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CONSTRUCTION CLAIMS and DISPUTES – Subject Series Summary – Update 11-Nov-2014

November 11, 2014 By

Just as the businesses and economies have cycles, capital projects (particularly engineering and construction) have recurring cycles.  The pendulum swings back and forth within the bounds of the capital project cycle.  In capital projects, the cycle can be three to five years, depending on the economy, size and complexity of the projects and other factors.

At this time, the market seems to be transitioning from project planning and early execution into middle to later-stage execution with emergence of disputes.  As the claims and disputes marketplace intensifies over the next several years, Construction Claims and Disputes will become an increasingly commonplace and a relevant topic for capital project management professionals.

Construction Claims and Disputes continues to be the most popular subject on Project Professionals.  Further, it is the most requested line of services provided by McLaughlin & McLaughlin.  M&M are project management practitioners (in the field) and, yes, we practice what we preach.  Further, our choice of topics for Project Professionals posts is driven by and reflective of practical and current issues.  This is not esoteric, academic or hypothetical “stuff”.

This summary update provides readers with an overview of prior posts and provides a baseline for future posts that will follow on a timely basis.  Initially, this Subject Series, Construction Claims and Disputes, was posted during January 2011 through July 2014.  During the past several years, greater than 25% of views by visitors have been to this Subject Series.

Ideally this Subject Series  provides a starting point to investigate best practice on many planning and execution features of construction claims and disputes. [Read more…]

Filed Under: Claims, Featured, General, Productivity, Projects, Uncategorized Tagged With: , , , , , , , , , , , , , , , , , ,

CONSTRUCTION CLAIMS and DISPUTES – Subject Series Summary

January 8, 2014 By

Construction Claims and Disputes is the most popular subject on Project Professionals and has been for several years.  Further, it is the most requested line of services provided by McLaughlin & McLaughlin.    M&M are project management practitioners (in the field) and, yes, we practice what we preach.  Further, our choice of topics for Project Professionals posts is driven by and reflective of practical and current issues.  This is not esoteric, academic or hypothetical “stuff”.

This summary update provides readers with an overview of prior posts and provides a baseline for future posts that will follow on a timely basis.  Initially, this Subject Series, Construction Claims and Disputes, was posted during January 2011 through August 2013.  During the past several years, greater than 25% of views by visitors have been to this Subject Series.

Ideally this Subject Series  provides a starting point to investigate best practice on many planning and execution features of construction claims and disputes.

Construction Claims and Disputes (Part 0)  – This introduction formats the discussion with definitions, claim categories and key industry references.  This post is consistent with M&M experience in many years of professional services.

The Overview (Part 1)  –Part 1 updates Part 0, the introduction.

Construction Claims Management Planning (Part 2) – This is the most popular post in this (most popular) Subject Series.  Construction claims (or the risk of claims) can and should be professionally managed.  View this process as a piece of project (execution) planning [link].  This post outlines elements of a Construction Claims Management Plan.  Further, it addresses elements of defining a Claim Strategy.  Stakeholders include Owners, Prime Contractors and Subcontractors.  Do not miss this post.

Current Project Professionals Posts (Part 3) – Claims are organized into four general categories.  These categories are consistent with the frequency of occurrence, methods of management and other key managerial considerations.  The categories are

  • Scope of Work, Changed Work or Variations
  • Delay and Acceleration, Time-Related
  • Disruption / Productivity (usually labor/labour)
  • Terms and Conditions.

Pricing Construction Claims (Part 4) – This post addresses the…  Think you know how to price your (or other’s) claims?   Andrew (Andy) Ness, 2012-13 Chair, ABA Forum on the Construction Industry probably disagrees with your answer.  Read this post and consider Andy’s position as well as other considerations regarding claim pricing/damages.  The content of the recent ABA book on the subject is covered.

Pricing Construction Claims (continued) (Part 5) – Are construction claims and disputes “all about the money?”  Some believe this to be the case.  This post (Part 5) expands on Part 4 by addressing pricing and citing additional references.

