how to effectively control construction projects on site

1. COTM 3221:-Construction
Site Supervision
Chapter Five
Project Controlling and Monitoring
1

2. 1. Time Controlling and Monitoring
Session objectives
At the end of this session , students should be able to:
• To know the factors affecting construction contract
duration.
• How to record data on site.
2

3. General
•In the construction industry, the aim of project control is
to ensure the projects finish on time, within budget and
achieving other project objectives.
•It is a complex task undertaken by project managers in
practice, which involves constantly measuring progress;
evaluating plans; and taking corrective actions when
required.
3

4. …..Con’t
•The success of construction projects is highly
dependent on meeting the aim of project and objectives
within the specified quality, time and budget.
•Management plays a big role in construction projects.
Most important problems that management faces in
the projects are methods of execution, management of
workers, equipment, scheduling and money.
4

5. …Con’t
•Delay is one of the important defects in construction
industry. This failures can lead to various types of
negative affections like disputes between contractor
and client, decrease quality of work and health and
safety accidents. Therefore, there is a high necessity
for further investigation on delay factors as well
as quality and health & safety and suggesting right
actions to minimize these kinds of defects.
5

6. Categories of Factors affecting time
control
1. Management of work;
2. Economic factors;
3. Factors related to owner-client;
4. Factors related to consultant;
5. Factors related to contractor of the project;
6. Factors related to material, manpower and equipment;
7. External factors.
6

7. 1. Management causes affecting time factor
• Poor supervision and poor site management
• Inadequate front-end planning of project
• Inaccurate initial project scope and cost estimate
• Poor project management assistance
• Poor contract management
• Poor provision of information to project participants
• Inadequacy communication between design and construction parties
• Not communicating with all parties dealing the budget
• Owner interference in the project
7

8. 2. Economic causes affecting time factor
• Failure to resolve change orders and prevent them from
becoming claims/disputes.
• Inflation.
• Too many construction activities going on at the same time.
• No financial incentive to contractor to finish the project ahead
of schedule
8

9. 3. Owner/Client causes affecting time factor
• Financial difficulties of owner/Client
• Slowness of the owner’s decision-making process
• Slow financial and payment procedures adopted by the client
• Approval of drawings and material
• Increase in quantity of work (Additional works)
• Contract modifications(Replacement , addition and change)
• Long period between time of bidding and contract award
9

10. 4. Consultant related causes affecting on
time factor
•Design and work permit changes during construction
•Poor contract management
•Poor provision of information to project participants
•Inaccurate initial project scope and cost estimate
•Inadequate front-end planning of project
•Poor project management assistance
10

11. 5. Contractor related causes affecting on time
factor
• Financial difficulties of contractor
• Equipment and manpower shortage and bad distribution on site
• Inadequate contractor experience
• Low productivity of labour
• Delay in mobilization
• Rework and wastage of materials
• Poor communication with consultant and owner
• Inadequate and incompetent subcontractors
11

12. 6. Material and equipment related causes
affecting on time factor
• Unavailability of required materials in the local market on time
• Equipment availability and failure
• Delay of material delivery to site of the project
• Skilled labour shortage
• Fluctuation and escalation in prices of materials and machinery
• Lack of maintenance for the equipment
• Monopolies of construction materials supply (Steel, cement…)
12

13. 7. External related causes affecting on time
factor
•Poor and unforeseen site conditions
•Changes in laws and regulations during the project
Obstacles from government
•Severe weather problems (Hot, Cold, Snow, Rain)
•Political issues-Changes
•Poor health and safety condition on site
13

14. 2. Scheduling
Scheduling is a mechanical process for laying out the various activities of a
certain project or program along a time scale and in a proper sequence.
In other words, scheduling is the preparation of a time table or an action
plan which serves as a guide for the implementation of the activities and
computation of resources required at different stages in time.
Every construction projects are time bounded.
Due to the above nature, based on the contract time delays results to
penalties while early completion might earn rewards
There may be many reasons both foreseeable and unforeseeable, for non-
completion of a project on the intended completion time.
14

