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Recommended CPM Schedule Update Submission Items

June 04, 2018

 

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While the previous posting described the importance of updating the project schedule, this posting identifies essential project schedule information that should be included in a schedule update submission. Clear and timely communication is a key contributor to success on construction projects. These recommended schedule update submission items will ensure that the contractor is effective in communicating its plan for completion, and will promote an environment of trust, transparency, and confidence among the project team.

A contractor’s schedule update submission should, at the very minimum, include a detailed narrative, the native electronic schedule file, and a small collection of printouts. Each of these items is discussed in more detail below.

Detailed Schedule Update Narrative

A properly prepared and detailed update narrative is a valuable tool not only for the contractor, but for the entire project team. By identifying the project’s current status, critical path, and forecast completion dates, and by describing the project’s current problems, upcoming issues, and potential solutions to those problems and issues, the update narrative can be a vital communication vehicle for the project team.

Although the reporting of unresolved change orders, delays, and other project issues in the update narrative may not satisfy the contractual, statutory, or legal notice requirements, reporting of these issues in the update narrative, on at least a monthly basis, should serve to ensure that the project team was aware of these issues

Don’t Forget to Update Your Project Schedule or (Don’t Neglect Your Project Schedule)

May 21, 2018

 

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On construction projects, time equals money. When construction projects finish late, both contractors and owners potentially incur additional, unanticipated time-related costs. It often happens that well before the project actually finishes, the project team is aware that the project will finish late. A properly updated project schedule is the only time-management tool available to the project team that can reliably forecast the project’s late finish date.

Unfortunately, toward the end of projects, as the pace of work intensifies and as the project team focuses their efforts on solving problems and completing the work, the project schedule is too often ignored. As a consequence, the project schedule is not updated and submitted on a monthly basis, as required by the contract or per project schedule management best practices.

Just as a properly updated project schedule is the only project management tool that forecasts when the work will be complete, it’s also the only time-management tool on the project that can be used to reliably identify and measure how, and to what extent, the project was delayed.

Predictably, and as Murphy’s Law dictates, the project is nearly always delayed whenever the project schedule is not updated and submitted. Therefore, to ensure that the current schedule update always represents the current plan for completion, contractors should also prepare and submit periodic schedule updates in accordance with the contracts. Additionally, contractors should also

Construction Delay Analysis – Principle No. 5 of 5

May 07, 2018

Delay Analysis Principle No. 5:

Activity delay and project delay are not the same thing.

Too often, contractors and analysts submit time extension requests, or delay claims, that attempt to measure or calculate “project delay” by comparing how much later an activity starts or finishes, compared to when it was depicted to start or finish in the project’s schedule, without regard to whether the activity is even on the critical path.

As noted in Delay Analysis Principle No. 1, and reiterated in Principle Nos. 2 through 4, “only delays to the project’s critical path will delay the project.” The proper way to think about activity and project delay is that a delay to a critical activity is what causes the delay to the project. Conceptually, activity delay is the “cause” and the project delay is the “effect.”

So, when a critical activity starts late, finishes late, or progresses more slowly than expected, that activity delay could cause a delay to the project’s completion date, which is the “project delay.” It is this project delay that is the ultimate result of a critical activity’s late start, late finish, or slow progress.

More importantly, when a project includes an incentive/disincentive clause or a liquidated damages clause, the payment for the earned incentive, the assessment of the disincentive amounts, or the liquidated damages are calculated from a specific contract milestone date. Therefore, when calculating project delay to a specific contract milestone, the analyst should calculate the delay by measuring how many days late the milestone

Construction Delay Analysis – Principle No. 4 of 5

April 23, 2018

Delay Analysis Principle No. 4:

The critical path can and does shift.

No matter how large or small your project is, no project is built “exactly” as it was planned. You’ve heard the cliché: the best-laid plans of mice and men…. No matter how carefully a project is planned, it is impossible to predict every problem or obstacle that might be encountered. To address these challenges, we need a project scheduling tool that we can adjust to the ever-evolving project conditions.

