Transcript 3.0 Cost Management

Presented by: [name]
[date]
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Overview of CMAA’s Standards of Practice
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Benefits of attaining CCM credential
The practice of professional management
applied to the planning, design, and construction
of projects from inception to completion for the
purpose of controlling time, scope, quality and
cost.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
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Establishes industry standards
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Serves as a guide to range of services
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Does NOT limit methods and procedures
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Is delivery system neutral
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Introduction
Project Management
Cost Management
Time Management
Quality Management
Contract Administration
Safety
Program Management
Sustainability
Risk Management
Building Information Modeling (BIM)
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Construction Management defined
o is the practice of professional management applied to the planning, design, and
construction of projects from inception to completion for the purpose of controlling
time, scope, cost, and quality.
o the application of integrated systems and procedures by a team of professionals to
achieve the owner’s goals
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10 functions that are not mutually exclusive, but are related and integral components of
the Construction Management process presented in the following phases:
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Pre-Design
Design
Procurement
Construction
Post Construction
Key Definitions relevant to Construction Management
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Project Management
o Key components of a Project Management Plan and its development throughout the
various project phases. In general terms it outlines key goals and elements of
managing a project under the Construction Management format
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Cost Management
o Guidelines for the CM to assist the team members in managing, controlling, and
monitoring project costs during all phases of a project through an integrated and
comprehensive cost management system.
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Time Management
o An integral part of the CM’s responsibilities on a project. This responsibility is met
when the CM makes the most effective use of people, equipment, materials, and
funds relative to time.
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Quality Management
o Key goals, philosophies and elements of providing services while enhancing quality in
the planning/design/construction process, the Construction Management services
and ultimately, in the constructed facilities.
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Contract Administration
o Addresses the administrative tasks of the CM during project execution and the
administration and reporting requirements for all construction contracts.
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Safety
o Focuses on the subject of providing safety management services to the owner if so
required by the owner.
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Program Management
o Discusses Program Management which, in the context of the construction industry, is
the application of Construction Management to large, complex or multiple capital
improvement projects.
o A Program Manager (PM) is generally assigned the responsibility of managing all of
the resources and relationships necessary to achieve an owner's desired outcome.
o Depending on the owner’s organization and needs, Program Management services
may be provided by in-house personnel or contracted to a qualified consultant
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Sustainability
o Discusses the expanding subject of sustainability as it pertains to the role of the CM.
It outlines in general terms key goals, philosophies and elements of sustainability.
o The general philosophy is to be incorporated with other key elements of the
construction management plan including cost time and quality management as well
as within the Project Management Plan.
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Risk Management
o Provides the CM with a guide to a standard implementation of risk management on a
project.
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Building Information Modeling (BIM)
o Provides a brief summary of the CM’s role and responsibilities in implementing BIM
on a project by phase. The CM must also accept the following general responsibilities
related to the BIM process:
o The CM has the responsibility to stay current and remain educated on the BIM process.
o The CM has the responsibility to educate the owner and the project team on the benefits,
features, limitations and the implementation process for BIM.
o By educating its own personnel and the rest of the project team, the CM has the opportunity to
continue its leadership role in the project delivery process with appropriate application of BIM.
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Project Management
Cost Management
Time Management
Quality Management
Contract Administration
Safety
Program Management
Sustainability
Risk Management
Building Information Modeling (BIM)
© Construction Management Association of America. Do Not Duplicate or Reproduce.
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Pre-Design*
Design
Procurement
Construction
Post-Construction
*optimum time to engage CM
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CMAA Capstone: History of Construction
Management
CM Standards of Practice, 2010 Revision
CMAA Contract Administration Procedures
CMAA Cost Management Procedures
CMAA Quality Management Guidelines
CMAA Time Management Procedures
CMAA Sustainability Guidelines 2010
Model Contract documents
◦ CM At-Risk
◦ CM Agency
© Construction Management Association of America. Do Not Duplicate or Reproduce.
As qualified to a construction project,
the use of integrated systems and
procedures by the project team to
accomplish design and construction.
