Tactics to Reconstruct the Completed Buildings due to Shifting of Project Layout by the Government Agency - Case Study Example

School: Topic: TACTICS TO RECONSTRUCT THE COMPLETED BUILDINGS DUE TO SHIFTING OF PROJECT LAYOUT BY THE GOVERNMENT AGENCY Lecturer: Date of Submission: 1.0 Introduction The project at hand was a multiple project made up of 5 individual and separate buildings found at different locations, and all of which were surrounded by external road works. The two major works referred to, which are the 5 individual buildings and external road were owned by a private person and government respectively. On the part of the private owner, he had successfully awarded the work to be done to a contractor, who had also executed the site setting and started construction for all 5 buildings. The dilemma in the case arose as the government through the Government Road Authority (GRA) issued a new layout of the external road, which came to obstruct the continuation of the building projects. As the 5 individual buildings were privately owned and the external road works was under the auspices of the government, it means that the real situation at hand had to do with an amicable private-public sector engagement. A major climax of the private-public sector engagement came about when the client who is on the government side issued notice to the contractor to re-establish the settings of the all the 5 buildings to ensure that they do not conflict with the external road. It is important to note that construction had also started for all the buildings. Once the notice was received by the contractor to re-establish the settings of the road, he engaged with the owner and informed him about the demolition, a situation that merited claim for additional time and cost for the project. As a person tasked with the responsibility of Senior Contracts Administrator, I had a role of reporting to contractors Project Manager. This means that my role was very crucial in ensuring a successful engagements and negotiations between the owner and the contractor. The private-public sector engagement widened the stakeholder base of the project, giving rise to both external and internal stakeholders. Externally, representations from the GRA, beneficiaries of the external road, financiers and third party quality control administrators on the project were all stakeholders. Internally, the project owner, people living in the community, contractor, all employees under the contractor, including project manager, and other internal auditors and inspectors were part of the project’s stakeholders. Given the nature of the stakeholders, the stakeholder theory which sees the true ownership of a project as belonging to all people who may be directly or indirectly affected by the project applied. As part of the principles of construction and project management, contractors are expected to deliver their projects within specific timeframes and use a specific budget. The change in the settings of all the building that came about due to the new layout of road however merited additional cost and time. With the problem that came about, the best expected outcome was for there to be an amicable settlement between the owner and the contractor as to how the project could go on with additional time and additional cost. The timeline to get such settlement done was only a few weeks, about 3 weeks so that the project would not have to delay any further. As the Senior Contracts Administrator, I was tasked with all forms of modifications and changes to the contracts signed between the owner and the contractor, meaning that I was expected to use my technical competencies and expertise to facilitate every process. The approach used and the resulting achievements from it has been presented in remaining sections of the case study. 2.0 My Approach 2.1 Key Issue 2.11 Identification of key issue The case at hand gave rise to a private-public partnership dilemma. The dilemma has come about because government has introduced a new layout for the external road, requiring the demolition and rebuilding of 5 individual buildings that have already commenced on the site in question. The public sector which is led by the government’s agency of GRA however has an upper hand over the private owner. As a result of this, the key issue now that the contractor, in whose firm I work for is faced with is claiming additional time and additional cost from the owner. 2.12 Overview of key issue With the nature of key issue given, it can be stated that the need to secure additional time and cost is only mandatory for the contractor. This means that this request could be either accepted or denied by the owner of the project, depending on the approach taken by the contractor towards the issue. This mandate has befallen the contractor as the firm has already completed contractual and commercial negotiations and arrangements with the owner. Certainly in project management, lost time can hardly be found unless additional sacrifices are made to double working efforts. In the present circumstance, the lost time was with construction that had been started. The need for additional time was an issue and challenging because if the contractor forced his way to finishing per original schedule, quality of the work could have been compromised. In terms of cost also, losses in the cost had occurred with the amount of money spent in the construction that needed to be demolished. To make recovery in cost, cost-cutting is the most preferred solution but this was not going to be applicable in this case but the need to demand for additional cost. The reason for this assertion is that cutting down cost could have affected the procurement of quality materials and the use of competent suppliers as a means of beating cost. Such a