Similarly, even if a contractor was able to prepare the best possible construction plan and schedule, the plan will change or need to evolve in response to things like weather, design changes, and subcontractor performance issues over the duration of the project. The only constant in life and construction is change. In fact, construction contracts are specifically written to deal with unanticipated changes as they arise.

If we accept that the contractor’s construction plan will change over the course of the project, then the natural extension of this concept is to accept the fact that the critical path is dynamic in nature and may change, or shift, during the project in response to the project’s changing conditions.

Shifts to the critical path depend on how the project is planned; how the project work progresses or does not progress; and the changes that are made to the schedule logic and activity durations.

When managing a project, it is essential to identify when the critical path changes, or shifts, to make certain that

Construction Delay Analysis – Principle No. 3 of 5

April 09, 2018

Delay Analysis Principle No. 3:

The critical path is the longest path.

Identifying the critical path is one of the very first things we look for when opening a CPM schedule for the first time. It is certainly the first significant step when performing a schedule delay analysis.

Oracle’s Project Management (P6) scheduling software package allows users to identify activities in the project schedule as critical activities by coloring them “red.” The user may identify the critical path either by total float values or by using the software’s longest path feature. The selection of one of these options merely instructs the scheduling software which activities should be colored red. For example, a user could select total float as the way to identify critical activities, and instruct the software that all activities with total float values of 25 workdays or less be identified as critical and colored red.

However, merely identifying activities with certain total float values as critical does not mean that they are automatically on the project’s critical path. Common features of modern CPM scheduling programs thwart the use of float as a reliable indicator of the critical path. As a result, the path of least float, zero float, or most negative float, may not be the critical path – though is used to be a reliable indicator.

In fact, Oracle’s Primavera Project Management (P6) states that projects using multiple calendars should rely on the “longest path” filter to identify the critical path, because “. . .using float to identify

Construction Delay Analysis – Principle No. 2 of 5

March 26, 2018

Delay Analysis Principle No. 2:

Not every delay to the critical path will delay the project.

As introduced in the Delay Analysis Principle No. 1 blog posting, “only delays to the project’s critical path will delay the project.” However, the converse is not true – “not every delay to the critical path delays the project.”

For a delay to the critical path to not delay the project, some critical path activities must have positive total float values. The most common reason for a critical path activity to have positive total float value is that it has been assigned a “work calendar” containing a non-work period. The classic example is a temperature-sensitive work item, like the placement of concrete and hot mix asphalt (HMA). These work activities would be assigned to a “work calendar” that shows the winter as a non-work period.

Consider the following graphical depiction of the critical path of a roadway project. Note that the project’s critical path consists of excavation, subgrade, and base course work that is followed by the placement of HMA, the striping of the roadway, and substantial completion.

Winter Non-work Period Chart Showing Float On Critical Path

Note that the placement of the aggregate base course is planned to finish during the winter. However, the contractor is unable to place the HMA until the asphalt plants open in the spring. The time between the placement of asphalt aggregate base and the start

Construction Delay Analysis – Principle No. 1 of 5

March 12, 2018

Delays on construction projects are common. Properly identifying the source and magnitude of project delays is the first “essential” step in resolving delay and avoiding disputes. The method used to measure or quantify delays is a function of and dependent upon the type and quality of the project documentation available. Most construction projects use critical path method (CPM) schedules to plan the work and to track progress. Regardless of the scheduling method chosen for the project, there are five basic and immutable principles that should be used to guide every analysis of delays.

Delay Analysis Principle No. 1:

Only delays to the project’s critical path will delay the project.

It is important to recognize that every construction project has a “critical path” – even if it does not have an accompanying CPM schedule. A CPM schedule is merely the time-management tool that enables the project team to more reliably identify the project’s critical path. The critical path is the longest path of activities in the CPM schedule network that calculates the project’s duration.

