organizing for project success

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The purpose of this publication is to make available to

industry the results of research conducted by the

Construction Industry Institute (CII). The publication does

not necessarily represent the view of CII member compa-

nies, but is offered as a contribution to the industry.

CII was founded in 1983 to improve the cost effective-

ness of the nations largest industry. The members, who

represent a broad cross-section of owners and contractors,

believe that many of the problems that limit cost effective-

ness are common ones, and that real improvements can be

best accomplished in a cooperative environment with the

benefits being shared by the construction industry at large.

CII uses the acronym TOPICS to describe the research

effort. TOPICS signifies the six research thrust areas:

Technology, Organization, People, Information, Controls

and Sigma (meaning others). The task forces for each area

are listed below.

Technology

Advanced Technological Systems

Computer Integrated Design & Construction

Constructability

Electronic Data Management

EPC Flexibility

Modularization

Technology

Organizat ion

Constructabililty Implementation

Partnering

Project Organization

Project Team Building

Project Team Risk/Reward Allocation

People

Construction Work Force

Education and Training

Employee Effectiveness

Safety

Zero Accidents

I n fo rmat ion

CICE Impact Evaluation

Industry Data & Statistics

International Construction

Model Plant

Owner Engineering Organization

Project Management Assessment Survey

Controls

ASCE Quality Manual

Change Order Impacts

Claims

Contracts

Contracts, Phase II

Cost/Schedule Controls

Design

Materials Management

Overtime

Overtime, Phase II

Productivity Measurement

Quality Management

Quality Performance Measurement

Total Quality Management

Sigma

Construction 2000

Insurance

Retrofit Projects

U.S. Navy Demonstration Project

Constructi on Industry Institut e

3208 Red River, Suite 300

Austin, Texas 78705-2650

512 471 4319


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Organizing for Project Success

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Prepared by the

Project Organization Task Force

Construction I ndustry Insti t ute

Special Publi cati on 12-2

Februa ry 1991


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Organizing for Project Success C o n t e n t s

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1 Chapter 1: In t roduct ion

3 Chapter 2: Construct i on Organizat i on

3 Concept of Organization

3 Organizational Exchanges

5 Chapter 3: The Proj ect Team

5 Concept of Teams

5 Types of Proj ect Teams

8 Teams, Leaders and D ecisi ons

13 Chapter 4: M anagi ng the Effects of Uncert aint y

14 The Tunnel

14 The O ffi ce Compl ex

19 Chapter 5: Coordinati on Tools and M echanisms

19 Project Objective-Setting

22 Design Basis

24 Proj ect St rat egy25 Work Planning

25 Information Systems

27 Chapter 6: Team Dynamics

27 Project Culture

31 Code of Team Conduct

32 Key Team M ember Sel ecti on

34 Select ing the Ow ner Proj ect Executi ve

36 Sel ecti ng Proj ect M anagers

37 Work Managers

38 Team Development

42 Chapter 7: Summary

43 References


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Chapter 1 I n t r o d u c t i o n

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Mans long-time dream of traveling to the

moon became history on July 20, 1969, when

astronaut Neil Armstrong of the United States

took one small step for man, and one giant

leap for mankind. Few human endeavors

could rival this accomplishment, and few

humans fully understand the massive planning,

task execution, coordination, and teamwork

required to make such a journey possible. It is

an historical testimony to the principle of chan-

neling the efforts of a large number of people

toward the accomplishment of a single goal-afeat that could not have been realized by any

other method.

Construction projects rarely have historical

significance, yet must be planned, organized,

and executed by teams of people dedicated to

the accomplishment of a complex task, just as

in the case of a space exploration project.

The working environment and culture of a

construction project is unique when compared

to most work conditions. Groups of people,

normally from several parent organizations, areassigned to a project or hired to contribute

their services and assist in the construction of a

facility. Due to the relatively short life of a con-

struction project, loyalties are usually with the

parent companies, and the construction project

is not viewed as a career, but as a career step.

Even a modest-sized construction project

involves a tremendous number of people.

Organizing their efforts would be complex,

even if they all worked for the same parent cor-

poration. The division of effort and methods ofcoordination change as the project moves

through distinct phases. Sources of informa-

tion, location, timing, and problem complexity

change as people enter the project, perform

their assigned duties, and depart. Reorganizing

is a continuous process that attempts to bal-

ance conflicting values and requirements.

The heart of the matter is the basic problem

of managing people such that they work

together efficiently to accomplish the goal. This

requires enlistment of skilled people who are

willing to sacrifice short-term gratification for

the long-term satisfaction of achieving a larger

goal.

This CII publication addresses methods,

guidelines, and considerations necessary for

successful project organization, key member

roles and selection, and the elusive art of effec-

tive teamwork. No two construction projectsare the same; there is no substitute for common

sense and flexibility in the administration and

application of these methods and guidelines.

Reading this document, a common thread of

thought will be noticeable: the key to successful

organization architecture is selection of proper-

ly skilled people. These individuals possess the

ability to recognize the degree of uncertainty,

at any point in the execution of the project,

and manage the efforts of others to achieve

clearly defined objectives that result in success-ful completion of the final product.

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Chapt er 2 Construct ion Organizat ion

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Concept of Organization

When an owner undertakes a construction

projec t, what is be in g bought is re al ly th e

efforts of a team in addition to a completed

facility or product. All but the simplest pro-

jects involve the efforts of a diverse group of

people who work together to serve the needs of

a project, yet who also work apart in the ser-

vice of different corporations.

Improving the ability of groups of people to

work together requires a shift in thinking at all

levels. Developing a project should be viewedas managing a complex decision-making pro-

cess, rather than merely preparing a series of

products. This requires focusing on the com-

mercial contract between parties and the roles

of people within work groups. These working

groups are teams that work together to accom-

plish more than they would if they worked sep-

arately. The use of teams is central to the con-

struction project approach because a team is

where the decision-making process begins.

While planning construction, organizations

use a combination of planning and immediate

problem-solving techniques. The team created

to tackle a problem should be composed of

individuals whose history and skills are

matched with the tasks at hand. This team

should be constructed so that the skills of its

individual team members are combined to best

serve the overall purpose of the team.

The lines and boxes of an organization chart

depict the concept of division of work and the

relationship of the worker to formal authority.

Organization can be defined as the sum of the

ways labor is divided into distinct tasks (the

boxes) and coordina tion required among the

tasks (the lines). The people assigned to the

organization, with all their history and skills,

and the task before them determine the struc-

ture of the organization.

The nature, or structure, of the organization

depends on the task the organization is to per-

form. It has been said, Uncertainty appears to

be the fundamental problem for complex orga-

nizations. Coping with uncertainty is the

essence of the adminis t ra t ive process .

Uncertainty arises both within the personal

relationships inherent to the organization as

well as the task environment. Organizations

cope with uncertainty by a combination of

planning and immediate problem solving.

Organizational Exchanges

Exchanges are an essential activity in the

internal dynamics of an organization. An

example of an exchange is the contract, which

is designed to protect organizations, constantly

at risk, as they function in a highly competitive

b u s i n e s s e n v i r o n me n t . T h e c o n c e p t o f

exchanges is integral to the way organizations

do business.

