QuantitySurveyors-Changing role

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Information about QuantitySurveyors-Changing role

Published on December 13, 2008

Author: bsvr

Source: authorstream.com

Quantity Surveyors : Quantity Surveyors Their role & the emerging changes in their role with changes in construction contracting practices. Quantity Surveyor - Functions : 2 Quantity Surveyor - Functions Manage and control costs within construction projects Use a wide range of management procedures and technical tools to achieve this goal. Quantity Surveyor - Functions : 3 Quantity Surveyor - Functions Measurements, Estimation Costing, Valuation, Tender pricing Minimize cost & Enhance value Role differs slightly With Owner With Contractor As Valuer Traditional Role : 4 Traditional Role QS – measurer, arrives at quantities of different items of work for Tender document preparation (for owner) Tender pricing (for contractor) Handles the BOQ and price schedules Bills for payment, intermediate & final Measures quantities from drawings & from site Professional Quantity Surveyor Contractor’s Quantity Surveyor Change over the years : 5 Change over the years Costs have become dynamic; Fast Changes. Technology change, Mechanization. From primarily civil engineering work to a mix of work of different disciplines, particularly Electrical, Air-Conditioning, Plumbing, Electronics, Fire detection & protection----- Corresponding to change from single & double story construction to multistory complexes. Energy costs and Environmental requirements. Change over the years : 6 Change over the years Energy costs have also brought in a change in the outlook of the architectural design of buildings. We cannot afford to overlook the operating cost of the building as a whole. Closely associated with the energy are the environmental factors associated with energy usage. Energy & Environment : 7 Energy & Environment Global Warming which was considered to be a distant dream of a pessimistic scientist is now identified to be a reality staring at us. Energy consumption is directly associated with the production of green house gasses and global warming. We cannot afford to face the consequences on the environment Building & Energy : 8 Building & Energy Our building designs should keep energy in all its forms and stages of utilization Energy that goes into the formation of the building materials. Energy that is utilized in the construction. Energy that will be spent during the life time of the building. Speed of Construction & Maintainability : 9 Speed of Construction & Maintainability The speed of construction has also been assuming importance. Speed of construction is dependent on the method adopted and the type of structure. Maintainability is another aspect. Today with the gradual but continuous increase in the labor costs it is essential that the design is such that the requirements of resources are kept to the minimum. Computers, IT & Automation. Requirement Today : 10 Requirement Today Quantity Surveyor is required to know(?) Basic civil work processes & costing. Component materials. Material selection & Equipment Selection and effect on costs. Building operation costs based on the aspects of Energy efficiency, Environment friendliness, Maintainability. Drivers for the Change : 11 Drivers for the Change Changes driven by energy, environment, IT, fire, natural hazards like earthquake, floods, cyclone, tsunami have influenced construction in a big way. Major change in technology, materials. Standards & Codes. Regulatory bodies, Local Byelaws, pollution, Manpower availability, shortage of trained & skilled workers Changing role of QS : 12 Changing role of QS Cost controller, Material Management Procurement of material & equipment Work coordination strategy Life cycle costing Taxation & Tax planning Outsourcing & sub contracting Work break-down & package development Special work packages and costing Dispute resolution Quantity Surveyor’s Contribution to the project : 13 Quantity Surveyor’s Contribution to the project Change from a limited role of measurement & related calculations to correlate to the Bill of Quantities To a key management functionary to influence & manage cash flow of the project activity Qualifications, training, opportunities in India & abroad, brief case study of new role continue with Role dependent on contract system or BoQ system : 14 Role dependent on contract system or BoQ system Item Rate, Percentage rate, Lump sum Labour only, turn key, composite Design & Build, Design, Build & Operate Build Operate Transfer, Build, own, operate & transfer Propose, design, build, own, run, share Qualifications & Training : 15 Qualifications & Training India did NOT have QS courses Sample of a UK university course is given ---------- 2 