Construction Management

ADDIS ABABA SCIENCE & TECHNOLOGY UNIVERSITY

COLLEGE OF ARCHITECTURAL & CIVIL ENGINEERING
DEPARTMENT OF CIVIL ENGINEERING

Academic year 2010 E.C Instructor A.M

Course title: Construction Management

Course number: CEng 5204

Credits hours: 3 ECTS 5

Pre-requisites:

Contact hour (per week): 4 lecture hours

 Course objectives & By the end of this course students should :

 Be aware of the size / scope of the construction industry, and the role of the organizations which are involved in
construction projects.
 Know about difference phases of construction projects, contract administration and procedures for public projects.
 Know the steps that lead to successful construction projects
 Be familiar with aspects of construction project management such as : project planning, progress , monitoring,
construction and risk management , cost control, claim and disputes
 Understand the role/complexity of construction project management, by completing cost estimation, project planning
& sequencing exercises for example project(s)
 competences to be acquired/ course level competences
 Students will learn how to prepare TOR for project implementation, techniques fo project management and planning.,
site organization and basics of insurances in the construction industry.
Course description : construction in the national economy, parties in construction industry, construction and consulting
organizations, design and construction procedure of public projects, preparation of TOR, project management and
planning techniques, financial project appraisal and cash flow analysis, personnel management., site organizations,
insurance in construction industry, individual/group term paper preparation and presentation

COURSE OUTLINE (MODULE CONTENTS)

Chapter 1. introduction to construction industry
1.1 construction in the national economy
1.2 Construction in Ethiopia
1.3 Major Types of Construction work
1.4 Characteristics of construction industry / project
1.5 Parties in construction industry
The Owner (Client)
Contractors
The Design Professionals
The Construction Professionals
1.6 Consulting organizations
1.6.1 consulting engineer responsibilities
Chapter 2. Project management and planning techniques

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2.1 construction management definition and its importance

2.2 What is project management?
2.3 The Need for construction Project Management
2.4 project management knowledge areas
2.5 key general management skills
2.6 project management processes
2.6.1 Project life cycle
Initiating, planning, executing, controlling (and monitoring), closing
Chapter 3 construction planning and scheduling
3.1 project planning
3.1.1 Work Breakdown Structure (WBS)
3.1.2 Project Activities
3.1.3 Activities Relationships
3.1.4 Drawing Project Network
3.2 project scheduling
3.2 project progress monitoring and control
3.2.1 Project time control
3.2.2 Project cost control
Chapter 4. Construction contract administration (optional)
3.1 contract definitions
3.2 elements of a contract
3.3 contract documents
3.4 conditions of contract
3.4.1 General conditions of contract
3.4.2 Special conditions of contract
3.5 types of construction contract
3.5factors influencing contract choice
3.6 project delivery methods
3.7 design and construction procedure of public projects
3.8 project risk management
3.9 construction claim and dispute
Chapter 5. Preparation of TOR
3.1 what is TOR
3.2 basic content of TOR
3.3 procedure to prepare TOR
Chapter6. Financial project appraisal and cash flow analysis (optional)
6.1 financial project appraisal
6.2 project cash flow analysis
Chapter 7 personnel management
Chapter 8. Site organizations
8.1 General construction site plan /map requirements
8.2 construction site zones
8.3 welfare and office facilities
8.4 traffic on the site
Chapter 9. Insurance in construction industry

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9.1 definition of insurance

9.2 benefits of insurance
9.3 Principles of Insurance
Chapter 10. Individual /group terms paper preparation and presentation
11.1 What is term paper?
11.2 guide lines for preparation of term paper
11.3 guide lines for presenting term papers

Teaching &learning methods

 Lecture, Case studies, project works assignments
Assessment/Evaluation & Grading System
 Continuous assessment includes :
 Test 1--------15%  Assignment ( individual & group )--------15%
 Test 2 --------15%  Attendance ---------5%
 final exam----------------50%
 Attendance requirement:
 Students are expected to attend at least 90 % for theoretical lesson.
Reference
1. Abebe Dinku, construction management and finance , AAU press.
2. Daniel W. Halpin, construction management , Wiley: 3 edition, 2005
3. Richard H. Clough, Glenn A, Sears, and S. Keoki Sears, construction project Management, Wiley ,2000
4. Alan Griffith, paul Watson, construction management, palgrave Macmillan, 2003
5. Any construction management books related to the course.
6. Internet website.
th
7. PMBoK® Guide 4 Edition (internet)

