Transcript Chapter 5 Advanced Techniques of CPM Deception and Mystery

Chapter 5
Advanced Techniques of
CPM Deception and
Mystery
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T.L. Martin & Associates Inc.
A. The baseline schedule
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The baseline schedule
Should represent a contractor’s realistic strategy for
constructing the project and meeting all contract
requirements.
• It is to include all work activities, linked together
based:
– primarily on physical relationships
– secondarily by contractor preference
• Work activity durations are based on:
– work quantities,
– Resources, and
– reasonable production rates.
• A contractor’s estimated “means and methods” of its
bid should be similar to the baseline schedule.
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The baseline schedule
An accurate baseline schedule is an
extremely useful tool.
• It is the basis for many important
decisions:
– owner, contractor and subcontractor
commitments,
– Financial and cash-flow requirements
– personnel, material and equipment
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The baseline schedule
• Specialty subcontractors should develop an activity
list with estimated work quantities, key resources and
anticipated productions.
• The owner should also provide the general contractor
anticipated work lists for which it assumes
responsibility with appropriate durations.
• The general contractor then takes this information
and develops a proposed as planned project CPM
schedule.
• This proposed schedule should first be reviewed by
specialty contractors.
• The contractor’s finalized baseline schedule should
then be reviewed and approved by the owner and/or
its representatives.
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The baseline schedule
• The baseline CPM schedule has significance since it
may be used to prove delay to project completion.
• Contractors use it as a basis to claim damages due
to alleged owner interference, delays and/or directed
acceleration.
• Owners uses it to help defend against such claims.
(A baseline schedule may include some very
deceptive tricks.)
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The baseline schedule
Tricks and Traps
• A contractor under-resources the baseline schedule.
– Stop an owner from rightfully complaining that the
project is being delayed due to contractor failure to
resource the job correctly.
– The under-resourced scheduled may also set up
an owner for an acceleration claim, with damages
computed as the difference between the baseline
and what was actually expended.
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The baseline schedule
Tricks and Traps
• Another favorite trick is to improperly prolong
some work and cause follow-on activities to
be crowded into an unrealistic performance
periods.
• This often creates many critical activity paths
during the crowded period, with high risk of
completion delay.
– The owner and contractor incorectly will
not view problems early-on as detrimental
to overall project performance.
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The baseline schedule
Tricks and Traps
• Improperly prolonging some work and causing followon activities to be crowded into an unrealistic
performance period often backfires.
• The Owner takes advantage of available float in early
work
– Delays to foundations,
– Late owner furnished equipment and/or materials,
– Late designs for follow-on work,
– Will not appear critical, resulting in no entitlement
to additional time for contractor performance.
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The baseline schedule
Tricks and Traps
• A contractor may attempt to create many critical
paths through a project’s CPM network.
• This however becomes a double-edged sword if the
contractor causes a delay along one of the critical
paths.
• The more probable result with multiple critical paths
is concurrent delay. Both owner and contractor
problems delay critical path work, which generally
results in a non-compensable time extension for the
contractor.
• Thus, an unrealistically crowded period in a CPM
schedule harms both the contractor and the owner.
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Key Issues to Watch Out for in the
Schedule Development Process
Typical problems encountered in the Baseline
Network
• Inadequate number of activities and missing work
activities
• Excessive activity durations
• The use of vague logic and missing logic ties for key
relationships
• The use of manpower restraints and preferential logic
conditions which cause critical or near-critical paths
• Excessive number or unreasonable constraints
• Failure to include “ordinary” weather days
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Key Issues to Watch Out for in the
Schedule Development Process
•
•
•
•
Control and abuse of float
Owner durations for various approvals
Front-end cost loading
Deferring major features of work toward the
end of the project and not taking advantage
of the opportunities that exist
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B. Updating the project
schedule
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Updating
• Update - The process of incorporating actual
event documentation into the baseline schedule
or current approved schedule to forecast how
the actual progress of the work compares to the
plan
• Should be required with every pay requisition or
at least monthly
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Update
• Why Update a Schedule
– Document and record actual progress
– Determine status of the job relative to
completion or interim milestones
– Establish an accurate benchmark for
payment- “earned value”
– To provide current activity start and
finish dates
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The Data Date
• DATA DATE - The first working day
after the reporting period
• Generally at the end of the month to
coincide with billing cycles
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Goals of a Schedule Update
• To limit surprises
• To preserve an accurate record of
progress
• Accurately determine reasonable payment
• Forecast project completion or key project
milestones
• Calculate the impact of progress (or lack
there of) in the previous period
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The Schedule Update Process
• Contractor develops a pencil copy
• Must accurately reflect both:
– Value of work in place based on actual
quantities installed
– Required time to complete remaining
work.
• Allow review of activity percent complete
and resource percent complete.
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The Schedule Update Process
• A key area of trickery involves revisions to logic or lack
there of, during the update.
• Major revisions to activity sequences with impacts to
critical work and/or causing previously non-critical work
to become critical, require special review and
understanding.
• Owner responsible changes should be added to the
CPM schedule during the updating process, based on
agreed to fragnets.
• The insertion of added or changed work into the CPM
during the updating process should be done based on
quantities of work, realistic resources and associated
production rates.
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The Schedule Update Process
• KEY ITEMS TO REVIEW (for Trickery)
• Calculation Setting
– Retained Logic vs. Progress Override
vs. Actual Dates
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The Schedule Update Process
• KEY ITEMS TO REVIEW (for Trickery)
• Calculation Setting Impact.
