Project Controls Handbook Vol 2

Principles of Construction Controls Volume II (Sub)Contract Execution 1998 Edition

BECHTEL CONSTRUCTION OPERATIONS INCORPORATED

©1998 Bechtel Corporation 1998 Edition. All Rights Reserved. Contains confidential information proprietary to Bechtel and that may not be disclosed to a third party without Bechtel’s prior written permission. Printed in the United States of America.

Table of Contents

Principles of Construction Controls, Volume II, (Sub)Contract Execution TABLE OF CONTENTS

SECTION 1 Introduction

1-1

BECHTEL CONSTRUCTION OPERATIONS GUIDING PRINCIPLES

1-1

PURPOSES AND OBJECTIVES

1-1

DOCUMENT SCOPE

1-2

THE PROJECT CONTROL CYCLE

1-4

SECTION 2 Project Controls Planning

2-1

OVERALL CONTROL CYCLE AND PROJECT PLANNING

2-1

SCOPE

2-1

PROJECT SCHEDULING

2-1

PROJECT BUDGETS

2-2

BUDGET CONTROL

2-3

CODE OF ACCOUNTS AND ALLOCATION OF BUDGETS

2-8

ORIGINAL BUDGET DEVELOPMENT

2-10

PROJECT CONTROLS PLAN

2-10

SECTION 3 Summary of Jobsite and (Sub)Contracts Control Tools

3-1

INTRODUCTION

3-1

CONTRACT TYPES/METHODS OF PAYMENT

3-2

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Lump Sum (Fixed Price) Contract Based on Definitive Specifications

3-2

Lump Sum Design/Build (Engineering/Procurement/Construction) Contracts Based On Preliminary Design

3-2

Unit Price

3-3

Cost Reimbursable

3-3

Cost Plus Fee—Guaranteed Maximum

3-3

Cost Plus Fixed or Incentive Fee With Guaranteed Maximum and Shared Savings

3-4

Convertible Contracts

3-4

Time and Materials Contracts

3-4

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

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Bonus/Liquidated Damages Incentives Based on Time of Completion

3-4

Bonus/Liquidated Damage Incentives Based on Operation and Performance

3-5

Methods of Payment

3-5

Summary

3-6

CONTRACT FORMATION PROCESS

3-6

Planning

3-6

Project Implementation

3-6

Bid Package Development

3-7

Bid Period

3-8

Evaluation

3-8

Negotiation and Award

3-9

THE CONTRACT DOCUMENTS

3-9

The Proforma Family

3-9

Terms and Conditions

3-10

Exhibit C Data Request Forms

3-11

SELECTION/ASSIGNMENT OF CONTROL TOOLS/REPORTS

3-13

Assessment of the (Sub)Contractor’s Capabilities

3-13

Selection/Assignment of (Sub)Contractor-Submitted Control

3-14

Tools/Reports Bechtel Control Tools

RESPONSIBILITIES

3-18 3-20

(Sub)Contractor

3-20

Bechtel

3-21

ATTACHMENT 3-1, (SUB)CONTRACTOR SCHEDULING & REPORTING REQUIREMENTS

3-23

ATTACHMENT 3-2, RECOMMENDED CONTRACT LANGUAGE TO COVER PAYMENT REQUIREMENTS UNDER COST REIMBURSABLE (SUB)CONTRACTS

3-31

SECTION 4 Project Summary Reports

4-1

PROJECT PROGRESS REPORTING

4-1

PROJECT FINANCIAL REPORTING

4-3

PROJECT DATA SHEET

4-4

MILESTONE SUMMARY SCHEDULE (Level 1)

4-9

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FIELD PROGRESS AND RESOURCE CURVES

SECTION 5 Working Level Planning and Scheduling SCHEDULE HIERARCHY

4-9

5-1 5-1

Level 1—Milestone Summary Schedule

5-2

Level 2—Project Integrated Intermediate Schedule

5-3

Level 3—3/6 Month Rolling Schedules and Special Schedules

5-3

Level 4—Weekly Work Plan

5-3

CONSTRUCTION INTERMEDIATE SCHEDULE (Level 2)

5-7

3/6 MONTH ROLLING /SPECIAL SCHEDULES (Level 3)

5-14

WEEKLY WORK PLAN (Level 4)

5-15

SCHEDULE CHANGE PROCESS

5-17

(Sub)Contract Related

5-17

Prime Contract Related

5-17

RESOURCE PLANNING FOR (SUB)CONTRACT MANUAL LABOR

5-21

COSTRUCTION INTERMEDIATE SCHEDULE 3/6-MONTH ROLLING SCHEDULE REVIEW

5-21

WEEKLY WORK PLANNING REVIEWS

5-22

Review Process

5-22

Schedule Analysis

5-23

QUANTITY CURVES Development

5-27

Evaluations

5-28

QUANTITY REPORTING SYSTEM

5-29

System Description

5-30

Automation

5-31

ATTACHMENT 5-1, QUANTITY REPORTING

SECTION 6 Working Level Cost Control FIELD RELATED ACCOUNTING

5-33

6-1 6-1

Automation

6-1

Use of Centralized Accounting Function Approaches

6-2

(SUB)CONTRACT MONITORING/MATERIALS COST CONTROL

6-3

Overall (Sub)Contract and Materials Cost Control

6-3

Detailed Control of (Sub)Contracts

6-4

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Cost and Commitment Automation

6-11

DISTRIBUTABLE REPORTS

6-13

ATTACHMENT 6-1, PROJECT CONTROLS DELIVERABLES MATRIX COST CONTROL

6-27

ATTACHMENT 6-2, DEFINITION OF SYSTEM APPLICATIONS

6-29

ATTACHMENT 6-3, MATERIAL ASSIGNMENT SCHEDULE FOR GENERIC FOSSIL PROJECT

6-33

SECTION 7 (Sub)Contract Progress and Coordination Reviews

7-1

DAILY REPORTS

7-1

REVIEW MEETINGS

7-1

Sample Agenda

7-4

COORDINATION MEETINGS

7-4

CONTRACT COORDINATOR’S ROLE

7-4

COST AND SCHEDULE SUPPORT

7-4

SECTION 8 Trending and Forecasting

8-1

TREND PROGRAM AND CHANGE CONTROL

8-1

Trend Program

8-1

Scope Changes

8-11

Construction Work Orders

8-17

FORECASTS

8-18

Overview

8-18

Quantity Development

8-20

Material Analysis

8-21

(Sub)Contract Analysis

8-21

Distributable Services Support (Sub)Contracts Analysis (Bechtel Related)

8-22

Distributable Material Cost Analysis

8-22

Construction Equipment Analysis(Bechtel Supplied)

8-22

Field Nonmanual Labor and Field Office Cost Analysis

8-23

ATTACHMENT 8-1, ASSESSMENT OF SCOPE CHANGE

8-27

ATTACHMENT 8-2, SAMPLE FORECAST PRESENTATION

8-29

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APPENDIX A

Glossary of Terms

A-1

APPENDIX B

Field Scheduling Guidebook, (Sub)Contract Execution

B-1

APPENDIX C

Example Resource-Loaded Schedule Analysis

C-1

APPENDIX D

Contract Division of Responsibility Matrix

D-1

APPENDIX E

PCWorks Project Cost Module Reports (PDF)

E-1

APPENDIX F

Trend Report Template for Lump-Sum Projects*

F-1

APPENDIX G Trend Report Template for Reimbursable Projects*

G-1

APPENDIX H

Bulk Commodity Curve Templates*

H-1

APPENDIX I

Progress, Performance and Resource Curves/Reports*

I-1

* SEE THE ATTACHED DISC FOR THESE MICROSOFT EXCEL TEMPLATE FILES.

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Section 1

Introduction Effective project control is the glue that binds together the Engineering, Procurement, Construction, and Commissioning work processes on successful Bechtel projects and allows the project team to function as an integrated unit. Bechtel manages a wide variety of construction projects in many cultures and geographic locations, and a significant amount of work is being executed employing (sub)contracted manual labor. The Principles of Construction Controls, Volume II, (Sub)Contract Execution defines the standard project control work process for projects being performed exclusively using (sub)contracted manual labor. In addition to establishing mandatory field controls work process standards, The Principles of Construction Controls, Volume II, (Sub)Contract Execution also recognizes and incorporates the powerful benefits of corporate Engineering, Procurement, Construction–Process Innovation initiatives and embraces the concept of reducing net present values and total installed costs for our customers. This handbook also recognizes and capitalizes on the benefits that can be derived from the integration of cross-functional work processes and from the adoption of advanced automation and telecommunication technologies in project execution.

BECHTEL CONSTRUCTION OPERATIONS GUIDING PRINCIPLES The following guiding principles have been adopted by Bechtel Construction Operations regarding the management, planning, and control of construction work execution: 1. Cost and schedule processes are to be integrated so that there is consistency and agreement. 2. Engineering, Procurement, Construction, Pre-commissioning, and Startup (Commissioning) planning and control processes are to be integrated and monitored by the project team. 3. Lower level budgets and plans are to be tested and validated against higher level control tools to avoid inconsistencies. 4. Complete buy-in and commitment to planning and control tools are to be achieved through active participation, in the review process, by project personnel responsible for execution and all participating Regional Industrial Unit and Execution Unit organizations. 5. Basic standards and formats of information are to be established for use on all Bechtel construction projects. 6. Automation technology will be maximized to enhance quality, consistency, effectiveness, timeliness, and integrity of information. 7. Internal, off-project management reports will be provided in a summary format, with intent to minimize duplication and report volume and to maintain an appropriate level of information provided.

PURPOSES AND OBJECTIVES 1. To document the overall philosophy and guiding principles to be implemented to manage, plan, and control cost and schedule activities on all Bechtel construction projects employing (sub)contracts.

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Introduction

2. To define management planning and control methods, responsibilities, and procedures to control the following elements of fully (sub)contracted and/or construction management projects (excluding Operating Plant Services projects): •

Quantities - Forecast and Takeoffs; Purchased, Received, and Installed

•

(Sub)contractor - Cost, Jobhours, Performance, and Progress

•

Field-Purchased Materials and Costs

•

Distributable Costs - Indirect Manual Labor, Nonmanual Labor, Site Communications, etc.

3. To support the emphasis placed on management philosophy and project cost and schedule performance tools. •

This handbook draws heavily from the Bechtel Group Incorporated (BGI) Project Controls Procedures Manual. The BGI procedures are the controlling documents for project controls. As such, numerous cross references are contained in this handbook to assist in locating additional information and backup.

4. To establish guidelines for standardized reporting on Construction projects. It is expected that functional groups such as Project Controls, Accounting, Contracts Administration, and Procurement will continue to maintain and develop procedures and systems in further detail, as deemed necessary, to support their functional responsibilities in project execution. 5. To establish standard formats and methods that will allow for maximum use of automation technologies to improve the quality and effectiveness of the planning and control process. 6. To improve confidence level regarding quality and consistency of management information and in management's use of the data provided. This is to be achieved by standard, streamlined reports based on integrated data that have been balanced to total project scope. 7. To provide a basic specification of the information requirements that project controls will be required to furnish to site management for site control. 8. To assist in the development of construction personnel and improve their understanding of Bechtel’s basic project controls work processes. In summary, the 1998 Edition of the Principles of Construction Controls, Volume II, (Sub)Contract Execution is specifically targeted, on a global basis, to achieve the following: •

Define standard field controls work processes for fully contracted construction projects

•

Provide field controls personnel with the information required to establish and maintain effective field controls for fully contracted construction projects

•

Provide the basis for employee development on the basics of field controls

DOCUMENT SCOPE The Principles of Construction Controls, Volume II is the (sub)contracts counterpart to the direct hire version – Volume I. As is Volume I of the Principles of Construction Controls, so is this volume focused on the construction site field controls work process and closely aligned with the Bechtel Group Incorporated (BGI) Project Controls Procedures Manual and Bechtel’s ProjectWorks suite of standard automation tools.

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In addition, since it is specifically geared to control of (sub)contracts, it is also closely aligned to the following: •

Contracts/Subcontracts Formation Manual (Blue Book)

•

Contracts/Subcontracts Management Manual (Brown Book)

•

Contracts/Subcontracts Coordination Handbook

•

Contracting Guidelines No. C-1, Construction Participation in (Sub)Contract Formation

•

Prime Contract Management Manual

•

Corporate Policy Number 230, Procurement of Goods and Services

Also refer to other project controls and contracts-related procedures issued on a regional basis, as these will provide additional specific direction. This handbook covers (sub)contract execution but will necessarily address prime contract impacts and related control requirements. The terms prime contracts and (sub)contracts are used throughout this handbook to clarify which Bechtel interface is being addressed. (Sub)contracts are used for work execution within a number of different overall frameworks ranging from construction management to complete responsibility for engineering, procurement, construction, and startup. The requirements of this handbook are directly applicable to all (sub)contract execution work where Bechtel has the full management responsibility for construction. Bechtel may be either working under a self-performing arrangement or acting as an Owner agent (i.e., construction management). The assumption is that the control requirements are needed and that staffing arrangements will support the workload. When Bechtel is acting as an Owner agent it may not have full responsibility for execution, because Bechtel’s role may be one of providing services (Note: this may still be referred to as construction management). The control tools and approaches can vary significantly, since the role for Bechtel may vary. The Owner may require specific control tools not normally used by Bechtel. And the staffing levels paid for may not be sufficient to support Bechtel’s full array of control tools. It is advisable to review both Bechtel’s control and (sub)contract management work processes with prospective customers to see if the overall approach may be strengthened. There may be other situations where the process and the tools need to be adjusted as necessary to meet the contractual needs. For instance, where work is performed as a fully integrated joint venture, the project team must review the project partner’s control tools at the outset of the project and establish, in the project division of responsibility, which tools will be used. Control tools and processes must be carefully selected. It is important that these selections be made to ensure proper control of the job during project execution from Bechtel’s perspective, even if this means adding to the set specified by clients for their needs. While the handbook’s focus is the execution phase, it is emphasized that effective execution can only be ensured through effective proposal/bid/contract development. All functional areas need to be well represented early in the proposal process to ensure that all requirements are part of the (sub)contract well before final signoffs.

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Section 1

Introduction

During the bidding phase it is most important that Contracts and Project Controls work closely. The requirements, including the types of reports, the content, and the frequency of issue, must be well defined in the original Issue for Bid package. The early interface with the (sub)contractors should address the control reporting requirements so that they are clearly understood. Also, constructability evaluations are most important in the proposal stage and the initial phase of project execution. Improvements or solutions to difficult erection issues can be more cost effectively addressed and implemented early on. A construction coordinator, assigned early, can facilitate the process of getting a cost-effective design to the field in a timely manner so that delays and rework are avoided. Refer to Section 3 for details on establishing the control requirements during the proposal/bid stage.

THE PROJECT CONTROL CYCLE The Project Control Cycle, shown in Figure 1-1, defines Bechtel’s guiding principles regarding the management, planning, and control of construction work execution. This handbook is organized around the implementation of this cycle on Bechtel construction projects.

SCOPE CHANGES

SCOPE DEFINITION * PHYSICAL SCOPE * DIVISION OF RESPONSIBILITY * ESTIMATE (COST & SCHEDULE)

PRIME CONTRACT

TRENDS

EXECUTION PLAN * BUDGET * SCHEDULE * METHODS

CORRECTIVE ACTION

INTEGRATED PROJECT CONTROL

* BUDGET ADJUSTMENT * SCHEDULE ADJUSTMENT * METHOD ADJUSTMENT

BECHTEL OWNER

FIELD CONTROL PLAN

MONITORING PLAN * COST * SCHEDULE

DEVIATIONS ACTION ITEMS

* * * *

IDENTIFICATION TRENDING FORECASTS REPORTING

WEEKLY REVIEWS

FIGURE 1-1 - THE PROJECT CONTROL CYCLE

Once the contract has been awarded, the Bechtel project team develops a detailed project execution plan, which includes detailed budgets, schedules, and work method selections. This plan includes information that is used as the basis for developing the construction plan and budget included in the field control plan for the project construction phase. During the execution of the construction work, the construction team monitors its budget and schedule performance, evaluates deviations, and implements corrective actions in accordance with the field control plan. This handbook focuses on the field control processes and related reporting systems for these last three elements of the control cycle: •

Monitoring the Plan

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•

Evaluating Deviations

•

Implementing Corrective Actions

It does this by initially identifying the summary level reporting process, followed by the working level control process descriptions for schedules and cost that support it. The handbook concludes with sections on the (sub)contract progress and coordination reviews, the trend program, and the forecasting process, which evaluate cost and schedules together to facilitate identification of proper corrective action. The sections in the handbook in general address either the prime contract interface or the (sub)contract interface. Sections 2, 4, and 8 deal primarily with the former, and Sections 3, 5, 6, and 7 cover the latter. To assist project-assigned personnel in implementing the concepts outlined in the handbook, a number of sample reports and electronic templates have also been included. The Categories used in these sample reports are examples only and are not intended to replace the standard categories used by different business lines.

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Section 2

Project Controls Planning OVERALL CONTROL CYCLE AND PROJECT PLANNING The key elements of the project control cycle include establishing the project scope definition and execution plan, monitoring progress and performance, identifying and reporting deviations, and applying corrective actions. The starting point for the control cycle is the development of the project estimate. From this estimate the project plan is developed. The project plan includes the scope, the execution plan, the baseline schedule, and the original budget.

