept of Value 25.2 The Benefits of VE 25.3 The Timing of VE Studies 25.4 VE Team Composition and Qualifications 25.5 Stages of VE Study 25.6 Additional VE Considerations GLOSSARY ACRONYMS INDEX xiv 213 214 218 220 220 221 222 225 228 229 234 239 239 240 243 244 250 253 262 264 EXECUTIVE SUMMARY his Guide discusses principles and procedures that,in the experience of the authors and reviewers,are effective in achieving quality in constructed facilities.It is written for project owners,design professionals,and construc- tors.Other project participants,such as regulatory agency personnel,subcon- tractors,subconsultants,and suppliers,may also find this guide useful.The material focuses on the typical requirements,responsibilities,roles,relationships, and limits of authority of the principal participants in constructed projects. In this Guide,the principal members of the project team are the owner,designprofessional,and constructor.Topics are generally approached from the per-Quality in the Constructed spective of traditional design-bid-build (DBB)project delivery,the widely used form of contracting under which the design professional and the con- structor are individually bound to the owner and their respective responsibil-"aspirational”guide. ities specified by separate contractual agreements. Project is an On some projects,alternate forms of project delivery,such as design-build (wherein a single entity performs both design and construction)can enhance overall quality.Therefore,while this Guide usually discusses project activi- ties from the DBB perspective,it also notes instances under alternate forms of project delivery in which team members may be responsible for tasks other than,or in addition to,those described. Given its broad intended readership,this Guide is an "aspirational”document with the goal of educating readers and stimulating them to identify areas where they may raise the quality level of their involvement in the design and con- struction process.This Guide is not a technical standard,nor a compilation of standard industry practices. Quality is defined as the fulfillment of project responsibilities in the delivery >Chapter 1,"Introduction” of products and services in a manner that meets or exceeds the stated require- ments and expectations of the owner,design professional,and constructor. Responsibilities refer to the tasks that a participant is expected to perform to accomplish the project objectives as specified by contractual agreement and applicable laws,codes,standards,and regulatory guidelines.Requirements are what a team member expects or needs to receive during and after his or her participation in a project. This definition of quality hinges on the degree to which the requirements of project participants are met.Therefore,this Guide focuses on practices and procedures that encourage participants to express their requirements with clarity. XV >Chapter 2,"The Owner's Role and Requirements” >Chapter 4,"The Project Team” >Chapter 3,"Project Delivery Systems” >Chapter 5,"Coordination and Communication” >Chapter 6,"Selecting the Design Professional” PROJECT ORGANIZATION A successful project begins with the owner.As the first member of the proj- ect team,the owner identifies the need for a project,establishes the main goals, selects the other team members,defines the basic allocation of risk among project participants,and communicates the project goals to the other team members.The owner also secures funding and pays for the services of the other participants. In the early stages of project development,the owner is responsible for a fundamental decision:the selection of an appropriate project delivery system. While DBB remains the predominant system for organizing a project team, other forms of project delivery may better meet the owner's needs,including: *Owner-provided.The owner performs all design activities and acts as a general contractor,hiring construction subcontractors as needed. *Program manager.The owner hires a single entity to extend his or her capabilities in planning,design,and/or construction management to complete the project. ¢Design-build.The owner hires a single entity to complete both design and construction. ¢Design-build variations.The owner hires a design-builder who may also share the project's financial risk and/or operate the facility for a specified period before turning the facility over to the owner. Fast-tracking is not a form of project delivery.Rather,it is a management strategy that can be utilized within the delivery systems listed above in which the construction of underlying elements begins before design is complete for elements that are to be built later.Fast-tracking is most commonly undertaken on design-build projects (see 3.6 "Fast-Tracking:A Distinction”). The coordination of project activities under any method of delivery is essen- tial to project quality.Coordination depends on the ability of participants to tailor their communications to the project delivery system being used. To help improve the quality of decisions during the early stages of a project, the owner may engage the design professional before specific objectives have been developed to acquire additional planning expertise in project conceptu- alization,design,and construction.The owner may further enhance the effec- tiveness of early project decision making by seeking advice on legal, insurance,financial,real estate,land use,and other matters,in addition to procuring design and construction services. SELECTING THE DESIGN PROFESSIONAL The owner's criteria and process for selecting the design professional (or design-builder)have a major impact on project quality.A negotiated owner- design professional services agreement reached through qualifications-based selection (QBS)procedures provides the most flexibility in exploring solutions Xvi to design problems.This ultimately helps control project cost and improve quality.Under the QBS process,the owner: ¢Establishes a procedure for requesting and evaluating the qualifications of interested design professionals; *Receives and evaluates the qualifications of design professionals and develops a short list of candidates to design the project; *Solicits proposals from short-listed design professionals and selects the design professional submitting the proposal that is most responsive to the selection criteria; *Confers with the selected design professional to determine the scope of the work; ¢Negotiates the owner-design professional agreement with the selected design professional,based on the mutually developed scope of work. The agreement for professional services between the owner and design pro- fessional defines the roles and responsibilities of each party,the project objec- tives,the scope of services that the design professional is to provide, compensation,project budget and schedule,risk allocation,and other con- tractual matters.It is in the interest of each party to express their under- standings and requirements in the agreement,as it governs the activities of those who sign it,as well as others who will provide the design services. Standard-form professional service agreements often provide a good initial framework for individual agreements.A legal review of the contract terms and language is in the best interest of all parties. In some cases (typically public sector projects),owners may use competitive low bidding or a two-envelope selection system to procure design services. These systems offer less flexibility in addressing design issues as a project evolves and neglect life-cycle cost analysis. DEVELOPING THE PROJECT DESIGN After signing the agreement for professional services,the owner and design professional develop a conceptual design that meets the owner's project goals. Sometimes known as alternative investigation (or pre-design),this phase of the project includes: ¢Amplifying and refining the previously stated project goals; *Developing specific objectives to meet those goals; ¢Formulating and studying conceptual alternatives to meet the objectives; *Selecting the most favorable alternative; *«Completing project conceptualization; ¢Developing preliminary facility layouts,costs,and other design criteria; ¢«Documenting these activities to guide the design effort. The design professional is typically responsible for studies,project planning, reports,and other activities,as specified by the agreement and directed by the owner.Technical specialists may be engaged for particular tasks,such as xvil >Chapter 7,"Agreement for Professional Services” >Chapter 8,"Alternative Studies and Project Impacts” Chapter 9,"Planning and Managing Design” Chapter 10,"Design Discipline Coordination” Chapter 11,"Guidelines for Design " Chapter 12,"Pre-Contract Planning for Construction” Chapter 13,"The Construction Team” geotechnical exploration,noise and air quality analysis,water quality stud- ies,and other activities.The owner is responsible for reviewing and approv- ing the design professional's end product,usually known as a preliminary design report. DESIGN ACTIVITIES In DBB contracting,the design professional,acting under the terms of the contractual agreement with the owner,is usually responsible for producing the completed design for the owner's approval.The services to be provided by the design professional are documented in the plans and specifications, cost estimates,and other construction contract documents used in the selec- tion of the constructor and procurement of construction services.The design professional presents the completed documents to the owner and the owner's legal advisers for review and approval. The design professional follows the preliminary design report approved by the owner for the planning and execution of the design effort,and is prima- rily responsible for design phase activities,which typically include: «Planning and managing the design; ¢Maintaining coordination and communication among design discipline leaders and other team members during design; *Monitoring and controlling design costs and schedule,and developing estimated construction costs and the anticipated construction schedule; *Providing qualified staff; *Performing design-related quality control functions; ¢Arranging for appropriate design reviews,constructability reviews, operability and maintainability reviews,and peer reviews. The design professional is responsible for providing services in a manner that complies with local,state,and federal laws and applicable codes of ethics.In addition,the design professional can make a substantial contribution to proj- ect quality by addressing sustainable development concerns and incorporat- ing features to reduce impacts on natural resources,the environment,and future users. PLANNING FOR CONSTRUCTION The key aspects of pre-construction planning include the assessment of the owner's capabilities,the evaluation of resources available for construction, compliance with regulatory laws and guidelines,the completion of any nec- essary site preparation,and the review of construction alternatives and con- tractual arrangements.These planning activities aid the owner in setting up an effective field organization. SELECTING THE CONSTRUCTOR As the pre-construction and design phases conclude,the central project activ- ity (under DBB)becomes the selection of the constructor.The design pro- fessional may assist the owner in evaluating constructor bids,but the owner is responsible for choosing the constructor.Procedures for selecting the con- xviii structor range from structured public bidding,to priced or best value pro- posals,to selection based on constructor qualification or on favorable past performance and/or relationships with the owner. The most important steps in the selection process are the constructor's pres- entation of qualifications to demonstrate his or her ability to perform under the conditions of the contract and the evaluation of these qualifications by the owner and design professional.Constructor competition based on quali- fication may lead to a negotiated contract with the owner;it may place the constructor on a short list of invited bidders;or it may pre-qualify the con- structor to bid on one or more public projects. One of the key tasks of the design professional during the selection of the constructor is the preparation of the bidding package for the owner's approval. The package contains both the contract documents that define the project and the procedures for submitting competitive bids or proposals.The design professional may also assist the owner in administering the bidding process, evaluating bids or proposals received,and preparing the contracts. THE CONSTRUCTION CONTRACT After the constructor is selected,the construction contract documents become the basis of understanding between the owner and constructor.The contract package usually includes the owner-constructor contract,general and sup- plementary conditions,plans and specifications,addenda issued before bid closing,the constructor's bid,notice of award,performance and payment bonds,insurance certificates,and contract change orders issued as construc- tion proceeds.The constructor is responsible for performing in accordance with the terms of the contract and for constructing the project as described in the documents. MANAGING CONSTRUCTION,SUBMITTALS,AND CONTRACT ADMINISTRATION The constructor takes on a major role as construction begins.The construc- tor's activities include determining the means,methods,and sequencing of construction;managing and paying subcontractors and suppliers;initiating and maintaining quality control for construction activities;and meeting appli- cable codes,permit requirements,and other public agency regulations.The owner takes an active role in promoting site safety by assigning overall proj- ect safety responsibility and authority to a specific organization or individual (often the constructor)that is qualified in construction safety principles,rules and practices appropriate for the particular project (see ASCE Policy Statement 350,"Construction Site Safety”). The constructor ultimately depends on the owner for the review and approval of completed construction.The owner,in turn,may delegate certain con- struction-period administrative responsibilities to the design professional. Though under traditional DBB contracting the design professional has no con- tractual relationship with the constructor,the design professional is often actively involved in construction administration activities under the terms of the owner-design professional agreement.These activities typically include xix >Chapter 14,"Procedures for Selecting the Constructor” >Chapter 15,"The Construction Contract” >Chapter 16,"Planning and Managing Construction” >Chapter 17,"Construction Contract Documentation and Submittals” >Chapter 18,"Construction Contract Administration” >Chapter 19,"Operation and Maintenance” providing technical services,clarifying contract documents,reviewing change orders and submittals,as well as reviewing and approving completed con- struction on behalf of the owner. The constructor is usually required to submit information for review and approval by the owner and the design professional (if so designated by the owner).Known as submittals,this information may include: *Contract compliance documentation;*Mechanical and electrical compo- ¢Schedules;nent shop drawings; *Cash-flow estimates:°Performance data for equipmentassemblies;*Health and safety plan;¢Drawings for temporary¢Structure of lump-sum bid items;.construction; *Structural component shop .¢Vendor and material submittals;drawings; *Equipment shop drawings:*Results of independent testing. The preparation and initial approval of submittals is the responsibility of the constructor,assisted by supporting suppliers,equipment manufacturers,and subcontractors,including detailers and fabricators.The owner,often with the aid of the design professional,is responsible for reviewing and approving the constructor's submittals for the limited purposes stated in the contract docu- ments.The design professional and constructor may assign responsibilities to their respective subconsultants or subcontractors and agree on procedures and communication to facilitate the smooth flow of submittals. In administering the construction contract,the owner is responsible for ful- filling contractual obligations to the constructor and focusing on issues that directly affect project quality,particularly those related to the quality of mate- rials,tradecraft,and safety.The owner may assign selected contract admin- istration responsibilities to the design professional.However,construction contract administration does not extend to actually managing the construc- tion,which is the responsibility of the constructor. OPERATIONS AND MAINTENANCE The successful operation and maintenance (O&M)of a completed project are derived from and closely associated with the level of quality in the design and construction process.Even if design and construction proceed smoothly,over- all quality may suffer if the project is costly or cumbersome to operate and maintain.O&M characteristics affect a project's service reliability,durabil- ity,efficiency,and life-cycle costs,as well as the environment,public health, user safety,and other external aspects of the completed project. XX OTHER ASPECTS OF PROJECT QUALITY In addition to the activities above,this Guide provides information on sev- eral topics that do not fit neatly into a chronological discussion of constructed project activities,yet are crucial to project quality.These are described below. Quality Assurance and Quality Control (QA/QC) Project quality is the result of aggressive and systematic quality assurance and quality control efforts by each participant.QA/QC measures include: ¢The Owner may supply project-specific quality standards to the design professional and constructor or require that each adapt their typical QA/QC procedures to the project. ¢The Design Professional implements a plan addressing staff needs, communication,design procedures,reviews,the use of specialty advi- sors,and other concerns. ¢The Constructor implements a QA/QC plan addressing personnel, materials,communication,scheduling,cost control,reviews,project environment,safety,and other concerns. Computers Computers improve productivity by automating office and design tasks and improving coordination capabilities for the entire team.Powerful desktop and portable computers,networks,E-mail,and the Internet have transformed the way construction industry professionals can work together.Among their many functions,computers aid the owner in managing project activities and oper- ating the completed facility,provide the design professional with computer- aided design and drafting capabilities,and offer the constructor greater flexibility in calculating quantities of materials,scheduling,and overall proj- ect management. Peer Review The peer review is an independent critique of a project conducted by a team of seasoned engineering or construction professionals with the goal of offer- ing a fresh,unbiased look at the functioning of an organization or a clearly specified area of a particular project's design.While peer reviews do not focus exclusively on costs,they often generate savings by identifying ways to reduce schedule requirements and/or improve the quality of project elements. Risk,Liability,and Avoiding Conflict All constructed projects involve risks.These risks may be grouped in four general categories:safety,financial,professional,and legal.Participants ben- efit from identifying potential risks and liabilities,developing a clear and fair xxi >Chapter 20,"Quality Assurance and Quality Control” >Chapter 21,"Computers and Project Quality” >Chapter 22,"Peer Review" >Chapter 23,"Risk,Liability,and Avoiding Conflict” >Chapter 24,"Partnering” >Chapter 25,"Value Engineering” plan to allocate and manage them,and securing insurance (where appropri- ate)before making commitments to other parties.While disagreements are natural in work situations,the selection of mature team members,the align- ment of common interests,and the fair allocation of risk can help minimize the adverse impacts of conflict. Partnering Partnering can enhance project quality by improving relationships among team members.It emphasizes mutually beneficial problem solving,improves risk management,helps reduce claims and cost overruns,increases general job satisfaction,and reduces litigation.Partnering helps develop good working relationships by creating an atmosphere of respect and trust.Partnering is sometimes known as "dispute avoidance.” Value Engineering Value Engineering (VE)is a structured,utilitarian methodology for review- ing and enhancing project design.VE involves a unique and detailed process, known as function analysis,that gauges the value of individual project ele- ments.The goal of the VE process is to identify alternatives that will maxi- mize the relationship of function,performance,and quality to cost. SUMMARY Quality in the constructed project is achieved when the project team works together to fulfill their responsibilities to complete the project objectives in a manner that satisfies the requirements of each participant. The agreement between the owner and design professional,and the contract between the owner and constructor,are the cornerstones of project quality. The process of developing these documents provides a structured forum for participants to express their requirements and align their interests.As a proj- ect proceeds,these documents are a key source of understanding for project objectives and the responsibilities of each team member.The level of project quality is directly related to the clarity with which the team members under- stand and express their requirements. This Guide benefits from the experience and input of hundreds of industry professionals from virtually every area of design and construction.The infor- mation and recommendations presented here are intended to aid readers in developing an approach to their work and practice that meets their individ- ual needs,as well as the objectives of particular projects in which they may be involved.O xxii CHAPTER 1 INTRODUCTION he purpose of this Guide is to provide project owners,design profes- sionals,and constructors with information and recommendations on opportunities to enhance the quality of constructed projects. While written for these three traditional project participants,this Guide is also intended to be useful to others who are involved in project design and con- struction,including subcontractors,vendors,operations and maintenance per- sonnel,inspectors,and project users.Additionally,the information in this Guide may be of value to government officials,educators,students,legal pro- fessionals,and general readers with an interest in design and construction. Given its broad intended readership,this Guide is an "aspirational”document with the goals of educating and stimulating readers to identify areas where they may raise the quality level of their practice.This document is not a tech- nical standard,nor a compilation of standard industry practices. Readers should not infer that simply following the practices discussed herein will automatically result in improved project quality.Many other factors,some beyond the control of the project team,can affect project outcomes.Project participants are therefore encouraged to modify or vary the processes described in this Guide to achieve the desired quality results for specific projects. 1.1 THE MEMBERS OF THE PROJECT TEAM Under traditional design-bid-build (DBB)project delivery,the project team consists of three principal participants:the owner,design professional,and constructor.Under alternate forms of contracting,the team may include a design-build contractor (performing the roles of both the design professional and constructor),a construction manager,a consulting design professional,a private developer,and/or other participants.While this Guide is written pri- marily from the DBB perspective,the authors and reviewers have addressed considerations related to other forms of project delivery,such as design-build or owner-provided,where appropriate. The choice of the word "team”to describe the project participants highlights the desirability of cooperative relationships.Individually and collectively,par- ticipants control quality and benefit from its being achieved. In this chapter 1.1 The Members of the Project Team 1.2 Team Member Requirements 1.3 Team Member Responsibilities 1.4 Defining Key Terms 1.5 Balancing Team Member Requirements 1.6 The Obligations of Team Members 1.7 Principal Themes of This Guide Quality in the Constructed Project is an "aspirational”guide. Owner:The individual or entity that initiates a construction project and is responsible for financing it. Design Professional:A person or entity qualified and licensed to perform engineering or architec- tural services,including: ©Developing project requirements; ©Creating and developing project design documents; ©Preparing drawings,specifica- tions,and bidding documents; Delivering design services during construction and start-up. Constructor:The individual or entity responsible for performing and completing the construction of a project as specified by the con- tract documents. This Guide is written primarily from the DBB perspective;however, considerations related to alternate forms of project delivery,such as design- build,are discussed where appropriate. Contractual agreements define and control each participant's role,responsi- bilities,and limits of authority.In DBB contracting,these are the owner-design professional agreement and the owner-constructor contract. Under DBB contracting,the owner is the originator and provider of funds for the project,and is therefore responsible for selecting the other team mem- bers and leading the effort.The owner selects qualified team members- usually through qualifications-based selection (QBS)for the design professional and competitive bid contracting for the constructor-and guides them through the negotiation and administration of agreements and contracts. Under alternate forms of project delivery,the owner may contract with a sin- gle entity for project services.In addition,the owner may share a larger por- tion of the project's financial responsibilities,risks,and rewards with a design-build contractor or a third-party developer. 1.2 TEAM MEMBER REQUIREMENTS Each team member brings a unique set of requirements or expectations that he or she wishes to have met in the course of completing the project.These requirements are what a participant may reasonably expect of fellow partic- ipants.These are distinct from responsibilities (see 1.3 below). £8345;5%%Typical Requirements of Project Team Members 22.3:d¢4% Owner Design Professional Constructor appearance of the new facility. Project completion on time and within budget. Desirable balance of life-cycle and initial capital costs. Operability and main- tainability. Addressing of environmental,health, permitting,safety,user impacts,and sustain- able development considerations. A fair and reasonable process for resolving disputes. scope definition. An adequate budget. A reasonable schedule. Timely decisions from the owner. Realistic and fair shar- ing of project risks. Adequate communication with the owner regarding performance. A fair and reasonable process for resolving disputes. Timely payment and a reasonable profit. ¢Adequate function and «An adequate project ¢A well-defined set of contract documents. A reasonable schedule. Timely decisions from the owner and design professional. Realistic and fair shar- ing of project risks, Adequate communication with the owner regarding performance. A fair and reasonable process for resolving disputes. Timely payment and a reasonable profit. In addition to the three principal team members,regulatory agencies often participate in a project,bringing their own requirements related to public health and safety,environmental considerations,utility service,as well as compliance with applicable laws,regulations,codes,standards,and policies. 1.3 TEAM MEMBER RESPONSIBILITIES In this Guide,responsibilities refer to the tasks that each participant is expected to perform.These are summarized as follows: 1g8&49B45,Typical Responsibilities of Project Team Members 154 %2avied Owner ¢Fulfillment of contrac- tual obligations to other team members, including furnishing site and related infor- mation,and timely payment. *Compliance with applicable laws,regu- lations,codes,stan- dards,and practices. ¢Provision of adequate funding. ¢Provision of necessary real estate or right(s) of way. *Provision of project goals and objectives. ¢Fulfillment of insur- ance and legal requirements. ¢Assignment of site safety responsibility. ¢Acceptance of com- pleted facility. Design Professional Fulfillment of contrac- tual obligations to other team members. Compliance with applicable laws, regulations,codes, standards,and practices. Fulfillment of profes- sional standards. Development and drafting of well- defined contract documents. Responsiveness to project schedule, budget,and program. Provision of construction-phase design services. Constructor Fulfillment of contrac- tual obligations to other team members. Compliance with applicable laws,regu- lations,codes,stan- dards,and practices. Interpretation of plans and specifications. Construction of facil- ity as described in contract documents. Management of con- struction site activities and safety program. Management,quality control,and payment of subcontractors and vendors. In the interest of clearly defining the responsibilities of each team member with respect to the activities discussed in this Guide,each chapter concludes with a matrix summarizing the typical responsibilities described in the chap- ter and the relationship (primary,assist/advise,review,or none)of each team member to those activities.In addition to columns for the three principal par- ticipants under traditional design-bid-build contracting,each matrix includes a column for the design-builder.These matrices are provided for purposes of general information only;contract documents and laws control the activities of participants on specific projects.Therefore,the reader is cautioned not to place undue reliance on the responsibilities allocated in these matrices. A sample responsibility matrix follows: Chapter 1:Introduction Typical Responsibilities Responsibility Design Design- Owner Professional Constructor Builder Initiate project,define e ©'O) goals and objectives Select design professional e Produce design @ tT )O @ Select constructor e @ Carry out construction ©©e @ Accept facility rd oO @ © Operate facility @ @ @ @ @ =Primary Responsibility @ =Assist or Advise ©=Review 1.4 DEFINING KEY TERMS In this Guide,quality is defined as the performance of project responsibili- ties in a manner that fulfills the requirements or expectations of each team member.The relationship between responsibilities and requirements is cen- tral to this definition,as they are directly related to the fulfillment of broad project goals and specific objectives. Therefore,in this Guide the folowing definitions apply: Goals:Broad aims of the project,usually conceptual,as expressed by the owner. Objectives:Specific descriptions of project location,function,size, performance characteristics,schedule needs,financial mat- ters,and other items that are developed by the owner,often with the assistance of the design professional.Together, objectives are often known as a project program. Responsibilities:The project objectives to be accomplished by each proj- ect participant as defined and assigned by contract docu- ments,applicable laws,licensing requirements,and professional codes of ethics. Requirements:The needs expressed by a project participant;what he or she expects to achieve or receive during and/or upon com- pletion of the project. Role:The scope of a project participant's activities as defined by his or her responsibilities. The team's success in achieving project quality depends on: How well defined and clearly the project goals are expressed. How well the goals are translated into specific objectives. How clearly the objectives are defined and allocated as responsibilities.Fwd>How fairly and reasonably responsibilities are allocated among team members. 5.How well the team members articulate their requirements to each other. 6.How well the team members fulfill their roles and responsibilities to meet contractual and professional obligations. The team achieves quality in a constructed project when the project processes and completed facility meet the requirements of the participants and when the project participants fulfill their responsibilities to each other.The definition of project quality in this Guide does not focus exclusively on criteria such as durability,cost,number of users,or other strictly quantitative measures. For example,an inexpensive temporary pump station-though it may have sheet metal housing,high operating costs,a short life expectancy,and aes- thetic deficiencies-may be considered a quality project if the owner's requirements call for an inexpensive temporary facility.Similarly,a large "'sig- nature”project,though impressive,may not embody quality if its construc- tion involves significant cost or schedule overruns,litigation,adverse environmental impacts,or detrimental effects on public health and safety. Figure 1-1 Project Participant Relationships Owner Project Goals Objectives a Roles and RET Roles and Responsibilities Responsibilities Requirements (needs) we ee ee ee ee ee eee Design Professional <<Roles and Responsibilities0 --Reflected in contractual agreements ---=Implied by requirements or need of others Quality is determined by the degree to which the project participants fulfill their responsibilities to each other. Teamwork is an essential aspect of project quality. As a corollary,this definition of quality places a high value on teamwork as a means to achieve quality in design and construction.If the owner,design professional,and constructor are to be truly motivated to produce a quality constructed project,benefits must accrue to all three.A team approach improves communication,which increases the opportunities for participants to express their requirements,and for them to better understand those of fel- low team members.Therefore,teamwork is an essential aspect of project quality. 1.5 BALANCING TEAM MEMBER REQUIREMENTS While project participants may share the goal of completing the project suc- cessfully,each comes to the project with different requirements.A quality project involves balancing of these requirements to respect and provide for: ¢The owner's cost and schedule needs,desired operating characteris- tics,construction materials,and project specifications. ¢The design professional's need for a schedule,scope,and budget that allow the development of concepts and plans that meet the owner's requirements while earning a reasonable profit. *The constructor's need to build the facility using feasible means and methods of construction within a reasonable schedule,maintain a safe work site,and earn a reasonable profit. These differing needs,while inherent in the nature of the respective partici- pant organizations,can affect the balance necessary to meet the requirements of each team member.Owners often weigh their project goals and objectives against economic considerations and the possibility of failure.The design pro- fessional strives to fulfill his or her responsibilities to the owner and con- structor,but is also obligated to meet applicable codes and regulations.The constructor is bound to execute construction safely and according to the con- tract documents while working efficiently and making good use of construc- tion resources. Early planning allows the project team to address the needs of each partici- pant.Figure 1-2 illustrates the degree to which project characteristics may be influenced by design during successive phases of development.As shown,the impacts of revising the project early in the planning and design phases tend to be less than making changes after the design has been finalized or con- struction has begun.Major changes during the later phases of a project may jeopardize the ability of participants to fully realize their requirements. Therefore,a common understanding of each participant's requirements aids in defining project objectives and allocating each member's related responsibilities. 1.6 THE OBLIGATIONS OF TEAM MEMBERS Team member obligations begin with the obvious:they must work together to complete the project and are therefore obligated to cooperate for the dura- tion of the effort.They are also obligated to complete their work and produce the specified facility in a manner that complies with the contractual agree- Figure 1-2 Design Influence on Project Characteristics LevelofinfluenceDecreasing Influence Design Period Construction Period Operation Period *|llustration only ments,professional and industry practices and standards,applicable codes, laws,and regulations. However,beyond these immediately evident obligations is a deeper set of pro- fessional values upon which team member relationships are founded.A team spirit,based on ethical principles and integrity,and mutual respect of each other's requirements,fosters quality in project activities at every level. Professional behavior is essential in creating the atmosphere of mutual trust and respect,accommodation,and understanding that promotes quality. The owner,design professional,and constructor have an additional obliga- tion to undertake only work that they are qualified to perform and to honor the established contracting processes. 1.7 PRINCIPAL THEMES OF THIS GUIDE Project quality is related to many factors.This Guide focuses on subjects that, in the experience of the authors and reviewers,are central to achieving qual- ity in the constructed project.These are listed below,along with the chap- ter(s)in which they are principally discussed. TRA yorets Subject BC FRU hi aad Pee ae Chapter(s) Clearly defined and assigned roles and responsibilities 1,2,13 The selection of an appropriate form of project delivery 3 A common understanding of each team member's requirements 4 Effective,timely,honest and open communication 5 Appropriate owner processes for selecting team members 6,14 Contract documents that clearly define the responsibilities 7,15 of team members The use of standard form agreements and other contract 7,15 documents Systematic study of project alternatives and impacts 8 Adequate scope definition,schedule,risk management and 9,10,23 liability protection (continues) Aone Subject Sameer Chapter(s) Appropriate procedures for managing design and construction 11,16 Participation of the design professional during construction 12,19 and start-up Well-managed construction contract administration and the 17,18 timely flow of documentation and submittals (including shop drawings) Consideration of operation and maintenance issues throughout 19 project development Appropriate quality assurance and quality control (QA/QC)20 procedures Effective and appropriate use of computers 21 Peer review(s)22 Conflict avoidance and alternative dispute resolution,23 including dispute review boards and mediation Strategies to enhance teamwork,such as partnering 24 Value engineering 25 SUMMARY Achieving quality in the constructed project depends on the members of the project team taking a proactive approach to project activities.Project quality is defined as the delivery of services and products in a manner that meets the expressed and reasonable requirements of the participants;therefore,the level of quality achieved is directly related to the clarity with which the partici- pants express,understand,and respect those requirements.O CHAPTER 2 THE OWNER'S ROLE AND REQUIREMENTS successfully constructed project begins with the owner.This chapter describes the general role and responsibilities of the owner,as well as the owner's typical requirements.Under design-bid-build (DBB)contracting, the owner's role typically involves: *Developing complete,attainable,and practical project goals and objectives; ¢Establishing an understanding of those goals and objectives,as well as participant roles and responsibilities,among team members. There are many terms to describe a project and the specific tasks that are necessary to build it.This Guide uses "goals”to refer to the broad aims of a project,and "objectives”for the detailed tasks that participants carry out to achieve project goals. 2.1 THE OWNER'S ROLE The owner holds the primary role in assuring the quality and success of a constructed project.As the initial member of the project team,the owner iden- tifies the need for a project,establishes basic goals,selects the members of the project team,and communicates his or her requirements about how the project is to be executed. Within this broad set of duties,the owner is responsible for defining objec- tives with regard to cost,performance,appearance,and function.To estab- lish these parameters effectively,the owner should be familiar with basic project management concepts and practices,such as preliminary planning, design,life-cycle cost analysis,peer review,alternative studies,value engi- neering,construction,contract administration,and the shop drawing review and approval process.During the early phases of refining broad goals into defined objectives,the owner may wish to retain design and construction pro- fessionals to supplement internal staff. In addition to setting goals,the owner is responsible for securing and man- aging funds and paying team members. Depending on the scope of the project,the nature of the owner's organiza- tion,and the delivery system selected,the owner may delegate specific respon- sibilities to other project team members.Therefore,an owner's role can vary, from being a highly involved and interactive team member,to providing broad "hands-off”project-wide supervision.The right approach depends on the owner,available resources,the project objectives,and contractual responsi- bilities and obligations. 9 In this chapter 2.1 The Owner's Role 2.2 Project Goals 2.3 Achieving Project Goals 2.4 Establishing Project Objectives 2.4.1 Private Owners 2.4.2 Public Owners 2.5 Team Member Requirements 2.6 Timing and Duration of Participation Goals:Broad project aims. Objectives:Specific facilities, structures,processes,or services to achieve the project goals. Responsibilities:The project objectives as defined and assigned to various team members by con- tractual agreement. Requirements:The combined responsibilities accepted by a party and the needs expressed by that party;what a participant expects or "needs”when participating in a project. >Chapter 7,"Agreement for Professional Services” >Chapter 4,"The Project Team” Obstacles are those frightful things you see when you take your eyes off your goal. Henry Ford Given the wide array of roles that a project owner can choose,it is essential that the owner and team members understand each other's roles and respon- sibilities thoroughly.This understanding,which includes each participant's authority and responsibilities,is typically formalized in agreements,which are the primary source for defining project duties and responsibilities.Other sources for describing participant roles include scope definitions,design mem- oranda,project work plans,memoranda of agreement,and letters of understanding. 2.2 PROJECT GOALS The owner's role and responsibilities in achieving project goals are affected by the following factors: ¢The fundamental need for the project; ¢Past experience in,or responsibility for,completing projects; ¢Observation of other owners'activities on similar projects; *Support from consulting design professionals and construction advisers; ¢Legal advice. 2.3 ACHIEVING PROJECT GOALS Project owners typically express their basic project goals with a focus on three key criteria:quality,timeliness,and budget.The owner's general strategies for achieving these goals include: *Defining general quality objectives in terms that are easily understood and meaningful to the project participants; «Communicating the significance of these objectives to team members, and requesting acknowledgment that they are understood and agreed upon; *Developing realistic schedules and budgets that are accepted by the other team members; ¢Monitoring project participants to enforce the fulfillment of their roles and responsibilities; ¢Maintaining a consistent project scope-and not changing conditions or requirements without allowances for impacts on the schedule and budget of all team members. 2.4 ESTABLISHING PROJECT OBJECTIVES The specific objectives for each particular project will be far more detailed and comprehensive than the goals listed above.Effective objectives refer to specific aspects of a project,such as function,operation,maintainability, schedule,life-cycle costs,technical specifications,safety,aesthetics,finances, administration and management,and regulatory requirements.It is also impor- tant that project objectives include a method for measuring results. Beyond the broader project goals,owners have specific project objectives that must be achieved,and sometimes these objectives are not fully expressed. However,an owner's failure to adequately define and clearly communicate 10 his or her project objectives can create a gap in understanding of the objec- tives by other team members.Ultimately this could increase the risk that team members would not achieve their requirements. Closing this "understanding gap”begins with a thorough examination of objectives.This examination should be undertaken by the owner,other proj- ect members,and,if necessary,qualified technical consultants.The purpose of this examination is to eliminate or revise unattainable and impractical items from the project scope and provide a realistic evaluation of costly or time- consuming items.In some cases,it may be necessary to revise the objectives in order to achieve the original goals of a project. The owner plays the central role in establishing the objectives.The ability to achieve these objectives is enhanced when the owner communicates as clearly and comprehensively as possible with the other team members.The owner accomplishes this by developing open and trusting relationships to promote the candid exploration,identification,and realistic evaluation of the owner's expectations.This process begins with brainstorming and culminates with the translation of project goals into written project objectives.These written objec- tives lead to the development of budgets,schedules,contracts,specifications and definitions of scope,all of which form the roadmap for identifying and allocating responsibilities to the project team members. 2.4.1 Private Owners An owner's organizational structure and culture have a direct bearing on the formulation of project objectives,as well as on the owner's role. Private owners may be able to expedite projects more quickly than public owners.However,private owners carrying out projects in highly regulated industries,such as electric power production,gas utilities,telecommunica- tion,and aviation,may face rigorous constraints,processes,and procedures that affect project progress. All owners have an economic interest in completing projects quickly. However,compared to public owners,private owners are often more influ- enced by,and subject to,economic factors,such as short-and long-term financing,the amount of capital investment,return on investment,profitabil- ity,cash flow,and economic risk.Other project aspects that may have greater influence on private project owners include demand,marketability,aesthet- ics,and general fiscal performance.The success of a private project tends to be measured with a strong emphasis on the value to customers and investors. New laws and agency regulations,especially those dealing with energy,trans- portation,health,safety and the environment,can also affect established proj- ect objectives for private projects. 11 The failure to adequately spell out project goals can create a gap in understanding. Public owners are usually subject to a greater degree of scrutiny than private owners. >Chapter 5,"Coordination and Communication” 2.4.2 Public Owners Public project owners include cities,towns,counties,school boards,special districts such as utility districts,and local,state,and federal agencies.Like private owners,public owners must follow relevant project development processes and procedures as outlined in local laws,ordinances and regula- tions,and applicable state and federal laws and regulations.Public owners are usually subject to a greater degree of public scrutiny and oversight than private owners.For example,public review and comment can require further studies on high profile projects. Public projects must often conform to pre-established funding limits,and the project objectives tend to be oriented toward performance and compliance. The success of a public project frequently depends on a greater number of factors than a private project.These factors may include the benefits to the wider public (not just those with a direct stake in the success of the enter- prise),utility to the community,potential increases in accessibility,and pro- tection of the environment. Finally,project objectives for public projects may be influenced by political change,especially if planning and funding involve lengthy processes.Over time,the owner's representatives,budgets,programs,and even prospective users may change,creating direct impacts on project objectives.New laws and agency regulations,especially those dealing with energy,transportation, health,safety and the environment,can also affect established project objec- tives for public projects. 2.5 TEAM MEMBER REQUIREMENTS AS project objectives are being defined by its specific objectives,each team metnber brings individual requirements,interests,and values to the effort. Naturally,the interests of some team members will conflict-especially when large numbers of participants are involved.In these situations,the owner ben- efits from establishing clear lines of communication and an unambiguous sys- tem for identifying and resolving differences in a prompt,mutually satisfactory manner. Therefore,communication among project team members should begin as early as possible.Team members will have a better opportunity to develop an accu- rate understanding of the project goals and objectives,and a heightened com- mitment to achieving them,if they assist in the development process.Early communication also allows team members to gain an awareness of each oth- ers'requirements and expectations,allowing them to be better prepared to deal with potential conflict. 2.6 TIMING AND DURATION OF PARTICIPATION The involvement of different team members during appropriate periods of the project is critical for achieving the project objectives and the owner's require- ments.In general,the earlier team members become involved and the greater the continuity of their participation,the greater the benefit to the owner.The growing popularity of alternative project delivery systems reflects the owner's 12 quest for new ways to benefit from a consistent,cohesive project team from the outset to the completion of the project. One strategy for achieving greater continuity is for the owner to engage a design professional as an advisor early in the conceptual development phase. After completing traditional preliminary and final design services,the design professional may also play a role in the construction phase,quality assurance, and start-up. In the case of the constructor,similar continuity is desirable.While private owners are free to bring constructors onto the project team at any point,pub- lic owners may be constrained by local,state,and federal requirements that limit constructor participation in the early phases of a project.In such cases, the owner may engage a construction adviser with relevant experience to review the feasibility of construction,which is generally known as a con- structability review. The owner can enhance the caliber of team member participation by being an exemplary communicator.Communication at every level,every phase,and in many relationships,is a key to the fulfillment of the project objectives and the meeting of participant requirements.This is particularly true in over- coming the loss of continuity when key personnel depart.To improve com- munication,the owner should make available pertinent information to internal managers and the managers of other team members through regular update meetings,disseminate appropriate documents,and visit the project site.The owner may also reduce the risk of unforeseen site conditions,and associated disputes,claims and disruptions,by sponsoring an adequate investigation of site conditions and sharing this information with appropriate team members. Such extra efforts usually save more than they cost. SUMMARY The project owner is the primary force behind the translation of concepts, ideas,and goals into the objectives that lead to quality in the completed facility. For a project to fulfill the owner's requirements,the owner must create the conditions under which the project team can work together effectively and develop a common understanding of project objectives and the specific roles and responsibilities of each team member.During the early stages of a proj- ect,the owner is at the center of shaping the relationships among team mem- bers that allow the broad project goals to be fleshed out as project objectives. As the initial force behind a project,the owner benefits from good commu- nication and agreement among team members on how the project objectives will be developed and implemented.Owners are more likely to have their requirements understood and met when those requirements are reflected in project objectives that are clearly specified in written agreements,contracts, specifications,and drawings.O 13 In general,the earlier a team member becomes involved,the greater the benefit. Chapter 2:Owner's Role and Requirements Typical Responsibilities Responsibility Design Design-QO Owner Professional Constructor Builder Establish project goals e ®@ © Develop project objectives eo @ Communicate project objectives e@ ©@ © to team members Develop financing @ Implement project e ©e@ e @ =Primary Responsibility @ =Assist or Advise ©=Review 14 CHAPTER 3 PROJECT DELIVERY SYSTEMS wners,design professionals,and constructors make the decisions,In this chapter provide the services,and perform the work to deliver constructed proj-3.1 Owner-Provided Delivery ects.These activities are known collectively as project delivery,and the 3.2.Traditional Design-Bid-Build generic term "project delivery system”describes how the participants are .:.'._3.3 Construction Managementorganizedtointeract,transforming the owner's project goals and objectives 3.3.1 Agency Constructionintoafinishedfacility.Manager (ACM) 3.3.2 Construction Manager- When deciding how project resources are to be organized,the owner consid-at-Risk (CM-at-Risk} ers a number of general but significant factors,including:3.4 Design-Build 3.5 Design-Build Variations¢Past practices,traditions,and experience;..practices,traditio Xperl 3.5.1 Funding Option¢The advice of consultants;Variations ¢Funding sources and constraints;3.5.2 Turnkey *The effective use of staff and working capital;3.5.2(a)Design-Build- Operate-Transfer 3.5.2(b}Design-Build- Operate-Maintain 3.5.2(c)Design-Build-Own- ¢The interests of other project stakeholders. The most common method of project delivery for public projects,and for many private projects as well,is known as design-bid-build (DBB).This Operate-TransferGuidereferstoDBB,unless stated otherwise.However,there are other proj-3.5.3 Developer-Financed ect delivery systems that are often effective in meeting an owner's needs.This Projects chapter summarizes traditional DBB contracting and introduces several other 3.5.4 Turnkey Variations types of project delivery systems that are becoming more prominent in the 3.6 Fast-Tracking:A Distinction United States. The owner enjoys total control of the project until other parties are invitedto participate.The questions of who to ask for help,when to engage that help, and the specific assignment of tasks to other parties depend heavily on the owner's desire to retain control or to delegate responsibilities.Project con- trol can also be influenced by the project type and applicable laws. Consider four hypothetical project owners.The first may have clearly defined project goals and objectives and may prefer to closely guide team members through each step.The second,also with well-defined goals and objectives, may instead choose to delegate many management responsibilities to other team members.The third owner,unfamiliar with contracting processes,may be well served by managing the project closely so that he or she may under- stand and approve each step of planning and construction.The fourth owner, like the third,may be unfamiliar with engineering and construction processes but may,like the second,may prefer to delegate responsibilities to parties more experienced in construction. 15 Project financing has become one of the more significant factors in selecting an appropriate project delivery system. The terms and definitions used in this chapter are continuously changing. These four owners illustrate that retaining and delegating project control and responsibilities are largely matters of owner preferences.Therefore,the owner's choice of a project delivery system to match his or her requirements is a critical step in achieving project quality. In general,risk and reward are structured to be in proportion to the amount of control retained or delegated.However,the owner cannot delegate some project responsibilities,such as providing the project site (or the criteria for selecting the site),determining the general approach to financing,and set- ting the goals for the new facility. The owner's decision on how to proceed with design and construction may be rooted in tradition.However,tradition also usually dictates a reliance on the advice of staff and other knowledgeable sources,such as design profes- sionals,construction experts,and legal counsel,to select a project delivery system that defines appropriate roles for the primary project participants. Financing can be a significant factor in selecting an appropriate project deliv- ery system.If grants or loans are available,the financing agency might spec- ify a method of delivery and control,even designating key players,as a condition of putting its funds at risk.The need to expend or commit funds in accordance with a fixed budget or budget cycle might sway an owner toward some variation of design-build,if the law permits such.If the owner is will- ing to delegate even more responsibilities to a public or private developer who would finance,design,build,and perhaps operate the facility,one of the turnkey methods of delivery might be preferable. The marketplace is continuously transforming and redefining many of the project delivery alternatives discussed in this chapter.Therefore,it is impor- tant that parties entering discussions about project delivery be clear about their terms,as the definitions used in this chapter do not enjoy universal acceptance. 3.1 OWNER-PROVIDED DELIVERY On projects where the scope of work is within their range of skills,experi- ence,and resources,owners often choose to perform some or all of the design services and construction work themselves.Projects that involve simple mod- ifications to an existing facility,as well as projects that are limited in cost or complexity,are good candidates for owner-provided delivery.An owner might also elect to keep repetitive projects in-house. The owner may supplement internal professional staff with design special- ists such that the design services are essentially self-provided.Construction may also be accomplished using the owner's resources entirely,or with the owner serving as the general contractor and subcontractors performing much of the work.Of course,the owner must meet professional registration and contracting licensure requirements.Many larger private and public entities provide some of their design professional services in-house and may per- form some construction using their own resources. 16 3.2 TRADITIONAL DESIGN-BID-BUILD In the U.S.,DBB contracting has for many years been the form of project delivery required by law for the owners of most public works projects.Owners of many private projects also frequently choose DBB contracting.DBB is effective on projects where the owner needs both professional design serv- ices and construction services.DBB is also effective in cases where the design professional does not require detailed knowledge of the means and methods of construction.DBB provides the owner with a high degree of control and is therefore often the preferred project delivery system for owners who: *Wish to closely monitor projects (even conventional ones); ¢Are public owners and must account in detail for expenditures; ¢Are obligated by statute to procure professional design services by qualifications-based selection (QBS)regulations and constructors by competitive bidding. Apart from such needs,the owner of a complex project may simply view the sequential nature of development under DBB as a benefit to quality. Under DBB delivery,the owner defines project goals and objectives,secures the financing,and specifies the standards and contract terms.The owner may perform planning,conceptual design,and full design,or may engage an out- side design professional for some or all of these tasks.During this planning and preliminary design stage of a project,the owner and design professional generally work as a team to obtain required permits and conduct the neces- sary site investigations. The design professional then prepares the construction bid documents to reflect the owner's project goals and objectives,the project's site conditions, and sound engineering practices.The bid documents should be sufficiently complete,detailed,and clear in describing the project objectives,and may even include a quantity take-off schedule for quoting unit prices to assist in obtaining comparable and responsive bids. Prospective constructors prepare their bids from the complete and specific bid documents.Each bidder typically evaluates risk and uncertainty to identify potential conditions that could affect cost or schedule. The bidders submit their proposals to the owner,who,often with the assis- tance of the design professional,determines the most responsive bid- typically the lowest bid meeting the project objectives.Alternatively,private owners,and public owners if permitted by statute,may establish criteria to select the constructor according to a value-based selection system in which cost is one of several factors considered. In certain circumstances,an owner may be justified in selecting a construc- tor outright and negotiating contract terms directly.The contract price may oo 66belumpsum(perhaps with shared savings),"cost-plus,”"cost-plus with a maximum,”or may be based on unit prices applied to presumed quantities. 17 Design-bid-build provides the owner with a high degree of control over the project. >Chapter 14,"Procedures for Selecting the Constructor” >Chapter 23,"Risk,Liability,and Avoiding Conflict” > wy) 18.1,"Resident Project Representative (RPR)” Construction Management Association of America: www.cmaanet.org During construction,a member of the owner's staff,or the construction manager or a member of the design professional's organization if designated by the owner,usually serves as the owner's resident project representative (RPR).This person administers the construction contract,with responsibili- ties that include reviewing the constructor's submittals and work for confor- mance with the requirements of the contract documents and evaluating the constructor's payment applications for work completed. 3.3 CONSTRUCTION MANAGEMENT Many owners engage construction managers to assist in developing bid doc- uments and overseeing project construction.In the broadest sense,a con- struction manager (CM)is a professional or firm trained in the management of construction processes;CMs tend to be less involved with the detailed implementation of those processes.Organizationally,a CM is generally inter- posed between the owner and some or all of the other participants.There are two general types of construction managers:agency construction managers (ACM),and construction managers-at-risk (CM-at-risk).However,CM roles and responsibilities often vary.Therefore,participants benefit from defining construction management for the project at hand. Some advocates of construction management say the CM should first act purely in the ACM relationship,with the owner engaging the design profes- sional.When the project is well defined (or even designed completely),the CM then shifts to the CM-at-risk role.Others argue that an ACM should only remain as the owner's adviser during construction.Ultimately,the decisions regarding these roles depend on the owner's desires and requirements for del- egating responsibility and authority.The owner may add and define new roles for the CM as the project unfolds,such as assisting in the determination of the independence of design and construction functions,the effective coordi- nation of those functions,and/or options for combining roles. 3.3.1 Agency Construction Manager (ACM) A construction manager acting as an agent of the owner extends the owner's internal capabilities in performing traditional owner responsibilities.However, an ACM functions wholly within the policies,procedures,and practices of the owner's organization.The level of service by the ACM can range from on-call advice to full project management.For an owner undertaking few proj- ects,the ACM might become,in effect,the entire technical staff. In some cases,the owner hires the ACM before design begins.The ACM may participate in the selection of and contracting with the design professional or might even be the design professional.Before the development of the con- struction contract,the owner and ACM agree on the scope of the ACM's serv- ices during construction.The scope and scale of these services varies with the ACM's effort and authority.An ACM may function within any of the project delivery systems described in this chapter,with the owner transferring some control and risk to the ACM. 18 3.3.2 Construction Manager-at-Risk (CM-at-Risk) Project delivery under the construction manager-at-risk arrangement increases significantly the owner's delegation of control and risk.A CM-at-risk typi- cally contracts with the owner in two stages.The first stage encompasses serv- ices during the conceptual and preliminary design phases,during which the CM-at-risk and the design professional,perhaps acting as the CM-at-risk's subconsultant,manage and undertake those functions,with variable partici- pation by the owner.During this stage,the CM-at-risk is usually a paid con- sultant.When the design is complete,the owner and CM-at-risk then agree on a price and schedule for the construction work. The second stage involves the completion of construction for a negotiated fixed or guaranteed maximum price.At this point,the CM-at-risk and the owner agree on the contractual terms that will apply to the project.Acting as a general contractor,the CM-at-risk then engages the design,specialty,and trade subconsultants and subcontractors necessary to complete construction. Construction management-at-risk is popular for owners of private projects, and some states now allow CM-at-risk on some public works projects. 3.4 DESIGN-BUILD Design-build project delivery,in which one entity is responsible for both design and construction,has been used by owners of public and private proj- ects throughout history.A 1997 study by the Construction Industry Institute of more than 350 construction projects in the U.S.found that many project participants find design-build contracting effective for achieving schedule and cost savings on projects with certain parameters.Significantly,design-build is the predominant form of project delivery outside the U.S. Under design-build delivery,the owner contracts with a single entity to provide the design (or at least a final,detailed design)and to construct the project according to that design.Under design-build,the owner first assesses his or her own in-house capabilities.The contract might be negotiated with a single design-builder or result from competitive proposals.The selection of the design-builder can be based on low price only or on a set of value cri- teria where factors such as similar project experience,key staff availability and experience,bonding capacity,and other factors,are considered along with price. Design-build provides the owner with a single point of contact for project responsibilities,eliminating the need to assist in resolving designer-con- structor disputes.With the constructor playing a major role in design,costs are typically defined and maintained to a greater degree,and the coordina- tion of fast-track management to achieve early completion is greatly simplified. The design-builder makes many decisions that the owner would make under DBB.The owner delegates to the design-builder greatly increased authority to 19 Project Delivery Systems: CM at Risk (Doc.4160), Design-Build Institute of America. Several states have begun to allow construction management-at-risk. ty Construction IndustryInstitute: WWW.CII.Org Project Delivery System Workbook,Construction Industry Institute,1999. hy Design-Build InstituteofAmerica: www.dbia.org >12.1,"Assessing the Owner's Capabilities” >10.2.3,"The Design-Build Project” >3.6,"Fast-Tracking:A Distinction” Handbook on Project Delivery,American Institute of Architects California Council,1996. >6.2,"Qualifications-Based Selection (QBS)” Under design-build,the design professional is engaged by the design- builder-not the owner. >17.3.3,"Shop Drawings for Manufactured Structural Components” fulfill an increased number of responsibilities.For many owners,design-build delivery leads to very satisfactory projects.However,if the parties are not experienced with design-build and do not cooperate,the transfer of control and risk can be disappointing.The potential benefits and the degree to which they are realized is related to the owner's ability and willingness to structure his or her internal procedures to accommodate the design-build approach. Compared to DBB contracting,this involves a significantly different set of requirements and expectations for processes,timeliness,and communication. A clear understanding and documentation of design-build processes enhances the quality of design-build projects.The owner,usually with in-house design staff and/or an independent design professional,typically prepares descrip- tive conceptual documents and develops a preliminary design.This level of detail aids the owner in communicating the project goals and objectives to design-build proposers,helping to reduce uncertainty,contingency allowances,and the potential for disputes. The owner typically prequalifies a short list of design-builders who demon- strate the necessary experience,reputation,financial resources,and other qual- ifications to complete the design-build effort.The owner's request for a proposal is issued only to the short-listed firms.The owner sometimes pro- vides a stipend to competing firms as partial compensation for the cost of preparing their proposals,a practice that is intended to improve the quality of the proposals offered. For value-based selection of the design-builder,the owner evaluates propos- als using a predetermined matrix of factors and awards the project to the design-builder with the best overall score.Therefore,the bid price,while usu- ally heavily weighted,is but one of several factors considered in making an award.Federal guidelines for this two-step procurement method attest to the value of prequalification and value-based selection,but applicable statutes vary in each state. In some instances,design-build delivery involves an adjustment on the part of participants to this contracting role.One of the most significant departures from DBB delivery is that the design professional completing final design is usually engaged by the design-builder,not the owner. Another significant departure from traditional DBB delivery is that the focus of the design professional's effort is on meeting the project objectives as planned by the constructor.Therefore,issues that affect design,such as con- structability,the use of particular equipment or erection methods,the choice of construction materials,and schedules,are directed by the constructor.The design professional is responsible for meeting the owner's stated objectives, as well as applicable codes and standards,but the design professional's client is the design-builder,not the owner.It is important to note,however,that the design professional's responsibility for specifying performance specifications for manufactured structural items and reviewing shop drawings for confor- mance with the design is the same,whether or not the design professional is engaged as part of the design-build team or as an independent consultant. 20 In other instances,the design professional may hire contractors and subcon- tractors to perform the construction;or the constructor may have sufficient in-house professional staff to perform the design function. 3.5 DESIGN-BUILD VARIATIONS A variety of contractual arrangements exist for providing additional project functions (other than design and construction),such as financing,leasing,and operating the completed facility.The following sections briefly discuss these arrangements. 3.5.1 Funding Option Variations Private capital and developer participation offer private owners several vari- ations on design-build project delivery.A typical arrangement is sometimes called lease-develop-operate,under which the owner gives a private operator a long-term lease to use,operate,and expand an existing facility.This oper- ator finds external funding for the owner to borrow to pay for the improve- ments,and the owner dedicates part of the lease payments to amortizing its resulting debt.The operator engages a conceptual design consultant to pre- pare conceptual and preliminary designs for the improvements that meet the project objectives and then hires a design-builder to complete the project. Other variations may be called a "public-private partnership”or a "wrap- around.”In such an arrangement,ownership of or fiduciary responsibility for a project is assigned to a private party.That party then designs,builds,and may even own,operate,and maintain the new facility,eventually transfer- ring it back to the owner. 3.5.2 Turnkey Turnkey project delivery has the characteristics of design-build,but adds to the design-builder's responsibilities the operation and/or maintenance of the completed project.Turnkey delivery further reduces oversight demands on the owner,so the contractor "turns over the keys”when the project is com- plete.Turnkey delivery,through this transfer of responsibility and risk,has the potential for bringing a new project on line more quickly. Three forms of turnkey project delivery are described below.The terminol- ogy is often subject to interpretation,so all parties should clarify definitions. 3.5.2(a)Design-Build-Operate-Transfer Projects in which the period that the contractor operates the completed facil- ity is limited are known as design-build-operate-transfer,or DBOT,projects. The turnkey design-build contractor typically operates and maintains the facil- ity for approximately one year or to the end of the first warranty period. 3.5.2(b)Design-Build-Operate-Maintain Design-build-operate-maintain,or DBOM,project delivery,also called "super turnkey,”is most often used on projects where the period of contractor oper- ation and maintenance is about 10 to 15 years.The performance goals for 21 Turnkey delivery allows the design-build constructor to simply "turn over the keys”to the completed project to the owner. DBOM projects typically provide incentives to the DBOM contractor to min- imize maintenance costs. 3.5.2(c)Design-Build-Own-Operate-Transfer The design-build-own-operate-transfer,or DBOOT,method of project deliv- ery is a broader type of turnkey,typically used for a toll road,bridge,or other elements of revenue-generating public infrastructure.The owner might rely on tax exempt revenue bonds for initial financing.The DBOOT entity is then responsible for and acts as the owner of the facility for a specified period, using operating revenue to meet the bond amortization schedule.Thus,the length of time that the DBOOT entity operates and maintains the project is often considerably longer and may require repairs and component replacements. DBOOT delivery can also be carried out using private financing secured through a developer.Like public bonds,the private capital,plus interest,is repaid from the operating revenues of the facility.Since the term and scope of the contractor's operating and maintenance role extends over a signifi- cant portion of the project's design life,the DBOOT entity might form a sep- arate business unit that operates the completed facility until it is turned over to the owner. 3.5.3 Developer-Financed Projects For highly specialized projects and circumstances,financing from a private or public developer or other third parties can offer additional variations on design-build and turnkey project delivery,each with new roles for owners, designers,and constructors. 3.5.4 Turnkey Variations Variations on turnkey delivery add financing as a key component.While the financing arrangements are unique for each project,developer-financed projects generally resemble one of the turnkey delivery methods: ¢FDBT-Finance,design,build,transfer; *FDBOT-Finance,design,build,operate,transfer; ¢FDBOOT-Finance,design,build,own,operate,transfer; In each case,the transfer of the project occurs only after the developer's inter- ests and financial obligations have been satisfied,whether the developer owns the facility for the specified period or simply operates it. Developer-financed project delivery occurs most frequently in the United States on private projects.It has also been employed on a limited number of public works projects.Developer financing provides the owner with facili- ties or services that would otherwise not be available through owner financ- ing.While the developer might employ the owner's funds,it is more common that additional financing is sought.Sometimes complex financing packages are assembled that rely on funds from a variety of sources,including bonds, loans,and grants. 22 3.6 FAST-TRACKING:A DISTINCTION Simply stated,the goal of employing fast-tracking is to reduce the project schedule.The fast-track approach compresses the schedule by sequencing the start of construction on underlying project elements,such as foundations and basic supporting structures,before final design (or even conceptual planning) is complete for interior or adjacent elements. Fast-tracking is not a method of project delivery;rather,it is a management strategy within the delivery methods discussed above.While often success- ful in achieving schedule reductions,problems on fast-track contracts can cre- ate a domino effect on follow-on contracts for the project.In other cases, newly constructed elements may need to be modified or eliminated if they cannot accommodate subsequently designed components or structures. However,if properly implemented,the short-term costs of fast-tracking may allow the owner to achieve greater benefits over the long term. Fast-tracking is most successful on projects that are straightforward and have a high level of predictability.Fast-tracking is also preferred when time is so important to the owner that the additional costs due to changes or non-com- petitive pricing are less important.However,the parties involved in fast-track- ing should be experienced in this type of project,and should understand both the benefits and risks of this kind of acceleration. SUMMARY The owner's selection of a project delivery system is one of the most impor- tant decisions affecting quality.Construction industry professionals with expe- rience in relevant systems of project delivery are important resources in the owner's evaluation of internal capabilities,development of project objectives and plans,and assessment of various stakeholder interests.O 23 CHAPTER 4 THE PROJECT TEAM he members of the project team and the way they are organized to work together have a significant impact on project quality.Successful projects require thoughtful conception,skillful planning,up-to-date design,and well- executed construction.Most projects are too large and complex for one team member to perform all the necessary planning,design,and construction. Under traditional design-bid-build (DBB)contracting,the team carrying out these tasks consists of an owner,design professional,and constructor.Under alternative project delivery systems,a single team member may hold both the design and construction roles,and subcontract others who perform tasks or services requiring specialization,unique qualifications,and/or other pro- fessional registrations. Each team member contributes to overall project quality by fulfilling his or her respective responsibilities competently,cooperatively,and in a timely manner.This chapter discusses the organizational relationships of team mem- bers to each other and to other project participants. 