practice could also have affected the overall outcome of the projects quality delivery negatively. Based on the need to get additional time and cost which the owner was not obliged to, getting amicable settlement was therefore the only way out. 2.2 Cause As far as the cause is concerned, it can be said that this is issue had come about due to due to poor feasibility study and projection on the part of the agents responsible for surveying the area and selling out the site to the owner. The reason for this claim is that most roads demarcated for governmental projects including external roads are clearly indicated in the site plan when paying for a piece of land for a project such as the construction that was taking place. However, most owners overlook government demarcations, thinking the government projects will never come off or not come off any time soon. This is another possible cause for the current issue. As there was disregard for future construction activities by the government, the key issue was caused as GRA issued a new layout of road. The issuance of the new layout affected the project by obstructing its progress. This issuance is therefore regarded as the cause of the key issue, which is now the need for additional time and cost. This cause came with its own accompanying problems including the need to demolish and rebuild the 5 individual buildings which had already started and were at various stages of completion. Demolition and rebuilding were necessitated because the road was under the auspice of the GRA, which is a government agency, meaning the owner and contractor did not have any upper hand. 2.3 Effect The issuance of the new layout for the road which led to the key issue of claiming additional time and cost can be said to be challenging because the demolition which warranted the claim were things the contractor and owner had no option to than complying. Meanwhile, as part of the principles of project management, the owner’s interest in completing the 5 buildings within a specified time frame was supposed to be honoured and adhered to without fail by my firm. At the same time, it was important that the contractor guaranteed value for money by ensuring that any budgets and expenses that were made were duly adhered to. The most direct and immediate effects of the key issue can be said to be justification of the contractor’s credibility to follow provisions of the competitive tendering process which were agreed to ahead of the project. Certainly, unlike the bid that was put into the project, there will be changes in completion time of project and increase in cost of project. Once the amicable settlement for additional time is agreed, the resulting outcome is that the owner of the project will not have the projects finished per initial plans. Meanwhile, the owner might have his own plans for commercial use of the projects, which means that delaying the project may delay or affect the flow of revenues in the nearest future. What is more, the owner would have to raise extra money to cover the additional cost that will be agreed upon should the amicable settlement for additional cost go through. Morgen (2003) however observed that for any project, the higher his cost of construction, the lower its resulting value. 2.4 Tackling the key issue One of the provisions of critical thinking and problem solving approach provides that when attempting to solve an issue, it is important to consider several options, out of which the best solution will be chosen. With this said, three options were laid out to be considered in solving the key issue of claiming additional time and cost. These options have been summed below. i. Set up an inter-stakeholder steering team to negotiate for time and cost: This team was going to be made up of representatives from the GRA, surveyors, representatives from the construction company, lawyers of the owner, and the owner. The notion behind this option was to push full cost to the owner. This option was taken to cover a situation where legal provisions would not bind the government to make any settlement in terms of compensation, or rebuilding the project. Again, this option was selected in the event of having the need to fast track the project whilst avoiding long litigation processes. ii. Outsource a conflict avoidance and dispute resolution expert: This option was taken to ensure that there is a third party agent to take charge of negotiations on the part of the contractor and the construction company. The outsourced expert was also supposed to be responsible for getting compensation settlement from government. This decision was taken as a means of avoiding the transfer of additional cost in the demolition to the owner of the building. It could also help in ensuring that even if there was transfer of cost, only partial transfer of cost would take place. iii. Outsource a legal aid: To get claim for additional cost and additional time, this would have ensured that a legal process would have gone through to achieve the settlement. Part of the legal aid’s work was to get government contractors to undertake the rebuilding to the stage of the projects. This decision was also taken so that the full recovery of cost will be taken by government in ensuring that the projects were project back to the stage they were before the issuance of the new layout of the road. 2.42 Selected Solution Each of the three options for the core issues was subjected to critical thinking and brainstorming. This is to say that the merits and weaknesses of each option were brought under critical scrutiny to select the best outcome. After this was done, the selected solution was to set up an inter-stakeholder steering team that would confer with the owner and his advisers and come up with an amicable settlement for