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February 2005 February 2005 IN THIS ISSUE IN THIS ISSUE The AACE International Journal of Cost Estimation, Cost/Schedule Control, and Project Management Technical Article - The Effect of Early Freezing of Scope on Project Schedule Technical Article - The Case of US Projects in Europe - Guidelines to Mitigate Schedule Delay, from the Owner’s Viewpoint Technical Article - Construction Baseline Schedule Review and Submittal Timeframe Special Series - Surviving the Perfect Storm Executive Article - Avoiding Successful Lawsuits by Non- Performing Employees Special Feature - Primavera Launches New Synchronization Software for Contractors and Subcontractors Technical Article - The Effect of Early Freezing of Scope on Project Schedule Technical Article - The Case of US Projects in Europe - Guidelines to Mitigate Schedule Delay, from the Owner’s Viewpoint Technical Article - Construction Baseline Schedule Review and Submittal Timeframe Special Series - Surviving the Perfect Storm Executive Article - Avoiding Successful Lawsuits by Non- Performing Employees Special Feature - Primavera Launches New Synchronization Software for Contractors and Subcontractors The Association for the Advancement of Cost Engineering International Promoting the Planning and Management of Cost and Schedules Promoting the Planning and Management of Cost and Schedules Visit our website at www.aacei.org Cost Engineering Focus: Planning and Scheduling Cost Engineering Focus: Planning and Scheduling Puenta de la Unidad (Bridge of Unity) Monterey, Mexico Wacker Drive Replacement Chicago, IL Pierce Transit Tacoma Dome Station Development Tacoma, WA Preheater Tower Florence, CO Knowlton Hall Columbus, OH

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February 2005February 2005

IN THIS ISSUEIN THIS ISSUE

The AACE International Journal ofCost Estimation, Cost/Schedule Control, and Project Management

• Technical Article -The Effect of EarlyFreezing of Scope onProject Schedule

• Technical Article -The Case of USProjects in Europe -Guidelines to MitigateSchedule Delay, fromthe Owner’s Viewpoint

• Technical Article -Construction BaselineSchedule Review andSubmittal Timeframe

• Special Series -Surviving the PerfectStorm

• Executive Article -Avoiding SuccessfulLawsuits by Non-Performing Employees

• Special Feature -Primavera LaunchesNew SynchronizationSoftware forContractors andSubcontractors

• Technical Article -The Effect of EarlyFreezing of Scope onProject Schedule

• Technical Article -The Case of USProjects in Europe -Guidelines to MitigateSchedule Delay, fromthe Owner’s Viewpoint

• Technical Article -Construction BaselineSchedule Review andSubmittal Timeframe

• Special Series -Surviving the PerfectStorm

• Executive Article -Avoiding SuccessfulLawsuits by Non-Performing Employees

• Special Feature -Primavera LaunchesNew SynchronizationSoftware forContractors andSubcontractors

The Association for the Advancement ofCost Engineering International

Promoting the Planning andManagement of

Cost and Schedules

Promoting the Planning andManagement of

Cost and Schedules

Visit our website at www.aacei.org

Cost Engineering Focus:

Planning andScheduling

Cost Engineering Focus:

Planning andScheduling

Puenta de la Unidad (Bridge of Unity)Monterey, Mexico

Wacker Drive ReplacementChicago, IL

Pierce Transit Tacoma Dome Station DevelopmentTacoma, WA

Preheater TowerFlorence, CO

Knowlton HallColumbus, OH

S chedule delays and cost overrunsare a matter of concern for theowner, as well as for the contractor.

The problems refer to project deliverymethods, with special attention to interna-tional projects and bidding strategies.Managing projects overseas, in an interna-tional environment, requires a differentapproach to tender and select the contrac-tor. Surely, it's necessary to break from thelow-bid paradigm [5] and promote insteada criteria based on a best-value bid.

