PROJECT

MANAGEMENT Lecture 5

Management of Construction Process

Project Procurement




Management of Construction Process

The Architectural Consultancy Practice (ACP) shall provide any or all of the

following types of services:

(a)  Basic Services

(b)  Supplementary Services

(c)  Additional Services

Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process

The Basic Services that may be provided by the architectural consultancy

practice shall be of the following phases:

(1)  Schematic Design Phase

(2)  Design Development Phase

(3)  Contract Documentation Phase

(4)  Contract Implementation & Management Phase

(5)  Final Completion Phase

Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process

(1)  Schematic Design Phase

•  Taking the client’s instructions and analyzing the project brief

•  Preparing preliminary conceptual sketch proposals to interpret the project brief

•  Developing the preliminary conceptual sketch proposals into sketch designs to a
stage sufficient to enable an application to be made for planning approval or
approval in principle as required under any relevant laws

•  Preparing preliminary estimates of the probable construction costs based on the

current area, volume or other unit costs

•  Where applicable, preparing and submitting drawings and other necessary
documents to the relevant approving authorities for either town planning approval
or approval in principle as required under any relevant laws.

Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process

(2) Design Development Phase

•  Upon approval of the sketch designs by either the relevant approving authority or
the client, developing schematic design drawings to a stage to enable other
consultants to commence their detailed design work.

•  Preparing working drawings and submitting the same together with all the
necessary particulars to the relevant approving authorities to obtain building
approval.

•  Updating the preliminary estimates of construction costs and submitting the same
to the client for his approval.

•  Updating the project planning and implementation schedule and submitting the
same to the client for his approval

Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process
(3) Contract Documentation Phase

•  Upon approval by the client of the updated preliminary estimates of construction costs
and the project planning and implementation schedule, preparing and finalizing detailed
drawings and other particulars necessary to the stage of completion sufficient to enable
bills of quantities to be prepared.

•  In collaboration with other consultants, preparing all documents necessary for obtaining
competitive tenders for the works

•  Inviting, on behalf of the client, tenders for the works or collaborating with other
consultants engaged by the client to do so.

•  Evaluating the results of the tenders and submitting a report and recommendation to the
client.

•  Awarding the contract on behalf of the client

•  Preparing the building contract documents, either alone or in collaboration with other
consultants appointed by the client, for signature between the client and the contractor.
Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process

(4) Contract Implementation and Management Phase

•  Performing all functions and duties of the architectural consultancy practice under
the terms and conditions of the building contract

•  Advising the client on the site staff required for the project and estimating the
cost and duration of their employment

•  Providing information and issuing instructions to the contractor as required under
the terms and conditions of the building contract to enable the contractor to
proceed with the works

•  Examining the works programme submitted by the contractor and to be satisfied

that the works can reasonably be completed within the contract period

•  Inspecting the works at periodic intervals so as to ensure that the works are being
executed in accordance with the building contract and to issue a certificate of
practical completion
Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process

(5) Final Completion Phase

•  Issuing a certificate of completion and compliance for building after being satisfied
that the building is fit and safe for occupancy

•  Certifying as-built drawings and submitting maintenance manuals together with

all warranties to the client.

•  Issuing a certificate of making good defects after being satisfied that all defects to
the building have been rectified

•  Preparing final accounts for the contract and issuing a final certificate of payment
to the contractor.

Source : Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010
Management of Construction Process
Project Procurement

Definition
The process required to acquire goods, services and works to attain

project scope, from outside the performing organization

Procurement systems has been defined as something to do with the

type of contract, obligation, rights and liabilities of the parties

involved that is between clients, consultants and contractors

(Ashworth, 1991).
Project Procurement

PROCUREMENT METHODS

1. Traditional Procurement
2. Design and Build Procurement
3. Private Public Partnership (PPP)
Project Procurement Traditional Procurement

Management structure of the

Conventional Procurement

§  the client is under two
contractual obligations;
the consultants and with
the contractor
§  the client has a high level
of control over the
project
§  traditional procurement
can take some time

Project Procurement Traditional Procurement

•  Architect & Consultants to prepare tender

documents & drawings
Pre - Tender

•  Call tender
•  Tender Submission
•  Close Tender
•  Tender Opening
•  Tender Evaluation
Tender •  Tender Interviews
•  Tender Recommendation

•  Award Contract
•  Compiling Contract Documents
•  Formalizing Contract by signing the Contract
Post – •  & stamp duty
Tender
Project Procurement Traditional Procurement

Traditional methods of TENDERING

Open tendering Allows practically, any contractor to

submit a tender for the work

Selective tendering Consists of a short-list of contractors that

are known to have the appropriate
qualifications to carry out the work
satisfactorily
Negotiated tendering Tenders are obtained by the client by
inviting a single contractor
Project Procurement Design & Build Procurement

Design and Build Procurement

Management structure of the Design and Build Contract

Source : RoshanaTakim,1999.Management structure for design and build contract.

Project Procurement Design & Build Procurement

Design and Build Procurement

§  Suitable for large, complex and specialized projects

§  The contractor is responsible to design and build the project

§  Most design/build contracts are lump-sum fixed-price in nature


§  Single point responsibility

§  The client lacks control over the design

§  Construction can commence earlier than traditional procured

§  Cost and completion time is firmer and fixed

§  Better chance for the client to obtain their project completed within budget
Project Procurement Private Public Partnership

Private Public Partnership

§  Collaboration between public authorities vs private sector

§  Handling large public projects through joint venture arrangement

§  Reduce government’s financial burden


§  Deliver quality projects within the shortest possible duration.

§  Non-standard forms of contract (amended versions of FIDIC Standard
Forms) (Fédération Internationale Des Ingénieurs-Conseils)

§  Project examples : MRT, Smart Tunnels, Airports, PLUS Expressways

Project Procurement Contracts

What is a contract?
§  A legal binding agreement between two or more parties.

What is the use of contracts?

§  To allocate the duties between parties
§  To recognize and allocate the risk to the different parties
§  To reduce uncertainty surrounding the project
§  To allow the parties to plan for the project & the future as best as possible

Standard Form of Contract Non-Standard Form of Contract

ADVANTAGES ADVANTAGES
§  It provides more certainty when tendering §  It is tailored to very specific requirement to suit
§  Familiarity makes it easier & quicker to be projects
priced
§  It has balanced allocation of risks between
the contracting parties
§  It is more economical

DISADVANTAGES DISADVANTAGES
§  It is not tailored for highly specific projects §  Contracting Parties not familiar to the
§  It prevents innovation interpretations
§  It has unbalanced allocations of risks §  It has not been tested, hence subject to
challenges & disputes

Project Procurement Type of Contracts
Project Procurement
PROJECT MANAGEMENT References

Ashworth, A. (1991), Contractual Procedures in the Construction Industry, 2nd Ed., Longman Scientific and
Technical Group, Harlow, UK.

Kuala Lumpur Regional Centre for Arbitration (KLCRA) (2017), The Standard Form of Building Contract 2017

Lembaga Akitek Malaysia (2010), Part lll Scale of Minimum Fees, Architects (Scale of Minimum Fees) Rules 2010

Pertubuhan Akitek Malaysia (2006), Agreement and Conditions of PAM Contract 2006

Takim, R. (1999), Management structure for design and build contract.