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CHAPTER ONE
INTRODUCTION TO CONSTRUCTION INDUSTRY
1.1 CONSTRUCTION IN THE NATIONAL ECONOMY
 The construction industry is the largest industry in the world.
 Growth in this industry in fact is an indicator of the economic conditions of a country.
 Construction industry is a major factor in the social and political integration of the
society and ranks as one of the major budgetary areas of economies.
 The construction industry is proven to be the corner stone and bedrock of rapid
economic growth of any nation.
 The building and infrastructure development sector of the construction industry is a
catalyst, a rock, and the strongest base for rapid economic growth, it therefore becomes
very imperative that building and infrastructure projects are project managed efficiently to
succeed.
 Construction industry is more of a service than a manufacturing industry.
 This is because the construction industry consumes a wide employment circle of labor.
 While the manufacturing industry exhibit high-quality products, timelines of service delivery,
reasonable cost of service, and low failure rates, the construction industry, on the other
hand, is generally the opposite.
 Most projects exhibit cost overruns, time extensions, and conflicts among parties.

1.2 CONSTRUCTION IN ETHIOPIA

 The Construction Industry can be categorized into three major sectors; namely,
1. Transport and Communication (Road, Railway, Airway, and Telecommunication related
physical works)
2. Water Works and Energy
3. Buildings and Other Physical Infrastructures.
 Accordingly, their capital budget requirements vary extensively depending on the focus
the economical trend requires for the nation development.
 facts showed that:
 Transport and Communication sector consumed not less than 70% of the capital
budget allotted for the Construction industry.
 Buildings covered only about 13 %.
 About 58.2% of the federal capital budget of Ethiopia is channeled to the development
of Physical infrastructures.
 These figures have indicated that the construction industry is one of the most important
contributors for the Politico-legal, economical, socio-cultural and technological
development of Ethiopia.
 WB, 1984 has showed that the construction industry is one among four multi sectoral
components that plays important role in developing countries.
 The construction business furnishes capital improvements to countries, which is very much
related to the development of investments to provide future benefit to nations.
 Since the construction industry primarily represents investment, construction activities drop
more than other industries during recessions.

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 Construction works being a team work output, the individuals involved in carrying out the
works and their separate outputs is given the highest importance.
 Hence, workers in the construction industry shall be highly motivated and well skilled.
 However, the individuals shall be geared to focus on the group coordination and its output.
 The construction industry often makes skills more immediately rewarding and that is why
mostly workers in this industry became more prosperous professionals than in other
industries.
 Considering the allocated budget every fiscal year and the number of workmen involved,
construction industry is second only to agriculture in Ethiopia.

1.3 MAJOR TYPES OF CONSTRUCTION WORK

 The constructed facilities may be classified into four major categories, each with its
own characteristics:
1) Residential Housing Construction
 Residential housing construction includes houses and high-rise apartments.
 The residential housing market is heavily affected by general economic conditions.
2) Institutional and Commercial Building Construction
 Institutional and commercial building encompasses a great variety of project types and
sizes, such as schools and universities, medical centers and hospitals, sports facilities,
shopping centers, warehouses and light manufacturing plants, and skyscrapers for
offices and hotels.
 The owners of such buildings may or may not be familiar with construction industry
practices, but they usually are able to select competent professional consultants and
arrange the financing of the constructed facilities themselves.
 Because of the higher costs and greater sophistication of institutional and commercial
buildings in comparison with residential housing, this market segment is shared by fewer
competitors.
 Since the construction of some of these buildings is a long process which once started will take
some time to proceed until completion, the demand is less sensitive to general economic
conditions than that for housing construction.
3) Specialized Industrial Construction
 Specialized industrial construction usually involves very large scale projects with a high
degree of technological complexity, such as oil refineries, steel mills, chemical
processing plants and coal-fired or nuclear power plants.
 Governmental regulation such as environmental protection can influence decisions
on these projects.
4) Infrastructure and Heavy Construction
 Infrastructure and heavy construction includes projects such as highways, tunnels,
bridges, pipelines, drainage systems and sewage treatment plants.
 Most of these projects are publicly owned and therefore financed either through
bonds or taxes.
 This category of construction is characterized by a high degree of mechanization,
which has gradually replaced some labor intensive operations.