Jus t as commerc ia l con trac ts involve

exchanges between large corporations, and

similarly small private contracts establish for-

mal rules for exchange of products or services

between contracting par ties, exchanges occur

among team members performing the work.

The concept of exchange includes the behav-

ior and relationships of team members. For

example, someone must stop to answer the

questions of a co-worker-such an exchange

costs time, but the team gains because work

can proceed. In the same way, if a team mem-

ber has an original, creative idea, he or she may

lose individual recognition once the idea is

implemented by the team.

As a project moves from an uncertain con-

cept to a determined reality, as illustrated in

Figure 1, the mix of behavior and product

exchanges varies, evolving from behavioral

exchanges during conception and development

to product-related exchanges during actual

construction. The nature and composition of

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the team and the rules governing its behavior

usually change as a project advances through

developmental stages, during which initial

uncertainties are resolved and the project

becomes increasingly more well defined.

Figure 1 Phases of Certainty

Uncertain Certain

100% Ideas/Behavior 100% Products/$

Develop a

concept

4

Set

ObjectivesDecide howto achieve

objectives Designwhat to bolt

together Design howto bolt it

together Buy bolts

Bolt togeth


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Chapter 3 The Project Team

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Concept of Teams

A team may be defined as a group of people

who, by working together, accomplish more

than if they worked separately. A team is more

than a group but less than a community. A

group is a number of people who come togeth-

er in the same place at the same time. A group,

however, is not trying to work together to

accomplish anything. A community is a group

of people with close personal relationships who

care about each others well-being. The com-

munity, however, is not necessarily trying toaccomplish anything more than maintaining

itself.

A team is more than a group because indi-

viduals are cooperating in order to accomplish

a goal. A team, however, is less than a commu-

nity because its members do not necessarily

have close, personal relationships. Team mem-

bers should trust and respect other team mem-

bers, but friendship is not necessary for effec-

tive teamwork. Teams function effectively on

the basis of professional relationships. A teamcan be a democracy or a dictatorship; its mem-

bers may have volunteered or may have been

assigned. Once a person becomes a member of

a team, however, the definition above applies.

Robert Keidel, in his book Game Plans:

Spor t s St rat egies for Business, discusses organi-

zation types by using an analogy of spectator

sports-baseball, football, and basketball.

Baseball is a simple game with few rules; the

players are independent, with little interaction

compared to other sports. The skill and perfor-mance of the individual players are the most

i m p o r t a n t c o n s i d e r a t i o n s f o r s u c c e s s .

Individual performance is monitored by many

statistics. A sales organization is the best analo-

gy to a baseball team. The rules are simple:

Sell! The sales people work independently, and

the success of the organization is determined by

the cumulative success of all the individual

salespersons, who are often paid according to

the ratio of sales to quota.

Football, however, is a complex game with

many rules. Teamwork and individual team

members focusing their skills to perform as a

unit on each play are the basic ingredients of

success. The game plan, which gives hierarchi-

cal direction and specifies systematic team-

work, is important. Most industrial organiza-

tions are analogous to a football team; they are

functional organizations, driven by a business

plan, and require continuous interac tion and

communica t ion be tween indiv iduals and

departments.

Basketball, in our organization analogy, lies

somewhere between baseball and football. It is

played in a continuously changing situat ion ,

and player-coordinated, spontaneous team-

work is the most important feature for success.

The family restaurant, in which every family

member cooks, serves, washes dishes, and acts

as cashier, is an example. Other examples are

university staffs and multi-disciplined consult-

ing firms. High technology companies fit this

category and are dependent on teams, working

independently, to develop products and pro-

cesses for marketing by the larger entity. These

development teams come and go as opportuni-

ties arise and needs are satisfied.

Types of Project Teams

Acknowledging that construction contract-

ing is a team process, not the transfer of fin-

ished goods, poses the question, What kind ofteam? Figure 2 illustrates the simplest expla-

nation, where the project team is viewed as ele-

ments from each contracting party assigned to

the project to produce the desired facility. This

is a baseball concept and implies that project

success is achieved by each party fulfilling its

assigned contractual responsibilities. There is

some interplay between the parties, as specified

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in the respective contracts. The most important

consideration is the ability of each player to

perform well.

Figure 2 Project Team Elements

This concept views teamwork as contract

administration, or the management of the rela-

tionship between the contracting parties. It rec-

ognizes that these parties are usually hypotheti-

cal legal entities, and it attempts to solve the

associated problems. The concept acknowl-

edges that real people are involved; personal

relationships are defined in terms of accepted

social behavior, such as ethics, honest commu-

nication, and professional competence.

Research indicates that the baseball con-

cept is the traditional approach in the construc-

tion industry. Company manuals address rela-

tionships between individuals and specify howeach companys team will deliver contractually

required intermediate products to the other

companys team. Intercompany, or joint, teams

are not part of this concept and usually are not

addressed in either the contract structure or

procedure manuals.

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The baseball concept is not wrong, but it

is insufficient for large, complex construction

projec ts. It may be adeq uat e for spec ial ,

uncomplicated projects, with little schedule

pressure, where detail design is complete before

cons truc t ion beg ins and no changes a re

required. Most construction projects, however,

do not fall into this category.

The football concept is a better fit for the

construction process. It is driven by planning

and includes many diverse relationships. The

hierarchy of teams (although they may not be

formally designated this way) on a construction

project shown in Figure 3 is described briefly in

the text which follows, and in greater detail lat-

er in this chapter.

Investment Management Team. After a posi-

t ive inves tment dec is ion , an Inves tment

Management Team is formed in the owners

organization to provide overall control of the

new venture. The major functions, such as

marketing, engineering, finance, and manufac-

turing, are usually represented. A Project

Executive usually leads the team and reports to

the head of the business unit which made the

new investment.

Project Management Team. The Project

Management Team is composed of responsible

managers from each of the contracting parties.

Their mission is to accomplish the work,

including coordinating the engineering, pro-

curement, construction, and startup phases.

The Owners Project Manager leads this team

and a lso is a member of the Inves tment

Management Team.

Contractor Management Teams. Reporting

to each of the Contractor Project Managers arethe Work Managers, who together comprise

the Contractor Management Teams assigned to

the project by each of the contracting parties to

fulfill the requirements of their contracts. Each

Contractor Project Manager reports to both

the Owners Project Manager for contractual

matters, and to the Project Sponsor in the par-

ent organization for business matters.

Work Managers. The Work Managers are


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the design leaders and supervisors who lead the

teams actually accomplishing the work. They

are directly responsible for the part of the con-

tract assigned to them by their Contractor

Project Manager, in accordance with the busi-

ness practices of the parent organization. They

must also communicate and coordinate their

efforts with Work Managers from the other

bus iness uni ts. Usually, thi s communica tion

does not flow vertically through the chain of

command, but instead flows horizontally

between people actually involved in the work.

Work Manager Teams. Communication at

the working level is not just a network. Instead,

teams of individuals from the various business

units are united to accomplish specific tasks.

For example, the lead designer for a structure,

Figure 3 Project Teams

the steel fabricator, and the general superinten-

dent have to understand each other and also

work together if the steel is to be erected cor-

rectly and on time. Ideally, the basic elements

of the Work Manager Teams should be in

place during definition and planning, thus giv-

ing a voice to those who implement final pro-

ject responsibility in determining their future.