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Construction Management Plan
Project Procedures Manual
Quality Management Plan
Procurement Plan
Contracts or Agreements
Laws
Standards of Care
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The CM plays a key role in Cost Management during all phases of a
construction project: planning, design, bid/award, construction, and
closeout
The CM is the cost professional on the project
Cost management must be established and implemented at the outset
and continued throughout the project
CMAA procedures intended to help the CM with this role
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Objectives
◦Control Cost
◦Deliver within Budget
CM’s Role in Cost Management
◦Cost Management Plan (CMP), aka Project Money Plan
◦Deliver within Budget
Financial forecast
Control project costs and cash flow
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Cost Control Responsibilities
•All communications must include the CM
•CM must attend all meetings
•CM must report accurately and regularly to the Owner
•CM must ensure that the project is delivered in the most economical
way conforming to project requirements
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•CMs most often cite delivering projects on time as their biggest
challenge
•Time has the least amount of flexibility; it passes, no matter what
•Schedule issues are one of the main reasons for conflict on
projects
•Accurate, initial schedule development and continued ongoing
maintenance is paramount to:
•Avoiding claims
•Providing a solid basis for quantifying time impacts
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Essentials CM needs to manage:
- Sufficient level of detail
- Inflated durations to hide float
- Logic ties to hide true critical path
- Missing or incorrect logic
- Arbitrary milestones: non-logic driven
- Open-ended activities
- Primary and secondary critical paths
- Phasing
- Regulatory requirements
- Code compliance / inspections
- Long lead procurement items
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Changes/Claim Process
CHANGE ORDERS & CLAIMS
•Schedule status prior to change
•Change Fragnet: Check Logic & Durations
•Recovery
REVISED SCHEDULE
•Run original, and revised schedules until approved
•Tie to change order and negotiations
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To Manage Project Time/Resources/Cost
Good Schedule, Accurate Forecasts
To Integrate Multiple Parties
Owner, Contractor, User, Community
To Evaluate Options
Changes, Delays, Acceleration
To Resolve Disputes
Arecibo Space Telescope, Puerto Rico
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Quality - Can be subjective
Quality Control - Contractors responsibility
Quality Assurance - CM’s responsibility
Quality Management - Encompasses all aspects
of quality
 Quality Management Plan – a team responsibility
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A project specific, written plan, prepared for certain projects which
reflects the general methodology to be implemented by the CM
during the course of the project – to enhance the Owner’s control of
time, cost, and quality through a process-oriented approach to the
various management tasks for the program
- Understanding of roles
- Control time, cost, and quality
- Should be done early in the project
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Retainage as a quality tool
Format for authorizing extra work
Partial payments
Withholding payment
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A real QA issue
Various methods available
Propose and agree upon the process early,
but most importantly…
Establish the mind-set about
the desired / expected quality
of the work
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Objectives are to control:
- Time
- Cost
- Quality
- Information
- Safety
© Construction Management Association of America. Do Not Duplicate or Reproduce.
 Develop the following:
- Construction Management Plan
- Project Procedures
- Management Information System
- Quality Management Plan
- Communications Procedures
- A master schedule, a milestone schedule
 Identify possible project delivery methods
 Manage designer selection / contract form
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 Organization
 Project Documentation
 Tracking and follow-up
 Software utilized
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Employee Safety and Health
- Safety program / accident prevention program
- Management and employee accountability
- Safety orientation
- Hazard recognition and awareness training
• Usually, the contractor provides “safe” access to
the work for inspection
- Employee guidelines for handling safety issues
© Construction Management Association of America. Do Not Duplicate or Reproduce.
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Management commitment
Accountability
Employee buy-in
Hazard communication
Safety should be equal to current programs
Establish a safety committee to help
develop the plan
© Construction Management Association of America. Do Not Duplicate or Reproduce.
In the context of the construction industry,
program management is the application of
Construction Management to large, complex or
multiple capital improvement projects.
© Construction Management Association of America. Do Not Duplicate or Reproduce.
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Owner’s road map to success
Defines vision, strategy, schedule and budget
criteria, policies, procedures and standards.