15. …Cont’d
The absence of a project time plan almost makes certain that a
project cannot be completed on schedule without incurring extra
costs.
Advantages of having a Construction plan/ Work program before
the beginning the construction project is:
Formulating directions,
Optimum utilization and orderly arrangements of resources,
Control of cost, progress and quality of executed work,
Controlling performance and motivating people
15

16. …Cont’d
Construction planning consists of the following basic
steps
Choice of technology and method of construction,
Definition of work tasks,
Creating logical relationship among individual tasks
Estimation of the required resources and durations for
individual tasks, and
16

17. The approved Master schedule, called the schedule
baseline, is a component of the overall project plan.
It provides the basis for measuring and reporting
schedule performance.
In PPA, the general conditions of contract Clause 27-32
has clear stipulation on project schedule(program),to
control duration of project .
Project Schedule
17

18. Time Control (PPA)
Clause 27.1
The Contractor shall submit the work program showing the general
methods, arrangements, order, and timing for all the activities in the
Works within the time stated in special condition of contract
Clause 27.2
The work program shall be updated based on the progress of the
work including any changes
Clause 27.3
 The contractor is responsible for updating the work program
within the time stated in SCC 18

19. …Cont’d
Clause 27.4
 The Engineer’s approval of the Program shall not alter the Contractor’s
obligations,
The Contractor may revise the Program and submit it to the Engineer
again at any time.
A revised Program shall show the effect of Variations and Compensation
Events.
Clause 28, Extension of the intended completion date
Clause 28.1
The Engineer shall extend the Intended Completion Date if a
Compensation Event occurs or a Variation are issued
19

20. …Cont’d
Clause 28.2
The Engineer shall decide whether and by how much to extend
the Intended Completion Date within 21 days after recipt of the
time extention claim.
If the Contractor has failed to give early warning of a delay or
has failed to cooperate in dealing with a delay, the delay by this
failure shall not be considered in assessing the new Intended
Completion Date.
20

21. …Cont’d
Clause 29, (Acceleration)
Clause 29.1 and 29.2
When the Employer wants the Contractor to finish before the
Intended Completion Date, the Engineer will obtain priced proposals
for achieving the necessary acceleration from the Contractor
If the Employer accepts these proposals,
1. the Intended Completion Date will be adjusted accordingly and
confirmed by both the Employer and the Contractor.
2. The new proposal will be incorporated in the Contract Price
and it will be treated as a Variation.
21

22. …Cont’d
Clause 30, (Delays ordered by the Engineer)
Clause 30.1
The Engineer may instruct the Contractor to delay the start or progress
of any activity within the Works.
Clause 31, ( Management Meetings)
Clause 31.1
Either the Engineer or the Contractor may require the other to attend a
Management meeting,
Clause 31.2
The Engineer shall record the business of management meetings and provide
copies of the record to those attending the meeting and to the Employer
22

23. …Cont’d
Clause 32, (Early Warning)
Clause 32.1
The Contractor shall warn the Engineer at the earliest opportunity of
specific likely future events or circumstances that may adversely affect the
quality of the work, increase the Contract Price or delay the execution of
the Works.
The Engineer may require the Contractor to provide an estimate of the
expected effect of the future event or circumstance on the Contract Price
and Completion Date
Clause 32.2
The Contractor shall cooperate with the Engineer in making and
considering proposals for how the effect of such an event or circumstance
can be
23

24. Performance reports
Performance reports provide information on schedule performance
such as which planned dates have been met and which have not. It
may also alert the project team to issues which may cause problems
in the future.
Performance reporting involves collecting and disseminating
performance information in order to provide stakeholders with
information about how resources are being used to achieve project
objectives.
24

25. Change requests
Change requisites may occur in many forms-oral or
written, direct or indirect, externally or internally initiated,
and legally mandated or optional. Changes may require
extending the schedule or may allow accelerating it.
26