An example is the constructability analysis

addressed by other CII publications.

This hierarchy of teams is similar to a pro-

f e s s i o n a l f o o t b a l l o r g a n i z a t i o n . T h e

Construction Owner is similar to the owner of

a football team who contracts for the required

resources. The Project Management Team is

the coaching staff which forms the game plan.

The Owners Project Manager is the head

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coach. The Work Managers and their teams

are the running backs, wide receivers, interior

linemen, linebackers, and other players who

actually participate in the game.

Professional football organizations also

incorporate flexibility into their teams. Run to

daylight and improvisation on broken plays

a r e i n t e n t i o n a l p a r t s o f t h e i r s t r a t e g y .

According to the analogy used here, some bas-

ketball is played in the middle of the football

field. Similarly on successful projects, the Work

Managers, who are the players, form Work

Management Teams to adjust their efforts

across business unit boundaries.

Teams, Leaders and Decisions

Construction is driven by a planning pro-

cess. Increasingly detailed decisions are

required when moving through the hierarchy of

teams. Decisions at one level become action

items for the next team. To facilitate the dele-

gation process, the leader of each team, except

for the Project Executive, is a member of thenext higher team. Table 1 is an illustration of

this leader/team ladder with a listing of the

major decisions made by each team. Two kinds

of decisions are to be made. The first is plan-

ning decisions-what will be built and how is it

to be constructed? Secondly, process decisions

are required to determine how each team will

conduct business. These process decisions form

part of the code of conduct, which is described

in Chapter 6.

During the definition and planning phase,the needs of the owner must be determined.

Someone must organize the owners team and

establish a clear direction for the project. The

key to success is a strong Project Executive,

who has the power and authority to make deci-

sions of impact. This function is necessary

be ca us e th e Ow ner s Pr oj ec t Ma nage r ma y

have insufficient influence to resolve disagree-

ments, which occur due to conflicting objec-

tives of the marketing, manufacturing, finance,

and engineering functions.

A formal Investment Management Team

should be formed from elements of the owners

organization to define project objectives, estab-

lish priorities, and approve the work of con-

tractor teams. This team is led by the Project

Executive and includes representatives from

marketing, engineering, finance, procurement,

the Owners Project Manager, and the user,

such as the manufacturer. This group overseesthe project, reviews and approves vast amounts

of information, establishes policy, solves prob-

lems, makes decisions, coordinates, and com-

municates. This team function is vital to pro-

ject performance.

Generally, the Project Executive resolves

conflicts within the owners organization. It is

essential that this position has sufficient

authority, either formal or informal, to make

necessary decisions which will allow the

Owners Project Manager to implement anaction plan. The Project Executive should be

the ultimate contractual authority. If not, there

must be an established, rapid board or commit-

tee authorizat ion process that the Project

Executive can use to resolve conflicts and force

decisions.

Approvals are a special consideration for the

Investment Management Team, since these are

their tools to control the project organization.

This applies to planning documents, contractu-

al commitments, progress payments, and finalacceptance. A rapid process must be estab-

lished to gain approvals within the owners

organization. Approvals should be natural con-

trol points during the life of the project; they

must not become lengthy processes which delay

project progress. The Project Executive should

set the tone for open, candid communications

and timely action.


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Table 1 Project Teams, Leaders and Decisions

Teams & Leaders

Project ExecutiveInvestment Mgt.

Project Mgt. Owners Proj. Mgr.

Contractor Proj. Mgrs.

Decision Responsibilities

Planning Process

Project Objectives Approvals

Project Strategy Changes

Roles & Responsibilities Problem Solving

Information Systems

Contractors Mgt.

Work Mgr.

Work

Lead DesignerGeneral Supt.

Work Mgrs.

(Company Requirements)

Constructability Analysis

Construction Schedule

Work Plans

(Company Requirements)

Technical Resolutions

Submittals

Operations Schedules

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l

l

l

l

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An Owners Project Manager (OPM) is the

member of the Investment Management Team

responsible for the management of the design,

procurement, and construction activities; this is

prob ably the mos t importan t mana gement

function of the project. The OPM may have

limited resources under direct control because

the work has been contracted to various busi-

ness units. Still, the OPM is responsible for the

accomplishment of this work.

Most owners recognize the need for an

OPM, but may not realize the importance of

the position. As a pure management position,

the OPM is responsible for getting the work

accomplished through other people. The OPM

should be the agent of the owner, authorized to

act on behalf of the owner. The OPM does not

have to be the ultimate contract authority, but

must be authorized to represent the owners

interest, within the bounds of the established

contracts.

The Owners Project Manager should be an

e x p e r i e n c e d c o n s t r u c t i o n p r o f e s s i o n a l .Manufacturing supervisors and facilities man-

agers may not be familiar with the construction

process. If the owner does not have such a staff

person, one should be acquired for the project.

The Project Management Team, a joint team

of the Contractors Project Managers, is led by

the Owners Project Manager. The primary

task of this team is to plan the project, subject

to the approval of the Project Executive. This

team also develops the project strategy, with

the resulting project schedule, and specifies theinformation system required. Their relationship

is defined by the roles and responsibilities

defined in the contracts between the parties.

Actual management of the design, procure-

ment, and construction activities is pursued by

a network of individual managers. As each

business unit is hired to deliver an end product,

its responsible manager becomes part of this

network. This management team of individu-

als, from different business units, must commu-

nicate and work together to coordinate the

efforts of the various entities. Each manager

must accomplish the work in the contract, plus

coordinate with other managers to control the

f low of work th rough each phase of the

project.

The Project Management Team must define

its rules and personal commitments. The two

most important areas are problem solving and

changes. These require a joint effort and mutu-

al cooperation, despite inherent conflicts

between specific company and overall project

concerns. Each party must provide objective

input. The individuals involved in changes

should mutually decide how they will manage

problems and changes, from inception to settle-

ment. It is important that discussion and mutu-

al understanding be a part of this process.

The Contractor Teams are company teams

from the contracting entities, who are led by

the respective Project Managers. Functional

un i ts wi th in the teams a re led by Work Managers, who are supervisors or design lead-

ers. These teams not only accomplish the main-

line activities of design, procurement, installa-

tion, and startup, but also staff functions, such

as accounting, scheduling, cost control, and

office services.

Delegation is the heart of a Contractor

Team; it requires the responsible manager to

take four steps:

Establish requirements

Make assignments

Monitor results

Give feedback

The last of these is the most important.

Feedback is necessary, not only to adjust indi-

vidual performance, but to revise the original

requirements, which may have been improperly

stated.


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The entire planning process, from project

objective to work plans and operations sched-

ules, is a system of delegation. Without project

objectives, Contractor Teams will not have

clear direction. Lack of project objectives also

makes it difficult to set up effective teams and

delegate responsibility.

Prior to the first day of participation in the

project, Contractor Teams should be instructed

on the expectations of their teams. Company

Teams must understand the importance of

objectives, rules, tasks, relationships, conse-

quences, and personal values. The Project

Executive, Design Project Manager, and

Construction Project Manager must specifically

instruct their teams on required interface rela-

tionships with other teams; different projects

require different interfacing relationships. The

code for a particular project must be communi-

cated explicitly-it cannot be assumed.

