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Construction Management > Midterm > Flashcards

Midterm Flashcards

1
Q

One advantage of the design/build approach is that usually a firm project cost is established
before construction begins.

A

False

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2
Q

One advantage of a Design/Bid/Build delivery method is known project costs before
construction begins.

A

True

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3
Q

In the case of design/build, the constructor acts as the general contractor with single-firm
control of all subcontractors.

A

True

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4
Q

In the case of Construction Management delivery method, the general contractor forms
contracts with the sub-contractors.

A

False

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5
Q

In the construction management approach, the construction manager usually guarantees the
overall price and quality of work.

A

False

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6
Q

If an owner has only fixed amount to spend and would not build a project if its cost would
exceed this amount, construction management would be the preferred delivery method.

A

False

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7
Q

If an owner has only fixed amount to spend and would not build a project if its cost would
exceed this amount, design-bid-build would be the preferred delivery method.

A

True

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8
Q

In a guaranteed maximum price (GMP) contract, cost above the GMP is covered by the
contractor.

A

True

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9
Q

An addendum is a change issued to a bidder after the contract award.

A

False

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10
Q

In a limited partnership, all the partners are liable to a limited amount

A

False

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11
Q

Call for tenders by the owner is treated as an Invitation in Canada.

A

False

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12
Q

Call for tenders by the owner is treated as an Offer in Canada.

A

True

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13
Q

Safety of a construction project is the responsibility of the general contractor

A

False

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14
Q

Safety of a construction project is the ultimate responsibility of the Safety Manager

A

False

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15
Q

Safety of a construction project is the ultimate responsibility of the Safety Manager

A

False

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16
Q

Unionized construction workers are generally paid higher than open-shop in Canada

A

True

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17
Q

Which category of construction would typically be contracted out as design/build

a. Residential
b. Building construction
c. Industrial
d. Heavy/Infrastructure construction

A

Industrial

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18
Q

Drawings and specifications are the output of what stage of a project

a. Concept and feasibility
b. Procurement
c. Engineering and design
d. Startup and implementation
e. None of the above

A

Engineering and design

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19
Q

Traditionally, concept and feasibility studies are handled by the……

a. Owner
b. Architect
c. Contractor
d. Subcontractor

A

Owner

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20
Q 
In what project phase are the bid package advertised and the project contracted out (so
construction can begin)?
a. Concept and feasibility
b. Engineering and design
c. Procurement
d. Construction
e. Operation and utilization
A

Procurement

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21
Q

Owner involvement is highest during what project phase?

a. Construction
b. Engineering and design
c. Concept and feasibility
d. None of the above

A

Concept and feasability

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22
Q

In design/bid/build, the architect signs a contract with the…..

a. Owner
b. Construction manager
c. General contractor
d. Subcontractor
e. None of the above

A

Owner

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23
Q

The term fast track means

a. Design/build
b. Construction starts before the design completes
c. Cost plus fixed fee
d. None of the above

A

Construction starts before the design completes

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24
Q

The developer of a 40-story high-rise office building desires the shortest possible
construction time. What contractual arrangement would be the best?
a. Construction management
b. Design/build
c. Design/bid/build
d. Either of a) or b)
e. None of the above

A

Either of a) or b)

25
Q

Value engineering can be best described as…

a. Reducing cost by reducing quality
b. Getting the best value for the least cost
c. Reducing scope to achieve the budget
d. Recognizing project team to achieve the greatest efficiency
e. None of the above

A

Getting the best value for the least cost

26
Q 
Construction management is superior to design/bid/build approaches at addressing which of
the following concerns?
a. Increased government regulations
b. Larger projects
c. Increased organizational size
d. Increased organizational complexity
e. All of the above
A

All of the above

27
Q

Which of the following is true of a GMP contract?

a. GMP is the same as lump sum bid
b. The contractor passes all costs to the owner up to a predetermined maximum
c. The owner assures all project risks
d. The construction manager assures all project risks
e. None of the above