4.1 TRADITIONAL TEAM ORGANIZATION AND VARIATIONS Under traditional DBB contracting,the owner heads the team,designating a project manager who is a member of the owner's organization or hired inde- pendently (see Figure 4-1).The owner establishes reporting authority with the design professional and constructor by entering into separate contracts with each.The designer and constructor do not enter into contracts with each other,though they do communicate and should work cooperatively to achieve their respective requirements,consistent with the definitions and relationships in this Guide. The traditional project organization can be adapted to address the wide range of variables encountered on modern construction projects.These include uniquely or specifically defined requirements of public or private owners,and instances where one team member performs two or more primary project func- tions.Some of these variations include: ¢Owner-employed design staff (construction contract only); *Owner-employed construction staff (design contract only); Owner directly employs both design and construction staff; Owner retains a construction manager (CM); 25 In this chapter 4.1 Traditional Team Organization and Variations 4.2 The Owner's Team 4.2.1 Basic Functions 42.2 The Owner's Project Manager 4.3 The Design Professional's Team 4.4 The Constructor's Team 4.5 Common Interests >1.4,"Defining Key Terms” >Chapter 3,"Project Delivery Systems” *Owner selects a single contractor to complete design and construction (design-build); «Owner selects a single entity to complete the design and construction and provide some level of financing,and/or operate and maintain the facility for a specified period (design-build variation). Figure 4-1 Traditional Construction Project Organization OWNER Project Manager In-house staff ¢Specialty consultants ere DESIGN PROFESSIONAL CONSTRUCTOR DesignTeamLeader =f Construction Manager or *Design disciplines Superintendent ¢Construction subcontractors ¢Suppliers/vendors ¢Design subconsultants (associate consultants} *Fabricators *Construction trade workers --Lines of Authority (Defined by Contract) --- Lines of Communication >2.2,"Project Goals” >2.3,"Achieving Project Goals” On even modest-sized projects,the number and complexity of decisions often require that the owner assemble a group of expert advisers. >2.4,"Establishing Project Objectives” 4.2 THE OWNER'S TEAM Even on modest-sized projects,the number and complexity of decisions often require that the owner assemble a group of expert advisers that may consist of in-house staff,independent consultants,or a combination of both, to provide the level of expertise and effort needed to successfully complete the project. The members of the owner's team report to the owner but consult regularly with the project manager,design professional,and constructor.The owner may also delegate authority to a representative empowered to act on his or her behalf. As the initiator of the project,the owner guides the effort by establishing real- istic goals,defining project objectives,and setting the standard for quality. This reduces the potential for confusion about project objectives among team members,increasing the associated benefits to the project cost and schedule. In many cases,the owner's team includes operators,maintenance technicians, and future occupants.Each member is considered a primary stakeholder with a crucial role in achieving project quality.Therefore,the team benefits when the workloads and technical level of the tasks assigned reflect the capabili- ties of the owner's team. 26 The owner's team participates in the establishment of the project objectives and overall performance standards.The core activities of the owner's team include: «Identifying and articulating the basic need for the project; ¢Assisting in the establishing project objectives; *Securing funding; *Acquiring property and applicable permits; ¢Addressing zoning considerations and acquiring applicable permits; *Selecting the design professional and constructor; ¢Establishing material,equipment,and operational standards; «Making design and construction decisions; *Integrating the project with existing facilities; *Monitoring and managing the performance of the design professional and constructor; *Facilitating payment of the design professional and constructor. 4.2.1 Basic Functions The basic function of the owner's team is to initiate and generally guide the project through the planning,design,and construction processes so that the project meets the stated goals and objectives.Though the design professional and constructor are contractually responsible for the vast majority of speci- fied project tasks,several important responsibilities are unique to the owner. These include: ¢Addressing financial,insurance,and legal requirements; Meeting fiduciary responsibilities to shareholders and/or ratepayers; ¢Providing a safe and reasonable work environment for his or her employees; ¢Meeting applicable regulatory requirements; *Making decisions concerning matters under his or her control; *Assigning responsibility for construction site safety. Legal requirements,funding agreements,and contractual arrangements may obligate the owner to additional responsibilities.As projects proceed,new information often becomes available,and it is essential that the owner share this information with other members of the project team,even if it adversely affects project progress in the short term.Likewise,the design professional and constructor should share relevant information with the owner.Open and honest communication among project team members is essential. The members of the owner's team play two key roles that are sometimes con- tradictory in nature:they seek the best design possible to maximize the oper- ating efficiency of the facility,yet they also seek to minimize costs. The potential conflict in these dual roles can surface in efforts to achieve appropriate quality in design.Quality requires investment.In the case of 27 ASCE Policy Statement 350 "Construction Site Safety” >Chapter 5,"Coordination and Communication” Team-based Project Management,James P. Lewis,American Management Association, 1998. The project manager guides the effort from inception to completion. design,this investment involves both time to identify and communicate clearly project requirements,and funding to determine that the design is fully devel- oped and will provide a facility that meets those objectives. Cutting corners on design funding can increase future construction and oper- ating costs.Therefore,the owner's team benefits from establishing a realis- tic schedule for design and securing adequate funding for the design effort. The owner's team benefits by developing the project scope in as much detail as possible before contracting with a design professional or constructor.This helps control costs by reducing the number of revisions during design and construction. When the owner delegates authority to a representative,this person is empow- ered to act on the owner's behalf. 4.2.2 The Owner's Project Manager "Project manager”is a generic title for the person or firm representing the owner that holds overall responsibility for the coordination and management of project activities.Depending on the project scenario,the project manager may be: ¢The owner (typically on smaller projects); ¢The design professional,acting under the direction of a public agency's board of supervisors,such as a city council; ¢A member of the constructor's staff (usually under the design-build approach); *An independent construction manager under contract to the owner. Depending on the project objectives,the owner may contract with more than one design professional,use multiple construction contracts,and/or procure materials directly.In any of these situations,a separate firm may be engaged to serve as the project manager. The project manager is the focal point for project communication and coor- dination.The project manager oversees the entire range of project activities from start to finish,including initiation,planning and scheduling,adminis- tration of owner-design professional and owner-constructor contracts,com- munication and decision management,start-up,and project closeout.While different individuals may serve as the project manager during various phases of the project,continuity of personnel is a benefit to project quality. The project manager's responsibilities begin with project planning and the development of a realistic scope for project design and construction activi- ties.The project manager then obtains commitments from project team par- ticipants to complete these activities in a manner that meets the project requirements and prepares a formal project team organization chart along with a statement of responsibilities for each participant. Next,the project manager develops and confirms the project schedule,includ- ing major milestones and critical path items for both design and construction. 28 With the scope and schedule established,the project manager then identifies the budget needed to perform the specified scope of work within the project schedule.The project manager continually monitors the scope and schedule, adjusting them as necessary to meet the established budget or timeframe objec- tives.If the team determines that the scope and schedule become unattainable as the project proceeds,then additional funding and/or time may be necessary. With the initial planning complete,the project manager finalizes the con- tractual agreement with the design team and begins design start-up activities. These usually include a pre-design meeting,during which the participants establish policies and practices;review requirements and expectations;and address concerns related to program,schedule,budget,project data,quality control formats,and standards.The project manager benefits from making extra efforts in communication during design start-up. After design start-up,the project manager's role shifts to focus on the coor- dination and administration of the overall effort.Progress meetings and design reviews are effective opportunities to communicate with team members, compare actual progress with the schedule,evaluate design elements,ensure contract compliance,monitor costs,and enhance individual performance. 4.3 THE DESIGN PROFESSIONAL'S TEAM The design professional's team develops project concepts,plans,and design solutions that fulfill the owner's project objectives.The owner may engage the design professional for a narrow or wide variety of services,from initial site investigations,to preliminary design and design completion,and the preparation of plans and specifications-as well as design-related services during construction and start-up.The design professional may be an employee of the owner or an independent individual or firm,in which case the rela- tionship and responsibilities to the owner are governed by contract. Most constructed projects are sufficiently complex as to require that the design professional supplement its staff with additional specialized consultants,as only the largest firms usually have the full range of design disciplines in- house.Typical design professional subconsultants include geotechnical; mechanical,electrical,and plumbing engineering;structural engineering; environmental planning;field surveying;materials testing;and other techni- cal specialists.In some cases,design specialists may contract directly with the owner but still function as members of the design team. The general functions and responsibilities of the design professional include: °Being fully qualified and licensed to offer and provide the services con- tractually undertaken and provided; ¢Applying appropriate skills to the design; *Being proactive and clear in communication; *Being responsive to the established budget,schedule,and program; *Making timely interpretations,evaluations,and decisions; *Disclosing fully related external interests; 29 >10.1,"Levels of Design Discipline Organization” >Chapter 6,"Selecting the Design Professional” >Chapter 13,"The Construction Team” ¢Avoiding conflicts of interest; Complying with applicable codes,regulations,and laws; Interpreting contract documents impartially; ¢Representing the owner's interests as required by contract. ¢Performing project-specific duties outlined in the contract between the design professional and the owner. The owner typically uses a qualifications-based selection (QBS)process to engage a design team with professionals who have experience and skills that correspond to the project requirements.The basic task of the team is to design a project that meets the project requirements and to provide the plans,spec- ifications,and other contract documents to the level of completion specified in the contract.In most cases,this means complete design documents from which the entire project may be constructed. In summary,the owner's project role is that of "initiator,”while the design professional's role is that of project "implementor.”To successfully fulfill this role,the design professional must provide the leadership,technical skills,and experience that are appropriate for the design effort. 4.4 THE CONSTRUCTOR'S TEAM The constructor's role on the project team is to plan,manage,and properly execute the construction activities necessary to build the project according to the plans,specifications,and other contract documents prepared by the design professional.The constructor enters into a contract with the owner to carry out these activities. The constructor assembles a team of material and equipment suppliers,spe- cialty subcontractors,material fabricators,construction trades workers,and others to complete the construction.These team members generally contract directly with the constructor. The constructor's general responsibilities include: ¢Establishing the means and methods of construction; ¢Fulfilling the obligations of the contract and approved change orders; ¢Building project elements according to the plans and specifications provided; *Ordering materials and equipment; *Being proactive and clear in communication; *Accepting responsibility from owner for job site safety,including the development and implementation of a comprehensive safety plan (if so delegated); ¢Making decisions in a timely manner; *Being responsible for the performance of subcontractors and suppliers; *Providing skilled construction trade workers; *Coordinating activities with other project team members in a coopera- tive manner; *Complying with applicable codes,regulations,and laws. 30 The constructor provides work that complies with the specifications of the contract documents,and is often required to implement an appropriate qual- ity assurance and quality control (QA/QC)program. 4.5 COMMON INTERESTS Ideally,the members of the project team communicate clearly and often, resolve their differences amicably,and complete projects successfully. However,team members inherently bring differing interests and requirements to a project that can,at times,make it difficult to achieve the project "ideal.” Figure 4-2 highlights the types of differences that can arise among team mem- bers and strategies to resolve them. >Chapter 20,"Quality Assurance and Quality Control” Money Figure 4-2 Team Member Differences and Resolution Strategies Owner is strongly motivated to contain costs. Designer and constructor must operate profitably and receive payments on time. Owner may delay payments due to cash flow problems. Me Issue URAL Typical Differences smite Strategies for Resolution 212s Owner seeks information on prevailing industry costs. Design professional and constructor seek a profit commensurate with the risk,level of effort,and skills required. Owner pays design professional and con- structor in a timely manner. Schedule Owner benefits from completing a project as quickly as possible. Design professional and constructor require sufficient time to assure quality in design and construction. Owner provides design professional with sufficient time to study alternatives and develop a realistic schedule. Participants are informed on permitting needs and construction sequencing. Decision-making Owner (especially on public projects)may need to delay and construction decisions to accommodate changing circumstances. Delays can interrupt the workflow of proj- ect participants. Constructor may experience cost impacts related to inefficient use of labor and materials. Team members are sensitive to the bene- fits that timely decision-making has on the actions of each other and the project as a whole. Performance Team members may find fault with each other's performance in liability situations. Team members strive to define the roles and responsibilities of each party in con- tract documents.*Parties are accountable for their actions and accept the financial and professional liabilities associated with their decisions. Risk should be fairly and clearly allocated by contract to the team ember best able to control that risk. Team members engage in activities,such as partnering and alternate dispute resolu- tion,that are geared toward reducing and resolving conflict and maximizing per- formance. *The process of defining contract terms is itself a benefit in reducing conflict,and the resulting language provides a clear guide for resolving conflicts that do occur. 31 SUMMARY Project participants establish the roles,relationships,and rules that form the project team.The owner holds the central role in forming this team and the contracts that define the relationships among its members.The owner acts as,or designates,a project manager to oversee the wide range and large num- ber of responsibilities involved in coordinating and completing project design and construction. Team members bring inherently different interests and requirements to a proj- ect.Successful project teams are made up of participants who acknowledge these differences and yet share a common commitment to quality.Desirable team member characteristics include a willingness to accept responsibility,a drive for economy and efficiency,cooperation and coordination with other team members,adherence to the established budget,schedule,and program, and an insistence on quality. The structuring of contracts and the effort to clearly define participant roles and responsibilities as early as possible help avoid adversarial relationships that can diminish project quality.0 Chapter 4:The Project Team Typical Responsibilities Responsibility Design Design- Gg Owner Professional Constructor Builder Designate project delivery system eS @ ©O Select and assemble qualified e@ @ e@ e internal staff Select and assemble members of e@ e ©e@ project team Designate project manager r ©O © Complete design to contractually ©e@ O e specified level Construct the facility according to @ @®e e contract specifications Identify common interests and @ e@ e e resolve conflicts @ =Primary Responsibility @ =Assist or Advise ©=Review 32 CHAPTER COORDINATION AND COMMUNICATION o matter what the size or scope of a constructed project,the participants must coordinate their efforts to get the job done.Effective coordination is characterized by appropriate organization,well-defined procedures,the ful- fillment of roles and responsibilities,good controls,the effective use of par- ticipants'skills and experiences,the commitment to good communication, and understanding and respect for the requirements of each participant. Communication is perhaps the most important tool in achieving effective proj- ect coordination.Coordination and communication are closely related,but are distinct in their respective scopes.Coordination includes the broad range of project activities related to the management of people and resources. Communication is the flow of information to support project activities,as practiced in meetings,telecommunication,and written documents. Good project communication may be broadly defined as the free exchange of accurate and relevant information among the right individuals in a timely manner.Good communication among project team members should be clear, honest,open,and frequent-but not excessive.Therefore,achieving effective project coordination depends on the communication skills of the participants and their ability to tailor their communication style and techniques to the proj- ect at hand. This chapter discusses the relationship between project coordination and com- munication,describes the roles and responsibilities of team members related to these two areas,and outlines communication tools and methods that con- tribute to quality in the constructed project. 5.1 KEY TEAM MEMBERS In successful projects,each team designates key contact people to manage coordination and communication.The titles of these positions can vary, depending on the project: W2RES Owner 225642."Design Professional i@#Kxe ConstructorS888 *Project Manager *Project Executive ¢Construction Manager *Project Representative °Design Team Leader ¢Superintendent 33 In this chapter 5.1 Key Team Members 5.2 Developing Coordination Processes 5.3 Team Member Relationships 5.4 Characteristics of Good Communication 5.4.1 Defining Project Communication 5.4.2 Documentation 5.4.3 Forms of Communication 5.4.3(a)Direct Communication 5.4.3(b)Telecommunication 5.4.3(c)Written Communication 5.4.4 Tools and Methods 5.4.5 Meetings 5.4.6 Personal Differences 5.5 Timing and Critical Moments 5.6 Frequency of Communication 5.7 Conflict and Disagreement The more elaborate our means of communication, the less we communicate. Joseph Priestley The owner selects the other team members and determines when they join the project. The people in these positions are usually responsible for overseeing coordi- nation activities.They are responsible for maintaining good communication with the other key team contacts,as well as overseeing communication activ- ities within their own organization.Successful coordination and communi- cation management requires,at the outset,a clearly defined project scope; accurate descriptions of participant duties;and the establishment of appro- priate project controls to monitor progress. 5.2 DEVELOPING COORDINATION PROCESSES Coordination responsibilities and the activities of team members vary widely according to project size and complexity.Building a deck for a home involves less coordination than a deck for a bridge.Highway repairs in congested cities require more coordination than identical repairs in remote areas. The design professional and constructor often possess valuable experience in project coordination.Yet the owner's role is critical in defining coordination processes.Therefore,it is desirable that the owner work closely with the other team members to develop and refine strategies for coordinating the work of the entire team.In addition,coordination and communication requirements of team members evolve as the project progresses.Therefore,all team mem- bers should periodically review the effectiveness of these processes. The following are basic tools and methods to achieve project coordination: ¢A clear definition of the owner's project objectives; ¢Coordination procedures that are appropriate for the project scope; *Schedules and regular updates; *Budgets,cost studies,and alternative proposals; ¢Written contract clarifications; *Progress reports,either written or oral; ¢Joint reviews of documents,models,budgets,and schedules; ¢Adequate distribution and review of field reports and lab tests; ¢Joint visits to work sites,vendors,fabrication shops,and test facilities; ¢Formal compliance reporting; *Procedures for reporting design and/or construction discrepancies; *Well-defined contract change order procedures; *Coordination meetings. Figure 5-1 summarizes these responsibilities during successive project phases of a traditionally managed project. 5.3 TEAM MEMBER RELATIONSHIPS Like any group,constructed project teams evolve from a collection of indi- viduals to a team as they work together.For constructed projects,there are four general stages of a team's evolution.The coordination activities associ- ated with these stages are described in Figure 5-2. 34 Figure 5-1 Typical Team Member Coordination Responsibilities (DBB) Sort toreAREee,Completion/x=Post Completion.ruction #& Form and inform the team. Outline project requirements for the design professional. Submit appropriate per- mit applications. Provide timely decisions in sup- port of design. Participate in design reviews. Timely communi- cate changes when necessary. Administer design contract. Provide qualified inspection and testing as required by con- tract documents and regulatory agencies. Administer contracts. Maintain team coordination and focus on follow- up and comple- tion items. Design Professional Assist in outlining and interpreting project objectives and requirements. Lead the develop- ment of the coor- dination process for the entire team. Lead the design effort. Involve the owner and others at appropriate times. Prepare and coor- dinate necessary design plans and specifications. Assist with obtaining envi- ronmental permits.* Interpret plans and specifica- tions,review shop drawings and submittals,and assist with field problems. Perform field observation. Document com- munications,deci- sions,and observations. Prepare final punch list. Assist with follow-up; Assemble required manuals and record documentation. Assist with start-up.* Constructor Be an early participant. Contribute to alternative studies and constructabil- ity reviews.* Perform vendor and subcontractor selection. Assist in con- structability reviews.* Perform the con- struction work. Supervise and coordinate subcontractors, vendors,and oth- ers for shop drawings,inspec- tions,and other appropriate activities. Field supervision. Lead project close-out. Lead and super- vise subcontrac- tor and vendor completion and punch list activities. Provide warranties. *If permitted by law and selected by owner to participate during this phase of the project. Successful progress through these stages also depends on an atmosphere of honest,open communication.Problems that are not identified,acknowledged, and addressed as they arise can cause a ripple of compounding difficulties throughout a project.In worst-case situations,team members may not be able to fully correct such problems and must then rely on ad hoc strategies to mit- igate undesired impacts. Team members should be able to expect reasonable standards of professional performance from fellow team members.These performance expectations 35 Figure 5-2 Stages of Project Team Coordination 94 Team Member Activities aaaznReeEN 1 Develop a grasp of the project's technical requirements and coordination needs 2 Assess specific compatibility and agreements with indi- vidual team members and their staffs. 3 Develop specific responsibilities for team members with regard to project requirements,work scope,proce- dures,schedules,budgets,and communication 4 Execute a cohesive team effort through cooperative and coordinated actions,clear and timely communication, appropirate decisions,prompt problem resolution,and the fulfillment of commitments. include integrity,honesty,and trust in working relationships;competence in respective professional fields;compliance with contractual and other respon- sibilities;a commitment to achieving project requirements;honest and open communication;and the dissemination of complete information. Of these expectations,honest and open communication and the dissemina- tion of complete information can be among the most difficult to fulfill,as they require collective and individual action.For example,team members who attempt to shield project leaders and co-workers from "bad news,”such as poor product quality,risk the credibility and liability of their organization. This is especially true should the information concern the safety of team mem- bers,occupants,or the required performance of the completed project. 5.4 CHARACTERISTICS OF GOOD COMMUNICATION In the construction industry,some people view communication as a luxury- something that can wait until after the real work is done.However,effective communication saves money and enhances reputations.It helps prevent coor- dination problems that can cause frustration and dissatisfaction among team members and lead to project failures. Studies by project owners of failures,near failures,and problems with newly constructed projects indicate that at least one in four such events results from poor communication or lack of coordination among the project team. Insurance studies show that when owners resort to legal action,litigation is not usually related to imperfections in the project itself,but to coordination and communication problems among the project team.These include last- minute surprises,frustration about issues that have not been addressed,the absence of positive personal relationships,a perceived lack of concern,or incomplete information.The frequency of lawsuits seems to be highest among owners who do not place adequate emphasis on communication or who have limited construction experience. 36 5.4.1 Defining Project Communication Project communication is the sending and receiving of relevant information to appropriate team members.This is a varied and complex process that requires many different levels of effort,skill,and judgment. The speaker,or sender,must decide what information is appropriate for the intended audience,the best forum to present it,and when to deliver it.The listener,or receiver,must grasp the explicit or factual information,ideas,and concepts presented-and ask questions if the message is unclear.The receiver also enhances understanding through subtle or implied aspects of the mes- sage,such as the tone of delivery,body language,vividness of descriptions, and personal feelings expressed. In the exchange of information,it is vital that both sender and receiver strive to identify: ¢Project-related information and objective data; ¢Concerns,opinions,feelings,or subjective items and the degree to which these are (or should be)revealed; ¢Requests for action. Following the exchange of information,it is often helpful for the receiver to summarize to the sender,either verbally or in brief written form,his or her understanding of the information so that misperceptions may be corrected immediately. 5.4.2 Documentation As important as communication is for the success of the project,of equal (or, perhaps arguably greater)importance is the use of appropriate project docu- ments control and maintenance procedures.Project participants are respon- sible for maintaining their own project documentation file.In addition, contractual requirements are generally imposed on specific project parties, most notably the design professional,constructor,and,if utilized,the con- struction manager.Figure 5-1 identifies the design professional as the party that is typically assigned the compilation of the project documentation files. However,both the owner and the constructor (and the construction manager, if used)are required to support this compilation through the maintenance and distribution of certain documents that each is responsible for. 5.4.3 Forms of Communication Different forms of communication are appropriate in different project situa- tions and for different participants.For example,a four-word E-mail from the Project Manager asking,"Where is that report?”will likely be acted upon with greater swiftness and enthusiasm than a four-page memo from Human Resources describing a complicated change in policy. 37 Nothing is so simple that it cannot be misunderstood. J.R.Teague ELI Dynamic Communication for Engineers,Richard McCuen, Peggy Johnson,and Cynthia Davis,ASCE,1993. EL)'Excellent Communication Skills Required'for Engineering Managers,Todd Shimoda,ASCE,1994. >17.2,"Contract Documentation” The Chicago Manual of Style, 14th Edition,University of Chicago Press,1993. The Elements of Style,3rd Edition,William Strunk and E.B.White,Allyn &Bacon, 1995. The Elements of Business Writing,Gary Blake and Robert Bly,Macmillan,1991. The Elements of E-Mail Style, David Angell and Brent Hesiop,Addison-Wesley, 1994. >Chapter 17,"Construction Contract Documentation and Submittals” The following sections describe three general forms of communication and their strengths in the context of a constructed project. 5.4.3(a)Direct Communication Face-to-face meetings and consultations,either in groups or one-on-one,are useful for defining and addressing issues,problems,or complex matters. Direct communication is valuable for its interactive nature,which promotes brainstorming and creative problem solving,and consensus building.Direct communication also lends weight to important announcements,actions,and decisions.Direct communication is often the best opportunity for fostering clear understanding. 5.4.3(b)Telecommunication Telephone calls,teleconferences,and two-way radio are useful for sharing information quickly and connecting people when schedules or geographic dis- tance make face-to-face meetings impractical.With the proliferation of cel- lular phones,pagers,and other wireless devices,telecommunication is enhancing its most considerable advantage:immediacy. 5.4.3(c)Written Communication Memos,E-mail,letters,facsimiles,reports,newsletters,and other documents and publications are valuable for the transmission of information that requires more formality than a conversation or phone call.Written documents (in paper and electronic formats)are the principal form in which project decisions, agreements,and actions are recorded.E-mail,though often used with the frequency and casual nature of a telephone call,is a permanent record. 5.4.4 Tools and Methods The right communication methods for achieving good coordination vary with each project.Small projects,such as a garage or backyard landscaping,often succeed on the contractor's word and a handshake.But as for larger and more complex projects,communication must be more formal and frequent to coor- dinate the greater number of activities.Major construction projects today often involve hundreds of team members spread out over dozens of locations.These efforts require advanced telephone and computer networks,document track- ing systems,couriers,meetings,and other communication tools to keep infor- mation flowing. Typical communication activities and tools include: ¢Team meetings with subconsultants and subcontractors as appropriate; *Telephone calls and teleconferencing; ¢Facsimiles (faxes); ¢Meeting minutes or summaries noting follow-up responsibilities; *Memos and letters with appropriate distribution; ¢Transmittal letters; *Newsletters and internal updates; *Couriers and overnight delivery services. 38 E-mail and the Internet have expanded the communication tools and strate- gies available to construction project teams.Advanced and specific applica- tions of these tools continue to evolve rapidly.Common computer-based communications include: E-mail and electronic file transfers,including entire texts of construc- tion documents; World Wide Web sites for external and secure internal use; ¢Internet newsgroups; ¢Video conferencing. 5.4.5 Meetings Of the many communication tools listed above,meetings deserve special attention because they can be one of the most productive tools for providing continuing coordination for projects.However,to be effective,meetings should be brief,well planned,and conducted by a knowledgeable meeting leader.Teleconferences with remote participants can be useful,but their effi- ciency depends more heavily on the three characteristics above. There are two general types of project meetings: 1.Regular meetings (daily,weekly,monthly),which usually have a stan- dard agenda and are held to track progress,identify problems,and resolve low-level conflicts. 2.Special meetings to address particular situations or problems. In either type of meeting,the following guidelines for the meeting leader can help participants make the most of their time: *Call meetings when direct communication and/or problem solving are needed. ¢Explain the purpose of the meeting and clearly define each agenda item as informational,needing discussion,or action. ¢Solicit approval of changes to the agenda to allow the meeting to flow smoothly. ¢Estimate the amount of time needed for each agenda item,as well as the entire meeting.Keep presentations and discussion moving. *Encourage participation but ask that contributions be relevant. *Use a large easel tablet or board to summarize important discussion points,decisions,responsibilities,dates,and other key information. *Briefly critique the meeting with respect to its length,format,and use- fulness to participants,as well as potential improvements. ¢Prepare minutes or brief written summaries of actions,agreements,con- clusions,continuations,and assignments.Distribute minutes to atten- dees as soon as possible. 39 >Chapter 21,"Computers and Project Quality” We have become the tools of our tools. Henry David Thoreau How to Hold Successful Meetings,Pau!Timm,Career Press,1997. 5.4.6 Personal Differences Good project communication requires the recognition of the inherent differ- ences among team members.Owners,design professionals,and constructors have different backgrounds,qualifications,expertise,and expectations.They may also have different definitions of a successful project.There may be sig- nificant differences in individual preferences among the members of each team staff.These can include: ¢Preferences for working alone versus in a group; e A tendency to make decisions in a deliberate manner versus taking prompt action; *Placing emphasis and value on creativity versus established procedures; *Placing value on detailed analysis versus grasping broad concepts; *The use of different methods for expressing and _handling disagreements; *Preferences for deferential versus direct approaches in personal relationships. For coordination and communication to be effective,team leaders must under- stand and compensate for individual differences.For example,a design team member who works best alone may need patient reminders to improve coor- dination with other team members.A gregarious,outgoing project manager may inspire creative problem solving,but may need support to catch routine details that would otherwise slip through the cracks. 5.5 TIMING AND CRITICAL MOMENTS Timing is another critical aspect of project communication.If information is premature,late,or not distributed among staff in the appropriate sequence, coordination suffers.Frequent contact among team members tends to pro- mote the timely completion of project tasks.When team members receive key items late,such as changed objectives or specifications,they may react neg- atively,and schedules or quality of work may be jeopardized. The following are examples of times or situations in the life of a project when coordination and communication among team members become especially critical: ¢During the process of defining the scope,budget,and schedule; ¢During the definition of performance and quality criteria,and the reach- ing of an agreement on the refined project scope; ¢While conducting alternative or feasibility studies affecting scope; ¢When reviewing construction contract document language and requirements; «When assessing economic or scheduling impacts; ¢At major design phase milestones; ¢When evaluating proposals from the constructor or a supplier for alter- native methods,materials,or equipment; ¢During unexpected situations that require changes in schedule,scope, procedures,costs,or materials; 40 ¢When dealing with significant problems of design or construction; ¢Upon achieving major construction milestones. When team members are not appropriately involved during the periods listed above,or are not consulted about problems that directly concern them,they may develop negative,uncooperative attitudes that are not conducive to achieving quality. 5.6 FREQUENCY OF COMMUNICATION The effectiveness of project coordination increases with the frequency of good communication.Frequent contact provides team members with increased opportunities to assess workloads,identify critical path items,and develop solutions to problems.Frequent contact can serve as a backup for other types of project communication.For example,a meeting offers team members the opportunity to clarify what may have been said in a letter.Frequent commu- nication aids participants in building a common project vocabulary that fur- ther enhances understanding. But as crucial as communication is to project success,there is a distinct dan- ger of over-communicating.For example,if routine information is distributed widely regardless of its importance,the result may be that important issues are ignored.Over-communication detracts from the project team's effective- ness because people have to spend time trying to figure out if the informa- tion they just received is important.Good communication requires judgment in determining how much is enough (over-communication is preferable to under-communicating).If information senders are not sure if they are strik- ing the right balance,one strategy has proven effective in nearly every situ- ation:ask the recipient. 5.7 CONFLICT AND DISAGREEMENT While efforts to manage and improve coordination and communication reduce the likelihood of conflict,disagreements will occur.In these cases,team lead- ers must increase their efforts to improve communication among the parties in conflict-even themselves-through a variety of strategies,including: e Handling disagreements as soon as possible.Postponement can lead to frustration and the hardening of opposing positions. e Identifying the project requirement at the heart of the disagreement to help the team avoid irrelevant issues. e Addressing the easier issues first,proceeding one issue at a time. ¢Encouraging participants to listen to all relevant facts and feelings before attempting to resolve the problem.Attempting to solve a problem too quickly can escalate or confuse the situation. ¢Developing more than one alternative for resolution. e Striving for team consensus on a course of action.Forced solutions can create distrust and/or dissatisfaction. e If the representatives closest to the problem cannot resolve their dif- ferences within a reasonable time,it is beneficial to move the dispute to a higher management level so that the work at lower levels continues. 41 Frequent contact promotes the timely completion of tasks. >Chapter 24,"Partnering” If the team cannot reach a consensus in resolving a technical or programmatic problem,it is the responsibility of the owner,after consulting with the other team members,to select a preferred alternative and move the project forward. The owner will benefit from clearly communicating the reasons for such an action to the team members.Prolonged indecision can be damaging,partic- ularly if it disrupts project continuity.Each manager involved in the project organization must make the best use of his or her skills and authority to resolve conflicts prudently but quickly and at the lowest level of the organization possible. SUMMARY Project coordination and communication go hand in hand.Coordination relies on the selection and implementation of an appropriate set of management tools and strategies.An essential building block of successful coordination is the development of a mutual understanding of the duties for which each team member is responsible during different phases of the project.Team members must work together to develop coordination processes that incorporate a clear definition of participants'responsibilities,the agreements entered into to meet those responsibilities,and supporting coordination tools to achieve them. While direct and written communication are central to achieving good coor- dination,the rapid evolution of telecommunications and computer-based infor- mation technology is transforming the patterns of project communication.In particular,cellular telephones,pagers,E-mail,and facsimiles have changed communication expectations and work patterns.The immediacy of telecom- munication is both an advantage and an encumbrance among modern project teams.Good communication involves choosing the right tools-and exercising good judgment before using them.0 Chapter 5:Coordination and Communication Typical Responsibilities Responsibility Design Design- Gg Owner Professional Constructor Builder Planning the coordination process @ @®@ © Initiate frequent contacts @ @ @ Cd] Evaluate quality of communication @ @ e @ Establish meeting schedules*e ©©)© Initiate conflict management efforts e e@ e e *May vary with project phase,i.e.planning,design,and construction. @ =Primary Responsibility @ =Assist or Advise ©=Review 42 CHAPTER 6 SELECTING THE DESIGN PROFESSIONAL Siccine the design professional is a critical step in achieving projectquality.The owner is the central figure in the process of selecting the design professional,with the responsibility for crafting and administering procedures to identify and engage a design professional with the necessary experience,technical resources,availability,and commitment to succeed. The owner's dedication to quality issues during the selection of the design professional helps establish the qualifications-based approach to project activ- ities that carries through the entire endeavor. This chapter presents details on the selection procedures for choosing a design professional for a design-bid-build (DBB)project. The owner's project goals and requirements are central in choosing an appro- priate selection process,as well as the appropriate project delivery system. Under alternate forms of project delivery,such as design-build and turnkey, the owner may also use these practices to screen or select the design-build firm,or the constructor may use them to screen or select the design profes- sional for the design-build or turnkey team. 6.1 PROJECT GOALS AND THE DESIGN PROFESSIONAL'S SCOPE OF SERVICES As a first step in any selection process,the owner defines the general project goals.These are typically broad and include the type and size of the pro- posed project,the preliminary budget,schedule,necessary site mitigation measures,legal constraints,safety concerns,and quality-related goals.Once established,the project goals are a key consideration in determining the appro- priate procedure for selecting the project delivery system and the design pro- fessional,and for establishing the scopes of services to be provided. Short-term budget concerns often put pressure on a public owner to ignore life-cycle cost considerations and opt for lowest-cost design services. However,this is usually not in the owner's best interest.Design costs typi- cally total less than five percent of life-cycle costs.Yet,during design,the major decisions that affect costs for construction,operation,and maintenance are made.There may be occasions where a private owner will transfer own- ership of the project early in its useful life.In these cases,the private owner may wish to minimize design and construction costs and seek the lowest cost design services.However,even in these situations,it is likely that the increased sale price of a well-designed project will more than offset the increased design 43 In this chapter 6.1 6.2 6.3 6.4 Project Goals and the Design Professional's Scope of Services Qualifications-Based Selection (QBS) 6.2.1 Owner's Selection Committee 6.2.2 Selection Criteria 6.2.3 Request for Qualifications (RFQ) 6.2.4 Evaluation of Qualifications 6.2.5 Request for Proposal (RFP) 6.2.6 Interviews 6.2.7 Additional References 6.2.8 Award Recommendation 6.2.9 Negotiation 6.2.10 Subsequent Negotiation through the Ranks 6.2.11 Agreement for Professional Services Competitive Bidding 6.3.1 Competitive Bidding Procedures 6.3.2 Disadvantages of Competitive Bidding Two-Envelope Selection Life-Cycle Cost:The total cost of developing,designing,construct- ing,Owning,operating,and main- taining a facility for its design life, as well as decommissioning costs. ASCE Manual 45,Cansulting Engineering:A Guide for the Engagement of Services, 1996,Appendix 1, "Submission of Qualifications” Brooks Act Code of Federal Regulations Title 40,Public Buildings, Property and Works,Chapter 10,"Management and Disposal of Government Property,”Subchapter VI, 9541-544 cost incurred by using the most qualified design professional.For both pub- lic and private owners,minimum cost design may omit the analysis of alter- native solutions that could dramatically improve project outcomes. The detail and specificity of the scope of design services vary with the size and complexity of the effort.The scope can range from a general statement of the facility's performance specifications to an extensive itemized descrip- tion of each task.The scope should also specify the owner's requirements for professional design services during the construction and start-up phases. Owners that manage construction projects,or those with large facilities depart- ments,often have the in-house capability to prepare a well-defined scope of design services for use during the selection of the design professional.Owners who do not regularly undertake construction projects usually benefit from engaging an independent design professional to develop the scope of services. In general,greater precision in the scope of services produces a clearer under- standing on the part of the owner and competing design professionals about the designer's expected qualifications to achieve the desired level of quality. 6.2 QUALIFICATIONS-BASED SELECTION (QBS) Qualifications-based selection (QBS)is the generally accepted practice for design-bid-build contracting,particularly on public works projects.Under QBS,the owner selects the design professional on the basis of qualifications submitted before the final scope and fee are negotiated.QBS is required on federally funded projects and on projects administered by many states and municipalities.The 1972 Brooks Act (P.L.92-582)requires QBS in the pro- curement of architectural and engineering services on federal projects.Many states and municipalities have adopted similar statutes,known as "mini- Brooks”acts. With QBS,design professionals submit statements of interest and qualifica- tions in response to an owner's invitation or advertisement,known as a request for qualifications (RFQ).The owner and/or designated selection committee evaluates the responses according to the selection criteria provided in the RFQ. In many cases,the owner develops a short list of the top three ranked design professionals and conducts personal interviews with each before making a final selection. Owners and design professionals tend to be more satisfied with the results from contractual agreements in which the parties agree on the design pro- fessional's fee after the full scope of services is established and understood. Depending on the size and complexity of the project,reaching this level of understanding may require extensive discussions and effort.Professional expe- rience and knowledge play a crucial role in achieving a satisfactory contract agreement. Sections 6.2.1 through 6.2.11 below describe typical QBS elements and procedures.Owners may omit,modify,or combine some of these steps if a well-established and satisfactory relationship exists with the design profes- sionals involved. 44 6.2.1 Owner's Selection Committee On large projects (approximately $10 million and greater),the owner often designates a design professional selection committee.(On smaller projects, the owner typically carries out the following activities on his or her own.) This committee requests and evaluates the design professionals'qualifica- tions,reviews proposals,makes appropriate inquiries,checks references,and conducts interviews.The owner's final choice of the design professional is based upon the recommendations of the committee. Ideally,the design professional selection committees include at least three individuals with the experience and qualifications to make insightful judg- ments about the ability of the design professional to meet the owner's require- ments and project goals.To avoid conflicts of interest,committee members are not affiliated with competing design firms.Typical selection committee members may include: ¢At least one professional engineer or licensed architect; ¢The owner's principal contact with the design professional; ¢The owner's construction project manager; *The operations manager of the future facility; ¢An owner representative authorized to make subjective judgments on aesthetic project elements involving architecture or public perception. On smaller projects,the owner may not formally convene a committee,but may assemble experienced staff or even engage a consultant to assist in the selection of a qualified design professional. 6.2.2 Selection Criteria Although many design firms possess similar qualifications,no two will have identical strengths in experience,skills,resources,training,workload,tech- nical capabilities,or project-specific expertise.Therefore,the owner and selec- tion committee members work to craft selection criteria that simplify the task of separating design firms that have the appropriate qualifications from those that do not.Typical design professional selection criteria are summarized below. Ethics:The professional and ethical reputation of the design professional,as determined by inquiries with previous clients and other references. Professional Registration:Professional registration of the principals and other responsible members of the design pro- fessional's organization in their state of resi- dence,and registration or qualification to obtain registration in the state in which the project is to be located. 45 wy Cornell University Law School: www4.law.cornell.edu/us code/40/ch10.html Federal Highway Administration: www/fhwa.dot.gov/ engineering Selection and Use of Engineers,Architects and Professional Consultants: Guidelines for Public Agencies Second Edition, American Public Works Association,1997 Downloadable RFQ Forms vy SF 254: www.gsa.gov/pbs/pc/hw_ files/sf254.doc CSF 255: www.gsa.gov/pbs/pc/ hw_files/sf255.doc Specific Qualifications:The design professional's demonstrated quali- fications and capability to perform the scope of services,including knowledge of codes or other governmental regulations. Similar Experience:Evidence that the design professional has per- formed similar services on equal,or more diffi- cult,projects. Resources:Evidence that the design professional has the financial resources and business background to accept the assignment and provide full,contin- uous service. Availability:The design professional's ability to provide appropriately qualified staff to the project and complete the required services within a time- frame that supports the project schedule. 6.2.3 Request for Qualifications (RFQ) In a qualifications-based selection procedure,the qualifications of the prospec- tive design organizations are the selection factor.The owner or selection com- mittee issues an RFQ,which can be a direct invitation to specific designers or a public notice or advertisement stating the general nature of the proposed project and requesting statements of qualifications and experience from design interested professionals. In the RFQ,the selection committee specifies the format for submission of the written qualifications.Although corporate resumes and marketing mate- rials may be acceptable,designers are often asked to submit modified U.S. Government standard forms 254,Architect-Engineer and Related Services Questionnaire and 255,Architect-Engineer and Related Services Questionnaire for Specific Project.The standardized format allows the selec- tion committee to easily compare the qualifications of key personnel and rel- evant project histories.Private owners may also request these standard forms or modified versions of them for obtaining qualifications. 6.2.4 Evaluation of Qualifications The committee evaluates the statements of qualifications received against the selection criteria.The committee contacts references and reviews the past performance of prospective design professionals to identify a minimum of three who appear to be qualified for the project.If more than three organiza- tions appear qualified,the committee may ask more than three to proceed with the selection process.The committee also advises design professionals that obviously do not meet the required qualifications that they will not receive further consideration. 6.2.5 Request for Proposal (RFP) The owner or committee next selects three candidate designers (or more,if desired and qualified)to receive a request for proposal (RFP).Unlike the more 46 general RFQ,the RFP describes the proposed project in as much detail as possible and includes the scope of design services to be performed.The owner invites each RFP recipient to submit a proposal describing a work plan,key personnel to be assigned,the schedule planned for completion,the location where the work will be performed,the firm's financial capacity,and other appropriate information.For large or complex projects,the design profes- sionals may be invited to a pre-proposal meeting,often held at the proposed project site,to review available information and ask questions. At this stage of the selection process,the design professional may benefit from learning as much as possible about the owner's history,mission,and capacity to support the project by conducting a thorough reference check. 6.2.6 Interviews On receipt of proposals,the owner invites the best-qualified design profes- sionals to meet with the selection committee for separate interviews.At the interview,key personnel to be assigned to the project present their firm's and their own qualifications and experience record,capability to complete the work within the allotted time,resources to complete the project,and proposed project approach.This step allows the committee to better gauge each design professional's project understanding and ability to meet the project objectives (various state and federal agencies may modify the inter- view process). 6.2.7 Additional References Following the interviews,the selection committee may broaden its reference investigations of each design professional under consideration.It is impor- tant to determine the quality of performance on projects other than those ref- erenced by the design professional. 6.2.8 Award Recommendation The selection committee then ranks the design professionals based on their ability to meet the selection criteria,as well as the information obtained at the interview and the reference check.Upon the acceptance of the selection committee's recommendations for award of the design contract,the owner usually discharges the committee. 6.2.9 Negotiation Following the discharge of the committee,the owner invites the top-ranked design professional to appear for a second presentation.At this point,the owner and design professional combine their capabilities,experience,and judgment to fully develop the scope of services.If appropriate,participation in the construction phase and other activities such as right-of-way acquisi- tion,equipment procurement,start-up,and preparation of operation and main- tenance manuals can be negotiated and included in the professional services agreement. Once the full scope of services responsive to the project goals and to the owner's schedule and budget is developed,the owner and design professional 47 >Chapter 7 "Agreement for Professional Services” Competitive bidding for design services is not allowed on federal projects or on many state and municipal projects. negotiate a fair and equitable compensation for the services to be provided. The owner evaluates the compensation requested based on previous experi- ence and the range of charges reported by other users of similar services. Fair compensation allows the design professional to utilize his or her full expertise,and thus is vital to the success of a quality project. 6.2.10 Subsequent Negotiation through the Ranks If the owner cannot reach agreement with the first design professional selected,the owner terminates negotiations by written notice.The owner is then free to begin negotiations with the second most qualified design profes- sional or the third,if necessary,until agreement is reached.The owner may also refine the project goals and begin the selection project again.All such negotiations are strictly confidential,and the compensation discussed with one firm is not revealed to another. 6.2.11 Agreement for Professional Services When agreement has been reached on scope of services,level of effort,com- pensation,and schedule,the owner and selected design professional formal- ize their negotiations in a written agreement.The owner then promptly notifies the firms that were not selected. 6.3 COMPETITIVE BIDDING This practice is used on DBB projects in some states and municipalities where permitted by law,as well as some design-build projects in which the owner delegates a great deal of control to the constructor.Federal regulations,how- ever,require a QBS procedure for short-listing firms for design-build proj- ects before final selection. Although professional engineering,construction,and architectural societies view low-price bidding for the procurement of professional design services as counterproductive to quality and not in the owner's best interest because it ignores life-cycle cost evaluations,low-price bidding is not considered inherently unethical.However,competitive bidding for design services is not allowed on federal projects or on many state and municipal projects under the Brooks Act and similar state statutes. 6.3.1 Competitive Bidding Procedures In instances where competitive bidding is to be used,the owner first prepares a complete and comprehensive set of bid documents and contract provisions. Design professionals are invited to submit a price,either lump sum or an estimate not to exceed,for the described scope of work.The owner com- pares the bids and selects the design professional submitting the lowest bid, either in terms of price or hours of effort.The owner may require that the designer be pre-qualified,with the owner's agency or others,to be eligible to bid. 48 6.3.2 Disadvantages of Competitive Bidding Competitive bidding often does not serve the best interest of overall project quality for a variety of reasons,including: *The low bidder may not be fully qualified to perform the services. ¢It is rare for an advertised scope of services to contain all the design services required,resulting in amendments to the design professional's agreement and construction change orders. ¢The nature of the agreement may limit the ability to achieve a "meet- ing of minds”on difficult project goals or objectives. *Contracting on the basis of a limited scope and fee tends to reduce the number of opportunities for alternative studies and evaluation,and also limits the flexibility available to the owner and designer in solving prob- lems that may arise as a project proceeds. ¢Skimping on design costs often increases the number of construction change orders,misunderstandings,and other unplanned events and reduces the attention paid to operating and maintenance efficiencies,all of which tend to drive up life-cycle costs. 6.4 TWO-ENVELOPE SELECTION In the two-envelope system,each design professional gives the owner a tech- nical proposal in one envelope and a price proposal in another.The owner opens the "technical”envelopes first,evaluates the proposals in a manner sim- ilar to QBS procedures,and selects the best qualified design professional solely on the basis of technical merit. After the selection of the designer,the owner opens that firm's price enve- lope and uses that cost information as the basis for negotiating the agreement for design services.The owner may hold the remaining price envelopes unopened in case negotiations with the first firm are unsuccessful.In that event,the owner may open the second-ranked firm's price envelope and begin negotiations.After the owner enters an agreement with a design professional, it is accepted practice that the remaining price envelopes are returned to the remaining firms unopened. During the negotiation of the professional services agreement,the owner and best-qualified design professional may work together to establish the final scope of services.Upon agreement of scope,the price of services is negoti- ated to reflect changes from the owner's original scope or the designer's tech- nical proposal.This provides the owner with the benefit of the design professional's knowledge and expertise,similar to the QBS process. The owner may modify the two-envelope procedure and open the price envelopes of all proposing firms,thereby creating a modified version of the bidding process described above.However,the decision to open all price envelopes should be announced to competitors before the submittal of pro- posals-not after. 49 >6.2,"Qualifications-Based Selection” >Chapter 3,"Project Delivery Systems” >Chapter 7,"Agreement for Professional Services” Because the Brooks Act and similar statutes prohibit public owners from engaging design services on the basis of competitive bidding,the two-enve- lope system has an advantage in design-build projects in which the owner intends for the design professional to take a lead role.The two-envelope sys- tem provides the owner with the benefits of the QBS process for design,yet creates a competitive environment and secures a fixed price for construction by obligating the proposing firm to the price in its sealed bid.However,on design-build projects where the owner places the constructor in charge,con- structors tend to prefer competitive bidding. SUMMARY Qualifications-based selection procedures generally offer the owner several advantages in procuring the services of a design professional.These include securing a designer that is fully capable of meeting the project goals with the experience and expertise to develop a specific scope of services,schedule, and budget before contract terms are finalized.QBS also allows the owner and design professional to agree on a fee that is fair and based on the scope of services.A negotiated agreement for design services generally provides more opportunities to achieve creative solutions to design problems that will ultimately control the project's life-cycle cost and quality. Procuring the services of a design professional under competitive bidding or the two-envelope system is sometimes used to help meet the owner's short- term financial goals.These procedures limit the ability of the owner and design professional to fully address design concerns that may arise as the proj- ect proceeds.These procedures also ignore the life-cycle cost of the project and the role of the design professional in minimizing that cost. The preferences for the design professional selection procedures described in this chapter,as well as the numerous variations employed by owners,con- tinue to evolve.The increasing popularity of design-build contracting and its various permutations has broadened the range of opinion on the best way to deliver the project.This,in turn,has affected owner requirements related to the selection of the design professional.Therefore,the owner benefits by investing time and energy in assessing the potential strengths,weaknesses, and risks of different design professional selection procedures,keeping in mind the particular goals and objectives of the specific project.O 50 Chapter 6:Procedures for Selecting the Design Professional Typical Responsibilities Responsibility Design Design- UO Owner Professional Constructor Builder Establish selection policy and procedure @ Invite statements of qualifications (RFQ)@ Submit qualifications O e @ Invite design proposals @ Follow announced procedures for e@ selection of designer Prepare preliminary scope of work O e e@ Estimate cost of scope O @ e@ Agree on final scope and cost e r )e Negotiate contract e e e@ @ =Primary Responsibility ©=Assist or Advise ©=Review 51 CHAPTER 7 AGREEMENT FOR PROFESSIONAL SERVICES fter the design professional is selected,the next step in defining and achieving quality in the constructed project is preparation of the profes- sional services agreement between the owner and the design professional. This agreement documents the commitments made during negotiations between these two parties for professional design services during each phase of the project. The owner and design professional need sufficient time to negotiate,define, and write a clear and fair agreement for professional services.As these par- ties reach a "meeting of the minds”regarding their respective duties and responsibilities,each has the opportunity to review the project objectives and make improvements.Negotiations are an important first step in building mutual trust and shared project understanding,qualities that will help avoid problems and conflicts later. Although most professional services agreements are prepared for a unique set of conditions and project objectives,standard-form agreements can be help- ful in preparing an appropriate project-specific agreement.Obtaining a legal review of the contract terms and language is strongly recommended.A review of business issues and the practicality of performance is equally important. This chapter discusses issues related to professional services agreements between the owner and the design professional in terms of the traditional design-bid-build (DBB)project delivery system.However,project delivery systems and the organization of the design professional's team can vary widely.Therefore,this chapter also addresses other design professional serv- ices-related contractual agreements,including subconsultant agreements, agreements between the owner and additional design specialists,construction management agreements,and design-build agreements. While this chapter addresses the concerns of the owner engaging an outside consultant for design services,many owners possess in-house design capa- bilities,alleviating the need for outside design contracting.But internal design functions are similar to those of a consultant,including budgeting,estimat- ing staff hours,and addressing legal concerns.Therefore,in-house directives benefit from many of the same considerations as formal agreements with out- side consultants. 53 In this chapter 7.1 Purpose of the Professional Services Agreement 7.2 Elements of the Agreement 7.2.1 Project Phases and Scope of Services 7.2.2 Instruments of Service 7.2.3 Fee for Services 7.2.4 Owner's Responsibilities 7.2.5 Procedures to Amend the Agreement 7.2.6 Other Provisions 7.3 Standard-Form Agreements 7.3.1 Professional Societies and Associations 7.3.2 Government Agencies 7.3.3 Owners,Design Professionals,and Constructors 7.4 Short-Form Agreements 7.5 Other Design Contracts 7.5.1 Subconsultant Agreements 7.5.2 Multi-Prime Agreements 7.5.3 Construction Management Contracts 7.5.4 Design-Build,Turnkey, and Developer-Financed Contracts 7.6 Cautions Concerning Non- Traditional Contracting Relationships 7.6.1 Joint Venture Agreements 7.6.2 Partnering Agreements >Chapter 3 "Project Delivery Systems” Negotiation and Contract Management,David C. Johnston editor,ASCE Press, 1985. A contract that has not been negotiated is a contract that neither party understands. C.Edwin Vick,Jr. 7.1 PURPOSE OF THE PROFESSIONAL SERVICES AGREEMENT Pre-contract negotiations between owners and design professionals involve discussions on a wide range of subjects,including the respective requirements or expectations of each participant.These negotiations can be lengthy and involve many individuals.Therefore,the professional services agreement is an especially important means of summarizing the negotiations and record- ing the consensus of the parties on the project goals and objectives and each party's role. Ideally,the negotiation team should include the leaders from the owner and design professional parties as well as the staff members who will help exe- cute the agreement.The participation of team leaders and senior staff mem- bers is important to create a written agreement that will communicate their intentions and goals to many others who become involved with the project later.These people may include facility operators,those involved in related construction projects,and,in the event of a dispute,claims analysts,media- tors,and legal professionals. The design contract is more than a statement of the rights and responsibili- ties of the parties.Its development stimulates both parties to plan their actions and interaction.In some cases,parts of the contract may become a "proce- dures manual.” 7.2 ELEMENTS OF THE AGREEMENT Typical agreements between the owner and design professional consist of two parts.The first part,known as the "scope/schedule/fee”section,establishes issues that are unique to the project,including: ¢Scope of design services to be provided; ¢Schedule/time of performance for the contracting parties; *Fee (a short term for the more proper and comprehensive expression, compensation)for design professional services; *Owner's responsibilities. The second part consists of the terms and conditions,often known as the general conditions or provisions.These sections address common issues such as procedures for amending the agreement,standards of performance, insurance coverage,allocation of risks,and termination.The owner and design professional benefit from developing a thorough understanding of all the terms and conditions (including references to external documents),espe- cially in the context of construction industry norms and potential impacts to items in the scope/schedule/fee section,and modifying any terms to address project-specific objectives and requirements. In formal contract documents,the terms and conditions typically appear first, with the scope/schedule/fee provisions provided in exhibits.With less com- plex projects where simpler agreements are appropriate,such as letters or sim- 54 ilar short forms,the scope/schedule/fee can be given first,with the terms and conditions attached and included by reference. 7.2.1 Project Phases and Scope of Services The development of project objectives and the scope of services that are to be provided by the design professional are closely related activities.This section discusses the different responsibilities that may be assigned to the design professional by the scope of services during successive phases of a project and describes how the professional service agreement addresses related issues. The services that a design professional provides during a complete constructed project are generally considered to be divided into six parts,defined in ASCE Manual 45 as: The study and report phase; The preliminary design phase; The final design phase (producing contract documents); The bidding,or negotiating,phase for construction services; The construction phase;AuwPwnNSEThe post-construction,or operation,phase. Most participants in the design and construction industry advise that one design entity furnish services through all six phases,especially including the design professional's services during the construction phase.A single design professional provides continuity,consistency and efficiency,enhances coor- dination,and establishes and maintains clearer lines of professional account- ability to the owner,which improves quality.In addition,the use of a single design professional can help control costs because negotiation and "learning curve”time for new design professionals at each successive phase is reduced. The design agreement specifies the project phases and the professional!serv- ices to be provided in each,subdivided into discrete,project-specific tasks. The mutually agreed-to definition of these tasks is referred to as the "scope of services”(a term preferred over "scope of work”).The negotiated scope forms the basis for the schedule and fee for each phase.The owner's respon- sibilities and the schedule under which they are to be performed are also recorded in the agreement. Many factors determine which tasks will be in the design professional's scope of services,including the manner and timing of selecting the constructor and the owner's construction budget.For example,competitive bidding for con- struction services may require that design be completed in greater detail than with negotiated pricing.If the constructor joins the project team during design, the design scope might include more meetings with the constructor but fewer construction alternatives because the constructor can help guide the team to the most economical methods. 55 ASCE Manual No.45, Consulting Engineering:A Guide for the Engagement of Engineering Services,ASCE, 1996. EJCDC The Engineers Joint Contract Documents Committee (EJCDC)is a voluntary committee with mem- bers from ASCE,the National Society of Professional Engineers (NSPE},and the American Consulting Engineers Council (ACEC).Representatives of the American Public Works Association ({APWA)and the Associated General Contractors (AGC)are also active in EJCDC activities. ty www.pubs.asce.org/contract.html EJCDC Doc.1910-1 (future: E-500)Standard Form of Agreement Between Owner and Engineer for Professional Services >7.2.5,"Procedures to Amend the Agreement” In general,specific and detailed scopes of services lead to better quality proj- ects.The owner and design professional benefit from quantifying,to the great- est extent practical,the level of effort required.This may include specifying the number of design alternatives to be explored,meetings,site visits,copies, and other deliverables.Expectations of each party are thereby clarified,the risk of surprises is reduced,and the potential for disputes is minimized. The design professional's scope of services may include scheduled periods of inactivity between successive project phases for the owner's review and approval.Or the owner and design professional may agree to compress the project schedule by beginning successive design phases while the previous phase is being reviewed.Compressing the design schedule requires experi- ence and trust,as well as greater budget contingencies,but can be a benefit by saving critical time. During many projects,the owner finds it advantageous or necessary to change the scope of design services.The owner benefits from making these changes in consultation with the design professional so the modifications in scope and schedule are clear,achievable,and matched with equitable compensation. 7.2.2 Instruments of Service Under most professional service agreements,it is the design professional's responsibility to produce documents that are among the end results of the tasks outlined in the scope of services.These documents,often known as "instruments of service”or "deliverables,”are described in the agreement. The sequence of their delivery to the owner sets the design professional's schedule.These documents may include: ¢Schedules; ¢Preliminary reports of project feasibility; *Opinions of probable costs; ¢Reports of alternative investigations and other studies; ¢Reports of project impacts on the environment or infrastructure; *Preliminary design and outline specifications; ¢Final design; ¢Construction contract documents,including plans and specifications; ¢Reports on construction activities; *Record drawings and final project reports; *Operating and maintenance manuals. Standard industry forms for design-bid-build call for the design professional to retain ownership and copyright in his or her design.This is to protect against use of design documents on future projects without the original designer's input and where design intent is violated to the owner's detriment.For exam- ple,the owner can be granted specific rights of use in connection with man- aging the completed facility,and the owner may want the freedom to engage other design professionals for modifications,subject to the obligation to 56 indemnify the original design professional for any misuse or unauthorized modification of the design professional's documents.Similarly,the design professional has interest in preventing the unauthorized reuse of the docu- ments,as well as retaining any special proprietary ownership of the concepts and details reflected in the documents. 