26. Record keeping
• Is the activity of organizing and storing all the documents, files,
invoices, etc. relating to a company's or organization's activities
(Cambridge Business English Dictionary).
• is the maintenance/preservation of a history of one's activities, as
financial dealings, by entering data in ledgers or journals, putting
documents in files, etc(Dictionary.com Unabridged).
Keeping site records is a daily practice on all the civil Engineering
projects and these records are maintained for different reasons.
Obviously, the extent of record keeping required for a particular
construction job will depend on the type of contract.
27

27. However, some record keeping will be required in any case because it is:
1. Required by law,
2. Required by the terms of the contract,
3. Needed to control the on-going work,
4. Needed as data for estimating future work, and
5. Needed for preserving the contractor's rights under the
contract
• Goal of maintaining site records in construction:
• To provide the right information to the right person at the right
time at the lowest possible cost.
28

28. The purpose of Record keeping in Construction:
To control the construction process by monitoring the
physical progress of the project and identifying
unsatisfactory progress;
To assure quality, by proving the works are carried out
according to the contract specification;
To control the finance of the project by monitoring the
financial situation of the project;
For preparing and assessing construction claims;
In order to establish the facts as to what actually happened
on the project; 29

29. •A ‘record’ can be defined as information generated in the
course of an organisation’s official transactions and which is
documented to act as a source of reference and a tool by
which an organisation is governed.
•The records themselves form a part of or provide evidence of
such transactions.
•As evidence, they are subsequently maintained by or on
behalf of those responsible for the transactions
 Construction Site Records:
30

30. Generally, Construction site records are used:
• For reference purposes during and after the construction period;
For providing a vital and often the only tool in the business of monitoring, controlling
and predicting the quality and progress of the works
Construction site record is therefore become imperative to maintain accurate written site
records, which include;
Work progress
Material quality for quality control
Weather data
Working hours
Any incidents
Material on sites
Labor and equipment deployed
Instructions issued (co-signed by all)
31

31. The following items should also be a part of the construction administration
record keeping
Field observations reports: follow-ups on all unresolved items
Shop drawings, samples, product data, checklist of all required
submissions
Submittals: checklist of all required submittals correspondence
Payment requests, schedules of contract sum and time, change orders
Change orders and construction change directives
Drawings and revisions
Specifications and revisions
Status of requests for information's and requests for quotations
Memos on delay caused by weather, strikes, unavailability of materials,
32

32. Construction site Diary
• The Construction Project Diary is a recorded collection of events, data,
occurrences, instructions, situations and work performed each day during a
construction project.
• Recorded information must be clear, detailed, accurate, complete and objective.
• Anyone reading the Project Diary should be able to comprehend the project status
and determine work performed.
• The site diary is completed by site engineers, site supervisor/ inspector, etc to
record all activities on site.
• The site diaries are often only referred to when there is a query/doubt as to what
actually took place on site.
• Site diaries can be used as a contemporaneous record of events and is a written
description of what happened at the time.
33

33. • Site diaries need to be kept for use post project for claims/disputes, or mid
project to verify health and safety audits/inspections, quality inspections and
progress reports.
• A Site Diary is admissible/acceptable/ in court as documentary evidence
• Construction Site Diaries in a given Construction project may be prepared:
1. By the Construction site Supervisor/ Inspector: Construction site
Supervisor 's/ Inspector diary
2. By Surveyors involved in construction project: Surveyor's diary
3. By the Project manager of the Construction Project: Project manager's
diary
4. By other professionals involved in the project ( if any and authorized to
prepare diary) 34

34. Advantages of Construction site diaries
The following are the reasons for keeping Construction site diaries:
• To document work progress, site conditions, labor and equipment
usage, and the contractor’s ability (or inability) to perform his/her work,
and
• Can provide valuable information necessary to accurately reconstruct
the events of the project in preparation of a claim.
• Maintain relationships with clients, contractors, and other stake holders;
• To record the amount and the type of labour on the site necessary to
achieve the required progress;
• Reduce financial risk
35