This study is based on the field experi-ences of the author. Since 1997, the authorhas worked as a project control consultanton behalf of general contractors, on manyprojects regarding the construction of USNavy civil facilities in Italy, at the bases ofAviano (Pordenone, Northern Italy) andCapodichino (Naples), Southern Italy.

The author, with his group of plannersand schedulers, worked on over 15 build-ings, including administration buildings,air passenger terminals, schools, and othertypical civil facilities.

The analysis presented in this articleproceeds through three steps—a descrip-tion of problems, analysis of the causes,and a presentation of recommendedactions.

ANALYSIS

Description of the problems

The Projects EnvironmentThe projects are generally assigned on

the basis of a design-bid-build scheme(DBB) [7]. The owner’s construction man-agement team is located on the project site.The management role is undertaken byresidence officer in charge of construction(ROICC). Generally, the design firm islocated in the US and sometimes a part-nering local engineering firm is engaged toprovide local engineering support. This ismostly targeted to submittal analysis and/ortechnical change evaluations. Contractorsare generally selected on the basis of a low-bid process.

The ROICC is the sole entity manag-ing on behalf of the owner and directlyinterfacing with contractor organizations.The project environment is international,with participants coming from differentcountries. Attention has to be given tomaintaining good relationships betweenthose involved as there are different cultur-al, religious, and professional educationalbackgrounds included in the mix.

Structure and Role of the ContractThe role of the main contract is criti-

cal, as it rules and governs the entire proj-ect management process. Through coordi-nation procedures, one needs to addressand regulate the communication betweenthe contractor and the owner. These proce-dures can include the following.

• a submittals procedure for a materialand equipment procurement process;

• quality assurance and quality control;• a progress payment procedure; and• planning and scheduling, including

schedule delay analysis and changeorder management.

The planning and scheduling contractspecifications (P&S-CS), Section 01321 ofthe main contract, form the base on whichthe project control system stands. Theseaddress the entire planning and schedulingprocess and project progress monitoring.

In looking at planning and schedulingand project progress monitoring, considerthe following items.

• a baseline schedule development andapproval;

• a periodic schedule update (on a bi-weekly and monthly basis);

• reporting;• a schedule delay analysis procedure.

The Network Analysis System (NAS) isbased on the critical path method(CPM) methodology, by using thepredecessor diagram method (PDM)technique [1]. The schedule delay isnumerically expressed by the negativetotal float on the current scheduleupdate. The schedule control andproject progress monitoring is madeon the basis of current schedule versusbaseline schedule, showing currentearly/late dates versus target early/latedates.; and

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 21

TECHNICAL ARTICLE

Guidelines to Mitigate ScheduleDelay, from the Owner’s Viewpoint

ABSTRACT: This study analyses the problem of schedule delay on US government constructionprojects in Italy. Similar problems, regarding US construction projects in Europe, have beenreported in literature [5]. This analysis was undertaken from the owner’s point of view. The pur-pose of this article is to identify corrective actions that could be implemented by the owner.

Experience shows that many projects suffer schedule delay and that this delay mostlyoccurs during the "initial phase" of the projects, covering a period from five to seven monthsfrom contract award. For a typical construction project of a new facility, the "initial phase" ofproject start up (preliminary activities) includes the structural system erection (foundations,structures erection, slabs). Schedule delay can also accumulate at the end of the structuralerection. This can become a great portion of the final project schedule delay. Difficulties inmaintaining the schedule from the early stages of project development create the basis for futureproblems that will also cause further schedule delay. The contractor is then called upon toprepare aggressive recovery schedules. These have a high probability to fail for a combinationof factors,that will be discussed in this article.

This study analyzes factors causing schedule delays and suggests guidelines that, in theopinion of the author, could mitigate the problems of schedule delays and improve the controlof schedules for similar US government projects in Europe.

The guidelines are based on a key concept of a different role for the owner who becomesan agent of project management development. The owner then drives the contractor to makestrategic choices at the earliest stage of project development. This is done by driving thecontractor to implement effective methodologies and techniques of project planning andcontrol. These actions require a different approach to bidding strategy. Although this article hasbeen developed on specific cases of US government project in Europe, many considerationshave a general application for project management.