7.2.3 Fee for Services The agreement for professional services establishes the amount and terms of payment to the design professional for services provided.ASCE Manual No.45 describes several methods of payment for professional services, including: *Hourly or per diem rates; ¢Retainer; ¢Salary costs times multiplier plus direct non-salary expense; *Cost plus fixed fee; *Lump sum; ¢Percentage of construction cost. In general,cost-or effort-related fees are appropriate where the services to be performed have not been,or cannot be,well defined.These methods may be used in a simple arrangement,or there may be auditing procedures added. Lump-sum fee arrangements are appropriate when the scope of services is set without ambiguity by mutual consent of the parties.It is always important to make clear which,if any,direct expenses are reimbursable and which are included in the lump sum.Fees based on a percentage of construction cost are less frequently used due to lack of certainty and equity. Most agreements include provisions for the timely payment of portions of the total fee as services progress.The amounts and disbursement schedule are determined by: ¢Effort expended and costs incurred during an appropriate time interval (typically one month); *Completion of design phases or project milestones as described in the agreement; *Estimated partial completion of lump sum-related services,as estimated by the design professional and approved by the owner. Fees (and their terms of payment)can occasionally generate misunderstand- ings.The owner and design professional should discuss contract payment pro- visions thoroughly and tailor the terms to the project circumstances. 7.2.4 Owner's Responsibilities Overall project quality is closely related to the owner's willingness to be responsible for the timely and satisfactory performance of his or her respon- sibilities and associated tasks.These responsibilities and tasks,which are 57 >Chapter 2,"The Owner's Role and Requirements” Standard Forms for Contract Amendment EJCDC Doc.E-501 Amendment to Owner- Engineer Agreement EJCDC Doc.E-571 Amendment to Engineer- Consultant Agreement identified during negotiations with the design professional and then incorpo- rated into the agreement,typically include: ¢Defining the project objectives and,if appropriate,quantifying the required capabilities; ¢Providing adequate project financing; ¢Providing existing information on the project and related site conditions; ¢Arranging to obtain specialized design information,such as field surveys and subsurface investigations; ¢Making decisions promptly; *Coordinating activities with other project team members; ¢Arranging for permits and approvals from regulatory agencies; «Paying earned fees to the design professional promptly; ¢«Communicating clearly and in a timely manner; ¢Maintaining required project records; ¢Dictating or approving the terms of the construction contract; ¢Specifying insurance requirements; ¢Carrying out other activities necessary for the design professional's per- formance; ¢Related auditing of expenditures as required. 7.2.5 Procedures to Amend the Agreement Changes to the design professional's activities,schedule and/or compensa- tion are common on most construction projects.Therefore,projects proceed more smoothly when the professional services agreement includes procedures for changing the scope of services.These procedures are typically included in the terms and conditions section of the agreement.Such changes are made in writing and approved by duly authorized representatives of the parties to the agreement. Common sense procedures for the owner's authorization of amendments can help prevent disputes and delays.Provisions requiring prior top-level approval for each change may conflict with normal working procedures,especially in cases where quick scope changes will improve the project or the owner's representative exercises control of the scope.An owner governed by a group or board will benefit by delegating authority for certain types or sizes of con- tract changes to a knowledgeable representative.This representative works to protect the owner's interest,but also expeditiously authorizes changes with- out breaching the agreement or causing delays.Owners with tiered authority may grant authority to the chief executive for contract amendments with large dollar or schedule impacts,while successively lower level administrators may approve smaller changes.Other owners often approve an initial amount equal to the anticipated costs plus a contingency and allow the owner's project man- ager to authorize changes as necessary,as long as the modified cost,scope, and schedule remain within the initial authorization.In any event,the owner's procedures affect the design professional's ability to continue during the proj- ect,and the agreement should be consistent with the actual procedures. 58 7.2.6 Other Provisions Other typical items in the agreement for professional services include: ¢Duration of the agreement; ¢Termination of agreement; ¢Authority and responsibilities of parties'designated representatives; ¢Ownership and reuse of documents; ¢Insurance to be carried by the design professional and by the owner; *Confidentiality,publicity,and rights of transmission to others; ¢Limits of liability; *Methods of dispute resolution; ¢Assignment,beneficiaries,and severability of the agreement; *The legal jurisdiction whose laws apply to the agreement; ¢An identification of the general conditions to be incorporated in the con- struction contract that the design professional will administer to help avoid conflict or ambiguity with the design agreement. 7.3 STANDARD-FORM AGREEMENTS Although agreements for professional services are structured for the project at hand,the use of standardized contract language and provisions provides benefits in fashioning the agreement.Standard-form agreements offer provi- sions that reflect accepted industry practices,using language that has been tested in court.Standard-form agreements help the owner and designer allo- cate risk fairly and set fair terms of compensation as well as reduce the time spent drafting and negotiating the agreement itself. The following sections provide a brief review of the standard-form agree- ments available from professional associations,government agencies,and pri- vate organizations. 7.3.1 Professional Societies and Associations The leading professional societies comprising the EJCDC produce standard- form agreements for professional services for use by owners and design pro- fessionals as does the American Institute of Architects (AIA).These associations also produce complementary subcontracts,commentaries,bid- ding and construction contract forms,and related documents. 7.3.2 Government Agencies Many government agencies at the federal,state,and local levels have their own standard service agreements that incorporate their legal constraints and contracting policies as public project owners.Design professionals benefit from reviewing carefully the terms of such contracts,which sometimes resem- ble contracts for the purchase of goods or construction services and can include provisions that are inappropriate for professional services.In general, the standard-form agreements of public agencies that are the most experienced 59 Sources for Standard-Form Agreements ain EJCDC:www.pubs.asce.org/contract.html ain American Institute ofArchitects:www. e-architect.com/resources ty U.S.Rural Utilities ServiceStandardFormofAgreement Between Owner and Engineer for Professional Services,Funding Agency Edition:www.usda.gov/rus EJCDC Doc.E-505:Standard Form of Master Agreement between Owner and Engineer for Professional Services in contracting with design professionals are more helpful in developing pro- fessional service agreements. 7.3.3 Owners,Design Professionals,and Constructors Private organizations that frequently prepare contracts for professional serv- ices may develop their own standard-form agreements.In general,these stan- dard agreements are developed unilaterally by the party tendering the agreement.Careful review of the form,contract language,and contract terms is necessary to adapt the agreement for design services to the unique goals and objectives of the project and to provide equitable treatment of both con- tracting parties.EJCDC and AIA standard forms provide a good basis of comparison. 7.4 SHORT-FORM AGREEMENTS If a project is routine or relatively small and simple,a well-drafted short-form agreement for professional services may be appropriate.Short-form agree- ments can be: ¢A letter of understanding-often proposed by one party and counter- signed by the other-outlining the essential elements of the agreement; *A short-form professional services agreement proposed by either party with preprinted contract terms. The potential time saving benefit of short-form agreements is appealing.But short-form agreements may be incomplete in their project definitions and may fail to generate mutual understanding between the parties.The use of short forms can be hazardous to both parties if the documents were modeled after contracts originally intended for other purposes. For example,industrial purchase orders,which are used for procuring goods or minor construction,might seem to simplify contract formation.But pur- chase orders probably include superfluous language about shipping details or acceptance testing.They typically contain Uniform Commercial Code- based provisions relating to guarantees and indemnification that are not appro- priate for a design services agreement.The design professional's errors and omissions insurance may not cover such clauses,and such language may be less advantageous to the owner than conventional terms and conditions. Owners and designers who contemplate several similar projects can obtain advantages of short-form agreements by negotiating a single "master agree- ment.”Such agreements outline the division of responsibilities,terms and conditions,general compensation matters,and other items that apply to all projects between the two parties during a specified period of time.The paper- work describing the scope,schedule,fee,and unique owner's responsibili- ties for each individual project under the master agreement is commonly known as a "task order.” 60 7.5 OTHER DESIGN CONTRACTS The design of a constructed project may involve other contractual relation- ships in addition to the prime agreement between an owner and the principal design professional.Whether a project follows the design-bid-build sequence or that of another delivery system,additional contracts also require thorough negotiation and documentation. The following sections discuss additional types of agreements involving the design professional. 7.5.1 Subconsultant Agreements When comprehensive design services are required on a project,the prime design professional often contracts with subconsultants.The EJCDC,ATA, and other professional groups publish standard subcontract forms that assist in negotiating and writing clear agreements with design team subconsultants. For instance,the Council of American Structural Engineers (CASE),a struc- tural consultant group within the American Consulting Engineers Council (ACEC),publishes a series of standard documents,including subcontract forms. A key advantage of using standard professional society documents is that the language and provisions are consistent among the several contracts necessary for the project.All EJCDC and AJA documents are thus coordinated and grouped into related "families”of documents for alternate methods of proj- ect delivery.(It is preferable not to mix EJCDC and AIA documents on one project.) 7.5.2 Multi-Prime Agreements Some owners prefer to contract directly with specialty designers to achieve greater control over the design process and reduce the prime designer's fee.The exploration of subsurface conditions and the analysis of the findings by a geot- echnical engineer is one service for which owners often contract directly.The owner thus can directly balance his higher costs of more extensive soil inves- tigations with the lessening of potential subsurface surprises.Other specialty design professionals may be advantageous where their services do not impact the main design,perhaps due to separations of space or time.An owner may prefer contractual independence from the prime design professional,as with project peer reviews (see Chapter 22)or value engineering (see Chapter 25). Less frequently,owners may contract directly with all specialists for a proj- ect under an arrangement known as "multi-prime”contracting.In either case, the owner has the opportunity to enhance quality by tailoring the relation- ship with each design professional to meet the project objectives,rather than relying on fixed standards.However,with more parties,the owner faces loss of sole source responsibility,increased administrative complexity,and cost of coordination with the added required interactions. 61 Subconsultant Standard Forms of Agreement EJCDC Doc.1910-10 (future E-568)Standard Form of Agreement Between Engineer and Architect EL}EJCDC Doc.1910-14 (future E-570)Standard Form of Agreement Between Engineer and Consultant LED EJCDC Doc.1910-27-B (future:E-564)Standard Form of Agreement Between Engineer and Geotechnical Engineer ELI AIA Form C141 Standard Form of Agreement Between Architect and Consultant Additional Standard Form Agreements EJCDC Doc.1910-27-A (future:E-530)Standard Form of Agreement between Owner and Geotechnical Engineer for Professional Services (EY EJCDC Doc.E-581 Standard Form of Agreement Between Owner's Designer and Project Peer Reviewers for Professional Services for Independent Project Peer Review EJCDC Doc.1910-30 (future: E-540)Coordinated Multi- Prime Design Agreement Between Owner and Design Professional for Construction Projects=Wt Standard Forms for Design and CM AIA Form B141/CMa aa) wy) > Agreement Between Owner and Architect,Construction Manager-Adviser Edition AIA Form B144/ARCH-CM: Amendment to the Agreement Between Owner and Architect (with architect in advisory role as construc- tion manager) Construction Management Association of America "A” series standard forms Construction Manager as Owner's Agent;"GMP”series standard forms Construction Manager for Guaranteed Maximum Price Construction Management Association of America: www.cmaanet.org 3.3,"Construction Management” AJA and EJCDC forms are excellent guides for owners seeking to engage design specialists directly.In addition,EJCDC Doc.1910-30 is written specif- ically for owners who wish to contract directly for all specialty services nor- mally performed as subcontracts to the prime design professional. 7.5.3 Construction Management Contracts In the construction management method of project delivery,the role of the design professional depends on the agreement between the owner and the con- struction manager (the "CM”).Because there are many different construction management methods,contracts that clearly define relationships and respon- sibilities of all parties are necessary for project quality.In some cases,a CM may act as a member of the owner's staff,perhaps even preceding the selec- tion and engagement of the design professional team.The status of this type of construction manager as an intermediary or representative of the owner in dealing with the design professional is formalized subsequently in the pro- fessional service agreement.This so-called Agency CM is in a contractual position between the owner and the design professional. Another contract alternative,sometimes known as a "Construction-Manager- at-Risk,”involves the hiring of a firm that could act as a general contractor or could oversee a large number of construction craft trades each having sep- arate agreements with the owner.The resulting relationships between owner, CM,and constructors are incorporated in detail in the construction contracts. The design professional agreement specifying the designer's related role and responsibilities should,as always,reference the intended construction respon- sibilities,should be consistent in its description of the design professional's role under the intended CM-at-Risk plan,and should be modified if the roles of the participants are revised at any time. EJCDC does not publish construction management forms.AIA offers a "CM- Adviser”(CMa)and a "CM-Constructor”(CMc)family of forms that may be applicable to some engineering projects with considerable care as to the selection of the appropriate set of forms.Firms offering CM services may provide standard forms for engaging designers. 7.5.4 Design-Build,Turnkey,and Developer-Financed Contracts A design-build project can require two distinct roles of design professionals. The owner might engage a design team to help define the project goals and assemble the design-build procurement package.This design professional can also help the owner evaluate technical proposals and the performance of the design-builder. Whether or not the above role is filled,there is always a role for the design professional who performs the actual design of a design-build project.This designer-of-record might be an in-house employee or department of the design-build firm or a consultant working for the design-builder. 62 Design-build projects are usually carried out at a faster pace than those under the traditional design-bid-build system.Therefore,quality in a design-build project depends in even larger measure on the owner's commitment to pro- vide sufficient time to formulate,analyze,discuss,and record all the agree- ments between the parties.With rapidly emerging variations in design-build project delivery systems and similar departures from the design-bid-build approach,there are fewer fixed rules,assumptions,and accepted conventions for the owner and design-build contractor.Therefore,each participant in a design-build project will benefit from making an extra effort to clarify responsibilities. Four sets of design-build contract forms that are valuable in forming contracts for design professionals on such projects are noted below: 1.EJCDC provides the most complete series,with forms of agreement between the owner and the "Owner's Consultant,”as well as between the design-build firm and its design professional. 2.AIA publishes several regular forms that may be suitable for use in design-build contracting by a designer engaged by the owner to prepare what the AIA terms "bridging”documents.AIA form B901 is for an architect contracting with a design-builder.These forms may also be appropriate on some engineering projects. 3.AGC series 400 forms deal with design-build projects,and AGC Form 420 covers the contract between the design-build constructor and the designer. 4.The Design-Build Institute of America (DBIA)series 500 publications are standard form agreements for a variety of contracting arrangements that may be of benefit to the design professional. Turnkey or developer-financed methods of project delivery are unique to each project.The parties will have legal counsel heavily involved in drafting each of these agreements,and no industry standard forms exist. 7.6 CAUTIONS CONCERNING NON-TRADITIONAL CONTRACTING RELATIONSHIPS The large variety of types of contracting arrangements for design services provides the owner and design professional with unprecedented flexibility in selecting an appropriate contractual relationship for the project at hand. However,this variety can also create confusion,as it tends to change the tra- ditional relationships in far-reaching and possibly unintended ways,perhaps leading to the inadvertent use of inappropriate language or forms. Two other types of documents may also be of benefit to owners and design professionals:joint venture agreements and partnering documents.These are described below in this "Cautions”section because they are not part of the owner-design professional agreement and should not be permitted to cloud that agreement by any inconsistency therewith. 63 Design-Build Standard-Form Agreements EJCDC Doc.1910-41 (future ey D-505)Subagreement Between Design-Builder and Engineer for Design Professional Services LW EJCDC Doc.1910-43 (future: D-500)Agreement Between Owner and Owners Consultant for Design Professional Services on Design-Build Projects AIA Form B901 Agreement Between Design-Builder and Architect |AIA Form 420 Agreement Between Contractor and Architect/Engineer for Design-Build Projects Associated General Contractors:www.agc.org Design-Build Institute of America:www.dbia.org Joint Venture Standard-Form Agreements EJCDC Doc.E-580 Standard Form of Joint Venture between Engineers for Professional Services AIA Form C801 Joint Venture Agreement for Professional Services >Chapter 24,"Partnering” 7.6.1 Joint Venture Agreements Most design services are rendered as a result of a contract between the owner and the prime design professional,who then may subcontract with other firms for specific design tasks.But in some instances,the design professionals col- laborate in a formal joint venture arrangement with each other.Such entities, which are governed by internal joint venture agreements for each project,then contract with the owner.It is common for the joint venture to take the form of a Limited Liability Company.Such LLCs limit the vicarious liability oth- erwise present in joint ventures,which are otherwise legally considered a partnership. A joint venture agreement between design firms is a business arrangement and not a professional services agreement.As a service to engineers who wish to form joint venture relationships,EJCDC and AIA provide standard joint venture agreements.These standard forms should be tailored to the specific project and reviewed by legal experts familiar with local business laws. 7.6.2 Partnering Agreements Partnering is a management process through which members of a project team agree to cooperate and respect each others'roles.While partnering can be a valuable strategy in enhancing project quality,it does not constitute a busi- ness partnership or a binding agreement.Partnering agreements (perhaps bet- ter termed "charters”to eliminate connotations of legal standing)establish goals and guidelines for project communication and conflict resolution;they are not formal contracts or related documents that establish legal responsi- bilities.Partnering documents,and the actions of those who partner,are intended to complement the binding terms and conditions of the professional services agreement. SUMMARY Professional agreements for design services take many different forms,reflect- ing the profusion of new organizational arrangements of project teams.For traditional project delivery methods,excellent standard forms prepared by knowledgeable professional associations and organizations and by the most experienced owners offer reliable industry contracting conventions.Some owners may prefer to negotiate professional service agreements that provide them with additional direct control,while other owners prefer the opposite- delegating a larger portion of their traditional functions to the design profes- sional or design-build contractor.For all project delivery systems,sound contracting procedures for professional design services are important to the quality of the constructed project.O 64 Chapter 7:Agreement for Professional Services Typical Responsibilities Responsibility Design Design- UG Owner Professional Constructor Builder Determine the form of the @ ©© professional services agreement (prime-only,prime-with-subconsultants, multiple-prime) Decide if short-form or standard-form e@ ©© agreement(s)are to be used Conduct pre-contract negotiations e@ e @ Develop and review scope/schedule/e@ r @ fee sections of agreement Develop and review agreement e@ e@ e Provide adequate time for contract e e@ e review and revision Contract with and manage design e @ e subconsultants Coordinate agreement with Construction ©r ©e Management responsibilities Project delivery methods involving construction managers (CM)are not included,due to the wide variation of possible contractual relationships.See 3.3,"Construction Management,”for a summary of CM relationships. @ =Primary Responsibility @ =Assist or Advise ©=Review 65 CHAPTER 3 ALTERNATIVE STUDIES AND PROJECT IMPACTS Mi:construction projects typically involve the development and studyofseveralalternatives.The evaluation of alternatives requires the coop- erative efforts of the owner,design professional,constructor (if available), regulatory agencies,and often the public. The study of alternatives and evaluation of their impacts can vary greatly, depending on the size and complexity of the project.Large complex proj- ects,which usually require significant resources to study alternatives and impacts,benefit from a structured-and often agency-mandated-program of investigation.Small projects may use a more informal approach to the alter- natives study process,but the process still involves a host of decisions,includ- ing those related to site selection,schedule,materials,and equipment. Whatever a project's size or complexity,the project team can improve over- all quality by following a systematic process to identify,screen,refine,and select alternatives.Such an approach is virtually a necessity on projects that are subject to federal,state,or local laws that require extensive project impact analysis,documentation,and reporting. Using a systematic process to develop and select alternatives also helps the project team imagine how people with other perspectives may respond to the proposed project.This is an important aspect of project development,as dras- tic revisions to accommodate concerns raised during final design or con- struction are typically more costly and take Jonger than those raised during conceptual development and preliminary design. Figure 8-1 summarizes the general steps in a systematic process of studying project alternatives and evaluating associated impacts.These steps provide the project team with a structured approach,yet one that offers sufficient flex- ibility in tailoring the team's efforts to adequately study alternatives,deter- mine impacts,and make informed decisions.These steps are: Project Conceptualization; Existing Conditions and Future Needs Analysis; Framework for Developing Conceptual Alternatives; Selection of a Preferred Conceptual Alternative.Pwnr67 In this chapter 8.1 8.2 83 8.4 8.5 8.6 Project Conceptualization Existing Conditions and Future Needs Analysis A Framework for Developing Conceptual Alternatives Investigating and Selecting Conceptual Alternatives 8.4.1 Phase 1:Fatal Flaw Screening 8.4.2 Phase 2:Qualitative Assessment and Comparison of Conceptual Alternatives 8.4.3 Phase 3:Quantitative Comparison of Conceptual Alternatives 8.4.4 Phase 4:Selection of a Preferred Conceptual Alternative Environmental Documentation and Permitting 8.5.1 Types of Environmental Impacts 8.5.2 Permits 8.5.3 Documentation Public Involvement Figure 8-1 Alternatives Study and Impact Analysis Process STEP 1 Project Conceptualization *Define project ¢Define owner's goals and objectives *Define expectations of other stakeholders ¢Define constraints STEP 2 Existing Conditions and Future Needs Analysis *{dentify indicators ¢Define existing conditions Identify future needs *Consider "no-build" ¢Analyze future needs STEP 3 Framework for Developing Conceptual Alternatives ¢Address deficiencies ¢Respond to goals and objectives ¢Acknowledge constraints ¢Address pre-established - STEP 4° Investigating and Selecting Conceptual Alternatives ¢Fatal Flaw Screening *Qualitative Assessment and Comparison of Conceptual Alternatives *Quantitative Comparison of arrangements Conceptual Alternatives *Selection of Preferred Conceptual Alternative =.ent ea i ae = "See Figure 8.2 >972.3,"Associate Consultants” 8.1 PROJECT CONCEPTUALIZATION The project team begins the systematic process of studying alternatives and impacts with conceptualization.It is critical that the project team develops a clear statement and understanding of why the project is needed.During this step,the owner and design professional (or planning consultant or design- build contractor)establish as the topics for study,the extent of proposed inves- tigations,the level of effort to be expended,reports to be submitted,and the decision-making process.Typical questions that the project team considers at this point include: ¢Do all parties understand and support the owner's goals and objectives? ¢What are the expectations of the owner,design professional,construc- tor,regulatory agencies,and the public? ¢Are there unique or compelling opportunities or constraints that will influence design and construction? «What agency-required documents,approvals,or permits are needed? ¢Are there project constraints related to cost and schedule,physical size, or impacts? The answers to these questions aid the team in prioritizing their activities dur- ing conceptualization.This information also assists individual members of the project team in defining their own roles,deciding what types of associ- ate consultants may be necessary,and determining the extent of public and agency involvement. 8.2 EXISTING CONDITIONS AND FUTURE NEEDS ANALYSIS The project team's understanding of existing conditions and likely future needs is the basis for the development of conceptual alternatives.This infor- mation is crucial for presenting the potential benefits and consequences of project alternatives to others involved in the planning process,including fel- low team members,agency officials,and the general public. 68 The project team's selection of relevant indicators of existing conditions and future needs aids in determining the source of future facility demands,poten- tial shortcomings,or new opportunities.The project team also determines what aspects of existing facilities,such as safety,capacity,operating effi- ciency,or maintenance limitations,could be modified or what type of new facilities would achieve the owner's goals and objectives. Documenting existing conditions is necessary to provide a set of baseline con- ditions for assessing impacts.It is particularly important to record informa- tion that is related to the relevant indicators noted above,as well as environmental conditions. The project team's assessment of future needs is crucial in establishing a no- action,or "no-build,”alternative that estimates the impacts on existing and related facilities if the proposed project is not built.The no-build alternative serves as a baseline against which "build”alternatives are compared.This analysis often provides vivid examples of a project's potential benefits and further aids the project team in developing alternatives. In some cases,the analysis of future needs involves issues that are not directly related to the existing or proposed facility itself.These may include changes in regulatory policy,land use,transportation systems,environmental protec- tion regulations,pending legislation,or forecasts of changes in demand. 8.3 A FRAMEWORK FOR DEVELOPING CONCEPTUAL ALTERNATIVES After developing an understanding of existing and future conditions,the proj- ect team begins forming a framework for developing conceptual alternatives. This framework includes basic planning and design guidelines,policy guide- lines,user preferences,public attitudes,environmental regulations,sustain- able development issues,and other criteria.On public projects,the team should solicit agency and public involvement in forming the framework;on private projects,the owner may seek input from those who will use,manage, and maintain the facility,as well as public involvement. Conceptual alternatives,by their nature,are broad and developed only to a level of detail that provides an understanding of their potential ability to address the owner's goals and objectives.Typical conceptual alternatives will include variations on a facility site and footprint,generic structure types,alter- native modes of transportation,and generic construction materials and tech- niques. At a minimum,a framework for developing conceptual alternatives should include the following considerations: *Deficiencies in existing facilities and/or the need for new facilities; ¢Responsiveness to the owner's goals and objectives; ¢Acknowledgments of constraints related to applicable public policies, zoning restrictions,land uses,permits,financial resources,and laws; 69 Common Indicators of Current and Future Conditions ©Traffic ©Air quality ¢Noise levels ©Water quality e Aesthetic and historic impacts ¢Number of users ©Overhead or operating costs ¢Production rates ¢Energy utilization ©Employment and economic impacts The team applies increasing analysis and scrutiny to the alternatives as the process proceeds. *Addressing of pre-established arrangements among participants and affected parties; ¢Analysis of functional efficiency,technical accuracy,cost effectiveness, reasonable constructability,ample safety measures,environmental pro- priety,sustainability,and aesthetic elegance. The development of conceptual alternatives is a collaborative process involv- ing many participants and iterations of concepts.The process benefits from group brainstorming and a wide range of input,as well as individual efforts. Different organizations take different approaches to developing alternatives, depending on their professional strengths and experience.The appropriate number of alternatives can vary widely.Some projects can be investigated sufficiently with just one alternative (the no-action),while other projects may involve dozens of alternatives. Given these variations,the constants for ensuring quality during the devel- opment of conceptual alternatives are:promoting good communication and coordination among participants;developing clear definitions of critical per- formance measures and evaluation criteria;and involving the public in the conceptual development phase to enhance the acceptance of the planning process. 8.4 INVESTIGATING AND SELECTING CONCEPTUAL ALTERNATIVES As new alternatives are formulated,the project team examines the merits and shortcomings of each,moving toward the selection of alternatives that merit more extensive analysis.Therefore,the selection of alternatives that meet the project objectives depends on the team's success in defining and forming a consensus on the evaluation criteria. Figure 8-2 describes the investigation and selection of conceptual alternatives in four general phases: 1.Fatal Flaw Screening 2.Qualitative Assessment and Comparison of Conceptual Alternatives 3.Quantitative Comparison of Conceptual Alternatives 4.Selection of a Preferred Conceptual Alternative As the project team proceeds through these phases,increasing analysis and scrutiny is applied to the alternatives.As a practical matter,the detailed inves- tigation of every possible alternative is neither cost effective nor productive. Therefore,discarding those alternatives with less promise early on helps ensure that the team can focus project resources on the engineering,envi- ronmental,and cost evaluations for the most viable alternatives.During this process,the team also identifies and incorporates improvements to the alter- natives under consideration. 70 Figure 8-2 Investigation and Selection of Conceptual Alternatives Existing Conditions PHASE 1 PHASE 2 PHASE 3 Fatal Flaw Qualitative Assessment Quantitative Screening and Comparison of Comparison of Conceptual Alternatives Conceptual Alternatives Future Needs Decreasing number of alternatives PHASE 4 Selection of aPreferredConceptual aAlternative Increasing level of engineering detail Construction 8.4.1 Phase 1:Fatal Flaw Screening During the first phase of alternatives investigation,the project team applies a fatal flaw screening to the conceptual alternatives developed.This allows the project team to discard those that are unfeasible or undesirable with respect to the owner's goals and objectives. During fatal flaw screening,the team gets a better sense of the types and num- ber of alternatives that merit further examination,as well as the extent of the planning and design effort necessary to carry out the evaluations competently. Fatal flaws may be the result of resource limitations,regulatory requirements, environmental protection laws,public or worker safety laws,technical limi- tations,owner preferences,or other factors. On public projects,is it recommended that the project team clearly docu- ment and inform the public about how and why certain alternatives are dis- carded.This is important to minimize the impact of future legal disputes by citizens and/or affected parties. 8.4.2 Phase 2:Qualitative Assessment and Comparison of Conceptual Alternatives In the second phase,the project team develops more refined engineering infor- mation for the surviving alternatives.The scope of study and effort vary con- siderably with each project,but in most cases the level of engineering detail is still considered "conceptual”and does not approach the generally accepted completion threshold for "preliminary”engineering of 10 percent. While the project team continues to compile more information on the alter- natives,Phase 2 evaluations tend to remain qualitative in nature.Ideally,the 71 Sustainable Development:The consideration of sustainable devel- opment impacts-the environmen- tal and societal effects of natural resource depletion and waste man- agement-are integral to any con- structed project. thy U.S.Department of Energy:www.sustainable.doe.gov hy U.S.Green Building Council:www.usgbc.org dy Environmental BuildingNews:www.ebuild.com dy U.S.EPA ResourceConservationandRecovery Act (RCRA): www.epa.gov/rcraonline alternatives investigated will provide the project team with a range of information,including potential project performance,schedule,aesthetic appearance,life-cycle costs,cost-benefit ratios,sustainable development ele- ments used,socioeconomic benefits,and environmental impacts.Though most of these measures are identified during early project planning,changes dur- ing this phase of alternatives investigation are not uncommon.Therefore,the owner and design professional benefit from incorporating enough flexibility in the scope and terms of their contractual agreement to allow them to adapt to changing conditions. Project alternatives may vary widely in type and complexity.In general,alter- native studies involve exploring the impact of manipulating variables that are significant to the project.The significance of variables is different for each project;for example,the impact of schedule variations is apt to be less criti- cal on small,private projects than on major commercial or public endeavors. Alternative Type 2#ii2au@maues Phase 2 Study Variables resxneaseny Scheduling *Compressed schedules,which can be an advantage in short construction seasons. ¢Time value of money in relation to bringing a commercial enterprise into service. *Construction schedules required by regulatory authorities to address environmental concerns that may range from mitigating traffic congestion to protecting the breeding and migration of sensitive species. Alternate Concepts or ¢Site locations and configurations. Layouts ¢Alignments within a transportation or utility corridor. ¢Drainage methods. *Structural systems and materials. ¢Construction methods. Construction Phasing ¢Completion of the project in phases so portions of the facility can begin generating revenue sooner. ¢Spreading out construction activities over a longer period to reduce the magnitude of their impact on abutters or the environment. Minimum Build *Exploration of the minimum amount of con- structed improvements that could be undertaken (though such strategies typically involve a degree of compromise in the project goals). No-build ¢A default study inherent with every project that helps answer the question,"What happens if we don't build this project?” 72 In Phases |and 2,costs are typically expressed as "order of magnitude”esti- mates based on the costs of similar engineering and construction projects. Detailed cost estimates cannot be provided during this phase,as their devel- opment requires detailed engineering data-most of which has yet to be devel- oped.Therefore,during the study of conceptual alternatives it is important that the project team focus on the relatively large differences in cost rather than small ones. Though qualitative,Phase 2 analysis is closely tied to the evaluation criteria and target performance measures established previously by the project team. Depending on the potential of the alternatives to meet project needs,the proj- ect team selects the alternatives to be carried forward to Phase 3. 8.4.3 Phase 3:Quantitative Comparison of Conceptual Alternatives In Phase 3,the project team performs engineering analyses on the remaining conceptual alternatives to a level sufficient to assure that the elements can function.This degree of engineering detail also provides information for the quantitative assessment of each alternative and its consistency with estab- lished criteria and performance measures. Examples of items that may be analyzed in Phase 3 are shown below: 3323.Functional Alternatives 333204 t%¢Cost Alternatives Raseee ¢Materials handling methods ¢Design cost ¢Traffic flow arrangements (patterns ¢Capital cost of construction in air,water,land,people,or *Operation and maintenance costsproducts)*Life-expectancy or design-life*Types of travel modes (vehicle type,periodssize,style) ; ¢Return on investment *Methods to provide fish passage at ar ¢Project phasing (initial opening orbarriersinwaterwaysJee"P g (P 8 operating segments)°ace allocations .Sp ¢Extra cost for aesthetics ¢Clear-span requirements in buildings .P 4 g ¢Cost/benefit ratios *Public/private (joint development) options *Methods to avoid or minimize impacts to the natural environment The project team develops quantitative data (based on more detailed engi- neering)on such features as utilities,construction costs,rights-of-way,aes- thetics,environmental and sustainable development compatibility and impacts, technical feasibility,constructability,construction sequencing,phased imple- mentation,and risk. Cost estimates for the conceptual alternatives during Phase 3 are refined from those developed earlier to reflect the more detailed information available on 73 quantities of materials,construction methods,and schedule.However,a host of variables remain to be considered before the project team can develop a more realistic cost estimate.These variables include labor and material costs, the competitive climate among constructors in the local market,site condi- tions,the final scope of the project,and the schedule (including potential proj- ect phasing).Therefore,the evaluation of cost during Phase 3 remains focused on the relative differences among the conceptual alternatives. Ordinal ranking can be a useful tool in Phase 3 conceptual alternative evalu- ations.In ordinal ranking (Figure 8-3),the project team develops a weighted numerical value system with categories that reflect key aspects of the owner's goals and objectives.For example,on a project to reconstruct and expand an existing interchange,construction sequencing and maintaining traffic during reconstruction may be more critical than the amount of property to be acquired.The project team makes a quantitative comparison of the alterna- tives and assigns a numerical rank within the established range and weight- ing system for each category to each alternative.Ordinal ranking is a blend of qualitative and quantitative techniques,and while helpful,its value depends highly on the positive correlation of the ranking categories and the owner's goals and objectives. 8.4.4 Phase 4:Selection of a Preferred Conceptual Alternative Engineering evaluation is a crucial,but not the only,factor in the selection of a preferred alternative.Community and agency involvement programs,envi- ronmental impacts and mitigation measures,and public policy may influ- ence the alternatives considered,as well as the selection of a preferred alternative. Figure 8-3 Ordinal Ranking Example Scale Relative Rating/Value j Comparison Considerations Value Alternative 1 Alternative 2 Alternative 3 (3 to 30)Rating |Unit |Rating Unit |Rating |Unit(3 to 10)|Value |(3 to 10)|Value |(3to 10)|Value Traffic Operations/Safely 10 3 30 5 50 10 100 Phased Implementation Expandability 10 5 50 10 100 6 60 Environmental and Community Impacts 5 10 50 4 20 8 40 Constructability 5 4 20 6 30 10 50 Construction Costs 5 3 15 6 30 10 50 Right-of-way Requirments 10 10 100 4 40 6 60 Compatibility with Public Transportation 10 10 100 3 30 4 40 Compatibility with Pedestrians/Bikes 5 5 25 10 50 8 40 Local Access and Circulation 15 8 120 6 390 10 150 Satisfies Operational &Design Requirements 10 10 100 3 30 5 50 Compatibility with Other Elements 10 7 70 10 100 5 50 Funding Feasibility 5 3 15 10 50 4 20 Total Scale Value 100 Total (Index Value}695 620 710 74 In general,the preferred alternative is the one that best balances competing objectives of the stakeholders in the project.The project team's functional evaluation of alternatives during Phase 3 provides the basis for their recom- mendation of a preferred alternative. In the end,no matter how closely the members of the project team may have worked during the preceding three levels,the principal activity of Phase 4- selecting a preferred alternative-is the responsibility of the owner (or lead regulatory agency if a permit or federal funding is involved).In some cases, the owner may present two or more alternatives to a public agency,such as a metropolitan planning organization,for final selection. Following adoption of a preferred conceptual alternative,the project team begins developing preliminary and final design drawings,specifications,a construction schedule,and an opinion of probable construction cost. 8.5 ENVIRONMENTAL DOCUMENTATION AND PERMITTING The study of project alternatives and impacts is often closely tied to envi- ronmental documentation and permitting processes regulated by government agencies.Agency environmental regulations can consume a significant por- tion of the project team's effort during the study and evaluation of alterna- tives.Since 1969,when the U.S.Congress passed the National Environmental Policy Act (NEPA),public awareness and interest in the environment has increased.The act also sparked new sensitivities about the potential impacts of constructed projects.Environmental documentation and permitting processes are an important means of demonstrating potential project impacts and compliance with environmental law. 8.5.1 Types of Environmental Impacts Every constructed project affects its surrounding environment in some way. It is critical that the project team adhere meticulously to prescribed environ- mental evaluation processes;flaws in legally mandated environmental reviews can be the subject of litigation that can slow or derail a project.When devel- oping alternatives,the owner and design professional need to address a wide range of environmental considerations,including impacts on: *Wetlands and water quality; ¢Aquatic and wildlife resources; ¢Farmlands; ¢Human health; «Scenic vistas; *Navigable waterways; ¢Natural streams or bodies of water; ¢Natural vegetation,including forests; ¢Cultural resources,including historic and archaeological features; *Topographic features; 75 More than a dozen laws form the basis of the U.S.Environmental Protection Agency's programs. ty www.epa.gov/epahome/laws Federal Environmental Impact Procedures,Code of Federal Regulations (CFR)Part 771 £0)National Environmental Policy Act (NEPA)planning guidelines,40 CFR Chapter 5 Environmental Justice: Assessing impacts on minority and low-income populations Executive Orders 12898 and 12843 (1994) Types of Permits (partial list) ©Federal-u.S.Army Corps of Engineers Section 404, Section 4(f) ©State-Access permits to state highways ©Local-Planning and zoning approvals for development and design review Types of Environmental Documentation (partial list) e Environmental Assessments (EA) ©Environmental Impact Statements (EIS) e Federal and state historical and preservation clearances ©Cultural resource clearances ¢Threatened and endangered species studies ¢Traffic congestion; ¢Air quality; ¢Noise and vibration; *Waste management (including materials recycling and reuse). Socioeconomic conditions are also considered part of the environment by many regulatory agencies.Therefore,the project team benefits by perform- ing an evaluation of project impacts on the fabric of the community.These issues may include: ¢Residential or business displacements; *Effects on property values and/or business vitality; ¢The quality of life during and after construction in nearby residential neighborhoods and public/private institutions; ¢The potential for disproportionate negative impacts on low-income or ethnic communities; *Sustainable development concerns. 8.5.2 Permits The project team is often required by federal,state,and local agencies to demonstrate the ability to mitigate potential environmental impacts during the process of obtaining the permits that are required before the start of con- struction.In addition to routine building and occupancy permits,some fed- eral,state,or local permits or approvals may be required that are specifically related to the project's impact on the surrounding environment. Before granting permits,agencies usually require the owner to submit docu- mentation showing that potential environmental impacts have been evaluated and that appropriate measures to control and mitigate adverse effects will be implemented during construction and operation.Therefore,the project team benefits from involving permitting agencies in the project as early as possi- ble to gain a full understanding of permitting procedures. 8.5.3 Documentation Many states have specific environmental regulations that specify the type of documentation necessary to evaluate a proposed project's impacts.Most state environmental regulations have been promulgated since passage of NEPA and adopt a similar approach to environmental evaluation. When owners understand that some projects or alternatives may be subjected to a potentially extensive federal,state,and local agency approval process, they can develop an appropriate approach to project-specific alternative stud- ies.Early and active consideration of these matters by the owner,design pro- fessional,and other advisers can help determine what federal,state,or local laws and regulations apply to the proposed project.Once this is determined, the project team can identify the appropriate reviewing agencies and develop a strategy for providing the information these groups need to review and approve the project. 76 8.6 PUBLIC INVOLVEMENT The coordination of public involvement with the alternatives study process is an essential-and often legally required-component of constructed projects. Public involvement may range from informal one-on-one meetings with peo- ple affected by construction,to extensive programs that involve workshops, open houses,public hearings,and media relations. The project team benefits from determining overall public involvement needs early in the planning process,usually as the project goals are taking shape. The guidelines for producing federal and state environmental documentation address public participation,such as hearings and other outreach activities, plus agency review and comments. Agencies,elected officials,planning and zoning boards,commissions,and quasi-public authorities can wield considerable influence in project-related environmental decisions.Team members can make a considerable contribu- tion to project quality by informing these parties early and regularly about proj- ect developments.Even if there are few new developments,regular updates demonstrate to the community the project team's commitment to quality. Public involvement is tailored to meet the participation needs of the project as it progresses.During the planning process,public involvement efforts tend to focus on building a consensus and obtaining the necessary approval to begin design and construction.Later,when construction actually begins,public con- cerns tend to turn toward traffic and environmental impacts in the immediate area of the project. Therefore,workshops are often an appropriate forum for gathering public input during conceptual planning.Public hearings and abutter meetings are better suited to later phases of the planning process,when there are specific alternatives or plans to which the public may react. Coordinated media relations also contribute to project quality.The project team benefits by designating one person-often a representative of the owner-to act as spokesperson and respond to media inquiries.Proactive efforts with the media are critical,especially in cases where road closures or other large-scale impacts make it impractical to contact every potentially affected party. SUMMARY The study of alternatives and impacts is common to constructed projects. Regardless of a project's size,a systematic approach to this process helps improve overall quality.Successful project teams generate a relatively wide range of potential solutions,screen out those with the least potential to meet the owner's goals,and apply engineering refinements to those alternatives with the greatest potential to successfully meet those goals.While the proj- ect team works together to produce a preferred alternative,the owner (or oth- ers to whom they may be obligated,such as a regulatory agency)is responsible for choosing the final alternative. 77 Public Involvement Strategies (partial list) ¢Workshops e Visioning or brainstorming ses- sions ®Citizen Advisory Committees ¢Open houses ©Focus groups *Collaborative (multi-party)task forces ©Media outreach e |nternet web sites ©Meeting facilitation ¢Telephone surveys ©Video tapes/cable television programs The success of the alternatives study process hinges on the skill of the proj- ect team in generating and evaluating the level of detail that is appropriate during each phase of analysis.Getting the right level of information at the right time applies not only to project engineering activities,but to agency and public involvement as well.O Chapter 8:Alternative Studies and Project Impacts Typical Responsibilities Responsibility Design Design- ig Owner Professional Constructor Builder State goals and objectives e@ Develop project conceptualization e@ e Prepare existing conditions and @®e@ @ future needs analysis Implement framework for developing e e conceptual alternatives Select a preferred conceptual alternative @ e@ r Manage environmental documentation @®@ e@ and permitting Coordinate public involvement e ©© @ =Primary Responsibility @ =Assist or Advise ©=Review 78 CHAPTER 9 PLANNING AND MANAGING DESIGN n the design phase,the owner's goals and objectives for the project that were established during the conceptual phase take form as team members prepare the construction documents.Planning and managing the design effort involves organization,direction,control,and coordination,all of which are essential to achieving quality. The complexity of the design effort varies with each project.This chapter describes a general process for planning and managing design that may be condensed for small projects or expanded for larger ones. 9.1 ORGANIZING FOR DESIGN After developing a clear understanding of the owner's goals and objectives, the design professional prepares the design activity plan.This plan may take the form of an arrow diagram or flow chart identifying the activities required to deliver contract documents to the owner.The plan identifies the relation- ships among the various activities required for completion of the design and estimates the duration of each activity and associated staffing and labor.With an activity plan,milestones can be set and related design costs defined.This information reflects the scope of services as outlined in the solicitation for professional services,contract agreement,and corresponding schedule and budget.A detailed list of activities assists in identifying necessary team mem- bers and areas of expertise,as well as in providing direction in establishing project record keeping requirements. 9.1.1 Initiating Design (Start-Up) Design efforts should begin with a design team meeting during which the design team leader reviews the owner's goals and objectives for the project with other design team members.The design team then reviews the scope of work and discusses the relationships among various tasks in the scope,the deliverable for each task,and the budget for each task.The team develops plans for achieving the goals and objectives within the established schedules and budgets.The meeting also provides an opportunity for the design team to confirm their ability to fulfill the responsibilities of the design effort. Upon securing the commitment of the design team,the design team leader meets with the owner to review the design schedule.If the owner requests a revision in the design schedule or deliverables,the design team leader reviews these changes with the design team for possible conflicts before starting design activities. 79 In this chapter 9.1 Organizing for Design 9.1.1 Initiating Design (Start-Up) 9.1.2 Producing Design Documents 9.1.3 Quality Assurance/Quality Control 9.1.4 Design Close-Out 9.2 The Design Team 9.2.1 Design Team Leader 9.2.2 Design Team Staff 9.2.3 Associate Consultants 9.2.4 Quality Assurance Reviewer 9.3 Project Design Guidelines 9.4 Coordination and Communication During Design 9.5 Monitoring and Controlling Design Cost and Schedule Typical Phases of Design 1.Start-up 2.Production 3.QA/OC 4.Close-out >Chapter 20,"Quality Assurance/Quality Control” >9.2.4,"Quality Assurance Reviewer” The ability to meet schedule commitments and remain within budget is directly related to the performance of both the design team and the owner.It is the owner's responsibility to provide the items specified in the owner-design professional agreement,including timely review and appropriate comment on submittals by the design team. 9.1.2 Producing Design Documents The design team,under the direction of the design team leader and with the owner's review,produces the construction documents.To accomplish this,the design team leader develops a design activity plan,which serves as the road map for successful design completion. Design team members discuss deviations from the design activity plan with the design team leader.The design team leader then evaluates changes that may be needed to assure that the schedule and budget can be maintained while meeting the project goals and objectives and fulfilling contractual responsi- bilities to the owner.The design team develops recovery measures to keep the design effort on schedule and within budget.These measures may include staffing adjustments,overtime,use of associate consultants,and/or modifi- cations to the original schedule and budget. 9.1.3 Quality Assurance/Quality Control The design professional (or in-house design team)can help assure project quality through several activities,including: *Developing a scope of services that meets the owner's requirements and the project goals and objectives; ¢Developing a design activity plan for the project; ¢Defining project design guidelines; ¢Estimating accurately the hours of effort and costs involved to achieve a quality design; ¢Building flexibility into the design activity plan to allow for changes and future project development,as well as associated budget and sched- ule revisions; ¢Developing a realistic schedule with appropriate milestones to confirm progress; ¢Monitoring design progress constantly. One of the most important things the design team leader can do to assure qual- ity is to make sure that the team includes personnel who are experienced and knowledgeable in the assigned tasks,and to make these personnel available to complete the necessary tasks.The design team leader also benefits from assigning an appropriate number of staff for the tasks at hand.Assigning too many or too few staff members can result in inefficient resource utilization or staff "burnout”from excessive overtime. In addition,the design team leader can promote quality by assigning the responsibility for gathering site information and completing field surveys to 80 experienced survey professionals.These survey professionals benefit from the use of a standardized checklist to investigate known or unknown buried structures,the capacities of existing utility lines and drainage facilities,and other site conditions that affect design and construction. 9.1.4 Design Close-Out Design close-out is the process of completing scope of service items and archiving drawings,records,and as-built documentation.Design close-out activities provide an excellent short term opportunity for the design team, associate consultants,and design team leader to assure that the project design as described in the construction documents has been completed successfully. Design close-out also provides long term benefits by assisting with the archiv- ing of information for future reference by the owner. Design close-out activities generally follow the steps below: 1.Design team members and associate consultants organize and submit their work to the design team leader. 2.The design team leader reviews the submittals for completeness. 3.The design team leader conducts a post-design and post-construction interview with the owner and constructor,and completes the design por- tions of the project close-out checklists. 4.The design team leader ensures that design submittals are archived in accordance with the project design plan. 9.2 THE DESIGN TEAM Assembling a qualified team that is specifically suited for the project is the first and most important step in assuring design quality.Project quality is directly related to continuity of the design team throughout the life of the project. 9.2.1 Design Team Leader The design team leader is the key contact person for the design team.This person is responsible for accurately understanding the owner's goals and objectives for the project,relaying them to design team members,and mak- ing sure that they are addressed and/or incorporated in the design.To accom- plish these general responsibilities,the design team leader conducts or monitors the following activities: ¢Defines the project scope of work ¢Develops a design team staffing plan and expectations.to include personnel with the neces- *Develops a design budget that sary technical expertise and avail- reflects the resources and organiza-ability. tion necessary to perform the work.¢Develops checklists for the contract *Develops a design schedule that documents and deadlines for the allows design review and construc-completion of design activities. tion to be successfully completed *Coordinates development of the within the total amount of time project procedures. available to complete the project. 81 >16.3.7,"Project Close-Out” >92.3,"Associate Consultants” Project quality is directly related to continuity of the design team. ¢Defines the project's design guide-*Manages the design team's perform- lines.ance,budget,schedule,and decision- *Establishes quality assurance and making. quality control (QA/QC)procedures ©Updates contract agreements neces- within the design activity plan.sitated by scope changes,schedule *Develops assignments for the design delays,or other events. team.¢Schedules in-house and owner reviews. These responsibilities allow the design team leader to monitor overall progress of the design effort and identify potential problems in a timely manner. 9.2.2 Design Team Staff Design team staff members are responsible for understanding and carrying out the necessary design tasks.These tasks may vary in scope and complex- ity,according to the goals and objectives of the owner.The design team staff usually includes highly experienced engineers,drafters,architects,structural specialists,and administrative support personnel. 9.2.3 Associate Consultants The design team may include associate consultants,often known as subcon- sultants,in the design planning process.Associate consultants are typically responsible for: ¢Developing a clear understanding of the owner's project goals and objectives and the overall design plan; «Communicating specialized design activities to the design team leader; ¢Leading design team efforts in a specific discipline. If associate consultants do not have an opportunity to assist in developing the scope of services,or if they are not consulted in a timely manner when problems arise,the quality of project elements involving multiple disciplines may suffer. 9.2.4 Quality Assurance Reviewer The quality assurance reviewer is a member of the design team who is respon- sible for monitoring the quality contro!activities.The quality assurance reviewer should be highly experienced in the aspects of the project design and not involved in the day-to-day design activities.This person should attend the start-up and close-out meetings and will meet with the design team leader several times during the project to critically review the following: *Design concept approach; ¢Schedule compliance; *Key decisions to be made; ¢Anticipated and actual changes in the scope of work; 82 ¢Issues for resolution; ¢Report on quality control reviews. 9.3 PROJECT DESIGN GUIDELINES Each owner has goals and objectives for the project that must be communi- cated to the design team.These goals may be fairly easily specified,quanti- tative,design parameters,such as a specific loading for a bridge,or required flow rate and water quality for a wastewater treatment plant. But the owner's goals and objectives can also be more qualitative in nature. The owner may only have a general idea of what the constructed facility should look like or how it should operate.In these cases,the design team ben- efits from first developing a set of design guidelines to refine the project goals. The guidelines may involve the preparation of studies to evaluate alternative concepts.The design team reviews the alternatives with the owner to reach agreement on the design approach that best meets the owner's goals and objec- tives within the project budget. Based on this agreement about the owner's goals and objectives,the design team develops specific project design guidelines.The agreement between the owner and design professional on the expected results of the design- and the documenting of this agreement in writing-is a fundamental step in assuring project quality. Viable design solutions must comply with federal,state,and local codes and regulations.In some cases,regulatory agencies influence the investigation of alternatives and the design approach.It is important that discussions which include the owner,design professional,and regulatory agencies be initiated early in the design effort and continue through final design to avoid unnec- essary delays or surprises during the agency approval process. 9.4 COORDINATION AND COMMUNICATION DURING DESIGN The design team leader is responsible for keeping the owner and other design team members up to date on the status of design progress.Monthly progress reports to the owner,with copies to members of the design team,are a typi- cal means of accomplishing this.Complex or fast-moving projects may ben- efit from more frequent reporting.Design progress reports describe the meetings held and work accomplished during the reporting period and the activities scheduled for the upcoming reporting period.Design problems should be identified as early as possible so that potential conflicts with the established scope,budget,or schedule may be resolved.Depending on the resolution,the design team may need to revise the design plan. As most projects involve more than one design discipline,the design team benefits from regular meetings.These meetings offer team members the opportunity to familiarize themselves with overlapping aspects of the design 83 >Chapter 8,"Alternative Studies and Project Impacts” Design costs are typically five percent of the life- cycle cost of a project, yet design is the single most important influence on project cost and quality. process.Though each team member may be dedicated to achieving the design guidelines,conflicts may arise.The team benefits from resolving such con- flicts quickly and at the lowest level of the organization possible.But if the proposed solution conflicts with the owner's goals and objectives for the proj- ect,the design team will benefit from meeting with the owner to discuss the conflict and devise appropriate solutions. 9.5 MONITORING AND CONTROLLING DESIGN COST AND SCHEDULE The design team leader regularly monitors reports that reflect budgeted and actual expenditures.The information in these reports allows the design team leader to evaluate design progress to date and identify potential problems.If additional design services not specified in the professional services agreement are necessary to correct problems and meet overall project goals,it is in the project's best interest for the design team leader to communicate this infor- mation to the owner immediately and negotiate for the additional services. A design activity plan typically includes milestone and submittal dates for the design progress reports.The owner's timely review and approval of interim submittals are important activities in maintaining the project schedule.Interim submittals offer the owner the opportunity to review design activities at a point in the design process when budgets and schedules can more easily accom- modate change. SUMMARY During the planning and management of design,the relationship between the design professional and the owner is crucial.The professional services agree- ment between these two parties is the key document in defining this rela- tionship as well as the owner's goals and objectives for the project. The owner benefits by furnishing the information specified in the agreement, as well as other assistance,in a timely manner.The owner monitors design activ- ities by reviewing and approving contract documents,progress reports,and other submittals,which provide the opportunity for prompt decision-making. The design team leader,supported by the design team,organizes the over- all design effort.This includes providing experienced and knowledgeable staff,developing appropriate design tasks,and monitoring the performance of the design team.The design team leader manages the design effort and communicates with the owner on matters affecting design progress,sched- ule,and budget. The design team works closely with the owner to investigate design alterna- tives and then develops project design guidelines for the owner's review and approval.The design team also reviews the design guidelines with regulatory agencies when appropriate.Good design planning and management can reduce or eliminate the "surprises”and unexpected events that can adversely affect project quality.O 84 Chapter 9:Planning and Managing Design Typical Responsibilities Responsibility iv Owner Design Professional Constructor Design- Builder Initiate design start-up Produce design documents QA/OC Design close-out Select design team staff Develop design guidelines Coordinate and communicate during design O OeO000@ =Primary Responsibility @®=Assist or Advise 85 ©=Review CHAPTER 1 0 DESIGN DISCIPLINE COORDINATION Me projects require that the design team leader coordinate the activi-ties of design practitioners in principal and support engineering disci- plines.This chapter discusses the coordination of multiple design disciplines, drawing examples from three types of projects:engineering-design;archi- tectural-design;and design-build.Variations on these three types of multi- disciplinary projects,as well as different delivery systems,form the growing variety of options available to project owners to meet the goals and objectives of their projects. This chapter presents representative examples of multidisciplinary design interrelationships.The relationships of various design disciplines will vary with the actual contractual responsibilities established for each project. 10.1 LEVELS OF DESIGN DISCIPLINE ORGANIZATION There are typically three levels of design organization on multidisciplinary projects:the team leader,the principal discipline practitioners,and the sup- port discipline practitioners. 10.1.1 Design Team Leader The leader of the design team has the primary responsibility to the owner for meeting the project's design objectives and for staffing the design team with individuals and subconsultants who are qualified and experienced in the prin- cipal and support technical disciplines. The design team leader directs practitioners from each principal design dis- cipline who integrate their technical knowledge with that of support disci- plines toward satisfying the project objectives.With alternate delivery systems, this coordination may require some short-term compromises in efficiency and cost so that design issues can be adequately explored.The design team lead- ers also resolves conflicts among technical discipline professionals.The design practitioners within each discipline must consider the safety of the user,the public,and the environment as they work with colleagues in other disciplines who are also striving to meet these objectives. 10.1.2 Principal Discipline Practitioners These members of the design team typically supply the technical expertise and carry out the design effort in a principal area of design,such as archi- tectural design or structural,civil,mechanical,and electrical engineering design.They are also responsible for coordinating their services with other principal discipline practitioners on the project. 87 In this chapter 10.1 Levels of Design Discipline Organization 10.1.1 Design Team Leader 10.1.2 Principal Discipline Practitioners 10.1.3 Support Discipline Practitioners 10.2 Design Disciplines and Project Objectives 10.2.1 The Engineering Design Project 10.2.2 The Architectural Design Project 10.2.3 The Design-Build Project 10.3 General Design Team Coordination Considerations 10.4 Role of the Professional Discipline Leader During Design 10.5 Role of the Design Professional During Construction Principal Design Disciplines Architectural Civil Electrical Mechanical Structural Support Disciplines Geotechnical Hydrology Landscaping Scheduling and estimating Space planning Surveying Traffic Urban planning 10.1.3 Support Discipline Practitioners These team members support the services of the principal discipline practi- tioners by measuring and testing the physical characteristics of the project site and construction materials.Support disciplines include geotechnical inves- tigation and analysis,materials testing,surveys,and hydrologic analysis. Support disciplines also include specialized fields,such as urban planning and landscaping,traffic analysis,as well as scheduling and estimating. The services and coordination of the principal and support design discipline practitioners usually continues beyond the completion of construction con- tract documents.During the construction phase of the project,they may be called upon,under the terms of the professional services agreement,to inter- pret the implementation of design by the constructor. 10.2 DESIGN DISCIPLINES AND PROJECT OBJECTIVES The requirements and responsibilities of the team members from each design discipline involved depend on the type of project proposed,the project objec- tives,and the associated contractual relationships.The following sections pres- ent examples of three different general project organizational concepts and contractual relationships: 1.Engineering design projects 2.Architectural design projects 3.Design-build projects These types of projects often involve design delegation,a relatively preva- lent practice in most forms of civil construction under which the design of a portion of the permanent project work is delegated to the constructor or spe- cialty subcontractor.This entity typically engages a design professional to produce a design that is consistent with a preliminary or conceptual design that is furnished by the project's prime design professional. 10.2.1 The Engineering Design Project The objectives of an engineering-oriented project are usually determined by the functional objectives or specifications of the completed facility. Engineering projects (see Figure 10-1)include private facilities such as indus- trial plants,and public infrastructure such as wastewater treatment facilities, roads and highways,or transit systems.The design team leader for the engi- neering project usually has expertise directly applicable to the project.For example,mechanical engineers may lead a cement plant project,where the process flow determines the plant arrangement;structural engineers may lead a transit system project,where bridges or underground structures comprise the primary project components. 10.2.2 The Architectural Design Project The objectives of an architectural project are determined primarily by aes- thetics and function,as opposed to being principally focused on engineering considerations.Architectural projects include private office buildings,com- 88 OWNER Figure 10-1 Multidiscipline Project Organization for Engineering Design Project F OWNER 'd Alternate For Qwner- Provided Process Engineering DESIGN TEAM ;; " MANAGEMENT Engineering Professional Engineering -_Process Team Leader 2 Engineering PRINCIPAL Structural Electrical Mechanical CivilcturaDISCIPLINES*ru ur ec rica Architecture ec anica 'Ivl ;Engineering Engineering Engineering Engineering SUPPORT ; : ... DISCIPLINES*Geotechnical Surveying Hydrology Traffic Corrosion Scheduling,Engineering Engineering Engineering Engineering Estimating *May contract directly with owner and supply information for use by design professional mercial developments,and residential complexes;institutional facilities,such as educational buildings,hospitals,and correctional facilities;and public struc- tures,including government buildings and monumental structures. Like engineering projects,architectural projects (see Figure 10-2)require the coordination of several design disciplines.The distinguishing characteristic of the design organization in an architectural project is that architecture is the lead (or prime)discipline,and the principal and support disciplines form the second and third design tiers of the design organization. 10.2.3 The Design-Build Project In a design-build project (see Figure 10-3),the project team coordinates all the design functions and the construction functions as well. However,the internal organization of the design-build team shares some sim- ilarities with the traditional contracting approach.There are usually two sub- sidiary managers who report to the design-build manager:the design team leader and the construction team leader.The design team leader's organiza- tion is very similar to that of an engineering or architectural project.In con- structor-led design-build projects,the constructor may independently retain multiple design professionals (rather than one prime with multiple subcon- sultants).As a variation of design delegation,as described in Section 10.2, trade subcontractors of the prime constructor on a constructor-led design- build project may retain their own specialized design professionals to design portions of the permanent work. 89 Figure 10-2 Multidiscipline Project Organization for Architectural Design Project Civil Engineering QWNER OWNER DESIGN TEAM ; MANAGEMENT Architectural Professional Architectural Design Team Leader PRINCIPAL Structural Electrical WochanicalDISCIPLINES*ructura ectrica Architecture echanicaEngineeringEngineeringEngineering SUPPORT Geotechnical 5 UbDISCIPLINES*eotecnnica F pace rban . Engineering Surveying Planning Planning Landscaping *May contract directly with owner and supply information for use by design professional Scheduling, Estimating OWNER DESIGN TEAM MANAGEMENT PRINCIPAL DISCIPLINES* SUPPORT DISCIPLINES* Figure 10-3 Design-Build Project Organization OWNER Design-Build Manager Design Team Project Scheduling Construction Leader Controls Estimating Supervisor i Subcontractors || Structural Electrical Archi Mechanical Civil Engineering Engineering rehitecture Engineering Engineering Landscape Surveyin Traffic Geotechnical Architecture yng |Engineering Engineering *May contract directly with owner and supply information for use by design-builder 90 In addition,the design team,including subconsultants,may perform some of the design or construction planning that a stand-alone constructor would be expected to complete,including the design of temporary structures,lay-down areas,fabrication yards and similar facilities. 