SCOPE To be meaningful, scope must be defined at a detailed level in accordance with the contractual commitment/requirements and the engineering design documents. Therefore, all facilities, equipment, and controls are identified and described. Metrics for the size of the facilities; equipment ratings; and anticipated quantities of equipment, controls, and required bulk materials are needed to fully define the scope. Also, specific metrics should be included to define the facility’s performance. The latest design drawings and criteria further define the scope. A Division of Responsibility should be part of every prime contract arrangement. This notes who does what, and this may have major implications to the field work for the project. Exclusions and areas of responsibility handled by others should be clearly documented. The project execution plan covers the description of services, procedures, basis for work plans, and Bechtel’s project organization. It emphasizes how the work will be done. Often the scope of services document is attached to the prime contract. Generally it covers engineering, procurement, construction, commissioning (startup), and selected controls-related items. Normally, invoicing, progress reporting, and change control procedures are included in the selected controls items. Construction, Contracts, and Project Controls have manuals, handbooks, and generic procedures, which are available to assist those responsible for developing the project-specific procedures. These project procedures are normally maintained internal to Bechtel and outline the division of responsibilities within Bechtel among management organizations, departments, and individuals. Additional plans, such as the Project Controls Plan, the Automation Plan, and the Contracting Plan (also known as the Material Assignment Schedule [MAS]), are referenced in the execution plan. The Project Controls Plan is covered in more detail later in this section.

PROJECT SCHEDULING Overall, there are four levels of scheduling: •

Level 1 is the Milestone Summary Schedule.

•

Level 2, known as the Project Integrated Intermediate Schedule, integrates engineering, procurement, construction, and commissioning (startup).

•

Level 3 includes 3/6-Month Rolling Schedules and special schedules that expand on the intermediate schedules.

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Section 2

•

Project Controls Planning

Level 4, the Weekly Work Plan, provides the detailed activity breakout for work on a day-by-day basis.

The Milestone Summary Schedule provides the execution framework on a timescale and is based on meeting management’s objectives. This schedule graphically presents the major work scope and incorporates all important due dates. The Milestone Summary Schedule serves as a basis for more detailed schedules and establishes a benchmark against which to measure progress. The schedules present a logical sequence for completing work, taking into account available resources such as manual staffing and construction equipment, as well as external constraints such as owner-supplied items. Each of the subsequent levels further defines the project plan. Along with related resource allocation and bulk materials installation plans, these schedules provide a basis for monitoring project progress. In accordance with the control cycle process, deviations that are identified in this monitoring process should lead to timely corrective actions. It is noted these deviations may result in (sub)contractor pricing increases, and early identification can help to mitigate the impacts.

PROJECT BUDGETS The Original Budget sets the financial baseline using the most recently developed estimate and is the foundation for all cost control systems. This budget will be refined as additional detail is required for project execution and as additional information becomes available. Figure 2-1 shows the overall cost control process starting with the Original Budget. This budget is also referred to as the Trend Base at the beginning of the project. The client, Bechtel management, and the project team recognize the Trend Base as the base for identifying variances and deviations. Generally, on lump sum projects the Trend Base remains the same as the Original Budget from the beginning to project completion. For cost reimbursable projects, the Trend Base may change because the budget may be reset as the project evolves or annual budgets may be required.

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Project Controls Planning

Section 2

Adjustments

Scope Change & Adjustments

Current Budget Scope Changes

Original Budget

Trend Base

Trends

Resolved

Other Trends

Current Forecast

No Impact

Unresolved

Cancelled

FIGURE 2-1 - OVERALL COST CONTROL FLOW CHART

There are two general categories of modifications to the Trend Base: ones that do not affect the value of work (e.g., transfers) and ones that do. Modifications that change the value of work are called trends. Trends include changes to project scope, pricing, schedule, or intended plant quality that cause an addition or reduction to the trend base. Trends also include corrections for scope/estimate omissions. Note that both schedule and financial variations are tracked. Trends are classified as scope change trends or other trends. Scope change trends are items of change to the Trend Base requested by the client, recommended by Bechtel, or required by regulatory agencies and subsequently documented to the client by the project scope change program. Other trends are those variations that cannot be classified as scope changes, but are attributable to project evolution or other developments. The status of trends is categorized as resolved or unresolved. Resolved trends include those items that have been approved by the project manager for inclusion in the project. Unresolved trends are those that have not been approved and require further action to become resolved. It is noted that resolved and unresolved trends may be canceled at any time if it is determined that there are neither schedule nor cost impacts. Resolved trends are reflected in the Current Budget if they are client-approved scope changes. The Current Budget is, therefore, the Original Budget plus all client-approved scope changes, orders, and budget adjustments (e.g., transfers). All changes in the Current Budget are reflected in the forecast. In addition, the other resolved trends are also included as part of the forecast updates. Therefore, the Current Forecast equals the Original Budget plus all resolved trends and transfers. The Current Forecast reflects the current approved forecast, which means it has been reviewed (usually quarterly) and accepted by Execution Unit (EU)/Regional Industry Unit (RIU)/Construction Management and is reflected in the current Project Financial Status Report, which documents the official financial status of the project.

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Section 2

Project Controls Planning

BUDGET CONTROL The budget control process flow chart shown in Figure 2-2 depicts the development of the Original Budget and the maintenance of the budget. The first steps shown involve the development of the cost codes. Both the Work Breakdown Structure (WBS) and a coding system are employed in the development process. A WBS is the top-down, logical structuring of the project scope that defines and displays all of the work to be performed in accomplishing the project objectives. The coding system, which is referred to as the Standard Code of Accounts (COA), assigns an alphanumeric code to a standard WBS and includes all the work required to complete a typical construction project. The cost code contained within the COA is the key method of assigning commodity information; it is completely numeric. Typically, the WBS, Organizational Breakdown Structure (OBS), and COA will have been developed during the proposal stage of a project, but will be refined following notice to proceed. The (on-)project controls manager is responsible for establishing the level of detail and the interface points between cost and schedule for the project. The basis for cost and schedule integration is the WBS, supported by the COA and the OBS. Figures 2-3 through 2-5 demonstrate this relationship. Figure 2-3 is an example WBS for a project. In the example, each successive level bores deeper into the detail, eventually highlighting the contents in a specific work package. Figure 2-4 highlights the levels within the WBS hierarchy.

DEVELOP COST CODES REVIEW

OBTAIN STANDARD

PROJECT

PROJECT CODE

ESTIMATE

OF ACCOUNTS

OBTAIN MATERIAL ASSIGNMENT SCHED. AND OTHER INPUT FROM PROJECT TEAM ON HOW PROJECT WILL OPERATE.

SELECT

PRELIMINARY TO

COST CODES FROM

PROJECT TEAM

STANDARD CODES

AND PROJECT

BASED ON PROJECT

CONTROLS MANAGER

REQUIREMENTS

FOR REVIEW.

INCORPORATE COMMENTS AND ISSUE.

DEVELOP ORIGINAL BUDGET USE HISTORICAL DATA, ESTIMATE BACKUP, CONST. INPUT, ETC, TO FURTHER SPREAD DIRECTS INTO DETAILED COST CODES.

SPREAD BECHTEL SERVICES COSTS TO BUDGET.

PRELIMINARY SPREAD OF ESTIMATE DIRECTS TO COST CODES.

MAKE SURE TOTAL MATCHES ORIGINAL ESTIMATE.

ISSUE FOR PROJECT TEAM REVIEW AND PROJECT CONTROLS REVIEW.

INCORPORATE COMMENTS AND ISSUE FOR USE.

AFTER APPROVAL OF TRENDS OR TRANSFERS, INCORPORATE INTO BUDGET CONTROL PROGRAM

ISSUE CURRENT BUDGET AS NECESSARY.

USE HISTORICAL DATA, ESTIMATE BACKUP, CONST. INPUT TO BREAK DISTRIBUTABLE HOURS AND COST INTO DETAILED COST CODES.

SPREAD ESCALATION OVER ALL COSTS AS NECESSARY.

PUT REMAINING ITEMS (COST OF CAPITAL, FEE, CONTINGENCY, ETC.) IN PROPER ACCOUNTS.

MAINTENANCE BUDGET PREPARE TRENDS AND TRANSFERS AS THEY ARE IDENTIFIED.

FIGURE 2-2 - BUDGET CONTROL PROCESS FLOW CHART

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Project Controls Planning

Section 2

In Figure 2-5, the WBS is shown starting in the upper right. It identifies construction areas and related work packages. Each work package has an associated schedule (depicted) and a related control account. The control account is defined using cost codes, which allows the work to be crossreferenced to the organizational structure shown on the left. The influences of the OBS and the COA must be considered when establishing levels of cost and schedule interfaces. Normally, both will function as the conduits for collecting and organizing data in the format and structure necessary to update the selected levels of schedule with current status information. Refer to Project Controls Department Procedure (PCDP) 1.01 for rules and descriptions for developing the WBS. Projects need to incorporate the concept of total installed cost (TIC), where the entire scope and budget of the project are divided into TIC elements based on the specifics and scope of the project. Under this approach the focus of project execution becomes more process-based (e.g. civil, mechanical, electrical). Budgets and schedules are viewed, controlled, and evaluated from this perspective. This concept may be formally adopted into the project’s organizational structure as shown in Figure 2-6 or may be enacted on the project using a less formal approach but still employing team-building concepts.

LEVEL TOTAL PROJECT

1

2

ENGINEERING

5

BOILER

TURBINE

CONTROLS

FLUE GAS

FUEL

FOUNDATION

BLDG. STEEL/ ENCLOSURE

COMBUSTION TURBINE

STEAM TURBINE

MECHANICAL EQUIPMENT

ELECTRICAL EQUIPMENT

STEEL DESIGN PACKAGE

HVAC DESIGN REQUIREMENT

ARCHITECTURAL PACKAGE

FOUNDATION PACKAGE

PILING PACKAGE

FIRE PROTECT. PACKAGE

SPEC/MR/PO

DESIGN DRAWINGS

DESIGN TASKS

SITE GRADING PLANS

PILING LOC. PLANS

PILING DESIGN DRAWINGS

6

7

CONSTRUCTION

SITE/YARD

3

4

PROCUREMENT

STARTUP

WATER TREATMENT

MISC.

FIGURE 2-3 - EXAMPLE WORK BREAKDOWN STRUCTURE

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Section 2

Project Controls Planning

1 Project 2 Department 3 Facility 4 Commodity Group 5 Commodity 6 Commodity Detail 7 Additional Commodity Detail As Needed

PROJECT

FIGURE 2-4 – LEVELS WITHIN WORK BREAKDOWN STRUCTURE

PROJECT

WORK BREAKDOWN STRUCTURE (WBS)

WBS ELEMENT

SUB PROJECT

TYPICAL

(PROJECT PHASE)

CONSTRUCTION

STARTUP TYPICAL

PROCESS AREAS

(MAJOR COST ELEMENTS)

OFF-SITE AREAS

INDIRECTS TYPICAL

(PLANNING AREAS)

UNIT 50 HYDRO TREATER

UNIT 60 HYDROGEN

UNIT 70 SULFUR

UNIT 80 SOUR WATER STRIPPER

(CONSTRUCTION AREAS)

CIVIL/ STRUCTURAL PROJECT MANAGEMENT PLANT DESIGN PROCESS

AREA 51

AREA 52

AREA 53 (Typical) 90 DAY ROLLING CPM - ACTIVITY As Required

CONTROL

CONTROL

ACCOUNTS

ACCOUNTS

CONTROL

CONTROL

ACCOUNTS

ACCOUNTS

CONTROL ACCOUNTS

CONTROL

WORK PACKAGES

OVERHEADS EXPENSES

Responsible Discipline

LABOR SERVICES

Cost Type

MATERIALS

OTHER OFFICE HOME OFFICE FIELD

ENTITY

ORGANIZATIONAL BREAKDOWN STRUCTURE (OBS)

Responsible Organization

Location Work Is Executed

PACKAGE #1

PACKAGE #2

(Typical) CONTROL LEVEL SCHEDULE - Tasks As Required

Detail Line

PACKAGE #3

ACCOUNTS

CONTROL ACCOUNTS (Cost Code Numbers)

FIGURE 2-5 - RELATIONSHIP BETWEEN WBS, OBS, AND CODE OF ACCOUNTS

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GENERAL NOTES:

PROJECT TEAM >

o CURRENT FUNCTIONAL REPORTING RELATIONSHIP REMAIN IN PLACE! o FUNCTIONAL DEP'TS COORDINATE WORK/LESSONS LEARNED TO DEP'T

PROJECT MANAGER

PROJECT ENGINEER

EXAMPLE TIC TEAM (See Note Below)

SITE MGR Proj Sup't/PFE C/S Supv,S/C

HO PROC MGR

HO PROJ CNTRL MGR

STARTUP MANAGER

CIVIL TEAM

| |

CIVIL EGS

| |

LD CIVIL SUPT LD CIV FLD ENG

| |

PROC REP

| |

PROJ CNTLS REP

| |

MECH TEAM

| |

MECH EGS

| |

LD MECH SUPT LD MECH FLD ENG

| |

PROC REP

| |

PROJ CNTLS REP

| |

STARTUP REP

PIPING TEAM

| |

PLT DES EGS

| |

LD PIPING SUPT LD PIPE FLD ENG

| |

PROC REP

| |

PROJ CNTLS REP

| |

STARTUP REP

I & C TEAM

| |

CNTRL EGS

| |

LD I&C SUPT LD I&C FLD ENGR

| |

PROC REP

| |

PROJ CNTLS REP

| |

STARTUP REP

ELEC TEAM

| |

ELEC EGS

| |

LD ELECT SUPT LD ELEC FLD ENG

| |

PROC REP

| |

PROJ CNTLS REP

| |

STARTUP REP

SPECIAL TEAMS

| |

RESP ENGRS & MGRS

| |

RESP SUPT RESP FLD ENGR

| |

PROC REP

| |

PROJ CNTLS REP

| |

STARTUP REP

NOTE: Each Project, based on scope, will determine optimum TIC Team structure.

FIGURE 2-6 - TOTAL INSTALLED COST PROJECT ORGANIZATIONAL STRUCTURE

Process-based control involves performing evaluations with the objective of optimizing the cost and schedule scope of that process, considering both specific scope and overall project scope. The evaluation teams should draw on the project-assigned expertise of the functional departments, with members from Engineering, Procurement, Construction, Startup, and Project Controls being assigned as required. The TIC program empowers all personnel, fostering an awareness of the cost impacts that the daily decision-making process has on a project. This awareness should result in incorporating cost effectiveness into these decisions, yielding the lowest cost outcome without compromising quality in the process. The assigned teams are empowered to make engineering, procurement, construction, and commissioning tradeoffs (with project team concurrence), and the team’s effectiveness is measured on its entire budget, not individual department budgets. Essential to the success of reducing TIC is the project team’s focus on reducing the impacts of quantities. This focus must include pre-quantity issuance recognition of deviations to the project estimate basis/budget and a proactive engineering, procurement, construction, and commissioning team approach to reducing the TIC impacts of quantity design. To accomplish this, an effective turnover of the scope basis from the proposal team to the executing team and an aggressive management of scope growth are necessary. The following are additional characteristics of the TIC process: 1. Forecasting is performed on an ongoing basis, with reports being updated as deviations are identified. Trend summaries, commodity curves, etc., are updated with the latest information when issued and do not wait for management approval before incorporation. 2. Budget Transfers: With the team’s empowerment to optimize the engineering, procurement, construction, and commissioning cost components within its scope of responsibility, it is recognized that scope and work will be transferred between departments within the team. Since the performance of the team is the focus of the program, minor budget transfers between the individual budgets are not required. However, if a major scope transfer occurs such as performing

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a function that was budgeted as a subcontract (use transfer > 1,000 jobhours or $100 K) the project has the flexibility to enact a transfer. The purpose of this is to avoid expending resources in minor transfers when the bottom line TIC is the focus. 3. Bulk Commodities are adjusted as required monthly to reflect the latest engineering design. Schedule and cost impacts are reviewed as part of the monthly reporting process. 4. Stretch Targets and Strategies are established for each assigned evaluation team and then integrated with the overall stretch goal strategy by the project team. Progress against these targets is shared with the teams on an ongoing basis. 5. Project Reviews, both internal and off project, may be structured by the TIC team rather than by the department breakdown used if the formal organizational approach is taken. The update of the Project Controls Department Procedures (PCDP) scheduled for 1998 will incorporate TIC concepts into the revised documents. It is important to note that TIC concepts should not be used to dismiss the need to track individual metrics. Tracking items such as jobhour expenditures is still very important to properly monitor a project and assess performance.

CODE OF ACCOUNTS AND ALLOCATION OF BUDGETS All Bechtel companies, Regions, Industry Units, Special Operations and Services, and designated associates and affiliates have adopted the Standard COA for use. As shown in Figure 2-7, the overall Cost Account is a 6-to-11-character code that identifies labor, material, subcontract, or revenue items by a specific project Subdivision, Locator, and Cost Code.

Bechtel Job No.