The owner should set the pace by dictating

what relationships are expected in terms of:

l Interface authority and responsibility

l Communications

l Coordination

l Methods of settling differences between

teams

These instructions modify the Standard

Operating Procedure (SOP) that governs corpo-

rate team requirements. Without this SOP, tri-

al-and-error adjustments between teams and

their members can be laborious and costly. The

guidelines should be published in the projectpolicy and procedure manuals.

Work Manager Teams can be envisioned as

either one team, with the membership changing

as the task requirements change, or a series of

teams, each formed to address a specific task.

After design is completed, the most prominent

team manages construction operations and

includes those who either report to or support

the General Superintendent for each facility.

This team builds the project and is accountable

for taking it from design to completion. As the

pinnacle Work Manager Team responsible for

everyday production, it is placed between the

deliberation-policy management group and

hands-on implementation. This teams policy-

making authority should be minimal. Time

should be spent in implementation, which

requires combinations of review and approval,

problem solving, decision-making, coordina-

tion, communication, and support. All of these

functions make the performance of this team a

top priority during construction.

This team also is in the trenches of everyday

activity, where there are continuous pressures

to act and respond. On the playing field, in

order to keep close coordination and communi-

cation, team members should be adept at read-

ing one anothers signals, without hesitation,

change, or confusion.

This team is highly visible, and other teams

use it as a guide for their own operations. If

this group is working either exceptionally well

or poorly, then it is known throughout theentire project. The leadership and effectiveness

of these frontline teams are essential ingredi-

ents for a successful project.

It should be noted that in the previous dis-

cussion the term leader is used more often

than manager. This is intentional. The words

have different implications. A manager is

assigned formal authority and the responsibili-

ty for accomplishing a task. The position of a

leader is informal. It depends on the willingness

of the team to follow. The task of the leader ist o e s t a b l i s h t h e d i r e c t i o n o f t h e t e a m .

Managers do things right; leaders do the right

things.

The book, Leaders, identifies four character-

istics common to effective leaders:

1. They gain the attention of their team

through an overriding vision.

2. They are able to communicate and

transfer the meaning of their vision.

3. They gain trust through consistency.

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12

4. They know and are able to manage them-

selves.

Good managers are effective leaders, but

several of the necessary leaders on a construc-

tion project do not have formal management

authority. Figure 4 identifies the Project

Management Team and the Work Manager

Teams as joint teams composed of individuals

from different business units. Although usually

seen as communication networks, they are real-

ly teams of people working together to accom-

plish respective management tasks. They mustbe formed, developed, and led as are the recog-

nized company teams.

Members of joint teams draw from their col-

lective parent organizations the specific objec-

tives and rules that are to be applied. The inte-

gration of these factors, which plainly spell out

how the team should operate, must be adopted

by the team as a whole. The differences in the

parent corporations instructions to the individ-

Figure 4 Types of Project Teams

ual members of the joint team may be slight or

enormous, but differences will exist. These

must either be negotiated out, preferably by the

joint team on the spot, or deferred to parent

corporations for opinions and decisions, and

then be communicated back to the joint team

for adoption.

Not surprisingly, organizat ions depend on

the leadership ability of many key managers

during the construction process-the point

being that leadership and effectiveness of joint

teams is as essential to a successful project as

that of the company teams from the contract-

ing parties.


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Chapter 4 Managing the Effects of Uncertainty

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Development of a project, from concept to

reality, is actually a reduction of the uncertain-

ty process. At every stage of the project, the

team is striving to clarify exactly what is to be

done and how to do it. Figure 5 shows in

matrix form the two dimensions of certainty as

the project moves from concept to reality.

Figure 5 Certainty Matrix

EXECUTION-

Low How High Facility

High

DEFINITION-What

Low

Idea

Projects sometimes start with low certainty

on both axes of the matrix. As planning and

coordinating decisions are made, the project

moves toward completion. Each step in the

process should define more clearly what is to

be bu il t and how the work wi ll be ac com-

plished. In reality, definitions of the what are

not always clear. Uncertainty about what is to

be built continues to arise as project objectives,environment, market factors, and technology

change with the discovery of new information.

Similarly, the behavior and relationships of key

personnel also may change while the project is

under construction.

13

Projects move at varying rates and follow

different paths from concept to completion.

This movement is often described in terms of

phases, such as these:

Forming a concept

Developing objectives

Identifying how to achieve objectives

Designing the project

Procuring equipment, materials and ser-

vices

Constructing the project

Startup and operation

Different team members during different

phases of a project may be in a better position

to collect, evaluate, and make decisions con-

cerning technical and market information.

Although the organization is shaped for the

task of decreasing uncertainty, structure

depends on the perception of project exchanges

which occur. If these perceptions are consistent

with actual circumstances, the organization is

functioning well. For example, on the matrix

shown in Figure 6, a straightforward construc-

tion project can be portrayed as the purchase

of a series of discrete products.

Figure 6 Certainty Matrix


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Lo w

14

Reliance on intermediate products works

well conceptually for projects that start con-

s t ruc t ion in the top r igh t corner o f the

matrix-when both what and how cer-

tainties are high, and the project is not under

any unusual schedule or budget constraints.

(Projects in this quadrant are typically the mar-

ket purchase of a standard product.)

Experience in the high certainty corner of

the matrix is a major force in shaping the way

people view the construction process. The con-

tract and organization resulting from a tradi-

tional market exchange work less well as the

level of certainty decreases.

Many projects begin the construction phase

in one of the other three quadrants. Referring

to Figure 7, the construction phase of a tunnel

might begin in the upper left quadrant, while a

commercial building might begin in the bottom

right. These two situations are discussed below.

Figure 7 Certainty and Paths

Low HO W High F a c i l i t y

Hi gh

WHAT

Idea

The Tunnel

A highway department considers re-routing

a stretch of canyon highway into a tunnel to

avoid a present set of problems. Although they

have some idea what previous tunnels have

cost, they do not have exact information on

geologica l condi t ions . When the pro jec t

appears to be feasible, they begin design.

Borings are conducted and geological studies

are tested. Based on these activities, they select

an alignment, lining, and construction method.

A constructor is chosen to carry out the work.

The tunnel project is shown as Line A in

Figure 7.

Despite the experience and engineering skills

of everyone involved, construction begins with

far less certainty about how the work will get

done than what is to be built. Each advance

into the mountain reveals new information

which changes the work approach. The project

team faces the task of re-planning based on

new information, and the success of the project

depends on finding and implementing cost-

effective solutions to technical problems.

The Office Complex

A developer identifies a piece of land in a

good location for an office complex. The four-

story structure will be steel frame with pre-cast

exterior wall panels. The technical and con-

struction issues are neither unique nor particu-

larly difficult. The exact arrangement of the

internal space, however, is far less certain. The

developer begins construction with less than

half of the space rented. New tenants demand

significant alterations to their space during

construction. The project team must respond to

new information from the marketplace. Success

depends on managing the work effectively and

executing routine tasks efficiently. The office

complex project is shown as Line B on the

matrix.