Scope of Work – Baseline (Part 6) – It is widely believed and accepted that Scope of Work and/or Changed Work is the single largest source of claims and disputes in engineering and construction (as well as many other contracted services).  In order to establish departures from the baseline scope of work, you must be able to define the applicable baseline.  This post cites various sources for baseline definition,

Scope of Work – Plans and Specifications (Part 7) – Several industry sources (publications) are used to elaborate on execution and contracting strategies that rely on plans and specifications as a major component of scope or work definition.  This discussion includes typical contract documents and contract provisions wherein scope of work, services, supply and / or facilities is / are defined.  Suggestions for configuration and change management in the field are included.

Other Subject Series that are both relevant and popular include:

Going forward, we will post other features of CONSTRUCTION CLAIMS and DISPUTES.

My we wish you the best of luck and let us all attempt to confront and deal with these and other project management challenges.  It is crucial that recognition and anticipation of these issues occur during initiation and planning.  However, the recognition and management should continue through execution, controlling and closeout.

Please note that McLaughlin and McLaughlin [M&M] is not a law firm and is not intending to provide legal advice.  M&M is a consulting firm providing (among other services) non-legal expertise in dispute resolution and litigation support.  The Resource Center is for the convenience of blog visitors and M&M does not offer this for commercial purposes.  For further information on M&M services, please see www.McLaughlinandMcLaughlin.com.

 

 

Filed Under: Claims, Featured, General, Projects, Uncategorized Tagged With: , , , , , , , , , , , , , , , ,

CONSTRUCTION CLAIMS and DISPUTES – (Part 4)

March 17, 2013 By

Pricing Construction Claims

This post is the fourth in McLaughlin & McLaughlin’s Project Professionals  Subject Series  Construction Claims and Disputes which are (will be) discussions regarding challenges in potential and actual construction claims and disputes situations.  In this series, we focus on the key aspects of construction claims and disputes management.  This discussion addresses the pricing of claims and disputes.  The compulsion or question is – “How much is a potential claim worth?”  In virtually all disputes, the central issue is the money.  Since it is a win-lose situation, the outcome may be that someone (one party) will pay another party.  Hence, the money is the ultimate issue (sometimes time is at issue, generally presenting itself in money or damages related to the time).

There is an old saying “win the battle, lose the war” which applies to damages in construction claims and disputes.  With facts, logic and analyses on their side, one party (Party A) can prepare and present a very compelling argument regarding the claim (against Party B).  However, winning the argument on the cause (or as it is called, entitlement) is relatively useless without winning the argument on the money related to the effect (or sometimes called damages, quantum, compensation).

Even more compelling, the decision to proceed with a claim (and potentially spend millions of dollars on expenses such as legal fees) should be heavily driven by the potential recovery (the money).  Consequently, parties must have a reasonable assessment of the true value of the dispute and the ability to successfully demonstrate or prove these damages in the resolution process.  Without the ability to prevail on a suitable and acceptable level of damages, pursuing a construction claim through a costly dispute resolution process could be an unwise decision.

In this discussion, we are guided by a highly useful and well grounded newly published book.  It is published by the American Bar Association (ABA) and has been recently (2013) been updated.  This publication is Construction Damages and Remedies, second edition, by Forum on the Construction Industry, American Bar Association.  It is edited by W. Alexander Moseley of the law firm Hand Arendall LLC.  There are nine authors. [Read more…]

Filed Under: Claims, Featured, General, Projects Tagged With: , , , , , , , , , , , ,

PROJECT PLANNING (Part 4)

February 15, 2013 By

Summary of Posts

This summary update provides readers with an overview of prior posts regarding Project Planning and provides a baseline for future posts that will follow on a timely basis.

There are two applicable Subject Series.  One Subject Series, PROJECT MANAGEMENT CHALLENGES  was posted during June through September 2011.  Since that time, blog readership has increased very significantly.

The other Subject Series, PROJECT PLANNING  was started in late 2012.  This Subject Series is ongoing and new posts will occur in the upcoming weeks and months.  Readers are encouraged to subscribe to automatic update notification.

This summary is very brief and simply serves as an index for readers to follow.  Of course, detailed descriptions are contained in the individual posts.