or 3 year degree In India NICMAR is giving a PG course QS subject exists in some Engineering & Architectural course syllabus Professional Association conducted exams deemed equivalent qualification Professional Associations : 16 Professional Associations Royal Institute of Chartered Surveyors - RICS Australian Institute of Quantity Surveyors (AIQS) Canadian Institute of Quantity Surveyors (CIQS) Hong Kong Institute of Surveyors (HKIS) Institute of Quantity Surveyors of Kenya (IQSK) Institute of Quantity Surveyors Sri Lanka (IQSSL) Royal Institution of Chartered Surveyors (RICS) UK website for Quantity Surveyors (QS Week) UK website for Quantity Surveyors (QS News) New Zealand Institute of Quantity Surveyors (NZIQS) The Institution of Surveyors, Malaysia (ISM) Differing role of QS : 17 Differing role of QS With the owner Preparation of BoQ, schedule, specs, tender documents, derive from drawings & specs & codes Prepare material / equipment procurement schedule & cash flow, verify measurements & bills With Contractor Price the BoQ on the basis of drawings, specs, codes Measure, prepare bills & plan cash flow Initiate addition & change orders Financial & Legal aspects : 18 Financial & Legal aspects Process financial controls, inventory control Dispute resolution – ADR, Concilliation, Arbitration Labour welfare management, worker training Valuation of assets Asset management Plant & Machinery, materials, equipment New Subjects In Curriculum : 19 New Subjects In Curriculum Economics, Derivatives, Financing Risk Evaluation & Management International contracting, exports Intellectual property rights Health & Safety regulations Case StudyHeathrow Airport Extension : 20 Case StudyHeathrow Airport Extension Europe’s largest and most complex construction projects. HEATHROW TERMINAL 5 4.3 billion Pound; Nov 2001 start; March 2008 finish 260 Hectare site; 16 projects; 140 sub projects 1500 contracts; Monthly 80 million Pounds work; over 8000 workers. Gives 50% additional capacity to the terminal. Unique Landmark Contract : 21 Unique Landmark Contract The T5 agreement is a unique legal contract in the construction industry – in essence it is a cost reimbursable form of contract in which suppliers’ profits are ring-fenced and the client retains the risk. non-adversarial style on the causes of risk and risk management through integrated team approaches. no claims for additional payments and no payment disputes so far on the project Will save 24 months of construction time!!! Slide 22: 22 BAA uses cost information from other projects, validated independently, to set cost targets. If the out-turn cost is lower than the target, the savings are shared with the relevant partners. This incentivises the teams to work together and innovate. It is the only way to improve profitability: all other costs, including the profit margin, are on a transparent open-book basis Agreement focuses on managing the cause and not the effect and ensures success in an uncertain environment. High performance levels and high benchmarking standards are demanded from all parties. “The idea is to have the best brains in all companies working out solutions to problems not working how best to defend their own corner” Slide 23: 23 BAA selected a consultancy framework for cost consultancy on the T5 project comprising the Turner & Townsend Group and EC Harris Group Ltd (known as TechT). Both companies were selected under the same terms of commission and each provided 50% of the staff. On this project these two major consultancy companies became one team “joined at the hip”. At its peak the cost consultancy team comprised 120 staff, approximately two thirds of which were quantity surveyors. Conclusions : 24 Conclusions Preparing development appraisals • Development of the business case and master planning. • Producing the facility cost model allowing option appraisals within the master planning phase and functionally based cost planning. • Executing the business case sensitivity analysis to test each option’s rates of return on investment. • International benchmarking of airport indicators (operational and construction measures) to assist with target setting. Conclusions : 25 Conclusions 2. Advising clients on project brief, preferred procurement route and cash flow • Design of the incentivised procurement strategy and resultant contract terms and conditions involving the development of an innovative strategy and framework agreement against which contracts could be let. • TechT and Laing O’Rourke provided comprehensive commercial benchmarking across the whole T5 programme to enable BAA to judge whether the Anticipated Final Cost (AFCs) provided good/poor value for money compared to other BAA and non BAA projects. Conclusions : 26 Conclusions 3. Analysing whole life costs • Implementation and management of an innovative value improvement process which secures cost and time based on themes of designing, buying and delivering better. 