– Retained Logic vs. Progress Override
vs. Actual Dates
– Start to Start Lag Calculations
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Start to Start Lag Calculations
As Planned
2
10
2
10
Based on Early Start (of Remaining Duration)
5
2
Based on Actual Start
2
2
5
2
10
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10
The Schedule Update Process
• KEY ITEMS TO CHECK (for Trickery)
• Calculation Setting Impact.
– Retained Logic vs. Progress
Override vs. Actual Dates
– Start to Start Lag Calculations
– Contiguous vs. Interruptible
durations
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Contiguous vs. Interruptible Durations
1
8
8
FF 2
7
SS 2
10
4
1
8
8
FF 2
SS 2
3
10
4
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The Schedule Update Process
• KEY ITEMS TO CHECK (for Trickery)
• Calculation Setting Impact.
– Retained Logic vs. Progress Override vs. Actual
Dates
– Start to Start Lag Calculations
– Contiguous vs. Interruptible durations
– Start vs. Finish vs. Most Critical Total Float
Calculations
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The Schedule Update Process
• KET ITEMS TO CHECK (for Trickery)
• Calculation Setting Impact
• Verify dates are not leveled or
limited
• Review Out-of-Sequence work
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Out of Sequence Progress
As Planne d
2
Excavate (5)
2
2
Form (7)
3
Re bar (4)
Pour
1
This s ituation indicate s
that a proble m e xis ts
that m us t be fixe d to
ge t an accurate update
Update
Excavate
Form
2
Pour
2
{
Rebar
Data
Date
1 day gap equal to
lag duration from
rebar to form
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C. Manipulation of delay
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Manipulation of delay
• The insertion of owner responsible issues
into a CPM schedule can result in
misleading criticality.
• This will occur if the added or changed work
is put into the plan based on preference,
rather than physical dependency.
• Key resource constraints should be reviewed
by both the contractor and the owner.
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Manipulation of delay
• The insertion of added and changed work is subject
to all of the tricks noted above including:
– imposed constraints on activities,
– selected schedule calculation method,
– resource leveling,
– activity relationship exploitation, and
– creating impractical periods of multiple critical
paths
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D. Concurrency and other
imaginings
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Concurrency and other
imaginings
• If a delay is encountered, during the updating
process it must be determined if it has an impact to
the overall project completion or to the completion of
a contractual milestone date.
• If the delay has no affect on milestone or overall
project completion, than the delay did not cause any
damage or loss to either the contractor or the owner.
• This occurs as the delay simply reduced the float
time along an activity path.
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Concurrency and other
imaginings
• The analysis and proof of liability, causation and
damage becomes very complex when multiple delay
issues are encountered.
• With each update, typically there are a number of
activities that are not progressed as planned.
• The reasons for the lack of progress are many and
varied and may simply result in logic revisions
adjusting for contractor preferred sequences of work.
• Other issues affecting activity performance may not
be as simply resolved.
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Concurrency and other
imaginings
• Sometimes a single activity may experience multiple
causes of delay.
• For example, during one update period, the façade of
the building may be delayed due to the crane being
diverted for installation of added rooftop units, an
owner responsible change,
• And also due to concrete structure errors preventing
façade placement until concrete rework is performed,
a contractor responsible delay.
• The question then becomes, did the contractor’s
structure errors or the owner’s change delay the
critical façade or a combination of both?
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Concurrency and other
imaginings
• The arguments are straightforward;
• The contractor argues that the structural repairs
would have been completed much sooner but for the
owner’s change diverting the crane.
• Simply, why hurry up to only wait for the crane to be
freed from the changed work.
• The owner argues that the changed work was
performed while the crane was unoccupied, awaiting
contractor structural repairs, thus the contractor was
not delayed by the change.
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Concurrency and other
imaginings
• If the delay period can be reasonably
apportioned between the various causes of
delay, damages are generally apportioned as
well.
• If the delay cannot be apportioned, than
generally the contractor is given a noncompensable time extension.
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Concurrency and other
imaginings
• Multiple delays may occur to different activities along
the same activity chain or among different activity
chains at the same time or at different times.
• For example, the installation of underground utilities
is delayed by poor performance of a subcontractor
that then delayed critical foundation work.
• The owner delays steel fabrication due to late
changes to the structural drawings.
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Concurrency and other
imaginings
• Even though the underground delay occurs first, the
contractor can argue that the drawing changes will
critically delay steel fabrication and delivery, thus the
foundation work can slip until the steel is ready for
delivery.
• The owner will argue that since the underground
utilities delayed the foundations, it can use that delay
period to revise the steel requirements.
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Concurrency and other
imaginings
• If the contractor argues the “why hurry
up to wait” theory, generally it must:
– demonstrate that it could have completed
on time but for owner caused delay
– and/or the Owner responsible delay was
an overriding significant delay affecting
related work rendering the then current
schedule meaningless. (John Driggs Co., ENG
BCA Nos. 4926, 5061, 5081, 87-2 BCA ¶ 19,833 at
100,388.)
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Concurrency and other
imaginings
• If multiple concurrent delays occur, the party claiming
damages must provide a reasonable basis for
apportioning delay between the parties.
• If the concurrent delays can not be segregated, then
nether party can recover monetary damages from the
other and an excusable but non-compensable time
extension is granted to the contractor.
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Concurrency and other
imaginings
• The resource loaded CPM schedule,
becomes an important tool as various delays are
apportioned between the parties.
• Various tricks can play apart as well including:
– imposed constraints on activities,
– selected schedule calculation method,
– resource leveling,
– activity relationship exploitation, and
– creating impractical periods of multiple critical
paths.
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Please continue with
Chapter 6
Practical Methods to
Reveal CPM Covert
Activities
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