A

The contractor passes all the cost to the owner up to a predetermined maximum

28
Q

“Esprit de corps” is a term associated with

a. Order and discipline
b. Morale
c. Goals and accountability
d. Mentoring
e. Communication

A

Morale

29
Q

Which of the following term is used to describe the “unofficial/informal” relationship
established between two workers in two different departments
a. Matrix
b. Pooled relationship
c. Gangplank
d. Leadership
e. Responsibility

A

Gangplank

30
Q

Which of the following legal forms of business organization/s is perpetual?

a. Sole proprietorship
b. Partnership
c. Corporation
d. All of the above
e. None of the above

A

Corporation

31
Q

Long-lead items are materials or equipment typically ordered and bought by the

a. Owner
b. Designer
c. Construction manager
d. Trade contractor
e. Sub-contractor

A

Owner

32
Q

IAR is the main output of the project planning phase. The term IAR stands for

a. Internal analysis report
b. Internal advancement report
c. Investment advancement report
d. Investment analysis report
e. Information analysis report

A

Investment analysis report

33
Q

Two main perspectives of project commissioning is

a. Design and Planning
b. Engineering and Planning
c. Engineering and Contractual
d. Operational and Planning
e. Operational and Contractual

A

Engineering and contractual

34
Q

What is meant by alternates in construction bidding process? Are
alternates beneficial for the owners? Why?

A

An alternate is a request for a price for substituting one material for another, for adding to the
scope of work, or for deducting from the scope. It is beneficial for the owners to explore new
concepts and design options from multiple parties.

35
Q

Explain Adenda in construction bidding process?

A

An addenda is a change in the documents made during the bidding phase, before contract award

Timeline should show the Addendum between bid call (offer in the Canadian system) and bid submission (acceptance in the Canadian system). More accurately, about 15 days before the bid submission.

Bidders often identify inconsistencies that must be corrected
Bid documents may also be released prior to design completion such that the addenda complete the remaining design.

Acknowledgement of all addenda releases occurs on the bid form

36
Q

What is a Public Private Partnership (PPP)? Discuss the pros and
cons of Public Private Partnerships for the owners (or public).

A

Public–private partnership (PPP) describes a government service or private business
venture which is funded and operated through a partnership of government and one ormore private sector companies. These schemes are sometimes referred to as PPP, P3 or P3.

This approach for project delivery, where the private sector has to finance, design, build, operate, and maintain the facility and then transfer it to the government after a specified concession period, this PPP approach to doing business is gaining acceptance by governments around the world because of claims that it can deliver infrastructure and services more efficiently and at a lower cost than traditional methods. It is a generally accepted notion today that P3 procurement has the potential to deliver value for money over conventional procurement methods, if it is used for the right projects.

37
Q

What are the available labour options in Canada? Describe pros
and cons of each option to the workers.

A

There are mainly two labour options available in Canada -

  1. Unionized labour (Unions); also known as Closed Shop
  2. Non-Unionized Labour (Merit Shops); also known as Open Shop

Trade unions were more popular because of fair wages and health and safety benefits to workers, but due to certain dispute regarding job responsibilities, geographic territory claims and internal disputes created mistrust and Merit Shop became more popular in the construction industry.

38
Q

Unionized labor

A

In terms of training: Development of a broad set of skills to perform many
different tasks within an specific trade

In terms of satisfaction/motivation: Higher perception of task identity, but
lower perception of autonomy

In terms of salary: Higher salary; Pay is negotiated collectively, based on seniority
and trade

39
Q

Non unionized labour (Merit Shops)

A

a) Work : It is easy to get hired; piecework
pay is available

b) In terms of training: Training in an
specific sub sets of skills that can be used
in different tasks, providing greater versatility

c) In terms of satisfaction/motivation: Lower
perception of task identity, but higher
perception of autonomy

d) Higher motivation
e) In terms of salary: Lower salary

40
Q

What are the main construction project delivery methods?

Discuss project risk distribution among the involved parties under each method.

A

Design/Build

Design/Bid/Build

Construction Management

41
Q

Design/Build Risk

A

Contractor assumes most of the construction, and design risks. However,
depending on the contract type, owner may assume financial risks.