4. Planning the construction process • Project management of the Planning Supervision process. • Project planning undertaken jointly between BAA/Laing O’Rourke based on overall T5 Strategic Plan using Primavera; however QS role minimal. • Sub-Project Planning - each sub-project (£75-£100m) has its own cost and programme target - progress against the programme is commercially monitored. Conclusions : 27 Conclusions 5. Monitoring control of cost during pre-contract stage • TechT cost managers engaged with suppliers’ cost managers to verify the cost plans and ensure alignment with the schedule. The aim was to achieve a cost plan that was 95% bottom up i.e. based on figures from suppliers by BAA’s “D Day” (the milestone before the site assembly starts but when most of the manufacture is complete and design is 95% complete). • Contractors were required to monitor their pre-contract costs and continually update BAA on the forecast cost for this period. Conclusions : 28 Conclusions 6. Preparing tender and contractual documentation • TechT supported BAA’s Supply Chain team to negotiate and periodically review the Commercial Model Agreements (CMAs) between BAA and each of the 1st tier suppliers. • TechT supported BAA’s Supply Chain in providing advice on appropriate procurement routes and choice of Supply for each work package then utilised the CMAs as a basis for agreeing the AFC. 7. Advising on payments to contractors, cost control and settlement of final accounts : 29 7. Advising on payments to contractors, cost control and settlement of final accounts Majority of 1st tier contractors reimbursed on “an actual cost based” form of contract; interim payments and final account based on actual cost. • TechT work in conjunction with BAA’s cost verification team to check, audit and then verify that the costs approved for payment are valid. • used COINS (accounting package) to collate costs; BAA/TechT had read-only access to COINS to verify that costs were properly incurred. • BAA ran the project using Oracle/Artemis; contractors feed information into Artemis using comma separated variable (CSV) files on a weekly basis, updating costs, progress and forecasts on a work breakdown structure (WBS) basis. Slide 30: 30 Laing O’Rourke developed their own data-base system of weekly capturing costs against WBSs, recording progress and forecasting final costs, this was loaded electronically into BAA’s Artemis system every Wednesday for the previous week. 8. Controlling the project on behalf of their employer • Supporting BAA’s integrated team in the preparation of the project process and procedures and implementation of a project control system and software including change control and risk management. • Introduction of performance management system with KPIs based on cost, time and quality criteria. • Provision of monthly earned value analyses (linking time and cost) and schedule performance indices. • TechT have driven the production of – and are the acknowledged owners of two of the ten core processes at T5 – Cost Management and Commercial Management. Slide 31: 31 9. Negotiating with client or subcontractors • TechT work with BAA in agreeing AFC targets throughout the duration of the programme; each project and sub-project has its own AFC target, progress against which is reported on and discussed on a monthly basis. • TechT together with BAA’s supply chain and 1st tier contractors work as collaborative teams. 10. Reporting on the programme and financial matters • The TechT cost managers are integrated within their project and sub-project teams, they report to the project leader, who in turn reports to the T5 Directors; TechT are also represented at Programme Office level. • The Heads of Cost Management, Commercial Management and Performance Measurement are all senior TechT people reporting to BAA Directors. Conclusions : 32 Conclusions 11. Risk and value management • Ongoing option appraisal and value engineering of construction systems. • On going value improvement initiative focusing on productivity improvements and global acquisition combining leverage and partnering based buying. • Development of bespoke Risk Management Process aligned to the T5 insurance cover. 12. Giving contractual advice in case of dispute • Minimal dispute due to collaborative nature of the contract team. Conclusions : 33 Conclusions The example of the present running project gives an overview of what is expected of the Quantity Surveyor in the new role demanded of them in the context of the mega projects that are coming up with great complexity. Thank You

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