35. "Daily diaries are the key to claims avoidance and mitigating damages".
Contents of Construction Site diary
Generally, what is included in Construction site diary (i.e. the Contents of
Construction site diary) may vary depending on:
The nature and the Complexity of the project, work, service provided;
The scope of the Responsibility of the Professional preparing it:
The daily activities carried out;
The nature and magnitude of problems encountered;
Contractors Resources used and available at site
Weather condition
Delays, difficulties, accidents, utility damages, and other unusual conditions.
Other factors( if any)
36

36. Classification of Progress Report
Progress Report for a given Construction Project may be prepared:
• Weekly Progress Reports
• Monthly Progress Reports;
• Three months Progress report ;
• Six months Progress report;
• Annual progress report
 Who prepare Progress Report?
• Project manager; . Construction site supervisor;
• Consultant; . Site Engineer;
• Employer of the project to higher Government executive bodies in case of public
projects;
• Other professionals (if any and authorized to prepare)
37

37.  Information included in Construction project progress report
• Generally, what is included in Construction project progress report may
vary depending on:
The nature and complexity of project and of the things to be procured;
The scope of responsibility of the professional preparing the report;
The Type of progress report to be prepared( weekly, monthly, etc);
The Tools and Techniques used for progress monitoring;
Project progress measurement criteria;
Difficulties encounter during reporting time
other (if any);
38

38. Reports
Date
Time, duration
Weather conditions
Persons present
Percentage of work completed by trade
Work progress compared to schedule
Work now being accomplished, work scheduled before next visit
Questions raised by the contractor or owner
Determinations made by the engineer
Any questions or actions which remain pending for appropriate later attention.
39

39. 2. Quality control and Monitoring (QCM) in
Construction
• Quality control is a process employed to ensure a certain level of
quality in a product or service.
The basic goal of quality control is to ensure that the services provided
are …
1.Run into(meet) specific requirements
2.Dependable (reliable),
3.Satisfactory , and
4.Fiscally(economically) sound. 40

40. 2. Quality Control in Construction Involves
41

41. A. Human Resource Quality Control
 Includes the overall quality of organization
 Individual's knowledge, ability,
 Physical condition, behaviour & professional ethics
B. Construction Material Quality Control
Main contents are
I. Material Procurement
II. Material testing
III. Storage and Usage
42

42. Controlling whether the contractor purchase the materials based on
 the consideration of engineering characteristics,
construction contracts, construction requirements, performance and price of
materials.
Arranging the procurement
II. Material testing
• Through a series of detection methods--- the material data obtained is
compared with quality standards = to judge the reliability
III. Storage and Usage
-- Avoiding quality problems caused by material deterioration or misuse
--Making reasonable arrangement to avoid overstocking
I . Material Procurement
43

43. C. Construction Machinery & Equipment Quality Control
• Is required to make the type & performance parameters of construction
equipment which match the conditions, technology& other factors.
• Matching the mechanical equipment selected with the adapting
operation workers.
D. Construction Methods Quality Control
E. Environment Quality Control EQC
44

44. I) Role of the Agency in Quality Management During CoT
• Is quality management & assurance. So it performs
Scheduled audits & periodic oversight reviews.
to ensure contractors comply with their quality plans and overall Agency
QA policies.
II) Role of the Contractor in Quality Management During CoT
• The contractor controls the quality of deliverables by monitoring and
verifying either they meet the quality criteria specified in the design
documents or not.
• This quality control activities include construction site activity,
installation, inspection, test & documentation
45

45. Action on Non-Conforming Work (NCW)
• Conformity means the project meets company specifications, customer, legal,
regulatory, and other defined requirements.
• The Quality Control System Manager will perform sufficient control phases
and tests of all work, including that of subcontractors to ensure conformance.
The contractor is responsible for determining the cause of (NCWs) and taking
appropriate correctives BUT IF QUALITY PROBLEM CONTINUES…….
the CM should raise the corrective action request to the contractor’s senior
management
Further actions the CM can take include recommending to the Agency non-
payment for NCWs
 the Agency issue a stop work order until the contractor implements proper
disposition of the quality problem
46