SubLocator division

. Detail

Cost Type

Commodity Commodity Group Category Cost Code Cost Account FIGURE 2-7 - COST ACCOUNT DEFINITION

The Subdivision code is a one-to-three-character code used to break the project down into major facility groups (e.g., units in a power plant or trains/product lines in a petrochemical or mining project). Both alphabetical and numerical characters are employed. The Locator code is a two-character code that defines a physical area of the project. It may be either alphabetical or numerical. Standard Industry Locator codes are used, if available. On a power plant project, the Locator code could designate the boiler (steam generation process); on a petrochemical project, the Locator code could designate the refining process area.

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The Cost Code is a three-to-six-character code that identifies labor, material, subcontract, or revenue items. All characters are numeric: •

The category of work is the first character. Examples include bulks, general equipment, special equipment, etc.

•

The commodity group is the second character. Concrete, steel, architectural, piping bulks, electrical bulks, and instrumentation are examples of commodity groups included in the bulk category of work. Pumps, compressors, heat exchangers, and tanks are examples of commodity groups included in the general equipment category of work. Steam turbine generators, precipitators, switchyards, columns and vessels, fired heaters, and steam generation equipment are examples of commodity groups included in the special equipment category of work.

•

The third character adds further detail related to the commodity group. Formwork, reinforcing steel (rebar), embeds, and concrete placement are examples of details within the concrete commodity group.

•

The final three characters provide additional detail breakdowns. Examples of additional detail reporting for reinforcing steel would be special detail codes for wall reinforcing and slab reinforcing.

An example of a complete Cost Account is shown in Figure 2-8.

1

B G

1 5

.

3 1

Detail Commodity Commodity Group Category Locator Subdivision FIGURE 2-8 - EXAMPLE COST ACCOUNT

In using this system, the project team has the flexibility of defining the level of reporting detail appropriate for the project. However, there are minimum levels of detail that are mandatory to track material, subcontract, and labor costs. This is to ensure consistency in reporting historical costs. The required breakdowns are defined in the Standard COA. It is to be noted that in certain instances, portions of the Cost Account (e.g., subdivision designator) may not be required by PCWorks or the accounting system. Nevertheless, the Cost Code will need to be completely defined. The definitions of work categories and commodity groups must, however, remain consistent in all applications. Refer to Project Controls Department Procedure 4.11 for more information on COA.

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The Project COA should be developed in agreement with the Standard COA by identifying the applicable/required codes within the COA. Additional detail may be added through extensions, but these must be developed in a way that ensures proper roll-up and avoids multiple definitions for the same code over time. Therefore, the added codes must be extensions of the most detailed codes defined in the Standard COA. When establishing the Project COA, the following should be considered: •

The level of detail should be consistent with the control required, both in the Design Office and the field, and be compatible with the WBS and the OBS.

•

The COA should be consistent with activities necessary to establish responsibility for performance, both in the Design Office and in the field.

In ensuring the consistency noted above, items such as the MAS that specify how the project will operate, as well as project requirements, need to be taken into account. The preliminary Project COA should be reviewed with the Project Team and the project controls manager. After incorporating all comments, the Project COA is issued for use. As noted on the flow chart shown in Figure 2-2, the budget development process allocates the estimate, including Bechtel services cost, to correspond with the breakdown in the Project COA. Budget allocations relate to items of work that are clearly the responsibility of an individual or organization and must provide information to enable the project team to control the work before it commences. Direct and distributable cost items may require considerable work to be matched up with the detail codes specified. Use of historical data, estimate backup, and additional construction input is recommended. Escalation is addressed next. On most projects, escalation is allocated over all costs, as necessary. On selected reimbursable projects, the client may require that escalation (normally a separate line in the estimate) be held as a separate account. The process continues with the placement of the remaining items such as cost of capital, fee, contingency, etc., in the proper accounts. After checking to be sure the preliminary budget distribution matches the estimate, the Project Team and project controls management review the budget. Comments are incorporated, and the original budget is officially released for use. An example is shown in Figure 2-9.

ORIGINAL BUDGET DEVELOPMENT On cost-reimbursable projects where Bechtel has been awarded engineering, procurement, construction, and commissioning (startup) responsibilities, original budgets are prepared from the preliminary project estimate. A more detailed and definitive project estimate is subsequently developed based on a technical scope document that typically includes piping and instrumentation diagrams, plot plans, general arrangements, and electrical single-line diagrams. At this point, engineering is approximately 20 to 40 percent complete and/or construction is about to begin. In addition, selected major equipment awards have been made. This estimate forms the basis for developing detailed budgets for engineering and other Design Office costs, quantities, construction labor, equipment, material, and subcontract costs. On lump-sum projects, the original budget is developed directly from the proposal estimate, adjusted for any subsequent changes in scope and price resulting from contract negotiations, clarifications, and tender documents. The original budget includes all the scope defined in the proposal and/or scope book. For projects with engineering and design by others, the original budgets are based on the bid

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estimate and the conformed contract at time of award. The bid estimate values are distributed to the appropriate accounts for monitoring and control. The maintenance of the budget is noted in sufficient detail earlier in this section. Refer to Project Controls Department Procedure 4.01 for more information on budget development, maintenance, reviews, and approvals.

PROJECT CONTROLS PLAN Subsequent to notice to proceed, the (on-)project controls manager is responsible for preparing the detailed Project Controls Plan. The scope of the Project Controls Plan includes all design and field office aspects of the project controls functions, such as estimating, cost control, planning and scheduling, financial reporting, and their related automated systems, as applicable. It contains: •

The project controls staffing requirements over the project and the applicable project-specific procedures

•

The definition of the project controls deliverables and identification of key areas of responsibility

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COST CODE

Project Controls Planning

DESCRIPTION

15.2011 Small Bore Pipe 15.2012 Small Bore Pipe 15.2100 Small Bore Pipe Carbon 15.2300 Small Bore Pipe Stainless 15.2800 Small Bore Pipe 15.3100 Large Pipe 2-1/2" Carbon 15.3101 Large Pipe 3" Carbon 15.3102 Large Pipe 4" Carbon 15.3103 Large Pipe 6" Carbon 15.3104 Large Pipe 8" Carbon 15.3300 Large Pipe 3" Stainless 15.3301 Large Pipe 4" Stainless 15.3302 Large Pipe 6" Stainless 15.3303 Large Pipe 8" Stainless 15.3400 Large Pipe 2-1/2" Chrome 15.3660 Floor Drains 15.3800 Large Pipe 15.3801 Large Pipe 4" 15.3802 Large Pipe 6" 15.3803 Large Pipe 8" 15.4100 Large Pipe 12" Carbon 15.4101 Large Pipe 16" Carbon 15.4300 Large Pipe 12" Stainless 15.4402 Large Pipe 13" Chrome 14.4800 Large Pipe 10" 15.4801 Large Pipe 12' 15.5100 Large Pipe 20" Carbon 15.5400 Large Pipe 20" Chrome 15.5800 Large Pipe 16" 15.5100 Large Pipe 18" 15.5802 Large Pipe 20" 15.6100 Large Pipe 30" Carbon 15.6910 Large Pipe 30" Concrete 15.7011 Large Bore Pipe Hangers 15.7021 Large Bore Pipe Hangers on 15.7030 Large Bore Pipe Hangers from 15.8100 Stress Relieving 15.9316 NDE

QTY 986 44 2,254 347 55 65 31 167 266 716 16 15 72 39 4 407 152 869 327 49 251 1 36 16 389 141 27 16 41 49 40 84 420 213 138 67 226 269

UOM EA EA LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM LM EA EA EA EA EA

INSTALL MATERIAL EXTENDED EXTENDED EXTENDED RATE RATE INSTALL MATERIAL TOTAL 37.76 6.90 6.41 6.24 6.67 13.23 15.82 17.83 25.79 33.69 10.30 11.45 25.60 27.65 12.55 10.36 6.40 6.87 7.60 14.64 75.28 67.61 58.69 209.90 13.69 15.84 98.56 98.56 18.67 18.67 20.59 42.49 19.81 9.60 8.61 9.60 323.59 59.44

34.17 0.01 6.87 71.39 1.81 19.72 17.85 23.06 39.98 69.99 119.67 169.33 342.62 719.16 0.43 123.25 6.67 15.96 24.38 43.82 154.08 209.40 573.82 26.48 51.69 72.67 489.65 6.05 144.78 144.78 178.82 664.18 664.15 74.00 56.93 74.00

37,231 304 14,448 2,165 367 860 490 2,978 6,860 24,122 165 172 1,843 1,078 50 4,217 973 5,970 2,485 717 18,895 68 2,113 3,358 5,325 2,233 2,661 1,577 765 915 824 3,569 8,320 2,045 1,188 643 73,131 15,989 251,117

33,692 0 15,485 24,772 100 1,282 553 3,851 10,635 50,113 1,915 2,540 24,669 28,047 2 50,163 1,014 13,869 7,972 2,147 38,674 209 20,658 424 20,107 10,246 13,221 97 5,936 7,094 7,153 55,791 278,943 15,762 7,856 4,958

759,950

70,923 304 29,933 26,938 466 2,142 1,044 6,829 17,495 74,235 2,080 2,712 26,512 29,126 52 54,379 1,987 19,839 10,457 2,865 57,569 277 22,770 3,782 25,433 12,480 15,882 1,674 6,701 8,009 7,976 59,360 287,263 17,807 9,045 5,601 73,131 15,989 1,011,066

FIGURE 2-9 - BUDGET REPORT BASED ON ORIGINAL BUDGET

•

The distribution matrix noting when the first issue of the deliverable is due and the frequency of issue thereafter

The Project Automation Plan is approved and owned by the project manager. The Project Controls Automation Plan (a subset of the overall plan) is developed by the (on-)project controls manager and needs to be fully integrated with this overall automation plan. After determining which control elements are to be implemented, the tools can be properly selected. In selecting each component, the interrelationships must be considered so that the controls program can be optimized. Both hardware and software should be identified by work process (e.g., budget control, trending, scheduling) and by position. Hardware and software must comply with Bechtel standards, which are known as Bechtel Standard Application Programs (BSAPs). To ensure that the BSAPs will run properly, hardware selection must 2-12 55210\Construction Manua\Vol-2

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be subordinate to the application, and standard configurations must be used whenever possible. The Generic Site Automation Plan developed by Construction is an excellent reference for more specific guidance. Refer to the Construction site on the BecWeb for this document. Figures 2-10 and 2-11 provide overviews of the field (construction) controls programs. Refer to Project Controls Department Procedure 2.02 for more information on the contents and format of the Project Controls Plan and the automation tool selection process. Section 3 identifies the minimum set of control tools required on a jobsite. It is to be noted that deviations from department standards are subject to review and approval coordination by the sponsoring project controls manager, the chief cost engineer, and the chief planner. The sponsoring project controls manager is responsible for providing direction in the formulation of the structure of the project controls program during the proposal process or development phase. The key project team members should review and comment on the detailed Project Controls Plan. The sponsoring project controls manager and the project manager are responsible for reviewing and approving the detailed Project Controls Plan.

The following illustrates the basic management philosophyadpoted by Bechtel Construction Operations for the planning and control of field progress and performance:

Base Control Documents

Intermediate Schedules

Level 1

Detail Schedules

Level 2

Milestone Summary Schedule

Results Measurement

Level 3

Integrated CPM Logic Networks

Process Concrete Piping Off sites

Engineering

Procurement

90/180 Day Rolling CPM Windows/ Special Schedules

Construction/Startup

•Manual or electronic drawn •One or two pages •Statusedmonthly

•Display by month •Initially field needs dates for engrg and procurement deliverables •Defines work packages

Current Forecast

Installed Quantity Plan

Current Budget Conc CY Conduit LF

Original Budget Equipment Pipe Electrical QTYs Concrete Site

•Display by month •Weekly planned quantities for selected major commodities •Additional planning for special critical work operations •May be manpower loaded •System turnover planning

J F M A 20 40 60 80 1000 800 300 200

Level 4 Progress & Performance Table

URs

By Category

MHs &$

Progress and Performance Curves 100 o

PF 1.00

•Code of Accounts •Current budget maintained monthly •Current forecast approved by mgmt, •Ties to current financial status reports

Pour concrete fdns Inst SBI LG pipe Run PH wire/table Set compressor K10

Resource Curves

•By category and total project •Based on quantity installation curves by month •Lotus spreadsheet •Validated back to current forecast

Category

Weekly Work Plan Activity Resources Conc pump Crawler crane Scaffold Crew size

•Display at day by day level •Activity focused •Prepared byfld supvsn- Supt, GF, F, etc with support from FE and Controls •Crew oriented •Manpower loaded •Shows planned quantities •Weeklymtg for following week plan •May also include 1 or 2 week look ahead

Progress

Performance

Actual To Equipment This PF Date Week Pipe vs Actual Electrical Actual Forecast vs vs. Concrete Forecast Forecast Site •Site Mgmt review tool •Highlights - Forecast plan vs actual •Actual data also shown on P&P curves •Supported by detailgty and unit raterpts •Qty reporting and MH charging based on standard, efficient guidelines •Problems and corrective actions identified •Key reports for offsite management

FIGURE 2-10 - FIELD MANAGEMENT AND CONTROLS PROCESS

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Cost/Schedule Control Diagram - (Sub)Contract Execution (Field Perspective) Technical Scope and Scope of Services Estimate Schedule Contract Project Budget

Milestone Summary Schedule

Categories Code of Accounts

EPC Integrated Intermediate Schedule Distributables

Subcontracts Installed Quantity

Quantity Curves Weekly Work Plan

Quantities

Construction Intermediate Schedule

M/R Purchase Order Accounts Payable

Intermediate Startup Schedule

(Sub)Contract

Verify

(Sub)Contract Adminsistration

Distributables Plan and Curves

Quantity Curves

Cost and Commitment

Verify

System Punchlist

Resource Curves

S/C

Weekly Work Plan

Trends

S/C Change Orders

Forecasts

Cost

Performance Reports

Progress Reports

Daily Weekly

Reports

Critical Items Action Report

Cash Flows

Schedule

Monthly Other

FIGURE 2-11 - COST/SCHEDULE CONTROL DIAGRAM (FIELD PERSPECTIVE)

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Summary of Jobsite and (Sub)Contracts Control Tools INTRODUCTION Two BSAPs are specifically available for project control purposes. One is for schedule control, the commercially available Primavera. The other, PCWorks, covers cost control and was developed by Bechtel. Primavera is the standard critical path scheduling application used to develop fully integrated Engineering/Procurement/Construction project intermediate schedules (Level 2) and may be used for more-detailed rolling schedules at Level 3. Level 1 and Level 4 schedules are normally developed using Excel or some similar application. There are three PCWorks Modules: 1. Engineering Progress and Performance Report 2. Bechtel Services 3. Project Cost The Project Cost Module is the one that most affects field controls. The Project Cost Module contains four sections (submodules), covering General Information, Budget, Cost and Commitment, and Craft Performance, used in cost control. •

General Information is used to identify general project information, the cost code structure, the project calendar, and various sort codes for reporting purposes.

•

Budget provides the mechanisms for setting up the original budget and tracking variances via the current budget and forecast (current and trend), using a cost code breakdown structure. Labor, equipment, bulk materials, subcontracts, and other costs are presented separately in most overall project reports. Actual cost-to-date and commitment information, which is handled in Craft Performance and Cost and Commitment, is included in many project cost reports as well.

•

Cost and Commitment tracks equipment, materials, and subcontracts by purchase order and contract number. Contract values (amounts) and quantities are tracked for the allocated budget, forecast, commitments, and actuals to-date by pay item and cross-referenced to cost codes. For each contract, Cost and Commitment is capable of tracking a line-item breakdown of pay items, with roll-up to bid item and contract totals. Variance information (e.g., committed over forecast) is reported by Purchase Order/Contract number or cost code. Separate sections are provided for Contract Administration and Contract Monitoring. Under these sections, progress and performance can be statused by period (e.g., weekly) for both installed quantities and expended hours.

•

Craft Performance tracks manual labor hours and costs by cost code. Installed quantities, expended hours, and resultant unit rates are compared to budget and forecast information. Progress and performance can be statused by period (e.g., weekly). Status of manual labor earned value is provided by detail cost code breakdown in several formats. This module will not normally be used on fully contracted construction projects except possibly cost reimbursable ones or where labor broker approaches are employed. Refer to Principles of Construction Controls, Volume I for use of this control tool.

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While PCWorks provides the ability to evaluate cost at a working level and does produce related summary reports, it does not produce all the reports and graphical presentations required to implement the field controls work process. As a result, the additional reports needed are normally developed using Excel spreadsheets. In the contracts management arena, other programs have been used on some projects for detailed contract administration and monitoring. These include PICES (M&M) and Primavera’s Expedition program. In fact, Expedition is being evaluated by Contracts, and adjustments are being worked in conjunction with Primavera to match Bechtel’s specific needs. The plan is to adopt it as a BSAP for (sub)contract administration once Bechtel’s requirements are met. Further, in the contracts management arena, Bechtel relies on (sub)contractors to provide much of the information used to monitor progress at the jobsite. A large amount of direction and guidance is given in the contracts-related manuals and procedures on this and related subjects. The following are major key documents: •

Contracts/Subcontracts Formation Manual (Blue Book)

•

Contracts/Subcontracts Management Manual (Brown Book)

•

Contracts/Subcontracts Coordination Handbook

•

Contracting Guidelines No. C-1, Construction Participation in (Sub)Contract Formation

•

Prime Contract Management Manual (Red Book)

•

Corporate Policy Number 230, Procurement of Goods and Services

CONTRACT PRICING TYPES/METHODS OF PAYMENT The structure and configuration of a (sub)contract is determined by the scope of work involved. The following pricing types are used to calculate the cost. Their selection is dependent on how well developed the scope is at time of award.