KEY WORDS: Contracts, critical path, schedule delay

Massimoluigi Casinelli, PE CCE

The Case of US Projects in Europe

22 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

Certificate of Insurance 0Issue Certificate of Insurance 0Surety Bonds 0Issue Surety Bonds 002468 - Drilled Found. Plan: Requirement 01.4.2 - Pile Installation Plan: Submit. Prep. 01.4.4 - Survey of Pile Locations: Submit. Prep. 02.1.1.3 - Reinforcing Steel: Submittal Prep. 002468 - Drilled Foundation Plan: approv. gover. 002468 - Drilled Foundation Plan: 0

Purchase./Delivery Process03300 - Cast in Place Concrete: requirement 41.6.2.1 - Formwork: sub. prep. 41.6.2.2 - Reinforcing Steel: Submittal Prep. 41.6.4.1 - Concrete Mix Design: Subm. Prepar. 42.1.3 - Joint Sealants: Subm. Prepar. 42.1.11 - Welded Wire Fabric: Subm. Prep. 42.1.12 - Polypropylene Forms: Subm. Prep. 42.4.1.2 - Mix Design: Subm. Prep. 42.5.1.1 - Fly Ash: Submittal Preparation 42.5.10 - Joint Sealants: Subm. Prep. 403300 - Cast in Place Concrete: approval 401330 - Submittal Register: preparation 5Hazardous removal material: subcontr. 503300 - Cast in Place Concrete: Pur./Del. P. 502315 - Excavation & Fill: Requirement 502315 - Excavation & Fill: Submittal 502315 - Excavation & Fil: Approval by 501321N - Network Analysis Schedule: final 602315 - Excavation & Fill: Mobilization 6Excavation Plan: preparation 8Excavation Plan: approval 8Health & Safety plan: preparation 8Health & Safety plan: approval 801450 - Quality Control Plan Preparation 801450 - Quality Control Plan Approval 801321N - Network Analysis Schedule: review 801572 - Waste Management Plan: approval 9Schedule of Value: approval 9Work Plan: approval 9Environmental Protection Plan: approval 9Temporary site facilities plan: approval 901572 - Waste Management Plan: preparation 10Schedule of Value: preparation 10Work Plan: preparation 10

Environmental Protection Plan: preparation 10Asbestos Hazard Abatement Plan: Approval 10Temporary site facilities plan: preparation 10Asbestos Hazard Abatement Plan: Preparation 1101321N - Network Analysis Schedule: 1201330 - Submittal Register: approval 13List of Proposed Subcontractors: approval 14List of Proposed Product: approval 14List of Proposed Subcontractors: preparation 15List of Proposed Product: preparation 15Demolition Plan: approval 15Demotion Plan: Preparation 16Erosion and Sediment Control Plan: approval 20Erosion and Sediment Control Plan: submittal 21Pre-construction conference 30Preliminary Construction activitiesCommissioning Scope Meeting 0Temporary External Sewerage Line 4Temporary External Water Line 4Temporary Electrical Line 4Temporary Grounding System 4Notification & Communication ISPESEL 4Tower Crane: Excavation Foundation 4Tower Crane: Concrete Foundation 4Tower Crane: Assembly 4Tower Crane: Electrical Connection 4Tower Crane: Grounding Connection 4Tower Crane: Notification ASL 4Pre construction completion: START 4Asbestos Removal 7Asbestos Free Area Certification (ASL) 7Remove Pavement and Concrete Paver 7Remove Underground Utilities 7Staking Building 8Connections with Site Office 8UP TO GRADE LEVELStructural WorksInstallation Pilot Test Pile 0Excavation 4Geo-radar Investigation 8COMMISSIONING & TEST RUNMechanical WorksSubmit TABS Agency qualification 22Agency approval 22

Activity TotalDescription Float

Activity TotalDescription Float

New Facility ProjectProject Start UpPreliminary Administrative Activities

Table 1— List of Project Start Up Activities

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 23

• a time impact analysis (TIA) proce-dure for dealing with change analysisand evaluation.

