Construction Management: Principles & Practices

By Jagdish Suman

This book is a comprehensive treatment of Construction Management that encompasses all aspects of this vast subject. And makes this book a useful textbook & reference book for students and teachers alike.
Most publications deal with just one or more aspects of construction management, such as scheduling or cost management, without providing an overall understanding of construction management in the construction industry.
This book is intended to fill this gap by providing an overview of all types of activities and subject matters required in managing a construction project. These items include but not limited to the various contract types, bidding process, change management, as well as contract negotiations. The various materials & testing and required permits are also discussed
The book follows a sequential arrangement of its chapters similar to the sequence of activities on a construction project. Author is an experienced practicing engineer and has managed several projects successfully. And hands on experience gained by the author have been added in the various chapters of this book. And that's what separates this book from other books on this subject.
This book can be useful to the teachers and students of Construction Management as well as to managers of financial institutions who finance construction projects. In addition, this book has enough material on offshore engineering to support a three semester hours’ worth credit course.

• Language: English
• Publisher: JC Suman
• Release date: Oct 30, 2021
• ISBN: 9780578337579

Book preview

Construction Management Primer

Jagdish C Suman

A comprehensive treatment of Construction Management based on hands on experience, that encompasses all aspects of this vast subject & makes this book a useful text & reference book for students, teachers, and construction managers alike.

(Second Edition)

Dedicated

to

The Universal Builder

&

My Family — My Universe

Copyright

Copyright © 2021 Jagdish C Suman. All rights reserved.

Copyright Registration #: TXu  2-287-392

(Issued by United States Register of Copyrights and Director)

ISBN # 978-0-578-33757-9

Title: Construction Management Principles & Practices

Author: Jagdish C. Suman

Published by: Jagdish C Suman

(Second Edition)

Text Description automatically generated

Preface-1

This book is a result of many years of actual hands-on experience and has been written with the specific goal of helping students and practitioners of construction management. It is envisioned that it will also be useful to executives with general business or financial backgrounds to receive an introduction to the basics of construction management. And to help them appreciate the vast expanse of building an energy infrastructure onshore as well as offshore, from exploration, transportation to production and refining of hydrocarbons and petrochemical.

Construction management requires multidisciplinary technical expertise, combined with extraordinary patience and diplomacy, to successfully manage construction projects on time and under budget. The basic principles of construction management are applicable to all types of energy infrastructure. However, technical knowledge specific to the infrastructure project at hand will go a long way towards the successful completion of a project.

Most publications deal with one or more aspects of construction management, such as scheduling or cost management, without providing an overall understanding of construction management in the construction energy industry. This book is intended to fill this gap by providing an overview of all types of energy construction, the various contract types, bidding process, as well as contract negotiations. The book follows a sequential arrangement of its chapters similar to the sequence of activities on a construction project.

Specifics such Scheduling and Cost Management fall under the heading of Project Controls in the construction management field, but there are many other constituents of construction management, including Quality Control and Safety, which have been dealt with in this book as well.

Construction Management is performed by a team of experts headed by a Construction Manager. In oil and gas exploration, production, refining and petrochemical projects, the Construction Manager generally reports to a Project Manager or a Project Director.

Energy infrastructure projects are typically multi-million-dollar projects with large construction management organizations. Whether a project is built onshore or offshore adds an additional layer of complexity.

Generally, the construction industry infrastructure is divided into three types:

I. Industrial

1. Onshore (E&P facilities, refineries, petrochemical plants, etc.)

2. Offshore (oil and gas facilities, gathering systems, pipelines, etc.)

II. Commercial

1. Institutional

2. Business (hotels and apartments, high-rise buildings)5

III. Residential (single or multi-story)

IV. Infrastructure (Bridges, Tunnels & Shipping Terminals)

Regardless of the type of construction, the basics of construction management remain the same. However, offshore construction is very different from onshore construction in size, shape, construction techniques, materials, equipment, risks and especially the cost. Therefore, it is important to understand why it is so. And for this reason, the book has devoted several chapters identifying the various elements of offshore projects to impart this know-how:

Offshore platforms

Offshore pipelines

Shipping terminals

The most common principles/concepts of Construction Management are universally applicable to all type of projects onshore or offshore. These concepts are discussed in detail in the following chapters. This information should enable the reader to gain a basic understanding of construction management as it relates to energy infrastructure.