In fact, projects may begin construction at

any place on the matrix. Projects which origi-

nate in a position down and to the left on the


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matrix can be expected to have a higher

amount of uncertainty and a greater possibility

of change. A research and development (R&D)

facility typically starts construction with less

certainty than other projects and faces more

urgent schedule pressure, as illustrated in the

matrix of Figure 8.

Figure 8 Certainty and Location at Start of Construction

High

WHAT

Low

Idea

Low HOW High Facility

Organization for projects that begin in the

low/low quadrant will differ from others for

sound reasons. Project organizations in this

quadrant should not be based on the projected

exchange of ill-defined products. Instead, these

project teams should be organized to collect,

evaluate, and act on information as the project

progresses. This requires having systems in

place to co ll ec t in fo rmat io n, plan, ac t, andmaintain agreement among all concerned.

Organizations that share information and dis-

tribute decision-making responsibilities can be

impacted by strict contracts based on exchang-

ing products. These organizations must decide

whether to tolerate significant problems or re-

design their structures to channel information

to the appropriate person. This will insure that

decisions are acceptable to all contractual par-

ties.

Not surprisingly, interesting developments

occur on projects located in the lower left-hand

corner. Here, it is obvious that the traditional

view of the construction process, where prod-

uct exchanges are controlled by the classic con-

tract, results in organizations less likely to

make effective decisions required to complete

dispute-free projects.

By fostering the newer concept, which views

construction as a team-oriented process, own-ers and major construction companies are

forming long-term relationships, a key element

in the concept of partnering. Partnering is

the formation of an on-going relationship

be tween those who know how to construc t

projects and th ose who dete rmin e what is

required. As shown on the matrix of Figure 9,

constructability is enhanced by partnering.

The matrix in Figure 9 has a number of

implications for project organizations and con-

struction management practice. Optimum con-struction strategy is based on the location on

the matrix and the objectives of the project.

Procurement policies and procedures must

Figure 9 Certainty Matrix and Change

Low HOW High

High

WHAT

15

LowConstructability

Partnering


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Low

Followingthe Plan

16

mesh with the chosen strategy. Project teams

must spend time and money to reduce uncer-

tainty if they expect to manage subsequent pro-

ject phases and their intermediate products.

The meaning of change depends on the

quadrant where a project is located, at a point

in time, as shown on the matrix of Figure 10.

Figure 10 Certainty Matrix and Change

Low HOW High

High

WHAT

The trend toward early involvement of all

concerned parties during construction is benefi-

cial; it assembles the people who know best

how to do something with the people who

determine what they want. This can be seen in

the development of partnering relationships

and the recent emphasis on constructability.

Difficulty can arise, however, when people who

are accustomed to functioning in the high/highquadrant, where direction is unambiguous and

change is perceived as an enemy, meet people

from the low/low quadrant who consider

change as beneficial while refining the project

plan.

Conflicts may occur when people have dif-

ferent ideas concerning where the project is

located on the matrix. Disputes are likely to

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result when managing a project with inappro-

priate contractual tools for its location on the

matrix. For example, conflict is likely if the

owner uses a contract based on a highly certain

view of the project, while the contractor views

the project definition as unstable.

Factors which determine project success vary

by quadrant. Developing clear objectives is an

early requirement in the low/low quadrant.

Following the plan is the obvious key in the

high/high quadrant. Projects in the top left

quadrant require high quality technical solu-

tions for optimum performance. Projects in the

lower right quadrant need high quality coordi-

nation to achieve efficiency. These success fac-

tors are shown in the matrix of Figure 11.

Figure 11 Certainty Matrix and Success Factors

Low HO W High

HighHigh QualityTechnical

Solutions

WHAT

Low Clear

Objectives

High QualityManagement &Coordination

The project starting point position on the

certainty matrix, or the degree of definition,

has an impact on the initial communication

strategy of a project organization, as shown in

the matrix of Figure 12 (next page).

In the lower left uncertain/uncertain quad-

rant, the usual practice is to release the work in

increments, as soon as each piece is defined.


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The Investment Management Team must take

the lead and initiate numerous top-down com-

munications specifying what is needed for each

piece. The designer, supplier, and constructor

then define and implement to satisfy each need.

A phased construction approach is used,

with considerable overlap between design and

construction. Research facilities, some weapons

systems, and hazardous waste clean-up projects

are examples of this approach.

In the upper left certain/uncertain quadrant,

communication is critical between the work

Figure 12 Certainty Matrix and Communications

WHAT

HOW Cer ta in ty

Uncer ta in ty

force and the Project Management Team. On

tunnels, dams, and other large earthwork pro-

jects, the construction method, and perhaps the

design, must be adjusted during the construc-tion process. As the primary planning team, the

Project Management Team must respond to the

adjustments.

In the lower right uncertain/certain quad-

rant, neither design nor construction is diffi-

cult. The problem is to adapt to the specific

needs of the marketplace. The general parame-

ters of a commercial office building can be

established sufficiently in advance to support

f inanc ia l ana lys is , funding , and contrac t

awards. When the ultimate user is identified,

considerable adjustment may be required.

Again, the Project Management Team must

control this process and incorporate only the

necessary, practical changes to design and

required construction.

In the upper right certain/certain quadrant,

both what and how are known. Work can be

clearly delegated to the designer, supplier, and

b u i l d e r . Th e a b i l i t y o f t h e Co n t r a c t o rManagement Teams will determine the perfor-

mance of the contracting parties and the suc-

cess of the project. The key communication is

the reporting and monitoring system which

insures contract performance, as well as

prompt payment for the work accomplished.

This is the traditional view of the construction

process, and many projects fit this category.

This is the baseball concept, mentioned

earlier.

The task force has conducted workshops inwhich participants have indicated that not only

is the baseball concept inadequate for many

pro jec t s , b u t t h e f o u r q u a d r a n t s o f t h e

What/How Matrix also may be incomplete.

The population of industry projects is not neat-

ly polarized into four separate categories.

Rather, the project population is concentrated

more in the center/center of the What/How

Matrix, with the centroid only slightly above

and to the right of center. Many projects are

not in one of the quadrants, but in a mixture oftwo or more quadrants. More research is

required to identify the variables and the orga-

nizational impact when a project is a mix of

the various quadrants. 1The foregoing does not give many prescrip-

tions. Hopefully it will supply valid and useful

concepts for the individuals on a specific pro-

ject so that they can agree on where they are


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and what they need to do together. One of the

problems is that there are no units on the What

and How dimensions. Also, no objective mea-

surement determines where a project is. The

location is determined by the perception of

each individual, and perceptions vary because

no one knows everything. This makes the

matrix a useful discussion tool to determine

where the parties are coming from and address

the differences that get in the way of a success-

ful team effort.

Project organization, uncertainty, and types

of teams have been discussed, with emphasis

on general concepts and organizational theory.

Chapters 5 and 6 will address specific, practical

applications of the subject matter presented in

the previous sections.

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Chapter 5 Coordination Tools and Mechanisms

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Successful organizations do not occur

because groups of people are brought together

in an office or at a jobsite. Many different

forms of organizations can be successful; such

organizations share a unique set of coordinat-

ing tools and mechanisms that allow the group

of individuals to act in a cohesive, focused

direction toward satisfying a single purpose.