Although the P&S-CS are designed onthe owner's needs, they also can supportthe contractor's project control and con-tract management.

The critical point in developing jointsupport is the capacity of the contractor tounderstand the above implications and thepotential advantages. In any case, the roleof P&S-CS is critical. Effective specifica-tions, tailored to the specific project's com-plexity, are a major issue that the ownershould address [7].

Analysis of Schedule Delay and Effectson Project Environment

Experience gained on prior projectshas shown that many of these projects suf-fered from serious schedule delays. In somecases, difficulties in executing a project at arequired rate of progress caused seriousfinancial problems and the contractorended up in bankruptcy [5].

In these cases, schedule delay tends toextend over a period of several months. Anew tender process must be undertaken.The owner suffers double cost from re-pro-curement and from costs associated with alate delivery of the facility.

In summary, the problems observedinclude the following.

• Projects progress at a slow rate, espe-cially during the initial phase of thefirst five to seven months after the proj-ect award.

• A schedule delay occurs and growsduring the initial phase.

• The tentative recovery schedulesdeveloped by the contractor are des-tined to fail and to create the basis offurther schedule delays.

• Lack of control on the projects causedby the absence of a realistic scheduledescribing the actual situation; poorcommunication between the contrac-tor and the owner because of theabsence of a common reference and acommon language.

Experience has showed that scheduledelays mostly occur during the initialphase, relevant to project start up andstructural system erection. The contractoris called upon by the owner to prepare anddevelop recovery schedules from the early

stage of the project. Unfortunately, theseschedules are destined to failure, leading toa deterioration of relationships among theparties. Also, tentative recovery schedulescreate a basis of future schedule delays.

The Sequences of Works: Hard VersusSoft Logic

Typical activities of the initial phaseare:

• the preparation and issuing of key pre-liminary documents (quality control,safety plans, etc.)

• the preparation and issuing of criticalsubmittals affecting the start of theworks;

• the execution of the preliminary con-struction works (removing of haz-ardous material, site preparation,underground external utilities, etc.);

• construction of the structural systems:excavations, foundations, steel / rein-forced concrete erection, slabs (up tograde level or the first floor slab).

A detailed list of the project start upactivities is given in table1, and is orderedby total float.

The structural system erection endswith the building being closed up. This isachieved when the building’s roofing workis completed. This milestone is critical forthe further development of the works as itallows work inside the buildings to start.This work will include installation of serv-ices such as, fire protection, air ventilationand conditioning (HVAC); fire alarm,power and lighting, anti-intrusion, interiorfinishes, etc.

This described sequence is the idealpath of the construction works, on which atypical baseline schedule is developed. Theactivities for preliminary construction andstructural system erection are characterizedby sequences of works requiring the use ofhard logic for the development of the CPMschedule [3]. The tight sequence of theconstruction works, the fixed duration ofthe activities (constrained in a small rangeof well known productivity), and the needfor dead-time concrete curing, make it dif-ficult to recover the schedule delay duringthis stage of project development.

Experience has confirmed that thedelay accumulated during the constructionof the structural system of the building isdestined to remain, in large portion, un-recovered. Hard logic obligates one to

develop tentative recovery schedules basedon the overlapping of future activities.These include mechanical and electricalinstallation, and interior finishes that arecharacterized by a soft logic [3].

The effect of this practice (that shouldnot be encouraged by the owner) is toremand to the future the solution of cur-rent schedule delay. This creates the basisfor further schedule delays in the nextstages of project execution. This is becauseof the impracticability of the developedplans. In fact, the overlapping of futureactivities leads to other negative effects,including the following.