Lump-Sum (Fixed Price) Contract Based on Definitive Specifications This type of (sub)contract is based on a well defined scope. Technical specifications and drawings should be essentially complete so bidders can accurately determine their costs without sizable contingencies for work that cannot be accurately estimated. Undefined scope may eventually trigger Bechtel initiated change orders.

Lump-Sum Design/Build (Engineering/Procurement/Construction) Contracts Based On Preliminary Design This type of (sub)contract is used only if the conceptual design is complete, the prime contract requires lump sum, or other factors indicate the (sub)contractor can accurately estimate cost. Typical applications include projects where: •

Schedule is key—no time for Bechtel to complete design before initiating construction.

•

The project is based on known technology.

•

Design, procurement, and construction (possibly including commissioning) are performed by a single (sub)contractor.

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Section 3

The customer’s preference is to award design/build contracts to local (sub)contractors.

Unit Price This pricing type is a form of fixed price contract that is flexible with respect to quantity changes. It is used where the type and complexity of the work is shown on the drawings, but the quantities for each unit have not been finalized. Typical applications include: •

Specialty (sub)contractors providing installation of commodities or components for the project (e.g., heating/ventilation/air conditioning, insulation, etc.) or civil work (earth moving, drilling, etc.)

•

(Sub)contractors in the international arena where direct hire is not possible or places Bechtel at a major disadvantage

The measurement for payment provisions for unit payment must be carefully written to include all related costs to complete a unit. A variation of this type of (sub)contract uses work breakdowns with applicable lump-sum values defined. Adjustments are made to cover variations in scope (e.g., quantity change) from the lump-sum subtotals using agreed-to unit prices for each item.

Cost Reimbursable This pricing type is used when contract scope definition is not fully developed; where project risks would cause (sub)contractors to include unacceptable contingencies in a fixed price; or when work conditions are such that any form of fixed price will be subject to continual change or claims. Payment is made for the actual costs incurred by the (sub)contractor for performing the work, plus a fee, which may be a fixed fee, an established target fee, an incentive fee, a fee as a percentage of cost, or a combination of the foregoing. Typical applications include: •

(Sub)contract with uncertain work scope

•

(Sub)contract work subject to many design changes (e.g., heating/ventilation/air conditioning)

•

Project conditions requiring Bechtel control of (sub)contractor's schedule and/or (sub)contractor's access to the work

•

Maintenance or major revamping of existing facilities

•

State-of-the-art or developmental projects

•

(Sub)contracts requiring continuous accelerated performance

Cost Plus Fee—Guaranteed Maximum This pricing type reimburses the (sub)contractor on the basis of cost plus a fixed or incentive fee; however, the total price cannot exceed a predetermined amount unless there is a significant increase in the scope. Thus, for the original contract scope, the (sub)contractor absorbs all of the cost overruns above the guaranteed maximum. In other words, the (sub)contract is cost reimbursable up to the guaranteed maximum. If costs exceed the guaranteed maximum, the (sub)contract is fixed price.

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Typical applications include fast-track projects where a fair degree of (sub)contractor-initiated cost control is important.

Cost Plus Fixed or Incentive Fee With Guaranteed Maximum and Shared Savings This pricing type encourages the (sub)contractor to reduce project costs. The incentive to do so is in sharing the savings below the guaranteed maximum price. Typical applications include fast-track projects where a fair degree of (sub)contractor-initiated cost control is important and where the potential for cost savings is significant.

Convertible Contracts Using this pricing type is a "two-step" arrangement that begins on a cost reimbursable or unit price basis and continues until the project is more clearly defined and drawings and specifications are fundamentally complete. At this point, based upon an agreed-to definitive estimate, the (sub)contract is converted to a fixed price arrangement. Typical applications include: •

Projects requiring a balance between minimum project duration and cost

•

Projects where customer or Bechtel and (sub)contractor have been involved in similar projects with each other and (sub)contractor performance has been exemplary

Time and Materials Contracts Using this pricing type, labor, equipment, and associated items are charged at agreed-upon rates that include factors for overhead expenses and profit. Materials are charged at cost plus a percentage markup. Time and materials contracts are used on small simple projects where the (sub)contractor is essentially a labor broker. Typical applications include: •

(Sub)contracts for repair, inspection, and related services

•

Small "quick and dirty" construction or modifications

•

Change order work in which the scope cannot be well defined at the outset

The Bechtel construction pro-forma long form contract contains provisions in the special Conditions for force account work. If mutual agreement cannot be reached on (sub)contract changes, the special condition titled "Changes" permits Bechtel to require these changes to be performed on a force account basis using the time and materials payment provisions preset in the special condition titled "Pricing of Adjustments." Force account work requires establishment of a special cost account and daily written records of the (sub)contractor's time and materials.

Bonus/Liquidated Damages Incentives Based on Time of Completion Using this pricing type, the (sub)contractor is paid an additional fee (bonus) if the facility is operationally functional ahead of schedule. If the facility is late, the (sub)contractor pays from its fee the amount agreed to in advance to compensate for all or a portion of the damages suffered 3-4 55210\Construction Manua\Vol-2

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by the customer or Bechtel due to (sub)contractor's delay. Upper limits are usually applied to both the bonus and liquidated damages (e.g., maximum of 50 percent of fee). Typical applications include projects where on-time completion is essential.

Bonus/Liquidated Damages Incentives Based on Operation and Performance Using this pricing type the (sub)contractor's fee is based on the performance factors for operation of the completed project. The extent of the bonus or penalty may be computed from product yield; raw material or utility consumption rates; separation or scrubbing efficiency; minimum effluent or by-product generation; or maintenance costs. Typical applications include projects where Bechtel desires to optimize certain predetermined production performance characteristics.

Methods of Payment The methods of payment include: •

Fixed or variable payment schedules based on milestone achieved and/or activities completed (e.g., lump sum)

•

Variable payment based on the units of work done and/or percent complete (e.g., unit price for quantities installed)

•

Variable payment based on the levels on manual labor used and costs incurred (e.g., cost reimbursable)

Table 3-1 shows the three basic (sub)contract pricing types and the factors to consider in selecting when to use each. TABLE 3-1 - FACTORS TO BE CONSIDERED IN SELECTING COMPENSATION METHOD FACTOR/METHOD

LUMP SUM

UNIT PRICE

COST REIMBURSABLE

Scope definition

Must be well defined. Target for 100% design.

Well defined, but subject to variation in quantity.

Not well defined or subject to considerable change.

Critical schedule

Acceptable, although not preferred if it is likely that contractor's work will be frequently redirected.

Not preferred. Contractor tends to do the most profitable units first, rather than critical ones.

Preferred. Higher probable cost in exchange for directing attention to the critical items.

Complex interfaces

Not preferred for same reasons as for "critical schedule."

Acceptable.

Preferred for same reasons as for "critical schedule."

Large quantities of same type of work with quantities likely to vary

Not feasible because a fixed price cannot be given for an imprecise quantity.

Preferred.

Not preferred unless an incentive contract or a target contract is used.

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FACTOR/METHOD Design by specialist contractor

LUMP SUM Preferred.

UNIT PRICE May not be suitable if quantities are determined by the contractor and Bechtel quantity confirmation is uneconomical.

COST REIMBURSABLE Preferred for "state of the art" work only.

Summary For controls requirements (sub)contract are usually considered in the context of one of the three basic pricing types: •

Lump sum

•

Unit price

•

Cost reimbursable

For instance, a time and materials contract is a form of cost reimbursable contract where preestablished cost factors are applied to the level of effort to complete the work. The noted bonus/liquidated damages incentives can effectively be applied to the three basic types. Payments over the course of the job remain consistent with the payment method selected, with the incentive adjustments occurring at job completion. Refer to Contracts/Subcontracts Formation Manual, Section 4.4.1, Contract Types by Price, for more detail about the advantages and disadvantages of each pricing type.

CONTRACT FORMATION PROCESS The contract formation process includes: • • • • • •

Planning Project Implementation Request for Proposal (RFP or Bid Package) Development Bid Period Evaluation Negotiation and Award

Planning During this phase Bechtel’s work scope is analyzed, broken down into a list of probable purchase orders and subcontracts using the Project Material Assignments Schedule (MAS), and made compatible with the Project Milestone Summary Schedule. Subcontract formation begins with the development of a preliminary Project Bidders List and gathering of departmental input for the Project Proforma (Sub)Contract Documents. Procurement will lead this process. Project Controls and Construction should be represented and active from this point forward.

Project Implementation

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Optimally, during this phase, the Project Proforma (Sub)Contract Documents and Project Bidders List are finalized by the contracts specialist assigned by Procurement. This means the (sub)contract wording has been developed to a point so that each individual (sub)contract need only become an adaptation of the project proformas for its specific work scope and bidder selection can be expedited by picking from a ready pool of pre-qualified bidders. Direction to the bidders on control process requirements should be developed at this phase to include appropriate adjustments and/or appendices to the standard proforma general and special conditions, specifications, project procedures and applicable forms. Specifications or appendices for the controls report requirements and forms should be covered. The information included should clearly display the level of detailed expected in the reports. Guidance on this is given later in this section.

Bid Package Development This phase commences with issue of a requisition for a specific (sub)contract. Unlike a Purchase Order, which originates in Engineering, the requisition is initiated by the department requiring the services. For major elements of work, it could be either Construction or Engineering. Upon receipt of the requisition, the assigned contract specialist either holds a contract formation kickoff meeting (for large complicated packages) or informally contacts department representatives to coordinate development of the RFP. Construction Contracts Administration should be represented and active from this point forward. The best way to ensure effective, minimal cost (sub)contractor reporting is to make certain reporting requirements (types of report, content, and frequency of issue) are specified in the appropriate (sub)contract documents at bid issue. This should have occurred during Project Implementation when the project proformas were developed; however, even then, some requirements may still require individual tailoring to fit each (sub)contract scope. If base data reporting requirements essential to controlling the project have been left out, a (sub)contract change at increased cost may be required to obtain the information. A key role of Project Controls is assisting in development of the Exhibit C, Form A “Schedule of Prices and Quantities.” Project Controls should participate in determining pricing breakdown to ensure it provides satisfactory control and forecasting detail, including appropriate schedule tie-in and measurement for payment requirements. Payment types may include fixed priced items, unit price items, and/or time and materials items. The bid item breakdown must be logical, easily administered and support scheduling, historical reporting requirements, and logically tied to the organization of the Exhibit D “Scope of Work” so pricing items relate to scope description. A reasonable determination that each selected (sub)contractor has the ability to submit a realistic bid for the pricing type(s) in use should be made prior to finalizing each specific (sub)contract bid list. The Exhibit “C” data request Form K “Miscellaneous Information” should include Project Controls requirements for bid evaluation data. As a minimum each bidder is asked to describe the control processes they will use. Optimally, this information should be developed during Project Implementation, in conjunction with the project proforma, and then adjusted for each (sub)contract during this Bid Package Development phase.

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As the RFP is prepared, an Evaluation Plan is developed in conjunction with the Exhibit C Data Request forms as noted above. Projects Controls must prepare the appropriate evaluation criteria for its Form K data request. Just as standard data forms have been developed, so have evaluation forms and suggested criteria. These are found on BecWeb in Group 5 of the Procurement (Sub)Contract Proformas in the Procurement Filing System (ProFiSy) or see Contracts/ Subcontracts Formation Manual, Appendix II, Attachments 2.14-A and 2-14-B for additional information.

Bid Period During the Bid Period, the contracts specialist will coordinate and process bidder questions and Bechtel’s answers, which are received and returned in writing. Irrespective of which bidder submitted the question, in order to maintain total impartiality, both the question and answer are returned to all bidders. In support of this requirement, Project Controls will, in a timely manner, provide a written response to all bidder controls questions. The Pre-Bid Meeting normally occurs about two (2) weeks after the RFP is issued. It is chaired by the contract specialist but normally held at the Jobsite and hosted by Construction. It provides an opportunity to walk the site and explain specific requirements on a direct contact basis with the bidders. Each department also participates in a discussion of the RFP and Project Controls must address schedule and resource related reporting and cover the controls specifications, appendices or general and special conditions requirements. The meeting ends with a question and answer session. Following the meeting the contract specialist will issue detailed meeting minutes based on departmental feedback. The minutes will include an answer to any question not answered during the meeting. Project Controls must provide the appropriate controls input for these minutes.

Evaluation When the bids are received, the contracts specialist chairs the bid evaluation team, using the evaluation plan as a focus for ratings and discussion. Use of the plan permits separate pricing (bid tab) and technical ratings. In this way the formalized technical rating can eliminate low priced but technically incapable bidders, establishing the lowest technically acceptable price. During Evaluation, Project Controls must review and comment on the proposed control systems submitted by each bidder. (Sub)contractors should be allowed to use established systems and processes with which they are familiar, unless the use of Primavera Expedition has been required in the (sub)contract documents. The evaluation must determine if these controls systems or the bidder’s capability to adapt to Primavera will match with Bechtel’s reporting requirements and provide adequate information to properly coordinate the (sub)contract and feed the project database. Project Controls will participate in the pricing review to ensure bid item prices are consistent with the related work scope. A comparison of bidder prices may indicate a portion of the work is ill defined, resulting in a wide disparity between bidders. To eliminate possible misinterpretation this should be explored with the bidders and, if necessary, any inaccurate drawings and specifications redone to level the bids. Specifically, attention must be given those pay items, which may be one or a combination of payment types. Keep in mind (sub)contractor monitoring may depend heavily on information supplied through pay item billings.

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Data Request Form D requires each bidder submit a preliminary (Sub)Contract Schedule. Coordinating with other departmental project leads(e.g., Construction, Engineering), Project Controls will carefully evaluate these schedules and, through the contract specialist secure bidder clarification of uncertain areas. Other Project Controls evaluation support consists of analyzing all submitted data for reasonableness with regard to execution. This includes, but is not limited to, review and analysis of (sub)contractor staffing levels over time for manual and nonmanual personnel, construction equipment scheduling, schedule durations for executing specific activities versus estimated quantities, etc. Other analyses should include, but not be limited to, extensions of unit rates, total potential cost exposure due to changes, and understanding and inclusion of interfaces where appropriate, etc. For example, care should be taken to ascertain that selected unit rates have not been inflated. This can have serious cost impacts if scope grows in these pay items.

Negotiation and Award When it is impossible to fully clarify a bidder’s proposal without discussions, bid clarification meetings are held with the low bidder or those bidders in close contention. This is done to resolve information deficiencies to the satisfaction of both parties and place the bidders pricing on a mutually understood basis. In the case of close bidders, it may be the final determinant in (sub)contractor selection. A major task of Project Controls during negotiations is to bring the selected (sub)contractor’s preliminary schedule to an acceptable status. All key schedule issues should be resolved prior to award. Once a (sub)contractor has been selected and fully approved, the contract specialist obtains any changed (sub)contracts documents from the appropriate departments and puts together the final (sub)contract. The changes may the result of the negotiations or Bechtel scope changes accepted by the (sub)contractor. If necessary, work may commence based on a Letter of Award and Notice to Proceed pending finalization of the (sub)contract documents. Once the approved (sub)contract is prepared, the contracts specialist conducts a pre-award meeting to check the updated (sub)contract documents with the selected (sub)contractor, stress key (sub)contract requirements such as bid bonds and insurance, and then get the document signed. The (sub)contractor should be able to leave with a signed agreement. The meeting is not a construction kickoff meeting, although such a meeting, conducted by contract administration, can take place after the (sub)contract is signed and the contracts specialist steps down. The contract specialist’s responsibilities conclude by printing and distributing conformed contract copies for distribution. Responsibility for the (sub)contract normally transitions to Construction at this time. The assigned field (sub)contract administrator assumes control for the execution phase.

THE CONTRACT DOCUMENTS The Proforma Family

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The Bechtel Corporate Proforma (Sub)Contract Documents family is found on the BecWeb in the Procurement Filing System (ProFiSy), Procurement Procedures and Manuals category, Proforma (Sub)Contract Documents directory. It provides a variety of (sub)contract formats which includes “short form” versions used when the work scope is uncomplicated and total contract value does not exceed prescribed monetary limits. The long form (sub)contract is used for all complex construction contracts and where the (sub)contract value exceeds US$3,000,000. The short form (sub)contract is used when the work scope is basic construction and the total (sub)contract value is below US$3,000,000. A Services Order may be used for values below US$250,000. The Contract Documents are always the same, except the short forms have reduced terms and conditions in Exhibits A and B, basic Exhibit C pricing, and basic Exhibit D scopes of work. Services (sub)contracts (e.g., Technical Services Contracts, General Services Contracts, and A&E) are not covered in this handbook because its emphasis is on executing significant construction that results in permanent facilities. Refer to the Contracts/Subcontracts Formation Manual, Section 4.5.5 for additional information on (Sub)Contract Documents and the proforma family.