additional time and additional cost to be granted. The other two options were not selected because they were seen not be guarantee active participation as each of them would have involved an external agent rather than the contractor and the owner in a direct discourse that would make the understanding of issues more easily. As indicated earlier, the contractor was not in any position to impose this choice on the owner. As a reason, it was very important that most thorough and in-depth tactics and techniques that would bring about amicable settlement of the issue be used. In the light of this, the 7Cs of communication were selected to be used as the approach in working with the steering team. According to the 7Cs of communication, every communication must be carried out in a way that is clear, concise, concrete, correct, coherent, complete, and courteous. With this need in mind, the first step that was taken was to ensure that any engagements that would take place between contractor and owner took place in a formal environment where all communications were documented in a clear and concise manner. For example ahead of any meeting, there was an agenda sheet given to all parties to study critically so that they will each come to the meeting well prepared to the issues. Again, each meeting was characterised by the preparation of minutes, a copy of which was given to each participant to authenticate the fallout of the meeting before taking any actions based on the meetings. Even more, all meetings took place in a healthy atmosphere where each participant had the opportunity to contribute to discussions so as to make their views well given and factored in any actions that were to be taken. The implication of the selected solution was to push the full cost of demolition and rebuilding to the owner of the project. This conclusion was arrived at based on the reason that legal considerations revealed that the owner was not in a position to make any claims from government due to the fact that some major due diligence were lacking at the point of acquiring the site for the construction of the 5 individual buildings. Because of the absence of the due diligence, it was not possible to make any substantiated claims backed by legal provisions for the owner, meaning the two other options were not going to be feasible. After the conclusion was reached to push the full cost of demolition and rebuilding to the owner as part changes in the layout of the external road, there were some technical competences that needed to be ensured to guarantee that the demolition and rebuilding would be carried out successfully. As part of this, the principles of universal design and construction were adopted as part of the demolition and rebuilding that was to take place. As noted by The NC State University (2012), the principles of universal design and construction comprise the need for equitable use, flexibility in use, simple and intuitive use, perceptible information, tolerance for error, low physical effort, and size and space for approach and use. In the figure below, how each of the principles was used have been summarised. Adopted from NC State University (2012) 3.0 My Achievements 3.1 Eventual achievements After implementing the identified solution and promising the owner to use the universal design principles in the rebuilding, there were very specific achievements that were made. After applying the solution of principles of universal design to the demolition and rebuilding, the resulting achievement was that a very detailed plan that was to be used in the execution of the demolition and rebuilding was prepared. This plan was designed after a consensus was successfully reached to push all the cost unto the owner of the building. This was an achievement that was considered a highlighting part of the whole case. This is because if the plan had not come in place with the consensus between the contractor and the owner, as well as other stakeholders identified earlier, it was going to be extremely difficult to guarantee that the project will take place at all. It would be noted that the contractor had virtually no say as to whether or not the 5 individual buildings that had been started was going to be demolished. This is because of the upper hand that the government had over the owner. Instead of dragging up a long litigation, it was only necessary that a resolution will be reached with the owner to engage in the demolition and rebuilding. In terms of the key issue of claiming additional time and cost, the achievement made was that the owner eventually agreed to extend the completion time of the project. As it has been highlighted earlier, this was an achievement that ensured that the project will not be rushed unnecessarily to affect its quality of delivery. Securing the extension from the owner was therefore an important achievement that was going to affect the reputation of the contractor and the construction firm he was representing because he had the opportunity to carry out the work at a pace that was convenient for guaranteeing quality. In terms of cost, the owner agreed to expand the budget by allowing more expenditure and forgoing the cost that had already been incurred as a result of the demolition. The extension in cost was also another achievement that was highly needed given the fact that it was the only way the right forms of procurement with the best of standards could be made for the study. 