• the works scheduled require morelabor force than what was originallyplanned. The subcontractor is calledupon to increase staffing and/or planto work overtime;

• the overlapping causes congestion inthe work areas;

• a great coordination effort is demand-ed of the project staff of the main con-tractor;

• litigation grows among subcontractorsand between subcontractors and themain contractor;

• the main contractor is pushed to devel-op even more aggressive schedules thatincrease the problems; and

• the above factors are detrimental toproductivity and adjustment factorsshould be considered to estimate theduration of activities [4].

The tentative recovery schedules havea high probability to fail and there is a riskof aggravating the situation. The projectcould remain without a realistic scheduleand the relationships between the ownerand the contractor risks ruin. Although theowner has the right to ask the contractor toprepare a recovery schedule, and the con-tractor has the right to have this chance, it'sevident that another approach should beinvestigated by analyzing the causes of thedifficulties to start up the project.

The Causes of Schedule DelayThe contract demands a fast imple-

mentation of the project managementprocess, especially in regard to the submit-tals approval process. Many preliminaryactivities stand on the critical and sub-criti-cal path (total float value between 0-10days). The typical critical and sub-criticalpaths of construction of a new facility are

24 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

limited to the first 6-8 months, and areshown in figure 1.

The real causes of schedule delay dur-ing the initial phase are related to the diffi-culties of the contractors to properly set upan organization tailored to the contract'srequirements and to implement the rightprocess of project management. This isbecause of the following critical factors.

• poor knowledge of the project (scope,technical specifications, project envi-ronment);

• poor knowledge of the contract'srequirements;

• poor experience on similar projects;• a lack of managerial skills and project

management culture, both at the man-agement level and at the project level;and

• inadequate financial capacity.The effects caused by the above factors

will now be further described, by correlat-ing the impacts on specific activities caus-ing delay and/or a lack of schedule control.

Late Mobilization of Contractor• Set up of project organization.• Selection and mobilization of key sub-

contractors.

Effects on Critical Issues/Activities• late issue of key documents (a safety

plan, excavation plan, and a hazardousmaterial removal plan);

• late issuing of critical electrical /mechanical submittals;

• an absence of efforts by key subcon-tractors in the planning phase; and

• late issuance of a baseline controlschedule or preparation of the baselineschedule without the contribution andconsensus of major subcontractors.

Figure 1— Critical and Sub Critical Path (Limited to the First Six Months)

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 25

Poor Knowledge of the Contract'sRequirements• Undervaluation and misunderstand-

ings of the procurement process, andcoordination of the communicationprocedures, misunderstandings oftechnical specifications.

Effects on Critical Issues/Activities• a bad cost/labor estimate;• a wrong estimate on procurement of

long time items;• under evaluation of the needs of sub-

contractors coordination.

Poor Project Management Culture• Poor project planning and control:

scope definition, estimating, planningand scheduling methodologies.

Effects on Critical Issues/Activities• wrong approach in the process of

schedule control;• abuse and/or wrong use of CPM

scheduling methodology; and• wrong implementation of planning

and scheduling contract specificationsNAS (networking analysis systems).

Inadequate Financial Capacity• difficulties staffing the project with the

right skills; and• difficulties funding the project; a

financial incapacity to sustain initialcash flow obstructs the contractor inthe early procurement of materials andequipment.

Recommendations Proposed / Key ConceptsControl of the project construction

phase, from the owner’s point of view, startsduring the tender phase. The goal is to leadthe contractor to an early set up of the proj-ect organization and to the most effectiveproject planning. The solutions proposed(in the form of guidelines) are based onthree sets of corrective actions, that can beimplemented independently; all of themrequire a more active role of the owner whobecomes the real engine for the develop-ment of the project management.

Action 1The contractor should be driven and

supported in order to anticipate some criti-cal choices regarding the project organiza-tion at the time of bidding preparation andto implement the best practices and tech-

niques of project scope definition and plan-ning.

Action 2Improve the planning and scheduling

activity of the contractor during the execu-tion of the works.

Action 3Adopt two types of contracts—reim-

bursable for the project management staffof the contractor (indirect cost) and lumpsum, fixed-price, for construction works(direct costs).

