Lecture 11

Question 1

To choose what methid DBB or DB or CM

Answer 1

we look at the success parameters:
How long
How much it will cost
What will be the quality

Question 2

DBB

Answer 2

Advantage: Sequential method we will have full design
We can have then a not very high lump sum (BOQ is already present)
U can report best deal for the price due to competition
Disadvantage
Price of lump sum may be high not because of the quantity variations but because due to the uncertainty in price and economic situtation like the one present in Lebanon like currency fluctuation
Also inflation of raw materials
ALso the size of the bid play a role, high bid high risk.

Question 3

How can I mitigate the risk

Answer 3

I can increase the number of people competing
Share the risks with the contractor
I will ask him to gice the bid on current exchange rate and i will tell him if the exchange rate goes above a certain number i will cover for the fluctuation

Question 4

in the CM method

Answer 4

advantages:
I am directly going to the trait contractor, i have the cheapest, with no overhead cost.
If u have a small project and u have a little experience u can do it yourself
Cost will be better
CM will supervise
Disadvanataage
…the safety of the site becomes more compllicated and diiferent to deal with due to interaction
…Quality
IN DBB it is clear when to check and it is easy to check for the liability of the project for the handover.

In CM method it is complicated u dont have one entity , so if u have a problem and that problem can dance around many entities, also some entities may finish their work before the handover, thier one year liability period may have ended.Also if a problem from one entity damages the other entity , the second cant be held responsible. like false ceiling fell due to AC leakage (Because they are not independent)
Difficult to deal with the problem
If i require them to increase the period of liability they will increase the price
We can increase the gaurantee in order to deal with that
Bottom line
When u divide the project through CM it becomes cheaper however more complex to deal with the problems. Because U have multiple entities

Question 5

No more single defect liability period instead we have staggered multiple liability periods

Answer 5

true

Question 6

When with mainreasons that we go with phase approach (CM approach) is time, due to overlapping time can be decreased

Answer 6

true

Question 7

However from risk prospective it is totally opposite, if you are late who will pay the penalty (liquidated damages)

Answer 7

true
easier to apply Liquidated damages on GC instead of phase approach.
It is complicated to know why u got late whicg entity is responsible; you cant allocate the blame
U need in depth analysis to know

Question 8

Ways to deal with risks

Answer 8

risk elemination :
If price change by 10% we will cover for that
risk accpetance:
We account additional money to forecast the problem