It is assumed in the book that we are dealing with a relatively large industrial project (e.g., offshore platform, power plant, petrochemical complex), which would require a fully staffed organization with all construction management specialties. Therefore, knowledge of the material provided in the book is a minimum requirement for a construction manager of such a large project. While the same construction management principles apply for smaller projects, some of these techniques would need customization to suit the size and type of a project, however.

Preface-2

This second edition contains several valuable changes, additions, and revisions in this book. Chapter-1 through Chapter-3 have been revised and several items added in them. The various construction equipment & Geotechnical information for site preparation and foundations have been added in Chapter-3. Chapter 5 through 19 have been thoroughly revised and several relevant information have been added to supplement the existing materials. Additional construction materials information has been added in Chapter 9. Chapter 10 (Project Execution) has been thoroughly revised and enlarged with all aspects of project execution processes included. Chapter 13 (Cost Management) has also been enhanced and revised to include such topics as estimate types & estimate basis, contingency, and escalations allowances, etc. Similarly, other chapters dealing with such diverse topics like negotiations and qualifications of successful negotiators; progress payments & their accuracy determination; the various ways to deal with conflicts, including litigations & arbitrations. These additions and revisions were based my own teaching experiences and by finding the inadequacies in the book to cover certain important topics. And fulfillment of these requirements has led to the addition of more than fifty pages in this new Edition (2) of this book, as compare with the first edition.

Any suggestion for improving the book would be very much appreciated

JC Suman

Houston, Texas, USA.

July 19, 2022

Acknowledgements

First of all, I am thankful to those who placed their trust in me and gave me opportunities to acquire relevant professional experience during my career. And now consequently, I am able to share this knowledge with the students of construction and construction management.

My thanks to the various industry experts and academicians, who were kind enough to give their time and valuable advice for improvements in this book. Special thanks to Professor Kris Asper, Dean of the Center of Excellence, Construction Engineering & Management Technology, Houston Community College, for his review of the manuscript and valuable advice.

Special thanks to Pramod Kulkarni, an accomplished editor with PennWell Publishing, who was kind enough to help edit the book into its first draft.

I am especially indebted to my daughters Sonia and Monica, for helping finalize and format the final manuscript of the book to meet the specific requirements of the publisher, as well as their valuable advice throughout the preparation of the book.

And finally, I am indebted to my beloved wife Anita, my energizer, and the backbone of the family; and my lovely children, Sonia, Monica and Kris, without whose encouragement and valuable contributions, this book would not have been possible. And how could I forget my grandkids, Sachin, Neha, Sapna & Dhyan, who maintained peace during the working sessions of this book

Table of Contents

Construction Management Primer

Dedicated

Copyright

Preface-1

Preface-2

Acknowledgements

CHAPTER 1

Introduction

PROJECT DEVELOPMENT STAGES

▪      Conceptual Phase

▪      FEED (Front End Engineering & Design)

▪      Detail Engineering

▪      

Execution phase

MANAGEMENT ITEMS & TOOLS

When does the construction phase start?