10.3 GENERAL DESIGN TEAM COORDINATION CONSIDERATIONS The project's functional objectives,budget,schedule,and other characteris- tics determine the design team's objectives.The team usually prepares a proj- ect plan describing these considerations,as well as constraints on design and construction,and associated design codes and technical criteria. The main goal of the principal design discipline practitioner is to develop a coordinated design that satisfies the owner's goals and objectives in the areas of function,cost,quality,and schedule without compromising the public's health,safety,and welfare.Design coordination at the principal design dis- cipline level involves negotiating compromises.One common area of com- promise is that of initial capital cost versus long term operating efficiencies. An owner may choose to minimize capital costs and accept higher operating costs if he or she is not presented with sufficient choices and cost/benefit analyses in a way that promotes informed decision making.Compromise may also involve tradeoffs between design disciplines,such as mechanical engi- neers coordinating the size and location of equipment openings in structural members with the structural engineers. The extent to which design compromises are made to accommodate the needs of a particular discipline is directly related to the project objectives-except when safety is concerned.The safety of the user and the public,as well as compliance with environmental protection laws,are primary requirements for team members of every discipline.With respect to compromises that are made, it is recommended that the design team leader adequately document in writ- ing the basis for the compromise(s)and highlight the associated tradeoffs. Design considerations on which compromise may be more easily negotiated include aesthetics and the ability to be upgraded in the future. The owner plays a crucial role in design discipline coordination.In many of the considerations noted above,only the owner can provide the guidance or clarification of project priorities that will allow the design team to produce a design that meets the project objectives.A coordinated design benefits the owner,by controlling construction costs through reduced changes,increasing the functional efficiency of project components,and enhancing the aesthetic qualities of the facility. Design discipline practitioners are often forced to decide whether to sacri- fice peripheral design interests so that the owner's project goals may be achieved.While this would seem to be a basic principle,it can be difficult to follow during an active design effort.The design practitioner,therefore,ben- efits from keeping the owner informed about potential and actual design 91 compromises.The owner,in turn,benefits from taking an active role in mak- ing difficult choices. Contractual relationships between the owner and practitioners of various design disciplines take many forms.Depending on the type of professional service agreement(s),there may be a single prime design consultant or a separate subconsultant for each design discipline.In the case of a large multidisciplinary firm,the required expertise in each discipline may be included as part of a single professional service agreement.However,the basic structure of principal disciplines and support disciplines generally remains the same. 10.4 ROLE OF THE PROFESSIONAL DISCIPLINE LEADER DURING DESIGN Design discipline leaders manage and oversee the design tasks within their respective principal and support disciplines.Leaders of the principal design disciplines report to the design team leader for the project.Leaders of sup- port design disciplines may report to an assigned principal discipline leader, the design team leader,or the owner,depending on their contract.Design discipline leaders are responsible for on-going dialog with the design team leader and owner,making technical decisions,assembling qualified staff to meet technical and schedule objectives,managing the discipline team,and coordinating with team members from other disciplines. Principal and support design discipline leaders are also responsible for: *Fulfilling contract obligations and project objectives; *Maintaining technical correctness; e Managing resources; *Checking for compliance with codes and regulations applicable to their discipline. The primary benefits of a multidisciplinary design team include the ability to produce an integrated project design that meets the owner's objectives by drawing upon the full array of specialized technical skills required to meet a project's objectives.Within the team,the professionals in each discipline are responsible for the appropriate application of relevant technical engineering principles,seeing that these applications are compatible with the design to achieve the overall project objectives.Foremost among the issues that design discipline practitioners address in this process are constructability,maintain- ability,capital cost,operating cost,and aesthetics.These issues are consid- ered and weighed critically to help achieve a quality design. In general,measures of design quality include: *Responsiveness to the owner's requirements in the areas of cost,qual- ity,and schedule; *Soundness of technical approach; *Correctness and clarity of numerical and graphic representations; 92 *Degree of coordination and integration of necessary disciplines into the constructed project; ¢Adequacy of technical specifications. As a decision-making member of the design team,each principal discipline leader is responsible for assisting other members in developing integrated design solutions.The discipline leader considers not only the project objec- tives that are applicable to a specific discipline,but also the objectives that are applicable to other disciplines.Good design discipline leaders must develop an understanding of and sensitivity to the concerns and goals of other design disciplines.They must also be willing to be critical of their own design contributions,as well as those of other disciplines. 10.5 ROLE OF THE DESIGN PROFESSIONAL DURING CONSTRUCTION In addition to design services,the design professional's agreement with the owner should include services during the construction phase of the project. The design professional's construction-phase services can contribute signif- icantly to project quality,because of the design team's close familiarity with the intent of the design with respect to the requirements of each discipline and the overall project objectives. During construction,discipline leaders are typically responsible (depending on the terms of their contracts)for a variety of additional activities,including: *Coordinating with other discipline leaders; ¢Monitoring and controlling the budget for their respective discipline; ¢Reviewing the submittals,including shop drawings,as required by and for the purposes stated in the construction documents; ¢Becoming familiar with the construction site; ¢Evaluating alternative materials and designs; ¢Observing and evaluating construction work for general conformance with the contract documents; ¢Evaluating modifications or changes; *Reviewing and certifying the constructor's pay applications; ¢Participating in start-up,testing,final review (close-out),and reporting. SUMMARY Constructed projects almost always involve more than one design discipline. Therefore,the coordination of principal and support discipline activities is a key aspect of project quality.For multidisciplinary projects,the design team leader usually oversees and manages the work of practitioners in the princi- pal and support disciplines.Good coordination among the principal and sup- port design disciplines is necessary for quality design. While the practitioners in each discipline may find it necessary to compro- mise on some proposed design solutions to accommodate other disciplines, 93 >Chapter 25,"Value Engineering” the hallmark of a quality design is one that meets the owner's project objectives. Well-defined project team relationships benefit design discipline coordina- tion.Alternate project delivery systems often shift the traditional roles and responsibilities of design discipline leaders and practitioners.However,the basic three-level organizational structure of design disciplines applies in the coordination of multidisciplinary design activities. While the design professional typically provides services during construction, some owners do not choose to involve the design professional in this phase. In such cases,the owner should be aware that if the design professional is not permitted to respond to questions regarding the interpretation of his or her design,the incidence of requests for information (RFIs)and change orders is likely to be greater.O Chapter 10:Design Discipline Coordination Responsibility Matrix Responsibility Design Design- gO Owner Professional Constructor Builder Authorize formation of O rd]@ multidisciplinary design team Assign multidisciplinary staff Contract with subconsultants Initiate and maintain communication and coordination for design effort Make periodic presentations to owner on system choices and implications.@®Oo@®@00Make decisions and provide guidance on design choices eo©@@0@8@ee©©@0@80Monitor and resolve conflicts among design disciplines ©@ =Primary Responsibility @ =Assist or Advise ©=Review 94 GUIDELINES ppropriate design practices are vital to achieving project quality.This chapter provides guidelines for design activities,including the design professional's office operations,relationships with the owner and construc- tor,design responsibilities,and quality assurance programs. 11.1 OFFICE OPERATION Qualified personnel and team chemistry are key components of a successful design office.The quality of design activities is directly related to the expe- rience of every member of the design team,as well as the ability of team members to communicate and support common objectives.Staff participation in continuing education programs and professional groups is valuable for help- ing staff stay up to date on current practices such as materials,design con- cepts,analysis methods,computer hardware and software for design and drafting,and current industry concerns.In some cases,particularly in small offices,the use of outside consultants can be of value,as it may not be pos- sible to maintain a staff with experience in all the needed practice areas.In these cases,teaming relationships should be established to allow the com- bined project team to build experience together. The selection of design team members is critical in achieving good team chemistry.The design team leader need not be an expert in any given field, but should have experience in the anticipated phases of the project.The team should include people with special expertise in relevant design disciplines. In addition to technical considerations,the design team benefits from the inclusion of engineers with varying perspectives.This mixture of talents and temperaments often generates questions and discussions that uncover impor- tant aspects of quality.Design team members with different backgrounds who work together tend to develop superior solutions.The role of the design team leader is to guide team members in this process,drawing upon his or her per- sonal strengths to foster the creative process,be assertive when necessary, ensure informal peer review,and maintain the project schedule and budget. The organizational structure of successful design offices reflects the particu- lar needs and objectives of the design team's current projects.Staff size,key personnel,office location and equipment,and other factors may vary signif- icantly over the life of a project.Large offices may benefit from the use of an organizational chart to help staff understand assignments,define respon- sibilities and authorities,and facilitate access to each other. 95 CHAPTER 1 1 FOR DESIGN In this chapter 11.1 Office Operation 11.1.1 General Management of the Design Office 11.1.2 Organization of Disciplines 11.1.3 Office Procedures 11.2 Design Procedures 11.2.1 Evaluation and Computation Procedures 11.2.2 Drafting Procedures 11.2.3 File Management Procedures 11.3 Design Activities and Responsibilities 11.3.1 Design Considerations 11.3.2 Sustainable Development 11.3.3 Design Reviews 11.3.4 Construction Costs 11.3.5 Constructability Reviews 11.3.6 Peer Reviews 11.3.7 Alternatives Evaluation and Value Engineering 11.4 Compliance with Codes and Standards 11.5 Regulatory Approvals and Permits 11.6 Public Funding 11.7 Design Responsibility >Chapter 9,"Design Discipline Coordination” A standardized approach to office organization is intended to support creativity,not inhibit it. 11.1.1 General Management of the Design Office Design office management activities include the hiring and retaining of appro- priately qualified staff,procuring design contracts,sound financial and accounting procedures,establishing and communicating goals and objectives, as well as implementing standard operating procedures.Depending on the size of the office and the diversity of functions performed,the office many be managed by a senior member of the technical staff or by an individual with special financial,management,or marketing skills.Offices of 20 or more employees often designate an office manager to oversee administrative tasks, such as payroll and accounting. 11.1.2 Organization of Disciplines Design firms benefit from organizing and deploying staff according to the needs of existing and expected workloads.One strategy for project organi- zation is to assign qualified personnel to the design team from each of the rel- evant disciplines.These team members are,in effect,representatives of their respective disciplines,working under the guidance of the design team leader, to manage a particular project. Another effective strategy is to organize the design firm in departments based on individual disciplines (or appropriate combinations of disciplines).This type of organization can be effective in large firms with many projects under- way at once. 11.1.3 Office Procedures Office procedures for design firms vary widely,depending on the corporate culture,staff size,geographic location,and nature of work.This section pro- vides some general guidelines that may benefit offices of any size. Consistent personnel policies and procedures promote effective and efficient office functioning.Consistency provides a common reference point for dif- ferent projects that the firm undertakes and helps improve overall quality. When members of the design team spend less time worrying about proce- dures or where to find things in the office,they are better able to concentrate on meeting the design objectives of the project at hand. This standardized approach to office organization is intended to support creativity,not inhibit it.Regular practices are a key element of a firm's "cor- porate cylture,”providing a foundation for the exploration of solutions to the unique objectives or cost of a particular project.Office quality control pro- cedures should be considered flexible and amended when necessary to provide better support of a project. There are a variety of manuals available to aid in defining consistency in var- ious design office activities,including: *Employee guide to personnel policies and procedures; *Job descriptions; *Style manual (i.e.,The Chicago Manual of Style); 96 ¢Guide to editing (i.e.,The Elements of Style); *Dictionary (office should use one edition consistently); «Project support services (including scheduling software and specialty consultants); ¢Accounting (software programs and financial consultants); *Manuals for all computer hardware and software on the premises. 11.2 DESIGN PROCEDURES Design procedures include evaluation and computation,drafting,and file man- agement.In each of these areas,a manual or guideline on design procedures is helpful.The manual or guideline usually addresses the purpose,process, and measurement of quality. 11.2.1 Evaluation and Computation Procedures The design team develops and maintains standard procedures and guidelines for the engineering disciplines,such as structural engineering,that are required for the projects in which the firm is engaged.Design issues often present several alternatives for evaluation.A guideline that includes definition of resources,evaluation processes,and documentation should be developed and used consistently.Engineering computations should be based on standard pro- cedures and methods,and properly documented in project files. Calculation sheets,which are the records of design loadings and other cal- culations that demonstrate structural stability,are particularly important doc- uments of project activity.Calculation sheets are considered a major component of project services that may be referenced many years after proj- ect completion.As such,these records must present design criteria and assumptions clearly and be checked for accuracy. The development of consistent procedures for calculation sheets and other frequently employed design procedures helps save time,reduce the likelihood of error,and increase the level of quality. 11.2.2 Drafting Procedures The design professional's drawings and specifications provide the construc- tor with the necessary information on the design concept,complexity,and scope of the job,materials,performance,and quality objectives,as well as numbers and sizes of materials or items. The preparation of drawings,known as "drafting,”is one of the most funda- mental and important skills of the design professional.While drafting by hand remains an important capability,drafting today is primarily completed by computer-aided drafting,or CAD,technology.Drafting procedures include the following general steps,many of which are performed with some degree of automation through CAD assistance: ¢Development of drawing standards,mechanics,data management,secu- rity,and filing practices through a written CAD plan; 97 >21.3,"Computers and the Design Professional” *Preparation of a schedule and content outline of planned drawings; *Use of precise,legible lettering,fonts,and layering; *Coordination of drawings with technical specifications; *Use of legible and consistent dimensioning; ¢Use of standard symbols,abbreviations,and uniform terminology; ¢Clear,clean drawings to improve the legibility of reduced-size reproductions; *Preparation of rough layouts,to determine the placement and scale of the drawings on the sheets (interdisciplinary coordination is improved if corresponding plans are drawn to the same scale and arranged consistently). Many owners have developed their own drafting standards.Discussing these standards with the owner before drafting begins can help prevent costly rework. 11.2.3 File Management Procedures A document filing system greatly increases office efficiency.Effective filing systems focus on enhancing the speed and accuracy of document retrieval, not just storage.Filing systems typically employ standard designations,clas- sifications,and dates so that documents can be indexed correctly and located quickly.Examples of documents to be filed include project development mate- rials,correspondence and reports,telephone and conversation logs,design calculations,drawings and specifications,quality control forms,cost esti- mates,schedules,time sheets,project costs,value engineering or life-cycle cost information,shop drawings and manufacturer's submittals,and con- struction reports to the owner or regulatory agencies and project close-out documents.Large or complex projects may require separate files for each of the categories mentioned,while a single file may be sufficient for small proj- ects.Files may also be arranged by project phase. Documents should also be stored in electronic database files with similar file management structure as established for hard copy files.Current software pro- grams generally facilitate electronic "folders”for data management.Access to electronic files should be reviewed to assure proper security. The appropriate length of time to keep documents after a project is completed depends on contract provisions or on the potential need to refer to them for future work,subsequent claims,or historical documentation.State and fed- eral agencies or statutes may require the retention of certain documents for specified periods after project completion.Duplicate printed copies may be discarded before filing and electronic copies of documents on computer disks or microfilm may help reduce storage and space needs. 11.3 DESIGN ACTIVITIES AND RESPONSIBILITIES Design quality is measured by a wide range of criteria.These include adher- ence to basic engineering principles and professional standards,fulfillment of the owner's goals and objectives,and conformity with applicable codes 98 and standards.In addition to meeting technical objectives,the design profes- sional is more likely to achieve project quality by giving strong considera- tion to factors that relate to user acceptance,such as security,appearance, noise,traffic impacts,and relationships to surrounding buildings or neigh- borhoods.A quality design should also strive to provide project solutions that emphasize flexibility,adaptability,and expandability in a cost-effective manner. Effective communication with the owner and the constructor plays an impor- tant role in achieving a quality design.The design professional develops spec- ifications for the constructed project and then communicates the design intent to the constructor via the plans and specifications.Design quality also bene- fits from a pre-established understanding and agreement among the project participants on how to process change orders,clarify details,correct mistakes, and resolve conflicts. 11.3.1 Design Considerations Three important considerations influence project design quality:serviceabil- ity,life-cycle costs,and construction phasing. Serviceability refers to factors that affect the usefulness of a project.These include the subjective perceptions of users,as well as project elements that are designed to address code requirements.For example,in a building these factors include vibration,building sway from wind,and sound transmission. Partial or total mitigation of these phenomena may increase costs,so the design professional should discuss the benefits and costs of mitigation meas- ures with the owner and reach an agreement on the degree to which these issues will be addressed. Life-cycle costs consider the design and construction costs,operating and maintenance costs,and decommissioning costs taking into account the time value of money.Life-cycle cost determinations require analysis of initial cap- ital costs,projected increases in costs,and the anticipated life span of mate- rials,equipment and finishes.For example,an owner may choose to pay greater initial capital costs for a mechanical system with lower operating costs to reduce expenses over the life of the project.In some cases,owners may deliberately choose low initial capital costs over lower life-cycle costs,espe- cially if they plan to sell the project before major maintenance is required.In either case,the design professional achieves greater project quality by pro- viding information on the various life-cycle cost options to assist project own- ers in meeting their requirements. Construction phasing is a third design consideration in meeting project goals successfully.The designer may accommodate an owner's desire to build quickly by adopting a phased (or fast-track)approach.Under fast-tracking, conceptual planning,design,and construction may take place concurrently so the project,or portions of it,can open and begin generating revenue as soon as possible. 99 >Chapter 5,"Coordination and Communication” >Chapter 24,"Partnering” >3.6,"Fast-Tracking:A Distinction” Sustainable Development:In a constructed project,the incorpora- tion of planning and design ele- ments that take into account the environmental and socioeconomic effects of natural resource deple- tion and waste management (ASCE definition). Sustainable Development Resources ty U.S.Department of Energy:www.sustainable.doe.gov ay U.S.Green Building Council:www.usgbc.org ty Environmental BuildingNews:www.ebuild.com However,fast-tracking limits design flexibility in responding to changing con- ditions or owner requirements.Initial savings from the fast-track approach may be offset by the larger design and construction contingency allowances necessitated by the greater number of unanticipated changes that typically occur during fast-track design and construction.Construction cost estimates are less precise because they must be based on incomplete plans and specifications. 11.3.2 Sustainable Development The consideration of sustainable development impacts is integral to a con- structed project,and it is recommended that the project team address sus- tainability issues throughout planning,design and construction. The concept of sustainable development came to prominence in 1987 at the World Commission on Environment and Development.A broad definition, adopted at the 1992 United Nations Conference on Environment and Development in Rio de Janeiro,includes the key phrase,"meeting the needs of the present without compromising the ability of future generations to meet their own needs.” Sustainable development for the owners,design professionals and construc- tors of projects is the incorporation of planning and design elements that take into account the environmental and socio-economic effects of natural resource depletion and effective waste management.For example,a sustainable devel- opment analysis of life-cycle costs would include the extended effects of raw materials and product manufacturing,as well as the subsequent decision for final waste disposal,reuse,or remanufacturing of the project components at the end of the design life of the facility (e.g.,the costs of decommissioning a power plant).While current quantitative analysis methods do not often include ways to fix values on some of these sustainability concepts,a qual- ity constructed project includes a study or comparison of potential construc- tion materials with respect to relevant sustainability concerns. The long term impacts of failing to consider sustainability in project devel- opment will be a continuation of the trend toward natural resource exhaus- tion and environmental degradation.Neglect of sustainability issues also compromises the ability of future generations to meet their needs for adequate food,transportation,energy,shelter and environmental quality of life. 11.3.3 Design Reviews Many owners require reviews at various stages of project design (e.g.,10, 30,and 60 percent complete)to determine if the project objectives being developed are in accordance with the project goals.Similar reviews by the project team,even if the owner has no such requirement,may save the design professional considerable time and expense and improve project quality. 11.3.4 Construction Costs The cost of construction is an important factor in the owner's decisions regard- ing project feasibility and financial planning.The design professional, 100 although unable to guarantee construction costs,can provide an opinion of probable construction costs to the owner. Often,the design professional's opinion of probable construction costs is based on staff experience with similar projects.If such experience is not avail- able directly from the design professional's staff,the design team leader may wish to engage experienced professionals to aid in developing construction cost opinions.In addition,owners may often elect to develop their own estimates of construction costs using professional cost estimators.It may be desirable to review these different construction cost estimates with an expe- rienced constructor,allowing enough time to study the plans thoroughly and do a complete inventory of material quantities (known as "take offs”).The knowledgeable owner realizes that cost opinions and estimates,except pro- posals tendered by a constructor,are approximate and may be subject to influences outside the control of the design professional.Unless specifically represented as a binding proposal,construction cost opinions and estimates should be regarded as reasonable approximations.For this reason,the design professional's cost opinion should include a contingency that is dependent on the level of design development at the time the opinion is prepared. Information on representative unit costs may be obtained from: *Construction cost indices in recognized industry publications; *Local cost records published by construction associations; *Unit prices published by state agencies,including local construction craft labor rates,local workforce availability,work conditions,and mate- rial costs; ¢Information from bids for similar projects (especially valuable from specialty projects); ¢Publications of the American Association of Cost Engineers; ¢Cost opinion solicitations from qualified manufacturers,vendors,and constructors. 11.3.5 Constructability Reviews Project constructability refers to the evaluation of a wide range of informa- tion that directly affects the ability of the constructor to actually complete the project.Constructability considerations include the adequacy and com- pleteness of information in the plans and specifications,site restrictions,eco- nomic considerations,the availability of materials,construction equipment requirements,local work force availability,contract required construction phasing and environmental considerations. Constructability also involves the practicability of achieving specified toler- ances,obtaining sufficient access and laydown space,and resolving conflicts between architectural,mechanical,electrical,and structural requirements or elements.These issues often involve maintaining existing facility operations and ensuring continuous utility service.Some of these continuous utility serv- ice issues are best addressed by a written Maintenance of Plant Operations (MOPO)plan.Three-dimensional models,both full and reduced scale,are 101 > >Chapter 8,"Alternative Studies > vy Chapter 22,"Peer Review” and Project Impacts” Chapter 25,"Value Engineering” ASCE design discipline standards:www.asce.org an effective tool in evaluating constructability,training and educating con- struction personnel,coordinating system interfaces,and eliminating interference. Periodic constructability reviews conducted by the design professional dur- ing the project design phase may reduce problems during construction and help control costs.Often,constructors can be solicited during project design to assist with constructability reviews. 11.3.6 Peer Reviews Peer reviews are examinations of project procedures by independent experts to enhance overall quality.Such reviews are often done by a person or team not directly connected with the project,but with significant relevant expert- ise.Peer reviews are more common,and usually of greater benefit,on proj- ects that involve innovative or unique systems and on large complex projects with potential impacts on the public or the environment.Project owners may contract and pay for peer reviews in a manner similar to the hiring of other technical consultants.Effective peer reviews require that the project sched- ule provide sufficient time for the review and implementation of recommen- dations that are agreed to by the project team. 11.3.7 Alternatives Evaluation and Value Engineering The evaluation of alternative designs and project approaches often helps the team develop economical solutions and improvements.Alternative evaluation also assists in broadening the benefits of a project to serve a wider scope and purpose. Value engineering (VE)is a common process for the systematic analysis of alternatives.VE involves the analysis of alternative designs by outside experts.The VE process provides the owners with an analysis of the costs and benefits of current and alternative project designs,which aid in refining the project design or affirming the existing approach.VE can also be an enhancement to peer and constructability reviews,if qualified team mem- bers participate in the VE study.VE reviews are most effective when con- ducted early in the project. 11.4 COMPLIANCE WITH CODES AND STANDARDS Codes and standards are developed by government agencies,industry asso- ciations,and professional societies to assure the safety and health of project workers,users,and the general public.Local governing bodies may establish additional rules.It is important for the design professional to identify appli- cable codes and standards early in the design process to prevent delays and extra costs from the reworking of plans and specifications to meet these requirements. Specific codes and standards typically address a narrow aspect of design and construction,so the design professional should expect that many different codes and standards would apply to a single project.Codes and standards apply to civil and environmental engineers,electrical engineers,mechanical engineers,structural engineers,and architects. 102 The consistent application of codes and standards to design activities can be difficult,especially for design professionals working in unfamiliar geographic areas or jurisdictions.Local and regional codes are usually based on national codes,but often incorporate local requirements.The design professional can enhance quality and expedite the permitting and approval process by obtain- ing the most recent versions of applicable codes and standards.The designer benefits from a proactive approach in this effort:even if codes and standards appear to be current,the design professional will benefit from inquiring directly about proposed revisions that may take effect while the project is under way. 11.5 REGULATORY PERMITS AND APPROVALS The design professional is required to exercise professional care in produc- ing construction documents that comply with the requirements of regulatory agencies that issue approvals and permits.This care minimizes the potential for delay in the regulatory process. The design professional benefits from developing a written list of assignments and roles in the regulatory process.The agreement for professional services usually assigns the responsibility for obtaining permits to the owner acting with the assistance of the design professional.Proactive attention on the part of the design professional in these activities will benefit the entire project team.The design professional can enhance efficiency and quality with the early identification of the appropriate local,regional,state,or federal regula- tory agencies and their permit requirements.If a project requires a variance from existing regulations,the design professional works with the owner through the appeal or variance process. 11.6 PUBLIC FUNDING Government grants and loan programs are often part of the funding strategy for public projects.However,funding agency procedures and requirements may significantly increase the time and efforts required of the owner and design professional,and may impose limits on project design,construction, or operation.Special public funding requirements may increase construction costs in some cases,beyond the value of the funding assistance itself.It is a benefit to project quality when the design professional,the owner,and prospective funding agencies discuss funding considerations before finaliz- ing the agreement for professional services.This discussion should include an understanding of any limitations attached to the funding. 11.7 DESIGN RESPONSIBILITY Under state licensing laws,the design professional (the person who signs and seals the plans and specifications)is responsible for the design.With his or her signature,the design professional commits the design firm to this same responsibility.Therefore,it is in the interest of the owner and design profes- sional to develop a complete understanding of the extent,degree,and limits of services to be performed.This understanding should be specified to the greatest extent possible in the agreement for design services. 103 >Chapter 7,"Agreement for Professional Services” >Chapter 15,"The Construction Contract” >Chapter 16,"Planning and Managing Construction” When developing the scope of services,it is important that the design pro- fessional be assigned control of design throughout the project,including the construction phase.If possible,the agreement should avoid terms and phrases such as "complete design services,”as they are vague and open to interpre- tation.Instead,the owner and design professional benefit from the use of stan- dard professional association agreements.If nonstandard agreements or contracts are used or requested,the design professional should retain a qual- ified lawyer to review the agreement before signing the document. The authority and responsibility of the design professional during construc- tion should be defined as precisely as possible in the professional services agreement and in subsequent construction documents.For example,safety on the job site,adequacy of formwork,shoring,and similar items are usually the responsibility of the constructor and are beyond the normal control and responsibility of the design professional.The authority and responsibility of the design professional on the construction site to interpret plans and speci- fications,clarify details,correct errors,and review change orders are essen- tial elements of a quality project and are normally provided for in the professional services agreement. SUMMARY Design practice involves office operation,the design professional's relation- ship with owners and constructors,design requirements,and programs for quality.Also included are activities that address codes and standards,regula- tory agencies,and funding agencies.Establishing efficient office practices, observing design quality guidelines,and closely following owner require- ments and regulatory procedures are essential parts of a comprehensive pro- gram to achieve design quality in the constructed project.O 104 Chapter 11:Design Practices Typical Responsibilities Responsibility Design Design- 1)Owner Professional Constructor Builder Manage design office e r Manage design procedures e r Communicate design requirements e@ ©© Conduct design reviews O e@ e@ Estimate construction costs O @ @ e Conduct constructability reviews O ©e e Initiate peer reviews @ t )e Conduct alternatives evaluation and @ e ®oe value engineering Develop and implement design QA/QC r )e@ Comply with applicable design codes O eS e and standards Oversee regulatory compliance t )©@® Comply with public funding guidelines t )©@® Manage overall design O e e @ =Primary Responsibility ©=Assist or Advise ©=Review 105 CHAPTER 7 2 PRE-CONTRACT PLANNING FOR CONSTRUCTION B efore entering into a contract with the constructor,the owner begins devel-oping general plans for construction.This planning does not include spe- cific construction means,methods or procedures,which are primarily the responsibility of the constructor.Instead,this planning focuses on issues that must be addressed before the constructor can begin work at the site. An owner is principally responsible,either by his or her own action or by del- egation to others,for the planning that takes place before the award of the construction contract.This planning also involves the close cooperation of the design professional. This chapter discusses the key aspects of pre-contract planning for construc- tion,including the assessment of the owner's capabilities,the evaluation of resources available for construction,regulatory guidelines,site development, the review of construction alternatives,and contractual arrangements. 12.1 ASSESSING THE OWNER'S CAPABILITIES As project complexity increases,owners tend to benefit from additional assis- tance during each phase of project development-from establishing project objectives through construction completion.In some cases,owners arrange for this assistance by augmenting in-house staff with experienced people who excel at the work to be performed.But when a project requires highly spe- cialized skills and a large number of additional staff,owners usually find that it is more cost effective to engage design professionals and construction man- agers.This is especially true of owners who do not regularly oversee con- struction projects or do not have in-house facilities departments. The owner can enhance project quality by contracting with experienced designers and constructors who have been involved in similar evaluations and decisions on other projects.But before hiring outside experts,owners are advised to begin with an internal evaluation to gauge the number and extent of project activities that can be completed or managed by existing staff.In addition to design and construction tasks,these may include financial,regu- latory,and legal activities. On especially large or complex projects,owners often find the recommenda- tions of a construction management consultant valuable in assessing the capa- bilities of their own organizations-as well as in many of the other activities described in the sections that follow. 107 In this chapter 12.1 Assessing the Owner's Capabilities 12.2 Resources for Quality Construction 12.2.1 Financial Resources 12.2.2 Construction Materials 12.2.3 Manufacturing Capabilities of Suppliers 12.2.4 Human Resources 12.3 Regulatory Requirements 12.4 Site Development 12.5 Reviewing Design and Construction Alternatives 12.6 Construction Contract Arrangements The owner is principally responsible for the quality of planning before the award of the construction contract, 12.2 RESOURCES FOR QUALITY CONSTRUCTION The resources available to the owner,design professional,and constructor strongly influence their respective decisions regarding the project objectives, planning and design,contracting strategies,and construction operations.The following sections discuss four general types of resources and their impact on pre-contract planning decisions:financial resources,construction materi- als,the manufacturing capabilities of suppliers,and human resources. 12.2.1 Financial Resources The owner is responsible for securing the funds to plan,design,build and begin operating the project.The total funding available and the cash flow schedule under which participants are paid are crucial determinants of proj- ect decisions-especially during the conceptual stage.Public agencies,for example,are often subject to regulations regarding the disbursement of funds. Private owners may have necessary financial resources committed to other projects or investments. In some cases,the owner may be unable to provide sufficient funds immedi- ately for initial activities related to the establishment of project objectives and design criteria (i.e.preliminary planning,geological studies,subsurface explo- ration,alternative investigations,and other tasks).Yet adequate support for these pre-contract planning activities is a critical step toward ensuring that project goals and objectives are well defined and that the risk of cost or sched- ule growth from unforeseen conditions is minimized.While cost or schedule surprises are often viewed as a sign of poor design or construction operations, they may actually be a consequence of inadequate financial resources to sup- port the engagement of adequate pre-contract planning activities. Each member of the project team has an interest in the financial health of the other members.Inadequate capitalization can create adverse impacts- such as inadequate staffing,delays in delivery,equipment failure,or short- ages of construction materials-that hamper a participant's ability to deliver quality service. In some cases,design professionals and/or constructors are able to enhance overall project quality by offering the owner financial management and con- sulting services (usually during the early planning stages).On public proj- ects,this may include assistance in determining agency requirements for grants and reimbursement.On private projects,this assistance may include identifying new sources of capital or lines of credit.Some constructors are willing and able to finance the entire project,which allows the owner to wait until the project is ready to begin operating and generating revenue before his or her own financial resources are required. For these reasons and many others,the consideration of financial resources, while a principal activity of the owner during pre-contract planning,has long lasting impacts on the relationships among the team members and their con- tracts with the owner. 108 12.2.2 Construction Materials The cost and availability of construction materials affect planning,design, and construction operations.During pre-contract planning,the project team should consider several questions related to natural materials,including: «What type of foundation is best suited for existing soil and geologic conditions? ¢Can ground conditions be modified for other types of foundations? *How would flooding or erosion affect the construction materials? ¢Is aggregate for concrete available on the local market?Must it be man- ufactured or imported? ¢Are fill materials available on site?What are the other alternatives? *Does the work site influence the choice of materials or method of con- struction (i.e.congested urban area vs.a remote rural location)? Manufactured materials raise additional questions,such as: ¢What materials are readily available at a competitive cost? ¢Will shortage of any basic materials,such as steel or cement,influence design choices or construction means? *Does the choice of materials require extra lead times for critical components? *How do transportation costs,especially to a remote site,affect cost? *How do the storage and preparation of materials at a congested site affect construction operations? ¢Can prefabricated or customized materials,or those produced at a dis- tant facility,be provided in a timely manner? ¢Have sustainable development issues been thoroughly addressed dur- ing the materials selection process? *Are there laws or public support for purchasing materials or equipment locally? *Is the project subject to state or federal "Buy American”legislation? Choosing the right construction materials is a critical process that,by its nature, must be undertaken early in the planning process.The owner benefits from the involvement of as many project team members as possible in the selection process.However,construction materials must often be selected before the constructor is engaged.Therefore,the owner and design professional benefit from consulting with experienced construction management consultants,or by engaging the constructor early (if permissible under any applicable procure- ment laws or regulations),to advise on the selection of materials. If the constructor joins the project team later,he or she may still be able to provide additional insight on appropriate construction materials.Therefore, during the pre-contract planning process,the owner may wish to build time into the construction schedule for the constructor's constructability review to evaluate proposed lead times,construction sequencing,and the compatibil- ity of materials. 109 Estimating and Project Management for Building Contractors,Michael Kitchens,ASCE Press,1996. During pre-contract planning,the owner may wish to allow the constructor time to evaluate proposed lead times,construction sequencing,and the compatibility of materials. Staff continuity improves project quality. 12.2.3 Manufacturing Capabilities of Suppliers During pre-contract planning,the owner and project team address the need for specialized permanent equipment,components,or materials that may require sophisticated or specialized manufacturing.With the assistance,if nec- essary,of specialty advisers,the team reviews and evaluates the manufactur- ing and delivery capabilities of potential suppliers or vendors with respect to several areas,including: *Project specifications and prospective suppliers'specialized manufac- turing capabilities,especially regarding the ability to comply with per- formance specifications and the financial capabilities to support the attendant warranties and guarantees; ¢The potential to meet project delivery demands; *Quality control programs; ¢The potential benefits of independent observation,expediting,and inspection of manufacturing and testing; *The level of detail needed in the procurement documents to be provided to the supplier; *Pre-qualification of firms meeting the manufacturing capability needs. 12.2.4 Human Resources In the initial stages of project planning,the owner evaluates the human resources that could be necessary to successfully complete the effort.Key fac- tors in this evaluation are the continuity of principal professional and man- agement personnel,and the availability of a work force with appropriate skills. In general,staff continuity improves project quality.The owner benefits when the involvement of design and construction staff is consistent.This helps to enhance communication and reduce the effort that must be spent to conquer the "learning curve.”A project team develops an in-depth understanding and familiarity with the effort by working together through pre-contract planning, design,construction,start-up,and operation.When team members know each other and the project objectives well,they are more likely to identify poten- tial problems,resolve conflicts effectively,and reduce the number of change orders that may be necessary. During the initial planning stages,the owner (with the assistance of an expe- rienced construction management consultant,if necessary)estimates the required work force.This may involve discussions with local construction firms,labor unions,vocational training facilities,building contractor associ- ations,and others to determine the availability of skilled craft workers that may be needed.To mitigate potential work force shortages on large projects, the owner may: «Discuss the project in advance with labor unions or trade associations; ¢Modify project facilities (e.g.,including worker housing at remote work sites); 110 Plan for additional construction supervision personnel; Plan for additional quality control measures; *Initiate skills training programs; ¢Incorporate prefabricated elements to reduce the need for on-site labor in cases where sufficient skilled labor is not available. 12.3 REGULATORY REQUIREMENTS Government agency regulatory requirements can have a considerable impact on pre-contract construction planning.Such agencies operate at the federal, state,and local levels.Members of the project team must comply with appli- cable laws and cooperate with agency personnel during each phase of a major project,from conceptual planning through the design and construction phases. The typical areas of agency monitoring and participation include: ¢Job site safety; *Compliance with goals for minority,female,and local residency hiring, and disadvantaged business participation; *Grants and loans guidelines; ¢The use and disposal of hazardous materials; *Environmental impact assessment and evaluation to assist the owner in obtaining the required permits; ¢Public health and life safety laws; *Compliance with state and federal disability accessibility laws; *Building code and disability access enforcement agencies. Some agencies may specify unique requirements for particular projects, depending on their nature and location.The owner and design professional benefit from identifying such special requirements early in the planning process.If special requirements affect the proposed project significantly,the project team can work closely with the agency to identify viable alternative approaches,develop compatible designs,and gain preliminary agency approval. Direct contact with agency officials is a crucial aspect of the regulatory process.The laws,codes,and guidelines under which regulatory agencies supervise projects are often subject to interpretation.Good relationships with regulatory officials can help improve communication and understanding- and keep minor issues from becoming major project slowdowns. Typically,the project owner is responsible for obtaining required permits; for large projects,the owner may assign permit management responsibilities to the design professional and/or constructor. 12.4 SITE DEVELOPMENT Some site development activities may take place during the planning and design phases-before the completion of the construction contract documents. 111 >8.6 "Public Involvement” Regulatory Agencies (partial list) Federal Occupational Safety and Health Administration (OSHA) Environmental Protection Agency (EPA) Federal Highway Administration (FHWA) Federal Transit Administration (FTA) State Departments of environmental pro- tection Departments of capital planning Departments of transportation Local Regional!or metropolitan planning authorities City departments of transportation >Chapter 8,"Alternative Studies and Project Impacts” These activities include: ¢Constructing access roads and rail sidings; ¢Extending utilities to the site; ¢Constructing independent utility systems,if required; *Constructing temporary buildings and other facilities; *Setting up construction laydown areas and fabrication yards; ¢Planning for traffic control; ¢Developing traffic detours; *Relocating utilities,highways,rail,and other facilities. Construction contracts for road and utility work may be issued before (and separately from)the contract for project construction.Utility extensions and relocations may need to be done by the utility company affected though it is often cost effective to include utility work in the main construction package. Site development work may also be included in the main construction con- tract,though many considerations,such as scheduling,site congestion,con- struction sequencing,and cost,must be addressed as part of pre-contract planning.Site development also affects the timing of contract awards. 12.5 REVIEWING DESIGN AND CONSTRUCTION ALTERNATIVES The owner's consistent involvement in the review of design and construction alternatives is one of the most important aspects of pre-contract planning.At appropriate points in the evaluation of project alternatives,the project team reviews alternatives with regard to several crucial considerations: ¢Estimated cost; ¢Schedule; *Quality; *Construction sequencing; ¢Plant or equipment layout; ¢Sustainable development issues; *Constructability; ¢Safety; *Construction work plans. As the project moves forward,the team conducts reviews that are more detailed and modifies designs where appropriate and practical.Special con- struction concerns are noted in the contract documents.The design team's documentation of the owner's involvement and of all material decisions made regarding alternatives adopted is a critical aspect to the planning process. 112 12.6 CONSTRUCTION CONTRACT ARRANGEMENTS The last major pre-contract planning activity is the establishment of con- struction contractual arrangements.The owner,as the principal project advo- cate,is responsible for establishing the construction contracting strategy.In general,effective construction contracting strategies: 1.Meet the owner's project goals and objectives 2.Reflect the owner's capabilities 3.Specify the responsibilities of the design professional and constructor SUMMARY Pre-contract planning is an investment for quality construction.By exploring the range of issues that can affect construction,the owner can minimize or eliminate many potential obstacles that drive up project costs or create delays. Pre-contract planning is a fluid process;project objectives are often still being developed,new members of the project team are coming on board,informa- tion is often not complete,and a host of other variables may still be in play. Therefore,the owner's investment involves both time and financial resources. The owner is at the center of pre-contract planning activities.The owner holds primary responsibility for nearly all related activities,including the evalua- tion of his or her own capabilities.While many owners rely on the experi- ence of the design professional for assistance with these tasks,the quality of large or complex projects may be improved when the owner seeks the advice and services of a construction management consultant.O 113 >Chapter 3,"Project Delivery Systems” >Chapter 7,"Agreement for Professional Services” >Chapter 15,"The Construction Contract” Chapter 12:Pre-Contract Planning for Construction Typical Responsibilities Responsibility Design Design-ig}Owner Professional Constructor Builder Assess owner capabilities e@ e @)e@ Secure financial resources*e@ ®©© Assess construction material needs e 'O)@ e@ and availability Evaluate supplier capabilities r O)e e@ Evaluate human resource needs @ @®@®© and availability Address regulatory requirements*@ r )e@ Address permitting requirements e@ 'O)@®© Address site development issues e@ e e@ r ) Address sustainable development @ e@ rT e concerns Review design and construction t e@ e@ r alternatives* Define contractual arrangements @ O O O *Often in process or completed prior to pre-contract planning @ =Primary Responsibility |©=Assist or Advise ©=Review 114 CHAPTER 1 3 THE CONSTRUCTION TEAM he construction team is the group of people who work together to build the project.This chapter discusses how the construction team is assem- bled,the role of the agreements in organizing the team,construction team site representatives,and the value of construction specialty advisers. As with the other phases of a project,construction involves the coordinated efforts of skilled individuals who have access to adequate resources.The owner,design professional,and constructor form the core of the construction team,though these roles may vary if design-build or other delivery systems are utilized. The owner has the unique responsibility of selecting the team members who participate during construction (as well as previous project phases).The proj- ect goals and objectives guide the owner's decisions about the degree and fre- quency to which team members participate during construction,as well as the presence of team representatives at the work site itself.The construction team may include participants from outside the core team,including representa- tives of regulatory agencies,subcontractors,suppliers,and specialty advisers. In general,the greater the number of participants,the more important it is that team members understand their roles and responsibilities.Regular,clear, effective and efficient communication among team members will add signif- icantly to such understanding.Partnering programs may also be valuable in achieving this goal. 13.1 ASSEMBLING THE CONSTRUCTION TEAM The process of assembling the construction team actually begins before the constructor is engaged.The owner's decisions during the conceptual phase of the project,as well as those made during planning,design,and the prepa- ration of construction contract documents,shape the performance expecta- tions and personnel needs of the construction team.By the time that the owner and constructor sign a contract and begin designating and assigning con- struction roles,many fundamental assumptions about the composition of the team are already in place.These may include the designer's degree of involve- ment in the construction phase,as well as the number of personnel that the owner and constructor will have on-site. Before selecting a constructor,the owner and design professional work together to formulate a plan of construction activities.For relatively simple projects,the owner may have the necessary in-house expertise to develop a 115 In this chapter 13.1 Assembling the Construction Team 13.2 Contracting Strategies and Team Organization 13.3 On-site Construction Team Representatives 13.3.1 Owner's Representative 13.3.2 Constructor's Construction Site Representative 13.3.3 Design Professional Construction Support Services 13.3.4 Regulatory Agencies 13.3.5 Subcontractors and Suppliers 13.4 Construction Specialty Advisers >Chapter 2,"The Owner's Role and Requirements” >Chapter 24,"Partnering” >Chapter 12,"Pre-Contract Planning for Canstruction” The contracting strategy, or project delivery method,strongly influences the composition and organization of the construction team. >Chapter 15,"The Construction Contract” >Chapter 7,"Agreement for Professional Services” successful construction plan.However,for most large projects,the owner ben- efits by seeking construction planning assistance from the design professional or an experienced independent construction planner.The constructor,if selected at this point in the project development,may also review the design and planning work related to construction operations. The owner's selection of the constructor under design-bid-build contracting takes place in one of two ways.For public projects,the owner typically places advertisements in leading industry publications with a request for proposals (RFP)or solicitation for sealed bids from prospective constructors for proj- ect construction.On private projects,the owner may extend an invitation to bid to a selected list of pre-qualified construction firms.Although many gov- ernmental agencies by law must engage in open bidding and award proce- dures,public projects may involve pre-qualification procedures,as well.This procedure provides constructors an opportunity to demonstrate their capabil- ities,record of experience,previous performance,financing capability,avail- ability of professional talent,and access to necessary construction equipment to the owner. 13.2 CONTRACTING STRATEGIES AND TEAM ORGANIZATION The contracting strategy,or project delivery method,strongly influences the composition and organization of the construction team.The owner is responsible for establishing the contracting approach,usually during the planning phase. Contracts define the responsibilities that the construction team participants are expected to fulfill.Therefore,contracts are fundamental tools in helping teams avoid conflict.Good contracts clearly define the scope of work,the roles of participants,expectations for coordination and communication,divi- sions of authority,and other relationships. In developing the construction contract provisions,it is in the owner's inter- est to clearly specify: ¢The responsibilities of the constructor and the owner; Fair and equitable arrangements among the team members; *The participation of qualified personnel; *Procedures for timely payment of invoices; Approval procedures for contract change orders; Procedures for enforcing contract terms and conditions. In addition to the construction contract and the contract documents,the pro- visions of the owner-design professional agreement define the scope of serv- ices to be provided by the design professional during the construction phase. The construction contract and contract document provisions relating to the role and responsibilities of the design professional must be consistent with the terms of the owner-design professional agreement. 116 Figure 13-1 Typical Construction Team Organizational Chart OWNER Owner's Resident Project Representative F (RPR) Design Professional [77 Constructor sSupport=Construction 'Supervisor Material and Support Craft ;QualiEquipmentServicesSuerintendents|?Subcontractors ContralSuppliersP; -Lines of authority (defined by contract) ---Lines of communication A variety of contracting arrangements are available to the owner to define appropriate lines of authority among construction team members.While some owners still prefer to organize their teams according to a traditional organi- zational chart with the design professional and constructor reporting directly to the owner (see Figure 13-1),many owners now favor a less hierarchical organizational structure to promote cooperation and collaboration. 13.3 ON-SITE CONSTRUCTION TEAM REPRESENTATIVES Safe and productive construction operations depend on the presence of appro- priate team representatives at the construction site.The constructor is respon- sible for construction site activities and usually for safety (as designated by the owner),and therefore generally controls access to the work site during all phases of construction.The size and complexity of the project determine the frequency of visits and monitoring by the owner and designer to evaluate whether the permanent work,when completed by the constructor,will com- ply with the requirements of the contract documents.In many cases,the owner and design professional do not need to be at the construction site all the time for that purpose.In addition to requests by team participants,the contract may specify intervals for observations or site visits by the owner and design professional. 13.3.1 Owner's Representative The owner's representative is a key member of the construction team.This person may be the owner,a senior member of the owner's staff,a member of 117 the design professional's staff (a resident engineer),a member of the con- structor's staff (typical under the design-build approach),or an independent construction manager retained by the owner.The owner's contracts with the design professional and constructor specify the type of owner representation, as well as the level of on-site authority and responsibility for each participant. The owner benefits from designating his or her representative as early as pos- sible so that this person is able to develop a factual understanding of project goals and objectives.An early assignment will also help establish an "insti- tutional memory”of key decisions,strategies,and procedures,and provide an opportunity to develop sound and constructive relationships with other team representatives.Early selection also allows the owner's representative to contribute during the planning and design phases and offer feedback about site operations.Key qualifications for the owner's representative include a familiarity with the owner's organization and values,experience in relevant types of construction,and the ability to communicate project goals and objec- tives clearly. The general responsibilities of the owner's representative include: *Representing the owner at the construction site; *Mediating conflicts at the construction site; *Administering the owner's contracts with the constructor,design pro- fessional,and others; ¢Reviewing and evaluating deviations from the schedule; ¢Reviewing and approving invoices,and processing them for payment; ¢Reviewing and approving construction contract change orders,and pro- cessing related documents; ¢Supervising other owner personnel at the construction site; ¢Communicating appropriately with regulatory agencies to ensure com- pliance with relevant laws; *Conducting periodic progress meetings; ¢Managing the communication process with the public and others as needed; «Managing project financing. 13.3.2 Constructor's Construction Site Representative The constructor's lead employee on the work site is the construction site rep- resentative.Depending on the size and complexity of the project,this posi- tion may be held by a project manager,superintendent,or foreperson.The construction site representative works to achieve the project objectives,as specified in the contract with the owner,by carrying out general duties that include: ¢Representing the constructor at the site; ¢Providing the owner's representative with the submittals specified by the contract; 118 ¢Managing the execution of work per the terms of the construction con- tract (usually including activities such as scheduling,sequencing oper- ations,expediting labor resources and materials,and coordinating the various trade contracts); ¢Arranging for licensed professionals to design temporary facilities not included in the plans and specifications,such as shoring,scaffolding, cofferdams,river diversions,traffic maintenance,or other facilities; *Making appropriate submittals for temporary facilities to the owner, designer,and regulatory agencies; ¢Managing subcontractors,suppliers,and construction craft workers; ¢Arranging for timely payment of subcontractors,suppliers,and the con- structor's employees; «Managing the constructor's quality control program; *Managing job site safety (as delegated by owner); *Complying with legal,contractual,and regulatory obligations. 13.3.3 Design Professional Construction Support Services In addition to completing the project plans and specifications,the design professional is usually expected to provide support services on behalf of the owner during construction.Such services often include some on-site moni- toring to verify progress toward project objectives.This support is usually specified in the design professional's agreement with the owner.Under design- bid-build,the design professional does not usually have a contractual relationship for construction-phase services with the constructor. The design professional's construction representative may assist the con- struction team in resolving minor design-related concerns,though larger design matters may need to be resolved with the active participation of the owner and constructor team representatives-or even the principal members of the team.The design professional's experience is often valuable in resolv- ing certain disputes concerning the meaning or intent of the drawings and specifications,as well as the quality of the constructor's work.The design professional also typically certifies the constructor's pay requests. The portions of the design professional's contract with the owner that are related to construction support generally assign the design professional the following authorities and responsibilities: *Clarifying and resolving technical questions about plans and specifica- tions in response to requests for information (RFIs); ¢Reviewing contract change orders from a technical viewpoint; *Reviewing and commenting on technical data,including shop drawings; ¢Coordinating technical questions with regulatory agencies; *Evaluating alternatives and proposed substitutions,and making recom- mendations to the owner; ¢Observing construction when specified by contract or law. 119 ASCE Policy Statement 350 "Construction Site Safety” 13.3.4 Regulatory Agencies During the course of construction,representatives of federal,state,and local government agencies may inspect or be assigned to observe the construction site.These representatives and inspectors are responsible for assessing the construction team's compliance with applicable building codes,laws,rules, permits,and regulations to ensure safety,public health,and environmental protection.These agencies are responsible for enforcing compliance with a wide range of regulations,from job site safety,to hazardous material disposal, to environmental protection and insurance. The various agencies and individuals that may work with the construction team,depending on the size and scope of a project,include: ¢Municipal building code and standards inspectors; ¢The Occupational Safety and Health Administration (OSHA); ¢The U.S.Environmental Protection Agency (EPA); ¢State and city departments of environmental protection; ¢Water and wetlands agencies; ¢Air quality agencies; ¢State and local fire safety officials; ¢Food and Drug Administration (FDA); *Local and state health-care facilities approval agencies; *Local and state boards of health. The construction team can avoid delays and extra cost by working with the owner and designer to identify the regulations that are likely to apply to the project,submitting certificates and documentation in a timely manner,and maintaining records of compliance. Other agency personnel may wish or need to visit the work site to observe progress as a matter of public interest,especially if the project involves the expenditure of public funds under grant programs,nuisance abatement under court orders,or potential public health and safety concerns.Good communi- cation with agency personnel and prompt compliance with regulations will improve project quality and promote overall team cooperation. 13.3.5 Subcontractors and Suppliers In addition to construction workers,who may be members of the construc- tor's staff,union craft laborers,or independent hires,the constructor typically engages subcontractors and suppliers to complete specific construction tasks. The constructor often relies on subcontractors to provide skilled construc- tion craft labor to augment the project work force.Suppliers provide the mate- rials,from lumber and concrete to sophisticated electronics,that are used to assemble project facilities.Suppliers may provide limited site labor,usually to deliver materials or set up equipment. 120 General responsibilities of subcontractors and suppliers include: ¢Providing qualified labor and supervision; ¢Preparing appropriate submittals relating to their work,products or materials; ¢Supplying materials that meet the specifications of the contract documents; ¢Coordinating work and deliveries with the construction schedule; ¢Supporting and complying with the constructor's quality control and job site safety programs. Though subcontractors and suppliers may not have direct contractual rela- tionships with the owner,the performance of these participants directly affects the ability of the construction team to achieve the owner's project objectives. Many construction teams now include subcontractors and suppliers in part- nering programs and other quality assurance efforts to improve coordination among "second tier”construction team members. In many states,lien laws require that the constructor inform the project owner of the existence of subcontractors or suppliers.Contracts with the owner may also stipulate this disclosure. 13.4 CONSTRUCTION SPECIALTY ADVISERS The construction team may benefit from the assistance of additional profes- sionals with special expertise.The owner,design professional,and construc- tor may separately retain advisers or consultants on matters of law,insurance, public relations,safety,and other specialties.The close contact of the owner's representative with specialty advisers may help the construction team resolve problems quickly and avoid constructor claims,litigation by outside parties, citations by regulatory agencies,labor disputes,or public misperceptions. Expert advice is often cost-effective,helping to speed contract completion and enhance overall project quality. SUMMARY The cohesiveness of the construction team affects project quality in many areas,from completing the project on schedule and within the established budget,to ensuring the safety and functionality of the facility,to protecting the environment and meeting regulatory obligations. The owner is responsible for selecting the other members of the construction team,and achieves a quality project by seeking participants with the skills and capabilities to meet the project objectives.In many cases,the owner ben- efits from working closely with the design professional and,if the size and scope of the project merit,seeking the advice of independent and trusted con- struction experts in assembling the construction team.The relationships estab- lished during the formation of the construction team will endure throughout the life of the project.O 121 >Chapter 24,"Partnering” Chapter 13:The Construction Team Typical Responsibilities Responsibility Design Design-ig Owner Professional Constructor Builder Establish contractual arrangements r )@)O)© Designate construction site r )e e@ @ representatives Monitor regulatory compliance eo @ r r } Coordinate subcontractor and O @)e e@ supplier participation Engage construction planning specialty @ @ @®© advisers Overall responsibility for selecting r ©©© construction team @ =Primary Responsibility @)=Assist or Advise ©=Review 122 CHAPTER T 4 PROCEDURES FOR SELECTING THE CONSTRUCTOR he selection of a qualified constructor for a competitive cost is an owner responsibility that significantly influences project quality.To choose a constructor,the owner formulates and uses selection procedures that deter- mine the constructor's ability to produce the desired results.In some cases, this may include setting pre-qualification criteria for constructors. The owner generally seeks assistance in constructor selection from the design professional,legal counsel,and other advisers.The role of the design pro- fessional in constructor selection centers on preparing,for the owner's approval,the bidding package.This package includes the contract documents that define the project,as well as the procedures for submitting price com- petitive bids or proposals.The design professional may also assist the owner in administering the bidding process,evaluating the bids or proposals received, and awarding the contract. Many competitive bidding procedures are described in documents prepared by professional organizations,industry associations,and government agen- cies.These procedures,recommendations,laws,and regulations are usually structured for competitive bidding of public work.Using public works pro- cedures as a base,other procedures,such as competitively priced proposals and competitive bidding by a select list of bidders are discussed in this chapter. Constructors are motivated to bid projects,both public and private,if the risk allocation provisions in the bid documents are fair,clearly stated,and dili- gently followed. 14.1 SELECTION PROCEDURES AND QUALIFICATIONS The owner,typically assisted by the design professional and other advisers, formulates a procedure to attract and evaluate interested constructors.This procedure for selecting the constructor may be informal or highly structured, depending on the size and complexity of the project and the owner's organi- zation.Private-sector owners may award construction contracts on the basis of prices offered informally,even orally,by constructors known to them. However,most public agencies are required by law to use competitive bid- ding for construction contracts. The first step in the selection procedure,either public or private,may be to invite constructors to submit information about their qualifications in the form of a statement of qualifications (SOQ).The invitation can be either a public notice or private invitation.The tailoring of the qualification appraisal will 123 In this chapter 14.1 Selection Procedures and Qualifications 14.2 Constructor Qualifications 14.3 Selection by Competitive Bidding 14.3.1 Role of Design Professional 14.3.2 Competitive Bidding for Public Works 14.3.3 Owner's Bidding Procedures for Public Works 14.3.3(a)Prior to Bid Opening 14.3.3(b)Bid Opening 14.3.3(c)After Bid Opening 14.3.3(d)Contract Award 14.3.4 Competitive Bidding for Private Work 14.4 Selection Procedures for Competitive Negotiated Contracts 14.5 Selection Procedures for Noncompetitive Negotiated Contracts Associated General Contractors of America: www.agc.org Design-Build Institute of America:www.dbia.org vary,depending upon the site and complexity of the project and any special skills,experience,or equipment required. In general,competitive bidding for public projects requires the following qual- ifications of constructors submitting bids: *Valid state and local license(s)to perform the work; *Proof of financial capability to enter into contract,as evidenced by the ability to supply bid and performance bonds. However,public agency regulations may permit a more restrictive prequali- fication if the project requires specialized construction techniques,is on a crit- ical schedule,or has special characteristics regarding protection of the environment and safety of work. The following is a general checklist of pre-qualification information that may be requested by the owner: ¢Constructor name,location,license,¢Safety records:written program, and corporate structure,if applica-actual experience. ble.*Quality control:written program. *Business data:financial information,.Resumes of key executive and super-bonding capacity,bank references.visory staff. *Construction experience:projects ¢Current work load:remaining bond-constructed or under construction,ing capacity.size,type,performance on schedule,¢Personnel to be assigned to key posi- tions of management and field*Work force on constructor payroll supervision.versus subcontracting. and budget. ¢Performance of completed project:*Equipment owned versus rentals.references. ¢Record.of litigation. The Associated General Contractors of America (AGC)has prepared a preprinted form,"Construction Contractor's Qualification Statement for Engineered Construction”(AGC Doc.220),for use as a suggested generic prequalification statement or a contract-specific qualification statement. Guidance for the presentation of design-builder qualifications may be found in the Design-Build Institute of America's "Design-Build Contracting Guide” (Doc.2215). In examining and evaluating the information submitted,the owner may,in addition to checking the references supplied by the constructor,make inde- pendent checks on the constructor's credit standing,visit projects completed and interview owners and operators,investigate safety and litigation records, and review other indicators of performance capability. 