46. Quality Control
Clause 33: Identifying Defects
The Engineer shall check the Contractor’s work and notify the
Contractor of any Defects that are found. Such checking shall not
affect the Contractor’s responsibilities
Clause 34: Tests
If the Engineer instructs the Contractor to carry out a test not
specified in the Specification to check whether any work has a
Defect and the test shows that it does, the Contractor shall pay for
the test and any samples. If there is no Defect, the test shall be a
Compensation Event.
47

47. …Continued
Clause 35:Correction of Defects
The Engineer shall give notice to the Contractor of any Defects before the end of
the Defects Liability Period, which begins at Completion, and is defined in the
Special Conditions of Contract
Every time notice of a Defect is given, the Contractor shall correct the notified
Defect within the length of time specified by the Engineer’s notice.
The Defects Liability Period shall be extended for as long as Defects remain to be
corrected.
Clause 36: Un corrected defects
If the Contractor has not corrected a Defect within the time specified in the
Engineer’s notice, the Engineer will assess the cost of having the Defect corrected,
and the Contractor will pay this amount. 48

48. Quality control
EBCS2-1995, 9.4 measures to be taken in case of non-compliance
If the quality of the structure is found to be in doubt after an inspection
or from the test results, then a special examination shall be made to
verify the soundness of the information received and to asses the actual
strength of the structure constructed with possible recourse to more
accurate methods of calculations.
Sequence of measures
The following sequential measures shall be taken where the results of
compliance control tests or inspection are unsatisfactory:
a) The position of concrete which does not fulfill the compliance
criterion shall be identified
b) The structural safety shall be checked by appropriate calculations on
the basis of the actual tests which did not comply. If safety is
assured, the concrete can be accepted.
49

49. …Continued
a) the structural safety or durability are not assured, then the strength of the concrete shall
be examined by taking drilled cores or by non-destructive methods. The results of the
tests shall be assessed on the basis of the prescribed acceptance criterion, taking into
account any differences in age.
d) If this new information's shows that structural safety is assured, the concrete may be
accepted after it has been decided whether repairs are necessary to ensure durability
e) If the results of check tests by non-destructive methods show that the quality of
concrete is inadequate or show other defects, the engineer may require a loading test to
be made which shall then carried out in accordance with procedure set in 9.4.4
f) If the structural safety and durability are not assured, then the possibility of
strengthening the structure must be investigated. If strengthening is not feasible, then
the concrete shall be rejected, and the structure or member demolished or given a
reduced structural grading by limiting its service rating, as appropriate.
50

50. 3. Cost Control and Monitoring
51

51. Introduction
In countries like Ethiopia most construction projects
didn’t completed with the estimated project cost because
of the following reasons:
Variations due to request from either parties,
Delay,
Under estimated quantities,
Incompleteness of designs,
The method of cost controlling in PPA has been defined
from clause 37 up to 54 of General conditions of contract.
52

52. Cost Control
 Clause 37 : Bill of Quantities or activity schedule
 Types of Contract
 Admeasurements contract » BOQ
 Lump sum » Activity schedule....
 The quantities set out in the Bill of Quantities are the estimated quantities for the
Works, and they are not to be taken as the actual and correct quantities of the Works
to be executed by the Contractor in fulfilment of his obligations under the Contract.
 Clause 38: Change in bill of quantities
 Option 1: Changes in the Bill of Quantities for Admeasurements Contracts
 If final qty >qty in BOQ by 25% provided that the change exceeds 5% of the
contract price, the engineer shall adjust the unit rate.
 The engineer shall not adjust the unit rate if the change exceeds 15% of the
contract price.
 The contractor shall submit the cost breakdown up on request
53

53. …Continued
Option 2: Changes in the Activity Schedule for Lump Sum Contracts
 Prices in the Activity Schedule shall not be altered.
 Clause 39: Variations
 All Variations shall be included in updated program produced by the Contractor
 Clause 40: Payment for Variations
 For both Admeasurement and Lump Sum Contracts, the Contractor shall provide
the Engineer with a quotation/expression for carrying out the Variation when
requested to do so by the Engineer.
 For Admeasurement Contracts only, if the work in the Variation corresponds with
an item description in the Bill of Quantities and if, in the opinion of the Engineer,
the quantity of work above the limit stated in Sub-Clause 38.1 or the timing of its
execution do not cause the cost per unit of quantity to change, the rate in the Bill
of Quantities shall be used to calculate the value of the Variation
54