CHAPTER 2

DEFINITIONS &TERMINOLOGY

▪      Construction Manager

▪      Budget

▪      Bid

Bid Types

▪      Contractor

▪      Contract

THE VARIOUS TYPES OF CONTRACTS

▪      Lump Sum

▪      Cost-Plus-Fee

▪      Guaranteed Maximum Price:

▪      Unit Price

▪      Lump Sum-Turnkey

▪      Engineering, Procurement, Construction and Management (EPCM)

▪      Engineering, Procurement, and Construction (EPC)

Project Controls

▪      Project Cost Controls

▪      Project Schedule Controls

▪      Health, Safety and Environment (HSE)

Quality Assurance & Quality Contro

▪      Risk

Stakeholders and Owner/Client

▪      Home Office

▪      Field Office

Temporary Facilities and Infrastructure

Management of Change (MOC)

▪      Shop Drawings

▪      As-Built Drawings

▪      Shop Inspection

▪      Logistics

▪      Occupational Safety and Health Administration (OSHA)

▪      Environmental Protection Agency (EPA)

▪      Progress Payment

▪      Change Orders

▪      NCR (NON-Conformance Report)

▪      Mechanical Completion

▪      Pre-Commissioning

▪      Commissioning

▪      Hand-Over Process

Chapter-3

Construction Types & Techniques

Based on Project Location:

Based on Usage of Facilities:

▪      Offshore Construction

▪      Offshore platforms

▪      Offshore pipelines

▪      Shipping-marine terminal structures

Construction Equipment

Onshore Construction

Major equipment

Small equipment:

Geotechnical information for site preparation & foundations

Chapter 4

Offshore Construction

▪      A. Offshore Platforms

▪      Concept Development

Types of Platforms

▪      Based on Engineering Design Concepts

▪      Based on Platform Support Configuration

▪      Based on Platform Use/Functionality

Anatomy of an Offshore Platform Structure

▪      Top Sides/Deck

▪      Jacket

▪      Foundation & Anchorage

▪      Concrete Jacket

▪      Single-leg Platform (Monopod)

▪      Tension leg platform (TLP)

▪      Spar Platforms

▪      1. Conventional Spar

▪      Compliant Towers

▪      Floating Production Systems

▪      Semi-submersible Platform

▪      Drill Ships

▪      Platform Anchorage/Foundation

▪      Pile Installation

PLATFORM- CONSTRUCTION & INSTALLATION

Fabrication & Transportation:

▪      Towing & Load-out

▪      Jacket In-Place Design

▪      Load-out

▪      Transportation (See fig.15)

▪      Topsides Installation

▪      Single-lift Method:

▪      Multi-Lift Method

▪      Float Over Method

Chapter 5

OFFSHORE PIPELINES

▪      Pipelines

Fabrication

▪      Pipe-in-Pipe

▪      Corrosion Protection

Installation of Offshore Pipelines

▪      Installation Techniques

▪      Reel-lay

▪      S-Lay

▪      J-Lay

Components of an Offshore Pipeline System

▪      Risers

▪      Pig Launchers and Receivers

▪      Mechanical Support Equipment

▪      Manifold Systems

Quality Control in Pipeline Fabrication

▪      Material Defects

▪      Corrosion

▪      Welding Issues

▪      Welding Defects & Failures

CHAPTER 6

OFFSHORE CONSTRUCTION

Ports, Marine Docks & Shipping Terminals

Main Components of a Terminal

▪      Super-Structure

▪      Vertical supports/piles

Generalized Anchor Mooring Systems.

Permanent Anchor Mooring Systems

▪      Pile moorings

▪      Travelling Mooring

▪      SPM (Single Point Mooring).

▪      Buoy

CALM        (Catenary Anchor Leg Mooring)

SALM       (Single Anchor Leg Mooring)

ALT        (Articulate Loading Tower)

RMD       (Ready Made Dolphin/Fixed Tower)

Anchor Types

Mushroom anchors

▪      Dead Weight:

▪      Pyramid anchors:

▪      Screw-in Anchors

Multiple Anchor mooring

Mooring Lines/Hawsers

Mooring line Material

Cargo Loading & Unloading Systems

Fire and Safety

Administrative and Operational Infrastructure and Facilities

Storage Facilities

Turning Basin

Chapter-7

Onshore Construction

Industrial Construction

Onshore Pipelines

▪      Pipeline Corridor

Commercial Construction

Residential Construction

Public Infrastructure

Chapter 8

Staging of Construction

I.      Pre-Construction

II.      Construction

III.      Post Construction

Offshore Construction

Site Reconnaissance

▪      Support Facilities Identification:

Material Related Activities

▪      Welding

▪      Concrete

▪      Equipment Related Activities

▪      Approvals & Certifications

Onshore Construction

Project construction staging can be divided into three main sub-stages:

▪      Pre-Construction:

▪      Construction:

▪      Post Construction

▪      Site Related

▪      Material Related

▪      Equipment related

▪      Approvals & Certificates

▪      Site Related

▪      Support Facilities Identification

▪      Material Related Activities

Welding

▪      Concrete

▪      Equipment Related

▪      Approvals & Certifications

CHAPTER 9

CONSTRUTION MATERIALS

Testing & Certifications of Materials & Equipment

▪      Concrete

▪      Cement:

▪      Types of Cement

▪      Soft wood:

▪      Hard wood:

▪      Concrete

▪      Steel

▪      Equipment

CONCRETE TESTS

▪      SLUMP TEST

▪      Compressive Strength Test

▪      Water Permeability test

STEEL TESTS

▪      Tensile strength

▪      Buckling

▪      Fracture toughness

▪      Hardness

▪      Tensile Testing

▪      Reinforcing bars

▪      Buckling

▪      HARDNESS

Electrical & Mechanical Equipment

Vessels

CHAPTER 10

Project Execution

Project Execution Plan (PEP)

▪      SCOPE

▪      Scope Creep

Home Office Execution

▪      Constructability Input

Stick Built & Modular Construction

▪      Human Factor Engineering

▪      Material & Equipment Availability

▪      Vendor Location and Capabilities Survey

Risk Identification, Assessment/Ranking & Mitigation

▪      Weather Window

▪      Equipment Availability

▪      Sparing Philosophy

▪      Long Lead Items

▪      Hazop & Hazid

Field Execution

Mobilization and De-mobilization

Temporary Infrastructure & Facilities

Warehousing & Storage

Preservation of Stored items

Construction/Assembly Phase

Electrical and Electronic Equipment

Mechanical Equipment

Maintenance Facilities

Field Office Set-ups

•      Changes/modifications to original design

Field Engineering

Changes/Modifications to Original Design

Shop Drawings

As-Built Drawings

Permits

Permits from the Government/Public Authorities

Permits from the Site Management

▪      Hot Permits

▪      Cold Permits

Management of Change (MOC)

Quality Assurance and Quality Control (QA/QC)

Meeting Minutes

Vendor Communications

Engineering Calculations and Drawings

Vendor Fabrication

Field Testing and Start up Activities

Sub-Contract Administration

Vendor Management

Design criteria and specifications

Procurement Management

Contractor Management &Progress Payments

Accuracy of Progress Measurement

Earned Value Management

Negotiations

Desired qualities of a good negotiator:

▪      Patience

▪      Active Listening

▪      Emotional Control

▪      Verbal Communication

▪      Problem Solving

▪      Ethics and Reliability

▪      Eagerness Assessment and Control

▪      Firmness with flexibility

Managing Labor & Community Relations

Construction Disputes

Managing Disputes & Resolution Processes

▪      Adjudication.

▪      Mediation.

▪      Arbitration.

▪      Expert involvement and

▪      Court proceedings/litigation.

Adjudication

Expert Determination

Litigation

Mediation

Arbitration

Chapter 11

Communications

▪      Verbal communications

▪      Visual communications

▪      Written communications

▪      External (government & private entity permissions & certifications)

▪      Intra-PMT (Interface Management)

Verbal Communications

Visual Communications

Written Communications

▪      Meeting Minutes

▪      Drawings

▪      Specifications

▪      Contract Documents

▪      Progress Reports

▪      Change Orders/Deviations

▪      Management of Change

▪      Cost Reports

▪      Interface Management

Regulatory Compliance

▪      Organization Chart

Chapter 12

Mobilization to Construction Site

Facilities

▪      Lodging, Boarding & Transportation

▪      Infrastructure

▪      Power

Temporary Facilities

Permanent Facilities

▪      Infrastructure

▪      Temporary Infrastructure

▪      Permanent Infrastructure

▪      Power Supply

▪      Temporary Power

▪      Permanent Power Supply

▪      Entertainment Facilities

▪      Health Care Facilities

Chapter 13

Project Cost Management

▪      Project was finished within the projected schedule.