Ideally these Subject Series  provide a starting point to investigate best practice on many planning and execution features of project management. [Read more…]

Filed Under: Claims, Featured, General, Productivity, Project Planning, Projects Tagged With: , , , , , , , , , , , , , , , , , , , , , ,

Labor/Labour Productivity –MCAA Publication (Part 13)

February 12, 2012 By

Changed Work, Productivity and Overtime

This is McLaughlin and McLaughlin’s Project Professional’s thirteenth posting regarding labor/labour productivity and disruption.  This contribution provides an overview of a construction industry publication that is extremely helpful and valuable for all stakeholders concerned with labor productivity and management.

The Subject Series regarding Labor/Labour Productivity and Disruption can be viewed here.

This publication is Change Orders, Productivity, Overtime, Mechanical Contractors Association of America (MCAA).

[Read more…]

Filed Under: Claims, Featured, General, Productivity, Projects Tagged With: , , , , , , , , , , , , , , , , ,

STAFFING YOUR PROJECT MANAGEMENT TEAM (Part 5) – Acquiring the Project Manager

January 1, 2012 By

Personal Characteristics and Attributes

This McLaughlin and McLaughlin’s Project Professional’s post is the fifth in a series of discussions regarding current challenges with the staffing aspects of your project management team.  The focus is on the managerial aspects of human resource planning and acquisition.  This post (like Part 4, our last post) addresses acquiring the human resources (people) or staffing.  In this case, we focus on acquisition of the project manager. This acquisition of project manager resources will be the subject of several posts over the next several weeks.

A key action, many believe that this selection/acquisition (the project manager) is the most important activity in staffing the project management team.

In past posts, the acquisition strategies have been discussed and evaluated.

This, the first post on acquiring the project manager, will address the personal characteristics and attributes that are important in a professional project manager.  Before looking at sources for a project manager candidate, one needs to settle on the key characteristics (personal and other) that are needed in the specific project and the project execution strategy for your project.  From past posts, it has been asserted that enterprise environmental factors are key inputs.  These factors influence the characteristics and attributes that are needed for a project within your organization.

Please Remember –Teams of people [not machines and not software] build projects. Consequently, if you cannot acquire the requisite staffing, you are not prepared to execute the project [at least as planned].

Please Remember –This is a team, not a group of individuals. Have you noticed that so many sports teams with superstars rarely win championships?  Further, have you noticed that championship teams have few, if any, superstars?  It is the project team, not the individual that must be staffed and developed.  As they say, there is no “I” in team. [Read more…]

Filed Under: Featured, General, Projects Tagged With: , , , , , , , , , , , , , ,

STAFFING YOUR PROJECT MANAGEMENT TEAM (Part 4) – Acquiring People from the Market

December 17, 2011 By

This McLaughlin & McLaughlin’s Project Professionals post is the fourth in a series of discussions regarding current challenges with the staffing aspects of your project management team.  The focus is on the managerial aspects of human resource planning and acquisition.  This post (like Part 3, our last post) addresses acquiring the human resources (people) or staffing.  While the planning may be the most important activity or action in the process, the challenge ultimately is obtaining the people to implement your intended execution strategy.

There are many acquisition strategies.  These acquisition strategies differ for various market conditions, organizational situations, project needs and other project variables.  Markets that are very active/hot [oil and gas, mining, natural resources, etc.] present unique challenges.  Skill-sets that are in high demand [project controls, planning, scheduling, technical, etc.] present further unique challenges.  The project Human Resource Plan must address these unique challenges.  Further, the project plan and schedule must allow the time to complete the acquisition process as well as the requisite training/indoctrination.  Finally, the project budget must realistically provide for the cost of these resources (often expensive non-employee persons) as well as the acquisition costs (e.g. recruiters).  If this planning is not in place, do not launch into project execution.

Please Remember –Teams of people [not machines and not software] build projects. Consequently, if you cannot acquire the requisite staffing, you are not prepared to execute the project [at least as planned].