Coordinating tools and mechanisms include:

l A comprehensive objective-setting

process

l The design basisl A project strategy

l Work planning

l Information systems

Project Objective-Setting

Managers in the construction industry agree

that a critical ingredient to the success of a pro-

ject is the objective-setting process. This pro-

cess is closely related to planning efforts, scope

definition, and project team motivation. In

many cases, the process of establishing objec-

tives may be as critical in building team com-

mitment and understanding as the objectives

themselves. Just as the process contributes to

the success, research has shown the wrong pro-

cess can lead to difficulties. The lack of clear

owner-objective definition, internal consistency

of objectives, and clearly communicated project

objectives can create costly problems for pro-

ject teams.

Objectives, including trade-offs betweenquality, costs, and schedule, are used to guide

numerous decisions. The objectives guide the

development of more specific goals, proce-

dures, design criteria, and milestones. When

more detailed definition of the project is

required, the objectives are used as the bench-

mark for specific direction.

Ideally, a common set of objectives should

guide the owner, designer, and constructor.

The objectives provide the basis for all parties

and, as such, must be compatible. The compat-

ibility is essential to minimize conflicts among

the owner, designer, and constructor organiza-

tions concerning the project objectives. The

objectives should be established, and all teams

should clearly understand them and be in

agreement with the relative priority placed on

each objective. When this occurs, the various

teams can begin to accomplish their specific

responsibilities in harmony with other teams.

The objective-setting process should be a delib-

erate, managed process.

The three phases in the management of pro-

ject objectives are: formation, communication,

and integration. These three phases are shown

in Figure 13. The formation phase consists of

the methods used by the owners organization

to combine the corporate goals and suborgani-

zation objectives into a single set of project

objectives. The communications phase is the

means by which the owner disseminates, bothdirectly and indirectly, the project objectives

developed in the formation phase. The integra-

tion phase represents all efforts on the part of

the owner to combine the project objectives of

the designer and constructor with those of the

owner, thus forming an integrated project

strategy.

Strong owner involvement is needed in each

phase to aid in the planning, programming,

design, and construction of a project, regard-

less of how many outside organizations arecontracted. Feedback is critical to insure that

the system is working properly and objectives

are common to all organizations. Written pro-

ject objectives provide a focal point for discus-

sion and periodic review.

Formal processes can be used to form pro-

ject objectives. Case studies of several projects

have been used to develop the process present-

19


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Figure 13 Certainty Matrix and Communications

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ed here. The recommended process to define

project object ives requires that internal uni ts

within the owners organization (engineering

department, marketing department, and other

functional departments) work together to iden-

tify appropriate objective priorities. This team

environment is the key ingredient of the pro-

cess, as it provides for open communication,

compromise, and putting the goals of the larger

organization ahead of the internal unit goals.

The role of a Project Executive is critical to the

success of this task.

The recommended approach for managing

project objectives includes the following critical

elements:

l Study and fact-finding to develop

objectives

l Communication and negotiation to

establish objectives

l Communication of objectives to parties

throughout the organization

l Feedback, direction, redirection or rein-

forcement related to project

objectives and priorities

Several studies may be necessary to define

the problem or opportunity adequately in tech-

nical and financial terms. The process requires

considerable fact-finding, discussion, and anal-

ysis. A set of written objectives statements is

usually the product. The objectives should be

stated in terms that are:

l Specific and identifiable

l Oriented toward single-ended results

l Set against deadlines

l Attainable

l Responsible to organizational needs

l Controllable

l Assignable to organization units and

individuals for accountability

Single objective statements are best, but they

should not be general. Specifically, it is impor-

tant to state objectives clearly and avoid com-

munication problems.

Blending the various suborganizational

objectives (e.g., marketing objectives, engineer-

ing objectives, operation objectives, and finan-

cial objectives) into a consistent and stable set

of well-defined, user-oriented project objectives

is an important task.

Several mechanisms can contribute to, or

detract from, the effectiveness of communica-

tion. These mechanisms are classified as com-

municating, reinforcing, and detracting mecha-

nisms. Communicating mechanisms, those

items used to transmit objectives directly to the

participants, include:

l The project execution plan

l A written design basis

l The contract documents

l Policy and procedure manuals

l A pre-bid or pre-construction meeting

l Written objectives and priorities

l Constructability reviews

Reinforcing mechanisms which support and

emphasize the communicating mechanisms are

used to maintain focus and direction for the

continual process of communicating objectives

throughout the organization. Reinforcing

mechanisms include:

l Weekly progress meetings

l Executive level reviews

l Expediting reports

l Project instructions

l Project team layout

l Toolbox safety talks

l The tone of correspondence21

Detracting mechanisms which create situa-

tions where separate, incompatible objectives

are established by the various project organiza-

t ions ex is t th roughout the cons t ruc t ion .


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22

Examples of detracting mechanisms include:

Poorly defined design basis

Inconsistent design requirements

Poorly designed project communication

systems

Lack of expertise

Dominant external objectives

Lack of project controls

Poor operational planning

Inappropriate staffing levels

Key individuals unavailable for

decision-making at the project

Detracting mechanisms have strong negative

impacts on projects. All of these mechanisms

point to the need for good communication sys-

tems, with a deliberate feedback system, to

insure the effectiveness of communication.

Design Basis

The Business Roundtable states in its

Construction Industry Cost Effectiveness

Report A-2, Poor scope definition at the esti-mate stage and loss of control of the project

scope rank as the most frequent contributing

factors to cost overrun. The CII Design Task

Force, in CII Publication 8-2, Input Variables

Impacting Design Effectiveness, considers

scope definition to be the input variable with

the greatest impact on design effectiveness.

Prior to the beginning of design and con-

struction, it is important to establish and

define, with appropriate detail, the intent a giv-

en project is to achieve; yet, this task is not

always given proper attention. The design

basis, a set of documents written and drawn to

define the technical requirement for the project,

must have sufficient depth to provide clear

direction for all major design issues. The for-

mat of the design basis varies, but usually

includes drawings and specifications, and may

be supplemented with renderings, models , or

even three-dimensional CAD graphics. The

design basis may be a series of documents pro-

duced early in the design process. There may be

other documents produced at interim stages

requiring approval prior to proceeding to the

next stage. The design basis should clearly

communicate the intent to the designers and set

appropriate boundaries on the project design

for detailed decision-making.

In order to maximize the effectiveness of the

design basis, three requirements must be met:

Completeness-There must be sufficient,detailed information to address all the

design issues for a project such that

informed decisions can be made by the

project personnel.

Consensus-Person or persons in the

owners organization who make decisions

and approve the design basis must com-

prehend what they are approving, and

should have the concurrence of all parties,

including those who operate and maintain

the facility.

Communication-The design basis must

be shared openly, not only with all parties

in the owners organization, but with the

designers and constructors as well. When

the design basis is sensitive or proprietary,

security procedures must be established.

Although a relatively small portion of project

personnel develops the design basis, the impact

of this effort is great. Design changes, particular-

ly after the design basis has been set, can create

havoc on the project and dramatically add to the

cost of design and construction. The change of

an important aspect of the project during the

development of the design basis may take only a

few hours to implement. The same change, late

in design or during construction, can cause enor-

mous cost and intolerable delay.


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The design basis development phase is notthe occasion to save time or money. High qual-

ity resources must be dedicated to, and time

allowed for, development of the design basis.