Terms and Conditions Examining the long form construction (sub)contract, the following Special Conditions (SC) are the most important to (sub)contract cost and schedule control: SC-8, Commencement, Progress, and Completion of Work SC-9, Contract Schedule SC-14, Measurement for Payment SC-15, Invoicing and Payment SC-16, Pricing of Adjustments SC-8, Commencement, Progress, and Completion of Work establishes the contract milestones for the (sub)contractor's work and important supporting interfaces (e.g., utilities available) and requires the (sub)contractor to furnish the resources necessary to meet these milestones. If work falls behind schedule, Bechtel and the customer have the right to monitor progress and order the (sub)contractor to take corrective action to meet the schedule. This is a powerful and effective tool when used wisely and correctly. With proper notice and when lack of progress is due to (sub)contractor action or inaction, it permits Bechtel to direct the (sub)contractor to work overtime and/or additional shifts or add personnel at no additional expense to recover schedule. if the(sub)contractor fails to improve progress, Bechtel or the customer may declare the (sub)contractor in default and terminate the (sub)contract. SC-9, (Sub)Contract Schedule, requires the (sub)contractor to prepare an initial baseline schedule in Critical Path Method (CPM) format and to maintain this schedule based on the progress of the work. It also establishes format and frequency of periodic progress reports. An alternate clause provides for a bar chart schedule, which may be used with small (sub)contracts. SC-14 Measurement for Payment, details the manner in which the (sub)contractor is to measure its work for payment. 3-10 55210\Construction Manua\Vol-2

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SC-15, Invoicing and Payment, sets up the procedure for scheduling progress payments. It also sets forth the requirements for payment and the conditions under which payments to the (sub)contractor may be withheld. This clause will differ depending on the pricing arrangements (lump sum with progress payments, lump sum with milestone payments, unit price, cost reimbursable, etc.). SC-16, Pricing of Adjustments, is used in conjunction with the General Condition titled “CHANGES" to set forth the order of preference for pricing changes. It also contains details for payment of Force Account work, which can be directed when a negotiated price adjustment cannot be agreed or is delayed. Specific (sub)contract wording for each of these special conditions is provided on BecWeb in the Procurement Filing System’s Proforma (Sub)Contract Documents directory. There are a number of sets of both general(Exhibit A) and special(Exhibit B) condition options listed. Those under the heading “CSC Group (5)“ are the long form construction (sub)contract documents which are most used to establish (sub)contracts for permanent plant construction. These special condition clauses may be edited at project discretion to meet its requirements. During the Project Implementation and Bid Package Development phases Project Controls should review and recommend changes to these clauses as required. Attachments 3-1 and 3-2 provide some specific guidance. The proforma special condition titled “(Sub)contract Schedule” provides a listing of progress reports. This listing was designed for basic construction requirements . Attachment 3-1provides an alternate listing of progress reports that meet more rigorous (sub)contractor reporting requirements defined later in this section. Only the most complex projects would need all these reports and using the guidance in this handbook, responsible project controls personnel are able to select those which apply to specific project needs. In this manner the recommended Attachment 3-1 may be used to replace the reports specified in the proforma clause. Attachment 3-2 is supplemental to the alternate proforma special conditions titled “Measurement for Payment” which contain sample language for lump sum and unit price payment types and are found on Procurement’s BecWeb page as noted above. Attachment 3-2 provides sample language for cost reimbursable projects.

Exhibit C Data Request Forms The data request forms of Exhibit C are the primary tools for standardizing bidder proposals. When the forms are carefully selected and the information requests logically presented, each bidder will submit similarly organized packages, simplifying comparison and evaluation. These forms may be edited to fit the requirements of each (sub)contract. This is done by the appropriate project department. At the same time a complimentary evaluation plan and its tabulation sheets are updated to ensure appropriate evaluation criteria have been established for the requested information. The list of standard forms in ProFiSy is quite lengthy and may be reviewed in its entirety on BecWeb at the address noted above. The following data request forms affect cost and schedule control: 1998 Edition 55210\Construction Manua\Vol-2

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Form A, Schedule of Quantities and Prices Form B, Construction Plant and Equipment List Form D. (Sub)Contractor Schedule Form E, Personnel Tabulation Form K, Miscellaneous Information Form 0, Camp Schedule Form P, Estimated Payment Schedule Form A, Schedule Of Quantities and Prices. In the Form A format given on the BecWeb, the cost information is rolled up to summary levels. It recommended that cost for materials, manual labor and lower tier (sub) contractors be separated on this form if significant construction work is involved. This will promote an understanding of the (sub)contractor’s execution process and will provide appropriate information to gauge (sub)contractor’s progress and to clarify cost impacts for scope changes during execution. On many bids, more detailed scope breakouts are requested for pricing purposes. For example, spreadsheets separate material supply costs from installed costs (refer to Figure 2-9 for example format). This information may be incorporated in Form A to preserve the distinction between material and installation. Also, it may be made a (sub)contract provision that the (sub)contractor submit a final update of this breakdown with the final invoice. This would provide invaluable historical information. Customizing this form should be discussed with the contracts specialist during Bid Package development, but this customization is performed by Project Controls. Form D, (Sub)Contract Schedule. A narrative is a required Form D submittal. In developing the form and then at the Pre-bid Meeting, Project Controls should stress this plan, explaining it should include a breakdown of the work scope into work Items with scheduled duration and completion dates in conformance with the (Sub)Contract Milestones of the special condition titled “Commencement , Progress and Completion of the Work” and Form A pay items. For each work item the estimated direct manual jobhours required to complete the work should be provided. The plan should include the total estimated staffing (headcount) and jobhours by time period. Staffing detail is provided on Form E which segregates direct manual labor, maintenance and support labor, and supervisory labor. A percent-complete curve by time period and cumulative should be developed based on the estimated direct jobhours. Form K, Miscellaneous Information. As noted in Bid Package Development this form should include Project Controls requirements for bid evaluation data. Specifically each bidder must prepare a controls procedure outlining the following: •

The approach each will use to prepare and submit reports in accordance with the special condition titled “(Sub)Contractor Schedule.” Selected reports from the (Sub)Contract Schedule clause(having been edited, as appropriate in accordance with Attachment 3-1) should be referenced on Form K and their supporting forms from this section (Attachment 3.1.1 through 3.1.8) appended to the form. Accompanying instructions should instruct the bidders how to prepare a procedure demonstrating how they will prepare and submit each

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• • • •

Section 3

report. Caution the bidders that Bechtel schedule approval under the (Sub)Contract Schedule clause will depend on adherence to this procedure. Identify computer hardware/software and staffing commitments; Describe the control process the bidder will use, Designate an individual in the bidder’s employ who is skilled in scheduling techniques and experienced in providing scheduling and reporting requirements, whose primary responsibility will be to perform these functions, and Provide a resume of the person designated above with the Form H “Resumes of Key Personnel” submittals.

Form O, Camp Schedule. For projects requiring camps, available beds often determine the maximum number of personnel available at the site to perform the work. (Sub)Contractor’s camp requirements must be fully understood and monitored throughout the (sub)contract progress. In a camp situation, Form 0 is a required data request form. It is also noted that the proforma examples contain optional special conditions related to camp accommodations which allow for control of this situation during the execution phase. For (sub)contracts bid out of a Home Office, the (on)project controls manager participates in the development of the RFP as set forth in above, emphasizing those areas that have cost impact on the entire project. During the final project RFP review, Project Controls rechecks scope definition, general conditions, special conditions, bid pay Items, payment terms and schedules, measure for payment, technical specification, and drawing index. Deviations from budget/forecast scope and technical specifications, as well as planned scheduled dates, must be noted and, if appropriate, trended. This review is completed before the RFP package is issued for customer review and/or bid. Additionally, the field project controls manager provides a budget breakdown by bid item based on either quantities supplied by engineering or information available from the latest estimate necessary over the life of the contract.

SELECTION/ASSIGNMENT OF CONTROL TOOLS/REPORTS The requirement for information can vary considerably depending on the type of contract used and the management reporting capabilities of the selected (sub)contractors. The control tool/report requirement issues are continually addressed throughout the formation process at both prime contract and (sub)contract levels. The (sub)contractor’s capabilities in the control work process arena will reveal themselves more clearly during the (sub)contract formation phase, and adjustments to the Project Controls Plan and/or onsite staffing plan may be necessary.

Assessment of the (Sub)Contractor’s Capabilities (Sub)contractor capabilities may be initially assessed in the prime contract bid development stage. This allows appropriate Bechtel staffing levels to be reflected in Bechtel’s price to the customer. If Bechtel has worked previously in the area, historical information should be available. Otherwise, Bechtel’s regional Procurement representatives should evaluate the capabilities of the anticipated (sub)contractors and report back to those preparing the prime contract proposal. For basic construction (sub)contracts the standard Procurement pre-qualification forms are used (the forms are also found on through Procurement BecWeb home page in ProFisy). But for

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important (sub)contracts involving major facilities, such as refineries, tailored pre-qualification requirements are developed to include these key assessment areas: •

•

•

Planning

à

What levels of detail are completed in advance of mobilization?

à

To what level is resource (labor staffing, construction equipment) planning done?

à

Is actual use of resources compared over time to planned/scheduled?

à

Are development of designs and supply of materials related to planned installations of equipment and quantities?

Schedule development and monitoring

à

Are computerized or bar charts used?

à

Which computer programs are used (e.g., Primavera, Excel, Expedition)?

à

Are detailed schedules produced showing planned day-to-day activities?

à

Are planned/scheduled activities (e.g., start, durations) compared to actuals?

Progress/quantity tracking

à

Are installed commodities tracked separately?

à

Are equipment installations progressed separately?

As the bidding process proceeds, a clearer picture of each individual (sub)contractor’s capabilities will develop. The requested descriptions of their control processes and levels of commitment to supply the required reports at the requested frequency and level of detail will provide considerable insight. In addition, it is recognized that the negotiation process is the last point at which Bechtel can ensure that the contract language is clear regarding control deliverables and that the agreedupon price reflects timely submittal. Changes after this will likely involve price increases. If the (sub)contractor is incapable of providing the required level of information, then consideration needs to be given to selecting another (sub)contractor or adjusting Bechtel’s onsite staffing plans to ensure that the data are generated. Optionally, if capabilities are in doubt, a clause may be placed in the (sub)contract to allow Bechtel to assign its own personnel to assist the (sub)contractor should report requirements not be met, with the cost backcharged to the (sub)contractor. To be effectively used, the backcharge clause needs to be thoroughly understood and rigorously followed. It should be considered as a last resort only.

Selection/Assignment of (Sub)Contractor-Submitted Control Tools/Reports The following constitutes the identified minimum set of essential tools/reports: •

(Sub)Contractor CPM schedules/bar charts (monthly detail)

•

Weekly tracking of installed quantities (scheduled vs. actual) at the commodity level per the standard COA

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•

Weekly Work Plan–4-week rolling schedules (day-by-day detail) (This is preferred to 3-week look-ahead schedules because it records the as-built schedule in detail on a week-by-week basis.)

•

Daily force reports (including nonmanuals)

•

Engineering/procurement status report for design and supply of materials/equipment furnished by the (sub)contractor (including a section on overages, shortages, and damaged goods)

There are additional tools/reports that are highly recommended. They should be sought on all (sub)contracts and deferred from inclusion only if there will be considerable difficulty in getting the (sub)contractors to agree due to confidentiality. The following tools/reports are in this category: •

Weekly tracking of jobhours

•

Weekly tracking of installed quantities by detailed Weekly Work Plan activity

•

Weekly tracking of manual staffing (headcount) levels (scheduled vs. actual)

•

Weekly tracking of construction equipment utilization

•

Periodic updating of camp requirements

For a number of these tools there are alternative tracking approaches; for instance: •

•

•

Under weekly tracking of jobhours, alternatives include:

à

By work items performed

à

By commodity level per the Standard COA

Under weekly tracking of manual staffing (headcount) levels, alternatives include:

à

By category of work (e.g., concrete, steel, pipe, etc.)

à

By category of labor (e.g., pipefitters, carpenters, electricians, etc.)

à

By detailed Weekly Work Plan activity (scheduled vs. actual, placed directly on the Weekly Work Plan)

For weekly tracking of construction equipment utilization alternatives include:

à

Schedule durations (scheduled vs. actual usage)

à

Utilization (active vs. idle)

à

Assignment in support of weekly work plan activities (tracked at bottom of each page of the Weekly Work Plan)

Sometimes the contract pricing type dictates the need to employ certain tools; at other times, the circumstances affect the selection of tools/reports. The following discusses some of the issues involved. When jobhour data are given for key work, significant insight is gained about the local labor force capability. This information is particularly useful for locations where Bechtel’s intelligence is insufficient to allow more effective coordination of the (sub)contractor, regardless of the type of contract. Also, regardless of (sub)contract type, there may be a need for detailed jobhour information if the job is at a remote site, because this could directly affect Bechtel’s costs. The cost of providing transportation (e.g., planes, buses) or camp facilities (e.g., sleeping, dining, and 1998 Edition 55210\Construction Manua\Vol-2

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recreational facilities) are site population dependent and may be very expensive. On costreimbursable projects, the performance tracking may depend upon payment detail. Resource tracking of construction equipment and manual labor (e.g., headcount) supports all types of (sub)contracts during weekly reviews, but particularly cost-reimbursable (sub)contracts. The information can be quite useful in resolving disputes for any contract type because it documents the effort level put forth by the (sub)contractors. For any tool that is selected/assigned to a (sub)contractor, the level of detail to be reported must be clearly defined in the (sub)contract. To do this, it is recommended that the Standard COA be used as the guiding document. As noted in Section 2, the COA contains area-related designators (e.g., subdivision/facility) and commodity-based cost codes. It also contains a definition of work that is useful in pinning down scope on unit-price contracts. As a minimum the commodity level (e.g., 12.1, 12.2, 15.1, 16.2, etc.) should be reported on the Weekly Work Plan and installed quantity reports and there should be breakouts to the facility level for major categories of work. Certain commodities may need to go the other levels (e.g., 13.11, 14.11, 14.12) to ensure sufficient breakdown. For particularly large facilities (e.g., boilers, turbines, vessels) the breakout may need to note the detailed level/sections of the facility. The key is to have sufficient information to clearly demonstrate the status of the (sub)contractor’s work. Additional guidance on commodity level report requirements is contained in Attachment 3-1. Other factors to consider when defining the level of detail to be submitted in periodic (sub)contractor reports include: •

Customer requirements

•

Priority of work (e.g., critical path or near critical path have the highest concerns)

•

Value of work (e.g., the higher the value, the greater the need for more information)

•

Type of contract (i.e., lump sum, cost reimbursable, unit price, or combination)

•

Type(s) of work (e.g., complexity and mix of scope; permanent plant or services)

•

Bechtel’s future needs for information

Customer requirements are a part of Bechtel’s prime contract. They must be included in the reporting requirements of the (sub)contracts so that the conditions of the prime contract are met. The next three listed factors (priority of work, value of work, and type of contract) will affect the requirement for more detail application of control tools and reporting of information in a manner that can be characterized. Priority and value of work affect the need for schedule information, including status of installed quantities. The type of contract affects the reporting needs for resources (e.g., labor and construction equipment). Figure 3-1 displays a decision tree that provides guidance on determining the level of reporting detail required based on these three factors. The type of work represents a parameter (i.e., factor) that may result in some adjustment to the reporting requirements specified in the (sub)contract. Finally, Bechtel’s needs vary with the specific circumstances of the location, and requirements should be adjusted to meet those needs. Another consideration is comparison of planned/scheduled data to actuals. The most comprehensive method of display is reporting actuals and scheduled data on separate lines. This

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Section 3

(Sub)Contractor Reporting Requirements Decision Tree

Customer Mandatory Requirements?

Start

Yes

Include Customer Mandatory Submittals Requirements in Subcontract

No

(Sub)Contract Value over $250,000?

No

(Sub)Contract Value over $3 Million?

Yes No

Require Statused (Sub)Contractor Schedule & Weekly Work Plan

Fixed Price (Sub)Contract?

(Sub)Contract Work Schedule Critical? Yes

Yes

Require Statused (Sub)Contractor Schedule or Barchart & Weekly Work Plan of Key Activities

Require (Sub)Contractor Statused Barchart of Key Activities

No

Require Statused Critical Path Schedule & Detail Weekly Work Plan

No

Reimburseable Labor (Sub)Contract?

Require Detailed Installed Status Data on Critical Equipment & Quantities

Unit Rate (Sub)Contract?

No

Yes

Yes

Yes

Require Quantity Data on Key Work Items

Require Quantity Data on Key Work Items

Require Detailed Quantity Monitoring Submittals

Require Resoruce Performance Monitoring Submittals

Require Detailed Labor Monitoring Submittals

Require Resoruce Performance Monitoring Submittals

Type of Work Scope Considerations?

Yes

Adjust Reporting Requirements as Appropriate

No

Bechtel Data Needs?