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1.4 CHARACTERISTICS OF CONSTRUCTION INDUSTRY / PROJECT

 The construction project is defined as all other projects by the following characteristics:
 Defined goal or objective  Defined beginning and end
 Specific tasks to be performed  Resources being consumed.
 The goal of construction project is to build something.
 The difference of the construction industry’s projects from other industries’ projects is that
its projects are large, built on-site, and generally unique.
 Time, money, labor, equipment, and, materials are all examples of the kinds of
resources that are consumed by the construction project.
 Projects begin with a stated goal established by the owner/investor and accomplished
by the project team.
 As the team begins to design, estimate, and plan out the project, the members learn
more about the project than was known when the goal was first established.
 This often leads to a redefinition of the stated project goals.
 Regarding to the specific characteristics of the construction industry as:
 the construction industry is the largest industry in the world
 it is more of a service than a manufacturing industry
 growth in this industry in fact is an indicator of the economic conditions of a
country;
 the construction industry consumes a wide employment circle of labor
 most construction projects exhibit cost overruns, time extensions, and conflicts
among parties
 the construction industry is more challenging than other industries due to its unique
nature
 every project is one-of a kind
 many conflicting parties are involved
 projects are constrained by time, money and quality and high risk
 is generated the need of the organization and management of the processes
implemented throughout the lifecycle of the construction project by the arising of
the investment idea to its completion.
 In general, the construction industry is more challenging than other industries due to:
 Its unique nature
 every project is one-of a kind
 many conflicting parties are involved
 Projects are constrained by time, money and quality and high risk.

1.5 PARTIES IN CONSTRUCTION INDUSTRY

 Basically, Project Management theories define many different participants/roles in a
construction project.
 The persons recognized by the law as participants in the construction process with their
specific obligations are:
 Building Owner/Investor  Design and Technology manager

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 Designers  Site manager

 Planning manager  Other services subcontractor
 Technical assistant/controller  Mechanical services subcontractor
 Contractor  Fire services subcontractor
 Project manager  Transportation subcontractor
 Supply manager  Electrical services subcontractor, etc.
 Supplier of Plant and Equipment
 All these participants/roles can be joined into only three categories of actors:
 owner
 Architect-engineer (design professional)
 General contractor.
 Then each actor can develop as many roles as necessary:

Figure Construction Management Process and Relationships with Project’s Participants

1) THE OWNER / INVESTOR (CLIENT)

 The owner is the individual or organization for whom a project is to be built under a
contract.
 The owner/investor, whether public or private, is the originating party that gets the project
financed, designed, and built.

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 They need to select qualified designers, consultants, and contractors.

 In order to achieve success on a project, owners/investors need to define accurately
the projects objectives.
 They need to establish a reasonable and balanced scope, budget, and schedule.
 Depending on the owners’/investors’ capabilities, they may handle all or portions of
planning, project management, design, engineering, procurement, and construction.
 The owner/investor engages architects, engineering firms, and contractors as necessary to
accomplish the desired work.
 Public owners/investors are public bodies of some kind ranging from agencies from the
country level to the municipal level.
 Public owners/investors must proceed in accordance with applicable statutes and
administrative directives pertaining to advertising for bids, bidding procedure, contracts
and other matters relating to the design and construction process.
 Private owners/investors may be individuals, partnerships, corporations.
 Most private owners/investors have facilities or projects built for their own use or to
be sold, operated, leased, or rented to others.
 Some private owners do not intend to be the end users of the constructed facility;
rather, they plan to sell, lease or rent the completed structure to others.

2) THE DESIGN PROFESSIONALS

 The design professionals are architects, engineers, and design consultants.