▪      Project was finished within the defined budget.

▪      Project met or exceeded the owner’s specifications & expectations

▪      Project was accomplished without any HSE violations.

Basis of Estimate (BOE)

▪      What is an Estimate?

Basis of Estimate (BOE)

▪      Cost Estimate Types

Cost Estimate-Categories

▪      Level of project definition/maturity,

▪      End usage of the estimate,

▪      Estimating methodology used, and

▪      Effort and time needed to prepare the estimate

▪      Project scope definition,

▪      Project specifications,

▪      Percentage of completeness of engineering

▪      Lessons learned from past projects,

▪      Risk identification and ranking

Cost Structuring

▪      Fixed costs

▪      Variable costs

▪      Direct costs

▪      Indirect costs

Labor Productivity

Field In-directs and Overheads

Owner’s Costs

Earned Value Management

Contingency & Allowances

Contingency

Allowances:

Allowances are extra money allocated for known items with unknown quantiles. For example, Design Allowance; Material take-off Allowance, Price escalation allowance, etc. These allowances are generally delineated in the in the basis of estimate (BOE). It should be remembered that allowances are NOT a part of Contingency as discussed above.

▪      Design Allowances

▪      Material Takeoff Allowances

Chapter 14

Project Planning & Scheduling Management

Project Planning

Scheduling Process

Planning & Scheduling Terminology

▪      Level of Accuracy

▪      Milestones

▪      Critical Path

▪      Units of Measurement

▪      Organizational Procedures

▪      Control Threshold

Completion of Scheduling Process

Work Breakdown Structure

▪      Creating a Network Model

▪      Arranging WBS Activities

▪      Establish Activity Relationships

▪      Assigning Durations and Resources

▪      Early/Late Start & Finish

▪      Identifying Critical Path

Association for the Advancement of Cost Engineers – International (AACE-International)

Chapter 15

Quality Assurance & Quality Control

"Quality assurance

Quality assurance

Quality Assurance

1.      "Fit for purpose

Quality Control

Total Quality Management (TQM)

Six-Sigma

Construction QA/QC Plans

▪      Non-Conformance Report (NCR

General Construction Inspection & Verification Requirements

Project QA/QC Organization

Material Identification & Traceability Reports

Inspection & Testing Reports

Final Inspection

Contractor’s Submittals

▪      As-Built Drawings

Quality Control Program

Essential Elements of a QCP Process

Pre-construction Activities of a QCP Program:

During Construction Activities (Construction Field QCP Program)

▪      Quality Assurance (QA) Process

▪      Closeout

▪      Post-Construction

▪      Attachments to the PQM Final Report

▪      Demobilization

Chapter 16

Health Safety & Environment

Regulatory Agencies

▪      Occupational Safety & Health Administration (OSHA)

▪      Environmental Protection Agency (EPA)

▪      Nuclear Regulatory Commission (NRC)

▪      Mining Safety & Health Administration (MSHA),

▪      Mineral Management Administration (MMA), etc.

▪      The PPE consists of:

LOGOUT-TAGOUT (LOTO)

OSHA standards for other industries such as Marine Terminals is 1917 Subpart C, for Electrical Construction; is 1926 Subpart K, Electric Power Transmission and Distribution is 1926 Subpart V, and so on.

Chapter 17

Mechanical Completion &

Pre-commissioning

Chapter 18

Hook -up & Commissioning

Preparing for Commissioning

Main Commissioning Activities

Hydro-testing

▪      Flushing of Lines

Hook-up and Commissioning of Offshore Projects

▪      Constraints and Potential Problems

▪      Handover Process

▪      Start Up Process.

