Constrution Schedules Can Influence the Outcome of a Dispute Resolution Process
by Frank P Ndubi, Greenbill Quantity Surveyors (Kenya)
Milestones in project schedules should be mutually agreed upon by the contractual parties and, perhaps, other stakeholders.
Project schedules are dynamic, so updated forecasts sometimes show that critical deadlines will probably be missed. When this occurs, a recovery plan and schedule should be developed and implemented. The recovery plan and schedule must include the assessment of the impact on the obligations of the contractual parties and should be closely monitored. Recovery schedules are based on updated trends, analysis, and forecasts. When trends and forecasts indicate that the current targets may not be achievable, alternatives must be developed. Once a recovery schedule is implemented, it is confirmed with continuous trending and forecasting, and progress is monitored and reported to appropriate stakeholders.
A majority of the construction project standard forms of contract have a predetermined completion date embedded into the contract. The project management team in tracking the progress will always want to establish whether the date for completion will be met. The tool that they use is the works programme/schedule. Planning and Scheduling are the foundations of good governance, transparency and success. There is no denying the fact that in many economies corruption is entrenched in the construction sector. Working against corruption in accordance with the standard forms of contract, is intended to help create a a system whereby all business transactions are visible to a whole variety of project stakeholders. Further, the scheduling data should be made available during the dispute resolution and settlement of claims as and when they arise. The Contractor should, therefore, be required to develop a project network schedule showing in detail an orderly sequence of all activities, both on and off-site, necessary for timely completion of the work, a manpower schedule for each section of the work showing labour resources expected/required throughout for the Contract and a plant schedule detailing the plant requirements needed to achieve the durations established in the construction schedule.
Project planning and scheduling
Project planning is the identification of the project objectives and the orderly activities necessary to complete the project. It involves answering the questions:
- what must be done in the future to reach the project objective
- how it will be done
- who will do it
- when it will be done
Scheduling is a description of when each activity in a project can be accomplished and must be finished to be completed in timey. The simplest of schedules depicts in bar chart format the start and finish of activities of a given duration and complex schedules, generally in CPM format, include schedule logic and show the critical path and float associated with each activity. A schedule, being a time sequence of activities and events, represents an operating timetable that defines the:
- relative beginning and ending times of activities
- occurrence times of events
- risk and opportunity reviews
Resource allocation, a critical input for project schedules, is unfortunately not factored into most project schedules. The cost estimate identifies the initial risk that is associated with the project timeframe and should be incorporated into the baseline schedule. Cost and resource allocations are major elements of a schedule. Effective allocation of costs and resources imposes a fundamental, underlying requirement for successful project completion. Sound schedules merge cost, technical, and contractual data to influence programme management decisions and actions. Realistic schedules help stakeholders make key go-ahead decisions, track and assess past performance, and predict future performance and costs. It is important to get stakeholder “buy-in” for the schedule. If they do not buy into the schedule, there may be no sense of ownership. Disagreements will increase, maybe resulting in delays or impacts. Stakeholder feedback is important in maintaining and updating a schedule. During the execution of a project, since the schedule is dynamic, continual re-assessment of the work is important to the overall success of the project and feedback must be received, analysed and incorporated from all stakeholders.
The preparation and adjustments of the schedule must be appropriate to the phase of work. The schedule is a database of data elements that come into play when disputes and claims arise. The baseline schedule is the foundation for progress measuring, trending, and reporting. The baseline schedule should be agreed upon by stakeholders before commencing significant work and is not altered. The baseline schedule remains unchanged until a new baseline is approved, typically upon approval of contract modifications of budget or schedule. Documentation of the underlying principles that support the assumptions, constraints, and parameters used to build the schedule is put into a narrative, with supporting materials to form the complete baseline package. If changes occur to the schedule and significantly impact the critical path or completion date, the schedule and supporting documentation may be referenced and the necessary action taken to support status updating, changes, and rebaselining, as appropriate.
The project schedule incorporates the major project milestone dates, the works breakdown structure, execution priorities, and identified schedule critical paths all based on the path of construction and system handover sequence that has been identified by the construction and commissioning respectively. This time-phased schedule is representative of the plan to deliver the outcomes as outlined in the project plan. The estimating and progress measurement systems are defined in the schedule plan. The resource work hours defined in the project estimate are downloaded into the scheduled activities.
The project schedule control begins at the commencement of the project’s work and the main steps are:
- monitoring the scheduled activities for actual start and finish dates and projecting the remaining durations for the work that is in progress
- performing evaluations of progress and earned value
- carrying out schedule analysis to determine the critical path and schedule deviations from the plans.
The schedule control provides an early indication of deviations from the plan so that corrective actions can be implemented to minimise schedule and cost impact on the performance of the project.
The schedule change management process recognises the importance of understanding the project’s execution baseline and the evaluation of the schedule and resource requirements associated with the changing scope/quantity. The schedule update must incorporate changes to reflect accurately the current scope of the project’s work. Activity durations and resource requirements must be adjusted as changes are approved. This process ensures that the project schedule continues to function as an accurate model of the project’s execution plan and the project forecast reflects current resource requirements.
In acceleration, many impacts require an in-depth knowledge of the scope of work. The management team must understand the means and methods of implementing an acceleration plan fully, to analyse the options for acceleration. The project team must fully understand how all aspects of the cost estimate are incorporated into the cost-loaded baseline schedule and form the basis for the initial project cash flow and resource allocations. As the implementation of an acceleration plan is often a contractual issue, the need to document and communicate the means, methods and assumptions of the revised execution plan is critical.
References:
AACE International
These are the views of the author and not of Barton Legal, and should is not to be treated as advice or guidance