 The major role of the design professional is to interpret or assist the owner/investor in
developing the project’s scope, budget, and schedule and to prepare construction
documents.
 Depending on the size and sophistication of the owner/investor, the design
professional can be part of the owner’s/investor’s group or an independent, hired for
the project.
 In some cases design professional and construction contractor together form a design-
build company.

Architect
 An architect is an individual who plans and design buildings and their associated
landscaping.
 Architects mostly rely on consulting engineers for structural, electrical, and mechanical
work.
Engineer
 The term engineer usually refers to an individual or a firm engaged in the design or other
work associated with the design or construction.
 Design engineers are usually classified as civil, electrical, mechanical depending upon
their specialty.
Engineering-Construction Firm
 An engineering-construction firm is a type of organization the combines both
architect/engineering and construction contracting.

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 This type of company has the ability of executing a complete design-build sequence.

 The term ‘architect-engineer’ is used to refer to the design professional, regardless of the
applicable specialty or the relationship between the architect-engineer and the owner.
 Designers are responsible for the preparation of the project design and, if explicitly
assigned by the investor, for carrying out preliminary research and investigation.
 They also exercise author’s supervision for compliance of the construction works
with the design, and are authorized to issue instructions in that respect, which are
mandatory for other participants in the process.

3) CONTRACTORS / THE CONSTRUCTION PROFESSIONALS

 The constructions Professional are the parties that responsible for constructing the
project.
 In traditional management where the owner/investor, design professional, and
contractors are separate companies, the contractor would be termed a prime
contractor.
 The prime contractor is responsible for delivering a complete project in accordance
with the contract documents.
 In most cases, the prime contractor divides the work among many specialty
contractors called subcontractors as shown in Figure .

Figure Contractor hierarchy

 The General Contractor is the firm that is in prime contract with the

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owner/investor for the construction of a project, either in its entirety or for

some designated portion thereof.
 Under the single-contract system, the owner/investor awards construction
of the entire project to one prime contractor.
 In this situation, the contractor brings together all the elements and inputs
of the construction process into a single, coordinated effort, and assumes full,
centralized responsibility for the delivery of the finished job, constructed
in accordance with the contract documents.
 The prime contractor is fully responsible to the owner/investor for the
performance of the subcontractors and that of other third parties to the
construction contract.
 When separate contracts are used several independent contractors work
on the project simultaneously, and each of them is responsible for a
designated portion of the work.
 Each contractor is in contact with the owner/investor and operates
independently of the others.
 Hence, each of these contractors is a prime contractor.
 Responsibility for coordination of these contractors may be undertaken by
the owner, the architect-engineer, a construction manager, or one of the
prime contractors who is paid extra to perform certain overall job
management duties.
 The contractor is a registered trader.
 The contractor is responsible for execution of the works in compliance with the
approved design and permits, and the legal requirements concerning construction
works, methods, materials and products, as well as for preparing the “as-built”
documentation for the works, if this role is explicitly assigned to him under the
construction contract.

THE CONSTRUCTION PROFESSIONALS

The Project Manager
 The project manager is the individual charged with the overall coordination of the
entire construction program for the owner/investor.
 These include planning, design, procurement, and construction.
 Among his/her duties:
o Clear definitions of the goals of the project
o Investigate alternative solutions for the occurred problems
o Develop a detailed plan to make the selected program reality
o Implement the plan and control the project.

The Construction Manager

 The construction manager is a specialized firm or organization which administrates the
on-site erection activities and the consulting services required by the owner/investor
from planning through design and construction to commissioning.
 The construction manager is responsible for design coordination, proper selection of

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materials and methods of construction, contracts preparation for award, cost and
scheduling information and control.
 More often the Project manager and the Construction manager are the same person
or company that performs initiatives and obligations of both.
Structural engineer
 The structural engineer is an individual possessing the special capacity for exercising
technical control over the structural part of detailed project designs (technical and
execution designs).
 He must also countersign the “as-built” documentation.
Technical controller
 The technical controller is an individual with technical education managing the
execution of the construction works on behalf of the contractor.
 If the works are executed by the investor himself, he is obliged to appoint a
technical controller.
 Technical controllers are also responsible for the supervision of projects, where no
consultant has been appointed by the investor.