Prior to the beginning of the design basis, a fea-

sibility study must be completed (by in-house

personnel or consul tants exploring the basic

idea for the project, with appropriate financial

analysis resulting in tentative approval to pro-

ceed with the project). The owners goals and

objectives must be formulated at this point; the

designer then can gather information anddevelop the design basis.

Generally, two kinds of information are

gathered. The first is the given conditions and

constraints; these include site condition infor-

mation such as survey, climate, traffic, soils

investigation, hydrology, drainage, and envi-

ronmental constraints. If a project involves the

renovation of an existing facility, a comprehen-

sive analysis of the facility is necessary. In addi-

tion, legal requirements such as building codes,

Federal regulations, zoning ordinances, andlocal government approvals must be examined.

The requirements of the owners insurance car-

rier also must be considered. Local utilities

must be contacted to determine the availability

and location of services. If the owner has a sys-

tem of space standards or other general design

requirements, these must be identified.

The second type of information gathered

concerns project needs. The designer must

work with the owners project manager to

establish the owners requirements for the pro-

je ct . These in clude th e obvious fu nc tional

requirements such as the amount of space, the

produ ct ion cap ac ity, en er gy co nsu mpt ion,

number of occupants, the performance criteria

system, aesthetics, image, flexibility, and

expendability.

The next step in the development of the

design basis involves establishing the criteria

and evaluating various alternatives to meetthose criteria. The owner, guided by various

representative departments, makes choices

among reliable alternatives. The documents

which are developed at this stage include gener-

al arrangement drawings, site plans, architec-

tural elevations, flow diagrams, and the outline

specifications for mechanical, heating, ventila-

tion and air conditioning (HVAC), electrical,

and structural systems. Along with these con-

ceptual definitions, an early estimate of the

project cost is prepared based on the conceptu-al design.

The next step in the development of the

design basis involves further definition of each

of the systems. A more detailed set of site

plans, indicating the utilities and support build-

ings, is developed at this stage. Materials are

selected; floor plans, elevations, and typical

details are developed for building the facility;

building systems are diagrammed; and an ener-

gy analysis will be prepared. The piping and

instrument diagrams may be prepared; modelsmay be developed to show the relative posi-

tions of major pieces of equipment; and con-

structability is brought into the evaluation of

the design basis. Value engineering, or selecting

the most economical alternatives for the overall

life cycle of the project, also should be a part of

this process. Since the owner usually is working

with financial constraints on the project, it is

common during the development of the con-

cepts and the design basis to adjust the criteria

to fit the owners budget, which must be

matched with the scope of work.

The design basis development, described

above, is a constant design, review, and re-

design process which should involve the owner

on a weekly basis.

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24

Project Strategy

A plan-often called a project strategy-is

required to carry out tasks in a timely manner,

even in the early stages of project development.

The project strategy provides overall direction

for the project team, which must make numer-

ous decisions throughout the course of the pro-

ject. In effect, the strategy serves as a road map

for that decision-making process. The project

strategy includes four key elements:

l A contracting strategy

l Logistics and support

l A project schedule

l A listing of the roles and responsibilities

The owner determines the formal structure

for the project team through the formation of

the contracting strategy. The contracting strate-

gy identifies the risk allocation, as well as the

overall organization structure, and provides

definition for the roles and responsibilities for

each team member. In the early stages of pro-ject st ra tegy development, th e owner must

determine whether to perform certain tasks and

duties or assign them through a contract to

other specialists. The owner may have a large,

sophisticated engineering staff to perform the

majority of design, procurement, and project

management; in other cases, the owner may

have only a limited staff for projects, necessi-

tating the purchase of outside services for the

early design work. The owner organization

must make an honest assessment of an outsidefirms capabilities to perform these services and

evaluate the economic trade-offs of purchasing

outside services.

Next, the type of contracts used must be

determined. Sensitivity of time is probably the

most important consideration to the investment

decision. Owners who desire a fast-track sched-

ule may contract on a cost-plus-fee basis. If

time permits and design is complete, the tradi-

tional design/bid/build approach may be used

and a lump-sum contract awarded. Industry

traditions often influence the type of contract

selection. In the process industry, contractors

working closely with an owners engineering

staff can be responsive, timely, and cost effec-

tive using cost-plus-fee contracts. In contrast,

public agencies tend to use lump-sum contracts

when design is complete and then award a con-

tract for a fixed sum prior to the beginning of

construction. Realistically, the owners project

team should investigate all the possibilities,

identify advantages and disadvantages consid-

ering the project schedule, and develop a prac-

tical approach that meets the project objectives

and includes the necessary, most cost-effective

provisions.

After the contract type is decided, the next

contract strategy development step is to deter-

mine a suitable acquisition process. Issues

include local design and contracting firms vs.

national contracting firms, open or selectivebid process, and the time required to choose a

contractor. The acquisition process can include

price and/or technical competit ion. The impor-

tant result is selection of the best qualified con-

tractor to perform the work-a contractor who

can, with some certainty, meet the project

objectives.

The second element of the project strategy is

logistics and support planning. Logistics and

support include housing (such as a construction

camp), construction site access, temporaryoffices, construction parking, and construction

utilities. Supply routes, means, and communi-

cations also are elements of the logistics and

support which must be planned. On some pro-

jects, it is appropriate to have a project labor

agreement. Logistics and support should define

procurement of long-lead or special materials

required. On large process projects, major pur-


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chases of specialized equipment and vessels

during the design stage are common.

Project schedule development is part of the

project strategy; by definition, a project sched-

ule is the time phasing of design, procurement,

and construction tasks. The schedule is normal-

ly a network diagram of required activities.

The purpose of the schedule is to identify the

interfaces between activities. The project sched-

ule defines the logic and expected durations for

project activities. A valid project schedule must

be developed, with agreement and approval ofthe client, designer, major vendors, and con-

tractor. Changes to a developed schedule

should be approved by all parties.

Finally, the project strategy includes a defini-

tion of roles and responsibilities. A roles and

responsibilities matrix is illustrated in Table 2.

Risk assignment, an integral part of roles and

responsibilities, should be borne by the party

best able to control the uncertainties associated

with the risk. Some construction risks, such as

site conditions, are uncontrollable; these risksare normally assumed by the owner.

Work Planning

Work planning, an essential ingredient of

successful projects, is vital at every level of a

successful project. The work plan may be a list,

table, bar chart, or network schedule. The

work plan can be a single document for a sim-

ple project or a lengthy document for complex

projects. Each Work Manager monitors perfor-

mance by measuring the quantity and quality

of work accomplished as compared to the

work plan.

The work planning process attempts to cap-

ture the greatest efficiency, while satisfying all

the project objectives: quality, time, cost, safe-

ty, and others. Work planning is normally

accomplished in an interactive, backward, step-

wise fashion. Initially, a target completion date

is established, and startup steps are identified

to satisfy the completion date. A construction

schedule is developed for the construction

phase of the work. Based on the construction

schedule, the designer and constructor establish

the design schedule to support the construc-

tion/startup schedule.

Information Systems

Correct information will not necessarily

reduce project duration, but erroneous or late

information can certainly delay a project and

create serious difficulties. Critical project deci-

sions can be made only when the information

supporting the decision is accurate and timely.