Based on this fundamental concept, if you were to add one workday to the project’s critical path, then the result would be a one-workday increase to the project’s duration, or said another way, a one-workday delay to the project. Because the critical path is responsible for determining the project’s duration, and an analysis of delay attempts to identify the cause of and measure project delay, every analysis of delays should begin with the identification of the project’s critical path

Proper Documentation to Get Claims and Change Orders Approved

March 02, 2018

Helping contractors prepare change order requests and claims is one of the things that I do every day. In doing so, I often see them struggle with exactly what they need to include to make their change orders and claims persuasive and, more importantly, successful.

One of the keys to a persuasive and successful change order request or claim is providing adequate documentation. To fully appreciate what the term “adequate documentation” means, it’s important to consider what I believe are the three main elements of a change order or claim: Entitlement, Impact, and Cost. If we can address each of these, your chances of receiving payment for the change order or claim improves significantly.

Looking at each element in turn, here is the kind of documentation that should be included in a change order request or claim. Entitlement

What Does the Contract Say?

Referencing your contract and the contractual provisions relevant to the issues are things that I cannot stress enough. By definition, a “change” is something that caused your work to differ from what your contract originally contemplated you would be responsible for. You need to show how the project work, working conditions, or requirements differed from the contract work, conditions, or requirements. Then reference the appropriate contract provision. This becomes the foundation for your change order request or claim.

What are the Facts?

In addition to showing your contract obligations, you also have to establish that the work, conditions, or requirements are, in fact, different from your obligations as set forth in your contract. This

What Is The Critical Path?

February 12, 2018

The key to resolving delay-related disputes on construction projects is to properly identify the cause of the project delay. Because only delays to the project’s critical path will extend the project’s duration, or delay the project’s completion date, it is essential that construction professionals and construction attorneys be able to define and identify the project’s “critical path.”

The critical path method (CPM) is the standard scheduling method for managing construction projects, and the “critical path” is the defining feature of the CPM scheduling method. One would think that in the past 60 years that CPM scheduling has been used, there would be one, widely-accepted definition for “critical path.” Unfortunately, you’d be wrong. Simply, the critical path is the work path, or sequence of work activities, that forecasts when your “project” will finish. (As an aside, a critical path exists even if the project didn’t use a CPM schedule. Projects have a critical path whether scheduled with a bar chart, a CPM, or no schedule at all.)

The Oracle Primavera P6 Professional Help website defines the critical path as follows: The critical path is a series of activities that determines a project’s completion time. The duration of the activities on the critical path controls the duration of the entire project; a delay to any of these activities will delay the finish date of the entire project…

The essential characteristics of this definition of the critical path are that it is a “. . . series of activities that determines a project’s completion. . .” and that

Notice: Give it or Lose $$$!!!

January 29, 2018

Construction is a risky enterprise for contractors. Unplanned and unanticipated events continually occur and should be addressed as quickly as possible. In fact, construction contracts are written specifically to deal with unanticipated events and issues. Properly managing the costs resulting from unanticipated events experienced during construction often determines whether the project is profitable or not.

When unanticipated conditions and issues arise, the contractor’s first action should be to immediately notify the owner of the potential impact (additional costs and time) of the unanticipated event or issue. Contractually, providing proper notice to owners of a potential change or unanticipated event when it arises enables owners to evaluate and address the potential change as quickly and cost effectively as possible. However, more importantly for contractors, properly notifying owners of a potential change or unanticipated event is an essential step in establishing their entitlement to request and recover their additional costs and the corresponding time extension.

Notice requirements are peppered throughout every construction contract and are too often ignored by both parties when unanticipated events are encountered. Do not fall into this trap! Improper notice is referred to as the owner’s “shield” from contractor requests for additional compensation. Contractors must be both knowledgeable of their contractual notice requirements and diligent in fulfilling them to ensure that they put themselves in the best position to recover their additional costs caused by unanticipated events.

For more on this or any other topic, please call me at 215-814-6400 or email me at mark.nagata@traunerconsulting.com.

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