4) CONSULTANT
 The supervisor (consultant or technical controller):
 Is responsible for the lawful commencement and execution of the construction works,
the completeness and correctness of all acts and protocols executed during the
construction, the fitness of the completed works for putting into operation, the
assessment of their energy efficiency and their accessibility to disabled persons;
 Is obliged to inform any breach of the technical norms and regulations it has identified in
the course of the construction works
 Is authorized by law to certify the order book for the construction works and to issue
mandatory instructions and orders to the contractor
 Must sign almost all of the acts and protocols executed in the course of the construction
works and issue a final report to the investor upon their completion;
 Is jointly liable with the contractor for any damage resulting from breach of the technical
norms and regulations, or deviation from the approved designs.
 When appointing a consultant, investors should bear in mind that a consultant cannot
act as a supervisor or carry out the compliance evaluation of designs for projects in
which it or its employees or related parties are involved as designers, contractors or
suppliers.

1.6CONSULTING ORGANIZATIONS

1.6.1CONSULTING ENGINEER RESPONSIBILITIES

A full professional service by a Consulting Engineer to a Client for a project comprises five
main stages, as follows: 
1. investigation and report 
2. detailed design and preparation of contract documents 

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3. arranging a contract 
4. services-during-construction 
5. acceptance of Works, commissioning of systems, and resolution of final account.

Roles and responsibility of a consulting civil engineer includes:

1) investigation
 Most consultations usually require some study and investigation which involve analysis and
simple computations while others may require field strips to observe and inspect equipment
or structures.
 Still again, they may involve a review of studies, reports, investigations or communications
prepared by other engineers or by the clients’ management.
2) feasibility reports
 These reports are concerned with determining the feasibility of some projects while
presenting the results of surveys, studies and investigation carried out to confirm the
engineering solution to be adopted in line with the financial cost.
 A feasibility study will usually include such items as purpose of study, requirements and
needs of project, alternate solutions, estimated construction cost, recommendations and
conclusion.
3) Engineering design
 Engineering design is the process of determining the physical characteristics and dimensions
of a structure or project to be constructed or manufactured.
 These characteristics and dimensions are presented graphically on drawings, commonly
referred to as blue prints by the layman.
 Such drawings, or plans, are supplemented by written documents called specifications.
 Plans and specifications are used to direct the contractor or the manufacturer on the details of
work expected from him.
 Frequently, the design process includes the preparation of detailed lists of materials called
bill of quantities which is used to procure all the materials needed for the construction or
manufacturing work.
4) Procurement
 The consulting civil engineer often assists the client in the selection of contractors or in the
purchase of materials for the award of contracts.
 Procurement usually involves the receipt of a proposal from one or more material suppliers
and selection is made on a competitive or a negotiated basis.
 On construction projects, particularly for government organizations, contracts are usually
awarded on the basis of competitive bidding while the engineer will normally prepare the
contract documents in addition to drawings and specifications in constriction with the client’s
legal officer.
 With the plans, specifications and contract documents, bids are solicited from contractors or
manufacturers through public notices issued in accordance with legal requirements.

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 After the receipt of all interested tenders, bids are opened publicly, as a rule, read and
tabulated by the consulting civil engineer who will then makes his recommendations to the
client.
5) Construction supervision
 This activity consists of two parts general supervision and resident supervision.
 General supervision involves the following:
a) periodic visits to site
b) consultation with the owner/client
c) interpretation of plans and specifications
d) checking working drawings and data
e) processing and certification of contractor’s payment estimates
f) preparation of amendments to contractor’s contract
g) final inspection of project
h) preparation of as-built drawings
 Resident supervision however requires the consulting engineer to send a representative or a
resident engineer to the site of the project.
 The resident engineer is responsible for detailed supervision and inspection to ensure that the
project is constructed according to the plans and speficification.
 In addition, also coordinates and expedites the activities of the contractors.
6) Legal services
 Often consulting civil engineers are requested to function as expert witnesses in the court
proceedings and to advise clients and lawyers on engineering matters involved in legal
procedures.
7) Other services
 The list of services outlined above is by no means complete and a compilation of a complete
list of services would be formidable tasks and would serve no useful purpose.
 However, the listings given here adequately cover the range of services performed by a
consulting civil engineer.

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