Post on 03-Feb-2018
“Managing ConstructionManaging Construction Claims”
Calvey Consulting, LLC8473 Settlers PassageCleveland, OH 44141
440-740-1132
Managing Construction ClaimsManaging Construction Claims
Why are Claims are disputed.Why are Claims are disputed.What is Typical ClaimWhat does a Consultant use to develop aWhat does a Consultant use to develop a Claim.What are the Key ComponentsWhat are the Key Components. What are Accepted Methods of Analysis
Calvey Consulting, LLC 440-740-1132
h i l i i dWhy are Construction Claims Disputed ?The Issues are complex.The Issues are complex.The Claims are loosely documented.Breakdown in communicationBreakdown in communication.There is an honest difference in opinion. No budget dollarsNo budget dollars.
Calvey Consulting, LLC 440-740-1132
What is a “Typical Construction Claim”?
Claimant – Multi Prime ContractorClaimant Multi Prime ContractorMoneyTimeTimeSource of the Dispute – Third Party No Exact AccountingNo Exact Accounting
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What does a Claims Consultantuse to develop his analysis?
ContractContractProject SchedulesPay ApplicationsPay ApplicationsCertified PayrollsProject Meeting noteProject Meeting noteDaily Logs
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What are the Key Components of a Typical Contractor’s Claim?
The Planned ScheduleThe Planned Schedule The Actual SchedulePredecessor DelayPredecessor DelayImpact on the ContractorQuantify the DamagesQuantify the Damages
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Methods of Delay AnalysisTi I A l iTime Impact Analysis
Impacted As PlannedImpacted As PlannedAdjusted As BuiltWindowsWindowsConstructive Acceleration
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Calculating Damages
Extension of General ConditionsExtension of General ConditionsExtension of Home Office OverheadEscalationEscalationLoss of Productivity
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AACE - Purpose of Recommended Practice
Identify Lost Productivity EstimatingIdentify Lost Productivity Estimating MethodologiesRank Order the MethodologiesgDefine and Discuss Each MethodologyIdentify Selected Studies Applicable to EachIdentify Selected Studies Applicable to Each Methodology
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Methods of Estimating Lost ProductivityMethods of Estimating Lost Productivity
Project Specific StudiesProject Specific StudiesProject Comparison StudiesSpecialty Industry StudiesSpecialty Industry StudiesGeneral Industry StudiesCost BasisCost Basis
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What is Productivity?What is Productivity?
Productivity =Productivity Output (units completed)
Input (work or equipment hours)Input (work or equipment hours)
Productivity Factor =Productivity Factor = Actual ProductivityBaseline or PlannedBaseline or Planned
Productivity
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Common Causes of Lost ProductivityCommon Causes of Lost Productivity
Acceleration (directed or constructive)Acceleration (directed or constructive)Crowding of labor or stacking of tradesOver manningOver manningLearning CurveExcessive overtimeExcessive overtimeAdverse or unusually severe weatherDilution of SupervisionDilution of Supervision
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Common Causes of Lost ProductivityCommon Causes of Lost Productivity
Changes, ripple impact, cumulative impact ofChanges, ripple impact, cumulative impact of multiple changes and rework Defective engineering, recycle and/or reworkg g, yAbsenteeism and the missing man syndromeCraft turnoverCraft turnoverMaterial, tools and equipment shortagesSite or work area access restrictionsSite or work area access restrictions
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Project Specific StudiesProject Specific Studies
Measured Miles StudyMeasured Miles StudyEarned Value AnalysisWork Sampling MethodWork Sampling MethodCraftsmen Questionnaire Sampling Method
H l i i ?How long is it?
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Measured Mile – Physical UnitsMeasured Mile Physical Units
Measured Mile10 Miles of pipe installed – 1,000 manhours
100 manhours/mileImpact4 Miles of pipe installed – 640 manhours
/160 manhours/mileLoss of Productivity
60 manhours/mile60 manhours/milex4 miles
240 manhours
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240 manhours
Earned Value AnalysisEarned Value Analysis
Measured Mile70% Labor Complete – 1,000 manhours
14.3 manhours/1%Impact30% Labor Complete – 640 manhours
/ %21.3 manhours/1%Loss of Productivity
7 manhours/1%7 manhours/1%30%
240 manhours
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240 manhours
Project Specific StudiesProject Specific Studies
Measured Miles StudyMeasured Miles StudyEarned Value AnalysisWork Sampling MethodWork Sampling MethodCraftsmen Questionnaire Sampling Method
H l i i ?How long is it?
