Work of the Construction Professional Flashcards
Describe the allocation of responsibilities and risks among major parties in construction. (3)
- design team: architects, engineers, and other consultants
- construction team: general contractor, trade partners, suppliers
- owner team: owner, financers, user groups
What are the four major project delivery methods?
- design/bid/build
- design/build
- construction manager: fee-based
- construction manager at risk (CMAR)
Describe the design/bid/build delivery method. (5)
- owner hires separate design and construction teams
- traditional, well-established method
- provides high degree of confidence regarding project schedule and budget
- separate entities provide checks and balances
- difficult to integrate construction enterprise into design
Describe the design/build delivery method. (5)
- owner hires a single design and construction entity
- fosters coordination between architect/engineer and general contractor
- single point of accountability for owner
- fewer checks and balances
- use of this delivery system is growing rapidly
Describe the construction manager (fee-based) delivery method. (4)
- owner hires independent construction manager to oversee design and construction services provided by multiple entities
- contracts with the owner for a flat fee
- construction expertise is available to owner throughout project
- most commonly associated with large-scale, complex projects
Describe the construction manager at risk (CMAR) delivery method. (2)
- the construction manager acts more like a general contractor and takes greater responsibility (risk) for construction quality, schedule, and costs
- in CMAR, it is common for the construction manager to contract directly with trade partners and agree to deliver the project at a guaranteed maximum price
What are a couple other variations on project delivery methods?
- turnkey construction: single entity provides financing as well as design and construction services
- single-purpose entity: combines owner, design, and construction teams into one legal entity
What are the two major financing methods?
fixed-fee (lump sum) and cost-plus-a-fee
Describe the fixed-fee (lump sum) financing method. (2)
- owner pays an agreed, fixed amount for work to be performed
- general contractor assumes most finacial risk or potential reward
Describe the cost-plus-a-fee financing method. (3)
- owner pays contractor’s direct costs plus an added fee for overhead and profit
- contractor is protected from cost uncertainty
- owner assumes more cost risk/savings reward potential
Describe three types of risk allocation.
- incentive provisions: financially reward contractor for timely completion of cost savings
- liquidated damages: financially punish contractor for not finishing project on time
- bonds: protect against contractor default
What are the two major construction phasing methods?
- sequential construction
- phased (fast track) construction
Describe the sequential construction phasing method. (2)
- each major phase begins only after the preceding phase is complete
- design is complete before construction begins
Describe the phased (fast track) phasing method. (2)
- design and construction phases overlap
- goal is to reduce or compress total project duration and save time
What are some common delivery and phasing combinations? (2)
- traditionally, sequential construction is associated with design/bid/build construction
- phased (fast track) construction is most naturally suited to design/build and construction management project delivery, where construction expertise is available during the design phases of the project