3.2 How achievement was made To sum it all, it would be said that the achievements that were made came about due to the use of effective team work. The reason for saying this is that in tackling both the first and second issues, it was ensured that not everything will be left for the contractor and the construction company alone to do. Rather, they collaborated with all other stakeholders, easing up the pressure and workload that would have been carried by one person alone. What is more, the collaboration ensured that each person involved in the issues would take maximum responsibility for any portions of the issue that they were responsible for. This is something that came about due to the use of the inter-stakeholder steering team which adopted the objectives of a cross functional team. It would be noted that in using cross-functional team, people with different expertise and knowledge in a field of work are brought together to achieve a common goal. 3.3 Personal involvement The key issue involved claiming additional time and additional cost from the owner. It is important to note that with any of the two other options, the need to get additional time was going to be necessary. This is because even if the government had decided to take all the cost of construction, the work would have still delayed, requiring that the negotiations that were opened take place. Again, with the option that asked for a conflict resolution expert to get compensation, the need to get both additional cost and time were also going to be necessary. None of the option with the first two options was therefore going to solve the key issue entirely, calling for the need to have a separate set of option for that. It must be mentioned however that once the external experts were not eventually introduced, I had to take up most of the roles that would have taken. As a person tasked with the responsibility of Senior Contracts Administrator, much of the outcome of the work depended directly on me. This was because I was the one who was to report directly to the contractor’s project manager. Whilst doing this, I ensured that my involvement was done with the total application of my core technical skills and competences including commercial management, contract practice, contract administration, procurement and tendering, as well as financial reporting. Regarding the mandatory issues also, I applied my competences in areas such as conduct rules, ethics and professional practice, client care, communication and negotiation, as well as conflict avoidance and dispute resolution. A typical example of an instance when my advice was used to attain amicable settlement was when I had a one-on-one meeting with the owner to explain to him that based on my optional technical knowledge in design economics and planning, we had a lot to gain if we agreed to take full cost of demolition rather than litigating with government. It was the result of this that extension of time and cost was finally allowed. Conclusion Given the fact that the approach taken in solving the issue yielded positive results, it can be concluded that the performance displayed was a good one. First of all, the performance was highly involving and participatory, bringing all affected stakeholders together in a shared responsibility. By so doing, it was not possible that any of the stakeholders would feel that decisions were imposed on them. Rather, each of them saw themselves as part of the solution generating process, a reason for which they felt bounded by the eventual outcome. Secondly, the approach used made the whole process an active one rather than a passive one. What this means is that no person who was affected by the issues was made to sit on the fence and have things imposed on them. Rather, each person brought their expertise, helping to build a strong teamwork which promoted cross-functional work. Because performance was based on strong activity, it was possible to ensure efficiency as the goals of settling the issues were achieved on time. As part of the approach used and the outcomes gained, there were a number of lessons that I learnt as a person. First, I came to learn that for any major project such as this, conformity rather than individualism is the best means to guarantee results. The reason for saying this is that when we work together as a team, it is possible to share ideas and experiences, which eventually builds on each person’s knowledge. Second, I have come to learn more about my personal strengths and weaknesses when participating in a team. More importantly, I have come to learn that when given the opportunity, I can be a very good leader as I have my strength in leadership. This discovery was made when I received positive remarks from stakeholders involved in the issues as to how I went about the approach. In terms of weakness, I have come to learn that I need better organisation with my timing so that I can always be ahead of schedules that I make for myself and my team. In any future endeavours, there are some things that I would do differently and others I would like to introduce in order to make outcomes of my achievements more consolidating. One thing I will focus on is the introduction of a rigorous feedback system. I saw that when I received remarks from some stakeholders on my performance, it helped me to make better discovery of my personality and performance. These remarks however came in an unplanned manner. By implication, if I am able to design a systematic feedback system that would ensure that from time to time people involved in any team I am given responsibility of report to me, it would improve performance. Secondly, I will change my approach to time management. I happened to be committed to more than one responsibility at a time. Meanwhile in project management, Stellman and Greene (2005) warned that such practices could lead to haphazard turn of events and affecting outcomes negatively. I will therefore ensure that I have a well planned schedule which ensures that I take up one responsibility at a time and not combine personal responsibilities with professional responsibilities. Read More