CMPROMGT -MODULE 1 - CHAPTER 1 • Mostly public financing or large consortium

Construction Project Organization • Highway & Bridges

• Railroads & Urban Transit Systems
Overview of the Construction Industry • Tunnels and Dams
• Average of 5.2% to GDP • Airports
• Employs over 10,000,000 workers • Canals
• Annual Volume exceeds 200 billion PhP • Port & harbor structures
• Vital to the Nation’s economic health and quality • Pipelines
• Sewer Systems
Industry Divisions • Water treatment & distribution systems
1. Residential Construction • Power & communication networks
2. (Institutional & Commercial) Building • Landfills
Construction • Mass quantities of basic materials: earth, rock,
3. Heavy Construction steel, timber, and concrete
4. Industrial Construction
• Constructors need knowledge of engineering and
geology
Residential
• Engineers and builders are often specialized
• Types
• Greatest impact on land and water
- Single family houses
• High degree of mechanization
- Multifamily dwellings
• Contracts awarded through competitive bidding
- High-rise apartments & condominiums
• 30-35 % of the industry Industrial Construction
• Low capital and technology requirements • Very large-scale projects
• Largely private • High degree of technological complexity •
• Often speculative Designed and built by the largest firms with the
• Developers highest level of technical sophistication
• Designed by architects, builders/developers. • Represent 5-10% of the market
• Petroleum refineries
Building Construction • Steel mills & aluminum plants
• Institutional and Commercial Construction • Chemical processing plants
- Schools and universities • Fossil fuel & nuclear power plants
- Medical clinics and hospitals • Other heavy manufacturing facilities
- Recreational facilities and sports stadiums • Complex mechanical systems, process piping,
- Retail stores and shopping center and instrumentation
- Warehouses and light manufacturing • Civil, but also mechanical, chemical, and
- Office buildings (single story electrical engineering disciplines involved •
to skyscrapers) Mostly private ownership (in western
- Hotels, convention centers, and theaters countries)
• Negotiated contracts are typical
• Institutional and Commercial Construction • “Turnkey” contract arrangements are common •
- Churches and Synagogues Design-constructor must be intimately familiar
- Prisons with the technology and operations of the facility
- Courthouses and other government buildings ____________________
• 35-40 % of construction market
• Larger and more complex than residential Problems Facing Construction Industry:
• Various owners (mostly private) • Highly traditional and fragmented; slow to
• Designed by architects and engineers embrace new technology
• Restrictive/outdated building codes
Heavy Construction • Labor agreements and craft jurisdictional issues
• Horizontal Construction • 20-25% of the • Liability and legal considerations
construction industry • Lack of profit motive or other incentive
Watch: Philippines Construction 4. Philippine Domestic Construction Board
https://www.youtube.com/watch?v=sOaxVy7rhi 5. Construction Industry Arbitration Commission
o (CIAC)
6. Construction Manpower Development
Participants in the construction Project Foundation (CMDF)
1. Owner / Client
• Private or public 4. Construction Manager
• Conceives the construction project Two principle divisions of CM
• Increasing level of sophistication Classification of • CM for Fee (management services only)
Clients Sector: • CM At Risk
• Public owners consist of national and local - Operates similarly to a GC or DB with no
government agencies or units tasked to labor or capital equipment.
implement construction projects intended either • Can encompass the management of the
for public use (roads, bridges, ports, dams, parks, design process as well as construction.
and similar works) or for public service • CM services including inspection and overall
(government buildings and other facilities or project or program management.
structures for the development of the national
wealth). 5. Suppliers
• Private owners on the other hand, are non- • Manufactures, distributors, research,
entities requiring services for residential, promotions
commercial, and/or industrial construction. • Materials and equipment sales
• Public-Private Partnership (PPP) has become • Equipment Rental
popular w/c tends to be subject to the rules and
regulations governing public ownership since the 6. Fabricators
partnership is typically used as a means to • Structural steel, pre-castors, wood
procure private financing for a public project. products

2. Designer 7. Labor/Trade Unions

• Architects
- Size of firms ranging form single 8. Government
practitioner to large integrated firms Two major types of governmental project owners:
- Mostly building and residential 1. Infrastructure Agencies - are those whose
construction primary function is to provide (either by
• Engineers contract or by direct administration) the
- Civil, mechanical, structural, necessary public works or facilities within their
electrical,chemical,environmen tal, areas of responsibility.
geotechechnical, and multidiscipline.
The bulk of public construction projects are
3. General Contractor • General contractor also called implemented by three major infrastructure agencies:
“Prime” contractor 1. Department of Public Works and Highways
• Specialty contractors working as subcontractors (DPWH),
• Organization ranges from small, oneperson 2. Department of Transportation (DOTr), and
company to large, integrated A/E/C firms 3. Department of Energy (DOE).
• Part of a design-build team
Under these three agencies are several offices and
The following agencies are formed to regulate government corporations also classified as
contracting business: infrastructure agencies. These include the:
1. Construction Industry Authority of the • National Power Corporation (NPC)
Philippines (CIAP), • National Irrigation Administration
2. Philippine Contractors Accreditation Board (NIA)
(PCAB) • National Electrification Administration (NEA)
3. Philippine Overseas Construction Board (POCB) Philippine Ports Authority (PPA)
• Local Water and Utilities - Industrial projects or institutional (such as
Administration (LWUA) hospitals or schools
• Bureau of Air Transportation (BAT),
• Philippine National Railways (PNR), Owner-managed construction
• Light Railways Transit Authority (LRTA). - Residential/commercial building developers
• National Housing Authority (NHA) - Industrial or institutional