Yes

Include Bechtel Requirements in Subcontract

No

Final (Sub)Contract Reporting Requirements

FIGURE 3.1 - DECISION TREE FOR (SUB)CONTRACT REPORTING

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reveals the level of the (sub)contractor’s ability to plan work effectively and meet the overall (sub)contract completion milestones. This comparison should be applied, at a minimum, to work that is critical path or near critical path.

Bechtel Control Tools A large number of tools are required to control jobsite field work effectively. The following list identifies the minimum set provided by Bechtel on most construction projects where Bechtel is leading the design and procurement efforts. Where Bechtel is not responsible for either design or procurement, the set must be tailored to Bechtel’s responsibilities and needs. •

Basis for Scope (Design Office responsible)

•

Original Budget (Design Office responsible)

•

Budget Adjustments Register (Design Office responsible)

•

Scope Change Register (Design Office responsible)

•

Current Budget (Design Office responsible)

•

Current Forecast (Design Office responsible)

•

Milestone Summary Schedule (Design Office responsible)

•

Integrated Intermediate Schedule (Design Office responsible)

•

Engineering Intermediate Schedule (Design Office responsible)

•

Construction Intermediate Schedule (including Startup) (Field responsible)

•

Systems Completion Punchlist (Field responsible)

•

System Completion Exceptions Lists (Field responsible)

•

Engineering Documents Register (Design Office responsible)

•

Material Assignment Schedule (Design Office/Field responsible)

•

Field Material Requisitions (Field responsible)

•

Field Purchase Order Register (Field responsible)

•

Buck Sheets and Other Multi-Purchase Agreements/ Procurement Tracking System/Bechtel Procurement System Reports (Design Office/Field responsible)

•

Short-Term Work Plan (Design Office responsible)

•

Critical Action Items Report (Design Office responsible)

•

Percent Complete Curves (Design Office/Field responsible)

•

Commodity Design Release Curves (Design Office responsible)

•

Commodity Installation Curves (Field responsible)

•

Backcharge Log and Process (Field responsible)

•

Cost and Commitment Program (Design Office/Field responsible)

•

(Sub)Contract Monitoring Reports (Field responsible)

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•

Subcontract Jobhour Curves (Field responsible)

•

Bechtel Distributable Manual Jobhour Curves (Field responsible)

•

Bechtel Distributable Materials Cost Graph (Field responsible)

•

Bechtel Distributable Materials Cost Report (Field responsible)

•

Bechtel Field Nonmanual Staffing Bar Chart (Field responsible)

•

Bechtel Field Nonmanual vs. Subcontract Labor Percent Curve (Field responsible)

•

Bechtel Field Nonmanual Payroll/Material Cost Graphs (Field responsible)

•

Bechtel Field Nonmanual Cost Report (Field responsible)

•

Project Data Sheet (Field responsible )

•

Trend Program (Design Office responsible)

Section 3

The following reports are the responsibility of Subcontract Administration. The latest blank versions of these tracking forms are available on the BecWeb Contracts home page. Projects using Expedition may have slightly different formats. The most important reports relating to cost and schedule are: •

(Sub)Contract Change Notice

•

Change Notice Log

•

(Sub)Contractor Proposal/Claims Log

•

(Sub)Contract Change Order

•

(Sub)Contract Amendment

•

Change Order/Amendment Log

•

Daily Summary of Time and Materials

•

Notice of Backcharge Work To Be Performed

•

Backcharge Log

•

Daily Backcharge Summary

•

Notice of Backcharge Completion

•

Daily Report

•

Invoice for Progress Payment

•

Invoice for Progress Payment/Alternate

•

Certificate of Payment

•

Invoice Concurrence Sheet

•

Daily Report of Force Account Work

•

(Sub)Contract Proposal Summary

•

Overage, Shortage, and Damage Report (Procurement)

•

Correspondence Logs

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These report forms are maintained for every (sub)contract in accordance with the Contract/ Subcontract Management Manual (Brown Book) and implementing procedures are found on the BecWeb Construction home page under Construction Works, Forms, Generic Procedures, etc.. The Period Reports Matrix for (Sub)Contract Execution shown in Figure 3-2 lists all field-issued working level and summary reports, including those by the (sub)contractors as well as Bechtel. In addition to noting the frequency of issue, the Bechtel internal distribution, and responsibility for preparation of reports are highlighted. Information on important Design Office-issued project control reports is provided in Attachment D of Project Controls Department Procedure 2.02, Project Controls Plan. Period Reports Matrix for (Sub)Contract Execution PERIOD REPORTS/FREQUENCY

CONTRACT TYPE

PROJECT DISTRIBUTION

Description Frequency

Lump Sum

Unit Price

Cost Reinbusable

Project Manager

Site Manager

(Sub)Contractors

Contracts (On)Project Manager Controls Manager

Subcontractor Schedules Installed Quantity Report By Cost Code

Monthly Weekly

YES YES

YES YES

YES YES

C C

C C

C C

Weekly Work Plan (4-Week Rolling Schedule)

Weekly

YES

YES

YES

O

O

C

Daily

YES

YES

YES

A

C

O

Field Controls Manager C C

C

C

C

Force Reports Engineering/Procurement Status Report(If Responsible) Manhour Report

Weekly

YES

YES

YES

C

C

Weekly

RECOMMENED

RECOMMENED

YES

A

C

C

Manual Personnel(Headcount) Staffing Report

Weekly

RECOMMENED

RECOMMENED

YES

A

C

C

Construction Equipment Schedule/Utilization Reports(Optional) Camp Requirements(If Bechtel impacted) 3/6-Month Rolling Schedules(Optional) Payment Plan Status Report Installed Quanitity Report By Pay Item

Weekly

RECOMMENED

RECOMMENED

YES

A

C

C

Monthly Monthly Monthly Monthly

YES OPTIONAL YES OPTIONAL

YES OPTIONAL YES YES

YES OPTIONAL YES OPTIONAL

C C A A

C C C C

C C C C

Daily Monthly Monthly

YES YES YES

YES YES YES

YES YES YES

A C C

X X X

C C

C C C

Monthly

YES

YES

YES

C

X

C

C

Monthly Monthly Weekly

YES YES YES

YES YES YES

YES YES YES

C C C

X X C

C C

C C C

Construction Intermediate Schedule Cost & Commitment Reports Subcontract Monitoring Reports Bulk Commodity Installation Curves (Total Project) Subcontract Field Staffing /Hour Graph (Sub)Contact & Bechtel Distrib Manual Jobhour Graph System Completion Punchlists System Completion Exceptions List Distributable Material Cost Report Field Nonmanual Bar Chart Field Nonmanual Cost Report Field Nonmanual Staffing/Jobhour Graphs

Monthly Monthly Monthly

YES YES YES

YES YES YES

YES YES YES

O O

O O C

C C C

O X C

Monthly

YES

YES

YES

C

C

C

Monthly

OPTIONAL

OPTIONAL

YES

C

C

C

Monthly

A

A

A

C

Weekly Weekly Monthly Monthly Monthly Monthly

YES YES A YES YES YES

YES YES A YES YES YES

YES YES A YES YES YES

C C

Field Nonmanual Payroll/Material Cost Graphs

Monthly

YES

YES

Quarterly

OPTIONAL

OPTIONAL

C

Field Construction Business Line EngineeringCoordinator & Manager Manager Management

Regional Office Controls Management

O

C

Bechtel Contracts Administration/Coordination Daily Reports (Sub)Contractor Change Notice Log (Sub)Contactor Proposal/Claims Log (Sub)Contractor Change Order/Amendment Log (Sub)Contract Proposal Summary Backcharge Log Action Items Lists

C

C

X

C

Critical List only (issued from home office)

X C X

C

O C C

C

X

C

C

C

C

X

C

C

C

C

C

X

C

C

C

C C

C

C C C X O C

C C

X X X O X X

YES

C

C

C

OPTIONAL

A

C

C

Bechtel Field Project Controls

Project Data Sheet (Optional)

Legend A: As Required C: Recipient of Copy of Document

C C

Summary Report as required

C

C C C C C

C

C

X

C

C

C

X

C

A

A

O: Recipient of Original of Document X: Issuer of Document

FIGURE 3-2 - REPORTS DISTRIBUTION MATRIX

RESPONSIBILITIES (Sub)Contractor. The (sub)contractors responsibilities are defined in the contract. As noted earlier, a (sub)contractor controls procedure, enforceable under the contract should be required from the (sub)contractor. This procedure should include commitments on the timing and content of the related deliverables and the resource commitments to meet their procedural requirements. The updating of all progress documents shall be consistent and timely. The standard proforma special 3-20 55210\Construction Manua\Vol-2

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Section 3

condition titled “INVOICING AND PAYMENT” allows for payments to be withheld if schedules as defined in the special condition titled “SUBCONTRACT SCHEDULE have not been submitted. This does not cover the supporting reports listed in that clause and full payment should not be withheld for failure to submit one or more of these reports unless it can be shown it has a direct effect on the actual work performance. Appropriate partial withholding may be applied if fairly calculated. As part of the controls procedure to be submitted by each bidder with Exhibit C, data request Form K, the (sub)contractor should have designated an individual in its employ who is skilled in scheduling techniques and experienced in providing the aforementioned scheduling and reporting requirements, and whose primary responsibility will be to perform these functions. This name should be listed in the special condition titled “Key Personnel,” which Project Controls should request the contact specialist include in Exhibit B. In the event that the (sub)contractor’s personnel are unable to perform these functions, Bechtel shall offer to provide an individual to the (sub)contractor who will perform such functions and whose costs will be backcharged to (sub)contractor. The proposal will be made pursuant to the proforma general condition titled “BACKCHARGES” as a correction of nonconforming work. Once the (sub)contractor is so notified and a reasonable time elapses and by its action indicates that it is unable or unwilling to proceed, Bechtel may terminate the contract under general condition titled “Termination for Default”. Bechtel may not supply a replacement from its own staff without the (sub)contractor’s affirmative concurrence.

Bechtel Assigning and communicating the functional responsibilities for each (sub)contract is facilitated by completing the Contract Division of Responsibility Matrix. The generic version of this matrix is provided in Appendix D. The Bechtel project manager or Bechtel site manager, depending on the management structure of the project, assigns contract management functions among the field staff (by name not title) and review the division of responsibility with each employee who has been assigned a functional responsibility. Copies of the completed Contract Division of Responsibility matrices indicating assignments will be distributed to those involved in the project’s (sub)contracts management. The two primary field functions assigned for each (sub)contract are: •

Contracts Administration

•

Contract Coordination

The contract administrator has primary responsibility for (sub)contract administration on the project. The emphasis is on the commercial aspects of the process. Some of the primary responsibilities of the contract administrator include: •

Read, understand, and implement the full (sub)contract on behalf of Bechtel

•

Provide and receive contractually required notices

•

Obtain a detailed and reasonable schedule from the (sub)contractor at the start of the job describing how the work will be performed

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•

Obtain periodic revised schedules from the contractor that accurately reflect job progress and any requests for additional time

•

Monitor (sub)contract progress and maintain records of performance if a (sub)contract extra is submitted for cost overruns

•

Ensure that the contractor does not assume responsibility for work outside the scope of the (sub)contract without proper authorization, since this could lead to a (sub)contact extra (i.e., change)

Contract coordinators are involved with the technical aspects of the (sub)contract, as well as the schedule. Contract coordinators are typically recruited from the ranks of Field Engineering, Subcontract Administration, Project Controls, and field supervision and receive specific training on required coordination methods. Typical contract coordinator responsibilities include: •

Monitoring (sub)contractor work progress

•

Preparing the daily report

•

Inspecting (sub)contractor work quality

•

Validating (sub)contractor progress payments

•

Monitoring (sub)contractor daily force reports

•

Coordinating (sub)contractor activities on the project

Project Controls must maintain continuous coordination with these key personnel and, as required, coordination with others on the matrix. Refer to Appendix D, Contract Division of Responsibility Matrix, and other sections of this handbook where additional information on project team interfaces is given.

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Section 3

ATTACHMENT 3-1

(SUB)CONTRACTOR SCHEDULING & REPORTING REQUIREMENTS During the performance of the Work, SUBCONTRACTOR shall submit to CONTRACTOR periodic progress reports on the actual progress. Such reports shall be provided in form and format directed by CONTRACTOR and include the following: 1. Monthly–

A copy of the Subcontract Schedule showing actual progress to date for the major parts of the Work, as compared to planned progress [ Note: This report is required].

2. Weekly–

A weekly report of project quantities installed by SUBCONTRACTOR, showing actual versus scheduled weekly installed totals for commodity level cost codes selected by CONTRACTOR. The initial submittal of this report shall coincide with submittal of the Subcontract Schedule for approval. [Note: This report is required. Also, it is best to list the selected quantities in this section and ensure that the price covers the work to provide data. See related attachment for cost code list of possible candidates for quantity tracking, See Attachment 3-1.1].

3. Weekly–

Weekly Work Plan—A rolling 4-week schedule showing one (1) week of actual progress and a three (3)-week look-ahead forecast of detailed work activities. The day-to-day progress shall be compared with the day-to-day planned work by activity. Variations will be noted and rationalized. [Note: These reports are required, see Attachment 3-1.2] Each activity related to items of Work noted in 2 above shall show scheduled installed quantities by week for all weeks (including the forecast) on the 4-week rolling schedule. Actual installed quantities for these items of Work will be noted for each activity worked during the week [Note: Italicized text is recommended, see Attachment 3-1.3 for example approach to be taken.]

4. Daily–

A daily force report listing all personnel (including office and supervisory nonmanual) by craft and work assignment. The force report specifies the number of persons actually engaged on work during the reporting period, with such total stated separately as to maintenance and support, supervisory, and manual personnel, including numbers of national citizens, thirdworld country, and expatriate employees. Manual personnel shall be noted by skill or craft. [Note: This report is required, see Attachment 3-1.4]

5. Weekly–

A procurement status report for all materials provided by SUBCONTRACTOR included in its scope. [Note: This report is required where applicable. See Attachments 3-1.2 and 31.3 which allow for input on the status of design drawings and materials deliveries supporting the identified installation Work.]

6. Weekly–

Tracking of actual jobhours either by Work items or by commodity level cost codes selected by CONTRACTOR, and comparing actual to planned jobhours. Variations from approved plans shall be noted and rationalized. The initial submittal of this report shall coincide with the submittal of the Subcontract Schedule for approval. [Note: This report is recommended, see Attachment 3-1.5]

7. Weekly–

Tracking of manual labor staffing (headcount) either by Work Area or Labor Craft as specified by CONTRACTOR, showing both planned and actual numbers on a day-by-day basis. The Staffing Tabulation Chart is updated weekly for the succeeding thirty (30) calendar days, stating the total number of manual, supervisory, and lower-tier subcontractor personnel working on the subcontract. [Note; on international projects the numbers of national citizens, third-world country, and expatriate employees may need to be in separate categories.] The initial submittal of this report shall coincide with the submittal of the Subcontract Schedule for approval. [Note: This report is recommended, see Attachment 3-1.5]

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Section 3

Summary of Jobsite & (Sub)Contracts Control Tools

ATTACHMENT 3-1 (CONTINUED) 8. Weekly–

Tracking of construction equipment used in the work on a day-to-day basis, using a 4-week rolling schedule approach. [Note: This report is recommended, use either a separate spreadsheet, Attachment 3-1.7, or place data at the bottom of each page of the Weekly Work Plan, Attachment 3-1.3) Weekly Equipment Report listing all construction equipment on the site during the reporting period, specifying equipment used in the work and equipment idle. The initial submittal of this report shall coincide with the submittal of the Subcontract Schedule for approval. [Note: This report is optional, see Attachment 3-1.8]

9. Monthly–

A rolling 3-month schedule showing 1 month actual progress and a 2-month look-ahead forecast of detailed work activities on a week-by-week basis. The week-by-week progress shall be compared with the week-by-week planned work by activity. Variations will be noted and rationalized. [ Note; This schedule is optional].