54. …Continued
 If the cost per unit of quantity changes, or if the nature or timing of the work in the
Variation does not correspond with items in the Bill of Quantities, the quotation by
the Contractor shall be in the form of new rates for the relevant items of work.
 For both Admeasurement and Lump Sum Contracts, if the Contractor’s quotation
is unreasonable, the Engineer may order the Variation and make a change to the
Contract Price, which shall be based on the Engineer’s own forecast of the effects
of the Variation on the Contractor’s costs.
 For both Admeasurement and Lump Sum Contracts, the Contractor shall not be
entitled to additional payment for costs that could have been avoided by giving
early warning.
55

55. …Continued
Clause 41: Cash flow forecast
When the Program is updated, the Contractor shall provide the
Engineer with an updated cash flow forecast.
The cash flow forecast shall include different currencies, as defined in
the Contract, converted as necessary using the Contract exchange rates.
Clause 42: Payment Certificates
The Contractor shall submit to the Engineer monthly statements of the
estimated value of the work executed less the cumulative amount
certified previously
The Engineer shall check the Contractor’s monthly statement and
certify the amount to be paid to the Contractor.
The value of work executed shall be determined by the Engineer.56

56. …Continued
The value of work executed shall comprise the value of:
a) The quantities of the items in the Bill of Quantities completed in the case of
Admeasurement Contracts; or
b) Completed activities in the Activity Schedule in the case of Lump Sum
Contracts.
 The value of work executed shall include the valuation of Variations and
Compensation Events.
 The Engineer may exclude any item certified in a previous certificate or reduce
the proportion of any item previously certified in any certificate in the light of
later information.
57

57. …Continued
Clause 43: Payments
 Payments shall be adjusted for deductions for advance payments and
retention
 If an amount certified is increased in a later certificate or as a result of an
award by the Adjudicator or an Arbitrator, the Contractor shall be paid
interest upon the delayed payment as set out in this clause
 Unless otherwise stated, all payments and deductions will be paid or
charged in the proportions of currencies comprising the Contract Price.
 Items of the Works for which no rate or price has been entered in will not
be paid for by the Employer and shall be deemed covered by other rates
and prices in the Contract
58

58. …Continued
• Clause 44: Compensation event
• Clause 45: Tax
• Unless otherwise specified in the SCC, the Engineer shall not adjust the Contract
Price if taxes, duties, and other levies are changed that subsequently affect the
Contract Price.
• Clause 46: Currencies
• Where payments are made in currencies other than Ethiopian Birr, the exchange
rates used for calculating the amounts to be paid shall be the exchange rates
stated in the Contractor’s Bid.
Clause 47: Price Adjustements
59

59. Clause 47: Price Adjustments
Prices shall be adjusted for fluctuations in the cost of inputs only if
provided for in the Special Conditions of Contract.
.
where
. pn is a Price adustamente factor
A is a constante
b, c, d, etc., are weightings or coeficientes
Ln, Mn, En, etc., are the current cost índices
Lo, Mo, Eo, etc., are the base cost índices
And ; the sum of A, b, c, d, etc., shall be one;
60
.
etc
Eo
En
d
Mo
Mn
c
Lo
Ln
b
A
pn 





60. Clause 48 Retention
The Employer shall retain from each payment due to the
Contractor the proportion stated in the Special Conditions of
Contract until Completion of the whole of the Works.
On completion of the whole of the Works, half the total amount
retained shall be repaid to the Contractor and half when the Defects
Liability Period has passed and the Engineer has certified that all
Defects notified by the Engineer to the Contractor before the end of
this period have been corrected.
61