Actions 1 and 2 must be translated inspecific contract's obligations, respectivelythrough instruction to bidders and throughthe integration of the P&S-CS. Action 3could be limited to the most critical andimportant projects.

Practical GuidelinesAction 1—Organization and Planning

This action has two goals:

• forcing the prospective contractor tothe earliest project planning (pre-plan-ning) [1 and 6]; and

• giving evidence of the clear under-standings of scope of work and of thecontract's requirements [3].

Practical Guidelines• Project key personnel presented by the

contractor must include the certifiedengineers/architects in charge of thesubmittals preparation; even and espe-cially if these activities shall be under-taken by the subcontractors, as this is awidespread practice.

• Selection of subcontractors: key sub-contractors must be selected by thecontractor during the bid time anddeclared in the offer. This is criticalbecause the project startup requiresthe early mobilization of specific sub-contractors, as well as early submittals.

• The bid's project schedule must betied to the baseline project schedulethrough the front end schedule. Thisrequires that the owner imposes a bidschedule, including a detailed front-end schedule, covering the initialphase of 90-120 days after contractaward. This must be used as a basis todevelop the project baseline schedule.The front-end schedule must containall critical preliminary activities.

• The owner should impose the use of aWBS (work break down structure) andof a CBS (cost break down structure),in order to get full integration amongthe bid's cost estimate, the projectbudget, and the structure of projectplanning and scheduling.

• The owner should develop a basicWBS—contractual WBS (CWBS).The contractor should be asked todevelop further details (i.e., the furtherlevels of WBS). This can drive the con-tactor to give evidence of an under-standing of the scope of work.

• Create a temporary engineering taskforce. This should be based on site, ata location provided by the owner tofacilitate the early submittal process.This will facilitate contractor mobi-lization to get the earliest approval ofcritical key documents (quality controlplan, submittal register, baselineschedule, safety plan, foundations andshop DWGs. etc.) and key submittals(concrete mix design, undergroundutilities, piping, etc.). The use of aweb-based project control systemwould facilitate the communicationamong the parties.

• The bidder should address all theabove issues in the project plan.Specific details regarding the contentand format of this key documentshould be included in the instructionto bidders.

Action 2—Improving Planning andScheduling Specifications

This action has two goals:

• Facilitating and driving the contractorto undertake effective project planning(figure 2) at an early stage and the bestdevelopment of the baseline projectschedule; and

• Improving schedule control withemphasis on the process of scheduleupdate.

Practical Guidelines• Create a contractual WBS (CWBS) in

order to facilitate a common frame-work among different projects withinan owner's portfolio. Drive the con-tractor to set up an effective structureto a multilevel schedule.

• Create a multilevel schedule: masterschedule, summary, and detail sched-ule.

26 Cost Engineering Vol. 47/No. 2 FEBRUARY 2005

• Schedule control: the process shouldbe improved in regard to the proce-dures for schedule updating.

Action 3—Different ContractArrangement

This action has the goal to guaranteethat the contractor selects skill resourcesand sets up a project management team fit-ting the project's needs.

The analysis presented in this articlehas pointed out the importance of the con-tactor's capability and competence. A dif-ferent bid strategy, based on the scheme ofbest value of the offer rather than based onthe paradigm of low-bid, should surelyfacilitate the delivering on time of the mostimportant projects. A different and inter-mediate solution to be explored, could bebased on two different arrangements of thecontract for the same project.

• Reimbursable for the project staff ofthe contractor; and

• Lump-sum for the construction works.

This solution would lead to two mainadvantages:• To allow the owner to verify and con-

trol. After the bidding stage, the staffcontractor mobilizes to manage theproject. Letting the owner know thatthe selected personnel have the rightskills and competencies to do thework.

• To guarantee the early set up of projectorganization, this is critical to properstart up the project.

Summary of Key ConceptsThe absence of a structured and com-

prehensive project planning procedurefrom the early stage of a project (front-endplanning) can lead the contractor to under-value both the scope of works and the con-tract requirements. A lack of project skills,poor knowledge of project managementmethodologies and practices are limits tobetter performances.