14.2 CONSTRUCTOR QUALIFICATIONS After the submittal and confirmation of constructors'qualifications,the owner is ready to proceed with selection of a constructor.Private owners may choose 124 the constructor or design-builder that they consider the best qualified. Alternatively,the owner may use the qualification information to develop a "short list”of pre-qualified constructors who are asked to: *Bid competitively for the work on a unit-price or lump sum basis; *Present priced proposals for negotiation of a contract on mutually acceptable terms. If the owner is a public agency,the analysis of the qualifications information may be used to select a short list for submittal of priced proposals. If pre-qualification information is not being requested from constructors,cri- teria may be set by the agency for qualifying bidders in terms of experience, size,licensing,work load,specialized expertise,financial status,and other qualifications appropriate for the construction of the project. 14.3 SELECTION BY COMPETITIVE BIDDING Two ingredients for true price competition bidding are:clear,concise set of construction plans,specifications,and other proposed contract documents; defined procedure for the bidding and award process. The contract documents specify the product to be delivered by the construc- tor.The bidding procedure protects the owner as well as the bidders by pro- viding a systematic approach to bidding and awarding the contract. 14.3.1 Role of Design Professional The design professional's degree of involvement in the bidding process depends on the agreement for professional services with the owner.The nature and extent of this agreement are influenced by the owner's staff size and capa- bility.In a typical arrangement,the design professional: *Prepares drawings,specifications,bidding documents and other con- tract documents as well as estimates of probable cost for the review and approval of the owner,the owner's legal counsel,and other advisers; ¢Assists the owner in obtaining bids or priced proposals for each sepa- rate contract to be awarded; «Assists the owner in evaluating bids or proposals and in awarding contracts. The general responsibilities of preparing documents for the bidding process and performing activities are outlined in standard procedures by a variety of professional organizations. 14.3.2 Competitive Bidding for Public Works Competitive bidding is a frequently used constructor selection method for federal,state,and local government projects.For these types of projects,the use of competitive bidding is usually mandated by law or agency regulations. This mandate reflects a legislative body's opinion that competitive bidding for construction contracts provides value to the taxpayers and fairness to the 125 Competitive Bid Web Resources Wy)rrrFSAIA:www.aiaonline.org EJCDC:www.acec.org/ business/ejedcdoc.htm ACEC:www.acec.org AGC:www.agc.org APWA:www.apwa.org Management of Public Works Construction Projects, Section 16,"Bidding,”James L.Martin,American Public Works Association,1999. construction industry when spending major sums for capital programs.The goals of value and fairness are met when the integrity of the bidding process is preserved. Beyond the general mandate for competitive bidding,there are numerous spe- cific rules and criteria that may affect public owners during the constructor selection process.The information required for typical bidding and award of a public construction contract is defined by the set of documents issued to prospective bidders.These documents generally include: ¢Bidding documents that apply to the bidding process,including:the invitation to bid (legal notice),instructions to bidders,information for bidders,and bid forms.Bidder qualification data may be a part of the bid submittal if proof of valid licensing and bonding capacity is all that is required.If constructor prequalification is used as a means of devel- oping a list of qualified bidders,this activity occurs before the start of the conventional bidding procedure. *Contract documents specify the constructor's performance on the proj- ect and generally include the owner/constructor agreement,perform- ance and payment bonds,the bid or proposal,general conditions, supplementary conditions,specifications,drawings,addenda issued dur- ing the bidding period,and change or extra work orders. 14.3.3 Owner's Bidding Procedures for Public Works The procedures required to solicit and inform bidders,to receive and analyze bids,and to award contracts under a competitive bidding system include the following actions prior to the bid opening,during the bid opening process, and after bid opening.These activities are conducted by the owner,assisted by the design professional,legal counsel and other advisers. 14.3.3(a)Prior to Bid Opening ¢Receive and evaluate constructor qualifications if a prequalification of bidders is part of the process. *Invite qualified constructors to bid on the project through legal notices and other advertisements,direct mailings,and notices to trade publica- tions and accredited plan rooms. *Set bid-opening time and date to allow sufficient time for constructors to make accurate quantity takeoffs,conduct site investigations,obtain subcontractor prices,determine material and equipment costs,and take whatever action is necessary to prepare a unit price or lump sum bid. ¢Arrange for distribution of bidding and contract documents to interested bidders,accredited plan rooms,and other viewing locations. ¢Maintain a current list of document holders. ¢Make appropriate arrangements so that prospective bidders may have access to the site. ¢When appropriate and practical,hold a pre-bid conference at the site to answer inquiries on and clarify provisions of the bidding documents. The pre-bid conference is not used to convey information in addition 126 to that contained in the bidding documents.The constructor and owner are held responsible for what is in the written documents,not the con- versation at the pre-bid conference.If clarification is required,an adden- dum is issued to all document holders. Issue addenda to all document holders of record.If an addendum is required,and cannot with certainty reach all prospective bidders in time to permit adjustments in the bid to be submitted,the bid opening may be postponed. 14.3.3(b)Bid Opening Require that all bids be dated and time stamped when received at the bid opening location.Late bids should be returned unopened. Open bids at a public meeting where they are read aloud. Check bid submittals for presence and amount of bid security,acknowl- edgment of receipt of all addenda,presence of required documentation. Make original bidding documents available for inspection in the pres- ence of the bid-opening official. Safeguard bids for later evaluation. 14.3.3(c)After Bid Opening Prepare bid tabulations and make information available to interested parties. Verify and analyze qualification data submitted with the bids. Confirm compliance with other requirements of bidding documents. Take appropriate action with advice of legal counsel in rejecting non- conforming bids. Take appropriate action with advice of legal counsel in permitting with- drawal of bids by bidders claiming errors in bid preparation. Analyze price bids (compare to estimate of probable cost),supporting information,and documentation,using criteria set forth in bidding instructions,and determine lowest responsive,responsible bidder. Reject all bids if constraints of budget,schedule,or other critical ele- ments cannot be met. 14.3.3(d)Contract Award When required,obtain approval of federal or state agencies adminis- tering grants and/or loans. Make award within the time specified in the bid documents (AGC rec- ommends a maximum of 75 days after bid opening.)If the time must be extended,a written approval from the selected bidder is required. Prepare a notice of award,forwarding multiple copies of the contract documents for the successful bidder's signature.The notice of award allows a certain period of time for the constructor to sign the documents and return them along with executed bonds,certificates of insurance, and other required documentation. Have owner sign and execute contracts,and issue notice to proceed with the work. 127 Best Value Contracting: Best value contracting Is a rela- tively new process used in compet- itive negotiated contracting to select the most advantageous offer by evaluating and comparing fac- tors in addition to cost or price. *Carefully observe procedures,rules,and regulations that protect the integrity of the bidding process,provide fair and equal treatment of bid- ders,and give the public agency owner fair prices from the competitive process. 14.3.4 Competitive Bidding for Private Work The private sector owner may elect to follow essentially the same procedures in securing competitive bids as has been outlined for the public sector.The owner may invite a broad spectrum of the construction industry to participate, or may limit participation to a select bidders list chosen by prequalification. In either case,the owner and bidders rely on defined bidding and contract documents,generally prepared by the design professional,to provide mutual understanding of the project and to set rules and procedures for competitive bidding and award of contract. 14.4 SELECTION PROCEDURES FOR COMPETITIVE NEGOTIATED CONTRACTS Situations occur where structured price bidding may not be appropriate.In these situations,the owner first compares the qualifications submitted by inter- ested constructors.The owner selects the constructor best qualified for the project,according to established criteria,and then negotiates a contract for project construction with that firm or person.This approach generally results in some form of reimbursable cost-plus-fee contract,although negotiated lump sum or unit-price arrangements are not precluded. If competition more directly related to construction or design-build services is desired,the owner selects a list of constructors on the basis of qualifica- tion analysis.The owner then solicits proposals from constructors on the list to address certain topics defined by the owner.These topics typically include: *Project understanding; ¢Approach to unique project ideas in the work plan; *Organization of project activities-services proposed; «Proposed schedule,with milestones; ¢Programs for safety,quality control,design,and use of temporary structures; ¢Availability of crafts,use of subcontractors,minority involvement; ¢Use of local resources; *Business information-wage and salary costs,overhead costs,con- tracting policy,insurance,and other related items; ¢Project budgets by components of the work; *Proposed cost of work-unit-price,lump sum,reimbursable cost-plus fee; *Key management and supervisory personnel to be assigned to the project. 128 With this information available,the owner makes an evaluation of the orga- nizational and cost elements of the work and negotiates a contract with the constructor judged to have the best overall proposal. 14.5 SELECTION PROCEDURES FOR NONCOMPETITIVE NEGOTIATED CONTRACTS Under certain circumstances the owner may select a specific constructor and negotiate the contract.Situations where this procedure applies include: ¢The owner may choose the constructor based on the constructor's sat- isfactory performance on work previously done for the owner; *The constructor may have unique qualifications for the work to be accomplished; *The constructor is already working at the site; ¢The urgency of the situation requires immediate action.(For example, damage control,restoration of failed utilities,protection against flood or other natural disaster.) In the case of sole source award of a contract by a public agency,the con- structor may have unique characteristics,such as a record of successful busi- ness relations with the owner,specialized expertise not available elsewhere, or is available immediately to handle an emergency. SUMMARY Project quality depends in large measure on the ability of the constructor to conscientiously follow the plans and specifications to complete the con- struction of project facilities safely,on time,and within budget.With these responsibilities in mind,the owner formulates a selection procedure that emphasizes the evaluation of constructor qualifications.The owner evaluates these qualifications and makesa list of pre-qualified bidders or proposers who are most likely to be capable of completing the project successfully.The design professional generally assists in the constructor selection process. Public agencies typically use fair and impartial,though sometimes exten- sive,bidding procedures that focus on the requirement to obtain a competi- tively low price for construction from a responsible bidder.Private sector owners may use less rigid selection procedures,often soliciting bids from a pre-selected list of constructors.The competitive bidding process usually results in the award of the contract to the most qualified bidder with the low- est unit-price or lump sum bid.Constructors may also be selected on the basis of competitively priced proposals or by a sole-source selection process. Up-to-date versions of constructor selection recommendations and guidelines are available from many construction industry organizations.O 129 Chapter 14:Procedures for Selecting the Constructor Typical Responsibilities Responsibility Design Design-ig Owner Professional Constructor Builder Adopt bidding procedures e@ © Request constructor's qualifications @ @ Prequalify bidders e © Provide plans and specifications O @ Prepare contract documents O @ Request submittal of bids/proposals @ © Prepare and submit bids @®'O)@ e@ Receive and evaluate bids e@ @® Evaluate bidders/proposers if e © pre-qualifications not used Select qualified constructor e@ 0) Select alternatives e@ @ Execute construction contract @ @ @ e@ @ =Primary Responsibility @®=Assist or Advise ©=Review 130 CHAPTER 7 5 THE CONSTRUCTION CONTRACT he construction contract documents-the contract and its attachments-__In this chapter define the agreement between the owner and the constructor.Under 15.1 Functions of the Construction traditional design-bid-build (DBB)project delivery,the construction contract Contract Relating to Quality is a two-party agreement that does not include the design professional.15.2 Role of the Design However,the design professional may provide professional services related Professional in the to construction at the owner's direction during construction.Construction Contract 15.3 Defining and Preparing the In a design-build project,the design-build firm contracts to perform both con-Construction Contract struction and design services.However,the basic elements of the traditional Documents DBB construction contract,as described in this chapter,remain at the core of 15.4 Industry Standarddesign-build agreements.Other project delivery systems (described in Construction Contract Chapter 3)involve design-build variations.Therefore,it is important that the Documents construction contract,whatever form it may take,accurately documents a "meet-15.5 International Construction ing of the minds”;states clearly the roles and responsibilities of the parties with-Contracts out overlaps or voids;and aims squarely at achieving a quality project. 15.1 FUNCTIONS OF THE CONSTRUCTION CONTRACT RELATING TO QUALITY The construction contract serves several important functions from the begin- 'ning to the end of a project.It defines the rights and responsibilities of the owner and the constructor,ranging from the specific quality requirements in the specifications and plans to the owner's obligations to make decisions and payments in a timely manner.Additionally,the contract documents set forth procedures and requirements for management and administration of the contract,such as schedules,shop drawings,and inspections.In this con- text,the contract documents can be considered a procedures manual to help ensure quality. Another important but sometimes overlooked role of the construction con- tract is that of a planning tool for quality.That is,the parties preparing the contract documents can look to the various components to help ensure that appropriate attention is given to quality.This could range from specification requirements for materials or workmanship to procedural requirements such as submittals and inspections. The construction contract documents also support a structured planning process in their role as a risk management plan and risk allocation device. Finally,of course,there is the legal function.Contract rights and responsi- bilities are enforceable in our legal system.This provides certainty to both parties that the other party will perform in accordance with the terms of the 131 >Chapter 17,"Construction Contract Documentation and Submittals” contract,which if prepared with appropriate quality requirements will result in a quality project. 15.2 ROLE OF THE DESIGN PROFESSIONAL IN THE CONSTRUCTION CONTRACT Under traditional DBB project delivery,the construction contract is a two- party agreement between the owner and the constructor.However,it may include a description of the various services and functions the design profes- sional may provide during construction.The design professional may also have a major role in preparing many of the contract documents and compil- ing documents for use by bidders and the parties. The basic components of the traditional DBB construction contract,as described in this chapter,remain at the core of design-build agreements.The contract documents will also include design criteria,performance specifica- tions,or outline specifications (or a combination thereof)prepared by the owner or a firm specializing in the preparation of design-build procurement documents (often a design professional)as well as the design-builder's pro- posal.Other project delivery systems (see Chapter 3)may involve other variations. 15.3 DEFINING AND PREPARING THE CONSTRUCTION CONTRACT DOCUMENTS Typically there are several separate components to the construction contract documents.Each should be clearly listed in the agreement signed by the par- ties.These documents supersede any prior oral or written agreements (par- ticularly if there is a contract clause stating this). Construction contract documents generally include: *The agreement (the document signed by the parties,which customar- ily identifies the parties,states the contract price,payment terms,and contract time,and lists the contract documents); ¢General conditions; *Supplementary conditions; ¢Drawings; *Specifications; ¢Addenda (if any)issued before bid submittal; ¢Notice to proceed; *Performance and payment bonds (if any); ¢Change orders or contract modifications (post-execution). Preparation and assembly of the construction contract documents for review and approval by the owner and his or her legal counsel may be done by the owner's staff or a third-party design professional,or a combination. Sometimes the contractor or the design-builder may submit a contract to the owner.In any case,preferably a team of individuals knowledgeable about 132 the project and contract documents will work together to produce a contract that accurately reflects the intent of the parties. Because the contract documents are the key to defining quality requirements, it is important to denote the preparation effort necessary to produce quality contract documents both individually and as an integrated "package.”Quality contract documents will help provide quality in constructed projects.It is essential that attention be given to a careful review of all of the documents to help assure coordination and consistency,i.e.,avoid gaps and conflicts,the source of many misunderstandings and disputes. "The Guide to Uniform Location of Subject Matter and Information in Construction Documents,”a joint publication of the American Institute of Architects (AIA Doc.521)and the Engineers Joint Contract Documents Committee (EJCDC Doc.1910-16),addresses the question of where to place or find a specific subject in contract documents,offering a uniform approach to the organization of contract documents.It also serves as a comprehensive checklist of items to be included in the construction contract. 15.4 INDUSTRY STANDARD CONSTRUCTION CONTRACT DOCUMENTS Several components of the construction contract documents may be avail- able as standard forms,to be completed or edited to define the agreement for a particular project.These standard forms typically include the agreement form,general conditions and surety bond forms.The benefits of standard forms include efficiency in preparation as well as efficiency in bidding.Large public and private owners,design professionals,and constructors may have their own individually drafted standard contract forms.However,such forms may not always document an appropriate allocation of risk.They may also include potentially unenforceable contract provisions,archaic terms and pro- cedures,and internal conflicts. Professional organizations and industry associations offer important advan- tages by promoting the broad use of standardized contract content,forms,def- initions,and language.EJCDC (a joint venture of ASCE,ACEC,and NSPE) along with AIA,AGC,and DBIA have developed high quality standard forms, agreements,general conditions,and other documents,as well as commen- taries on the use of these materials.Developed by practitioners with varying perspectives and experiences,and with extensive review by legal counsel, the EJCDC,AIA,and AGC standard forms are coordinated,reliable,"court- tested”documents that offer significant advantages in most contracting situ- ations.Descriptive information and purchase procedures may be obtained from the respective organizations (EJCDC documents are sold by ASCE, ACEC,NSPE,and CSI). 15.5 INTERNATIONAL CONSTRUCTION CONTRACTS Construction contract documents for work outside the United States are also often based on industry-prepared standard forms.A number of organizations 133 ty Organizations mentionedinthischapter American Consulting Engineers Council:www.acec.org Associated General Contractors of America:www.agc.org American Institute of Architects: www.aiaonline.org American Public Works Association:www.apwa.org American Society of Civil Engineers:www.asce.org Construction Specifications Institute:www.csi.org Design-Build Institute if America: www.dbia.org National Society of Professional Engineers:www.nspe.org >Chapter 7,"Agreement for Professional Services” dy ENAA:www.enaa.or.jp dy FIDIC:www-fidic.org dy ICE:www.ice.org.uk ry JCT:www.ribac.co.uk/ prepare recommended standard general conditions and associated forms.The organizations include: ¢ENAA (Engineering Advancement Association of Japan); ¢FIDIC (International Federation of Consulting Engineers); ¢ICE (Institution of Civil Engineers,United Kingdom); ¢JCT Goint Contracts Tribunal). For example,FIDIC has prepared a widely used standard form,entitled "Conditions of Contract for Works of Civil Engineering Construction,”in con- sultation with lending institutions and with constructor associations.This doc- ument (often referred to as the Red Book,after its color),currently in its fourth edition,is considered to have fairly balanced the contractual risks and respon- sibilities between owner and constructor.It is frequently the design profes- sional's responsibility to adapt its Part II of The Red Book the Conditions of Particular Application,to meet the needs of individual countries or projects. Guides to the use of FIDIC conditions of contract are also published by FIDIC. Some are available through ACEC;all may be obtained from FIDIC. In 1995,FIDIC published "Conditions of Contract for Design-Build and Turnkey”Parts I and II.This document,informally known as the Orange Book,is structured much like the Red Book but is for design-build or turnkey applications.In 1999,FIDIC published the first edition of "Conditions of Contract for Plant and Design-Build,”which is intended for electrical and mechanical plant and building and engineering work designed by the con- tractor.Also in 1999,FIDIC published "Conditions of Contract for EPC Turnkey Projects”and "Conditions of Contract for Construction for Building and Engineering Works Designed by the Owner.”FIDIC's often-used "Conditions of Contract for Electrical and Mechanical Works”is usually known as the Yellow Book. The ENAA has issued model forms for international contracts for both process plant and power plant construction.The ICE has published design and con- struct conditions of contract,as well as a standard "Conditions of Contract for Design and Construction Projects.” SUMMARY The construction contract defines the relationship between the owner and con- structor.These documents embody the agreement between these two parties for construction of the project.The construction contract assigns responsi- bility and authority for managing and administering situations that the par- ties expect to encounter,as well as procedures for addressing those that are unexpected. The development of the construction contract is a crucial phase in the life of a project.The roles and responsibilities stated and assigned by the contract bear directly on the cost and quality of the project,as well as the safety of the people who will build and use it. 134 Therefore,while each party may approach the development and negotiation of the construction contract in good faith,it is important that all contract doc- uments be reviewed and approved by qualified legal counsel-preferably a person or firm with construction experience.2 Chapter 15:The Construction Contract Typical Responsibilities Responsibility Design Design- ig)Owner Professional Constructor Builder Prepare proposed construction ©e contract documents Provide legal review of proposed e construction contract documents Establish procedures for timely and e@ ©e effective contract administration @ =Primary Responsibility @)=Assist or Advise ©=Review 135 CHAPTER 1 6 PLANNING AND MANAGING CONSTRUCTION lanning and managing construction varies dramatically,depending on the type of project,its scope,and the relationships between the owner,design professional,and constructor. This chapter discusses the principal activities involved in construction plan- ning and management,including project organization,pre-construction meet- ings,the nature of the proposed construction activities,and project coordination. 16.1 ORGANIZING FOR CONSTRUCTION A project team's organizational structure strongly influences the construction planning and management activities of the owner,design professional,and constructor.Project team structure depends on the characteristics of the owner's organization-it may be a public agency or a private firm-as well as the type of contracts the owner holds with team members.For example,if the owner chooses a design-build approach,the design professional may con- In this chapter 16.1 16.2 16.3 Organizing for Construction 16.1.1 Owner Responsibilities 16.1.2 Design Professional Responsibilities 16.1.3 Constructor Responsibilities Pre-Construction Meetings 16.2.1 Owner's Pre- Construction Meeting 16.2.2 Constructor's Pre- Construction Meeting 16.2.3 Additional Pre- Construction Meetings Construction Activities tract with and report to the constructor,rather than the owner (as would be 16.3.1 Construction the case in a design-bid-build project).The requirements of funding agencies Scheduling and financial institutions may also affect construction planning and 16.3.2 Estimates and Cost management.Control 16.3.3 Construction Facilities Given the large number of variables that influence project team organization,and Services the team can improve the quality of construction planning and management 16.3.4 Mansoementbyestablishingclearlinesofauthorityandteammemberresponsibilities.This is especially true as owners adopt an increasing variety of project delivery methods.While contracts and laws remain the primary means for defining team 16.3.5 Managing the Construction Work vp eqecs .Forcememberresponsibilities,project participants may no longer assume that tra-16.3.6 Site Safety and Firstditionalowner-design professional and owner-constructor relationships will be Aid applicable to every project.As an example owners of industrial projects often retain responsibility to separately contract for,or provide,process equipment. Owners may decide to contract with a project manager,enter into design-build agreements,or contract with a construction manager.All of these variations involve different construction planning and management considerations. 16.1.1 Owner Responsibilities The primary responsibilities of the owner during construction generally include: ¢Administering contracts and coordinating the activities of participants; *Making prompt decisions on construction matters; 137 16.4 16.3.7 Project Close-Out 16.3.8 Other Activities Coordination and Communication ty Design-Build Institute of America:www.dbia.org *Responding in a timely manner to documents and materials submitted for review; ¢Making payment according to contract terms; ¢Enforcing contracts; ¢Performing other duties and responsibilities assigned by the contract and governing statutes; *Maintaining communication with the public and/or affected parties. While the following activities may occur during the early phases of con- struction,they are most effective if implemented during pre-construction: ¢Engaging a third party design professional for quality control and/or value engineering; ¢Assigning overall responsibility for construction site safety (usually to the constructor). 16.1.2 Design Professional Responsibilities The design professional's agreement,as well as any additional legal require- ments,are the basis for the design professional's activities during construc- tion.The design professional's construction phase responsibilities generally include: ¢Interpreting and clarifying contract documents when questions arise; ¢Reviewing and approving technical elements of contract change orders; e Reviewing and evaluating proposed value engineering suggestions and/or proposed substitutions; ¢«Reviewing and commenting on technical elements of contract submittals; «Providing advice to the owner's Resident Project Representative (RPR) on technical elements of design and construction; ¢Consulting with the RPR on project quality control measures. The design professional's agreement with the owner may define further responsibilities and delegate authority that allows him or her to: ¢Function as the owner's RPR and provide complete,accurate and timely communication with all project team members; ¢Review and approve change orders for the owner's signature; *Review and approve progress pay estimates for payment by the owner; ¢Review and take appropriate action on constructor submittals specified by the contract; *Observe the progress and quality of constructed work and report all observed deficiencies; ¢Represent the owner with regulatory agencies; *Provide other professional services specified by the contract. 138 16.1.3 Constructor Responsibilities As the team member performing work at the project site,the constructor's principal responsibilities include: ¢Providing or causing others to provide the selection,planning and imple- mentation of the actual means and methods of construction; ¢Notifying the owner and design professional of possible design prob- lems during the construction process; ¢Notifying the owner and design professional of unforeseen site conditions; ¢Establishing and maintaining the project construction schedule and budget; «Planning construction related activities including coordinating and sequencing of construction trade work; ¢Performing quality assurance and control for construction activities; «Developing and implementing the construction site safety plan (if del- egated by owner); *Preparing (or causing to be prepared)and reviewing the required shop drawings and other submittals; *Managing and paying construction suppliers and subcontractors; *Constructing the facility in accordance with the plans,specifications, and approved change orders of the construction contract; ¢Fulfilling the provisions of the owner-constructor contract; ¢Complying with applicable laws and regulatory guidelines. Variations in the contractual arrangements and participation of other project- related organizations (such as program,project,and construction man- agers)may involve modifications to the constructor's responsibilities as described above. 16.2 PRE-CONSTRUCTION MEETINGS Upon selection of the constructor,the owner,design professional and con- structor usually hold pre-construction meetings.These meetings provide the participants with the opportunity to become acquainted with each other's organizations and key players,become familiar with the owner's schedule requirements,and agree on methods of communication.In addition to these meetings,many elements of the initial pre-construction meeting(s)may be addressed in partnering sessions moderated by an outside facilitator. 16.2.1 Owner's Pre-Construction Meeting The owner usually holds the first pre-construction meeting,inviting the key construction representatives from his or her organizations the design profes- sional,and the constructor.The owner may also invite representatives of reg- ulatory agencies and,through the constructor,various subcontractors. 139 ASCE Policy Statement 350 "Construction Site Safety” "ASCE believes that safety on construction sites can be improved...by {placing an} emphasis on safety at the project level,(and)the assignment of primary over- all safety responsibility and authority to a single organi- zation for the project...” >Chapter 24,"Partnering” The pre-construction meeting is a unique opportunity for members of the proj- ect team to familiarize themselves with project goals and objectives,other participating organizations,and key personnel.Therefore,the owner benefits from preparing and distributing the agenda in advance,as well as following up with accurate minutes distributed to the attendees.See Figure 16-1. The agenda should also include other items that are unique to the project and/or the owner's requirements. 16.2.2 Constructor's Pre-Construction Meeting After the owner's pre-construction meeting,the constructor may hold a similar meeting for participants involved in the construction effort,including repre- sentatives of subcontractors,material suppliers,and vendors.The RPR and design professional may attend to observe and provide information to the con- structor as requested.If portions of design are to be lawfully delegated to subcontractors,the design professional,constructor and other parties involved should review and confirm in writing the attendant responsibilities in accor- dance with applicable law as early as possible. 6.Project cost control program 7.Methods and schedules of 8.State and local laws or regulations 27. Figure 16-1 Typical Pre-Construction Meeting Agenda Items .Team member roles and 17.Project drug free policy responsibilities 18.Constructor's designated areas for .Communication and correspon-staging and construction dence procedures,including an 19.Coordinating proceduresE-mail distribution list .Procedures for issuing and revis- ing design information and author- izing changes .Documentation,record keeping 23. 20.Quality control 21.Testing procedures 22.Security Project confidentiality require- and reporting requirements ments,if any 5.Project schedule 24.Environmental issues and procedures 25.Site and building cleanup Temporary facilities and services Site logistics payment 26. 9.Subcontractor qualification 28. 10. 11. 12. 13. 14. 15. 16. Insurance coverage,review of Contaminated material handling and disposal certificates and verification of 29.Claims and dispute resolution coverage procedures Critical specifications 30.Equal Employment Opportunity Submittal procedures (EEO)compliance Overtime and shift work 31.Community relations procedures 32.Record and as-built document Safety and first aid requirements33.Project closeoutSurveyinformation Site rules and regulations 140 The agenda for the constructor's meeting is similar to the owner's pre- construction meeting,but the discussion focuses on the performance of the participants who support the constructor. 16.2.3 Additional Pre-Construction Meetings The owner or constructor may hold additional pre-construction meetings on specific elements of the project,such as demolition,roofing,exterior wall installation,or other discrete tasks that are critical to a project's overall suc- cess.These meetings may include representatives of the owner,design pro- fessional,constructor,subcontractors,suppliers,associated construction crafts, and other participants.Agenda items for these meetings may include per- formance expectations,anticipated results,schedule,logistics,necessary approvals,acceptable practices and procedures,safety,resources,and other related issues that need to be resolved before construction activities begin. 16.3 CONSTRUCTION ACTIVITIES The planning and managing of construction focuses on the successful sequencing and performance of activities at the construction site.The owner and design professional begin planning construction even before the con- structor is engaged,estimating the major schedule milestones for inclusion in the construction contract.After joining the project team,the constructor takes a lead role in revising construction plans to the level of detail necessary to actually begin construction activities.The RPR reviews and approves the planning and schedule refinements proposed by the constructor. The construction planning and management activities that the team addresses in pre-construction planning include: ¢Construction scheduling; ¢Estimates and cost control; ¢Providing construction facilities and services; ¢Procurement of materials and waste management; ¢Managing the construction work force; ¢Safety and first aid; *Project close-out; ¢Other activities that may be specific to a particular project. Projects benefit from these planning and management activities-projects with relatively short construction schedules generally benefit the most from aggressive efforts in these areas.The following sections address these topics. 16.3.1 Construction Scheduling During a project's pre-construction phase,and continuing through construc- tion,the project team regularly updates the schedule,incorporating increas- ingly greater levels of detail about the activities and schedules of subcontractors and other participants.On longer projects (those lasting a year or more),the team may use a "rolling”schedule with an upcoming window of several weeks or months to display detailed and specific construction 141 >Chapter 12,"Pre-Contract Planning for Construction” Schedules reflect available resources and funds,and the allocation of staff,trades people, materials and equipment. >17.2.2,"Project Schedule” information.The constructor often prepares a daily schedule to aid in direct- ing the on-site work force.If the owner uses multiple construction contracts for a single project,a specific designee of the project team integrates the schedule of each constructor into the overall project schedule to ensure suc- cessful interfaces among the constructors. The size and complexity of a project influence the team's selection of appro- priate scheduling processes and technologies.The team establishes schedule milestones that reflect the individual needs of project participants,as well as the activities that involve cooperation and have interdependence among two or more participants.The schedule reflects available resources and funds,and the allocation of staff,trades people,material and equipment. Construction schedules are "living”documents.They evolve with the proj- ect,providing the project team with a roadmap that shows a project's current status,its rate of progress and the anticipated milestone and completion dates. 16.3.2 Estimates and Cost Control The constructor usually refines and updates cost estimates as construction proceeds.The actual progress of construction provides the constructor with the information necessary to track variations in cost and productivity from those forecast in estimates.This information often proves valuable in identi- fying potential problems and significant deviations from initial cost estimates, allowing the constructor to correct many problems early on that would oth- erwise create cost overruns and disputes. Original bid packages may contain a "'per-unit”price for material furnishing and installation.This unit price provides a defined value for additional work that may be necessary beyond that described in the construction documents owing to unforeseen conditions or a change order issued by the owner.Care must be exercised in obtaining and using unit prices as they are often evalu- ated and/or bid out of the context in which they will be used.As an example the provider of the price will not know if the pricing will be for 1 or 1,000 units,or if the item will be added before,during or after the work related to the item is constructed. It is also prudent to include contract provisions for mark-ups on changes for overhead and profit.Such provisions should also address the mark-up on multi-tier changes that involve subcontractors and possibly sub-subcontractors and/or vendors. Cost control includes procedures for handling changes to the design and asso- ciated contracts.The procedures should address the processes for authoriz- ing,documenting,pricing and implementing project changes.These procedures also include steps to assess the potential schedule,budget and quality impact of proposed changes. Estimates and cost control also involve developing procedures for determin- ing and disbursing payment.The owner and constructor usually address pay- ment during contract negotiations,including such procedures as base contract 142 work,changes in progress,unit cost items,and anticipated labor and material work. 16.3.3 Construction Facilities and Services Before mobilizing work crews and equipment for construction,the construc- tor finalizes plans for temporary construction facilities,site logistics,and util- ities.During the bidding phase,the owner identifies facilities that will be provided to the constructor.The constructor typically acts on these plans as soon as possible to ensure uninterrupted utility service and compliance with the terms of the contract with the owner. 16.3.4 Material and Waste Management During the submittal process,it is valuable for the constructor to obtain sam- ple materials and products,as well as supporting documentation from sup- pliers and manufacturers.These aid the constructor in developing plans for managing the materials that are to be brought to the work site.This planning may include determining purchasing needs,delivery considerations,special storage needs,and in-storage maintenance of materials.The constructor coor- dinates the materials management plan with the schedule and continues to synchronize material needs to the schedule as the project progresses.The availability of materials is a prime consideration whenever the schedule is revised.Shortages of materials can interrupt work routines and adversely affect quality and/or cost. The materials management plan is a crucial aspect of the estimating process, as it impacts the determination of the size and number of necessary offices, warehouses,and lay-down yards,as well as staffing needs.Computerized material management systems can enhance the managing of materials sig- nificantly by assigning schedule item numbers to material records. The need for a parallel waste management assessment or plan is directly related to materials management.A significant volume of waste,which must be recycled,reused,or disposed of,can accumulate during the construction phase of a project.Waste management programs vary significantly depend- ing on available hauling and dumping facilities;local,state and federal laws and guidelines;recycling opportunities and contractual requirements.Creative solutions to waste management can save money and create a positive image for the project;the use of concrete demolition debris as road fill is an exam- ple.Projects should be assessed for the need of a hazardous waste manage- ment plan.If needed,a comprehensive plan that meets project,local,state and federal requirements must be developed,documented and properly dis- tributed to appropriate project team members. 16.3.5 Managing the Construction Work Force A qualified construction work force is an essential ingredient in a successful project.The need for skilled trades workers varies with each project,and the assembling and managing of an appropriately sized work force with the appro- priate skills is a difficult yet crucial responsibility of the constructor. 143 ASCE Policy Statement 350, "Construction Site Safety” iy Occupational Safety andHealthAdministration: www.osha-sic.gov Associated General Contractors:www.agc.org >9.1.4,"Design Close-Out" The local availability of skilled construction workers is a key factor in the constructor's management of the work force.The constructor may gain some flexibility in meeting skilled labor needs by allocating available trades work- ers,or by spreading out the anticipated work-load,in such a manner that the ranks of workers with the necessary skill sets are not depleted during any given time period.The constructor may introduce employment incentives and on the job training to help alleviate shortages of qualified workers.The con- structor may also consider prefabricating some project elements in another location where there are sufficient numbers of skilled workers to achieve the project objectives. In addition to managing the skill levels and size of the construction work force,the constructor is responsible for ensuring that the work force meets applicable contractual and legal provisions.These typically include Equal Employment Opportunity guidelines (including compliance with hiring goals for minorities and women),community hiring,relationships with labor unions, and safety training and compliance. 16.3.6 Site Safety and First Aid Site safety is the responsibility of the owner.However,because of the inte- gral relationship of site safety to the constructor's means and methods of con- struction,on most projects the owner assigns to the constructor the responsibility for planning and implementing safety and first aid programs. Such programs are geared to ensure compliance with federal,state,and local laws and regulations,and to address issues that are unique to the project or its method of execution. Job site safety plans may include: *Clearly posted safety rules,inspection procedures,and enforcement actions; ¢Safety training sessions; ¢Safety certification of personnel entering the work site; *Personal safety equipment (hard hats,boots,safety vests)available at site; ¢Training for emergency first aid and fire fighting; e Emergency telephone numbers posted for paramedics,fire fighters,and police; *Designation of emergency escape routes and gathering areas; *Safety drills; ¢The establishment of safety quotas (such as number of "safe days”at the site)and performance incentives to achieve them. 16.3.7 Project Close-Out Final close-out involves joint participation of the owner,design professional, and constructor.These include: ¢Preparing the punch list and assurance of compliance; 144 ¢Submitting a complete package of warranty and standard materials to the owner; ¢Providing training on the use of equipment; *Providing periodic maintenance checks of equipment during warranty periods; *Submitting record drawings of completed facilities in hard copy and electronic formats; ¢Completing necessary certification for government agencies. 16.3.8 Other Activities The planning and management of construction activities may involve a wide range of other concerns,depending on the size and scope of the project.These may include: *Environmental controls,which often include "best management prac- tices,”or BMPs,such as fencing,hay bales,water treatment,and restricted work hours,to limit the environmental impact of construction activities; *Hazardous waste handling and disposal,which includes procedures for testing,storing,and disposing of materials,such as asbestos,lead,or contaminated soil; ¢Traffic control,including detours,parking,police details,and lane restrictions (these are typically noted in the bid package); ¢Public outreach,including notification of work schedules and impacts to local residences and businesses; *Making photographic,video,and electronic records of project progress. 16.4 COORDINATION AND COMMUNICATION Construction planning and management activities depend on well-defined lines of communication among the project team members,subcontractors, vendors,regulators,and other participants.The coordination and communi- cation activities with direct bearing on planning and managing construction include: *Developing unambiguous contracts and supporting documents; *Developing design documents consistent with the owner's program and intent; ¢Specifying the owner's reporting requirements clearly; ¢Scheduling meetings for appropriate topics and intervals; ¢Distributing correspondence in a timely fashion; *Processing shop drawings efficiently; ¢Reviewing and processing payments in a timely manner; *Initiating and maintaining relationships with relevant government agencies. While these activities may involve any team member at any phase of the proj- ect,the constructor plays a larger role in coordination and communication 145 Hazardous Materials are a unique and critical concern,as the responsibility for their handling and disposal often hinges on when they are discovered.Therefore,the project team benefits from an aggressive effort to identify possi- ble hazardous materials during project development and design. >Chapter 5,"Coordination and Communication” during construction,and is responsible for directing activity at the work site and coordinating the participation of subcontractors.Therefore,it is vital to the coordination effort that the contract specify a single party with the author- ity to direct the constructor's activities.Similarly,vendors and manufactur- ers should accept direction only from the constructor,as in the signing of a purchase order,unless the contract terms specify otherwise. SUMMARY Strategies for planning and managing construction are evolving as project delivery methods proliferate.New project organizational arrangements are merging and transforming the traditional roles of the owner,design profes- sional,and constructor.In some cases,design professionals are involved in program management,while in other situations,such as design-build, constructors are involved before the start of construction planning and management. Therefore,an understanding of the key project responsibilities of and by all project team members is an important aspect of project quality.Q 146 Chapter 16:Planning and Managing Construction Typical Responsibilities Responsibility Design Design- i!Owner Professional Constructor Builder Assign contractual responsibilities @ @®@ @ Develop construction plan O O @ e@ Initiate reporting system O oO @ e Provide and update construction schedule ©O r )e@ Perform estimating and cost control O O e@ e@ Provide construction facilities and services CQ O e @ Procure materials and manage waste O O tr )r Manage the construction work force e e@ Provide safety programs and first aid @*O e*e* Perform project close-out O O e@ e@ Supervise construction e@ e Maintain construction quality control oO t )e@ e@ Interpret drawings ©@ e e Make design revisions O @ 'O)@ Submit payment requests @ ©e@ e Issue stop work order (non-emergency)t )©© *As designated by the owner (see ASCE Policy Statement 350,"Construction Site Safety.”) @ =Primary Responsibility @ =Assist or Advise ©=Review 147 fter the owner awards the construction contract,the constructor prepares and submits to the owner and/or,if designated,the design professional the information necessary to determine that project facilities will be built in accordance with the project objectives,as defined in the construction contract documents.This information from the constructor falls into two broad categories: ¢Contract documentation,which demonstrates that the constructor is prepared to properly execute and manage the project; *Submittals,which include reports,shop drawings,schedules,and other information showing that the constructor's proposed or completed work meets the technical intent of the design. This chapter describes the nature of the documentation and submittals,as well as the roles and responsibilities of project team members in preparing and processing this information under traditional design-bid-build (DBB)con- tracting.In alternate forms of project delivery,the design professional or con- structor may do internally many of the processes described;and a design professional or other consultant engaged by the owner may also have a review role in these processes. 17.1 ROLES AND COORDINATION Contract documentation and submittals encompass a wide range of informa- tion that the constructor provides to the owner and/or,if designated,the design professional (see Figure 17-1).Generally,all communication from subcon- tractors to the owner or design professional is routed through the construc- tor.In cases where the nature of the project involves close coordination among parties to meet technical specifications,the parties may direct subcontractors and suppliers to communicate directly with the design professional and to inform the constructor of their decisions. The owner usually reviews non-technical contract documentation,while the design professional reviews most technical documentation and submittals for conformance with the design concept of the project and information in the construction contract documents.The design professional does not usually review aspects of technical submittals pertaining to the construction process, such as: ¢The means,methods,techniques,sequences,and procedures of construction; ¢Detailing dimensions; 149 CHAPTER 7 7 CONSTRUCTION CONTRACT DOCUMENTATION AND SUBMITTALS In this chapter 17.1 Roles and Coordination 7.14 17.1.2 17.1.3 Owner Design Professional Constructor 17.2 Contract Documentation 17.2.1 17.2.2 Non-Technical Documentation Schedule 17.3 Technical Submittals 17.3.1 17.3.2 17.3.3 17.3.4 17.3.5 17.3.6 17.3.7 17.3.8 17.3.9 Preliminary Technical Submittals Shop Drawings for Structural Components Shop Drawings for Manufactured Structural Components Shop Drawings for Mechanical and Electrical Components Shop Drawings for Temporary Construction Pre-engineered and Prefabricated Components Placing Drawings for Concrete Reinforcing Steel Test Results Samples and Mock- ups 17.3.10 Constructor Proposals Focus on Shop Drawings, John Clark,ASCE,1985. *Fit or constructibility in the field; ¢Safety precautions and programs. The following sections describe the roles and responsibilities of the primary team members in promoting the smooth flow of this information,as well as the general coordination of the flow of documentation and submittals. 17.1.1 Owner The preparation,coordination,review,and approval of contract documents and submittals are crucial in allowing sufficient time and funding for the design professional,constructor,sub-consultants,and subcontractors to accomplish their respective contractual obligations.Project quality benefits from the use of tracking systems to manage contract documents and submit- tals,thereby expediting the completion of their review in a timely manner. The owner's contracts with the constructor and design professional define the responsibilities of each party related to contract documentation and submit- tals,as well as the nature of the information to be submitted.The owner usu- ally requests information in the following general categories: *Non-technical contract documentation (insurance coverage,legal obli- gations,and schedules); ¢Preliminary technical submittals. 17.1.2 Design Professional As the creator of the technical plans and specifications,the design profes- sional is responsible for providing sufficient information to permit the prepa- ration of shop drawings,placing drawings,and other technical submittals relating to work or materials that will be incorporated into the completed and permanent project. At a minimum,the design professional is responsible for identifying the nature,magnitude and location of all final design loads that will be imposed on the supporting completed and permanent structures.The design profes- sional is also responsible for exercising professional care in preparing the design and in complying with applicable building codes.The design profes- sional should present the design information in a recognized format that will allow the constructor and members of the construction team to understand the design objectives. The design professional's review of submittals is typically for the limited pur- pose of evaluating whether the content of the submittal is consistent with the design intent and information contained in the contract documents.As a gen- eral matter,information in a submittal relating to the constructor's proposed or actual means and methods of construction are beyond the scope of the design professional's review.The design professional should prepare and uti- lize a submittal stamp that defines the purpose,scope and limitations of his or her review and/or approval of submittals in a manner consistent with con- tractual obligations. 150 Figure 17-1 Contract Documentation and Submittal Process 1.Constructor consults support team The constructor consults with fabricators,suppliers,subconsultants,and others with submittal responsibilities to determine schedule requirements. Y 2.Constructor meets owner/design professional The constructor and team members with submittal responsibilities meet with the owner and design professional to review design requirements,lines of communication,the schedule,and other criteria related to the development and processing of documentation and submittals. Y 3.Constructor prepares documentation/submittal The constructor's team prepares the documentation and submittals.If any team member needs further clarification of contract requirements,the constructor makes, or authorizes the team memberto make,a written request for information from theownerordesignprofessional.(If unusual circumstancesor time constraints render a written request impractical,then oral communication is acceptable-as long as all parties agree.) ¥ 4.Constructor transmits documentation/submittal When the constructor has reviewed and is satisfied with the quality of the information prepared by the team,the documentation or submittal is transmitted to the owner or design professional. Y 5.Owner/design professional review;request revisions In general practice,the owner reviews documentation and submittals that are contractual or business-related in nature;the design professional reviews technical items.(Some items may be reviewed by both the owner and the design professional.) The owner and design professional advise the constructor if revisions are required. Y 6.Constructor makes revisions (if required) The constructor revises any documentation and submittals that are not approved and resubmits them.In some cases,more than one round of revisions may be required. Y 7.Owner/design professional approve documentation/submittal The owner and design professional provide the constructor with written notice of their approval of the documentation or submittal.In the case of technical submittals,the constructor then returns materials to the appropriate parties so that work may proceed. y Construction of specified elements proceeds 151 The constructor plays a central role in maintaining the smooth flow of this information. >10.2,"Design Disciplines and Project Objectives” In addition to the review of submittals relating to technical issues,the design professional's agreement often outlines his or her responsibilities regarding other types of submittals.Typically,the review of change orders,requests for extra work,construction schedules,constructor requests for additional infor- mation,and the review of payment requests are generally part of the design professional's construction-period services.The design professional also may be responsible for tracking contract documents and submittals. As with the responsibilities of all members of the project team,the design professional is responsible for accomplishing these tasks in a timely manner. 17.1.3 Constructor In the construction contract submittal process,the constructor is responsible for: *Producing or eliciting contract documentation and submittals from sub- contractors and/or fabricators; *Reviewing and concurring with the contract documentation and sub- mittals; ¢Submitting the documentation and submittals to the owner and/or design professional; *Reissuing the submittals as required. The constructor's development of a system and schedule for preparing and tracking submittals is essential-and usually stipulated by the construction contract.This system must be realistic and workable to meet the requirements of the owner and design professional,as well as those of the constructor's subcontractors and suppliers.The documentation and submittal system must also include time and resources to accommodate the review and approval by regulatory agencies. To improve the quality of technical submittals,especially shop drawings and placing drawings,some constructors have an engineer on staff or,more com- monly,engage a subcontractor to perform specialty engineering or "detail- ing.”In some cases,the constructor may aid the production of shop drawings by allowing direct communication between the staff person or sub-consult- ant performing the engineering and those on the owner or design teams that are familiar with the related project objectives.However,it is important that the constructor maintain control of the shop drawing process and associated communication. The constructor's detailer prepares the drawings in accordance with: The design information in the construction contract documents; *Instructions from the design professional (as specified in the contract documents or in a written request for additional information); Sound construction practices; Applicable regulatory laws and guidelines. 152 17.2 CONTRACT DOCUMENTATION Construction contracts assign responsibility to the constructor for providing a body of information,known as contract documentation,to verify perform- ance capability and actual performance,and provide necessary project deliv- ery data.The primary areas of contract documentation are non-technical documents,the schedule,shop drawings and constructor proposals.Some of this information is submitted shortly after the award of the construction con- tract.Other contract documentation is submitted and updated continually throughout the construction process to support and confirm the proper com- pletion and management of the project itself. 17.2.1 Non-Technical Documentation The constructor usually submits a variety of non-technical information promptly after the award of the contract,including: Evidence of performance,payment,and material bonds; Proof of insurance coverage; *Names of proposed subcontractors,suppliers,and manufacturers; ¢Estimated cash flow needs; ¢Schedule of payments; ¢Health and safety plans. Regulatory agencies may stipulate that the constructor provide non-technical documentation or information related to project safety,wages and hours,com- pliance with minority and women employee hiring goals,environmental impacts,and other regulatory concerns. 17.2.2 Schedule The project schedule is developed with input from project participants,focuses on relevant responsibilities,and provides sufficient and appropriate detail. While schedules are often viewed as a tool of the constructor,they are most effective when used by the entire team.Some typical characteristics of proj- ect schedules are described below. Level of Detail:From the constructor's perspective,the schedule should be sufficiently detailed to manage the work and resources needed to complete the job.The project team's scheduling needs,however,tend to focus on the flow of information,the interface of various responsibilities between team members and the significant milestones that define the progress of the project. Sources of Input:The initial schedule should have input from all levels of the project team-owner,design professionals,con- structor,subcontractors,vendors and manufacturers. Regulatory agencies that enforce building codes,envi- ronmental laws,safety,and zoning regulations should also be consulted for possible schedule impacts.Labor 153 organizations and community action groups may also have concerns that could relate to schedule time and resources. Flexibility:The schedule is a dynamic tool that is used daily to mon- itor and manage the project.Changes to the scope of work,site conditions,availability of labor and material, and the flow of information should be incorporated in the schedule as they are identified. 17.3 TECHNICAL SUBMITTALS Generally,submittals are documents of a technical nature developed by the constructor to describe elements of the permanent project work at a level of design detail that is sufficient to allow the construction,fabrication,or man- ufacture of the elements in accordance with the requirements of the contract documents.Submittals include: ¢Preliminary technical submittals; *Shop drawings for structural components; *Shop drawings for manufactured structural components; ¢Shop drawings for mechanical and electrical components; «Shop drawings for temporary construction; ¢Pre-engineered and prefabricated components; ¢Placing drawings for concrete reinforcing steel; ¢Test results; ¢Samples and mock-ups; *Constructor proposals. The following sections describe these technical submittals.Note that some submittals must be signed and sealed by a registered professional engineer, while others need only to be verified for compliance with applicable codes and standards. 17.3.1 Preliminary Technical Submittals The owner and design professional (if assigned to do so under the terms of the professional services agreement)may call for the constructor to provide preliminary technical documentation before the bulk of a project's technical submittals are transmitted.Preliminary technical documentation may include: *Specifications of certain equipment and materials; ¢A breakdown of any lump-sum bid items for partial payments,some- times known as a schedule of values. In most cases,the approval by the owner and design professional of the pre- liminary technical documentation,which may call for the constructor to address structural and architectural considerations,is necessary before con- struction moves forward.The constructor may need to work closely with other members of the project team to satisfactorily address owner concerns. 154 17.3.2 Shop Drawings for Structural Components Structural shop drawings depict structural or architectural components that will be part of a completed structure.These components are fabricated or con- structed according to the requirements provided by the design professional in the construction contract documents. Shop drawings are needed for a broad range of structural components and connections,including those made of steel,concrete,wood,plastic,and most other construction materials.The detailed design of connections and unique structural elements is often deferred until a fabricator is selected,which allows the design to be tailored to the particular capabilities and production proce- dures of the fabricator. The design professional typically has the authority and responsibility for overall design,while the fabricator is responsible for designing and detailing the structural components and connections.In some cases,the owner may contract with the design professional to design the entire structure,including the connections.Often,when structures involve simple components and con- nections,the design professional may analyze and approve structural systems designed by the fabricator from accepted industry standards (if permitted by the construction contract documents). For more complex structures with nonstandard components and complex connections,the construction contract documents usually specify one of two general design approaches: 1.The design professional performs complete engineering design. 2.The fabricator provides the services of a qualified professional engi- neer to design or supervise the design of components and connections that are not completely designed in the construction contract documents. Under the second approach,the construction contract documents include the necessary loading information,as well as performance data and other speci- fications not defined in the codes and standards governing the project.The fabricator provides the design professional with shop drawings that have been certified by a professional engineer as meeting the component and connec- tions specifications in the contract documents.In this case,the design pro- fessional is still responsible for the design of the completed structure,the review and approval of the design of structural systems,and the review and approval of shop drawings. Under either alternative,the design of structural systems is completed by,or under the supervision of,a qualified professional engineer.The design professional is responsible for including sufficient information in the con- struction contract documents to permit the preparation of shop drawings.The review and approval of shop drawings,calculations,and associated docu- mentation generated by the design professional provide confirmation that the design concept of the project and information given in the construction contract documents conform to and are compatible with primary structural systems. 155 Shop drawings are needed for structural components and connections,including those made of steel, concrete,wood,plastic, and most other construction materials. The constructor and the subcontracted fabricator are responsible for meeting the specifications for materials and fabrication processes.Activities to meet this goal include maintaining the specified fabrication and construction tol- erances,developing detailed dimensions,and establishing that the fit and erec- tion of the structure in the field can be accomplished in an acceptable manner in accordance with the contract documents,approved shop drawings and industry standards. 17.3.3 Shop Drawings for Manufactured Structural Components The constructor is responsible for assuring that the manufacturer-supplied components meet the level of quality specified by the design professional in the contract documents with respect to performance and material selection. Manufactured structural components that may be part of a completed struc- ture may include: ¢Skylights ¢Wood floor or roof trusses ¢Elevator structural supports ¢Cellular floors ¢Curtain walls ¢Decks ¢Proprietary space truss systems *Pre-cast concrete components *Steel stairs Other pre-engineered components *Pre-cast concrete stairs involving design and fabrication *Steel joists The design professional's activities for manufactured structural items include specifying performance specifications in the contract documents and review- ing the documentation provided by the manufacturer to ensure compatibility with the project objectives for the completed structure.The design profes- sional may specify that the manufacturer's submittals bear the signature and seal of a professional engineer in order to be approved. 17.3.4 Shop Drawings for Mechanical and Electrical Components Many projects call for uniquely engineered mechanical and electrical com- ponents.Examples of components with specifications that can vary widely from project to project include: *«Components to meet access regula-¢Heating,ventilation,and air condi- tions for people with disabilities tioning (HVAC)ducts ¢Electrical distribution systems *Lighting components or systems ¢Fire suppression and smoke detec-¢Piping tion systems ¢Water,fuel,and coolant tanks ¢Fire proofing materials and assemblies Shop drawings or other technical documentation (including test results)for these components are considered in a manner similar to those specified for structural components by the particular engineering discipline involved. 156 17.3.5 Shop Drawings for Temporary Construction Temporary construction shop drawings depict components that exist only dur- ing construction,such as equipment slabs,temporary lifts,temporary build- ings,shoring,re-shoring,form work,bracing,scaffolding,de-watering facilities,and temporary power systems.As the party responsible for carry- ing out the construction plan,the constructor has full authority and responsi- bility for these shop drawings,including their design,preparation,review,and approval.However,shop drawings for any construction element that involves engineering analysis or design services,such as shoring,bracing for excava- tions,or temporary construction,need the seal of a qualified professional engi- neer who,typically,is engaged by the constructor. Procedures for submitting shop drawings for temporary construction facili- ties vary in several respects from those for other types of submittals,since the constructor retains full control and responsibility for temporary work.The design professional does not usually review temporary construction shop drawings,except when it is necessary to determine compatibility with the design of a safe and properly completed structure.The design professional may specify in the construction contract documents the duration that is accept- able for the placement and use of items such as temporary bracing,shoring, re-shoring,and similar temporary structures. The design professional may specify the use of structures that may need spe- cial treatment or safeguards during construction,such as non-self-supporting frames,and indicate the impact that the design concept may have on the con- struction sequence or performance of the permanent structure.In cases where temporary structures may have an impact on the design concept or completed structure,the constructor may be required to submit the relevant shop draw- ings for review and approval by the design professional consistent with lim- itations set forth in the contract documents. 17.3.6 Pre-engineered and Prefabricated Components The design professional may define the general nature and quality of certain manufactured or shop-fabricated components by specifying a particular brand name and model or its approved equal.The design professional may also define the specifications referring to trade industry codes or operational characteristics,such as operating efficiency,capacities,power needs,or energy output.Examples of components for which such references are generally acceptable are: ¢Pumps; *Boilers,chillers,heat exchangers,and air handlers; ¢Emergency power systems; ¢Water and sewerage treatment equipment; ¢Exhaust systems; ¢Elevators,escalators,lifts,and conveyors. Compliance with the performance responsibilities of the construction con- tract documents may be demonstrated by a manufacturer's warranty and 157 >10.2,"Design Disciplines and Project Objectives” certification,or by the owner's representative (often the design professional) witnessing tests in the manufacturer's laboratory and confirming the validity of the manufacturer's claims. In reviewing the constructor's shop drawings for factory-assembled materi- als and equipment,the design professional determines compliance with the design concept and compatibility with other elements of the project,such as: ¢Anchor bolt layout; ¢Foundation designs; ¢Pipe fittings,flanges,and welds; ¢Routing of utilities; ¢Drainage for water and other liquids; ¢Wiring for power supply; ¢Interfacing of instrumentation and controls. Although the design professional may review and comment on interface data, it is the constructor's responsibility to complete the installation in accordance with the provisions of the contract documents. Some pre-engineered,prefabricated and standalone specialty components, such as office equipment,computers,or other items may be too complex to be included in shop drawings.In such cases,the design professional and con- structor (and supplier,if appropriate)may review the related technical spec- ifications and determine whether the manufacturer's or supplier's certification of the components satisfies the contract documents. 17.3.7 Placing Drawings for Concrete Reinforcing Steel Concrete placing drawings illustrate the reinforcing steel components that will be part of a completed structure.These components are crucial to the safety and performance of a completed facility. Reinforcing steel components are furnished and placed according to the design professional's specifications in the construction contract documents.Examples of components for which placing drawings are prepared include cast-in-place concrete and post-tensioned pre-stressed concrete structural elements. The design professional has authority and responsibility for overall design of the completed structure and for the review and approval of the placing draw- ings for conformance with the project design concept and the information in the construction contract documents. The constructor and subcontractors have responsibility for preparing the plac- ing drawings,providing the materials specified,and completing the fabrica- tion and construction processes.This work is carried out in accordance with the construction contract documents,approved placing drawings,and accepted industry standards. 158 In most cases,placing drawings for reinforcing steel in cast-in-place concrete do not need design services and it is not necessary or appropriate for the con- tract documents to call for certification by a registered professional engineer. For post-tensioned pre-stressed cast-in-place concrete structures,the design professional may delegate certain design activities to a specialty engineer employed or retained by others and provide specifications for the loading con- ditions and other design parameters in the contract documents.In such cases, the design professional retains responsibility for the overall safety and per- formance of the completed structure.The specialty engineer is responsible only for the design work delegated and certifies with signature and seal that the related calculations and drawings meet the specifications provided by the contract documents. To ensure the quality of concrete elements,construction contract documents usually call for the submittal of evidence that manufacturers of pre-cast,pre- tensioned,pre-stressed concrete components and related items are certified to function according to the standards of the relevant industry association. These include: ¢Prestressed/Precast Concrete Institute (PCD; ¢National Precast Concrete Association (NPCA); ¢Concrete Reinforcing Steel Institute (CRSD; National Ready-Mix Concrete Association (NRMCA); Post-Tensioning Institute (PTI). Concrete related submittals may also include verification of certification for the necessary work in accordance with governmental agency,such as the fed- eral Occupational Safety and Health Administration (OSHA)and applicable building codes. 17.3.8 Test Results For some projects,the construction contract documents may call for the testing of certain materials by an independent testing laboratory to determine if they meet the specifications of the construction contract documents.Examples are: *Soils testing; Materials testing; Chemical or biochemical testing of water; ¢Shop inspection testing; ¢Pipe fabrication testing; *Welding. Manufactured equipment and operating systems may also need independent testing.The owner typically engages the services of an independent testing laboratory or directs the constructor to do so.Test results are usually sub- mitted to the owner,design professional,and constructor simultaneously.The 159 ty Concrete LinksWwww.pci.org www.precast.org WWW.CTSI.Org ay www.osha.gov constructor generally reviews the results for adequacy,while the design pro- fessional focuses on conformance with the contract provisions. 