61. Clause 49: Liquidated damage
49.1 The Contractor shall pay liquidated damages to the Employer at the rate per
day stated in the Special Conditions of Contract for each day that the
Completion Date is later than the Intended Completion Date. The total amount
of liquidated damages shall not exceed the amount defined in the Special
Conditions of Contract. The Employer may deduct liquidated damages from
payments due to the Contractor.
49.2 If the Intended Completion Date is extended after liquidated damages have
been paid, the Engineer shall correct any overpayment of liquidated damages
by the Contractor by adjusting the next payment certificate. The Contractor
shall be paid interest on the overpayment, calculated from the date of payment
to the date of repayment, at the rates specified in Sub-Clause 43.1.
62

62. 50.Bonus:
The Contractor shall be paid a Bonus calculated at the rate per calendar day stated
in the Special Conditions of Contract for each day (less any days for which the
Contractor is paid for acceleration) that the Completion is earlier than the Intended
Completion Date. The Engineer shall certify that the Works are complete
51. Advance Payment
• The Employer shall make advance payment to the Contractor of the amounts
stated in the Special Conditions of Contract by the date stated in the Special
Conditions of Contract, against provision by the Contractor of an Unconditional
Bank Guarantee in a form and by a bank aceptable to the Employer in amounts
and currencies equal to the advance payment.
• The Guarantee shall remain effective until the advance payment has been repaid,
but the amount of the Guarantee shall be progressively reduced by the amounts
repaid by the Contractor. Interest will not be charged on the advance payment
63

63. 52.Securities
The Contract Security shall be provided to the Employer no later than 15
days after receipt of the Letter of Acceptance and shall be issued in the
form of a Bank Guarantee, or for Ethiopian Contractors only in the form of
a Performance Bond.
The Contract Security shall be valid until a date 28 days from the date of
issue of the Certificate of Completion in the case of a Bank Guarantee and
until one year from the date of issue of the Certificate of Completion in the
case of a Performance Bond.
64

64. 53. Day works
• If applicable, the Day works rates in the Contractor’s Bid shall be
used for small additional amounts of work only when the Engineer
has given written instructions in advance for additional work to be
paid for in that way.
• All work to be paid for as Day works shall be recorded by the
Contractor on forms approved by the Engineer. Each completed
form shall be verified and signed by the Engineer within two days
of the work being done.
• The Contractor shall be paid for Day works subject to obtaining
signed Day works forms.
65

65. 54.Cost of Repairs :
Loss or damage to the Works or Materials to be incorporated in
the Works between the Start Date and the end of the Defects
Correction periods shall be remedied by the Contractor at the
Contractor’s cost if the loss or damage arises from the Contractor’s
acts or omissions.
Sample of payment certificate and how to prepare ……
66

66. 67

67. 4. Earned Value Management
4.1 General: Earned Value Management
 Earned Value Management (EVM) is used to measure project
performance in terms of time and cost.
 Earned value improves on the "normally used" spend plan
concept (budget versus actual incurred cost) by requiring the
work in process to be quantified.
 The planned value, earned value, and actual cost data provides
an objective and quantifiable measurement of performance,
enabling trend analysis and evaluation of any cost estimate at
completion within multiple levels of the project. 68

68. 4. Earned Value Management
4.2 Earned Value Management Terms
 Planned Value (PV):- formerly called the budgeted cost of work
scheduled (BCWS), also called the budget, is that portion of the
approved total cost estimate planned to be spent on an activity
during a given period.
 Actual Cost (AC):- formerly called actual cost of work
performed (ACWP), is the total of direct and indirect costs
incurred in accomplishing work on an activity during a given
period.
 Earned Value (EV):- formerly called the budgeted cost of work
performed (BCWP), is an estimate of the value of the physical
work actually completed.
 Schedule Variance (SV) = EV-PV
 Cost Variance (CV) = EV-AC
69