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Section 3

Attachment 3-1.1

QUANTITY CONTRACT NO: CONTRACTOR:

PAY ITEM

Date:

COST CODE

DESCRIPTION

UNIT

Contract

Forecast

This Week

To Date

(Including Number) S A S A S A S A S A S A S A S A S A S A S A S A S A S A

11.44 11.45

GRADING & SITE WORK Clear & Grub Strip Rough grade Final Grade Slope Protection STRUCTURAL EARTHWORK Structural Excavation Structural Backfill Rock Excavation Final grade Trenching Fillcrete/Flowable Fill Erosion Control Pre-loading for Compaction Mass Excavation Mass Fill Mass Compaction Rough Grading Blasting in Rock PILES & CAISSONS Test Piles On & Off Bearing Piles Sheet Piling - Permanent Piling Temporary Caissons Permanent

11.8

RAILROAD TRACK(W/BALLAST)

11.21 11.22 11.23 11.24 11.31 11.32 11.33 11.34 11.35 11.36 11.37 11.38 11.391 11.392 11.393 11.394 11.395 11.41 11.42 11.43

AC/HC CY/CM

12.1 12.2

SY/SM SY/SM

12.3 12.4

CY/CM CY/CM

12.61

CY/CM

12.62

SY/SM

12.63

CY/CM

12.64

CY/CM CY/CM

12.65 12.66

CY/CM

12.7

CY/CM

12.71

CY/CM CY/CM

12.72 12.8

12.5

11.91 11.92 11.93 11.94 11.95 11.96 11.97

1998 Edition 55210\Construction Manua\Vol-2

SF/SM SF/SM TN/MT LB/KG CY/CM CY/CM CY/CM CY/CM EA EA CY/CM SF/SM SF/SM EA

CY/CM

LF/LM

13.41

EA

13.42

STEEL FRAMING & EQUIPMENT SUPPORTS Fabricated Steel Field Fabricated Steel OFFSHORE PLATFORM Jacket Deck Subsea Structure PLATFORM & MISCELLANEOUS STEEL Walkway & Platforms Grating Stair Treads Checkered Plate Handrail & Toeplate Ladders & Safety Cages OTHER STEEL RELATED Steel Pipe Stanchions Steel Pipe Sleepers

13.5

LINER PLATE

CY/CM LF/LM

13.11 13.12

LF/LM SF/SM

13.21

EA LF/LM

13.22 13.23

LF/LM

13.31 13.32

LANDSCAPING, FENCING & ROADS Landscaping Fences & Gates Paved Surfaces Unpaved Surfaces Guard Rails & Dividers Marking, Signs, Flag Post Etc. Guard Post

CONCRETE RELATED FORMWORK METAL DECKING REINFORCING STEEL EMBEDS CONCRETE OTHER CONCRETE Mudmat Tremie concrete Ductbanks Catch Basins Manholes Miscellaneous Concrete CONCRETE SPECIALTIES Waterproofing Welded Wire Fabric for Slabs PRECAST CONCRETE

13.33 LOT

13.34

LF/LM

13.35

SY/SM

13.36

SY/SM

TN/MT TN/MT TN/MT TN/MT TN/MT TN/MT SF/SM EA SF/SM LF/LM LF/LM TN/MT TN/MT

EA

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

SF/SM

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Section 3

Summary of Jobsite & (Sub)Contracts Control Tools

Attachment 3-1.1 (Continued)

14.11 14.12 14.13 14.14 14.21 14.22 14.23 14.24 14.25 14.26 14.41 14.42 14.43 14.44 14.45 14.46 14.47 14.48 15.11 15.12 15.13 15.14 15.15 15.16 15.2 15.3 15.4 15.5 15.6 15.7

21.1 21.2 21.3 21.4 21.5 21.9 22.1 22.2 22.3 22.4 22.5 22.6 22.7 22.9 23.1 232 23.3 23.4 23.5 23.7 23.8 23.9 24.1 24.2 24.3 24.9 25.1 25.2 25.3 25.4 25.6 25.7 25.8 25.9

THERMAL & MOISTURE PROTECTION Siding Roofing Doors Windows & Glazing MASONRY Concrete Masonry Block Walls Nonloadbear Concrete Masonry Block Walls Loadbearing Brick Walls Restoring & Cleaning Stonework Glass Block Walls ARCHITECTURAL FINISHES Partitions - Lath & Plaster Partitions - Drywall, Metal Studs Wall Finish - Lath & Plaster Wall Finish Acoustical Ceiling Finish - Lath & Plaster Ceiling Finish - Acoustical Special Finishes Plumbing Equipment FIELD FABRICATE PIPING < 2 1/2"Pipe 2 1/2" - 8" Pipe 10" - 16" Pipe 18" - 30" Pipe > 30" Pipe Large Hangers INSTALL SMALL PIPE & HANGERS < 2-1/2" INSTALL LARGE PIPE 2-1/2" - 8" INSTALL LARGE PIPE 10" - 16" INSTALL LARGE PIPE 18" - 30" INSTALL LARGE PIPE > 30" INSTALL LARGE PIPE HANGER & SUPPORTS

CENTRIFUGAL PUMPS W/DRIVERS RECIPROCATING PUMPS W/DRIVERS INJECTION & PROPORTIONING PUMPS TURBINE DRIVER ONLY MOTOR DRIVER ONLY REFURBISH PUMPS & DRIVERS CENTRIFUGAL COMPRESSORS W/DRIVERS CENTRIFUGAL COMPRESSORS W/TURBINES RECIPROCATING COMPRESSORS W/MOTORS RECIPROCATING COMPRESSORS W/TURBINES BLOWERS, FANS W/DRIVERS DRIVERS FOR COMPRESSORS HYDRAULIC TURBINES, REDUCTION GEARS REFURBISH COMPRESSORS SHELL & TUBE EXCHANGERS AIR COOLED EXCHANGERS COOLING TOWERS CONDENSERS PLATE & FRAME EXCHANGERS, PLATE COILS EVAPORATORS OTHER HEAT EXCHANGER REFURBISH HEAT EXCHANGERS SHOP FABRICATE TANKS FIELD ERECT TANKS BINS, HOPPERS, CHUTES, GATES & SILOS REFURBISH TANKS CONVEYORS FEEDERS SCREEN, GRIZZLY TROMEL CRUSHER MILLS DUST COLLECTION CYCLONES, FILTERS DUCTWORK & EXPANSION JOINTS UNLOADING & STACKING OTHER MATERIAL HANDLING EQUIPMENT

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16.1 SF/SM

16.2

SF/SM

16.3

EA

16.4

SF/SM

16.5 16.6

SF/SM

16.7

SF/SM SF/SM

17.11

SF/SM

17.12

SF/SM

17.21

SF/SM

17.22 17.3

SF/SM

17.51

SF/SM

17.52

SF/SM

17.61

SF/SM

17.62

SF/SM

17.63

SF/SM

17.64

SF/SM

17.65

EA

17.66 17.67

LF/LM

18.1

LF/LM

18.18

LF/LM LF/LM

18.21

LF/LM

18.22

EA

18.23

LF/LM

18.3

LF/LM

18.4

LF/LM

18.5

CABLE TRAY/RACK, CHANNEL & FITTINGS SCHEDULED CONDUIT & SUPPORTS UNSCHEDULED CONDUIT & SUPPORTS SCHEDULED WIRE & CABLE SCHEDULED CONNECTION & SPLICES UNSCHEDULED WIRE & CABLE CONN. OVERHEAD POLE LINE DISTRIBUTION INSTRUMENTATION Instrument Rack Instrument Enclosures Panel Mounted Instruments Field Mounted Instruments TUBING RACEWAY & SUPPORTS Main Control Panels Analyzer/ Sampling Systems Distributed Control Burner management Programmable Logic Controllers Multiplexers Supervisory Control & Data Acquisition Emergency Shutdown Boiler Control System PAINTING & COATINGS Tank Special Coatings FIREPROOFING Structural steel Cable tray Equipment EQUIPMENT INSULATION PIPING INSULATION INSTRUMENTATION INSULATION

LF/LM LF/LM LF/LM LF/LM EA LF/LM LF/LM EA EA EA EA LF/LM EA EA EA EA EA EA EA EA EA SF/SM SF/SM CY/CM LF/LM SF/SM EF/EM EF/EM EF/EM

LF/LM LF/LM EA

EA

26.1

EA

26.2

EA

26.3

EA

26.4

EA

26.5

EA

26.6

EA

26.7

EA

26.9

EA

27.1

EA

27.2

EA

27.3

EA

27.4

EA

27.5

EA

27.6

EA

27.7

EA

27.8

EA

27.9

EA

28.1

EA

28.2

EA

28.3

EA

28.41

EA

28.42

POTABLE WATER TREATMENT RAW WATER TREATMENT MAKE-UP CONDENSATE DEMINERALIZERS WASTE WATER TREATMENT CHEMICAL FEED MISC. PURIFICATION & FILTRATION WATER DESALINATION REFURBISH WATER TREATMENT PACKAGED UNITS & MODULES PHYSICAL PROCESSING EQUIPMENT VACUUM EJECTORS CATALYST AND CHEMICALS HVAC EQUIPMENT & DUCTWORK ELEVATORS & LIFTS STACKS, FLARES & CHIMNEYS SPECIALIZED MOBILE AND SHOP EQUIP REFURBISH OTHER EQUIPMENT TRANSFORMERS BUS DUCT AND SUPPORTS MEDIUM VOLTAGE POWER DISTRIBUTION METAL CLAD SWITCHGEAR MOTOR CONTROL CENTERS

EA EA EA EA EA EA EA EA EA EA EA EA EA EA EA EA EA EA LF/LM EA EA EA

EA EA

28.5

TN/MT

28.61

EA

28.62

EA

28.7

EA

28.8

EA

28.91

EA

28.92

EA

28.93

TN/MT

28.94

TN/MT

28.95

DC & EMERGENCY Relay Panels Other Misc. Elect Devices LIGHTING SYSTEMS HEAT TRACING Cathodic Protection Communication Fire & Smoke Detection Plant Security Prefabricated Electrical Modules

EA EA EA EA EA EA EA EA EA EA

EA

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Summary of Jobsite & (Sub)Contracts Control Tools

Section 3

Attachment 3-1.2 WEEKLY WORK PLAN

CONTRACT NO:

JOB NO.

CONTRACTOR:

WEEK NO.

BY APPVD

ISSUE DATE

PAGE

OF

MEETING DATE C

COST

SCHED

CODE

REF

R

LAST WEEK DESCRIPTION

M

T

W

T

dd F

S

THIS WEEK

S

M

T

W

T

dd F

S

S

NEXT WEEK M

T

W

T

dd F

S

S

WEEK AFTER NEXT M

T

W

T

F

S

dd

D M

S

W T

I

G

R

T

S

L

REMARKS

S A S A S A S A S A S A S A S A S A S A S A S A S A S A

Attachment 3-1.3 WEEKLY WORK PLAN

CONTRACT NO: CONTRACTOR:

BY APPVD

PAGE

OF

MEETING DATE C

COST

JOB NO. WEEK NO.

ISSUE DATE

SCHED R

CODE

REF

LAST WEEK DESCRIPTION

M

T

W

T

dd F

I T

S

THIS WEEK

S WK-

M

T

W

T

dd F

S

NEXT WEEK

S WK-

M

T

W

T

dd F

S

WEEK AFTER NEXT

S WK-

M

T

W

T

F

dd S

S

D M WK-

W T

LY

LY

LY

LY

G R

QTY

QTY

QTY

QTY

S

REMARKS

L

S A S A S A S A S A S A S A S A S A S A S A S A S A S A LEGEND

TOTAL MEN

* - CRITICAL

E

S - SCHEDULE

Q

A - ACTUAL

P

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

WITH ADDED QUANTITY/ RESOURCE TRACKING

T

1998 Edition 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

3-27

Section 3

Summary of Jobsite & (Sub)Contracts Control Tools

Attachment 3-1.4 PROJECT ( ) DAILY FORCE REPORT Contract No:_________________ Contractor:___________________

Colunm Number

Report Date __________ (End of Day Shift)

1

2

3

4

5

6

7

DIRECT MANUAL

Total Total

(-)

(+)

Payroll

(-)

(-)

Total

Staff on

Apprentice

Payroll

Terminations

Total Hires

Force

Absent

Rotation

Working

Order

(included)

expended

Force Last

Since Last

Since Last

Today

Today

Today

Column

in

Since Last

Report

Report

Report

Col.s 1+2+3

Column 4

Report

Total Johours

Boilermaker/Welder Brick/Bricklayers Carpeters/Formworkers Cladder Concrete Worker/Cement Masons Dogman Drillers Electrical Lineman Electricians Electrical Trade Assistants Elevator Equipment Operators Fitters - Mechanical/Pipe Insulators Iron Workers Laborers Mechanical Trade Assistants Millwrights Operating Engineers Painters Plumbers/Drainers Powder Monkeys Riggers Roofers Sheet Metal Sprinkler Fitters Steel Fixers Truck Drivers

INDIRECT MANUAL

Total Direct Manual Building Maintenace Trademan Chainmen Cleaners/Laborers Cooks Equipment Greasers/ T A s Kitchen Hands Truck / Bus Drivers Warehouseman

NONMANUAL

Total Indirect Manual Administrtion & Accounting Cost Engineers/Planinng & Scheduling Engineers & Survey Management Procurement Safety & First Aid Startup Surpervision

Total Nonmanual Direct Manaul Jobhours Available

Available - Rain - Industrial - Pubic Holidays - Other

Total Expended

3-28 55210\Construction Manua\Vol-2

Indirect Manual Jobhours

- Rain - Industrial - Pubic Holidays - Other Total Expended

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Summary of Jobsite & (Sub)Contracts Control Tools

Section 3

Attachment 3-1.5 JO B H O U R R EP O R T CONTRACT NO: CONTRACTO R:

P A Y IT E M

D a te :

COST CODE

D E S C R IP T IO N

U N IT

C o n tra c t

F o re c a s t

T h is W e e k

T o D a te

(In c lu d in g N u m b e r) S A S A S A S A S A S A S A S A S A S A S A S A S A S A

Attachment 3-1.6 ST AFFIN G T ABU LAT IO N C H A R T C O N TR AC T N O : ______ ______ _______ ___ C O N TR AC T O R :__ ______ _______ _______ __

D ate:

W E E K /M ON T H M o n th 4

W O R K A R E A /LA B O R G R O U P

M o n th 1 C A TE G O R Y

1

2

3

M o n th 2 4

1

2

3

M o n th 3 4

1

2

3

4

1

2

3

M o n th 5 4

1

2

3

M o n th 6 4

1

2

3

M o n th 7 4

1

2

3

4

T otal

S A S A S A S A S A S A S A S A S A

S u p p o rt & M a in ten a n c e

S A

TO TA L M A N U A L

S A

No n m an u a l S u p erv iso rs

S A

F ie ld En g in ee rs & S u rv e y

S A

Co s t/Sch e d u le En g in ee rs

S A

Ad m in & A cc o u n tin g

S A

Sa fte y & First A id

S A

P ro cu re m e n t

S A

M a n a g em e n t

S A

TO T A L

S A

NO T E: Staffin g to re p re s en t a ve rag e fo r p e rio d

1998 Edition 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

3-29

Section 3

Summary of Jobsite & (Sub)Contracts Control Tools

Attachment 3-1.7 CONSTRUCTION EQUIPMENT SCHEDULE CONTRACT NO: CONTRACTOR:________________________

Date:

WEEK/MONTH Month 4

EQUIPMENT

Month 1 CATEGORY 150 T CRAWLWER

1

2

3

Month 2 4

1

2

3

Month 3 4

1

2

3

4

1

2

3

Month 5 4

1

2

3

Month 6 4

1

2

3

Month 7 4

1

2

3

4

Total

S A

75 TRUCK CRANE

S

15 T HYDRO CRANE

S

A A FORK LIFT

S

CONCRETE PUMP

S

A A WELDING MACHINES

S

PIPE BENDER

S

A A ETC.

S A S A S A S A S A S A S A S A S A

3-30 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Summary of Jobsite & (Sub)Contracts Control Tools

Section 3

Attachment 3-1.8 PROJECT ( ) WEEKLY EQUIPMENT REPORT Contract No:_________________ Contractor:___________________

No. of Vehicles & Machines

Total Equipment Hours Description (Make/Model/Capcity

Working M

T

W

T

F

Idle S

S

M

T

W

T

F

S

S

Air Track Backhoe - Tracked Batch Plant Bus - Personnel Carriers Compactors Concrete Mixers Concrete Pumps Concrete - Transit Mixer Conveyors Cranes - 8-20 Ton - 20-50 Ton - 50-150 Ton - Tower Crushing Plant Dozers Drag Lines Drilling Rigs Dump Trucks - Off Highway Fans Fork Lift Front End Loaders Generators Graders Lifts (personnel) Motor Cycles Pile Driver Pumps Rollers - Rubber Tire - Sheeps Foot - Smooth Scrapers Tractor - Rubber Tire Trailer - Semi - Low Boy Trencher Truck - Light - Flatbed - Dump - Fire - Water - Fuel - Service - Van - Prime Mover Vehicles - Sedans, Utilitie - Wagons, 4-wheel Drive Welding Machines - Electric - Diesel Winches

1998 Edition 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

3-31

Section 3

Summary of Jobsite & (Sub)Contracts Control Tools

ATTACHMENT 3-2

RECOMMENDED CONTRACT LANGUAGE TO COVER CONTRACT PAYMENT REQUIREMENTS UNDER COST REIMBURSABLE (SUB)CONTRACTS Special condition titled “Measurement for Payment” SUBCONTRACTOR shall within ten (10) calendar days after subcontract award provide a projected subcontract cost breakdown based on Exhibit D “Scope of Work.” The breakdown shall show material cost, labor cost, and lower tier subcontractor cost separately for each item. SUBCONTRACTOR shall provide the same breakdown with respect to the adjusted compensation with SUBCONTRACTOR’s final invoice. CONTRACTOR shall review SUBCONTRACTOR’S subcontract cost breakdown and advise SUBCONTRACTOR in writing of required refinements. Also within ten (10) calendar days after subcontract award, SUBCONTRACTOR shall provide a schedule of monthly payments (Estimated Payment Schedule) required to perform the Work in accordance with the Subcontract Schedule submitted pursuant to Special Condition titled “SUBCONTRACTOR SCHEDULE.” It will relate to the expenditure of jobhours anticipated to complete each task, as well as magnitude and timing of other expenditures to support the Work. The submittal shall contain separate commitment and expenditure forecasts for each currency and shall be updated monthly. Reports shall be in both tabular and graphical formats. SUBCONTRACTOR shall submit verified time sheets, materials invoices, construction equipment rental costs, lower tier subcontractor costs, and CONTRACTOR-approved equipment lists with the invoice. SUBCONTRACTOR shall identify the progress completed and shall verify the reported progress to CONTRACTOR, based on a joint walkdown. Marked up drawings may be used as a supplemental method of documenting progress. Copies of field notes, computations, and other records made by SUBCONTRACTOR for the purpose of determining progress shall be furnished to CONTRACTOR upon request.