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Project Comparison StudiesProject Comparison Studies
Comparable Work StudyComparable Work StudyComparable Project Study
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Specialty Industry StudiesSpecialty Industry Studies
AccelerationAccelerationChanges, Cumulative Impact and ReworkLearning CurveLearning CurveOvertime and Shift WorkProject CharacteristicsProject CharacteristicsProject ManagementWeatherWeather
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Specialty Industry StudiesSpecialty Industry Studies
Selected StudiesSelected Studies
Weather Impact on ProductivityWeather Impact on Productivity
Overtime Impact on Productivity
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Weather Impact on ProductivityWeather Impact on Productivity
120
100
120
60
80
ffici
ency
20
40% E
f
0
20
-20 -10 0 10 20 30 40 50 60 70 80 90 100
Eff ti T t (F)
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Effective Temperature (F)
Weather Impact on Productivity (NECA Studies)
Temperature (effective) ImpactTemperature (effective) Impact
Eff ti T t R °FEfficiency
Effective Temperature Range °F%
+40 to 80 100
-20 to +20 20 – 95
80 to 100 85 - 60
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Weather Impact on ProductivityWeather Impact on Productivity
Daily Log Documentationy gFrequency (AM, Noon, PM)TemperatureWindPrecipitation (rain, snow, sleet)E i H iditExcessive Humidity
Historic DataNational Oceanic & Atmospheric AdminNational Oceanic & Atmospheric Admin. (NOAA) – National Climatic Data Center
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Overtime Industry StudiesOvertime Industry Studies
Bureau Labor Statistics – 1947 (Mfg.)Bureau Labor Statistics 1947 (Mfg.)Business Roundtable – 1980
10 year study of P&G plant projects10 year study of P&G plant projectsNational Electrical Contractors Assn.
1969 (rev 1989)1969 (rev. 1989)Construction Industry Institute – 1988
7 projects all crafts7 projects, all craftsCost Engineering Composite - 2004
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Overtime Impact on ProductivityOvertime Impact on ProductivityNECA Study
90
100
e
60
70
80
rodu
ctiv
40
50
60
% P
r
301 2 3 4 5 6 7 8 9 10 11 12
Weeks
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Weeks
Overtime Impact on ProductivityOvertime Impact on Productivity
Days – hours per day Productivity Range2 wks to 12 wks
5 - 10’s 95 % to 70 %
6 - 10’s 91 % to 62 %
5 - 12’s 85 % to 52 %6 - 12’s 75 % to 45 %
7 - 12’s 70 % to 40 %
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General Industry StudiesGeneral Industry Studies
U.S. Army Corps of Engineers ModificationU.S. Army Corps of Engineers Modification Impact Evaluation GuideMechanical Contractor’s Association of AmericaNational Electrical Contractor’s AssociationEstimating Guides
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General Industry StudiesGeneral Industry Studies
MCAAMCAA16 FactorsRange of LossRange of Loss
NECA25 Factors Checklist25 Factors ChecklistNormal – Difficult – Most Difficult
US Army Corps of EngineersUS Army Corps of EngineersNumber of FactorsNo Longer Published
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o o ge ub s ed
Cost BasisCost Basis
Total Unit Cost MethodTotal Unit Cost MethodModified Total Labor Cost MethodTotal Labor Cost MethodTotal Labor Cost Method
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Measured MileMeasured Mile
MEASURED MILE40,000
Actual Production
32,668
MEASURED MILE
30,000
er P
erce
nt
20,000
Man
hour
s pe
60% Complete: 14,762 Manhours
-
10,000
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-
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Percent based on Foundation Concrete
Court Case (A) – Clark Concrete Contractors, I 99 1 BCA ¶30 280 [1]Inc., 99-1 BCA ¶30,280 [1]
“[The Government] is correct in asserting that the work [ ] gperformed during the periods compared by [the Contractor] was not identical in each period. We would be surprised to learn that work performed inwould be surprised to learn that work performed in periods being compared is ever identical on a construction project, however. And it need not be; the
f f ffascertainment of damages for labor inefficiency is not susceptible to absolute exactness. (Citation omitted). We will accept a comparison if it is between kinds of p pwork which are reasonably alike, such that the approximations it involves will be meaningful.”
Calvey Consulting, LLC 440-740-1132