another brick in the wall understanding construction management
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Another Brick in the Wall Understanding Construction Management. By: John Knox, Vice President The Chamberlain Companies. Presentation Process. Explain the differences Discuss how these differences affect clients Examine the benefits/challenges of Construction Management - PowerPoint PPT PresentationTRANSCRIPT
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Another Brick in the Wall Understanding Construction Management
By: John Knox, Vice PresidentThe Chamberlain Companies
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Presentation Process• Explain the differences• Discuss how these differences affect
clients• Examine the benefits/challenges of
Construction Management• 15-20 minutes for question/answer
period at end of presentation
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Construction Management Construction Management is a concept Construction Management is a concept
which integrates the design and which integrates the design and construction processes. It joins the construction processes. It joins the Owner, Architect, and Builder into a team Owner, Architect, and Builder into a team to produce a facility which to produce a facility which bestbest meets the meets the functional requirements and aesthetic functional requirements and aesthetic needs of the Owner within the authorized needs of the Owner within the authorized budget and occupancy schedule. budget and occupancy schedule.
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Construction Management (CM)• Not Project Management• A contractual agreement for the construction
of a project• Unlike General Contracting and Design/Build,
CM is an “open book” method• GC’s profit and overhead are included in his
“stipulated sum” price• Construction Manager paid a negotiated fixed
fee or percentage of construction cost• Team Approach - CM hired early in the
process to develop schedule and cost estimates, and provide input during design process
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Stipulated Sum vs. Open Book• Stipulated Sum
– Lump sum amount quoted for the construction of a project
– Examples are General Contracting and Design/Build
• Open Book– All construction costs are disclosed openly
to the Owner– Transparent process with Owner actively
involved in award of contracts
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Construction Divisions• Div. 1 – General
Requirements (Site Super, Labour, Fencing, Insurance, etc.)
• Div. 2 – Site Work• Div. 3 – Concrete• Div, 4 – Masonry• Div. 5 – Structural Steel• Div. 6 – Wood & Plastics• Div. 7 – Thermal &
Moisture Protection• Div. 8 – Doors & Windows
• Div. 9 – Finishes• Div. 10 – Specialties• Div. 11 – Equipment• Div. 12 – Furnishings• Div. 13 – Special
Construction• Div. 14 – Conveying
Systems• Div. 15 – Mechanical• Div. 16 - Electrical
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So, While there is no difference in Construction Means and Methods
The difference lies in ..The difference lies in ..
• PhilosophyPhilosophy• ContractContract• ControlControl
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Philosophy - CM• A portion of his fee is for pre-construction
services during the design phase• Questions architectural decisions along the way
with the focus on value• The Construction Manager – Advisor during
design stage and the Owner’s Representative during the construction stage
• Less chance of dispute with Owner or Architect as CM involved in design process, and does not profit from omissions or changes
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Philosophy - GC• Design – Bid – Build Process. GC not
involved until design process completed• His only responsibility is to build what
was tendered• GC will price and produce exactly what
is shown on drawings. Grey areas, omissions, or changes are all opportunities for profit
• Relationship between Owner, Architect, and GC can become confrontational when problems occur
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General Contracting
Control of the Site
CLIENT
ARCHITECT GENERALCONTRACTOR
ENGINEERS SUBTRADES
CONSULTANTS SUPPLIERS
Contract Control
• Working drawings and specifications completed and all divisions tendered as one package to General Contractors
• Contract between Owner and General Contractor
• General Contractor has contracts with each of the Trade Contractors
• GC’s Site Super manages Site and Trade Contractors
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Construction Management
Control of the Site
CLIENT
ARCHITECT CONSTRUCTION MANAGER
ENGINEERS
CONSULTANTS
SUBTRADES
SUPPLIERS
Contract Control
• Divisions divided into tender packages, drawings & specifications for each package completed, and tendered individually and sequentially
• Owner contracts directly with Trade Contractors
• CM’s Site Super manages Site and Trade Contractors
