Technical Program Abstracts

(TCM) Total Cost Management

NOTE: Program Subject to Change

(TCM-3331) Association of Engineering Design Quality and Project Performance

Author(s)/Presenters(s): Dr. James T. O'Connor; Jeyoung Woo

Abstract:

Engineering design quality affects the overall construction project performance in terms of cost, schedule, quality, and safety. Defects in engineering design deliverables, such as errors or omissions, can have strong and significant associations with construction phase rework. To better understand this association, the authors analyzed the Construction Industry Institute (CII) Benchmarking Data. The primary focus of this paper is to determine engineering design related variables through analysis of a CII Benchmarking survey questionnaire and to identify the variables that are significantly associated with construction phase outcomes. An analysis of variance (ANOVA) with Tukey post hoc testing was conducted to identify the most significant association between engineering design variables and construction phase performance. The authors identified three statistically significant associations: 1) the engineering design completeness impact on cost growth, 2) the objectives change impact on customer satisfaction, and 3) the impact of the remote office on engineering productivity during the engineering design phase. This study contributes to a better understanding of how to prioritize engineering design efforts in order to enhance overall construction project performance and to provide guidance for managing engineering design quality.

(TCM-3347) (Workshop) Follow-up: TCM-3301 A Practical Guide to Project Controls Development Abstract

Author(s)/Presenters(s): Dave Kyle, CCP CEP

Abstract:

This session is a follow-up to the interactive workshops presented last year providing the attendee with an opportunity to be guided by industry experts through the development of a first draft of a plan to improve their project controls department.

The attendees were guided through the completion of templates that when finished formed the first draft of a plan including: creating an identified vision and objective for the department; a prioritized 5 year development plan to close gaps in the quality of project control processes and tools; preliminary plans for each significant area of development; and a draft of a corporate presentation.

This session provides a chance to discuss the progress of the development and execution of the attendees plan for their department, troubleshoot difficulties, and progress their plans through small group discussion with industry experts.

(TCM-3382) Contract administration in project portfolio management: A case study

Author(s)/Presenters(s): Ricardo Goncalves Alves; Henrique Barbosa Oliveira; Mayra Rocha Costa

Abstract:

This paper discusses the application of an integrated framework for contract administration in project portfolio management. The authors will also provide examples and templates associated with the application of a management framework that comprises end-to-end contract lifecycle.

Other relevant aspects will also be delineated, including key activities concerning pre and post tendering processes, contract management routines, anti-claiming, quality, quantity takeoffs, amendment and close-out processes. Particular attention will be given to the data consolidation and performance evaluation in terms of contract management.

An overview of the project portfolio is presented, highlighting the strategic importance that contract administration has assumed in supporting project and portfolio management. In the case presented up to 200 contracts are administrated simultaneously, reaching total contracted sum that may exceed US$500 million.

(TCM-3395) Let's Talk Life Cycle Costs--2nd Edition of International Construction Management Standards

Author(s)/Presenters(s): Dr. Anil Sawhney

Abstract:

Since publication in July 2017, the International Construction Measurement Standards (ICMS) have provided a single methodology for reporting, grouping and classifying construction project costs. In response to industry feedback following the publication of the first edition of ICMS, the ICMS Coalition have introduced and are seeking feedback on a second edition which incorporates life cycle costs. The second edition will enable practitioners to classify costs across the whole project life cycle, eliminating inconsistencies and discrepancies when accounting, comparing and predicting project finances. This paper will discuss the classification framework and the design principles used in defining this framework. Different aspects of the taxonomy will be highlighted. Key consultative questions will be discussed.

(TCM-3406) Proving the Value of AACE Cost Engineering by Use of CII Research Studies

Author(s)/Presenters(s): Christopher W. Carson, CEP DRMP PSP FAACE; John K. Hollmann, PE CCP CEP DRMP FAACE Hon. Life

Abstract:

Professional associations such as AACE and others help define the best industry practices in Cost Engineering/Project Controls.  These practices are developed by industry experts, based on lessons learned from project success and failures, forensic analysis of disputes, and industry studies, and reviewed by professional peers.  That clearly makes the practices very valuable and useful to implement. 

