Policies of Management of Construction Projects

Policies of Management

• Factors contractors consider in deciding whether or not to bid a particular project include:
  • Location of the work
  • Factors Contractors Consider
    • Identity of the owner
    • Availability of key company personnel
    • Experience in the type of work solicited
  • Factors Contractors Consider
    • Whether or not there is financing for the project
    • Size of the project.

Bid Preparation

Bid preparation is expensive! In preparing a bid, contractors must consider the costs of:

• Equipment
• Labor
• Materials
• Subcontractors

Consider the costs of:

• Job and company overhead, contingency, and profit
• Should also consider the number of competitor bidders and the bidding history of those competitors on similar projects

Award Phase

• Owner provides:
  • Builder’s Risk insurance
• Successful bidder must provide:
  • Payment and performance bonds
  • Workers compensation insurance
  • Liability insurance
  • List of subcontractors
  • Detailed project schedule

Notice to Proceed

Contractor cannot begin the work until the Notice to Proceed is received – so Use the time between bid opening and contract award for detailed pre-project planning.

Pre-project planning

Planning how the work will proceed and in what sequence

• Construction procedures
• Type of equipment to be used
• Job access
• Location of the field office and storage areas
• Final selection of subcontractors and suppliers

Pre-project planning

• Cash flow analysis should be completed to determine if the company needs to borrow money
• Detailed project schedule is prepared
• Work break down (WBS) and pay schedule are planned

Construction Phase

Size of the contractor’s on-site project management organization is a function of the size and complexity of the project.