Risk Management in Construction

Objective1 Manage the evaluation & selection of construction methods Objective 2 Manage the planning of work activities & resources to meet contract requirements Objective 3 Manage the selection & formation of contract team Objective 4 Manage the operations of organisation & communication system

Objective 1 Manage the evaluation & selection of construction methods The Contracts Manager's responsibility to ensure the adequacy of contract data, the identification of efficient & effective work methods & the economical use of resources.

Cont’d: Manage the evaluation & selection of construction methods Available contract data is analysed in detail & summarised to enable decisions to be made on methods of construction & installation Contract data e.g. method statement; contract documents; health, safety & environmental plans In instances where available contract data is insufficient additional relevant information is obtained Additional sources of information: customer/customer's representative; contractors; sub-contractors; suppliers; statutory authorities; technical/trade literature

Continued…… Construction and installation methods are identified which optimise the economical use of resources & meet statutory & contractual requirements Methods of construction: sequencing of work; organisation of resources (labour, plant, materials, finance); construction & installation techniques; temporary works

Continued……… Methods are evaluated against relevant criteria & the optimum method selected, recommended & agreed Criteria for selection: materials availability; health, safety & environmental requirements; fire protection; access; HR availability; transportation & traffic considerations; cost benefits; statutory requirements

A detailed method statement is prepared which is clear and concise in content & format and acceptable to all relevant parties

Objective 2 Manage the planning of work activities & resources to meet contract requirements

The Contracts Manager's responsibility to ensure the effective planning of contract activities to meet programme requirements

Cont’d: Manage the planning of work activities & resources to meet contract requirements

Planned activities are scheduled in a format to meet contract requirements & significant external factors Schedules: bar-charts; networks; line of balance; method statement; Contract requirements: contract conditions; statutory consents; third party obligations; health, safety & environmental requirements Activities are sequenced logically & durations are calculated to meet required outcomes

Continued…… The interfaces between each major activity are realistic & set in sequence to optimise the use of available resources Resource requirements are calculated accurately from available information e.g. catalogues etc. Resource requirements: personnel; plant & equipment; materials and components; sub-contractors

Continued…… Where resource requirements are unclear, clarification & advice is obtained from relevant sources

Relevant sources: customer; consultants; in-house support; technical publications Alterations to the programme to suit changed circumstances or which offer cost & time benefits are identified, quantified & justified An information feed-back & monitoring system is identified & implemented

Objective 3 Manage the selection & formation of contract team This is concerned with the Contracts Manager's responsibility to ensure the selection & formation of an effective & efficient working team.

Cont’d:

Manage the selection & formation of contract team

Proposals for team composition are negotiated and agreed which provide the greatest opportunities for team effectiveness & efficiency

Appropriate & sufficient construction resources are identified & selected to meet agreed timescales & budgets Types of resource: management; technical staff; operatives; specialist sub-contractors; specialist services Sources of resources: internal or external to the organisation

Continued…… Constraints affecting the quantity, type & availability of human resources are identified & summarised Constraints: location; cost; timescales; skills & experience required & availability; training & development requirements; equal opportunities Appropriate rules are followed for obtaining construction resources Rules: contractual; statutory; recognised industry processes; organisational processes

Continued…… The quality and reliability of construction resources are evaluated & the results made available to interested parties. Appropriate contractual arrangements & terms of appointment are precise & confirmed in writing.

Terms of appointment: employment contract; sub-contract; design & build; fast track; Negotiations, contracts & agreements are conducted & concluded in a manner that preserves goodwill & trust.

Objective 4 Manage the operation of organisation & communication system

This is concerned with the Contracts Manager's responsibility to ensure the operation of an effective organisation & communication system.

Cont’d: Manage the operation of organisation & communication system Organisation & communication system provide clear & effective management, administrative & operational controls. Contract organisation & communication of site management & administration; and head office interface Information about individual roles & accountability are unambiguous & are made available to all relevant parties Roles & accountability are identified through: individual job descriptions; organisation charts; contractual arrangements

Continued…… Methods of communicating, reporting & recording information are established & monitored regularly for effectiveness e.g. oral; written; electronic. Breakdown in communication are identified, causes investigated & appropriate action taken

END OF LECTURE 3 Plan to succeed not to fail in a construction project