However, actual quantitative evidence of the savings achieved by the use of these industry practices has been difficult to find, partly due to a lack of industry feedback of completed project results.  The Construction Industry Institute (CII) is the research arm of the construction industry, with its sponsorship from the University of Texas and the extensive partnering between large owner organizations, federal agencies, and university Civil Engineering and Construction Management staff.  CII has completed XXX separate research projects in areas that use project controls.

This paper collects the research data from CII, aligns it with relevant AACE Recommended Practices, and provides the specific results that demonstrate how good practices improve project performance, lower costs and reduce durations.  This paper will serve as a resource to support the use of specific industry best practices when planning and managing capital projects.

(TCM-3430) Project Controls Overview: Putting Together the Pieces of the Puzzle

Author(s)/Presenters(s): Nicole Johnson, CEP; Stephanie Kers; Dave Kyle, CCP CEP

Abstract:

As representatives of the Total Cost Management world, we are often seen as experts on all things Project Controls. In reality, there are many working in the TCM world that still don't understand every aspect of project controls. While it may not be necessary in your role to understand how everything works in the world of project controls, we all have a responsibility to understand how our role fits into the larger puzzle of project controls. For instance, how does estimating impact scheduling? Why is document control so important to the change order process? Where does my role fit within the project controls arena and why? Each of these are questions that can be answered by first understanding what project controls really means and how each element within it is interconnected. Our paper will provide a high level overview of this interconnectedness and some basic definitions of the 'puzzle pieces' within Project Controls as we focus on Roles, Relationships and Flow of Information for a typical project/program. Understanding this basic framework early on will facilitate the successful development of an efficient and fully integrated Project Controls department and will contribute to overall project success.

(TCM-3439) Building Cost Engineering Competence for Public Projects

Author(s)/Presenters(s): Mark C. Sanders, PE CCP CFCC PSP; Cristiam Castillo Ortiz; Mayli Salinas Luciano, PSP

Abstract:

Far too many public projects are delivered over budget and late, and too many fail to deliver their planned benefits. Some prominent researchers have argued that these failures are due to 'strategic misrepresentation,' during the project selection and approval process. Others have argued that they are due to project complexity, improperly managed risk, and changes in scope definition after project selection. Total Cost Management encompasses both project selection and project control processes, and an evaluation of an organization's cost engineering skills can identify gaps based on the TCM framework. This paper presents a study of the cost engineering skills of owner organizations against the TCM Framework, identifies the most common competency gaps, and proposes corrective actions.

(TCM-3444) Key Partnership Indicators in Project Cost Management

Author(s)/Presenters(s): Lori D. Vidak; Satinder S. Baweja, CCP

Abstract:

Cost engineers usually think of their work on projects in terms of data, analysis, reports, plans, and schedules. However, producing superior plans and schedules; collecting the most relevant data for the best analysis, and sharing valuable, useable reports requires effective communications within the working relationships of the project.

On each project, every cost engineer has many working relationships that affect the product produced. These are active partnerships. Also, less noticeable relationships exist between the CE and the end-users who access their work for decision-making.

The authors will present a map of these relationships, highlight those that most often hinder or harm project delivery, and present the top five ways to improve these relationships.

(TCM-3446) The Value of Integrated Project Controls in Commercial Construction

Author(s)/Presenters(s): Satinder S. Baweja, CCP

Abstract:

Project Controls is the process involved with tracking, review, and management of information needed to meet desired performance objectives.  Controls in project management terms can mean the collection of processes for schedule controls, cost controls, change management, and more.

On most commercial construction projects, one or all such controls are in place and practiced to some extent.  However, the rigor of their management varies between companies and from project to project.

A critical missing piece on too many projects is the lack of integration between these processes. The reason most commonly cited among general or specialty trade partners is that integrating is data-heavy and cumbersome and is overkill for most commercial projects. The result is an accepted level of inefficiency and apathy to the effect this condition has upon project delivery. Efficiencies achieved by using integrated controls are never measured or apparent. This paper discusses the need for a standard integrated control process for construction projects that achieves efficiencies greater in value than the dollars being spent to carry out these controls.