To facilitate project start up, so criticalfor success, the owner should force anddrive the contractor to make some criticalchoices during the study and preparation ofthe bid.

The owner should integrate his role,becoming an agent of project managementdevelopment. The can be accomplished byplaying a more active role, targeted at pro-viding methodological support to the con-

tractor. The final goal is to drive the con-tractor to early project planning, providingguidance and means for the most effectiveimplementation of project managementmethodologies [6].

Three sets of actions have been pro-posed regarding the bid stage and the proj-ect execution stage respectively.

• Driving and supporting the contractorto do early project planning, by forcingmanagement to anticipate some criti-cal choices at the bidding stage.

• Improving the planning and schedul-ing of contractual specifications.

• Arranging two types of contracts formajor projects: reimbursable for thecontractors project staff and lump sumfor the construction works.

The proposed guidelines requiretranslation into the contract's language.The instructions to bidders and P&S-CSare the tools to implement the recom-mended actions.

Final ConsiderationsA few wrong managerial choices may

generate many negative impacts (Pareto’slaw), detrimental for the success of theproject.

The critical factors, as described in thisarticle, lead to a general under valuation ofproject’s needs. Consequently, the organi-zation set up by the contractor may beinadequate, both in terms of people and/orskills mobilized.

Organizational set up requires earlymobilization of key subcontractors. Theywill be in charge of handling all submittalsfrom their specific disciplines— (structuralsystem, mechanical, electrical, and civil

interior finishes). The paradox is that afterexperiencing troubles and being pushed bythe owner, the contractor finally realizesthe need to properly staff the project team.Regrettably, this generally happens at toolate a stage for project success.

The situations described may happenat different levels of awareness of the con-tractor's top management, depending onthe culture of the firm and its experienceon similar projects. Regardless of the gradeof awareness of the contractor's top man-agement—the effects of the above factorson a project are often disastrous.

In many cases, the author has observeda real and honest effort by the contractor toproperly plan and organize the works.However, failure was because of a lack ofproject management practices.

In other cases, the project was awardedon the basis of an unrealistic cost estimateand the project manager was forced by topmanagement to perform the work with lim-ited resources, inadequate to the projectobjectives. In this case, the contractor mayneed to be terminated. In other cases, theproject staff had the right skills and experi-ence, but top management and projectmanagers imposed the wrong strategicchoices. ◆

REFERENCES

1. AACE International’s CertificationStudy Guide (2nd ed. Revised: 2002)(chapter six: Productivity Adjustment)(chapter eleven: Planning andScheduling)

2. AACE International’s ProfessionalPractice Guide to Project DeliveryMethods. Douglas D. Gransberg, PECCE, and Keith Molenaar. (2001).

Figure 2— Project Planning Process

Cost Engineering Vol. 47/No. 2 FEBRUARY 2005 27

3. AACE International’s Skills and knowledge of CostEngineering 4th Ed. Chapter 9 Scheduling Techniques,(2002): page 9-2 and 9-3).

4. Ballast, Leaf A., PE, and Dr. Calin M. Popescu. SelectingPlanning and Scheduling Specifications. AACE InternationalTransactions, 2001.

5. Gransberg, Dr. Douglas D., PE, and Michael A. Ellicott, PE.Best Value Contracting: Breaking the Low-Bid Paradigm.AACE International Transactions, (1996).

6. Rahbar, Dr. Faramarz Fred and Dr. James E. Rowings Jr., PECCE. Top-Down Back-To-Front Project Planning. AACEInternational Transactions (1998).

7. Tenah, Dr. Kwaku A. Project Delivery Systems forConstruction: An Overview; Cost Engineering 43, No. 1(January 2001).

ABOUT THE AUTHOR

Massimoluigi Casinelli is an Italian citizen living and work-ing in Italy. He is a project management consultant with CasinelliAssociates. He can be contacted by sending e-mail to:[email protected].