17.3.9 Samples and Mock-ups The main use of samples and mock-ups is to assure the project team that the material,piece of equipment or building element being provided by or through the constructor is consistent in terms of aesthetics and/or function with the contractual documents. Examples of building components in three general categories include: 3&Manufactured #284 Custom-produced 35 Natural MaterialsJ ¢Door hardware *Pre-cast concrete ¢Wood panels *Light fixtures panels ¢Naturally finished ¢Manhole covers ¢Built-up structural stone (slate or steel members processed stone) *Terrazzo Meeting the quality provisions of the contract documents can be assured only if the measured criteria are embodied in one sample.Having one sample with the desired functionality,another with the correct color and a third with the approved texture will often result in a delivered product that is not acceptable. Samples for custom or natural materials should include ranges to properly identify the allowable variation of color,texture,imperfections,or other antic- ipated variables.All such samples should be viewed for acceptance in an envi- ronment identical to the final location of the materials. Mock-ups can range in complexity from aesthetic samples to full scale ele- ments of the constructed project to be tested against various performance cri- teria set forth in the contract documents.Generally mock-ups are used to answer the question:"What is it going to look like?”While aesthetics are cer- tainly an important issue,mock-ups can also serve a number of other useful functions: Testing of items,such as curtain wall mock-ups; ¢Checking the interfaces of building components; ¢Determining the functional capabilities of constructed and furnished elements in a variety of use scenarios; Verifying the constructability of complex and/or repetitive elements. Care must be exercised to assure that the mock-ups (and samples)are con- structed in a manner consistent with the practices that will be used in the construction of the actual project.Laboratory technicians working in a near clean room environment should not be used to install caulking that will actu- ally be installed by tradesmen on a scaffold in less than optimum conditions. In addition,mock-ups and samples should be retained until all work has been completed and accepted. 160 17.3.10 Constructor Proposals Constructor proposals constitute a unique form of submittal,as they cannot by their nature be specified in the contract documents (though procedures for submitting them should be).Constructor proposals are technical submit- tals requesting modifications to the construction contract specifications that the constructor has determined are either necessary or desirable to achieve the specified material selection,fabrication,erection,or placement results. To initiate such a change,the constructor makes a written request to the design professional incorporating as much information and relevant supporting doc- umentation as possible from supporting fabricators,specialty engineers,detail- ers,and suppliers.If the proposal involves a revision to a custom designed project component,the constructor supplies drawings certified by a registered engineer. The design professional reviews the proposal and makes a recommendation to the owner as to whether or not the proposal is appropriate.The owner makes the final decision on any deviations from the construction contract provisions. SUMMARY The smooth flow of contract documentation and submittals from the con- structor to the design professional and owner is a crucial activity,as it allows work in the field to proceed efficiently.Delays in generating,reviewing,or approving documentation and submittals can compound the already chal- lenging task of faithfully transforming the contract documents into the desired completed structure. The constructor takes the lead in the documentation and submittal process, holding primary responsibility for transmitting the information called for by the construction contract.The constructor coordinates the documentation and submittals of subcontractors,material and equipment suppliers,fabricators, and testing laboratories.The design professional and owner are responsible for the timely and appropriate level of review of information submitted by the constructor to keep the contract documentation and submittal process on schedule.O 161 Chapter 17:Construction Contract Documentation and Submittals Responsibility Matrix Responsibility 0 Owner Design Professional Constructor Design- Builder Establish contract documentation and submittal responsibilities and procedures Provide sufficient technical information in contract documents to produce documentation and submittals Specify shop drawing submittal! procedures Comply with applicable design codes and regulations Ensure shop drawings comply with construction contract documents Produce shop drawings for permanent components Produce shop drawings for temporary components Produce concrete placing drawings Review and approve most non-technical contract documentation Review and approve most technical documents and submittals Track documentation and submittals Incorporate test results Review documentation and submittals in a timely fashion ©®©00®©6®@@0o@*© 1)eoe@@©©e®OO©@®©@©©@eK "If components affect permanent facility. **Design-build team reviews internally information that would typically be submitted. @ =Primary Responsibility @ =Assist or Advise ©=Review 162 CHAPTER 7 3 CONSTRUCTION CONTRACT ADMINISTRATION he effective administration of the contract between the owner and con- structor is crucial to project quality.This chapter discusses the practices and procedures that the owner may employ to establish and maintain a pro- ductive and positive contractual relationship with the constructor. At the heart of this relationship is the construction contract between the owner and the constructor,which includes the contract itself,and the construction plans,specifications,and special provisions.The Resident Project Representative (RPR),a person or entity appointed by the owner,adminis- ters the construction contract in accordance with the owner's project goals In this chapter 18.1 18.2 Resident Project Representative (RPR} Quality Objectives 18.2.1 Materials 18.2.1(a)In situ Materials 18.2.1(b)Procured Materials 18.2.2 Substitutions 18.2.3 Tradecraft and objectives.18.3 Job Site Safety 18.4 Payment 18.1 RESIDENT PROJECT REPRESENTATIVE (RPR)18.4.1 Payments for The owner may designate a staff member or engage a person or firm with Ostend Workconstructionadministrationexpertise(often a design professional or a con- struction manager)to serve as the RPR.The RPR's primary responsibility is the administration of the construction contract.The duties of the RPR begin with the development of construction administration procedures that call for monitoring construction progress,and maintaining appropriate records of the constructor's performance and compliance with the terms of the contract doc- uments.On large projects,the RPR may delegate responsibilities to individ- 18.4.1(a)Unit-Price 18.4.1(b)Lump Sum 18.4.1(c}Cost-Plus 18.4.2 Retainage 18.4.3 Liquidated Damages 18.4.4 Bonus Clauses 18.4.5 Payments for Work ual inspectors.Related to Unforeseen The owner's contract with the RPR assigns to the RPR a range of responsi-Conditions bilities that may include:18.4.6 Non-Constructor Invoices *Pursuing the attainment of quality goals;18.5 Constructor Submittals *Collecting and monitoring current construction expenditures and facil-18.6 Change Orders itating timely progress payments under the terms of contract;18.7 Coordination of Activities ¢Pursuing the timely review and approval of contract documentation and 18.8 Documentation submittals by the design professional; *Evaluating and making decisions related to unforeseen conditions; *Coordinating owner-related site activities; *Promoting good project communication; ¢Building the project record by organizing and maintaining all of the var- ious documents that the owner and constructor exchange. 163 18.8.1 Written Communication 18.8.1(a)Construction Progress 18.8.1(b)Progress Reports 18.8.2 Job Records BContracting for Business Success,Andrew Cox and lan Thompson,ASCE Publications,1998. Construction Project Administration,Edward Fisk, Prentice Hall,1998. Journal of Construction Engineering and Management (print and CD- ROM},James E.Rowings, Editor,ASCE,1999. >17.3,"Technical Submittals” 18.2 QUALITY OBJECTIVES The RPR is responsible for implementing the procedures specified in the con- tract documents for recording the review and evaluation of quality objectives. In general,construction quality involves two broad areas:materials and work- manship.Typical contract procedures for these two areas of project quality are discussed below. 18.2.1 Materials Materials fall into two broad categories:those that are already in place (in- situ),and those that must be procured.The RPR is responsible for monitor- ing the materials used by the constructor and reporting instances where they do not meet the contract specifications,which typically require conformance to accepted standards.Figure 18-1 provides references to many typical accept- ance standards and information. 18.2.1(a)In situ Materials In situ (natural or original)materials typically include native soils and rocks. Contract documents often call for laboratory testing and engineering evalua- tion of the properties of in situ materials to determine their suitability for proj- ect uses.Such laboratory reports and engineering evaluations become part of the project file.Any re-testing or other follow-up analysis also becomes part of the file. 18.2.1(b)Procured Materials Procured materials are manufactured items,such as structural steel,asphalt, concrete,paint,glazing,or mechanical and electrical equipment.Contract specifications usually provide minimum quality standards,as well as the man- ner of qualification,for procured materials.For example,manufactured prod- ucts,such as an electric motor,may be accepted based on the verification of a brand name and catalog number.However,the specification may require that other types of materials,such as concrete or paint,undergo physical and chemical analysis to verify their quality. Procured materials or products are documented in a file listing the qualifica- tion procedure and the minimum specifications.This includes the type of tests performed,the date a test is performed,the signature of the person perform- ing a test,test results,any nonconformance reports and,if specified,the loca- tion in the structure where the tested material or product is incorporated.Many products,on the other hand,are purchased with performance warranties and certification instead of specific qualification or testing. 18.2.2 Substitutions During construction,requests for substitutions of materials are common dur- ing construction.Thus,most contracts (usually located in the General Conditions)establish procedures for members of the project team to follow in such cases.Substitution procedures usually allow the constructor to pro- pose alternate materials that offer savings in construction time or money,or improvements in quality.Quality substitution procedures call for the design 164 professional to determine if the proposed substitution will achieve the project objectives,as well as who will be responsible for the adequacy,compatibil- ity and quality of the substitute,if approved. Figure 18-1 Sources of Acceptance Standards and Information Element s234RORas Source AHF RR ROTREA Ra seen VWeb AddressScentiaiinmiag Earthwork American Society of Civil Engineers,Geo Institute www.asce.org Association of Engineering Firms Practicing in www.afse.org the Geosciences Concrete American Concrete Institute www.aci.org Portland Cement Association www.portcement.org Prestressed/Precast Concrete Institute www.pci.org American Society for Testing and Materials www.astm.org American Association of State Highway and www.aashto.org Transportation Officials Masonry American Society for Testing and Materials www.astm.org American National Standards Institute Wwww.ansi.org National Institute of Standards and Technology www.nist.gov Masonry Society www.masonrysociety.org Brick Institute of America www.bia.org National Concrete Masonry Association www.ncma.org Timber American Institute of Timber Construction www.aitc-glulam.org National Forest Products Association www.forestprod.org Structural Metals American Institute of Steel Construction www.aisc.org American Iron and Steel Institute www-.steel.org Reinforcing Concrete Reinforcing Steel Institute www.crsi.org Steel Wire Reinforcement Institute www.bright.net/ wwri Asphalt American Association of State Highway and www.aashto.org Transportation Officials Asphalt Institute www.asphaltinstitute.org Painting Steel Structures Painting Council www.paintcoatings.net Electrical Institute of Electrical and Electronic Engineers www.ieee.org National Electrical Manufacturers Association www.nema.org National Electrical Code National Fire Protection Association www.nfpa.org Mechanical!American Society of Mechanical Engineers www.asme.org American Society of Heating,Refrigeration and Air www.ashrea.org Conditioning Engineers American Petroleum Institute www.api.org American Water Works Association www.awwa.org Welding American Welding Society www.amweld.org Lincoln Welding Foundation www.lincolnelectric.comr Skid Resistance American Society for Testing and Materials www.astm.org 165 ASCE Policy Statement 350, wy "Construction Site Safety” U.S.Occupational Safety and Health Administration: www.osha.gov Following the design professional's approval of a substitution,the RPR ini- tiates a formal change order signed by both the owner and constructor incor- porating the substitute material into the contract.The change order delineates the original item,the item substituted,the reason for substitution,who is responsible for this substitution,date of action,and the price adjustment,if any,negotiated as a result of the change. 18.2.3 Tradecraft The quality of tradecraft (tasks performed by construction craft workers)is usually determined by minimum acceptable standards in the contract docu- ments.Standards of measurement have been developed for most physical con- struction tasks.For structural considerations,such as with bearing value of piles,soil compaction,or the tightness of bolts,minimum standards of accept- ance are obtained from leading industry associations (see Figure 18-1).When quality assessments involve a high degree of subjectivity,as with the tradecraft of a concrete wall finish,the RPR relies on observation,experience,and accepted industry practices. Where the quality of tradecraft may be critically important,the constructor may be responsible for building a mock-up to demonstrate that the specified level of quality can be achieved by the installer of a portion of the project. After acceptance,the mock-up becomes the quality standard for related tradecraft. 18.3 JOB SITE SAFETY Safety on the job site is a critical responsibility of the owner.Because safety is inextricably linked to the constructor's selection,planning,design and implementation of construction means and methods,the owner often dele- gates this responsibility to the constructor,who implements a plan for com- pliance with applicable safety practices and regulations. The safety program does not replace the constructor's responsibility for means and methods of construction.Rather,it is to emphasize with the constructor that safety is a primary concern in those means and methods. A coordinated program of safety education and certification for worksite personnel,as well as members of the project team,regulators,media,and other visitors is an effective strategy for reducing the number and severity of accidents.Such programs typically address worksite personal protective equipment,restricted areas,personnel monitoring procedures,emergency noti- fication procedures,equipment operation,construction practices,and other issues. 18.4 PAYMENT The owner's timely and appropriate payment for work accomplished is an important aspect of a good relationship among project participants.The owner depends on accurate estimates by the RPR of the project's cash flow projec- tions to provide adequate funding to support construction progress. 166 Payments are divided into two broad categories:those to the constructor,and those to others.Payments to constructors include regular or periodic payments for originally contemplated work,as well as payment for work completed to address unforeseen conditions. Payments to other participants include those made to the design professional, property owners for real estate and right-of-way acquisition,utility compa- nies,consultants performing laboratory testing,specialty consultants,equip- ment vendors,and other firms or persons performing construction-related tasks that are not the responsibility (according to the contract documents)of the constructor. 18.4.1 Payments for Originally Contemplated Work On most projects,periodic payments for originally contemplated work are made on a monthly schedule,based on the value of work accomplished.On projects with large cash flow needs,the owner and constructor may contract for a more frequent payment schedule,such as weekly or biweekly. In some instances,payment for originally contemplated work is made only once,and in full,when the project is completed.In other cases,the owner may make payments when construction progress reaches predetermined per- centages of completion or milestones.While the timing of payments varies with each project and the agreement between the two parties,monthly pay- ment is the general industry practice. The construction contract establishes responsibility for initiating payment. The constructor is usually responsible for preparing a periodic payment appli- cation that is reviewed and approved by the RPR.On some public works projects,however,the reverse is true. The method used for preparing the periodic payment application depends on the type of contract involved.Payment under the three principal types of con- tracts-unit-price,lump sum,and cost-plus-are described in the following sections. 18.4.1(a)Unit-Price Unit-price contracts are common in public works projects where the quanti- ties of various kinds of materials and work segments are estimated and cannot be known with great precision.Therefore,contracts may be awarded with lan- guage that describes the type and approximate quantity of work to be performed,such as cubic yards of excavation or backfill,or square feet of pavement involved.The actual value of the work is based on a unit price for each item that is included in the constructor's bid or is negotiated. Under unit-price contracts,pay items are structured so that the measured quan- tities involved for each item determine the amount of payment. If the contract documents specify,it may be necessary for the owner to pay for materials that have been delivered but not yet incorporated in project 167 Unit-price contracts are common where the quantities of materials and work segments are not precisely known. structures.For example,the contract may include the cost of reinforcing steel in the price per cubic yard of concrete.The delivery of the reinforcing steel, however,is expensive and therefore a bulk delivery may reduce total costs, even if the steel is incorporated into structures only periodically.(The steel also represents a valuable future asset to the owner.)In such situations,the value of the reinforcing steel is included in payments to the constructor before the steel is actually cast in place with concrete.The RPR generally approves the value of the material after obtaining copies of invoices for the materials from the constructor.Owners often pay a portion of the pay item value for materials delivered but not yet incorporated into the construction. Measures of value of partially completed work include not only the effort or funds expended to date but also the cost to complete.The effective transfer of control of the materials and matters of security also influence the value of partially completed work.The RPR is responsible for recommending payment for only the stated value of a completed item,less the cost to complete it. Although not encouraged,it may be necessary to change or renegotiate a unit price.Unforeseen circumstances such as unknown soil conditions or changes in the materials to be used may alter original quantity estimates.The new unit price may be more or less than the original price,but generally reflects such cost factors as restocking,overhead amortization,and supplier's discounts. Unit price changes may also involve a revision of the contract duration. It is common for the owner to make partial payments for uncompleted unit- price items,as the work proceeds,even though it is not yet complete.In such cases,the RPR is responsible for estimating and recommending payment to the constructor for the value of the completed portion of the unit-price item. Accurate record-keeping and a familiarity with the materials involved are essential in unit-price contracts.The RPR and constructor work together on this effort,developing a periodic assessment of the value of completed work through joint review. 18.4.1(b)Lump Sum In Jump sum contracts,the constructor determines the quantities of materials and work hours and submits to the owner a single lump sum price for the completed project.Typically,it is the constructor's responsibility to divide the contract into various components (known as a schedule of values)that are similar to the categories in unit-price contracts.Mobilization or contract initiation costs are paid as a separate item,if permitted under the contract. The RPR has the responsibility to determine if the various items of work included in the lump sum breakdown are properly balanced to avoid over- payment for completion of early items,a practice known as "front-loading.” For example,on a project where foundation excavation preceded roofing,a constructor could overstate the costs to complete the foundation excavation and understate the cost of the roofing,thereby generating greater cash flow at the beginning of a project.Even though the total final amount of the con- tract is the same,the payment schedule would be unfair to the owner because payment would be made for work that had not yet been completed. 168 18.4.1(c¢)Cost-Plus In cost-plus contracts,the constructor is reimbursed for actual costs plus an agreed-upon rate for overhead and profit.Because the constructor is com- pensated for costs rather than completed work,the emphasis on record keep- ing shifts from the amount of work completed to the costs for the completed work.Under this type of contract,documentation is very important and usu- ally involves submitting a work hour record for each employee (including direct,indirect,and supervisory staff as may be allowed by the construction contract),hours worked,the type of work,and the wages paid.Equipment usage and costs are also submitted.Cost-plus contracts also involve methods to record and file the large quantity of material invoices,delivery slips,and other records that are necessary to verify the costs borne by the constructor. Cost-plus work may be completed within a unit-price or lump sum contract, such as when extra or unexpected work is encountered for which no unit price has been established.This mix of contracting approaches involves complex record keeping and reporting.In such situations,the mixed use of personnel and equipment can be reimbursed to the appropriate pay item on a cost-plus basis. 18.4.2 Retainage One contract provision to help assure constructor performance is retainage, which is the withholding of an agreed-upon percentage of the constructor's earned payment.This percentage is usually based on the work completed to date to minimize the potential impact of any error in quantity estimating,a lapse in meeting quality standards,or construction errors. Retainage is neither a penalty nor a provision to alter the contract.In many cases,retainage is an inducement to encourage timely completion;in others, it provides a means for the owner to ensure that work is completed accord- ing to the contract documents.In either case,retainage is a temporary assess- ment against earned funds that is released promptly after the cause or term of the assessment has been addressed satisfactorily. The releasing of earned funds fully and promptly,while withholding unearned funds,poses a challenge to contract administrators.In some cases,the post- ing of securities or other items of value in lieu of retainage,which may be placed in escrow under the owner's control,or procedures that allow the con- structor to earn interest on retained funds,are acceptable forms of retainage. Such escrow account payments are not released until the project is accepted and final payment made. 18.4.3 Liquidated Damages Liquidated damages are intended to compensate the owner for anticipated costs incurred and potential loss of income if the project is not substantially complete within the time specified in the contract documents.Some courts have ruled that liquidated damages should run until the project is fully complete. 169 In cost-plus contracts,the constructor is reimbursed for actual costs plus an agreed-upon rate for overhead and profit. Liquidated damages consolidate,or "liquidate,”anticipated delay damages to a specific sum. Liquidated damages are based upon an estimated monetary loss to the owner given the information known at the time of contract formation,and are usually expressed in dollars per day.Liquidated damages are incorporated in con- tracts if the parties recognize that a precise determination of the owner's delay damages is not possible.This is why it is desirable to "liquidate”the dam- ages;that is,consolidate them to a specific sum.Once established in the contract,the liquidated damages clause is enforceable regardless of the actual delay damages that the owner may incur. Liquidated damages can also work to the constructor's advantage.If the owner's actual delay damages exceed the liquidated damages amount,the owner cannot recover the difference,as the liquidated amount has established how much the owner can recover.There is a commonly held misconception that liquidated damages are offset by equal bonus clauses. Liquidated damages can be assessed only when the cause for the delay can be attributed to acts or omissions by the constructor.If a project is delayed for reasons beyond the control of the constructor,then sufficient extensions of time are granted under a change order.In any case,because of variations in state laws regarding liquidated damages,it is recommended that knowl- edgeable counsel be consulted with regard to their application and enforceability. 18.4.4 Bonus Clauses Bonus clauses (incentive clauses)are categories of cost incentives.Bonuses may be prescribed for progress determinants as well as for quality determi- nants.When used as progress incentives,they should not be confused with liquidated damages.A bonus is not necessarily related to actual benefits as a result of finishing the project early or late.They are a predetermined sum defined by contract and are proposed solely as an inducement. Bonuses for quality determinants usually are based on some statistical eval- uation of a measurable quality attribute (the smoothness of pavement,the strength of concrete,or the density of compaction).Such clauses are an excel- lent means of rewarding constructors for high quality work. 18.4.5 Payments for Work Related to Unforeseen Conditions Payment for work related to unforeseen conditions on the site is generally made when the work is completed.Some contracts call for timely notifica- tion of changes or unforeseen conditions.The RPR and constructor work together to determine the payment,using the complete record of change orders as a basis for negotiation.Unforeseen work may involve additional rights-of- way,utility,surveying,or other inspection costs. 18.4.6 Non-Constructor Invoices The certification and recommendation for payment of vendors'invoices are important steps in managing project costs.All such non-constructor invoices- 170 whether for utility relocations,purchase of equipment by the construction organization,or the testing of construction components-should show: *The date that the purchase was made or the work was performed; ¢The unit prices or costs involved; ¢The specifications or other quality criteria used in the work. 18.5 CONSTRUCTOR SUBMITTALS The RPR receives,reviews,and processes the constructor's construction doc- umentation and submittals specified in the construction contract. Contract documentation typically includes payment and performance bonds, proof of insurance coverage,the names of proposed subcontractors,suppli- ers and manufacturers,and estimated cash flow needs.Submittals may include shop drawings,catalog cuts,material certifications,requests for substitution, requests for partial payment,safety-related documentation,schedules and progress reports. The RPR tracks the date the documentation or submittal is received,the date any action is due,the person with the responsibility to act on the submittal, and the status of the submittal at any given time. 18.6 CHANGE ORDERS By its nature,construction involves responding to changing conditions and circumstances.Even under the most ideal circumstances,contract documents cannot provide complete information about every possible condition or circumstance that the construction team may encounter.Variations will occur in sub-surface conditions,the nature of materials,design,fabrication,and erection.Quality construction is better served when the project team has the flexibility to revise the original project plan as construction proceeds.These changes help to produce a facility that is consistent with the project objec- tives.The formal amendments to the contract to address unanticipated conditions or circumstances (i.e.,owner-initiated changes)are known as change orders,extra work orders,or work change directives. The prompt identification of the need for a change order helps both the owner and constructor avoid unnecessary disputes,associated work disruption,cost increases and schedule delays.In many cases,it is more cost effective for con- struction to proceed before the details and costs of implementing the change can be negotiated and formalized.Typical project changes involve revisions of original materials,design,or fabrication.Extra craft labor may also be necessary. Change orders may also acknowledge changes in expected construction progress when no physical impediment to construction has been encountered. Weather delays are a common reason for such change orders. Therefore,the judgment and skill of the RPR are crucial to the change order process.While the RPR works to obtain formal approval of change orders as 171 >17.2,"Contract Documentation” >17.3,"Technical Submittals” Construction Contract Claims, Changes and Dispute Resolution 2nd Edition,Paul Levin,ASCE Publications, 1998. It is a benefit to project quality to document change orders as completely and as quickly as possible. >Chapter 5,"Coordination and Communication” soon as possible,a preliminary written order may be acceptable until the change documents are formally approved (though this is not recommended). In other cases,the contract documents may not call for formal change orders if the modification will result in the expenditure of less than a certain dollar amount. In general,it is a benefit to project quality to document change orders as com- pletely and as quickly as possible.The owner and constructor sign each change order (after appropriate review by the design professional).Change orders are usually numbered,dated,and may include revised plan sheets,sketches,spec- ifications,and quotations.When appropriate,the change order should also address the impact of the changed work on the project schedule.Some changes may not be within the scope of the original contract;in such cases,the con- structor has the right to reject a change order. On projects with a high potential of encountering unforeseen conditions,such as building renovations,environmental remediation or underground work,the owner benefits from budgeting for change orders as part of contingency costs. Change order contingencies provide a more realistic picture of project costs and reduce the potential for disagreement among team members. 18.7 COORDINATION OF ACTIVITIES The owner's RPR is responsible for coordinating the activities of construc- tor,safety monitors,testing agencies,private and/or public utility companies and other entities having direct contracts with the owner. 18.8 DOCUMENTATION While verbal communication and an ability to work with a variety of people are essential skills for the RPR's administration of the construction contract, the documentation of communication and decisions is essential.Such impor- tant items as safety,payment,and overall quality depend on documentation. This section describes two broad categories of project documentation:writ- ten communication and job records. 18.8.1 Written Communication Written communication includes memos and correspondence among proj- ect participants,letters to and from outside parties,reports,meeting min- utes,memoranda to the project file,and written summaries of telephone calls.E-mail,while often viewed as informal communication,is a form of documentation. The RPR is responsible for maintaining subject matter and chronological files of relevant correspondence and other written material.The following sections describe these types of written communication. 18.8.1(a)Construction Progress Contract documents generally call for the constructor to submit a progress schedule before construction commences.The schedule aids the RPR in estab- 172 lishing cash flow needs,assessing personnel demands,and coordinating con- tract work with adjoining work activities by other contractors. The constructor may communicate intended progress in several formats (see Figure 18-2).The most common are schedule formats Gantt charts,critical- path method (CPM)schedules or "Pert”schedules,and "S”curve charts that relate progress to cumulative cost.The presentation of information in CPM or Pert schedule format is known as network analysis. Figure 18-2 Sample Schedule Formats -1]-aoe =} ii if t j tj tt |_t Critical Path Method Bar charts are the simplest schedules to prepare and evaluate,because they show time on the horizontal axis and the various items of work on the vertical axis.Bar charts can become more detailed and complex simply by refining the time scale.The use of weeks rather than months,or days rather than weeks, improves detail.The contract documents specify the degree of schedule detail. "S”curves are prepared by combining the values (e.g.,cost,time or quan- tity)of the elements of a schedule for the period shown on the schedule.These periodic totals are accumulated to show a rising "S”pattern curve to predict job progress.Although such curves usually are prepared by accumulating dol- lars,they also can be created by accumulating working hours or any other element of construction. In addition to time,schedules can present interrelationships among various construction elements.These elements are represented by one-dimensional arrows.The nodes,representing the tail and head of the arrow,can be tabu- lated for early or late start,or early or late finish,to present a realistic picture of the variability that is common to construction (see Figure 18-3).As with 173 Figure 18-3 Network Schedule Analysis bar charts,network analysis is not inherently simple or complex.The com- plexity is actually derived from the complexity of the project and the level of detail desired or dictated.The information developed through network analy- sis can be effectively displayed in bar chart form. On larger projects,the owner may wish to consider a periodic independent review of the progress schedule so that an impartial assessment of any delays can be made while the project is ongoing. 18.8.1(b)Progress Reports Progress reports communicate construction status.This involves the com- parison of actual progress to that forecast in the submitted schedule.There are three common types of construction progress reports-detailed reports, summary reports,and subjective reports. Detailed reports are prepared on a regular basis (usually daily),and involve the tabulation of each work item accomplished during the defined period. Detailed reports form the substance of the contract administration file and are an important resource for payment requisitions,dispute resolution,and job history. Summary reports contain information from each of the detailed reports and relate that information to project objectives.Summary reports may be pre- pared for any period of time,but are usually completed on a monthly basis. Subjective reports,also known as exception reports,are filed when unusual or significant events occur.For example,a summary report may omit a detailed explanation of why some anticipated work was not completed.A sub- jective report may be prepared to explain why such deviation from schedule was necessary.Subjective reports are usually filed in the form of a letter that the RPR transmits to parties that are likely to have an interest in the event. 18.8.2 Job Records The job record includes other documents and written materials.The job record includes design and shop-drawing logs,photographs (which may be filed with the progress reports),and certified payroll records required by a federal or other government agency.Additional job record information includes non- conformance reports on discrepancies between "as designed”and "record”or "as-constructed”drawings,as well as change orders.The logging of this infor- mation is beneficial in the event of a legal challenge to accuracy of the completed design. Shop Drawing Log:The shop drawing log shows a number iden- tifying the individual drawing,drawing title, date it was received,to whom it was for- warded for review,date it was returned,and approval status. 174 Job Photograph Log:Job photographs should have an identifying date and number photographically developed as part of the print,showing when the picture was taken.That number provides a reference to information in the job photography log about the photographer,direction the camera was pointed,and activity shown. Bid documents:Bid documents generally become part of the job record.These documents include plans, specifications,bonds,and other similar affi- davits that may have been requested when the contract was awarded.Record documents showing revisions and additions to the origi- nal plans and specifications are maintained as a part of a job record. Certificates of Completion:Upon project completion,many agencies require a release or affidavit (or sometimes both)certifying that work has been completed in accordance with the contract documents and no payment is outstanding.Certificates of completion may include information about the location or completeness of record draw- ings,as well as lien or bond releases or addi- tional guarantees that all project payments appropriate.It is the responsibility of the RPR (and in some cases,the constructor)to collect and present releases,certifications,and affidavits. SUMMARY The effective administration of the construction contract is a key aspect of achieving quality in the constructed project,and the RPR is the central fig- ure in this effort.The RPR acts on the owner's behalf,performing the duties and responsibilities assigned to the owner in the construction contract.The RPR may oversee quality concerns related to materials,the quality of con- struction tradecraft,job site safety,payment,unforeseen conditions,non-con- structor invoices,construction contract submittals and documentation,change orders,and worksite coordination.The RPR builds and maintains the project record on which most decisions are based.The RPR works hand in hand with the constructor and design professional to generate and process the wide array of information that is necessary to document compliance with the construc- tion contract documents. The RPR depends on the cooperation and support of each project participant to successfully administer the construction contract.O 175 Chapter 18:Typical Construction Contract Administration Typical Responsibilities Responsibility Design Design- BO Owner Professional Constructor Builder Designate Resident Project Representative (RPR)e ©@© Overall administration of the ©©e © construction contract Ensure quality of materials ©e and tradecraft Maintain job site safety e ©e*@* Make payments according to contract r }@ © Process constructor submittals @ @ @ Process change orders e 'O)©© Coordinate construction activities e @ Generate,review,and approve @©@ e@ e contract documentation Archive contract documents e @ @ @ *As designated by owner @ =Primary Responsibility ©=Assist or Advise ©=Review 176 CHAPTER 1 9 OPERATION AND MAINTENANCE ee operation and maintenance of a completed project is closely In this chapter associated with its level of quality.Even if design and construction pro-19.1 Achieving Quality in O&M ceed smoothly,overall quality may suffer if the project owner or users find 19.2 O&M during Planning and the project too costly or cumbersome to operate and maintain.Operation and Design maintenance (O&M)characteristics affect a project's reliability,durability, efficiency,and life-cycle costs.O&M can also affect the environment,pub- lic health,user safety,and other external aspects of the completed project. 19.3 O&M during Construction 19.4 O&M during Start-Up 19.4.1 Organizing for Start-Therefore,the project team benefits by giving careful considerations to O&M Upobjectivesduringtheproject's planning and design,construction,and start-19.4.2 Start-Up Program and up phases.Activities In most cases,the owner operates and maintains the project upon completion 19.5 Operation and so may wish to consult experienced operators of similar facilities as work proceeds.The owner may designate a special O&M representative to advise the project team on how to complete the product in a manner that best achieves the project's O&M needs. This chapter discusses activities that contribute to quality in O&M during four project phases: 1.Planning and Design Reviewing project configuration,functions,and 2.Construction 3.Startup 4.Operation processes Observing construction activities related to O&M to ensure consistency with design specifications and intent. Verifying,testing,and accepting functions. Operating and maintaining the completed project, including fine tuning,operational enhancements, and scheduling maintenance activities. This chapter also discusses organizational arrangements that the owner may wish to make to help ensure that O&M concerns receive appropriate consid- eration throughout the project phases noted above. 19.1 ACHIEVING QUALITY IN 0&M The level of effort to achieve quality O&M performance depends on the size and complexity of the project.On large projects,the owner often benefits from 177 On large projects,the owner often benefits from including operation staff and maintenance experts in all phases of the project. >Chapter 25,"Value Engineering” including operating staff and maintenance experts in all phases of the proj- ect.The owner's internal O&M staff can often provide the design professional with crucial input regarding equipment,operating and control systems,man- ufacturers,and other information.On smaller or less complex projects,the design professional,constructor,equipment manufacturer,suppliers,or oth- ers often have sufficient experience with O&M issues. When making contractual and staffing arrangements,the owner's options for ensuring consideration of O&M objectives during appropriate project phases include the following: ¢Assign an internal O&M staff person as the project O&M coordinator. This person advises the project team on O&M issues related to plan- ning,design,construction,and start-up.Ideally,the O&M coordinator has practical experience with similar projects. ¢Contract with the design professional,design-builder,constructor or an independent consultant to provide a qualified O&M coordinator. *Delegate internal O&M staff,preferably the people who will ultimately be responsible for O&M on the completed project,to assist project team members in observing and/or inspecting construction.This arrangement provides an opportunity for O&M personnel to become familiar with the project before start-up and operation. ¢Delegate internal O&M staff to assist during project start-up. ¢Contract with the design professional,design-builder,constructor or independent consultant to review and advise on O&M programs for a specified period after the project begins operating. Under any of these options,the owner benefits by specifying the roles and responsibilities of all project participants during the planning and design,con- struction,and start-up phases of the project in their respective contracts. 19.2 O&M DURING PLANNING AND DESIGN In early stages of project planning,and sometimes during preliminary design, the owner and design professional make decisions that have a lasting impact on O&M.These include selecting the site,defining the type of structure to be built,determining access points,choosing equipment,and many other deci- sions about individual project elements.Given the potential long-term impacts of these decisions,the project team can enhance project quality greatly by consulting with the project O&M coordinator during the design phase. As design proceeds,the project team benefits from one or more reviews focus- ing on O&M.The number and frequency of these reviews may vary with the size,complexity,and function of the project.The review(s)may be simple, informal discussions between the owner and design professional.On more complex projects,it may be necessary to set up special review teams that include the O&M coordinator,operations specialists,the design professional, constructor (or design-builder,if applicable),construction specialists,and others.Such comprehensive reviews are typically incorporated in broader project reviews,such as value engineering studies. 178 Operations and maintenance review considerations include: Physical Plant:Size and layout of facilities;special accommodations for people and equipment,safety and security con- siderations;maintenance needs;specialized services, such as laboratory and chemicals;amenities for per- sonnel such as dining,meeting,and shower facili- ties;lighting;heating,ventilation and air conditioning (HVAC);future expansion;land uti- lization;equipment layout and control systems; access for deliveries and shipments;system flexibil- ity and redundancy;the owner's O&M requirements at other facilities;and manufacturer-supplied mate- rials,training,and spare parts. Control Strategies:|Manual backup controls,as well as supervisory con- trol and data acquisition (SCADA)systems. Cost:Annual costs for building and equipment mainte- nance,labor,energy,supplies,utilities,annual per- mits,site maintenance,and landscaping. Environmental:Odor control,noise abatement,air and water quality protection,hazardous waste disposal,and other closely monitored impacts to facility users and abutters. Safety:Equipment,chemicals,protective devices,sprinklers, clothing,staff training,and risk management. Budget and Staffing:Revenue sources,expenses,hours of operation,num- ber of employees,professional qualifications,and prevailing market conditions. During the project planning and design phases,the project team determines needs,constraints,and specifications related to the performance,operation, and maintenance of the proposed project.The project team also develops draft O&M budget and staffing plans.These O&M needs are incorporated into the project plans and specifications,which typically include equipment per- formance criteria,repair and replacement warranties and manuals,spare parts information,operator training,and equipment start-up needs. An O&M manual created by the project team can be of special value for com- plex projects.Such manuals usually include process descriptions,design cri- teria and equipment specifications,equipment purpose,operating parameters, potential problems and solutions,emergency procedures,safety,and other information.The O&M manual is often a regulatory requirement for a project. 19.3 O&M DURING CONSTRUCTION As construction gets under way,more information becomes available for the O&M staffing plan and budget.The project team and O&M coordinator have 179 Providing the flexibility to adapt the design during construction to meet evolving O&M objectives is an important aspect of project quality. the opportunity to inspect and witness the installation and testing of materi- als and equipment,observe project elements that may not be accessible after completion,such as underground utilities and electrical conduit routings,and structural support elements.Providing the flexibility to adapt the design dur- ing construction to meet evolving O&M objectives is an important aspect of project quality,as is the constructor's experience with relevant O&M issues. In most cases,owners strive to have their O&M staff members in place before project start-up-often before construction is complete.To meet this goal,the O&M coordinator may begin assisting the owner in planning,budgeting,and training for O&M during the project construction phase.Project team members and future O&M staff also review information from manufacturers for inclu- sion in the O&M manual,develop O&M training programs,and prepare for start-up.The project O&M coordinator and O&M staff typically begin to take more active roles in project decision-making during the construction phase. Typical O&M-related activities during construction include: ¢Assembling equipment information,including warranties,operating instructions,and maintenance needs; ¢Maintaining up-to-date plans and specifications that reflect change orders,actual conditions and other information pertinent to O&M; ¢Coordinating and preparing for the delivery and storage of spare parts, tools,and equipment; *Preparing a work plan for project start-up. As construction nears completion,appropriate project team members (as defined in the construction contract)conduct acceptance tests of various ele- ments and begin maintaining them until project start-up begins. 19.4 O&M DURING START-UP Project start-up involves activities to demonstrate that the completed facility performs according to specifications.Start-up gives the O&M staff the unique opportunity of becoming familiar with the project and its components with the support of the project team,in particular the design professional,design- builder (if applicable)and constructor.During this phase,the O&M staff continue to take on increasing responsibility as the project progresses toward full operation.However,it is usually the case that certain contractual respon- sibilities,including the responsibility for security,operations,safety,mainte- nance,heat,utilities and insurance coverage are not transferred to the owner until the date of substantial completion of the work as set forth in the contract documents. Project start-up can be as simple as cutting the ribbon at the dedication cer- emony for a new highway.The start-up of complex projects,such as power plants,petrochemical facilities,or wastewater treatment plants,may require the preparation of a start-up plan.Such plans typically address procedures, sequencing and responsible personnel for commencing operation,and may include extensive organization and training of representatives from the owner, other project team members,and specialty vendors. 180 19.4.1 Organizing for Start-Up The start-up plan assigns responsibilities to project participants for organiz- ing and leading related activities.Start-up responsibilities are often specified in contractual agreements among project team members.The specific proj- ect objectives dictate in large measure the project team member most likely to lead the start-up process: Pe Owner titeeek Design Professional E2822 ConstructorSx Leads start-up on proj-Usually leads start-up Leads start-up on ects where major equip--_on projects where the design-build or ment is furnished or design team is responsi-"turnkey”projects, specified;on projects ble for the O&M man-where the owner dele- that require multiple ual and training.gates more authority constructor and design during construction. professional assign- ments;and on projects where joint site occupa- tion requires coordina- tion of construction and O&M. When the responsibility for start-up has been established,the start-up team is formed with representatives from the O&M staff,specialty vendors and project team,including the design professional,the constructor (or design- builder),and the owner. The start-up plan may outline the interaction and exchange of information among the principal parties,as well as planning,scheduling,testing,and other activities.The start-up plan is geared to meet the needs of the particular proj- ect,and it benefits from a simple and direct style that makes use of standard forms,checklists,and tabulations. 19.4.2 Start-Up Program and Activities The start-up program itself involves a range of activities,including the prepa- ration and review of start-up activities and procedures,determining con- struction completion status,scheduling,system testing,making corrections, reviewing final inspection reports and closeout submittals. The start-up program and related activities are geared to demonstrate the func- tional integration of the project's constructed systems,which include: Structural:Foundations,slabs,bearing walls,and frames. Envelope:Roofs,curtain walls,and ceilings. Mechanical/Electrical:Systems for water,waste disposal,heat- ing,ventilating,air conditioning,con- veyances (elevators),and fire safety;and 181 >3.5,"Design-Build Variations” electrical systems (which may power mechanical systems). Process Systems:Specialized equipment supported by the mechanical and electrical systems for man- ufacturing,refining,or treating products. Interior or Architectural:Habitable components such as partitions, suspended ceilings,floors,furnishings, and wall coverings. Exterior:Parking lots,pedestrian access,landscap- ing,storm water drainage,utilities,and transportation systems. Control and Communications:Specialized hardware or computer soft- ware for supervisory control and data acquisition (SCADA)systems,digital/ analog systems,voice and data systems, and wire/wireless/optical fiber systems. Start-up activities are generally based on the premise that elements of the proj- ect systems meet contract specifications.Therefore,the specific start-up activ- ities are designed to do the following: ¢Determine that each individual component is fully operational; ¢Determine that individual components operate collectively together as specified and in accordance with project objectives; ¢Provide a means of training O&M personnel to safely operate each com- ponent and the entire project; *Validate the O&M manual including manufacturer's instructions and project specific procedures; ¢Check to ensure up to date documents are readily available for refer- ence,such as plans,specifications,and drawings; ¢Serve as the milestone marking the completion of construction and the start of operations. 19.5 OPERATION Project operation is the primary responsibility of the O&M staff,although the project team may be obligated to make appropriate staff available to support and assist for an initial operating period. Depending on the size and complexity of the project,the O&M staff may work with project team members for the first few months or years of opera- tion,often on enforcing equipment warranties and correcting defects.In par- ticular,the O&M staff may wish to consult the design professional to help clarify operating and maintenance manuals,fine tune operations,and evalu- ate performance with respect to design criteria and project goals.The O&M staff may also wish to work with the constructor and manufacturers on war- ranty issues,minor improvements or revisions. 182 SUMMARY Project quality in O&M depends on the active participation of the people who will be involved with O&M activities long after the project team has disbanded.Designating a project O&M coordinator early on,as well as estab- lishing organizational responsibilities for O&M tasks during start-up,are effective strategies for ensuring that the project team addresses O&M goals in a timely and cost effective manner during all phases of project development.0 Chapter 19:Operations and Maintenance Typical Responsibilities Responsibility Design Design- ia Owner Professional Constructor Builder Assign O&M coordinator and staff t )©@®© Develop O&M program e ©@ © O&M design review(s)O @ ©@ Handle construction phase information O r e @ gathering,coordination;prepare start-up plan Prepare O&M manual O e*e*t ) Designate start-up leader e @®e e@ Oversee start-up activities ©@ e@ e@ Perform operations @ @ @®@ *May be assigned to either design professional or constructor @ =Primary Responsibility @ =Assist or Advise ©=Review 183 CHAPTER 2 0 QUALITY ASSURANCE AND QUALITY CONTROL he term "QA/QC,”short for quality assurance and quality control,is a buzzword on constructed projects.Yet this acronym is often uttered by people who aren't quite sure what it means. This is understandable,as quality means different things to different mem- bers of the project team.Owners,design professionals,and constructors place different value on the durability,operational features,configurational flexibility,initial capital investment,life-cycle costs,and other characteris- tics of projects. In this Guide,quality is defined as the fulfillment of project responsibilities in the delivery of products and services in a manner that meets or exceeds the requirements of the project participants (see 1.4,"Defining Key Terms”). This chapter discusses some of the key activities and initiatives that the owner, design professional,and constructor may undertake to assure that project design and construction meet the quality goals and objectives of the project team under traditional design-bid-build project delivery.Where appropriate, this chapter also notes how the use of alternative project delivery systems may affect the application of QA/QC measures. Quality Assurance:-Planned and systematic actions to help assure that project components are being designed and con- structed in accordance with applicable standards and contract documents. Quality Control:The review of project services,construction work, management,and documentation for compliance with contractual and regulatory obligations and accepted industry practices. 20.1 THE OWNER'S ROLE The owner is the central figure in promoting initiatives and activities to achieve project quality.In the case of large or complex projects,owners often benefit from the assistance of other team members in specifying proj- ect quality objectives. There are two general types of QA/QC activities:those geared to improve design,and those for improving construction.Owners have several options for developing QA/QC programs in either category: 185 In this chapter 20.1 The Owner's Role 20.2 The Design Professional's QA/QC Process 20.2.1 General Elements 20.2.2 Evolution of Design QA/OC Activities 20.2.2(a)Pre-Design 20.2.2(b)Schematic Design 20.2.2(c)Design Development 20.2.2(d)Contract Documents 20.2.2(e)Bidding or Negotiating 20.2.2(f)Construction 20.2.3 Design Reviews and Audits 20.2.4 Quality Control During Bidding or Negotiation 20.2.4(a}Pre-Bid Conference 20.2.4(b)Bid Evaluation 20.3 The Constructor's QA/OC Process 20.3.1 General Elements 20.3.2 Meeting Contractual! Provisions 20.3.3 Project-Specific Needs Construction Inspection Handbook:Total Quality Management4th Edition, James O'Brien,Chapman & Hall,1997. The International Organization for Standardization (ISQ)provides quality guidelines and certification currently known as ISO $000. ty www.iso.ch ¢Supply a project-specific QA/QC plan to the design professional and constructor with instructions to tailor their existing generic QA/QC plans to conform to the owner's plan; ¢Require the design professional and constructor to adapt existing generic QA/QC plans to the project objectives; ¢Require the design professional to write a design QA/QC program; ¢Require the constructor to write a construction QA/QC program. For most design-bid-build projects,the owner engages the design professional before the constructor joins the team.The owner's pre-construction involve- ment with the design professional includes defining the project services required,negotiating the agreement for professional services,and defining project quality objectives.The owner and design professional typically discuss the elements of the design QA/QC plan during this phase.This initial devel- opment of QA/QC concepts between the owner and design professional also affects the constructor,as many QA/QC goals and expectations carry over to the construction phase.In some cases,the owner and design professional pro- duce a quality manual.A written manual is recommended for major projects. 20.2 THE DESIGN PROFESSIONAL'S QA/QC PROCESS The design professional is responsible for implementing a QA/QC plan for the design phase that meets the terms of the agreement for professional serv- ices.The owner reviews and approves the plan,and receives appropriate doc- umentation of the design professional's QA/QC activities as work proceeds. 20.2.1 General Elements QA/QC activities for design professionals typically include measures to enhance creative processes,clarify communication among team members, and develop project concepts to a level of design detail sufficient for the con- structor to effectively transform the design into physical structures. Most design professionals already have QA/QC plans for typical design activ- ities in place.The design professional usually adapts and expands the exist- ing program to meet the unique objectives of the project at hand. sate.Typical Design Professional QA/QC Program Items 7843 ¢A sufficient number of staff mem- bers with appropriate experience. *Communication and review opportu- nities with the owner to allow the design team to fully understand the owner's project priorities. «Communication among design team members. ¢Confirmation of field,regulator,and safety conditions that may affect design. Confirmation of the owner's satisfac- tion with design activities during the design process. Preparation,review,and coordina- tion of designs,drawings,cost esti- mates,and specifications. The scheduling of design reviews, audits,and progress reporting as appropriate for internal control within the design team. The inclusion of specialty advisers on construction,operation and main- tenance,and design who are not part of the day-to-day design effort. 186 Typical design professional QA/QC plans call for the submission of reports and supporting documentation at specified intervals,usually at the comple- tion of a major design milestone. 20.2.2 Evolution of Design QA/QC Activities The design professional's QA/QC activities evolve with the advance of proj- ect design.Therefore,the design professional and owner benefit from a QA/QC plan that provides the flexibility to focus on meeting the owner's project quality goals during different phases of a project.These phases and associated activities are discussed below. 20.2.2(a)Pre-Design Pre-design consists of the initial actions of the owner and the design profes- sional.During this phase,the two parties define their relationship,establish project parameters,and negotiate the agreement for professional services.In addition,the owner and design professional agree on a project-specific QA/QC plan during this phase. 20.2.2(b)Schematic Design During this phase,the owner and design professional develop a written project program based upon the executed agreement to guide design during subse- quent phases.The project program establishes design parameters,constraints, space and regulatory guidelines,and procedures for communicating with the owner.The design professional makes schematic studies to define project out- lines and develops preliminary opinion of probable construction costs.QA/QC activities during this phase include the investigation of design alternatives that satisfy the project program.These investigations involve in-house project con- cept reviews,as well as reviews with the owner.An important element of QA/QC is owner acceptance of a schematic design report prepared by the design professional.: 20.2.2(c)Design Development After the owner approves the schematic design report,the design professional prepares design development drawings and outline specifications.During this phase,the owner and design professional seek review and comment on the design from key stakeholders,such as regulatory agencies.QA/QC activities during this phase include the refinement of design alternatives and cost esti- mates to confirm that they satisfy the project program.An important element of QA/QC is the approval of the design development report prepared by the design professional.Following this approval,the design is "frozen,”after which no more significant changes are allowed so that the contract documents focus on a single design. 20.2.2(d)Contract Documents With the design frozen,the design team maintains control over changes so that they may produce consistent technical specifications and other con- struction documents.These activities usually require further reviews,design and cost refinements,and the filing of contract documents with appropriate authorities.Elements of the constructor's QA/QC plan are mandated in the 187 The design professional and the owner benefit from a QA/QC plan that provides the flexibility to focus on meeting the owner's quality goals during different phases of a project. >18.1,"Resident Project Representative (RPR)” >Chapter 22,"Peer Review" Design reviews allow the owner to make timely requests for clarification of design information before the design professional submits final documents for approval. contract documents as they define standards and materials of construction, performance and testing of equipment,and related matters.Design QA/QC activities in this phase include detailed checking of computations,drawings and quantity take-offs and a review of pay items and specifications.They will also involve reviews to assess constructability.The owner and his or her legal counsel should review and approve the language in the contract documents. 20.2.2(e)Bidding or Negotiating Bidding is a relatively short phase in the pre-construction process,but one that requires close monitoring on the part of the design professional to ensure proper documentation and quality control procedures.QA/QC activities in this phase include responding to questions from the bidders,review of the bids received for conformance with the requirements of the bidding docu- ments,and evaluation of the bid tabulations. 20.2.2(f)Construction During this phase,the owner designates a resident project representative (RPR)to administer the construction contract.The design professional has varying degrees of responsibility according to whether the design professional will be acting as the RPR and the terms of the owner-design professional agreement.The constructor assumes a primary role in fulfilling the QA/QC obligations assigned under the contract documents.During the construction phase,the design professional's QA/QC role includes,at a minimum,the tech- nical review and approval of constructor submittals under the contract.With respect to quality,the RPR is responsible for documentation of performance and qualification tests and other duties as specified by the QA/QC plan. 20.2.3 Design Reviews and Audits QA/QC plans should include design reviews or audits during the contract documents phase.These do not replace the design team's regular ongoing checking to identify and correct discrepancies in dimensions,incorrect notes and references to details on plan sheets,conflicts between plans and specifi- cations,or other similar problems.Rather,design reviews or audits assure appropriate design quality by identifying unsound concepts,analyzing constructability,eliminating redundant activities,providing benchmarks for cost and schedule,and aiding interdisciplinary coordination. The design review is an internal quality control procedure usually carried out by members of the design team and a review board with relevant experience. Design audits,if implemented,are performed by individuals who are not members of the design team. Prior to convening,the review or audit team usually receives appropriate mate- rial from the design team leader.The review or audit team and the design team then meet to discuss the project's relevant design concepts.While the docu- mentation of these reviews is important,detailed records or audio recordings of conversations is usually limited to encourage candor among participants. 188 Design QA/QC provides the owner with the opportunity-and responsibil- ity-to review the design.Such reviews allow the owner to make timely requests for clarification of design information or for supplemental design information before the design professional submits final documents for approval. 20.2.4 Quality Control During Bidding or Negotiation The design professional's QA/QC responsibilities during the bidding or nego- tiation phase,which may affect the quality and integrity of the bidding process, include the pre-bid conference,responding to questions from the bidders and bid evaluation. 20.2.4(a)Pre-Bid Conference The pre-bid conference,along with a tour of the job site,is an important intro- duction to the project for potential bidders.The primary emphasis of the qual- ity control program during pre-bid activities is to provide accurate and forthright information about project conditions and the bidding documents. The pre-bid conference is an opportunity for bidders to ask questions about site conditions and the bid documents.To ensure fairness to all bidders,the owner and design professional issue clarifications or supplementary infor- mation in addenda to the bid documents.Addenda are issued with receipt acknowledged by document holders and with sufficient time allowed to per- mit incorporation in the bidder's submittal. 20.2.4(b)Bid Evaluation The owner's evaluation and analysis of construction bids requires careful review to ensure that each bidder has complied with the bid requirements. The owner may find it useful to enter the bid amounts from each bidder (and for each project element,if appropriate)in a spreadsheet to simplify evalua- tion.This systematic approach to evaluation also helps reveal errors in the bids. 20.3 THE CONSTRUCTOR'S QA/QC PROCESS The constructor is responsible for implementing QA/QC during the con- struction phase to meet the terms of the owner-constructor agreement. Additional QA/QC elements may be added in the constructor's own interest in avoiding cost overruns and schedule delays. In some respects,the constructor's QA/QC requirements are easier to for- mulate and implement,as most contract quality provisions focus on readily measurable physical properties or quantities.However,the constructor's QA/QC plan is often quite complex because the constructor is responsible for the activities of subcontractors,material suppliers,manufacturers,fabricators, and vendors-as well as his or her own activities.The constructor must also take into account the interest and participation of public agencies that enforce building codes,oversee the handling of toxic and hazardous materials han- dling,enforce storage and disposal regulations,grant permits,and enforce other regulations that affect construction. 189 Additional design- development phase reviews may benefit project quality as design proceeds.At a minimum, owners and designers usually hold a final review when design completion reaches approximately 90 percent. The constructor's QA/OC plan can be quite complex,as it involves subcontractors,suppliers, vendors,and others. Implementing Total Quality Management in a Construction Company, Associated General Contractors of America, 1993. >17.3,"Technical Submittals” 20.3.1 General Elements The constructor usually adapts and enhances a generic QA/QC program to meet any special project objectives or owner requirements.The program is geared to ensure conformance with applicable specifications and plans with respect to materials,quality of tradecraft,construction,finish,and functional performance. The quality management procedures in this generic program focus on improv- ing thought processes,clarifying communications among subcontractors,and translating the plans and specifications that define the project into physical structures and systems. <aEESTypical Constructor QA/OC Program Items @eeisareEn ¢Recruiting and assigning a skilled *Quality control testing plan work force *Documentation of quality control ¢Quality control organization activities ¢Project progress schedule ¢Procedures for corrective action ©Submittal schedule when quality control and/or accept- .ance criteria are not met¢Inspections The RPR reviews the constructor's QA/QC program before the start of any production,construction,or off-site fabrication. 20.3.2 Meeting Contractual Provisions The contract documents represent the minimum level of quality to be achieved by the constructor.They define standards and materials of construction,expec- tations for the execution of the work,performance criteria and testing of equipment assemblies and systems,and the documentation necessary to demonstrate that these contract provisions have been met. The constructor's organization and execution of quality control activities in the preparation and processing of submittals required under the contract and the QA/QC program are essential to achieving a smooth workflow.QA/QC measures are geared to avoid delays by subcontractors,the constructor,design professional,the RPR,or owner during the contract submittal,review,and approval processes.The constructor,supported by subcontractors,suppliers, and vendors,is responsible for submitting complete and technically accurate documentation as required under the contract.Attention to these responsibil- ities on initial submittals is an essential aspect of the constructor's ability to maintain the schedules and procedures agreed upon with the owner.The design professional also plays a key role in this process,typically reviewing the constructor's submittals. 20.3.3 Project-Specific Needs The constructor's adaptation of the generic QA/QC plan to meet project- specific objectives usually includes: ¢Measures to ensure that subcontractors are qualified,certified,and/or licensed as required; 190 ¢Procedures for the inspection,control,and timely delivery of purchased materials,equipment,and services; ¢Identification,inventory,and storage of materials,parts,and compo- nents pending incorporation into the project; *Control of measuring and test equipment; *Segregation and disposition of nonconforming materials,equipment,or components; *Maintenance of records specified by contract and required by the con- structor's QA/QC program to furnish evidence of activities affecting quality. SUMMARY The owner is primarily responsible for specifying and funding QA/QC activ- ities.The owner works closely with the design professional during design to develop a QA/QC process that focuses on project objectives. The design professional is responsible for formulating,implementing,and administering the design QA/QC plan-which is separate from the con- structor's program.The constructor develops and implements the construc- tion QA/QC plan,which the owner and RPR review and approve.In most cases,the design professional also reviews technical elements of contract doc- umentation submitted by the constructor. QA/QC programs involve many details,measures,and submittals-all of which serve the goal of improving project quality.To make QA/QC meas- ures work,participants should communicate regularly.QA/QC processes involve mutual understanding among participants of their respective concerns and accomplishments,as well as a commitment to resolve problems equitably and quickly.O 191 Chapter 20:Quality Assurance and Quality Control Typical Responsibilities Responsibility 0 Owner Professional Design Constructor Design- Builder Set overall approach and attitude to quality Develop and implement design phase QA/QC program Conduct design audits or reviews Incorporate QA/QC measures in construction contract bid documents Evaluate construction bids Develop and implement construction phase QA/OC program Set measurable goals or standards for construction quality Provide documentation of progress toward construction QA/QC goals Communicate regularly with team members regarding quality concerns ©e0©©@©©©©GCe@©e®@@0O8®©®©eoe@@©6@*May engage qualified consultant or other design staff not assigned to project for design reviews or audits. @ =Primary Responsibility @ =Assist or Advise ©=Review 192 CHAPTER 2 T COMPUTERS AND PROJECT QUALITY omputer technology offers a wide range of benefits to the project team. Computers can improve staff productivity by automating individual tasks, as well as improving integration and coordination for the entire team. Computers can help the team improve the speed and accuracy of communi- cation,especially when members are spread over several offices or large geo- graphic areas.Computers also offer new opportunities for improving project quality control. Since the First Edition of this Guide was published in 1990,significant advances in computer technology and widespread access to the Internet have transformed the workplace.This chapter describes some of the benefits that today's computer systems offer owners,design professionals,and construc- tors.The rapid development of computer technology requires that team mem- bers seek out the latest information about systems and software.Therefore, this chapter offers general suggestions about the use of computers to enhance project quality. 21.1 COMMON COMPUTER USES Computers assist with office tasks that are common to the owner,design pro- fessional,and constructor.Commercially available "office suite”software is now used by virtually every organization or business in the construction industry. Following are brief descriptions of the types of software packages that are typically used in the offices of project team members.The types of programs listed below enable employees to produce documents and information more quickly.However,without an understanding of the tasks being automated or the software programs,users can just as quickly create misunderstandings or repeated errors.For example,pre-formatted templates help create documents that look professional-even if they are wrong.Despite advanced "spell check”features,no word processing program has yet been developed that finds factual errors.Therefore,software training courses and self-tutorials are valuable in helping employees get the most out of computer applications. Following are types of software packages and typical uses by project team members. Word processors:Manage text and automate the composing,editing, and formatting of documents.Users can easily incorporate material from older documents into new ones and use "mail merge”features to address an identical document to many recipients. 193 In this chapter 21.1 Common Computer Uses 21.2 Computers and the Owner 21.3 Computers and the Design Professional 21.3.1 CAD Software 21.3.2 Specification-Writing Software 21.3.3 Design Software 21.3.4 Electronic Information Exchange 21.3.5 Coordination and Communication 21.4 Computers and the Constructor 21.4.1 Quantity Calculations 21.4.2 Project Management 21.4.3 Document Contro! 