69. 4. Earned Value Management
4.3 Interpretation of Earned Value Numbers
 Negative numbers for cost and schedule variance indicate
problems in those areas.
 Problems mean the project is costing more than planned (over
budget) or taking longer than planned (behind schedule).
4.4 Schedule Variance
 As work is performed, it is "earned" on the same basis as it was
planned, in dollars or other quantifiable units such as labor hours.
Comparing earned value with the planned value measures the
dollar value of work accomplished versus the dollar value of
work planned.
 Any difference is called a schedule variance.
Schedule Variance (SV) = Earned Value-Planned Cost
70

70. 4. Earned Value Management
4.5 Cost Variance
 The value earned for the work performed compared with
the actual cost incurred for the work performed (taken
directly from the contractor's accounting systems),
provides an objective measure of cost efficiency.
 Any difference is called a cost variance.
Cost Variance (CV) = Earned Value-Actual Cost
 A negative variance means more money was spent for
the work accomplished than was planned.
 Conversely, a positive variance means less money was
spent for the work accomplished than was planned to be
spent.
71

71. Contd…
• Cost Performance Index (CPI) – The ratio of cost of work performed
(BCWP) to actual cost (ACWP). CPI of 1.0 implies that the actual cost
matches to the estimated cost. CPI greater than 1.0 indicates work is
accomplished for less cost than what was planned or budgeted. CPI less
than 1.0 indicates the project is facing cost overrun.
• Schedule Performance Index (SPI) – The ratio of work accomplished
(BCWP) versus work planned (BCWS), for a specific time period. SPI
indicates the rate at which the project is progressing.
72

72. Contd…
•Estimate At Completion (EAC) – It is a forecast of most
likely total project costs based on project performance and
risk quantification. At the start of the project BAC and
EAC will be equal. EAC will vary from BAC only when
actual costs (ACWP) vary from the planned costs
(BCWP).
73

73. Contd…
•Estimate To Complete (ETC) – The difference between
Estimate At Completion (EAC) and the Actual Cost (AC).
This is the estimated additional cost to complete the project
from any given time.
•Variance At Completion (VAC) – The difference between
Budget At Completion and Estimate At Completion (EAC).
This is the dollar value by which the project will be over or
under budget.
74

74. 75

75. 76

76. The Comparison between planned and earned values provides
work accomplishment or project performance in terms of cost
and time variances
77
Schedule Performance
Index
Cost Performance Index R
A
T
I
O
BCWS BCWP ACWP
Schedule
Variance
Cost Variance
V
A
R
I
A
N
C
E

77. The expression used for computations based on EV Analysis can
also be shown clearly using three S-Curves
Planned comp.
date
Status date Actual
comp.date
Time
CV
SV
ETC
EAC
BAC
VAC
Forecast time
overrun
Over budget
cash flow
ACWP=AV
BCWS=PV
BCWP=EV
SV=EV-PV
CV=EV-AV
CPI=EV/AV
SPI=EV/PV
78

78. Thank You!!!
ተፈፀመ
79

79. Quiz sec-IV
The excavation of for one building scheduled for 10 days on
100birr. Currently the excavation work on 3rd day the work
completed 20% in 30 birr. Then find
a) CV
b) SV
c) SPI
d) CPI
Of excavation work and write status of work?
80

80. Quiz
•You are working as an intern and have 10 m3 mixing
of concrete. It is estimated that it will take you 5
hours per m3 and you are scheduled to work 5 hours
a day. You are paid birr10 per hour. After 6 work
days you have spent 15 hours and completed 5 m3
concrete.
81

81. Quiz- 3 sec- II
1. You have a project to be completed in 12 months. The
budget of the project is 100,000 birr. Six months have
passed and 60,000 birr has been spent. On closer review,
you find that only 40% of the work has been completed so
far.
•Then find
A. EV
B. PV
C. CV
D. SV
Then describe the status of project? 82

82. Example
Given a project with the following characteristics, answer the following
questions:
• You are the project manager of a project to build fancy birdhouses.
• You are to build two birdhouses a month for 12 months.
• Each birdhouse is planned to cost $100.
• Your project is scheduled to last for 12 months.
• It is the beginning of month 10.
• You have built 20 birdhouses and your CPI is .9091.
Then find
a. EV, PV,AC,CV, SV and SPI
b. States of project
83