Please Remember –This is a team, not a group of individuals.  Have you noticed that so many sports teams with superstars rarely win championships?  Further, have you noticed that championship teams have few, if any, superstars?  It is the project team, not the individual that must be staffed and developed.  As they say, there is no “I” in team. [Read more…]

Filed Under: Claims, Featured, General, Projects Tagged With: , , , , , , , , , , , , , , , ,

STAFFING YOUR PROJECT MANAGEMENT TEAM (Part 2) – Planning

December 3, 2011 By

This post is the second in McLaughlin & McLaughlin’s Project Professionals Blog series of discussions regarding current challenges being encountered in today’s efforts/environment associated with the human resource aspects of your project management team.  More specifically, we have titled the series STAFFING YOUR PROJECT MANAGEMENT TEAM, and we intend to focus heavily on the managerial aspects of human resource planning and acquisition.  This post focuses on planning the human resources or staffing.  In many respects, the planning is the most important activity or action in the process.  Proper and timely planning including documenting the plan will provide the roadmap for the path to success.  It will also tend to reveal problems and challenges before they become a problem.

In order to present this topic in a logical manner and with an industry-recognized lexicon, we are using the PMI Project Management Processes for a Project as presented in A Guide to the Project Management Body of Knowledge (PMBOK® Guide).

Sources that are used in this post are:

Please Remember – People [not machines and not software] build projects. [Read more…]

Filed Under: Claims, Featured, General, Projects Tagged With: , , , , , , , , , , , , , ,

PRODUCTIVITY SERIES REVIEW (reissue 2)

November 7, 2011 By

McLaughlin & McLaughlin’s Project Professionals blog has a series of posts regarding labor/labour productivity. Over the last month we have added to this popular series.  The first summary was posted in June and the latest was a reissue in October 2011.  Readership has continued to increase.  Consequently, we are reissuing this updated and expanded post as an overview of the labor/labour productivity series.

Productivity is a hot topic and has given rise to much discussion and debate in the project management world.  Labor productivity can be a competitive advantage or a managerial challenge (actually, both and more).  Therefore, we believe that there is high potential benefit in a review of McLaughlin & McLaughlin’s Productivity Series.  Below, we have the titles and links to each post followed by a brief summary of the content.  We intend to augment these posts with additional writings on the subject. [Read more…]

Filed Under: Claims, Featured, General, Productivity, Projects Tagged With: , , , , , , , , , , , ,

Labor/Labour Productivity – Overtime Impacts (Part 12)

October 29, 2011 By

EVALUATING IMPACT

This is the twelfth posting regarding labor/labour productivity and disruption.  This contribution provides thoughts on the evaluation of impact of overtime on labor productivity.  The Subject Series can be viewed here.

Overtime or Extended Working Hours represent one of the widely recognized causes of loss in labor/labour efficiency or productivity.  A key issue for project planners and managers is the notion of how to evaluate this impact.  The evaluation challenge is present whether the analysis is prospective (contemporaneous) or retrospective.  Retrospective analyses can be used or required during project execution or part of forensic analyses.

Regarding the evaluation techniques, K Pickavance (please see below for citation) organizes the methods as follows:

  1. “Planned (undisrupted) versus actual (disrupted)”
  2. “Actual  (undisrupted) versus actual (disrupted) – the measured mile approach”
  3. “Historic (undisrupted – on other projects) versus actual (disrupted)”
  4. “Industry productivity norms (undisrupted) versus actual (disrupted)”
  5. “Time and motion study (undisrupted) versus actual (disrupted).”

As previously posted, project planning is one of the major challenges for program and project management teams.  Past posts have discussed many aspects of project planning.  The series regarding Project Management Challenges is here.  Part 5 of this series is particularly relevant or germane to the discussion regarding the impact of overtime on labor productivity in this post.

The impact of overtime on labor productivity is a relevant and serious consideration in many aspects of program and project management.  In the case of impact assessment, the anticipation of a particular analytical methodology is a planning consideration.  Said differently, the project planning should consider the data needed and the collection techniques to be used relative to the assessment of overtime impact on productivity.

Again, the impact on the schedule duration must consider the planned and forecasted progress using the proper productivity.  As overtime is introduced, progress may well be impacted.  The time impact of more work hours per week is mitigated or offset by the lowered productivity. [Read more…]

Filed Under: Claims, Featured, General, Productivity, Projects Tagged With: , , , , , , , , , , , , ,
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