21.4.4 Submittal Tracking 21.4.5 Information Management 21.5 Internet Resources 21.5.1 File Transfer Protocol (FTP) 21.5.2 Project-Enabled Web Sites Spreadsheets:Plan and perform repetitive calculations,summarize data graphically,and organize information in tabu- lar formats. E-mail:Exchange messages and transfer most types of files over computer networks and the Internet. Databases:Assist in organizing,storing,and retrieving large amounts of information,such as personnel records, mailing lists,clent project histories,and correspondence. Project management Provide planning tools,schedules,and budget and collaboration:templates to automate many project management tasks. Computer-Aided Automates many tasks in the preparation of Drafting (CAD):project drawings,shop drawings,and record drawings. Accounting:Automates project accounting,assist swith financial planning,and tax preparation. Presentation:Assists in preparing slide shows,illustrations,over- head view foils,handouts,and computer images to accompany presentations. Desktop publishing:Specialized tools for assembling text and graphics for a variety of publications,from newsletters to books.Desktop publishing software can also be used to prepare files for professional printing. E-mail deserves a special mention because of its widespread use.In many cases,people now prefer E-mail to phone calls.E-mail offers convenience in business communication,but it is not as confidential as the phone.E-mail messages can be saved for months,even years;therefore,E-mail is a form of written correspondence and should be treated as such.A good rule of thumb regarding E-mail content is:if you wouldn't want to see what you wrote,with your name attached,on the front page of the local paper,don't put it in an E-mail.Think twice,click once. The growth and ease with which E-mail and electronic files can be exchanged also raises concerns about computer viruses-programs that deliberately dam- age data or a computer's operation.Software for detecting and removing viruses is available commercially and should be mandatory on project net- works and shared data environments.Virus detecting software should be updated monthly,especially on systems handling data crucial to the success of the project.Due to the prolific exchange of data electronically,it is extremely important to detect and eliminate viruses as soon as they enter a 194 system.Quick action substantially reduces the effort needed to eliminate the virus and prevents the loss of important data. Finally,the frequent backup and safe storage of electronic files is essential for all computer users and systems.Daily backups are recommended to ensure that equipment failure,theft,fire,viruses,or other events do not result in the loss of the most valuable part of a computer system-the data. 21.2 COMPUTERS AND THE OWNER Computer technology can provide project owners with project-specific tools to aid in planning,construction management,and operation.Many computer systems now offer intuitive graphic user interface (GUI)technology that can greatly enhance the owner's ability to understand complex or voluminous project information quickly. One common interface involves a three-dimensional electronic project model that is linked to alphanumeric databases of project information.This type of interface provides owners with easy,"point-and-click”access to information. Typical graphic user interface computer applications for the owner include: Facility Operation:Planning,scheduling,and administering maintenance and repair operations;man- aging inventories of maintenance supplies and spare parts. Financial Management:Tracking and managing project assets; maintaining inventory information on installed assets;assigning assets to enti- ties within the project;and calculating asset depreciation. Facility Space Management:Tracking the assignment of project space to departments and managing charge- backs for its use. Communications Management:Managing communication system infor- mation,such as_telecommunications cables,and Internet connections. Human Resources:Locating staff,managing electronic com- munications,organizing mail delivery, and linking to a larger human resources database. Three-dimensional CAD models can assist the owner in preparing to expand, refit,or remodel an existing facility.Such computer models require that the owner coordinate with the designer and constructor to assure hardware and software compatibility.Computer modeling to enhance owner access to 195 The Project Managers CAD Survival Guide,Stephen Benz,ASCE Press,1997. information is a significant benefit on large and complex projects.However, such modeling requires additional effort over and above that needed to pre- pare construction drawings and information,therefore it may not be cost effec- tive for small projects.To realize its full value,the model must accurately reflect the project as work actually progresses,not as it was proposed. 21.3 COMPUTERS AND THE DESIGN PROFESSIONAL An increasing number of specialized software applications,and the powerful computer systems to run them,are available to the design professional for various design tasks.The following sections discuss general considerations and computer capabilities in drafting,designing,exchanging information elec- tronically,and enhancing project coordination and communication. 21.3.1 CAD Software CAD is of special interest to designers as this software automates many tasks related to the preparation of project drawings,including: ¢Drawing plans and making quick revisions; ¢Extracting frequently used graphics from electronic archives and insert- ing them in new drawings; *Copying repetitive information,such as identifying markings or base- line conditions,on multiple drawings; «Sharing project drawings among disciplines and departments. CAD systems allow users to create detailed three-dimensional project mod- els and conveniently generate different perspectives for design documents and other uses.Some enhanced versions allow the user to perform a virtual walk- through of the designed project. Some CAD systems allow users to link graphic models with related non- graphic information,such as material descriptions,product names and iden- tifying numbers,prices,and information on ordering,delivery,and installation.Sophisticated CAD systems also allow the user to query the model and develop complex qualitative and quantitative reports. Though these powerful CAD features speed up many aspects of the drafting process,their use requires care.Automated CAD tools can allow drafters and technicians to produce complex drawings with little supervisory oversight. These drawings may look right,but the information or calculations support- ing them may be wrong.In addition,while it may be possible to create a design concept in CAD,the designer must verify the appropriateness of the design to the project at hand and its constructability.It is tempting to prom- ise very short turnaround times,relying on "the computer”to somehow ensure that the drawings will be correct.Designers still need time to check their work carefully before,during,and after the use of a CAD system. Common CAD errors include using library materials and information from other projects without verifying their relevance to the project at hand,shar- 196 ing drawings with other team members without verifying their accuracy,and failing to document the exchange of electronic files. 21.3.2 Specification-Writing Software Designers often use standard specification software to create project specifi- cations.These software packages are typically standard word processors linked to a library of commonly accepted specifications to provide current product,material,and construction methods.Standard specification libraries must be kept current.Most government agencies and vendors provide sub- scription services at a nominal cost to ensure that subscribers keep their spec- ifications current. 21.3.3 Design Software Design software performs tasks related to calculation-based design work,such as structural loadings or roadway geometry. Many design programs interact directly with the user's CAD graphic files. Some design programs evaluate the work as it is drawn,and some include features that feed calculations directly into CAD software and produce sig- nificant portions of the project drawings automatically.The general benefits of design software include: *Consistency in design tasks; *Ease in checking work; *Greater convenience in sharing calculations with clients and other team members. As with CAD software,design programs can provide misleading or incorrect information if used by inexperienced staff.Project quality depends on the review of critical work products by experienced designers even when using sophisticated CAD software.Many design offices continue the time-honored practice of formalizing the review process with routing slips or stamps with the familiar boxes:"Designed By,”"Checked By,”and "Approved By.” 21.3.4 Electronic Information Exchange Computer networks allow designers to submit and receive a variety of infor- mation electronically.Designers may send and receive information over computers connected to a company wide network or linked to the Internet. These links allow designers to receive information not only from colleagues within their own firms,but from owners,subcontractors,constructors,and government agencies.This information may include surveys,reports on exist- ing site conditions,plans for adjacent properties,preliminary design studies, documents from previous project phases,government codes and regulations, and more.In many cases,exchanging drawings electronically is more con- venient and less expensive than producing and shipping actual blueprints. CAD and design software may allow the designer to import or link informa- tion directly to a project model or file so that it can be easily recalled.Such features can save time and effort,compared to the manual recording and filing 197 >Chapter 5,"Coordination and Communication” of information from paper documents,but can also raise quality concerns. These concerns include: ¢Reliability or trustworthiness of the party that prepared the files; ¢Availability of the person or agency who prepared the information to answer questions during the project; e Accuracy,completeness,and relevance of the material.Extraneous material may hamper progress if the designer must locate or verify rel- evant materials. 21.3.5 Coordination and Communication Automated tools help the design professional better communicate with other team members and coordinate project work with them. Project coordination requires communication among many people.Beyond E-mail and electronic file transfers,computers can further assist in project coordination by allowing team members to: ¢Exchange or work simultaneously on large text documents,spreadsheets and other calculations,drawings,red-line markups,catalog cuts,3-D electronic models,and other files; ¢Conduct on-line meetings with video images of participants in remote geographic locations; ¢Share and evaluate ideas with other people on the computer network; *Operate a program on a computer in another location. However,computer-based communication poses its own challenges.The equipment and rental of any extra network lines can be expensive,and oper- ating the systems requires staff and ongoing support.Such systems can make communication so convenient,even fun,that people communicate too much. Instantaneous communication can allow individual team members to make decisions and act without pausing to reflect or consult others. 21.4 COMPUTERS AND THE CONSTRUCTOR In addition to assisting with day-to-day office operations,computers offer important benefits in automating many of the tasks performed by the con- structor.These include quantity calculations,project management,document control,submittal tracking,and information management. 21.4.1 Quantity Calculations Electronic drawing files are a great benefit to the constructor in estimating the quantities of bulk materials,such as concrete and steel,as well as the num- ber of individual components,such as electrical outlets,that will be neces- sary to complete the project as designed.Computer files that include three-dimensional project models linked to non-graphic databases are espe- cially helpful for estimating purposes.However,these models may not allow for waste,breakage,settling of materials,or other factors that affect the actual quantity of material needed. 198 21.4.2 Project Management Project management software assists users in breaking down a large project into a sequence of individual tasks.Such software often includes features that allow the user to: ¢Assign people,equipment,and materials to each task; «Assign a duration to each task; *Develop a project flow diagram that shows the tasks and the sequence in which they are to be performed; ¢Identify critical path items; *Investigate alternate project task scenarios that allow the critical path to be shortened. Project management software can be valuable to the constructor,as long as the information entered is accurate and reliable.This necessitates that the rela- tionships and timeframes assumed in the model are consistent with actual conditions and that information is current.Regular tracking and comparison of actual progress with that forecast by the software allows further adjust- ments to the model and helps increase accuracy. 21.4.3 Document Control Computer systems are an enormous benefit to the constructor in organizing, archiving,and controlling the flow of project documents.In particular,the use of central file servers (computers with large storage capacities that are accessible via a network)can electronically consolidate documents that may have previously been scattered throughout the company. Documents that may typically be included on file server systems include: ¢The owner's original Request For Proposal and the constructor's sub- mitted proposal; *Contracts and amendments; *Correspondence; ¢Meeting minutes and notes; ¢Reports; ¢Project drawings and specifications; ¢Catalog information; ¢Shop drawings and submittals; *Job site reports; ¢Punch lists. Computer operating systems provide a variety of options for organizing these documents and providing convenient access to them.The constructor's team benefits from investing time in determining what type of file organization will be most effective for the project at hand.Like a library,an organized and maintained project document repository helps everyone perform more efficiently. 199 21.4.4 Submittal Tracking Computer systems can help the constructor manage project submittals received from subcontractors,suppliers,fabricators,and other project partic- ipants.Once received,submittals are typically distributed and reviewed by multiple parties,marked with corrections and changes,returned to the origi- nator for updating,re-submittal,review,and final approval. Many word processing,database management,and project management pro- grams provide the constructor with automated capabilities to determine the status of any submittal.These programs may record the arrival of submittals and track them through the subsequent steps of the review and approval process.Submittal tracking systems require active staff participation to be reliable and useful. 21.4.5 Information Management Computer information and management communications capabilities are an asset to the constructor.One example is real-time video communication, which not only brings together project participants-of which there are usu- ally a greater number during the construction phase of a project-but can also allow the constructor to view construction sites remotely.Akin to older,more expensive closed-circuit television systems,affordable "web-cam”technol- ogy can be useful at work sites involving unusual automobile traffic or secu- rity concerns. 21.5 INTERNET RESOURCES In addition to E-mail,computer technology used in conjunction with the Internet offers opportunities to enhance productivity for project participants. Computer technology can streamline the exchange of information among team members,provide quick and convenient access to reference materials or other professionals in the industry,provide information to the public,and improve overall project coordination.Two examples are hightlighted below. 21.5.1 File Transfer Protocol (FTP) FTP programs let team members post drawings and other large files on secure Internet sites from which other team members can download them.Use of an FTP site requires file transfer software that is inexpensive or even free.FTP sites are valuable as on-line electronic libraries for large project files.FTP sites allow team members to reduce costs for long distance telephone serv- ices,printing expenses,and shipping.However,the management of FTP sites requires care,as files must be current,approved for use,and properly identified. 21.5.2 Project-Enabled Web Sites Secure web sites help provide project team members with rapid,secure,and easy access to critical project information through web browsers.Such web sites,which are generally easier to use than FTP sites,require a level of web page expertise on the part of the person maintaining the site.Project-enabled web sites can include a variety of project information,including correspon- 200 dence,reports,drawings,specifications,product information,budgets,sched- ules,tracking data,and more.Authorized team members can view the post- ings on-line,or download them.A project-enabled web site can act as a "home office”for team members spread out over many geographic locations. SUMMARY Computer systems and software are now an indispensable support element for designing and constructing projects.Computers support the various processes from conceptual planning to operation of the completed project. Computers can increase productivity,automate routine tasks,improve the inte- gration of related tasks,and enhance communication among team members. However,computers are not magic.They contribute to project quality only when they are selected and used appropriately.The impact and contribution of computer technology to constructed projects will continue to grow,and proj- ect owners,design professionals,and constructors will benefit by investing the time and funds to remain in the forefront of this rapidly changing field.O 201 peer review is an independent assessment of a business organization, project,or technical process.This chapter discusses two types of peer reviews:organizational peer reviews and project peer reviews.In some pro- fessions,peer reviews carry a negative connotation,but not in design and con- struction,where a peer review is an affirmative tool available to the project team for enhancing quality. Organizational peer reviews address the typical workings of a firm or agency as a whole,including policies,procedures,and practices.Organizations include project owners,design professionals,and constructors;they can be privately owned or a governmental entity. Project peer reviews,in contrast,focus on a single project,and usually focus primarily on either design or management.Project design peer reviews (some- times called project performance peer reviews to broaden their scope beyond design)examine in detail the technical results or recommendations for all or part of the project at its current stage of development.Although not covered here,project peer reviews (of design or management)also explore many of the same policies,procedures,and practices covered in organizational peer reviews,but the scope of inquiry is narrowed to a single project. Peer reviewers are engineering or construction professionals who have expe- rience with similar organizations or projects and who are typically managers or senior technical persons from another organization.Reviewers thus have a fresh perspective that allows them to act independently. The scope of the peer review is specified by the organizational manager or project team member who commissions the review.The review might cover issues of technical design,project management,or the overall management of team member organizations.The peer review processes described in this chapter are typical for traditional design-bid-build project delivery,but in most cases,they are applicable to design-build and other forms of project delivery. 22.1 GENERAL FEATURES Organizational and project peer reviews have the following general features: ¢The purpose,scope,format,and duration of the review are well defined to help distinguish it from other,less systematic reviews; *The technical or managerial expertise of the reviewers-industry peers of the owner,design professional,or constructor-is usually similar to or greater than that of the professionals being reviewed; 203 CHAPTER 2 2 PEER REVIEW In this chapter 22.1 General Features 22.2 Types and Benefits of Peer Reviews 22.2.1 Organizational Peer Review 22.2.2 Project Peer Review (for Design) 22.3 Procedural Elements of Peer Review 22.3.1 Request for Peer Review 22.3.2 Establishing Scope of Peer Review 22.3.2(a)Organizational Peer Review 22.3.2(b)Project Design Peer Review 22.3.3 Selecting Reviewers 22.3.4 Preliminary Document Review 22.3.5 On-Site Document Review and Personnel Interviews 22.3.6 Reporting 22.3.7 Follow-Up Actions 22.4 Responsibility 22.5 Peer Review Programs and Resources 22.5.1 Organizational Peer Reviews 22.5.2 Project Design Peer Previews Types of Peer Reviews 1.Organizational 2.Project ¢Design (or performance) e Management Wonder,rather than doubt,is the root of knowledge. Abraham Heschel ¢The organization or project reviewed by an independent peer or team of peers benefits from the broader range of experience brought to bear; ¢The reviewers work in cooperation with project staff but independent of their oversight; ¢The parties involved give the review special attention in acknowledg- ment of its potential benefits; ¢Peer review recommendations are disseminated in a timely fashion to appropriate individuals,especially those whose activities are the sub- ject of the review; *The peer reviewers serve in an advisory capacity;they do not have the authority to implement their recommendations. Peer reviews differ from other reviews in several respects: ¢Peer reviews do not signal that an organization or member of a project team is incompetent or suspect;rather,recommendation of or partici- pation in a peer review demonstrates a commitment to improve quality. ¢Peer reviews are conducted only by people who have not been involved with the organization or project. ¢Peer reviews are not required by a regulatory agency. *Peer reviews are more than a constructability review,although review- ers often inquire about assumptions affecting construction. To succeed,a peer review requires adequate resources,including budget,time, and effort.Advance planning can keep peer reviews from being disruptive. The benefits of a peer review usually outweigh the costs. 22.2 TYPES AND BENEFITS OF PEER REVIEW The following sections discuss the two types of reviews that are most fre- quently encountered in the construction industry:organizational reviews and project reviews. Peer reviews deliver many benefits that enhance quality for individual proj- ects,as well as for the organizations involved.Benefits occur even before the review begins:a peer review signals that managers care enough about qual- ity to ask their peers to point out possible improvements in their work,or participants acknowledge that a project or organization is important enough to warrant outside opinions.Therefore,the preparation for a peer review is also a benefit,as it requires participants to bring a new level of focus on their work and procedures. 22.2.1 Organizational Peer Review Organizational peer reviews independently assess the operations of a design or construction organization (private or public)in light of how faithfully the organization's stated overall policies and practices are actually practiced.The organization benefits by this identification of opportunities for general improvement. 204 22.2.2 Project Peer Review (for Design) Project peer reviews-both design reviews and the less frequent project man- agement reviews-involve a separate,structured,focused,and thorough fact- finding process conducted by one or more senior professionals who are independent from the project team.Before either type of review begins,the reviewer(s)work with the owner,design professional,or constructor to develop a detailed scope of the review.This scope includes the functions to be reviewed,the process to be followed,the schedule,and the form of reporting. A project management peer review is essentially an organizational peer review applied to a single project,rather than to the entire organization.Elsewhere, such a peer review could be carried out by adapting procedures of organiza- tional peer reviews.Therefore,without diminishing the value of project man- agement peer reviews,the discussion in this chapter of project peer reviews refers to project design peer reviews only. A distinguishing feature of a project design peer review is that its scope goes beyond routine standard procedures and daily quality control checks.For instance,a critical structural connection might be peer reviewed using an inde- pendent method of analysis or for the effects of cumulative dimensional tol- erances,the sequence of fabrication or erection,or loads other than those assumed by the designer. One or more of the following circumstances might suggest that a project peer review would prove useful: ¢The project is larger or more complex than is usual for the team; ¢Technological innovations are involved; ¢Previous similar projects have experienced difficulties; *Project objectives have changed during design,or disputes have arisen; *The project team includes several offices or many different organizations; ¢The project involves a rapid or fast-track schedule; ¢Budgets for developing or implementing recommendations are limited; ¢The number or qualifications of staff personnel are a concern,includ- ing apparent over-commitment or the recent departure of key persons; *The project involves large potential liabilities to the owner,design pro- fessional or constructor,or poses unusual risks to the public; ¢The status of work performed to date is in question; ¢The project involves special environmental concerns. Project design peer reviews can examine an entire project but usually are lim- ited in scope.They often occur at the completion of design,but there are advantages to holding a review at the earlier key milestones.Project peer reviews can also be performed during construction,or even upon project com- pletion (as a benefit to subsequent projects).Therefore,the scope of a project 205 The discussion of project peer reviews in this chapter refers to project design peer reviews only. peer review is defined when the review is authorized and necessarily reflects the current state of project completion.Typical scopes include inquiries into: ¢Design assumptions or criteria; *Applicable codes and regulations; ¢Accuracy of calculations (in designated areas or by spot check); *Clarity and completeness of reports or design documents; ¢Appropriateness of selected actions compared to alternatives identified; «Application of good judgment; ¢Constructability of the design; «Construction means,methods,and techniques proposed or employed; ¢Prospects of meeting project objectives. Despite certain similarities,the project design peer review is not a value engi- neering study.Value engineering assumes an adequate design and attempts to match the effectiveness of the design while reducing cost,whereas a proj- ect peer review focuses on the quality of the design in meeting the project objectives (while still being cognizant of cost). 22.3 PROCEDURAL ELEMENTS OF PEER REVIEW Peer reviews of either organizations or projects follow six general steps:com- missioning the review,developing the scope,selecting the reviewer(s),exam- ining documents,conducting on-site interviews,and reporting.Subsequent follow-up actions may be advisable for the clarification,acceptance,and LE)Engineers Joint Contract Documents Committee Doc. E-581,Standard Form of Agreement Between Owner's Designer and Project Peer implementation of recommendations.The following sections discuss these Reviewers for Professional procedures in detail,highlighting similarities and differences in organizational Services for Independent and vroject design peer reviews. Project Peer Review 22.3.1 Request for Peer Review A peer review begins when one of the parties involved formally requests that a review be conducted.In the case of organizational reviews,this request often comes from management as part of an organization-wide quality enhance- ment process.Reviews are especially effective for large organizations seek- ing to improve the performance of individual operating units.Organizational peer reviews might also be mandated by an owner or required by a regula- tory agency as part of an approval process. Project design peer reviews can be requested by any member of the project team (owner,design professional,or constructor),or by one or more regula- tory agencies having jurisdiction over the project.In most circumstances, unless the review is requested by the designer or constructor,the owner author- izes the review and pays the associated costs. 22.3.2 Establishing Scope of Peer Review The scope for a peer review should be focused and well defined,distinguishing it from other,more general reviews. 206 22.3.2(a)Organizational Peer Review An organizational peer review can focus on procedures for completing proj- ects,or it might address all aspects of management.In its complete form,the organizational peer review begins with the contract or authorization and pro- ceeds through the following typical project steps: ¢Conducting programming or preliminary studies; ¢Planning for the design phase,including resources and time required; ¢Maintaining records and other files; *Developing basic or specific personal skills; ¢Acquiring technical equipment and training in its use; *Adopting and distributing standards,and training staff in their use; ¢Assessing quality management procedures to be used. The organizational peer review may verify the adequacy of office facilities, libraries,support for field services,and the management of "low-tech”or non- technical equipment.The review team may critique personnel policies and professional development programs,as well as procedures or opportunities for sharing professional experiences.As a rule,a review includes all facets of an organization's practice,from line activities,to distinctive staff functions, to looking at marketing activities and relationships with external organizations. The scope of organizational peer reviews is often standardized by recognized programs. 22.3.2(b)Project Design Peer Review The scopes of project design peer reviews vary widely.While reviewers might be asked to look only at a project's final design documents,the process gen- erally delivers more benefit when conducted at earlier points in a project's design phase,as well as,occasionally,during construction.All parties should be apprised in a timely manner of the proposed use of the review. Project design peer reviews can be commissioned as early as the planning for design phase of a project.A review at this point provides the owner with an independent assessment of the proposed design,presumed construction processes,and design schedule.Irrespective of project phase,however,a proj- ect design peer review scope calls for a report to be delivered immediately upon completion of the review.The scope might state that the delivery of the report signals the end of the peer review for the project or for that phase;or the scope might involve the review team in evaluating follow-up activities. Because of the many variables involved in setting the scope of a project design peer review,all participants benefit from investing ample time in the scoping process. 22.3.3 Selecting Reviewers Accomplished peer reviewers are independent thinkers,good communica- tors,and contributors to excellence in their profession,regardless of the type of review. 207 >22.5,"Peer Review Programs and Resources” The independence of the review team starts with the selection of members from outside the organization or office being reviewed.Peer reviewers rarely come from within the same organization,and then only if they are sufficiently removed in authority and geographic location from those whose work is being reviewed. Peer reviewers should be qualified,well regarded senior professionals,expe- rienced with similar organizations or projects,familiar with governing regu- lations,and widely accepted as being ethical,objective,and thorough.The team could include reviewers from varied disciplines,including environmental scientists,economists,estimators,and experts from other construction fields. Several professional associations offer formal organizational peer review pro- grams with training and certification. The size of the review team depends upon the scope and complexity of the peer review.A team normally consists of two or more reviewers,although single-person reviews are possible for smaller organizations or projects. 22.3.4 Preliminary Document Review All peer reviews begin with an examination of documents provided to the review team before they meet as a team.These documents serve to introduce the organization or project.Preliminary peer review information might include confidential questionnaires completed by appropriate staff. 22.3.5 On-Site Document Review and Personnel Interviews When the peer review team arrives at the organization or project office, reviewers go over additional documents and conduct confidential interviews with key personnel and a cross section of other employees or team members. In an organizational peer review,personal interviews provide reviewers with first-hand information about the organization and its goals.The managers and staff interviewed have the opportunity to demonstrate their professional understanding and competence in key areas,including administration,qual- ity assurance and control,user satisfaction,project controls,field activities, and overall direction.The confidential nature of these interviews aids in elic- iting candid observations. Project design peer reviewers generally develop preliminary conclusions about the project's status or technical quality based on on-site evaluation of relevant documents and then augment the results of this document review with personal interviews of managers and staff.This consideration of both written and oral information helps the review team determine the extent to which project design assumptions and goals are understood and are being implemented. The review team might,if the scope specifies,recommend solutions to cir- cumstances encountered,both administrative (in organizational peer reviews) or technical (in project peer reviews).This stage of the review provides an opportunity to recognize innovative features,as well as potential problems. 208 22.3.6 Reporting Peer review reports are of great interest to those being reviewed.In addition to the impact on the industry reputation or public perception of an organiza- tion or project,the influence of peer review reports can affect the professional status of the people involved.Therefore,the structure,tone,and delivery of reports for both organizational and project design peer reviews are crucial. The report should be distributed according to the parameters established in the scope of the review. Organizational peer reviews are confidential.These peer review reports are often informa!and delivered orally.Reports should remain within the estab- lished scope,noting areas of compliance and patterns or instances of unmet responsibilities,contract problems,or authorization issues.The report might also provide insight or suggestions for improvement. If an organization is large or has multiple offices,the organizational peer review report might be delivered to either the top managers of the office that commissioned the review,or only to the office reviewed.Following the deliv- ery of the report,the review team usually destroys the notes and documents created during the review to ensure the confidentiality of the process. In the case of a project design peer review,many issues can be resolved infor- mally by direct communication between the designer and the reviewers. Unresolved or major issues concerning the owner's requirements,as set forth in the scope of the inquiry,are included in the written report. Unlike typical organizational peer review reports,reports of project design peer reviews are generally detailed,not confidential,and submitted in writ- ing to communicate accurately the review team's technical conclusions. Typical reports include the following sections: ¢Scope of the review,including limitations; ¢Current schedule and the status of project; *Phase being reviewed; *Recommended corrective actions; *Issues for further evaluation and consideration. For both organizational and project design peer reviews,balance is an impor- tant aspect of the report;favorable comments,as well as critical ones,are helpful in assessing performance.Positive statements can help a reader under- stand the limits of the inquiry.Peer reviewers should avoid imposing their own personal preferences without appreciating other acceptable practices. Further,peer review reports do not in themselves call for required actions,but are intended to guide decisions by pointing out potential improvements.In many cases,informality is an asset in achieving this goal. 22.3.7 Follow-Up Actions Without clearly defined follow-up or action items after the delivery of the report,the full benefit of any peer review to the organization or project can 209 wy Organizational peer review resources: Wwww.asc.org Www.acec.org www.agc.org be lost.In some cases,the commissioning authority can simply order that the recommendations be implemented.In other cases,those being reviewed have the responsibility to address their own actions and documents. Offices that voluntarily seek either type of peer review tend to take the find- ings seriously and work to implement them in a constructive spirit. Establishing measurable results and a realistic schedule are key aspects of successful implementation of the findings. Upon the conclusion of the review,the commissioning authority acknowl- edges completion and releases the team.At that point,the parties complete any remaining administrative actions,including compensation,certificates of completion,and any other appropriate documentation. 22.4 RESPONSIBILITY While the goal of the peer review process is to enhance project or organiza- tional quality by soliciting the input and advice of external parties,the respon- sibilities of the organization or the professionals reviewed remains the same. Organizational peer reviews lead to the organizations themselves adopting or rejecting findings.Project peer reviewers are not authorized to make changes, or direct others to make changes,in project documents;they have no author- ity Over organization or project personnel,and the original professionals retain their legal responsibilities. 22.5 PEER REVIEW PROGRAMS AND RESOURCES The following two sections offer additional resources for organizational and project peer reviews. 22.5.1 Organizational Peer Reviews Four professional associations offer standardized organizational peer review programs for design professionals,generally costing only reimbursement of direct expenses plus a modest honorarium for the reviewers: ¢ASFE,an organization of professional firms practicing in the geo- sciences,which developed the first organizational peer review process in 1978; ¢The American Consulting Engineers Council (ACEC),which expanded the ASFE program and adapted it for all private engineering and archi- tectural design firms in the United States,Canada,and Mexico.The ACEC-sponsored program has been endorsed by ASCE,the National Society of Professional Engineers (NSPE),and American Institute of Architects (AIA)for all engineering and architectural firms.Peer reviews have been conducted by ACEC in English,French,and Spanish; ¢The American Society of Civil Engineers (ASCE),which administers an organizational peer review program for governmental agencies that is similar to the ACEC program; ¢The Associated General Contractors of America (AGC),which has a voluntary program that can be implemented by groups of interested firms. 210 22.5.2 Project Design Peer Reviews Several large project owners,designers,and constructors have also established in-house project design peer review programs.Although ASCE and ACEC jointly publish voluntary guidelines for project design peer reviews,they do not administer the reviews.ASCE has developed a Standard for Independent Project Peer Review (No.22-97)that can be included by reference in statutes or ordinances or adopted by any commissioning authority.This standard helps make the framework for project peer reviews more cost-effective and suc- cessful.An EJCDC contract form has been prepared to facilitate the use of this Standard. SUMMARY A peer review is a high-level action taken to improve quality in constructed projects.An organizational peer review examines the policies and practices of an organization across many of its projects and activities.A project peer review focuses intensely on a single project,perhaps even on a single phase at a time or a single component of the entire project. Peer reviews are requested as an added measure to improve quality.Many leaders familiar with peer reviews have encouraged their use by large or small organizations and on large or small projects.A fresh,unbiased,and diplo- matic review by one or more professionals can be a highly cost-effective meas- ure and can often be a means to reduce the overall time required to complete a constructed project.O 211 (1)ECDC Doc.E-581 Standard Forms of Agreement between Owner,Designer, and Peer Reviewers for Professional Services for Independent Project Peer Review Chapter 22:Peer ReviewTypicalResponsibilities” Responsibility Design Design- g Owner Professional Constructortt Builder Commission the review ee”@t ®t Establish scope e@ 'O)t @ (©) Provide sufficient budget and schedule e @t @® resources Select reviewers e ©t @ Participate in interviews,document @ t e reviews,and other activities Adopt report e@ e@ t ) Implement recommendations @®e r "Responsibilities apply to project design peer reviews.For organizational peer reviews,the organization itself holds primary responsibility for the general tasks above. **A regulatory agency,acting on its own or enforcing a regulation,could require a project peer review as a con- dition of permitting. tThe design professional or (design-builder)can initiate a project peer review of his or her own work at any stage of a project,in which case the designer is responsible for carrying out all responsibilities alone. tT The constructor is generally not involved unless he or she has been selected at the time a project peer review is initiated and is specifically invited to participate,or unless design-build delivery system is being used. @ =Primary Responsibility @ =Assist or Advise ©=Review 212 CHAPTER 2 3 RISK,LIABILITY,AND AVOIDING CONFLICT Coonsiction projects involve risks.All participants-the owner,designprofessional,and constructor-face varying degrees and types of risks, which are present during every phase of a project. Risks normally determine many of the financial,contractual,and practical relationships among the participants.Some risks may involve more than one of these relationships;some may involve all of them.Because significant risks are present on almost every project,each participant must have a plan to manage these risks before making any commitment to the project and other parties. This chapter identifies some of the risks that are common to most construc- tion projects and outlines practical and contractual techniques to manage those risks.Topics include the use of risk management tools such as insurance,war- ranties,and bonds;an overview of contractual and legal liabilities that can result when a risk materializes into a loss;and a discussion of conflict avoid- ance,options for conflict resolution,and litigation. Because many methods of managing risk (e.g.,clauses involving indemnity, limitation of liability,contribution,and other technical risk transfer tech- niques)involve specialized legal and/or insurance knowledge,it is critical that an appropriate consultant be engaged as soon as possible to offer the needed expertise. 23.1 PROJECT RISKS Risks,by definition,are uncertain.It is impossible,therefore,to predict and account for every adverse occurrence on any project.However,historic expe- rience has helped identify the nature of most risks on most projects.These types of risks are summarized below. Safety:Construction work has a high potential for job- site injuries to workers and others,including the general public. Difficulty:Construction work is performed under (some- what)uncontrolled field conditions,often using designs that incorporate unique or new ideas by a work force with varying degrees of training, skill,and experience. 213 In this chapter 23.1 Project Risks 23.2 Managing Risk 23.2.1 Evaluating the Project 23.2.2 Evaluating Other Team Members 23.2.3 Project Delivery Systems 23.2.4 Contractual Provisions 23.2.4(a}Owner-Design Professional Agreement 23.2.4(b)Owner- Constructor Agreement 23.2.4(c)Design-Build Risk Contractual Considerations 23.2.5 Project Performance 23.3 Risk Management Tools 23.3.1 Insurance 23.3.1(a)Insurance Needs of the Owner 23.3.1(b)Insurance Needs of the Design Professional 23.3.1(c)Insurance Needs of the Constructor 23.3.1(d)Insurance Needs of the Design- Builder 23.3.2 Bonds 23.3.3 Warranties 23.4 Liability 23.5 Avoiding Conflict 23.6 Conflict Resolution 23.7 Litigation All participants face varying degrees and types of risks. Unforeseen Conditions:During construction,previously unforeseen or changed conditions may be encountered,requir- ing modifications to design and construction activ- ities that may increase cost or delay completion. Diversity of Interests:The owner,design professional,and constructor may have different interests with respect to the allocation of project resources and financial risk. Control:Project participants lack the ability to control a variety of factors,such as weather,fire,earth- quake,labor needs,civil disorder,market condi- tions for materials,and the actions of third parties (including regulatory agencies). Professional:Participants may risk damage to their reputation or industry standing. Legal:Participants and third parties risk exposure to lit- igation and legal liability. Financial:A participant's lack of sufficient funding to meet obligations may increase risk. Community Opposition:The failure to meet community requirements, communicate project objectives,and/or be a good neighbor may increase risk. 23.2 MANAGING RISK Risk management requires that the project owner,design professional,and constructor carefully identify and examine several aspects of the project at hand.They accomplish this by evaluating the potential risks of the project itself,the roles and qualifications of the other team members,the method of project delivery,contractual provisions for allocating risk,and the means of establishing and providing incentives for performance.While each partici- pant must evaluate his or her particular exposure to risk presented by the proj- ect,it is the owner who is in the best position to properly allocate risk through fair contract provisions.Frequently,the owner seeks the advice of the design professional regarding risk.In fact,one of the most important considerations in using the standardized contracts of the American Institute of Architects and the Engineers Joint Contract Documents Committee is that risk is allocated fairly and to the party in the best position to manage and,therefore,accept it.The following sections address these aspects of risk management. 23.2.1 Evaluating the Project Before an owner,design professional,constructor,or other entity undertakes any particular project,questions relating to feasibility and risk associated with that project must be addressed.Some of these questions include: ¢Will the project meet the owner's needs? ¢Is the project adequately funded? 214 ¢Is the project schedule realistic? ¢What is the potential financial loss to the team members? *What is the potential for personal injury or property damage? ¢What is the potential for uninsurable losses,such as environmental con- ditions that are generally excluded under standard general liability insur- ance policies? ¢Does the project have significant environmental impacts? *Does the project involve novel or unfamiliar delivery techniques? *Is the public profile of the project such that professional reputations are at risk? 23.2.2 Evaluating Other Team Members The quality and reputation of the other members of the team is an important consideration in the management of project risk.Characteristics to consider include: *Reputation and record for honesty and integrity in business relationships; ¢Financial strength and funding capability; *Performance on similar projects; ¢Capability and experience of the personnel assigned to project; *Previous relationships among team members; ¢History of litigation on previous projects; *Limits and quality of bonding and insurance coverage; ¢Safety history and worker's compensation rating. The qualifications of each participant directly affect the degree of risk assumed by the others.For example,if the constructor or the owner have limited finan- cial resources,parties making claims against the project are more likely to pursue the design professional to recover losses.Parties also benefit from eval- uating the types of legal entities that parties may deploy to participate on a project.The formation of a separate limited liability corportation (LLC)or a limited partnership (LLP)for the purpose of working on a particular project is a common strategy for limiting risk.Recovery against these types of enti- ties is usually limited to the resources of the LLC or partnership,which may be significantly less than needed to cover major losses or liabilities. 23.2.3 Project Delivery Systems A number of hybrid and legally complex project delivery systems are now available to owners.In addition to traditional design-bid-build contracting, owners can choose from delivery systems such as design-build,construction management,turnkey,and numerous variations to meet the needs of a par- ticular project.Therefore,it is essential that participants carefully consider the risks associated with their roles under the proposed delivery system.For example,design-build-operate-maintain (DBOM)projects often require that the design professional and constructor contribute equity or financing to the project.While this arrangement may reduce the burden on the owner,it 215 The qualifications of each participant directly affect the degree of risk assumed by others. >3.5,"Design-Build Variations” >Chapter 7,"Agreement for Professional Services” >Chapter 15,"The Construction Contract” requires that the other parties carefully evaluate the allocation of risk,partic- ularly the economic risk of recovering that equity. 23.2.4 Contractual Provisions After the project and participants are evaluated,each party focuses on the con- tractual arrangements that are available to manage risk.The advice of expe- rienced construction attorneys and insurance professionals is essential in drafting and negotiating specific contract terms and conditions.Such advice should be sought early in the contract negotiation process because the dif- ferent manners in which risk is transferred,assumed,avoided or reduced can have significant impacts on the project cost,method of delivery,and other important characteristics. 23.2.4(a)Owner-Design Professional Agreement In the professional agreement between the owner and design professional, provisions relating to risk management include: A well-defined scope of services,including a statement of the services to be provided by the designer and those excluded; *A statement of actions,information,or services to be provided by the owner; *A statement of the standard of care by which the design professional's performance will be judged; ¢The extent to which design responsibility for systems or components may be delegated to the constructor; ¢Disclaimers of liability for certain responsibility of others,such as the constructor's safety program,the design of temporary structures,and means and methods of construction; ¢Indemnification for appropriate risks,including third-party claims; *Waiver of consequential damages; *Limitations of liability; ¢Necessary professional liability insurance coverage; *Dispute resolution provisions. When appropriate,the design professional may incorporate similar provisions in agreements with subconsultants. 23.2.4(b)Owner-Constructor Agreement In the agreement between the owner and constructor,the typical provisions related to risk management include: ¢A well-defined scope of work for the constructor,including plans,spec- ifications and other contract documents; ¢A statement of actions,information,or services to be performed by the owner; *Responsibility for construction means,methods,techniques,procedures, and for site safety programs and temporary structures,if applicable; ¢Responsibility for subsurface conditions and environmental impacts; 216 e The extent to which design responsibility for systems or components may be delegated to the constructor; *Quality control programs; ¢Indemnification clauses providing protection for the design professional and owner; ¢Waiver of consequential damages (between and among the parties, including design professional); ¢Limitation of liability and/or liquidated damages (when appropriate); *Insurance and bonding requirements; *Granting additional insured status to both owner and design professional and waiver of subrogation by all insurers; ¢Warranties and guarantees; ¢Dispute resolution provisions. When appropriate,the constructor may incorporate similar provisions in agreements with subcontractors. 23.2.4(c)Design-Build Risk Contractual Considerations In the U.S.,the popularity of design-build project delivery is increasing.To effectively manage risk,the design-builder considers the risks that face both the design professional and constructor,as outlined in the two previous sec- tions.The members of the design-build team address risk management inter- nally and incorporate provisions to allocate the risks among the various team members in one or more separate contracts.The risks to be considered in these types of agreements include: ¢Design deficiencies; *Design changes; *Differing site conditions; ¢Delays; *Warranties; *Liquidated damages; ¢Waiver of consequential damages; ¢Limitation of liability; ¢Indemnification; *Insurance and bonding. Under some ferms of project delivery,such as turnkey or one of its variations, the design professional or constructor may be required to contribute equity or financing to the project,thereby assuming all or a portion of the owner's financial risk.In such a case,parties benefit from the careful consideration of the risk and contractual issues noted above. 23.2.5 Project Performance After agreeing on contract terms that minimize and properly allocate risk, the team members can continue to manage risk by performing in a manner that is faithful to the letter and spirit of those terms.Attention to detail and 217 completing tasks on time improves overall project quality and reduces the likelihood of conflict.Adherence to the owner's or constructor's job-site safety program,regardless of the terms of contract,is often the most important means of reducing the risk of injuries to workers.Taking affirmative steps to meet schedule milestones is an important strategy for minimizing delay-related conflict. For performance-related activities,regular and honest communication is the cornerstone of the effort to minimize risk,especially during periods of adver- sity and conflict.Communication is necessary for defining problems,resolv- ing misunderstandings,and facilitating solutions in a manner that is productive and nonconfrontational. 23.3 RISK MANAGEMENT TOOLS The owner,design professional,and constructor all have certain tools at their disposal that are specifically designed to manage risk.The most important of these are insurance,bonds,and warranties. 23.3.1 Insurance Because of the dangers inherent with construction and the potentially large number of participants,construction projects can require several types of insurance arrangements.Team members typically carry insurance for gen- eral liability and property damage,motor vehicle operation,and workers' compensation.Certain project-specific and wrap-up owner or contractor con- trolled insurance programs (OCIP and CCIP)may also be required.The con- tract documents specify the type and amount of insurance coverage required for each project and the parties who are to provide and pay for it. 23.3.1(a)Insurance Needs of the Owner An owner uses insurance to protect against the risks posed by physical loss or damage to the work in progress at the construction site.To cover these risks,an owner may purchase or require the constructor to provide builder's risk insurance.Because the interests of the owner,design professional,and constructor may be at risk throughout construction,each party is named on the builder's risk policy.It is typical that either the owner or the constructor is designated to be responsible for obtaining builder's risk insurance for the benefit of all participants.In addition,to make sure that losses are shifted to the insurance company or companies,the builder's risk insurance should include a waiver of subrogation. 23.3.1(b)Insurance Needs of the Design Professional Design professionals typically carry insurance for professional liability (or "errors and omissions”)insurance.These policies are usually written on a claims made form (that is,the policy must be in force at the time of the claim) and usually are renewable annually.The policy limit has an annual aggregate feature and does not apply on an each and every claim basis.In some instances,policy limits may need to be increased according to the provisions of the owner/design professional agreement. 218 Alternatively,because the design professional's practice policy covers claims made during the policy period that may,in turn,relate to services actually completed many years ago on unrelated projects,the aggregate limit of lia- bility may not be adequate to indemnify the injured party on claims arising from the instant project.Accordingly,some owners may require the design professional to obtain project specific insurance,the limits of which are totally dedicated to the claims arising from the project.Typically,the premiums for this insurance are paid by the owner,consistent with the principle that the owner pays for the contractor's bonds. The design professional also considers specific project needs for insurance in reaching agreements with subconsultants on a project.Design professionals must often deal with situations over which they have no direct responsibility, such as injuries on the site,fire,or other physical damage to the construc- tion.Therefore,as mentioned above,it is crucial that the design professional be named as an additional insured on the builder's risk and liability insur- ance policies carried by the constructor and that the policies include the appropriate waivers of subrogation. 23.3.1(c)Insurance Needs of the Constructor Because the constructor controls and supervises the job site while work is under way,he or she is normally required to indemnify and hold harmless other parties who do not control the site,usually the owner and the design professional.In order to fulfill this obligation,a constructor is typically required to provide insurance to support this indemnification obligation in an amount specified by the contract with the owner.Insurance carried by the con- structor typically includes commercial general liability (CGL)that covers bodily injury and property damage;workers'compensation and employer's liability insurance to cover injuries to workers;and builder's risk insurance (if not provided by the owner).Insurance certificates evidencing the required coverages and limits are usually a condition of the contract with the owner. 23.3.1(d)Insurance Needs of the Design-Builder On design-build projects,the design-build entity should obtain the insurance policies that would be required of the constructor,plus professional liability insurance to cover design responsibilities.Because the risks to design-builders are greater,they should consult with insurance professionals about coverage needs for particular projects,as standard construction and/or professional liability insurance policies may not be adequate for one or more of the design- build team members.The legal structure of the design-build organization will also affect insurance needs. 23.3.2 Bonds Bonds are another means of managing certain construction project risks. Bonds are not insurance policies;rather they are financial guaranties provided by a third party (a surety company).Bonds are backed by assets of the per- sonal or corporate pledges of the parties whose actions or performance is being bonded.Typically,there are three types of bonds used on a construc- tion project:bid bonds,performance bonds,and payment bonds. 219 Bid bonds protect the owner from the risk of increased costs in the event that the constructor fails to enter into an agreement with the owner at the bid price. The bond typically states that the surety will compensate the owner for the difference between the lowest and second lowest bids if the low bidder does not enter into a contract after award. A performance bond guarantees the performance of the constructor's con- tractual obligations in the event the constructor is unable or unwilling to com- plete them.If the constructor defaults,the surety is liable under the performance bond to the owner for the completion of the contract.Typically in the event of a default (though not always),the surety hires a replacement constructor to complete the work. Payment bonds guarantee that persons providing labor and materials to the project will be paid the amounts due under their contracts.Payment bonds traditionally have been used as a means of reducing mechanic's liens on a project and often provide the only security for subcontractors and suppliers on public projects where liens are prohibited. 23.3.3 Warranties Warranties provide another means of reducing risk.Warranties can be expressly provided for under a contract,and in some cases may arise by law. The purpose of a warranty is to guarantee the quality of the materials or serv- ices provided by a construction trade or supplier.Warranty obligations may be general in nature,such as a general warranty that the project will function properly for a period of time,or may be specific,as is the case of warranties that equipment or systems will produce specific results.Like other risk man- agement techniques,parties must evaluate the costs of providing a particular warranty against the benefits that the warranty would provide. 23.4 LIABILITY When risks become actual losses,the resulting liabilities must be evaluated. Often,these liabilities are allocated in the contract documents.In this cir- cumstance,the contractual liability of one or more parties arises.If the par- ticular loss is not provided for under the contract,the law will generally allocate responsibility for the loss.Similarly,an owner may be responsible for claims by subcontractors through mechanic's lien statutes,despite con- tractual language that attempts to limit such liability.Project participants ben- efit from sensitivity to the potential liabilities arising from their role on a project,including professional liability,property damage,and bodily injury, and should seek legal counsel concerning legal liabilities to which they may be subjected. 23.5 AVOIDING CONFLICT Conflict is an inevitable aspect of most working relationships.The degree to which parties to a constructed project are able to acknowledge and manage conflict is an indicator of project quality.The first step in managing conflict 220 involves taking action to avoid it.Actions that can help stop conflicts from becoming actual disputes include: ¢Select team members who are professionally and financially capable of performing responsibly; ¢To the extent possible,balance the interests of team members with regard to schedule,payments,decision-making,and performance; *Structure contracts to allocate risks clearly and fairly so that all parties understand their responsibilities from the outset; ¢Perform contract obligations on time and maintain appropriate records; ¢When unforeseen or changed conditions arise,define problems quickly and work diligently to contain the condition and minimize impacts; ¢Cooperate with other team members and remain flexible; ¢Consider participating in a partnering exercise with team members to outline common goals and expectations on the project. Selecting project team members who are knowledgeable,motivated,and pre- pared to resolve their differences fairly and quickly is essential to project quality.Maintaining a team approach to the job is the best means of achiev- ing this end. 23.6 CONFLICT RESOLUTION Effective conflict resolution strategies are often geared toward resolving dis- putes at the lowest possible organizational level.This approach is based on the premise that as conflict moves up a chain of command and away from the work site and the people who have day-to-day knowledge of the facts involved,delay can result and the quality of the solution may deteriorate. If a conflict makes its way up the organizational ladder and still cannot be resolved through negotiation between the principals of the respective team member organizations,then the parties often benefit from a more structured conflict resolution procedure.A well-drafted contract provides procedures for conflict resolution without involving the courts,including: *Relying on the design professional to resolve conflicts between the owner and constructor (within the administration of the contract); ¢Mandatory mediation attended by relevant parties using a third-party mediator to help participants structure negotiations,provide neutral eval- uation,and encourage fair settlement; ¢The use of hearing officers,dispute review board judges,or standing neutrals to resolve disputes and provide binding decisions (when avail- able on public projects); ¢Binding arbitration (mandatory or voluntary),usually under rules adopted by the National Construction Industry Arbitration Committee of the American Arbitration Association (AAA); *Other alternative dispute resolution (ADR)processes,preferably bind- ing,including mini-trials and neutral fact-findings. 221 >Chapter 24,"Partnering” American Arbitration Association:www.adr.org The costs associated with these options vary,but can often be controlled by narrowing issues and limiting discovery.These procedures may be specified in the contract between the parties.In most cases,some type of ADR process can be a benefit before resorting to litigation. 23.7 LITIGATION Litigation of construction disputes is usually complex,expensive,and time consuming.Perhaps most significantly,litigation can be unpredictable and may place the outcome of a dispute in the hands of persons with no experi- ence on the project and little knowledge of the construction industry.This uncertainty can be magnified if a jury is assigned to hear the case.Therefore, parties may consider agreeing beforehand by contract to mutually waive their rights to a jury trial.Or,because of the perceived risks of litigation involving the particular facts and issues,it may be advisable for certain construction contracts to permit resolution of disputes by voluntary,binding arbitration. Regardless of whether the venue of the dispute is litigation or arbitration,a condition before participation in either venue should be mandatory mediation. If litigation remains an option,each participant carefully evaluates not only the merits of his or her case,but also the likelihood of how well the facts can be presented in a formal judicial proceeding.This analysis will involve,among other things,questions of witness availability and credibility and whether the case lends itself to a concise presentation to lay persons with little or no con- struction experience. It is important to recognize that in the pursuit of legal remedies,whether in litigation or arbitration,substantial direct and indirect costs are involved, including,but not limited to: «Direct external costs such as attorneys'fees,court costs or arbitrators' fees,deposition costs,expert fees,and costs of various investigations, such as soils,geology,hydrology and materials testing. ¢Direct internal costs,such as the costs of key personnel working with attorneys and experts to prepare for arbitration or depositions and trial, attending forum proceedings,and other incidental costs. ¢Indirect costs,including the interruption of management and key per- sonnel duties,impacts on professional and business reputation,reduc- tion in bonding capacity for the constructor,interruption of cash flow, and other costs.While many of these costs may be hidden in overhead accounts,they can be significant. *Loss of client relationship,either temporarily or permanently. In most cases,litigation is the last resort and least preferable way to resolve a dispute.In such instances,the parties are wise to conduct a thorough and dispassionate review of the costs and benefits of litigation throughout the con- flict.Even after litigation is initiated,such a review will assist in settlement negotiations before trial. 222 While binding arbitration may be a viable manner in which to settle disputes (especially relatively minor fee disputes),agreeing to mandatory arbitration prior to knowing the particular facts and circumstances at issue can effectively waive many safeguards that would otherwise be available in a court of law. Accordingly,when account is taken of the "hidden costs”of the application of relaxed rules of evidence (virtually everything is admissible at the sole dis- cretion of the arbitrator),the general lack of a written record or decision,and the inability to appeal almost any decision the arbitrators that is not fraudu- lent,the end result of arbitration may be more expensive than litigation. In sum,the greater the potential risk of loss and desire to appeal an adverse result,the more questionable it becomes whether any party should agree by contract to waive his or her right to litigate the issues in a court of law that offers of the attendant protections not offered in arbitration. SUMMARY Construction presents a variety of risks to the project participants.The risks range from personal injury and property damage to loss of profits and loss of reputation.These risks can be minimized through prudent risk management techniques,which include the evaluation of the project objectives,other team members,the selected delivery system,contractual provisions,and perform- ance expectations.Specific risk management tools such as insurance,bond- ing,indemnities,and warranties are helpful in this regard. When a risk becomes a loss,liability to some project members may ensue. This liability may be contractual or may be imposed by law.Whena party is perceived to have liability to another,conflicts between project participants often arise.These conflicts may,in some instances,be minimized by maintaining an atmosphere of cooperation and open communication.If a conflict cannot be resolved,the parties may attempt to reach a solution through informal means,or by a more structured settlement procedure.These con- flict resolution techniques are often described in the dispute resolution provisions of the contract.Whether disputes are subject to mediation, arbitration,or litigation,the parties should be aware of the potential tradeoffs associated with each venue.O 223 Chapter 23:Risk,Liability,and Avoiding Conflict Typical Responsibilities Responsibility Design Design-ig)Owner Professional Constructor Builder Evaluate project risks t e@ e@ e@ Evaluate other team members e@ e@ eS e Address risk in contractual agreements e e e@ e Reduce risk by ensuring contract e @ e @ performance Assess insurance requirements e@ e e @ Use bonds and warranties when @ @ e appropriate to assure performance Evaluate liability r )r )e e@ Establish conflict resolution procedures e ©©© (contracts,partnering agreements,ADR) @ =Primary Responsibility @©=Assist or Advise ©=Review 224 Panne is a process that enables project team members to work together,as partners,and establish good communication,develop common goals, reduce conflict,and solve problems in ways that deliver mutual benefits.At its core,partnering is geared toward developing good working relationships among project participants by creating an atmosphere of respect and trust. Since its inception on U.S.Army Corps of Engineers projects in the 1980s, partnering has been implemented successfully on thousands of projects and has come to be regarded as an important means of avoiding disputes and con- tributing to quality in the constructed project. Partnering may begin at any point in the life of a project,from the concep- tual planning phase,to design,construction,and even post-construction phases.In most cases,project participants begin formal partnering activities at the beginning of construction;however,an increasing number of owners are initiating partnering during earlier phases.Partnering is most often initi- ated by owners,construction managers,and contractors.It is a voluntary process that requires commitment,especially of senior management,to succeed. This chapter describes the potential benefits of partnering on constructed projects,and provides an overview of the partnering process,key steps in the partnering process,and special applications of partnering. 24.1 BENEFITS OF PARTNERING Partnering enhances project quality by improving relationships among proj- ect team members and results in improved management of risk,greater finan- cial control (fewer claims and cost overruns),timely completion,increased job satisfaction and camaraderie among project participants,and reduced lit- igation (see Figure 24-1). 24.1.1 "Win-Win”Solutions Construction projects bring together a diverse group of people,each with different backgrounds,experiences,abilities,interests,and styles of commu- nication.It is in the interest of project quality to enhance the relationships among these people.The more common "win-lose”approach to design and construction,which is modeled on the adversarial precepts of the judicial sys- tem,tends to undermine effective working relationships,and the bias toward "winners and losers”reduces incentives to innovate and solve contemporary construction problems.On construction projects,where the interests of participants tend to overlap,an adversarial approach can undermine sound business decision-making and cause everyone to lose. 225 CHAPTER 2 4 PARTNERING In this chapter 24.4 24.2 24.3 24.4 Benefits of Partnering 24.1.1 "Win-win"Solutions 24.1.2 Improved Relationships (High Performance Teams) 24.1.3 Improved Risk Management 24.1.4 Greater Financial Control 24.1.5 Improved Productivity, Timeliness,and Job Satisfaction 24.1.6 Reduced Litigation Principles of Partnering 24.2.1 Prerequisites for Partnering 24.2.2 From Conflict to Coherence 24.2.3 Misperceptions Elements of Partnering 24.3.1 Identifying Stakeholders 24.3.2 Participated Stakeholder Buy-In 24.3.3 Pre-Partnering Process 24.3.4 The Partnering Session 24.3.5 Follow-Through and Evaluation Special Applications of Partnering 24.4.1 Small Projects 24.4.2 Long Projects 24.4.3 Issue-Focused Partnering Partnering is voluntary;it requires the commitment of the project participants-especially senior management. LL)Getting to Yes,2nd Edition, Roger Fisher and William Ury, Houghton Mifflin,1992. ty Harvard Mediation Project:www.pon.harvard.edu Figure 24-1 Benefits of Partnering 12% 10% 8%+4 6%+ 4%4 2%+4 IH0%ai Je aeCostChangeClaimValue Increase Order Cost Engineering Cost Services[|Non-Partnered Partnered Source:"Partnering Project Performance in U.S.Army Corps of Engineers,”ASCE,1992. Partnering rejects the "win-lose”paradigm in favor of "win-win”strategies. A simple but often misunderstood catch phrase,"win-win”actually requires that project team members redouble their efforts to cooperate and solve prob- lems together.Partnering encourages the team to be creative in solving prob- lems and managing conflicting interests to achieve outcomes that are fair. 24.1.2 Improved Relationships (High Performance Teams) Partnering provides a forum for project participants to meet and agree on their approach to the project with an emphasis on procedures for resolving dis- agreements and disputes.One of the reasons partnering is so effective in resolving conflict is that the respect and trust established in the early,form- ative stages of a project help to carry participants through any disputes that do arise. Partnering provides participants with a greater degree of control over their relationships with fellow team members.Partnering encourages participants to work together to determine the most effect strategies for communicating, cooperating,coordinating the work,and resolving conflicts within the frame- work of the contract documents. 24.1.3 Improved Risk Management Construction projects generally involve significant risks,primarily in the areas of finance and safety.Therefore,enhanced efforts to deal effectively and fairly with risk reduce the potential impacts of disputes.Many,if not most,disputes involving litigation have their roots in poor relationships and communication. Partnering focuses on reducing risk in five common areas shown in the left column of Figure 24-2. 226 Figure 24-2 Public Sector Benefits of Partnering Traditional Partnering Number of Projects 36 16 Contract Amount $400 million $160 million Average Project Size |$11.1 million $10 miltion Cost of Changes 16.5%2.5% Duration for Changes 18.2%8.1% Change Order Costs 15.2%3.9% Claim Costs 17%0.01% Value Engineering 0.4%4.2% Source:Cll 1996 Common risk reduction strategies include: Communication:Establishing an atmosphere of honesty and openness that promotes early and proactive discussions of real and potential problems. Coordination:Acknowledging and respecting each participant's role, scope,and schedule. Decision making:Defining a process for solving problems. Delays:Identifying delays early through careful,detailed sched- ule monitoring;examining and dealing with the reasons for differences between forecast and actual progress. Financial:Basing negotiations on equity and fairness rather than power and intimidation. Professional:Acknowledging that professional reputations are closely tied to project success. 24.1.4 Greater Financial Control Partnering has come to be recognized as an effective strategy for controlling project costs.Partnering helps lower administrative costs and reduce the num- ber and frequency of cost overruns,offering the project greater opportunity for financial success.In a 1994 study,the Construction Industry Institute (CII) concluded that properly implemented partnering programs yield savings rang- ing between 4 and 30 percent of total project cost,representing a significant competitive advantage. 24.1.5 Improved Productivity,Timeliness,and Job Satisfaction At the personal level,partnering helps the members of the project team focus on the tasks that they do best:designing and building projects.Disputes and litigation tend to distract team members from their jobs.By reducing conflict and valuing innovative solutions,partnering can help boost the job satisfac- tion of participants and help them to be more productive and innovative. 227 Construction professionals at the worksite are generally more knowledgeable and better able to resolve most disputes than judges and lawyers in courtrooms. 24.1.6 Reduced Litigation Like many other industries,engineering and construction witnessed an explo- sion of litigation in the last two decades.Partnering achieves consistent and dramatic results in reducing claims and litigation-to the point where some insurance providers reduce premiums or cover a portion of partnering fees for projects that utilize partnering in acknowledgement of the likelihood of sub- stantially limited financial risks from litigation and disputes. 24.2 PRINCIPLES OF PARTNERING Most partnering advocates agree on a basic concept:partnering is about peo- ple.The human relationships involved in developing and building a con- structed project are often more complex than the project itself.Partnering takes human relationships seriously and strives to manage them according to a set of fundamental principles,as described in the three following sections. 