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Construction Management by Architect
CLIENT
ARCHITECT CONSTRUCTION MANAGER
ENGINEERS
CONSULTANTS
SUBTRADES
SUPPLIERS
Contract Control
Chamberlain regularly performs both roles – Architect and Construction Manager
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Greatest Risks on aConstruction Project are …
• Unknown conditions• Facility not meeting
expectations• Bankruptcy of Constructor• Exceeding the budget or
schedule• Inclement weather
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Client Concerns• Risk Exposure
– Control over Site, Costs, and Schedule
• Flexibility– Deal with unexpected situations– Ability to make changes without
paying a premium• Image • Value• Cooperative Team Relationship
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Risk is Minimized by Risk is Minimized by Maximizing Maximizing ControlControl and and
FlexibilityFlexibility during the Construction during the Construction
ProcessProcess
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Control
• Owner contracts and is dealing directly with the Trade Contractors
• He who pays the piper calls the tune
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Flexibility• Possible to start construction before
design finalized– Owner has a longer time to determine
specific requirements because packages sequentially tendered
– Good for fast tracking a project• Establishes project cost early• Owner doesn’t pay a premium for
changes• Allows for continued operation during
construction• Allows for incorporation of donated
materials/labour• Allows for inclusion of local
trades/suppliers
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Reality of Stipulated Sum Contracts•Price is indicative of the opportunity at that moment in time
•Price only fixed if absolutely nothing changes during construction
•Generally, the GC is forced to use lowest trade/supplier prices to get the job
•100% price driven
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The Bottom Line
The price shown on a Stipulated Sum Contract is the least you are going to pay for your building not
the most.
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Div Sub Trades GC #1 GC #2 GC #3 LowestCM
1 GENERAL 132,318 133,400 132,600 132,3182 SITE WORK 306,334 272,585 304,384 272,5853 CONCRETE 37,508 42,775 26,594 26,5944 MASONRY 44,261 42,000 41,099 41,0995 METALS 72,522 77,049 107,099 72,5226 WOOD & PLASTICS 47,015 42,244 53,681 42,2447 THERMAL/MOISTURE 56,768 64,798 68,186 56,7688 DOORS/WINDOWS 88,275 88,905 85,462 85,4629 FINISHES 141,916 135,016 133,974 133,974
10 SPECIALITIES 27,508 28,682 36,411 27,50814 CONVEYING 28,261 27,535 29,274 27,53515 MECHANICAL 176,606 215,959 188,847 176,60616 ELECTRICAL 173,394 177,699 180,811 173,394
TOTAL: 1,332,686 1,348,647 1,388,422 1,268,609
Value
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Savings Accrue to Owner
Item Budget Tender Savings
Site Work $300,000 $276,000 $24,000Donated Material $5,000Deleted Doors $2,000
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Challenges of Construction Management
• Owner more involved in construction process
• More paperwork – construction draws to be approved under guidance of Construction Manager
• Upside – complete paper trail for all monies spent on the project and an excellent opportunity to learn about the design and construction process
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Projects built under Construction Management
Canadian Warplane Heritage Museum
Air Traffic Control Tower, Toronto Pearson Int’l Airport
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Lincoln Public Library, Rittenhouse Branch
Shelburne Public Library Addition & Restoration
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Niagara-on-the-LakePublic Library
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Quinte WestCity Hall/Public Library
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Other Projects
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To Re-cap…General Contracting Construction
Management
Design Involvement None Involved early in planning & budgeting
Building Team Structure Prime Contractor Advisor/Agent to Owner
Accounting Disclosure None Open Book
Paperwork Less More
Risk Exposure if Contractor(s) go broke
High Very Low
Relationship with Owner Minimal interaction with Owner. Works through
Architect
Works closely with Owner
Site Control None Full
Flexibility to Make Changes
Extra cost at full premium
Actual cost
Savings Realized Go to GC Go to Owner
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Wrap Up…• Able to fast track, if necessary• Early establishment of project costs• Cooperative relationship – less
stressful for Owner• Provides Owner with more Control
and Flexibility during construction• Realizes best Value for Owner
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Another Brick in the Wall Understanding Construction Management
By: John Knox, Vice PresidentThe Chamberlain Companies