It is imperative that an efficient, effective pro-

ject information system be established. It is

highly unlikely that a large, complex project

could be completed successfully without a com-

prehensive management information system.

The computer software and hardware avail-

able today can dramatically assist a project

team. The hardware and sof tware cos ts ,

although reasonable, are not the only costs

incurred in the establishment of an information

system. The time for training, data entry, and

analysis is a hidden cost (sometimes more than

ten times the software cost). These costs must

be evaluated for effectiveness. Software today

is becoming increasingly more useful to man-

agers. Early software produced only reams of

data, which required processing to produce

useful information; current project software

produces meaningful information that can be

used directly in the decision-making process.

Today, data processing programs are gener-

ally used to manage by exception. The expecta-

tions of managers at each level are classified as

budgets, schedules, or other standards of per-

formance. The computer is used to compare

volumes of data to these standards and identify

significant variations from expected results.

25


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The variances provide evidence of problems

requiring management attention. The process

can be applied to most standard project objec-

tives, which include quality, time, cost, safety,

and other critical matters.

With further advances in computer-based

information systems, the construction industry

will be positioned to perform projects more

effectively and efficiently.

Table 2 Roles and Responsibility Matrix-Definition Planning Stage

26R RESPONSIBLE for making the function or decision happen. Accountability and initiative are here.

A must APPROVE, including the obligation to penetrate, question, understand and concur.

C must be CONSULTED by R prior to decision.

I must be INFORMED of decision by the R person.


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Chapter 6 Team Dynamics

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Project Culture

To understand how to use human factors

and fulfill capabilities, one must understand the

unique culture of a project and how it differs

from many other organizations. Culture, the

total array of internal values at work, is the

sum of the practices that get the job done.

Table 3 shows a comparison of construction

culture.

Objectives. In most organizations, the cen-

tral values are fairly clear and subscribed to by

most members, particularly by the key players.Even in conflict, the objectives are often made

clearer. Most relationships are, therefore, advo-

cacy-centered or win-win driven.

On construction projects, the participating

companies may share the immediate objectives

to complete the project safely, cost-effectively,

and on schedule. Broader organizational objec-

tives are different and often conflicting.

Engineering firms may be devoted primarily to

their professional performance, reputation, and

defenses against penalties of legal liabilities.Constructors are concerned about profit mar-

gins, safety, add-on work, risks, contract obli-

gations, and others. The concerns of the owner

may include cost, schedule, or the process;

within the owner organization, priorities may

conflict. The project is a perfect medium for

competing objectives and adversarial relation-

ships.

Rewards. Systems of rewards in other orga-

nizations are based on adhering to the objec-

tives of the organization and are paid in cash,

and in kind. The latter denotes a longer-term

payoff that perpetuates an extended view and

encourages conformity.

Several primary groups are involved in the

construction process; each has its own system

of rewards. One company may be on a growth

curve and wish to obtain follow-up business as

a primary reward. Another may be in a cash-

flow bind and require of the owner immediate

payback. The reward system may be geared to

another corporate need.

The profit motive theoretically presses all

participants to operate at their optimum level.

In this regard, the construction project can be

the arena for competitive groups that are all

fighting to optimize performance, sometimes at

the expense of other participants. Rewards

have the potential to be a major cause of dis-

ruptive conflicts.

The systems of rewards for those who design

and build projects have been described as being

divided between the immediacy of the project

and the same distant payoffs their counterparts

in other industries enjoy. More emphasis, how-

ever, is placed on shorter term results in con-

struction, and the reward system is heavily

skewed in that direction. The motivation to

obtain rewards on a construction project may

produce even greater potential for conflicting

issues.

Life Expectancy. Most organizations aredesigned to have a life of infinite duration,

requiring a process of continuity and stability

that causes the organization to build-in objec-

tives, plans, actions, and controls in order to

bridge the future.

A major construction project has an average

life span of between two to five years; 26

months is a more common duration. The short-

term nature of the project requires a rapid

assembly of all resources necessary to complete

the job. Everyone is constantly aware that thesituation is absolutely temporary and will end

in the not too distant future. The closest com-

parison to an organization of this type is a mili-

tary task force.

Key Players. In other organizations, key

players are captive to the parent organization

where demands of loyalty, fealty, and obedi-

ence to rituals of the bureaucracy are required.

27


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Table 3 Comparison of Construction Culture

Objectives

Construction Other

1. Many companies: varied objectives. 1. Tends to be centralized, homogeneous, top-

2. May be schedule, profit, cost, safety, profes- down driven.

sional credo or liability, long or short. 2. Differences are reconciled by single authority.

3. May be conflicting-adversaries. 3. Clear, non-conflicting and controlled.

Rewards 1. Different rewards, depending on organization. 1. Tied to objectives.

2. More short-terms.2. Paid in cash and career path payoff.

3. May be conflicting; see objectives. 3. Collective incentives.

4. More uncertainty. 4. Many performance measures.

Life Expectancy 1. Short-term from beginning to end. 1. Infinite duration.

2. Very little continuity, learning as a team. 2. Stable, predictable.

3. Accelerated mobilization, organization, tem- 3. Continuity, long-term corrections of prob-

porary values and philosophy. lems.

Key Players 1. Loyal to diverse organizations, thus divided 1. Captive to parent organization.

as a team. 2. Trained and conditioned to play company

2. Chosen on availability and technical exper- game.

tise. 3. Vision on company objectives, rewards,3. View may be on short-term project objectives long-term progress.

and conflicting.

Structure/

Linkage

1. Organization structures are complex and 1. Chart of organization establishes clearer lines

often conflicting. of authority.

2. Networks are extensive. 2. Lines of power clear.

3. Varied and complex linkages among organi- 3. Fewer networks.

zations.

Systems/Procedures 1. Formulated from several sources; may be

conflicting or duplicating.

2. Systems may be incompatible.

3. Controls may differ widely.

1. Formulated from single sources.

2. Integrated and reinforcing.

3. Administered by stable support staffs.

28Time and Space 1. Time-driven schedules.

2. High risk environment.

3. Tentative special relationships.

1. End-date driven; pressure less.

2. Probability of lower risk environment.

3. More certainty and stability in special alloca-

tions and usages.


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Some promise also exists that a contributing

member of a successful organization will be

rewarded with more responsibility, longevity,

and higher position. In construction projects,

several organizations are represented; the loyal-

ties of the teams go back to their parent organi-

zations. Thus, team loyalties are divided and

often conflicting.

Hopefully, the Owners Project Manager

will be chosen on the basis of expertise in

directing construction projects. The OPM must

be acceptable to the Pro jec t Execut ive, whomust have sufficient influence in the owner

organization to support the efforts of the

Owners Project Manager.

The designer basically has the same deci-

sions to make as the constructor in selecting a

project manager. If a construction manager is

required, a similar process is followed. Little

control is exercised across organizational lines,

unless the owner insists on selecting partici-

pants. In the final analysis, the key players on

project teams usually are chosen by their ownproject sponsors. The decisions are based on

the needs of the separate organizations.

Structure and Linkage. Organizational life

usually means parceling out responsibility,

authority, and accountability. These routine

delegations become a flow of lines and blocks,

which are known as organizati

organizing for project success

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