Provides a level of continuity and standardization
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Common features of a sustainable project
Customize construction management tools for a
project with sustainability goals and
requirements
Sustainability Plan
Sustainability Review
CM leadership to achieve a project’s
sustainability goals and requirements
Evaluate the effectiveness of management
systems in achieving a project’s sustainability
goals
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Risk Identification
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Include those with most project knowledge
Facilitate open thinking during identification
Identify potential impacts of risks identified
Keep expectations realistic
Develop a tracking report (Risk Register)
Risk Analysis
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Likelihood
Severity
Categories risk element
Establish accountability
Prioritize efforts
Synthesize risk
Communication and Reporting
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Tracking
Mitigation
Resolution
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Avoidance
Mitigation
Transfer
Acceptance
A process by which a representation of physical
and functional characteristics of a facility are
captured in a digital model, analyzed,
documented, and assessed virtually, then revised
iteratively through the design and construction
process
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Can vary significantly from project-to-project based
on the extent of adoption of the BIM process and the
selected project delivery method
At the project outset, the CM must guide the project
team in the selection and adoption of the most
appropriate and best-fit BIM approach based on:
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Project Characteristics
Owner Buy-in
Project team Capabilities
Cost-Benefit Considerations
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To fulfill his/her role and meet his/her responsibility
through the project, the CM must:
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Stay current on the BIM process
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Educate the Owner and project team on the benefits,
features, limitations of BIM
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Maintain its leadership role in the project delivery
process with appropriate application of BIM
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Have clear communication with the stakeholders during
the implementation of BIM
Person who has met prescribed criteria of the CCM
program relative to:
◦ Formal education and general construction
industry experience
◦ Documented, successful Construction
Management experience
◦ Demonstrated capability and understanding of
CMAA Body of Knowledge
Defines its own Standards of Practice and values
Identifies those best qualified to practice
Construction Management
Offers an assurance of quality to those who
employ Certified Construction Managers
The “Culture of Certification” describes a business
environment in which it is simply assumed, at all
levels, that the best and most committed
Construction Managers will be CCMs, and in which
organizations actively and consistently support
their people in obtaining and maintaining their
credentials.
Increasing numbers of organizations, both owner and service
providers, are adopting this outlook and focus
Increased professional stature & marketability
Creates opportunity for advancement
Adds value for both employer and client
Tells owners, employers and peers you are a
recognized professional.
 Employers rewarding achievement with bonuses and
salary adjustments
 Access to professional community to network with
other CCMs
 Continuing professional development required to
maintain credential
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 Independent assessment of CM staff knowledge
and skills based on national standards
 National certification means “portable”
credentials
 Improved company marketability
 Your employees continue to improve
 Owners increasingly giving formal preference in
evaluations
 First Industry Professional Certification
Program to Achieve ANSI/ISO/IEC 17024
Personnel Certification Accreditation by the
American National Standards Institute (ANSI)
 Process and Procedures Adhere to an
International Standard of Excellence that is
mobile and in the Interest of Public Welfare
 Provides Assurance of Legitimacy
© Construction Management Association of America. Do Not Duplicate or Reproduce.
Must have 48 months Responsible-In-Charge(RIC) experience
as a CM/PM as shown on Qualification Matrix AND one of the
following:
 4-year Degree from an Accredited Educational Institution
 Construction Management, Architecture, Engineering (mulitiple
disciplines), or Construction Science
 Accrediting body recognized by CHEA or the US Dept. of
Education
 2-year Degree & 4 years experience in general
design/construction
 8 Years experience in general design/construction
“Did the decisions that the candidate was
empowered to make directly impact the
successful completion of the project and
was the candidate directly responsible in
charge of construction management
services and for protecting the interests of
the project and the owner?”
PHASE:
Pre-design
Design
RIC
RIC
Procurement
Construction
Post-construction
FUNCTION/ ROLE
Project
Management
RIC
Cost Management
RIC
Time Management
RIC
RIC
Quality
Management
RIC
RIC
RIC
RIC
RIC
Contract
Administration
Safety
Management
RIC
RIC
RIC
RIC
Minimum Total of 48 months cumulative experience required in these
RIC Experience > Phases & Function/Roles
CMAA
Contact
Kate Brundage
Certification Manager
7926 Jones Branch Drive, Suite
800
McLean, Virginia 22102 USA
Tel: 703.356.2622 Fax:
703.356.6388
[email protected]
Dennis Doran
VP, Professional Development
7926 Jones Branch Drive, Suite
800
McLean, Virginia 22102 USA
Tel: 703.356.2622 Fax:
703.356.6388
[email protected]