Chapter 19

Project Close out & Hand-Over of Facilities

Project Look-Back

Expectations versus Reality-Review

Project Close-out Report

Punch List

What is Included in the Project Closeout Process?

Chapter 20

Production Phase Tune-up

▪      Growth stage

▪      Maturity, and

▪      Decline

▪      All owners want to make sure that the project cost is recovered as soon as possible without incurring too much additional expenses.

Bibliography

Index

About the Author

CHAPTER 1

Introduction

Construction Management is a multi-disciplinary profession, requiring a unique blend of science, technology, and even liberal arts. Most construction management personnel come from engineering backgrounds, Civil Engineering in particular. However, in addition to a strong technical background, the Construction Management professional should be familiar with disciplines such as economics, sociology, psychology, law, and communications.

Typically, a Construction Manager oversees the overall Construction Project and heads a Construction Management organization. Depending upon the size and complexity of the project, the Construction Management organization includes several subject matter experts (SMEs), such as a cost engineer; scheduler; quality manager; safety engineer, and others. As the head of this organization, the Construction Manager is responsible for bringing the engineered design on drawings to a physical reality, such as a building, a bridge, or a power plant.

Many engineered objects around us (e.g., houses, cars, roads, bridges, buildings, airplanes, ships) as well as smaller devices such as watches, computers, and so on, have passed through four stages of evolution, before reaching the market. These stages/phases are¹:

PROJECT DEVELOPMENT STAGES

Conceptual Phase

This is the first stage of any project, wherein an idea is born out of necessity or strategic thinking by an individual or business to produce something to fill a gap in the market.

FEED (Front End Engineering & Design)

As this idea catches momentum based on the interest of management, engineers explore it further for its feasibility as a possible project by performing preliminary engineering and cost analysis.

Detail Engineering

Based on the FEED results, organization may end the project, or decide to proceed with the project to build it. In the later scenario, the next phase is Detail Engineering, wherein engineering is finalized, and drawings are prepared. And thereafter the project is awarded to a builder/contractor for construction.

Execution phase

(Detail engineering, fabrication, construction, commissioning & start up)

In the oil and gas industry, the Execution phase starts before the actual end of the Detail Design. This is when the Construction Management organization is established, and the contractor is selected for construction.

While all phases as stipulated above are equally important, construction part of the fourth phase is where the proverbial Rubber meets the Road cliché’ applies. It is important to note that this is the phase where the initial thoughts/concepts are refined, and the engineering drawings and specifications are transformed into a physical reality.

Each of these four phases require precise planning and management of activities to

achieve successful completion before moving into the next phase. Additionally, planning and management required for Construction requires even more precision. The reason for this additional emphasis is that any mistakes made in first three

phases, although not accepted as routine, can be rectified on paper easily and with little impact on cost than fixing a construction mistake.

Construction phase mistakes can be as much as ten to several hundred times costlier as compared with those in other phases, especially in the offshore construction.

The following are a couple of real-life examples wherein construction mistakes ended up costing the owners millions of dollars to correct. Had these mistakes been identified during earlier phases, it would have cost a fraction of what it cost to fix these after the construction.

In first instance, a subsea pipeline design had assumed the gas to be transported via this offshore pipeline to be sweet or containing no H2S gas. This was an erroneous assumption and ended up costing the company tens of million dollars to replace the pipeline with one that was suitable for transporting sour gas containing traces of H2S gas.

In the second instance, the mistake was a result of faulty pipeline fabrication. Pipeline cladding installed inside the line-pipe separated, while the pipeline was in operation. Consequently, this pipeline corroded and had to be abandoned. A new pipeline system had to be installed, costing the company hundreds of million dollars. If the mistake had been caught during fabrication, the cost would have been perhaps one tenth of what it eventually cost to replace the pipeline.

All projects go through the same four phases of evolution, yet each project has a distinct set