Most of these agencies have decentralized organizational Construction by General Contractor

structures which allow for infrastructure planning and • Also referred to as “Prime Contractor”
delivery at the regional and district levels. • Most common method of delivery
• Contractor bears substantial risks and financial
9. Utility Company responsibility
• Electric, communications, water, gas, sanitary • Facility designed by in-house architect/engineer
sewer or by design
• Private petroleum pipelines consultants
• Owner or service provider Often requires specialty subcontractors
• Integral part of the process
• Existing facilities in conflict with new Specialty contractors might include those specializing in
construction one of the following:
• Interruption of service can be very costly. • Excavation
• Steel erection
10. Industry Associations • Concrete
• Organizations of construction contractors - Cast-in-place
• Organizations of the design and - Prestressed/Precast
management professions • Masonry
• Construction material and equipment suppliers • Timber/wood framing
and product research • Piping/plumbing
• Construction labor organizations • Clearing and grubbing
• Coordination and arbitration • Blasting/demolition
• Inspection, specifications, and costs • Electrical
• Painting
Functions and services • HVAC
• Industry information and communication • Environmental
• Development and maintenance of • remediation
standards • Many, many others
• Industry coordination
• Collective bargaining Design-Build (Turnkey)
• Statistics (market & industry) • Single firm or team responsible for design and
• Meetings and conventions construction minimizes coordination problems
• More efficient designs with the interjection of
____________________ constructability and innovation
• Often employs fast-track construction
Project Delivery Organization • Benefits include reduced overall delivery time
• Construction by owners forces and “one-stop shopping” for the owner
• Owner-managed construction • Disadvantages include complexity of evaluating
• Construction by general contractor proposals
• Design-build team
• CM Contract CM Contract -- Fee (management services
only) also referred to as “Agency”
Construction employing owner forces • Specialized construction skills through all project
- Usually small in-house construction or stages including preconstruction
renovations
• Provides close coordination between design and • Phase end reviews of both key deliverables and
construction project performance to date – phase exits, stage
• Eliminates impact of conflicts of interest gates or kill points.
• Independent and objective evaluation of costs,
schedules, and performance
• Potential saving in time and cost
• Disadvantages include no risks associated with
costs increase

CM Contract – “At-Risk
• CM assumes financial risks similar to a GC
• CM manages all phases of the work without
performing any actual work tasks
• CM’s only resources are management personnel
• Contractors/subcontractors have a direct
contract with CM
• Contract form is often a negotiated guaranteed Construction project phases
maximum price arrangement
• Disadvantages includes lack of
impartiality