24.2.1 Prerequisites for Partnering Partnering flourishes when stakeholders share several basic behaviors when approaching problem solving: *Common "ownership”of projects-the joint acceptance of the respon- sibility to identify and resolve problems. ¢A commitment to fully disclose information that will aid the project team in reaching the best decisions possible. *The delegation of authority to empower participants to resolve conflict and make appropriate decisions at the project level. ¢A focus on attacking problems (not people)based on the best interests of the project as a whole. ¢A commitment to the partnering process as well as the willingness to accept its outcomes. ¢Genuine respect and trust among project participants. 24.2.2 From Conflict to Coherence Partnering can benefit project quality under a variety of circumstances.The following four categories describe general project conditions and the value that partnering may bring to each. 5 Team Situation SEER Description SF4LF Partnering Benefits High Performance ¢Trust among members -*_Provides opportunities is high;creativity to fine tune perform- drives a coherent,ance and achieve proj- unified effort.ect objectives as completely as possible. Functional ¢Participants have a ¢Directs team activities history of working toward successful together successfully.project planning and processes. 228 Disarray ¢Participants are suspi-*Builds relationships cious of or unfamiliar and trust to allow with each other.members to begin to function as one team. Open Conflict ¢Participants are dis-¢Helps control chaos trustful;conflict has and lays groundwork erupted.for resolving differences. 24.2.3 Misperceptions As a relatively new practice,partnering still endures some misperceptions within and outside the construction industry.This section addresses some of the more common ones. Partnering is not legally binding.The partnering agreement (see 24.3.4(a))is not a contract.Rather,it is a personal commitment by the participants to pur- sue the project's mission,goals,dispute resolution process,evaluation pro- cedures,and partnering values.The agreement also represents an organization's commitment to achieving the partnering objectives. Partnering is not a substitute for the construction contract or for the laws and regulations under which the contract was issued.Partnering is not a waiver of rights-legal,political,and other avenues of dispute resolution remain open to the parties. Partnering is not an excuse to compromise one's level of effort.In fact,part- nering requires that project participants make extra efforts,above and beyond those that might be expected with conventional project relationships,to resolve problems.Partnering does not force an owner to accept poor quality. Partnering does not eliminate disputes,disagreements,or problems.It is nat- ural for problems to arise and for dedicated,qualified professionals to dis- agree on occasion.Partnering provides team members with the opportunity for constructive debate and the airing of potential solutions,as well as a process that leads to the resolution of problems in a timely manner. Partnering does not involve compromising one's better judgment.Project part- ners are empowered to communicate,explore problems,develop solutions, assess the merits of solutions-and play a role in the decision to implement them. 24.3 ELEMENTS OF PARTNERING To achieve the values and benefits described above,partnering employs a structured approach that is geared toward creating teamwork and shared val- ues.The elements of this approach include:the identification of project stake- holders;getting them to "buy in”to the partnering program;planning the pre-partnering phase;holding the partnering session itself,including the devel- opment of the partnering charter and issue resolution strategies;and following 229 American Arbitration Association:www.adr.org Arizona Department of Transportation: www.dot.state.az.us/about/ partner U.S.General Services Administration: www.gsa.gov/pbs/pc/gd_ files/partner U.S.Army Corps of Engineers: Wwww.usace.army.mil through with partnering commitments and implementation.The following sections describe these elements of the partnering process. 24.3.1 Identifying Stakeholders Partnering acknowledges that there are many people and organizations with a vested interest in the success of a given project.These project stakeholders include those who are participating directly in the project,as well as those people and organizations who may be affected or have an interest in the process or outcome.The roles,interests,and objectives of stakeholders pro- vide insight into potential opportunities and problems associated with the proj- ect.Stakeholders may include: ¢The end-user ¢The constructor ¢The owner ¢Subcontractors ¢The funder ¢The project work force ¢The design professional *Suppliers and vendors ¢The construction manager Regulatory agencies ¢Members of the community The commitment of senior management and project leaders to partnering is essential to the success of any partnering program.It is critical that at least one key senior manager serve as a visible "champion,”or advocate,of the partnering effort.The champion helps educate and introduce team members to the key values of partnering,including: ¢Cooperation ¢Fairness (win-win environment) *Respect ¢Joint problem solving ¢Trust ¢Working for mutual gain ¢Open and honest communication ¢Rapid dispute resolution at the ¢Teamwork lowest possible level 24.3.2 Participant and Stakeholder Buy-In Partnering succeeds,in large measure,because it is voluntary.Team mem- bers must obtain the concurrence of the other participants before partnering can proceed. The owner is typically the first participant to signal an interest in initiating partnering by incorporating appropriate language in the bid documents that announces the owner's desire to partner and encourages the design profes- sional,constructor,and/or design-builder to participate.The owner also addresses how partnering expenses will be paid (usually shared equally).If the owner does not incorporate such language in the bid documents,the design professional,design-builder,or constructor may express his or her interest in partnering during negotiations or after the award of the contract,though it is preferable to indicate such an interest as early as possible. 230 Securing buy-in to the partnering process is a crucial,yet highly unstruc- tured aspect of the partnering process.Team members must rely on their best judgment in approaching others to advocate for a partnering program. 24.3.2(a)Sharing Program Costs One of the first tasks of a newly formed partnering team is deciding who will pay for the program.The responsibility for partnering costs is often addressed in the contract documents.If not,fairness is the principal concern,as each participant faces varying financial constraints. 24.3.2(b)Selecting a Facilitator Most partnering programs benefit from the services of a neutral professional facilitator.Experienced facilitators have background and training in the tech- niques of partnering,as well as in construction.Facilitators prepare materials for workshops,suggest communication techniques,aid in establishing goals, serve as negotiator,and perform other tasks.The presence of a facilitator is also a benefit in diffusing tension among stakeholders.Desirable qualities in a facilitator include: *Knowledge of the design and construction industry; Skill in facilitation; *Experience in training; ¢Neutrality; Background in strategy development and negotiations; *Familiarity with organizational development concepts and practices. 24.3.3 Pre-Partnering Process The pre-partnering process involves gathering information about the project and assessing the motivations and challenges of the stakeholders.These activ- ities are typically conducted or managed by the facilitator,who uses the infor- mation to design a partnering process geared toward aiding the stakeholders in achieving their goals for the project.Pre-partnering activities include: ¢Meetings or interviews between the facilitator and representatives of each organization to identify issues that are critical to project success; *Conference calls including the facilitator and the leaders of each organ- ization to plan the session; *The completing of a questionnaire by stakeholders. In preparation for the workshop,the facilitator reviews the information yielded by these activities,uses it to develop the partnering program or agenda,and may prepare it in summary form for reference at the partnering session. 24.3.4 The Partnering Session The central element of the partnering process is the initial partnering work- shop-the face-to-face meeting of stakeholders.While the goals and 231 stakeholders of any given project are unique,every partnering session addresses a basic set of topics that include: ¢Teams and team-building strategies; ¢Development of a vision or mission statement; ¢Problem solving procedures; ¢Dispute resolution procedures; ¢Evaluation procedures; ¢The follow-through process; ¢The signing of the partnering agreement or charter; ¢Producing a summary of the partnering session. 24.3.4(a)The Partnering Agreement (or Charter) At the partnering session,the participants usually develop a partnering agree- ment,or charter,that is signed by project participants at the conclusion of the session.The agreement affirms the commitment of the signatories to conduct project business in a professional and productive manner,and to produce qual- ity work within the project schedule and budget.Partnering agreements are not binding contracts,and the decision to sign is entirely voluntary. Sample language for partnering agreements is available from a variety of sources,including ASCE,the U.S.Army Corps of Engineers (USACE),the American Institute of Architects (AIA),and the Associated General Contractors (AGC).Partnering facilitators are also often able to provide sam- ple language for such an agreement. Agreements are most effective when created to be unique to the project.The following general goals are typical of most partnering agreements: *To engage in open,honest,complete,and timely communication with the participants; ¢To increase the resources available to the owner by effective,friendly, and knowledgeable teaming; *To develop informed,practical understanding of the needs,strengths, and expectations of the partners; *To reach common understanding of project goals,including participa- tion in scope development,criteria review,and technical guidance evaluation; ¢To employ measurable goals wherever possible; ¢To mutually explore and use new,innovative,and reliable technologies to produce excellent products that advance the state of the art; ¢To "do the right thing,the first time”; *To achieve a "zero-item”punch list; ¢To maintain a clean and safe workplace with no injuries and no lost- time accidents; ¢To allow the partners to profit reasonably from the project; *To eliminate litigation and cost overruns; *To make the workplace an enjoyable environment. 232 24.3.4(b)Issue/Conflict Resolution One of the hallmarks of partnering is the emphasis on resolving disputes as close to their source as possible.The partnering process for resolving disputes generally involves a series of steps and associated timeframes within which to elevate an issue or problem.The time frame is critical in assuring prompt resolution and eliminating the frustration that comes from indecision and often damages team relations. The length of the partnering session depends on the complexity of the proj- ect and the need for enhanced relationships among the participants.Two-day sessions are usually optimal for developing positive,productive relationships and exploring potential project problems in depth.One-day sessions tend not to provide enough time for a desirable level of team building activity,but usu- ally do provide participants with enough time to address problem solving. 24.3.5 Follow-Through and Evaluation Periodic progress reviews are an important means of gauging the project team's success in achieving its goals and maintaining the commitments made at the initial partnering session,as well as the partnering process itself.The development of quantitative measures is a proven strategy for stimulating progress.Such measures include: ¢Number of goals achieved; *Percentage of progress toward goals; ¢Number of new issues or problems identified and resolved; ¢Number of significant successes or milestones achieved. Follow-through often includes written surveys filled out by team members to assess progress toward goals,the effectiveness of relationships,and the value of partnering activities.To encourage participants to provide feedback,eval- uation tools,such as surveys,should be concise and solicit quantitative and qualitative information. Another,though less quantitative,form of follow-through is a regular review or "check-in.”With a desired frequency of once every one to two months, partnering check-ins can often be accomplished during normal project busi- ness,such as the inclusion of partnering on the agenda of a regular project progress meeting.Other types of check-ins include separate meetings for part- nering issues only or informal team events. The partnering champion(s)plays a key role in follow-through,taking the ini- tiative for such activities as: «Setting aside a regular time to review project accomplishments; *Keeping a list of achievements and positive developments; *Keeping a list of concerns and issues for improvement; ¢Reviewing the mission statement daily; ¢Meeting with other partnering champions; 233 >23.3 "Avoiding Conflict” Follow-through evaluation of the partnering process should be based on real data-not hunches. Sample Follow-Through Questionnaire Items 1.ls communication satisfactory? 2.Has the team established reasonable goals? 3.Is the team reaching those goals? 4.Are there opportunities to improve communication among the team? 5.Are there obstacles to achieving the goals the team has set? *Soliciting opinions from people at all levels of the project; ¢Preparing new information and ideas for meetings. Finally,follow-through involves the acknowledgment of successes-at inter- mediate stages of the process and at.its conclusion.Spontaneous celebrations make an invaluable contribution to positive working relationships and help diffuse the tensions that normally crop up when people work together. 24.4 SPECIAL APPLICATIONS OF PARTNERING As with many other processes in constructed projects,the key to success in partnering depends on tailoring activities and tasks to meet the needs of the project at hand.This section discusses partnering variations structured to meet the needs of different types of projects. 24.4.1 Small Projects While partnering has generally been used on many large projects in the U.S. (generally those greater than $5 million),the process offers benefits to small and mid-size projects as well.Smaller projects tend to be shorter in duration, which increases the urgency of activity and interaction.There is less time to develop the project team,establish honest open communication,develop trust, and co-create solutions.The project schedule and budget of small projects are also less forgiving of any errors. In such cases,one-day or half-day partnering sessions can be valuable,with an abridged agenda including: *Introductions *Goals and actions *Partnering overview ¢Dispute resolution procedures ¢Drafting a mission statement ¢Evaluation ¢Key project issues ¢Signing the partnering agreement ¢Creative problem solving A professional facilitator is an extremely valuable resource in abbreviated partnering sessions,helping participants become familiar with the basics of the program within a very limited time frame.The facilitator's value is directly related to his or her ability to be neutral,and the use of an in-house facilita- tor is strongly discouraged. 24.4.2 Long Projects If a project lasts more than a year,an initial partnering session of no less than one full day is strongly recommended,followed by follow-up sessions at key milestones or at intervals of no less than one year.The initial sessions help to establish the basis for the personal relationships on which much of the proj- ect success will depend.The follow-up sessions provide participants with an opportunity to reaffirm the project goals and look at the project's "big pic- ture,”as well as more immediate project milestones. 234 24.4.3 Issue-Focused Partnering The success of partnering in improving the quality of constructed projects has prompted project leaders to focus partnering efforts on single issues or areas of specialized concern.In these issue-focused forms of partnering,the proj- ect team may benefit from the participation of an independent expert with related experience. Types of issue-focused partnering include: Turn-around:A process geared toward quickly resolving,or "turning around,”a significant dispute and promoting the healing of relationships.Turn-around partnering is often attempted when participants have left the negotiation table and com- munication needs to be re-established. Program:A series of partnering sessions designed to address the sep- arate stages of a large project or of several smaller related projects.Program partnering works well on projects with multiple constructors.The series of sessions would be likely to include a kickoff session,site partnering,shell partnering,interior partnering,finishing partnering,and turnover/activation partnering. Inter-Agency:A valuable approach when two or more public agencies are involved in the same project or have a similar mission,as is often the case when federal and state agencies share man- agement or oversight responsibilities.Typical goals for this type of partnering include identifying and agreeing to the roles of each agency,as well as defining a process for com- pleting the project. Environmental:A benefit during the planning stage and preparation of envi- ronmental documentation.Environmental partnering brings together regulatory agencies,environmental groups and stakeholders,and project participants to work toward agree- ments on the interpretation of regulations,the use of data, permitting,and other related activities. Design Intent:An opportunity for the design professional to communicate the intent of the design to the owner,constructor,and sub- contractors. SUMMARY Partnering is one of the most effective non-technical strategies developed in the last two decades for improving the quality of constructed projects. Professionals throughout the construction industry recognize how partnering helps manage project risks and improve quality,reduce cost and schedule overruns,and eliminate litigation. 235 Successful projects do not just happen.They are made to happen. USACE Col.(retired) C.E.Cowan Partnering is not a magic bullet,and it is not a substitute for contract com- pliance.It requires that participants make an extra effort and reach out to each other in difficult circumstances-at the very time that it may be most diffi- cult to do so.It also requires follow-up and nurturing. Partnering offers an effective strategy for managing and enhancing the rela- tionships among the owner,design professional,constructor,subcontractors, specialty personnel,agency participants,and other stakeholders that places emphasis on positive,proactive relationships and focuses on quality.O Chapter 24:Partnering Typical Responsibilities* Responsibility Design Design- Bo Owner Professional Constructor Builder Initiate partnering program e e@ e@ e@ Obtain participant and stakeholder buy-in @ e e@ e Establish responsibility for partnering e e r e costs Engage facilitator @ e @ @ Manage pre-partnering process e@ e@ e e@ Participate in the partnering session e e@ e@ e} Draft and sign partnering agreement eo e@ e e@ Encourage open,honest communication @ e@ @ e Follow-through r @ e e "Because partnering is voluntary,all parties share primary responsibility for the tasks listed,even if he or she does not initiate the partnering process. *.Po?.opps ..«oneWhileeachparticipantholdsprimaryresponsibilityforhisorherrespectivefollow-through activities,the part- nering champion(s),who may be a member of any of the participant organizations,oversees follow-through. @ =Primary Responsibility @ =Assist or Advise ©=Review 236 Additional Partnering Resources A Project Partnering Guide for Design Professionals,American Consulting Engineers Council. Defining Partnering Language:A Practical Guide Implementing the Partnering Process Guidelines for Facilitators,American Arbitration Association. Partner Your Project,Sue Dyer,Pendulum Publishing,1997. Partnering for Success,Thomas Warne,ASCE Publications,1996. Partnering:Changing Attitudes in Construction,Associated General Contractors,1996. U.S.Army Corps of Engineers,Publication ER 1110-1-12 (www.usace.army.mil). 237 CHAPTER 2 5 VALUE ENGINEERING alue engineering (VE)is a systematic approach to identify a project's functional objectives with the goal of optimizing design,construction, and future operations.Value engineering studies are conducted by a multi- disciplinary team that focuses on a clearly defined scope.While each mem- ber of the project team is free to recommend that a value engineering study be undertaken,it is typically the owner's responsibility to authorize and for- mally initiate a VE effort. The VE process originated at the General Electric Company in the 1940s in response to materials shortages during World War II.VE has since grown from a strategy for optimizing product procurement to a powerful tool with the capability to enhance the value of constructed projects,as well as industrial processes and manufactured products.Some form of VE is now stipulated on many government projects. 25.1 THE CONCEPT OF VALUE In its broadest sense,project value is determined by the relationship of the worth of the project and its elements to their cost.The following expression summarizes the relationship: Function +Performance +Quality CostValue= The goal of the VE process is to identify alternatives that maximize this value relationship.The owner's requirements are the basis for establishing values for the items in the numerator.For example,an owner who intends to sell a facility within five years of its completion may place less value in long term maintenance characteristics than an owner who intends to keep a facility for decades.Owner requirements directly affect the relative value of aesthetics, reliability,sustainable development,maintainability,operability,construction duration,and other characteristics.Improving the quality of elements related to these characteristics usually increases cost.The goal of VE is to achieve a ratio of quality to cost that is acceptable to,and in the best interest of,the owner. 25.2 THE BENEFITS OF VE The benefits of VE usually come from improvements in the efficiency of the project delivery system,refinements to specific features,or the development of new approaches to achieving the owner's requirements.The first item most owners look at when they consider value engineering is the potential cost 239 In this chapter 25.1 The Concept of Value 25.2 Benefits of VE 25.3 The Timing of VE Studies 25.3.1 When to Apply VE 25.3.1(a)Conceptual Design 25.3.1(b)Schematic and Design Development 25.3.1(c)Contract Documents 25.3.1(d)Construction 25.3.2 Project Size and VE 25.3.3 Duration of VE Workshops 25.4 VE Team Composition and Qualifications 25.5 Stages of VE Study 25.5.1 Preparation (Cost Models} 25.5.2 Workshops and the Six-Phase VE Job Plan 25.5.2(a)Phase 1: Gathering information 25.5.2(b)Phase 2: Function Analysis 25.5.2(c)Phase 3:Creative Alternatives 25.5.2(d)Phase 4: Evaluation 25.5.2(e)Phase 5: Development 25.5.2(f)Phase 6: Presentation 25.5.3 Post-Workshop Activities 25.6 Additional VE Considerations VE focuses on improving the relationship of function,performance, and quality to cost-not merely cutting cost. savings.However,VE focuses on improving the relationship of function,per- formance,and quality to cost-not merely cutting cost. As examples,in addition to financial benefits,VE provides the following ben- efits to project quality: *More complete definition and fulfillment of the owner's goals and objec- tives; ¢Development of a complete spectrum of alternatives; ¢Timelier assessment of alternatives and costs; *Confirmation of scope; *Better project configuration,operation,and durability; *Enhanced sustainable development input; *Improved communication and consensus among project participants; *More desirable impacts to outside entities; ¢Reduced life-cycle costs; ¢More effective deployment of staff. 25.3 THE TIMING OF VE STUDIES While VE studies can benefit project quality at most stages of development, VE studies conducted in the early stages of a project tend to provide the greatest benefit (Figure 25-1).In fact,in recent years VE has become an aid to owners in the formulation of goals and objectives-before most design work begins. Traditionally,VE studies are undertaken at one or more of the following proj- ect stages: *Conclusion of concept or facilities planning; *30-percent design completion; *60-percent design completion; 90-or 100-percent design completion. VE studies performed during the early stages of a project tend to address broad project concerns related to the selection of the right design concepts and ele- ments to achieve the owner's goals and objectives.The identification of effec- tive solutions during conceptual planning tends to provide greater savings in life-cycle costs than efforts to "fine-tune”a less-than-optimal approach that has progressed into design.This proactive strategy also saves on additional design fees.VE studies performed in the latter stages of a project tend to focus on getting the best value from the project elements that have been selected. While controlling cost and addressing budgetary constraints can be important aspects of value engineering,VE is not merely a cost cutting exercise.VE studies focus on improving the relationship of function,performance,and quality to cost,whereas cost cutting typically involves reducing project func- tion or scope.This distinction can be crucial to the effectiveness of VE stud- ies,as participants who misunderstand VE's purpose may not trust the process or offer their full participation,both of which are necessary for success. 240 Figure 25-1 Effectiveness of Value Engineering Costi)i) 1 i) 1)i) 1 i) 1 1) (' i)1 i)i) Proactive Value!Traditional Value ConstructabilityEngineering|Engineering |Review Zi Cost Savings Potential Change Varies with Type Cost to of Project Concept Development Design Time Construction or Production VvVE studies can also provide an agency or organization with information to determine if a project is consistent with a new organizational mission or policy. 25.3.1 When to Apply VE VE can enhance project quality at every stage of project development.The following sections discuss VE's application and potential benefits during var- ious phases of design. 25.3.1(a)Conceptual Design Increasingly,VE is being performed at the conceptual design phase to improve the quality of project design.In this phase,VE involves the investigation of alternative design concepts with the owner,design professional,project or construction manager,design-builder,and any other conceptual design par- ticipants.The project team works to identify the owner's requirements and to design concepts with the potential to achieve them.This process offers an array of benefits,including: *Team consensus; Shorter design schedule; Realistic budgets; *Early evaluation of construction sequencing and contracts; ¢Early user input; ¢Improved communication among the project participants. 241 >11.3.2,"Sustainable Development” 25.3.1(b)Schematic and Design Development VE may be applied during the schematic and design development phase.At this point,preliminary plans are on paper,but the members of the project team- particularly the design professional-still have considerable flexibility.Major changes resulting from VE studies can be implemented without significant impacts to the project schedule or design budget.The potential for VE-related cost savings is quite substantial during this period.Among the benefits of VE studies during this phase are confirmation of the owner's goals and objectives, validation of the design approach,and overall optimization of the design. 25.3.1(c)Contract Documents VE studies that are undertaken in the contract documents phase (60 percent completion or more)yield the most benefit when the focus is on con- structability and design details.In this phase,VE does not reconsider funda- mental project goals and design concepts,as the costs of making such revisions usually outweigh the savings. 25.3.1(d)Construction VE recommendations made during the construction phase are called Value Engineering Change Proposals (VECPs).They commonly follow a format that shares the adopted savings between the owner and the constructor,after deducting expenses related to engineering development and review of the pro- posed change. VECPs usually relate to the construction methods,materials and equipment; they often result from the fact that one constructor may build things differ- ently than another.Unless the constructor is involved in the design phase of the project,the contract documents will be based on a "generically”con- structable design.This design may or may not fit the method of operation for the constructor eventually selected by the owner. In general,the larger and more complex a project,the greater benefits that a VE program can provide.The appropriate number and frequency of VE reviews varies with the objectives of each project.The following are offered as guidelines: GREE Project Size or Complexity VE Application 2s Small (less than $3 million VE studies tend to offer the most benefit construction cost)during the conceptual stage,when design is approximately 10 to 20 percent complete. Medium ($3 to $30 million ©One VE study when design is approximately construction cost),20 to 30 percent complete usually offers the uncomplicated most benefit. Large (more than $30 million Two VE studies usually provide the most construction cost)or benefit:one at the concept phase (10 to 20 highly complex percent design complete)and the second when design is approximately 65-75 percent complete. 242 A rehabilitation project requires special VE consideration.In these projects,the key often lies in identifying the need for the project,and thus a conceptual study often provides the most benefit.However,once the need for a rehabilitation project is established,such efforts require close attention to detail.Therefore, the ideal time to convene a VE study for a rehabilitation project is when suffi- cient details have been developed to allow a unit quantity cost estimate. 25.3.3 Duration of VE Workshops The period when the VE team works together in a workshop varies with the size,nature,schedule,cost,and complexity of each project.When VE is per- formed,traditionally at 30-percent design completion or later,workshops typ- ically last three to five consecutive days. However,when VE methodology is used to develop a project concept,the entire study may last weeks or months,a period that is typical for conven- tional conceptual project development.The initial VE workshop for project development may last two to three days.For complex projects,the team may disband to continue developing concepts on their own and reconvene as nec- essary for follow-up workshops of two to three days to reevaluate and refine the scope and mission of their effort. Generally,project cost is a contributing factor in determining the appropriate level of VE effort,though by no means the only factor.Projects with similar scopes but different scales may have VE workshops of similar duration.The complexity of the project and amount of information available are also fac- tors in determining the appropriate VE effort.Workshops held during the early stages of a project can often be completed more quickly,as there are rela- tively few details to review,whereas a workshop at the 30-or 100-percent design completion level will likely involve many documents and constraints. 25.4 VE TEAM COMPOSITION AND QUALIFICATIONS The success of a VE effort is strongly linked to the experience of the team members.The number and qualifications of VE team members depend on the project objectives and stage of development.VE studies typically involve multiple disciplines.Therefore,VE teams benefit from members with diverse backgrounds who have a range of expertise with the project's key issues. Positive attitude,technical knowledge,education,certification,and profes- sional experience are also desirable qualities for each member of the team. The VE team leader plays a crucial role in the success of a study,as this per- son is responsible for managing all aspects of the effort.Good VE team lead- ers have training and experience as a facilitator,team leader,or team member on previous VE studies.Strong leadership,management,and communications skills are important qualities in a VE leader.SAVE International,the profes- sional association for value engineers,manages the Certified Value Specialist (CVS)program to certify VE team leaders. VE teams working on conceptual development benefit from the participation of members with planning and technical experience within the organizations 243 ay VE on the WebSAVEInternational: www.value-eng.org Federal Highway Administration: www.fhwa.dot.gov General Services Administration:www.gsa.gov American Association of State Highway and Transportation Officials: www.aashto.org responsible for producing the concept.All project participants are represented or participate in this process,including the owner,operator,construction man- ager,program manager,and,if possible or appropriate,future users of the facility or the public.Team members with experience in finance and pro- curement may also be valuable. For VE studies conducted during the concept and design stages,the study team mirrors the project team,with a study member representing each tech- nical discipline on the project team.A more experienced VE team is needed when VE is performed during the concept design phase because participants must be able to visualize the project with limited information.In some cases, the VE team's work is independent of the design professional;in other cases, the VE team may work closely with the designer.Members of the design professional's staff may even be members of the VE team in cases where the project concept has been established by an entity other than the design pro- fessional.In general,the best VE teams provide a fresh,objective look at design issues. 25.5 STAGES OF VE STUDY As shown in Figure 25-2,VE studies typically consist of three sequential stages: 1.Preparation 2.Workshop (execution of the VE job plan) 3.Post-workshop Figure 25-2 VE Process Summary PREPARATION Coordinate .Prepare for x Constructproject7workshopEcostmodels WORKSHOP Information naive Creative Evaluation x Development x Presentationphase>)hase >|phase >|E |of alternatives POST-WORKSHOP VE study FinalreportiImplementation>acceptance 25.5.1 Preparation (Cost Models) Preparation is considered by many to be the most important step of a VE study. The tasks during this phase are summarized as follows: 244 *Defining user needs; ¢Recruiting VE team members with appropriate experience and qualifications; ¢Gathering and disseminating information to the members of the VE team; ¢Determining evaluation factors; ¢Establishing the scope of the study; ¢Building appropriate models; «Arranging for the presentation of relevant information at the workshop by appropriate members of the project staff. The VE team has a relatively short amount of time to develop a thorough understanding of the project and its status.Therefore,project leaders (includ- ing the owner,construction manager,design professional,and,if applicable, the operator)benefit by making sufficient and relevant information available to the VE team during the preparation period. Also during preparation,the VE team leader uses the most current cost infor- mation from the project team leaders to prepare cost models.These models typically depict the distribution of costs in one or more of four contexts,which are described below. Capital Cost:The initial cost to build the project is itemized,pro- viding a breakdown for element and construction tradecraft labor.This form of analysis allows the VE team to identify high costs and make comparisons with costs on similar projects. Life-Cycle Cost:All the costs of owning and operating the facility over its expected life span are totaled,including materials, labor,maintenance,energy,replacement parts,dis- posal or reuse of materials,and decommissioning. These costs may be provided for each element to aid in identifying high cost items.The time value of money is also considered. Energy Cost:Energy costs are itemized by system,subsystem,or functional area to identify high consumption and cost. Pareto Distribution Costs are displayed graphically according to order or Cost Histogram:of magnitude of project elements considered,aiding in the identification of high cost elements. The use of accurate and comprehensive cost data in the development of cost models is critical,as subsequent VE analysis is based on this information. 25.5.2 Workshops and the Six-Phase VE Job Plan The VE team convenes to execute the formal,six-phase VE Job Plan.The six phases of the workshop effort and Job Plan are described in the following sections. 245 >25.5.1,"Preparation (Cost Models)” >25.5.1,"Preparation (Cost Models)” 25.5.2(a)Phase 1:Gathering Information During the information phase,members of the project team make oral pre- sentations to augment the information already provided to VE team members. These oral presentations are a forum for the presentation and discussion of undocumented additional information that is typically encountered on con- structed projects,such as local history,political considerations,opportunities for sustainable development enhancements,or personal preference.These pre- sentations provide the VE team with personal accounts of the rationale for the current project approach and the difficulties encountered in achieving the proj- ect objectives.These meetings foster trust and understanding among the proj- ect staff and the VE team. The information phase also includes the review of the cost models and a site visit for first-hand knowledge of field conditions. 25.5.2(b)Phase 2:Function Analysis The heart of VE methodology is function analysis.This is the primary activ- ity that separates VE from other improvement programs and cost reduction techniques.During function analysis,the VE team defines the basic purpose of project elements and determines whether they are necessary to achieve the project objectives.Because function analysis is often misunderstood by those outside the VE process,an in-depth discussion is warranted. The team identifies functions using just two words:an action verb and a noun with a measurable quality to it.For example,the function of a highway guide rail might be "redirect vehicle.”Other examples include "kill bacteria,”"con- tain water,”"support load,”and so on.In some cases,the team may use one or two adjectives to modify the noun for clarity. After the team has identified the functions of the relevant project elements in this manner,they classify each function as either "basic”or "secondary.”Basic functions are those that are essential to meet the project goals;these must be fulfilled by any VE alternative proposed.Secondary functions support or enhance basic functions and may be modified or eliminated by VE alterna- tives.Function analysis proceeds sequentially,from the whole project down to its various subsystems and components. A systems approach can be valuable in classifying functions,allowing the VE team to visually relate a group of random functions within a project to better describe the entire system.The Function Analysis System Technique (FAST) Diagram (Figure 25-3)is a helpful diagnostic tool,asking questions that gen- erate basic information about project functions.For example,"Why redirect vehicle?”The team answers these questions using logic and intuitive responses,and the answers form links between the functions.The FAST dia- gram is especially helpful if the VE team is uncertain of project goals. After classifying functions,the VE team relates each function to cost.The cost models and the project team's cost data provide the basis for accom- plishing this task.The establishment of costs for each function allows the team to develop a comparison value for the function's worth.Worth is defined as the lowest cost required to perform the function. 246 LyeFigure 25-3 Function Analysis System Technique (FAST) HOW >KILL REMOVE DISSIPATE BACTERIA TOC ENERGY PROTECT DELIVER MEET IMPROVE ADD REMOVE KILL CONTROL DIVIDE PUBLIC CLEAN WATER REGULATIONS WATER CHLORINE ORGANICS CRYPTO FLOW FLOW 'H 7 :TRANSFORM REMOVE KILL REMOVE CONSOLIDATE PREPARE TRANSPORT RECEVE 'CHLORINE PARTICULATES BACTERIA SOLIDS SOLIDS RAW WATER RAW WATER RAW WATER TRANSPORT PUMP STORE 1 : IMPROVE FILTER KILL SETTLE MIX CONTROL MEASUREWHEN|WATER WATER WATER |H TASTE H WATER GIARDIA H |SOLIDS |[WATER ||pH |[FLOW | PREVENT H AOD : REMOVE OZONATE CONTAIN|ceaeocin ne [awe Loman FLUORIDIZE MIX IN ADD WATER CHEMICALS CHEMICALS COOL A00 PRODUCE SUPPLY EQUIPMENT OZONE OZONE OXYGEN CLEAN PUMP STORE FILTER BACKWASH WATER DISPOSE RESIDUALS LIMITS Establishing worth can be the most difficult part of function analysis.Worth is simply an indicator of the value of performing a given function,and a high degree of accuracy in estimating worth is not critical.Instead,worth is a mech- anism to identify areas of high potential savings.The team generates esti- mates of worth,or the target cost,of a function based on their experience on similar projects.Subsystems that perform secondary functions may have lit- tle or no worth because they are not directly related to the basic function.For example,an access road to a wastewater treatment plant does not provide the basic functions of "remove solids”or "kill bacteria,”and,therefore,repre- sents a savings opportunity. Finally,the team calculates a cost-to-worth ratio for the facility as a whole and for the systems and subsystems that compose it.Cost-to-worth ratios significantly higher than |indicate areas of large potential cost savings and identify systems or subsystems that are the object for further VE study. 25.5.2(c)Phase 3:Creative Alternatives The function analysis phase identifies project areas with a high potential for value improvement,setting the stage for the creative phase.The objective of the creative phase is to develop a broad spectrum of approaches for performing each function selected for study.The VE team approaches this phase uncon- strained by habit,tradition,negative attitudes,assumed restrictions,and spe- cific criteria.The team leader uses one or more methods to stimulate the group's creativity and generate lists of possible alternatives.To promote cre- ative thinking,the team suspends all analysis,evaluation,or judgment of ideas until the phase is completed. 25.5.2(d)Phase 4:Evaluation The goal of the evaluation phase is to identify the creative ideas that are fea- sible and worthy of further investigation.First,the team reviews the criteria for evaluation that were established during preparation.The team then dis- cusses the advantages and disadvantages of each idea.Using a predetermined scale,the team,as a whole,ranks each idea on how well it meets the criteria and on how well it performs the required function(s).The team continues the process until a consensus on the ranking of ideas is reached. The team groups ideas addressing a common function or discipline together. If none of the alternatives meets every criterion satisfactorily,it may be nec- essary to return to the creative phase,and using the knowledge gained during the evaluation process,create additional solutions.Competing alternatives for a particular function may be comparatively evaluated using a matrix analysis. The completed matrices,along with team judgment,can be used to determine the design that offers the best solution.In some instances,the original design may offer the best solution,in which case the team recommends no action. 25.5.2(e)Phase 5:Development In the development phase,the team develops the high-ranking ideas into viable alternatives.Starting with the highest ranked ideas,the team selects 248 "champions”for each idea.Drawing on the expertise of the team as neces- sary,the champions research and develop the ideas and provide preliminary designs and life-cycle cost comparisons.VE team members often consult out- side experts,vendors,and reference sources to obtain additional evaluation information before developing-and if necessary revising-the design alternative. Typical information that the champion provides in support of an alternative includes: *Written descriptions of the original concept and proposed alternative; ¢Sketches of the original and alternative designs; *Technical back-up data,including calculations,information sources, and literature; ¢Lists of advantages and disadvantages; *Costs (initial and life-cycle estimates;performance data on the original and alternative); «Aconcise argument in favor of the alternative that includes information on implementation,schedule (and potential conflicts)and other instances of successful implementations of the alternative. 25.5.2(f})Phase 6:Presentation During the presentation phase,the VE team reports the results of the work- shop to the decision-making body.One or more members of the VE team make an initial oral presentation,followed by a written report (prepared dur- ing the post-workshop activity). 25.5.3 Post-Workshop Activities After the workshop,the VE team prepares a report to support the implemen- tation process.At a minimum,the report includes the project description and objectives,the scope of the VE effort,VE procedures,and VE-recommended alternatives and supporting documentation. Implementation of the VE team's recommended alternative(s)requires thor- ough evaluation by the project owner and the design professional.A typical implementation process for a VE alternative is as follows: 1.The VE team's report is circulated to the decision-making authority and the design professional so that the proposed alternatives may be reviewed in detail. 2.Each person reviewing the VE team's alternatives generates an initial opinion as to whether each alternative should be implemented,modi- fied before implementation,or rejected. 3.The owner and design professional decide if the VE alternatives will be implemented.Alternatives requiring further modification or which fail to achieve a consensus among those responsible for reviewing them may be sent back to the design professional or VE team for revision. 249 Federal VE Guidelines 23 CFR Part 627 £1)Federal Acquisition Regulations Parts 48 and 52.248-1 25.6 ADDITIONAL VE CONSIDERATIONS While government agencies and other organizations regularly involved in construction often have well-defined VE programs,extra care is advised when implementing a VE study with an owner who may be unfamiliar with the con- cept.VE is more than a cost-cutting tool,and during implementation,any cost savings that are estimated to result from VE recommendations should be carefully weighed against the costs of additional design,construction,and operations and maintenance. This is especially true when VE is used near or at the end of the design process,when budget problems can emerge.In general,the further along a project is in the design process,the more difficult it is to save money with- out affecting function.Therefore,if VE is applied late in the design process, it is most valuable for reviewing issues of constructability and enhancing the coordination of construction documentation. Finally,VE study recommendations should be implemented after they have been reviewed by affected disciplines.Without such review,unforeseen additional costs or impacts may reduce function,increase costs,or diminish quality to unacceptable levels. SUMMARY Value engineering is a powerful project improvement tool that establishes the lowest cost to achieve the project objectives without sacrificing quality. It can be applied to construction projects,processes,and manufactured prod- ucts to develop an efficient concept or to significantly improve the value by improving quality and/or reducing cost. It is a well-developed,structured and utilitarian methodology that has been proven effective on countless projects for more than 50 years.The use of detailed function analysis sets VE apart from all other project improvement techniques.The involvement of a qualified value professional to lead the process will avoid simple cost-cutting and ensure a highly productive effort with a payback that is worth many times the initial investment.O 250 Chapter 25:Value Engineering Typical Responsibilities Responsibility Design Design- U Owner Professional Constructor Builder Initiate VE study © Establish scope of VE study Provide personnel for VE study team Provide information to VE team Make oral presentation to VE team Conduct VE study Oe8F@©@®@@®®e®e@®©®O®O®OO®6®@Review VE recommendations Implement VE recommendations O©*Under the leadership of a Certified Value Specialist (CVS)or other qualified VE facilitator. @ =Primary Responsibility @ =Assist or Advise ©=Review 251 ADVERTISEMENT FOR BIDS:Published public notice soliciting bids for a construction project or designated portion of a project;also included as part of the bidding documents. ALTERNATIVES ANALYSIS:Analysis of different alternatives in project lay- out,scope,sequencing,and other variables to determine their validity and impact on project cost,appearance,schedule,and socioeconomic and envi- ronmental conditions. ARBITRATION:A method of settling claims or disputes between parties to a contract,used as an alternative to litigation,under which an arbitrator or a panel of arbitrators,selected for specific knowledge in the field in question, hears the evidence and renders a decision. ARCHITECT:See Design Professional. ARCHITECT-ENGINEER:See Design Professional. BID:A complete and properly signed proposal to perform the construction required by the contract documents,or designated portion of the documents, for an amount or amounts stipulated in the documents.A bid is submitted in accordance with the bidding documents. BID DOCUMENTS:The advertisement for bids,the instruction to bidders,the bid form,other sample bidding and contract forms,and the contract docu- ments,including any addenda issued prior to receipt of bids. BID BOND:A form of bid security executed by the bidder as principal and by a surety to protect the owner if the low bidder does not accept the award of contract. BID FORM:A form furnished to a bidder to be completed,signed,and sub- mitted as the bidder's bid. BID OPENING:The opening and tabulation of bids that have been submitted before the prescribed bid opening time and in conformity with the prescribed procedures. BID SECURITY:The deposit of cash,certified check,cashier's check,bank draft,stocks/bonds,money order,or bid bond submitted with a bid.Also see Bid Bond. 253 GLOSSARY BIDDER QUALIFICATION DATA:Information sometimes required by the owner,and sometimes required by law,about the bidder's financial and phys- ical capability to perform the completed construction required by the contract documents,or designated portion of the documents. BONUS CLAUSE:A provision in the construction contract for payment of a bonus to the constructor for satisfactorily completing the work before a certain date. CERTIFICATE OF COMPLETION:A statement prepared by the responsible design professional on the basis of an inspection stating that the work,or a designated portion of the work is,to the best of his or her knowledge, substantially complete. CHANGE ORDER:A written order to the constructor signed by the owner and/or the owner's representative,issued after execution of a contract,that authorizes a change in the work or an adjustment in the contract sum or the construction schedule. CODES:Regulations,ordinances,or statutory requirements of federal,state and local governments related to building construction and occupancy that are intended to protect public health,safety,and welfare. CODES OF ETHICS:Official statements prepared by organizations repre- senting members of a profession that establish fundamental principles,canons, and guidelines of practice for the members of that profession. COMPETITIVE BIDDING:A method,often mandated by law,of selecting con- structors for construction projects by price competition between qualified bid- ders subjected to various rules and procedures. CONDITIONS OF THE CONTRACT:The portions of the contract documents that define the roles and responsibilities of the contracting parties and other participants. CONSTRUCTABILITY ANALYSIS:A review of the practical ability to con- struct a project,covering economics,availability of materials,site restrictions, and local conditions that may affect construction. CONSTRUCTION CONTRACT:The agreement,or contract,between the owner and constructor for construction of a project,or portions thereof,in accordance with contract documents. CONSTRUCTION MANAGEMENT:Management services provided to an owner during the construction phase of a project by an individual or entity possessing requisite training and experience. CONSTRUCTION SUPERVISOR:The constructor's representative at the site who is responsible for continuous field supervision,coordination,and com- pletion of construction. 254 CONSTRUCTOR:The individual or entity responsible for performing and completing the construction of a project as required by the contract documents. CONSULTANT:A person or entity providing specialized advice or services to an owner,design professional,or constructor. CONTRACT DOCUMENTS:The owner/constructor agreement,the Conditions of the Contract (General,Supplementary,and other Conditions), drawings,specifications,and all addenda issued prior to and all change orders issued after execution of the contract,and any other items that may be specif- ically stipulated as being included. CONTRACTOR:See Constructor. COST-BENEFIT RATIO:The ratio of costs expended to benefits received,in terms of present worth. DESIGN-BID-BUILD:The predominant form of contracting in the U.S.in which the owner separately engages a design professional to provide design services and a constructor to build the project.Also see Traditional Project Delivery. DESIGN-BUILD:A form of contracting where one entity,either a construc- tor or design professional,is responsible for both project design and construction. DESIGN DISCIPLINE:A category of related professional services,such as structural engineering,architecture,mechanical engineering,civil engineer- ing,electrical engineering,and others,requiring licensure or regulation in the state in which services are performed. DESIGN DISCIPLINE DELEGATION:The delegation of design services for a portion of the permanent project work to the constructor or specialty subcontractor. DESIGN PROFESSIONAL:A designation reserved,usually by law,for a per- son or organization professionally qualified and licensed to perform archi- tectural or engineering services.These services may include,but are not limited to,the development of project requirements;the creation and devel- opment of project design documents;the preparation of drawings,specifica- tions,and bidding requirements;and the delivery of design services during the construction and start-up phases of a project. DESIGN TEAM:The group of individuals or entities representing the design disciplines to be performed. DESIGN TEAM LEADER:The individual responsible for the coordination of design activities on a project.The design team leader is responsible for mon- itoring progress and reporting to the owner. 255 DEVELOPER:A private individual or organization that arranges for the financ- ing,design,and construction of a project.Private project owners are often developers. DRAWINGS:Graphic and pictorial documents drawn to scale that show the design,location,and dimensions of project elements. EJCDC CONSTRUCTION DOCUMENTS:Sample agreements and contracts prepared by the Engineers'Joint Contract Documents Committee (EJCDC). ENGINEER:See Design Professional. ENGINEER-ARCHITECT:See Design Professional. ENGINEER OF RECORD (EOR):The prime design professional,engineering firm,or organization that is legally responsible for the engineering design. ENVIRONMENTAL ASSESSMENT (EA):A report on the anticipated impact of a proposed project on surrounding conditions.An EA typically includes environmental,engineering,aesthetic,and economic impacts. ENVIRONMENTAL IMPACT STATEMENT (EIS):A detailed document meet- ing the requirements of the National Environmental Policy Act that discusses the benefits and impacts of project alternatives with respect to specified envi- ronmental issues.Some projects may require draft (DEIS)and final (FEIS) versions of this document. FACILITY:The constructed elements of a project. FAST-TRACK CONSTRUCTION:The practice of starting construction and/or site work as soon as drawings and specifications are available for some por- tions of a project,even though design may not be complete for others. GOALS:Broad project aims,usually expressed by the owner.Also see Objectives. INDEMNIFICATION:A collateral contract or assurance in which one party agrees to secure or "hold harmless”another against unanticipated losses or prevent the other party from being damaged by the legal consequences of an act of forbearance by one of the parties or a third party. INSTRUCTION TO BIDDERS:The instructions contained in the bidding doc- uments for preparing and submitting bids for a construction project or des- ignated portion of a project. INVITATION TO BIDDERS:See Advertisement for Bids.(For private own- ers,invitations are sent to pre-qualified contractors.) LIFE-CYCLE COST:The total cost of developing,designing,constructing, owning,operating,and maintaining a constructed project for its design life, 256 including energy,maintenance,and staffing.Life-cycle costs also include decommissioning,salvage (if appropriate),and other non-capital costs. LIQUIDATED DAMAGES:A dollar amount established in a construction con- tract,usually a fixed daily sum,as the measure of damages incurred by the owner due to the failure of the constructor to complete the work as scheduled. LOSS PREVENTION:The use of safety programs and insurance to mitigate financial losses resulting from loss of life and personal injuries and property damage on a construction project. OBJECTIVES:Specific descriptions of the project location,function,size, performance characteristics,schedule needs,financial matters,and other items as established by the owner,often with the assistance of the design profes- sional.Also see Goals. OBSERVATION:A function of a design professional involving required vis- its to a project site during construction to observe the progress and quality of work and determine if it is proceeding according to the contract documents. OFFICE PRACTICE:A standardized program for a design or construction firm that covers general management,the organization of projects,owner rela- tionships,office procedures,filing and storing materials,and operating procedures. OWNER:The individual or organization that initiates a construction.project and is responsible for financing it. PARTNERING:A voluntary effort among project participants to implement processes that enhance communication,reduce conflict,develop common goals,and solve problems in ways that deliver mutual benefits. PLANS:See Drawings. PRE-BID CONFERENCE:A meeting arranged by the owner for prospective constructors prior to the submission of construction bids to introduce the proj- ect,outline its goals and objectives,describe the design professional's intent (the design professional is usually present),and address bidders'questions. PRECONSTRUCTION MEETING:A meeting arranged by the owner after the construction contract has been awarded,but before construction begins, to provide the owner,design professional,constructor,and subcontractors with the opportunity to establish procedures and working relationships for construction operations. PRESENT-WORTH ANALYSIS:An analysis of project cost over a prescribed evaluation period with an emphasis on time-sensitive financial factors,such as inflation and amortization often used to establish life-cycle costs. 257 PROGRAM MANAGER:A person or entity who manages all phases of proj- ect development (conceptual,design,and construction)and reports to the owner. PROJECT:(1)The facilities or elements to be constructed,as defined by con- tract documents;(2)the people and processes that create a completed facility. PROJECT COST:The total capital cost associated with design and construc- tion,including design fees,construction labor and materials,and financing costs for borrowed funds.Project costs do not include operating and mainte- nance expenses.Also see Life-Cycle Cost. PROJECT EVALUATION:A critical evaluation of a project by the project team members during both design and construction to assess design,sched- ule,objectives,costs,legal ramifications,and trends that impact cost,quality, and schedule. PROJECT MANAGEMENT:The planning,organizing,staffing,directing, controlling,and coordination of design and construction activities for a con- structed project. PROJECT MANAGER:The person who heads either the program manage- ment or construction management entity and who has a direct contractual responsibility to the owner. PROJECT PLAN:A work activity diagram and other documents depicting features of a project's objectives. PROJECT SCHEDULE:The chronological order of project events,usually depicted by a diagram,graph,or written listing showing proposed and actual times for the start and completion of tasks. PROJECT TEAM:The people and organizations primarily responsible for completing a constructed project:the owner,design professional,and con- structor (or design-builder). QUALIFICATIONS:The information about an individual or organization sub- mitted during the bidding or design agreement negotiation process in response to predetermined standards and requirements. QUALIFICATIONS-BASED SELECTION (QBS):A process for selecting the design professional or design-builder based on his or her relevant qualifica- tions for the project,rather than the price of his or her services. QUALITY:The delivery of products and services in a manner that meets or exceeds the reasonable requirements and expectations of the owner,design professional,and constructor,including conformance with contract require- ments,prevailing industry standards,and applicable laws and licensing requirements. 258 QUALITY ASSURANCE:Planned and systematic actions focused on pro- viding the members of the project team with confidence that components are designed and constructed in accordance with applicable standards and as spec- ified by contract. QUALITY CONTROL:The review of services provided and completed work, together with management and documentation practices,that are geared to ensure that project services and work meet contractual requirements. REASONABLE CARE:A degree of care,precaution,or diligence as may fairly and properly be expected or required,having regard to the nature of the action, or of the subject matter and the surrounding circumstances of the action. RECORD DOCUMENTS:A compilation of drawings,specifications,addenda, written amendments,change orders,work directive changes,field orders,and written interpretations and clarifications,maintained in good order and anno- tated to show all changes made during construction.These record documents, together with all approved samples and a counterpart of all approved shop drawings,are available to the design professional for reference while the proj- ect is underway and are delivered to the owner upon project completion. RECORDS:Documents that contain project data,activities,transactions,mem- oranda of oral communications,as well as specified electronic files.Records usually include the contract documents. RESIDENT PROJECT REPRESENTATIVE (RPR):The person who represents the owner during construction,managing the day-to-day administration of the construction contract,monitoring progress,and maintaining working rela- tionships among project site personnel. RESPONSIBILITIES:The project objectives as defined and assigned to vari- ous team members by contractual agreement (see 1.3). RESPONSIVE BID:A bid by a qualified bidder that meets the project speci- fications,as stated in the bidding documents. REQUIREMENTS:What a participant expects or needs from participating in a project (see 1.2). RETAINAGE:A sum withheld from progress payments to the design profes- sional or constructor according to terms of owner-designer or owner-con- structor agreements. RISK TRANSFER:Contractual clauses that transfer the risk of project team members to other parties by means of bonds or insurance.Sometimes risk transfer refers to the allocation of risk among members of the project team. SELECTION COMMITTEE:A committee of qualified professionals estab- lished by the owner and guided by pre-established criteria and administrative policy,that makes recommendations on the selection of the design 259 professional or design-builder after conducting investigations,interviews,and inquiries. SHOP DRAWINGS:Drawings,diagrams,schedules,and other data required for manufacture,fabrication,and erection of project components,These can be prepared by the constructor,subcontractor,or manufacturer. SPECIAL CONDITIONS:A section of the Conditions of the Contract,sepa- rate from General Conditions and Supplementary Conditions,that describes relevant unique project conditions. SPECIFICATIONS:A part of the contract documents,usually contained in the project manual,consisting of written requirements for materials,equipment, construction systems,standards and quality of construction tradecraft. START-UP:Preparing the project or facility for occupancy or use,including the testing of systems operation. SUBCONTRACTOR:A person or entity contracting with the constructor, design-builder,or owner (if project delivery is self-provided)to provide equip- ment or construction services. SUBCONSULTANT:A person or entity providing design-related services to the design professional,design-builder,or owner. SUBROGATION:The assumption by a third party of another's legal right to collect a debt or damages. SUBSTANTIAL COMPLETION:The point in the progress of a project at which the work is sufficiently complete,in accordance with the contract doc- uments,so that all or part of the facility can be used as intended. SUPPLEMENTARY CONDITIONS:A part of the contract documents that sup- plements and may also modify,change,add to,or delete from provisions of the General Conditions. SUPPLIER:A person or firm supplying materials or equipment for construc- tion,including materials fabricated for a special design. SUSTAINABLE DEVELOPMENT:Meeting human needs for natural resources,industrial products,energy,food,transportation,shelter,and effec- tive waste management while conserving and protecting environmental qual- ity and the natural resource base essential for future development. TASK MANAGER:An individual who manages a specific assignment of the design. TRADECRAFT:The work performed by construction trade workers,includ- ing carpenters,masons,electricians,ironworkers,equipment operators,and other craftspersons. 260 TRADITIONAL PROJECT DELIVERY:A contractual arrangement or project delivery system,known as design-bid-build,or DBB,that involves three prin- cipal participants:the owner,design professional,and constructor.Also see Design-Bid-Build. TURNKEY:An extension of design-build contracting in which the design- builder carries out most major project responsibilities,including land acqui- sition,financing,purchase and installation of equipment,and other tasks;the design-builder then operates the completed facility for a specified period and then "turns over the keys”to the owner. UNBALANCED BID:A bid in which some of the unit prices do not reflect the true estimated cost of the services or materials being provided;the costs of some unit prices are overstated and others understated. VALUE ENGINEERING:A limited independent engineering exercise with the goal of identifying or verifying engineering alternatives that maximize the relationship of the value of the function,performance,and quality of specific project elements to cost. VENDOR:See Supplier. 261 ACRONYMS AAA American Arbitration Association AASHTO American Association of State Highway and Transportation Officials ACEC American Consulting Engineers Council ACI American Concrete Institute ACM Agency construction manager ADR Alternate dispute resolution AGC Associated General Contractors of America,Inc. AIA American Institute of Architects AISC American Institute of Steel Construction AISI American Iron and Steel Institute ANSI American National Standards Institute APWA American Public Works Association ASCE American Society of Civil Engineers ASFE Association of Engineering Firms Practicing in the Geosciences ASHRAE =American Society of Heating,Refrigeration and Air-conditioning Engineers ASME American Society of Mechanical Engineers ASTM American Society for Testing and Materials AWS American Welding Society AWWA American Water Works Association BMP Best management practices CAD Computer-aided design or computer-aided drafting CCIP Contractor-controlled insurance program CFR Code of Federal Regulations CGL Commercial general liability Cll Construction Industry Institute CM Construction manager CMAA Construction Management Association of America CPM Critical path method CRSI Concrete Reinforcing Steel Institute csi Construction Specifications Institute CVS Certified Value Specialist DBIA Design-Build Institute of America DBB Design-bid-build DBOM Design-build-operate-maintain DBOT Design-build-operate-transfer DBOOT Design-build-own-operate-transfer EA Environmental Assessment 262 EEO EIS EJCDC EPA FAR FAST FHWA FIDIC FTA GMP GSA ICE IEEE LLC LLP NAS NEPA NFPA NIST NPCA NRMCA NSPE OcIP O&M OSHA PCA PCI PDM PTI QA/QC OBS RCRA RFI RFP RFQ RPR SCADA soa USACE VECP Equal Employment Opportunity Environmental Impact Statement Engineers Joint Contract Documents Committee Environmental Protection Agency Federal Acquisition Regulations Function Analysis System Technique Federal Highway Administration International Federation of Consulting Engineers Federal Transit Administration Guaranteed maximum price General Services Administration Institute of Civil Engineers (U.K.) Institute of Electrical and Electronics Engineers,Inc. Limited Liability Corporation Limited Liability Partnership Network Analysis Systems National Environmental Policy Act National Fire Protection Association National Institute of Standards and Technology (formerly NBS) National Precast Concrete Association National Ready-Mix Concrete Association National Society of Professional Engineers Owner-controlled insurance program Operations and maintenance Occupational Safety and Health Administration Portland Cement Association Prestressed/Precast Concrete Institute Precedence diagramming method Post-Tensioning Institute Quality Assurance/Quality Control Qualifications-based selection Resource Conservation and Recovery Act RequestforInformation Request for Proposals Request for Qualifications Resident Project Representative Supervisory control and data acquisition Statement of qualifications United States Army Corps of Engineers Value engineering change proposal 263 INDEX Acceptance standards,164,165 Accounting,96,194 ACEC,125,133,210 Advisers,to the owner,26;to the design professional,29,82;to the constructor,121 AGC,124-125,133,210;standard form contracts of,63,133 Agency construction manager,18 Agreements.See contracts,standard-form agreements Agreement for Professional Services,elements of,54 AIA,20;standard form documents of,59,63,64 Alternatives studies,67,69-74 ANSI,165 ASTM,165 Architectural engineering projects,88,90 ASCE Manual 45,44 ASCE Policy Statement 350,"Construction Site Safety,”27,139, 144,166 ASFE,210 Associate consultants,26,82 Best value contracting,128 Bid evaluation,127 Bid opening,127 Bid solicitation,126 Bidding,48-49,125-128 Bonds,22,219-220 Bonus clauses,170 Brooks Act,44 Budget planning,10,84,142 Cash flow requirements,142,153,173 Certificates of completion,175 Change orders,171-172 Close-out,35,144-145;for design,81 CMAA,18,62 Codes and standards,98-99,102-103 Communication,critical points in,40-41;during design,83-84; forms of,37-38 Competitive bidding,48-49,125-128 Computer applications,general use,193-194;for the owner,195; for the design professional,196-198;for the constructor, 198-200 Computer-aided design (CAD),97,196 Conceptual design,69-75,241 Conceptual planning,67-68;framework for,69;selecting alter- natives,70-74 Conflict avoidance,41-42,220-221 Conflict resolution,31,221-222 264 Conflicts,41-42,220-221 Connections,155 Contractor.See constructor Constructability reviews,101-102 Construction contract documents,2,3,104,131,132-133 Construction contract,arrangements for,113;elements of,132; international,133-134;standard form,132-133.Also see contracts Construction contract submittals,149,151,154-161 Construction costs,100-101,142 Construction documents,132-133,190 Construction facilities,143 Construction phase,design professional's role,93 Construction management,18-19;standard-form contracts for, 62 Construction manager,agency,18,62 Construction manager-at-risk,19 Construction site safety,139,144 Construction supervisor or superintendent,26,33,119 Construction support services,119 Construction team,assembling,115-116;typical DBB organi- zation,117 Constructor,qualifications of,123-125;QA/QC programs of, 189-191;requirements of,2;responsibilities of,3,30,152 Consulting Engineering:A Guide for the Engagement of Engineering Services (ASCE Manual No.45),44 Contract award,127-128 Contract documentation,149,151,153-154 Contracts,negotiated (QBS process),44-48;short-form agree- ments,60;standard-form agreements,59.Also see agree- ment for professional services Coordination,34-36;during design,83-84;during construction, 145-146 Coordination processes,34 Cost-plus contracts,169 Design-bid-build (DBB)project delivery,1-2,15,17-18 DBIA,19;standard-form contracts of,63 Design,computer applications,97,196-198 Design activities and responsibilities,98-102 Design-build project delivery,19-20;organization for,89-91, variations on,21-22 Design considerations,99-100 Design costs,84,92 Design delegation,87-88,157 Design engineering project,88-89 Design guidelines,83 eaDesign phases,79-81 Design plan,81-82 Design professional,compensation for services,57;during con- struction,93;insurance needs of,218-219;qualifications, 46-47;QA/QC program,186-189;requirements of,2; responsibilities of,3,29-30;selection of,43-50 Design quality,80-82,186-189 Design responsibility,98-102 Design reviews,100,188 Design-construct.See design-build Design team,26,29-30,81-83,87-88;considerations of,91-92 Design team leader,81-82,87 Developer-financed projects,22 Documentation,153-154,172.Also see record drawings Drafting practices,97-98,196-197.Also see computer-aided draft- ing (CAD) EJCDC,55 EJCDC documents,55-56,58-64,206 E-mail,38,194 Engineering project,88-89 Environmental justice,76 Environmental permitting,76;assessments and impact statements, 75-77 Estimating,142,198 Equipment,shop drawings for,156 FAST,246-248.Also see value engineering Fast-track construction,23 Fatal flaw screening,71 FIDIC,134 Field organization for construction,137,143-144 Final design,74-75 Financial resources (funding),3,9,108 Financial risk,16,214,218-220 First aid,144.Also see construction site safety Forms and agreements,for construction contract,133-134,for design professional agreement for services,55,59;for con- struction management,62;for design-build,63,for subcon- sultants,61;for joint venture,64 Goals,4,9,10 Government agencies.See regulatory agencies Human resources,96,110 Incentive clauses.See bonus clauses Insurance,needs of owner,218;of design professional,218-219, of constructor,219.Also see risk management Internet,200-201 Interviews,for peer review,208 Job-cost reporting,174 Job records,174-175 Job site safety,27,144 Joint venture,standard-form agreements for,64 Liability,200.Also see risk Life-cycle cost,43,99 Liquidated damages,169-170 Litigation,222 Lump sum contracts,168 Manufacturing capability,110 Materials,164;management of,164;substitutions,164-165 Mechanical and electrical components,shop drawings for,156 Meetings,39 Minimum acceptable standards,164-165 Multidiscipline projects,87,88-91 Multi-prime agreements,61-62 Negotiation,for professional services agreement,47-48 NEPA,76 Network scheduling logic,173-174 No-build alternative,69,72 NSPE,133 Objectives,4-5,9,10-11 Office operation,of the design professional,95-97 Operating phase,182 Operation and maintenance,177-183,planning for during design, 178-179;during construction,179-180 Ordinal ranking,74-75 Organizational levels,89-90 Organizational peer review,204,207 Owner,activities of,27;insurance needs of,218;public,12;pri- vate,11;requirements of,2;responsibilities of,3;role of, 9-10;team members of,26 Owner's project manager,28-29 Owner's resident project representative (RPR),163-64,166-168, 170-172,174-175 Owner's selection committee,45 Owner's team,26 Partnering,225-237;agreements (charter),232;benefits of, 225-228;principles of,228-229;misperceptions about,229; sessions,231-233;special applications of,234-235 Payment,for professional services,57;for construction,166-169 Peer reviewers,207-208 Peer reviews,203-211;benefits of,204-204;elements of, 206-210;reports,209;request for scope of,206-207;types of,204-206 Peer review programs and resources,210 Permits,75-76 Placing drawings,for concrete reinforcing steel,158-159 Pre-bid conference,126-127 Pre-construction meetings,140-141 Preliminary design,71 Private construction projects,competitive bidding for,128 Private owners,11 Professional disciplines,96 Program manager,28-29 Progress reports,172-173 Project construction,141;organization for,143 Project management,peer reviews,203,205-206 Project manager,26,28-29 Project peer reviews for design,203,207 Project development phases,69,70-75 265 Project team,1-3;composition of,25-26 Project objectives,4,9,35 Public involvement,77 Public owners,12;bidding for public works,125-128 Public works projects,competitive bidding for,125-128 QA/QC,185-191;owner's role in,185-186;design profes- sional's process,186-189;constructor's process,189-191 QBS,44-48 Quality (definition),4 Quality assurance,185 Quality control,185;owner's role,185-186;design professional's program,100,186-189;constructor's process,189-191 Quantity takeoff,198 Record drawings,174-175 Records,174-175.Also see documents Recycling,143 Regulatory agencies,111,120 Reinforcing steel components,158-159 Reports,172-173;of peer reviews,209 Requirements,4,9;of the owner,2,10;of the design profes- sional,2;of the constructor,2 Resident project representative (RPR),163-164,166-175; responsibilities,163 Responsibilities,of the owner,3,9,137-138;of the design pro- fessional,3,29,138;of the constructor 30,139,152 Retainage,169 RFP,46-47 RFQ,46 Risks,managing,214-215,218-220;reduction strategies,226; equitable allocation of,218 Safety,on construction site,166;responsibility for delegating, 27,166 Schedules,for alternative development,72;for construction, 141-142,153-154;for design,84 Schematic design phase,QA/QC program for,187;VE during, 242 Selection committee,for quality-based selection,44-46 Self-provided project delivery,16 Shop drawings,for structural components,155;for manufactured structural components,156;for mechanical and electrical components,156;for temporary construction,157;log for, 174-175 266 Short-form agreements,60 Standard-form agreements,between the owner and design pro- fessional,55,59;with subconsultants,61;for multi-prime design services,61;for construction management,62;for design-build,63;for joint venture,64 Start-up phase,for design,79;for construction,180-183 Statement of qualifications,for design professional,46;for con- structor,124-125 Structural components,shop drawings for,155-156 Subcontractors,26,120-121,139 Subconsultant,26,29-30;agreements for,61;associate consult- ants,82 Submittals,154-161 Suppliers,110,120 Sustainable development,71,100 Take-off,142,198 Team members,1,5,6,26,31,33;relationships among,34-35. Also see project team Technical submittals,154 Temporary construction,shop drawings for,157.Also see design discipline delegation Testing,materials,159,164-166 Tradecraft,166 Turnkey,21-22 Two-envelope selection,49 Unit costs,142 Unit-price contracts,167-168 Value engineering,239-251;concept of,139;benefits of, 239-240;timing of,240;stages of,244-249 Warranties,220 Waste management,143.Also see sustainable development Work force management,143-144 Workmanship.See tradecraft