(TCM-3452) Life-Cycle Cost Analysis of Solar Photovoltaic (PV) Systems Installed in U.S Residential Buildings

Author(s)/Presenters(s): Dr. Nadia Al-Aubaidy

Abstract:

In 2018, about 63% of the electricity generated in the United States was from fossil fuels, 20% from nuclear energy, and about 17% was from renewable energy sources. Solar energy is one of the most promising renewable energy sources, especially given high fossil fuel prices, their limited supply, and climate changes, yet it accounted for only 1.6% of the electricity generated in the United States in 2018. Solar is a renewable energy source that is an investment that saves users' money, while saving our planet. As a result, the installation of Solar Photovoltaic (PV) Systems in residential buildings has experienced rapid growth in the United States, over the last several years. Residential building owners are incentivized to reduce energy costs by replacing conventional energy with solar energy systems. Nevertheless, recent studies reveal that owners are still doubtful about the potential benefits of the use of solar panels.  Recognizing the absence of extensive research studying the soundness of solar panel investment, this research is designed to study the life-cycle cost analysis of PV Systems used in residential buildings. A thorough literature review is conducted and case-studies are used to achieve this research goal. The research methodology starts by identifying and defining solar hardware and non-hardware costs associated with the entire project life. A life cycle cost model with sensitivity analysis is developed, quantitative data are gathered, and the Net Present, Annual, and Futures Values of solar panels for residential buildings are computed, predicted and compared statistically with those of buildings using conventional energy. This research presents evidence supporting the case for financial benefit to the owner who installs PV Systems in addition to solar's benefits to all of society, protecting our environment from pollution and saving our planet's resources from depletion.

(TCM-3468) Integrating Procurement with Project Controls is Critical for Cost Management

Author(s)/Presenters(s): Christopher W. Ronak

Abstract:

Project controls needs real-time, accurate and complete project data to be truly effective.  A significant percentage of the costs and activities of most construction projects, however, is commonly held in the purchase orders and subcontracts owned by a separate procurement department.  The challenge with this is, when project procurement is not a cohesive part of the project team, it introduces a disconnect and silo-effect that causes information delays, uncertainty and a lack of complete project visibility. This disconnect can be eliminated by integrating procurement directly into the project team and its project controls systems.  This not only provides real-time cost visibility, it also delivers key data on accruals, vendor performance, vendor progress, vendor trends and forecasts.  It additionally reduces legal risks that can arise due to knowledge gaps within a corporate procurement department that is not deeply familiar with the nuance of construction project procurement and contract management.  This paper will explore the importance of tightly connecting project procurement with project controls to reduce risk and gain complete, holistic picture of the project in real-time.  The concepts are drawn from many years working with organizations delivering major projects and the tangible results of rethinking the project-procurement relationship.

(TCM-3503) Strategic Portfolio Management: Funding and Finance Methodologies

Author(s)/Presenters(s): H. Lance Stephenson, CCP FAACE

Abstract:

In regards to strategic portfolio management and the project delivery world, most organizations have limited financial resources, making it increasingly difficult to support the execution of its capital portfolio programme. With this said, the authors of this paper provide some recommendations for the purpose of defining and implementing a methodology for supporting, and therefore improving, portfolio funding & financial development, implementation and administration. This paper further assists in providing the audience the necessary provisions for ensuring the effective and efficient use capital dollars by identifying opportunities for shared savings and improving cashflow utilization. This paper will provide readers with the following:

  • Implementation of a funding & financial management approach that will assist in funding optimization and utilization of the overall portfolio of projects; continuing to provide a value-add to the organization and improve competitive advantage through short- and long-term cash flow management.
  • An understanding of funding categorization and prioritization coupled with balancing commitments, spending and stewardship. This includes introducing techniques for funding long-term and high priority commitments while matching the needs for short-term and routine projects.
  • A relevant portfolio hierarchy and process designed to support both top down funding and bottom up budgeting and contingency management for portfolios, programs and projects.

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