PROJECT
Guide to Project Management Body of
Knowledge (PMBOK) by Project Management Cont…
Institute. • First, the owner must make certain preproject
a temporary endeavor undertaken to provide a decisions. Then the planning and design of the
unique product or service. project is carried out.
• Next, the contractor is selected, after which the
PROJECT Contd… contractor mobilizes in order to carry out the
ISO 10006: 2017 defines project as: field operations.
A unique process consisting of a set of • The field work which is often considers to be
coordinated and controlled activities with start and ‘construction’ can beconsidered a separate
finish dates, conforming to specific requirements, phase.
including constraints of time, cost • Lastly, the project must be terminated and
and resources brought to a close; because these activities are
distinct from the installation work, we separate
WHAT IS A PROJECT? them into a distinct, final phase.
• “A project is a problem scheduled for solution.”
This definition forces us to recognize that Phase 1: Pre-project phase
projects are aimed at solving problems. • At this stage the owner will decide;
• A problem is a gap (achieving your objective) - what sort of project delivery system will be
between where you are and where you want to used
be, and that failure define the problem prevents - How will the various parties be related?
easy movement to close the gap. - Will the owner engage a design professional
to prepare plans and specifications and then
LIFE CYCLE OF A PROJECT contract separately with a construction
Project – divided into several phases – collectively, contractor? Or, will a single entity be
project phases known as project life cycle responsible for the entire project?
• Each project phase marked by completion of one - The other primary decision required by the
or more deliverables. owner early in the project relates to the type
of contract to be used with the contractor
• The owner will also need to decide the basis upon process will be invoked to limit the number of
which the design professional will be paid. tenders.
• Often these decisions are not made without • On the other side, contractors will have to
consultation and advice. • Depending upon the consider a number of factors in deciding whether
owner’s expertise and experience in they will make the effort to assemble a proposal
administering construction contracts, the owner for a particular project.
may engage a professional engineer, an architect, • The last step in this phase is the submittal,
or a project manager during this pre-project opening and evaluation of tenders, the selection
phase to advise on these important decisions. of the successful contractor and the finalization
of the construction contract.
Phase 2: Planning and design phase
• The project is fully defined and made ready for Phase 4: Project mobilization phase
contractor selection and deployment during the • At this stage, various bonds, licenses and
planning and design phase. It is convenient to insurances must be secured. A detailed
divide this phase into three stages. programme must be prepared.
• The goal of the 1st stage is to: • The worksite must be organized, with provisions
✓ define the project’s objectives for temporary buildings and services, access and
✓ consider alternative ways to attain those delivery, storage areas and site security.
objectives • The process of obtaining materials and
✓ ascertain whether the project is financially equipment to be incorporated into the project
feasible must be initiated and arrangements for labor, the
• To ascertain the above 3 factors; other essential resource, must be organized.
o various sites may be investigated
• With the completion of this phase, it is finally
o public input may be sought
time to begin the actual field construction.
o a preliminary cost estimate will be prepared
o funding sources will be identified
Phase 5: Construction Phase
o Then a final decision on whether to proceed
• In presenting the contractor’s activities on the
with the project will be rendered.
construction site, the responsibilities involve
three basic areas: monitoring and control,
• In the 2nd stage; the design professional will use
resource management and documentation and
the results of the planning efforts to:
communication.
✓ develop schematic diagrams/drawings
• Five aspects of monitoring and controlling the
showing the relationships among the various
work are important.
project components
✓ Actual schedule progress must be compared
✓ followed by detailed design of the structural,
against the project programme to determine
electrical and other systems
whether the project is on schedule
• In the 3rd stage; the design professionals prepare,
✓ cost status must be checked to establish how
in addition to the detailed construction drawings
actual performance compares with the
prepared in the 2nd stage, written contract
budget
conditions containing:
✓ An equally important part of monitoring and
✓ legal requirements
control is quality management, to assure
✓ technical specifications stipulating the
that the work complies with the technical
materials and the manner in which they shall
requirements set forth in the contract
be installed and
documents
✓ a set of other documents related to the
✓ In addition, the contractor has an important
process
role to play in managing the work safely and
in a way that minimizes adverse
Phase 3: Contractor selection phase
environmental impacts
• In anticipation of selecting a contractor, the • In managing the project’s resources, the
owner must decide whether an open invitation contractor will, first, be concerned with assigning
will be issued to all possible tenderers or whether and supervising personnel and assuring that the
only certain contractors will be invited to submit labor effort is sufficiently productive to meet
offers and whether any sort of prequalification
schedule, cost and quality goals. In addition,
materials and plant must be managed so that
these same goals are met.
• Documentation and communication: because
construction projects require large amounts of
paperwork, a special effort is required to manage
this documentation effectively.

Phase 6: Project closeout and termination phase

• Finally, as the project nears completion, a number
of special activities must take place before the
contractor’s responsibilities can be considered
Project Manager & The Scope
complete.
A project manager has a responsibility to keep
• There are the various testing and startup tasks,
stakeholders informed about the impact of scope
the final cleanup, various inspections a
changes on the project, protecting them from surprises
at the end of the job and protecting the project manager
Cont’d….
from being evaluated on original targets rather than on
• In addition, a myriad of special paperwork is
revised ones.
required, including
✓ approvals and certifications that allow the
Managerial Roles (what managers Do)
contractor to receive final payment
• Interpersonal roles
✓ a set of as-built drawings that include all
Figurehead role: Outward relationship
changes made to the original design
Leader role: Downward relation
✓ operating manuals
Liaison role: Horizontal relationship
✓ warranties and
✓ a final report
• Information Roles
• The contractor will also be responsible for
Monitor Role: Collects information about internal
transferring and achieving project records and will
operations and external events
conduct some sort of project critique and
Disseminator Role: Transforms information internally to
evaluation
everybody in the organization (like
• operator training may also be part of the
telephone swithboard) Spokemans Role:
contractor’s contractual responsibilities
Public Relation
____________________
• Decision Roles
Interpreneural Role: Initiates changes, assumes risks,
WHAT IS PROJECT MANAGEMENT?
transform ideas into useful products. Disturbance
• Project management is the planning, executing, Handler Role: Deals with unforseen problems and crisis.
and controlling of project activities to meet
Resource Allocator Role: Distributing
project objectives.
Resources
• The major objectives that must be met include Negotiator Role: Bargains with suppliers,
performance, cost, and time goals, while at the customers etc. in favor of the enterprise
same time you control or maintain the scope of
the project at the correct level. Functions of Managers
• Planning : Selecting missions and objectives.
TYPES OF MANAGEMENT Requires decision making
• Functional management involves the • Organizing : Establishing the structure for the
coordination of repeated work of a similar nature objective.
by the same people. • Staffing : Keeping filled the organization structure
• Project management involves the coordination • Directing: Influencing people to achieve the
of one-time work by a team of people who often objective
have never previously worked together. • Controlling: measuring and correcting the
activities