Special condition titled “Invoicing and Payment” Written estimates shall be prepared by SUBCONTRACTOR for CONTRACTOR’S approval ten (10) calendar days before invoicing, covering the amount and value of work satisfactorily performed by SUBCONTRACTOR up to the date of the estimate. Such estimates shall not include materials or equipment not incorporated into the Work. CONTRACTOR will review the estimates with SUBCONTRACTOR and, upon approval, return the estimates for submittal with SUBCONTRACTOR’S invoice.

3-32 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Section 4

Project Summary Reports This section covers the following reporting processes and related reports, including guidelines on field involvement: •

Project Progress Reporting

•

Project Financial Reporting

•

Project Data Sheet

•

Milestone Summary Schedule (Level 1)

•

Field Progress and Resource Curves

The report examples included represent standard formats for presenting overall project status and performance, particularly as related to the prime contract. The term standard refers to the contents of the sample reports and the general arrangement. Whether or not PCWorks is used, automation should be used to its fullest extent to assemble summary level information as it exists in other databases or control systems. When complete automation is not possible, a primary source database should be identified to sponsor the report. Open or blank fields should be provided for manual entry of data from other systems.

PROJECT PROGRESS REPORTING At the beginning of the project, the project manager establishes with the client the outline for the Progress Report, in accordance with the contractual requirements and/or Bechtel needs. Depending on the scope of the project, contract type, and client requirements, the Progress Report may differ in the level of detail from that sent to Bechtel management, where additional confidential information will be added. The project manager also establishes a calendar for submittal of progress report input from various team members for project manager review, approval, and incorporation into the report. The report is issued no later than the tenth of each month. In the past, separate monthly construction progress reports were developed. In the interest of TIC and efficiency, field progress reporting is limited to providing input to the overall monthly project report. For field-related items, the overall report may typically contain: •

Construction Status, including: à

Summary narrative of construction progress identifying significant activities during the report period

à

Detailed list of construction activities completed during the reporting period

à

List of major and/or critical activities under progress during the report period (These activities are reported through completion.)

à

List of significant activities scheduled for the following month

à

Graphical display of bulk commodity installation

à

Graphical display of equipment utilization and down time (heavy civil projects)

à

Areas of concern deserving/requiring management attention

1998 Bechtel Corp. 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

4-1

Section 4

•

•

•

à

Tabular summary of field forces at the end of the reporting period, by Bechtel nonmanual, Bechtel manual (if any), major Bechtel subcontractor, and other subcontractors

à

List of site visitors (optional)

Startup Summary, including: à

Summary narrative of significant startup activities for the reporting period, including actual percent complete versus scheduled

à

List of startup activities by system for the reporting period (Activities shown in progress are reported through completion.)

à

Activities scheduled for the following month

à

Status of system turnover indicating actual number versus scheduled for the reporting period and through the reporting period (Total number of systems is also indicated.)

à

Areas of concern deserving/requiring management attention

Safety Summary, including: à

Tabular display of total craft hours worked, recorded injuries, and time lost due to accidents (This information is for the current month and inception to date.)

à

Narrative describing any significant injury/accident during the reporting period

Meetings à

•

Project Summary Reports

List of project meetings held during the reporting period, indicating date, meeting subject, location, and companies attending (optional)

Appendices à

Milestone Summary Schedule

à

Critical Items Action Report (CIAR)

à

Scope Change Register

à

Owner-Bechtel Action Items List

à

Trend Report (if cost reimbursable)

à

Progress photos

Even though most of the items listed as Progress Report appendices are controlled in the Home Office, they are shown here because they involve significant supporting input from the field. For example, the field maintains the list of action items that are shown in other sections of this handbook. These lists feed into the overall project CIAR maintained by the project planner in the Home Office. The CIAR review is held weekly and may involve a phone conference to ensure proper interface with the field. The sample project CIAR format is shown in Figure 4-1. A process flow chart for critical item reporting is shown in Figure 4-2. Refer to Project Controls Department Procedure 6.03 for more information on reporting project critical items. Other selected items from the list of appendices are covered elsewhere in this handbook. These include the Milestone Summary Schedule and trend reporting/scope change control. Refer to Project Controls Department Procedure 6.02 for more information on progress reporting.

4-2 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Project Summary Reports

Section 4

Critical Items Action Report WEEKS LATE ITEM 4

DESCRIPTION Delivery of Containment Electrical Penetration Assemblies

REFERENCE

PREVIOUS CURRENT

E-2027 E-2073

Schedule: 06-01-95 Forecast: 07-17-95

4

4

CAUSE & EFFECT

RESPONSIBILITY

ACTION

Cause: Configuration changes, vendor technical & production problems have caused slippage in scheduled ship dates.

Engineering

05-10-95 Two Electrical Engineers are presently at vendor shop to resolve technical problems.

Effect: Cable pulling & terminations in control room cannot begin until 15 selected assemblies are on-site and installed

Procurement

05-12-95 Negotiate incentive payment for assemblies shipped on schedule 05-11-95 Identify key assemblies (15) to support construction cable pulling schedule.

- 100,000 Ft of Cable - 4,300 connections

FIGURE 4-1 - SAMPLE PROJECT CRITICAL ITEMS REPORT

ASSEMBLE INITIAL INFORMATION

DETERMINE CRITICALITY

ANALYZE AND ORDER DATA

ISSUE CIAR (WEEKLY)

CIAR REVIEW (WEEKLY)

ASSEMBLE ADDITIONAL INFORMATION

FOLLOW UP ACTION ITEMS

OTHER GROUPS FOLLOW UP ACTIONS

FIGURE 4-2 - CRITICAL ITEMS REPORTING FLOW PROCESS DIAGRAM

PROJECT FINANCIAL REPORTING The Project Financial Status Report (PFSR) reports the financial status of the project in accordance with Project Controls Instruction No. 1. Depending on the project’s location, this report is compiled either in the field or in the Home Office by the (on-)project controls cost engineer. The projectdeveloped report is submitted to the Execution Unit’s Management Information (MI) group after review by the (on-)project controls manager, the sponsoring project controls manager, the business manager, and the project manager. MI schedules a review with the Execution Unit office and regional management. The frequency of reporting (normally bimonthly) is determined by MI. The overall work flow is shown in Figure 4-3, and a copy of the report’s Financial Overview is shown in Figure 4-4. The 1998 Edition 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

4-3

Section 4

Project Summary Reports

current report includes sections covering contract overview, gross margin analysis, risk assessment, change order status, cost of capital, staffing (including direct hire and Subcontracted manuals), procurement status, outstanding receivables, quantity data, project progress and performance data, and related discussion. A template, along with a set of definitions and instructions, is available from each Execution Unit’s MI group to assist in completing this entire report. Refer to Project Controls Department Procedure 6.04 for more information on the Project Financial Status Reports.

PCWorks also has the ability to generate a Project Cost and Revenue Summary. As a minimum, this report should contain the Original Budget, Current Budget, and Current Forecast for all revenue categories. Contract scope and unique project requirements will dictate the number of cost and revenue categories. Figure 4-5 shows typical lists of major cost categories. The PCWorks budget reports (shown in Appendix E), show similar information. Refer to Project Controls Department Procedure 6.06 for further explanations. PROJECT DATA SHEET The Project Data Sheet (PDS), shown in Figure 4-6, provides a one-page summary of project performance for use on fully (sub)contracted construction projects. The sheet contains selected key construction performance metrics, safety metrics, schedule and progress data, staffing levels and jobhour data, construction and total project cost breakdowns, and background information. It brings together all the information that is unique to construction projects but may not be provided on the PFSR. In fact, all of the information is covered in the current version of the PFSR except Estimate Basis (VI), Project Metrics (IX), and Safety Metrics (X). Summary engineering status is included, in addition to construction, so that engineering impacts to construction can be viewed. The PDS is prepared as BCOI management deems necessary. If the PDS is required, the timing of report updates should follow the frequency of the PFSR (generally bimonthly). For projects experiencing performance problems, a more frequent issue may be requested. The report format emphasizes construction information. Additional requirements may be added by the project team to reflect appropriate design status and performance metrics. PDS data sources are shown in Table 4-1. TABLE 4-1 - PROJECT DATA SHEET DATA SOURCES

Project Data Sheet - Data Block Item I. II. III. IV. V. VI. VII. VIII.

Schedule Information Progress (% Complete) Performance (PF) Cost Summary Nonreimbursable (NR) Costs Estimate Basis Staffing Jobhours

IX. Project Metrics X. Safety Metrics

4-4 55210\Construction Manua\Vol-2

Source Project Schedules Progress Curves, Project Financial Status Report Field Labor Summary Report Project Cost Summary, Project Financial Status Report Field N/R ledgers, CFIS Reports Project Estimator (one time only) Jobsite Force Report Project Financial Status Report, (Sub)Contract Labor Summary Report Calculated by field controls staff Standard Field Safety Reports

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Project Summary Reports

Section 4

MANAGEMENT INFORMATION

RIU & EU MANAGEMENT

PROJECT CONTROLS TEAM

START

DETERMINE WHICH PROJECTS REQUIRE PFSR

ISSUE MEMO TO PROJECTS

GATHER INFORMATION

SCHEDULE REVIEW MTGS

DEVELOP PRELIMINARY FORECAST

REVIEW WITH MGR. OF PROJ.

GATHER ACTUALS EXPENDITURES & JOBHOURS N

PFSR OK? Y

ISSUE PFSR TO MI

RECEIVE PFSR'S FROM PROJECTS

ANY ERRORS OR MISSING DATA?

Y COMPLETE FORECAST

Y

RECONCILE TO PREVIOUS FCST

NOTIFY PROJECT CONCUR AND PROVIDE DATA

N

N

FCST OK?

FILL IN FORM

INCORP COMMENTS REVIEW WITH PROJECT CONTROLS MGR

PREPARE PFSR REVIEW BOOK

REVIEW WITH RIU MGMT

N

FCST OK? Y FCST OK? Y UPDATE ORS DATABASE

JOINT REVIEW W/PM & PCM

N

Y

FCST OK?

RIU MGMT SIGNS APPROVED PFSR'S

N INCORP COMMENTS

ARCHIVE PFSR OPTIONAL REVIEW BY EU MANAGER STOP

NEW FCST REQ’D?

Y

N INCORPORATE COMMENTS

FIGURE 4-3 - PROJECT FINANCIAL STATUS REPORT WORKFLOW BY DEPARTMENT

1998 Edition 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

4-5

Section 4

Project Summary Reports

ABCD CAPITAL PROJECT - Job No. 12345 Project Financial Ov erv iew - Firm W ork Date:

(A )

(B)

Sectio n 1

(C)

(D)

(E)

(F)

(G)

T OTAL P R OJEC T

REVE NUE

As C urrent To Date: C urrent Booked B udget Fcst

"As So ld " GM/Jh r:

(H)

(I)

C urrent Yea r:1997 Op Plan

Delta

YTD:

C urrent Fcst

Delta

(J)

(K)

N ext

R emain'g

Year

Years

Fcst

Fcst

Agency / C lient Furnished 2 Reim bursable 3 Burden 4 Lum p Sum 5 Unit Price / Multiplier 6 Fee 7 Incentives 8 Reserves 9 Contingency 10 O ther 1

11 T otal Contract Re v e nue

0

0

0

0

0

0

0

0

0

0

0

9,678

0

0

0

0

0

0

0

0

0

0

-9,678

0

0

0

0

0

0

0

0

0

0

COS T 12 Agency / C lient Furnished

9,678

13 Non-R eim bursable Costs 14 NM Labor / Adds & Agency 15 Charge for W orking C apital 16 O ther C osts - Reim bursable 17 O ther C osts - Lum p Sum 18 Other Costs - UR , Multiplier 19 Contingency 20 W arranty 21 O ther 22 T otal Contract Costs 23 T OT AL PR OJE CT GM 24 T otal Non-M anual Jhrs 25 GM /Jhr 26 GM Share RIU @

%

27 GM Share RIU @

%

( All D o llar Fig u re s in 1 ,00 0 's )

Sectio n 2

(A )

(B)

(C)

(D)

Tota l P roje ct

GM R econc iliatio n E xpla nation 1 2 3 4 5 6 7 8 9 10 11 12 13

GM

Jhrs

GM/Jhr

(E)

(F)

Curre nt Ye a r GM

Jhrs

GM/Jhr

Forecast of GM & Jobhours for Previous PFSR Issue List of C hanges this P eriod -

14 Sub-total All Changes 15 New C urrent Forecast of GM & Jobhours

FIGURE 4-4 - PROJECT FINANCIAL STATUS REPORT

4-6 55210\Construction Manua\Vol-2

Principles of Construction Controls, Vol. II, (Sub)Contract Execution

1998 Edition

Project Summary Reports

Section 4

PROJ EC T NA M E (J OB XXXXX) P ROJ EC T C OST AND REV ENUE SUM M A RY ST A T US T HRU ORIGINA L

CURRENT

CURRENT

CURRENT

COST

TO- GO

BUDGET

BUDGET

FORECA ST

COMMITMENT

TO DA TE

COMMITMENT

COST

(A )

(B)

(C)

( D)

(E)

(F)=(C) -(D)

( G) =( D)-( E)

TO-GO

>>>> COST > REV ENUE S CHEDULED ACTUAL

4 3 , 9 75 9 , 6 44 1 8 , 9 90 0 1 , 5 72 9 , 0 68 0 0 3 0 , 8 84 9 30 2 , 3 53 2 6 , 0 92 7 1 , 4 65 2 6 , 8 18

500 500 200 0 100 200 0 200 600 0 400 200 3, 0 0 0 4, 0 0 0

240 110 91 0 56 121 0 59 114 0 241 113 452 592

171 160 58 0 54 5 0 8 135 0 21 86 367 1, 129

81 1 , 0 00

2 7 5, 0 3 9

24 1 , 7 91

9, 9 0 0

2, 188

2, 194

2 5 , 0 00 2 5 , 0 00 7 , 5 00 0 10 0 , 0 00 1 2 , 5 00 80 4 , 3 40 0 5 0 , 0 00 5 0 , 0 00 0 0 6 , 0 00 0 10 0 , 0 00 9 , 0 00

6, 0 3 0 5, 5 0 0 1, 8 0 0 0 1 8, 0 0 0 2, 0 0 0 2 2 6, 5 0 5 0 2 3, 7 0 0 7, 5 0 0 0 0 1, 2 0 0 0 7 5, 0 0 0 2, 0 0 0

5 , 3 12 1 4 , 8 09 2 , 3 15 0 3 , 0 43 1 , 2 43 0 0 1 6 , 2 18 4 , 2 15 0 0 0 23 12 9 , 1 76 7 94

1 0, 2, 1 0, 3, 3, 1, 2,

000 000 000 000 000 000 000 0 000 0 000 000 0 000 000 200

922 147 1, 528 423 532 121 0 0 1, 544 0 1, 140 833 0 97 1, 499 346

664 195 1, 965 435 177 186 683 46 1, 834 0 911 290 0 0 2, 152 687

1 , 18 9 , 3 40

3 6 9, 2 3 5

17 7 , 1 48

4 8, 2 0 0

9, 131

10, 225

2 1 4, 5 7, 3, 1 3, 4 9,

21 3 , 12 8 , 1, 6, 87,

0 00 0 00 0 00 0 00 0 00

1 9, 6, 6, 2, 1, 1 3, 2 1, 1 0, 3 8, 4, 3, 3 8, 1 0 7, 4,

< - - - - - - - - - - - - - - HOURS - - - - - - - - - - - - - - > BUDGET S CHEDULED ACTUAL

048 300 000 000 000 500 600 000 800 000 500 000 091 200

81 9 , 20 0 , 10, 50, 35 0 ,

0 00 3 00 0 00 0 00 2 00 0 00 0 00 0 00 0 00 0 00 5 00 0 00 0 00 0 00

OF _ _ _ _ _ _

400 000 900 100 000

6, 3, 2, 1, 4, 1,

6 67 9 56 3 10 0 42 2 72

1 , 42 9 , 0 00

3 3 7, 4 0 0

43 7 , 2 46

0

0

0

3 , 42 9 , 3 40

9 8 1, 6 7 4

85 6 , 1 86

5 8, 1 0 0

11 , 3 1 9

12, 419

S TARTUP MANUAL

1 , 06 8 , 0 08

0

0

1 9, 9 2 9

0

8

TOTAL MANUAL

4 , 49 7 , 3 48

9 8 1, 6 7 4

85 6 , 1 86

7 8, 0 2 9

11 , 3 1 9

12, 427

9 5, 9 8 5

25 , 1 4 5

19, 457

9 5, 9 8 5

25 , 1 4 5

19, 457

DI S TR.

TOOLS & S UP P LI E