42
Q

Design/Bid/Build Risk

A

Contractor assumes financial and construction risks. Engineer assumes
design risks.

43
Q

Construction management

A

Owner assumes both financial and construction risks.

Designer/engineer assumes design risks.

44
Q

4 Main construction sectors in NA

A

Residential
Commercial
Industrial
Heavy

45
Q

Residential Construction

A
  • wood products, light gauge steel
  • low overhead; high competition
  • low profit margins & high number of bankruptcies
  • close working relationships with owners
  • strongly influenced by interest rate & economy
46
Q

Commercial Construction

A
  • technically complicated construction systems
  • numerous specialty contractors involved
  • variety of construction materials
  • require extensive knowledge in construction process, communication & leadership skills
47
Q

Industrial Construction

A
  • require highly specialized expertise
  • substructure construction is the key
  • heavy materials: steels, concrete
  • schedule driven
  • technology is more complex
48
Q

Heavy Construction

A
  • mostly financed by public
  • use large qualities of a relatively small materials
  • heavy duty construction equipment required
  • higher profit margin
49
Q

What is the purpose of Kick-off meeting in pre-construction

stage? What are the outputs of this meeting?

A

• To review roles, responsibilities, procedures (particularly safety procedures) and contractual
obligations with the contractor
• To review contract administration requirements and the regulatory requirements
• To build a constructive working relationships under Partnering programs
• Review General Conditions
• Check bonding and insurance compliance if applicable.

Outputs
• Sets up the ground rules for contractors and subcontractors
• Outlines processes that will be followed
• Calls attention to critical project elements
• Ensures all the necessary permits are in place

50
Q

What is the purpose of bonds in construction business? Describe
the role of bonds in the bidding process.

A 
• Agreement made between three parties
– The Principal (Contractor)
– The Surety (Bonding Company)
– The Obligee (Owner)
• The Surety becomes liable to the Obligee for the default or failure of the Principal in performing
some obligation
51
Q

Show the differences in three main organizational settings in
construction with diagrams (you may need to explain the differences as well)

A

Wide span of control-Description
- boss controls all subordinates

Departmental-Description
Managing Principal has support staff&raquo_space;Department Heads&raquo_space; Design / Const. Doc’s / Cont. Admin.

Matrix- Description (2 Marks)
Similar to Departmental except order is:
Managing Principal has support staff&raquo_space; Department Heads and Project Management&raquo_space; More Project Management and Operations

52
Q

Corporation

A

• Corporations are legal entities created by binding individuals into one group under a corporate name
• The corporation is owned by its stockholders, who may reside inside or outside the company•
The corporation’s business is controlled by a board of directors which is elected by the stockholders

Advantages of a corporation
• Limited owner liability
• Extended financial resources
• Uninterrupted life of the company

Disadvantages of a corporation
• Costly to start-up
• Double taxation of the company’s profit at both the federal and state/provincial level
• Strict government regulations
• May be bureaucratic
• Management may not carry the same incentive for success as other forms of business ownership

53
Q

Limited Partnership

A
  • No legal entity – controlled by the general partner and limited partners
  • A co-owner’s liabilities and profits are limited and are equal to the amount of capital and property invested in the company
54
Q

What is meant by Bidder Prequalification? What are the benefits
of Bidder Prequalification?

A

Bidders should be put through a qualification process to verify that if selected they will have both the resources and expertise to successfully perform the work they have been contracted to complete. To assess the capability of potential tenderers to perform the requirements of a forthcoming contract and is carried out before the commencement of negotiation or bidding process

55
Q

Briefly explain the key phases in project delivery system.

A

– Planning: identify and define, assess alternatives, budget and completion date, criteria, 5 steps, main output is IAR

– Definition: translate IAR, project brief/scope definition, implementation strategies,
responsibility, choose a consultant. 2 major steps: #1 = production of the project brief/scope definition; #2 = consultant selection.

– Implementation: 3 steps: Design (obtain approvals, estimate costs and prepare drawings and specification. Design has 7 steps: 1) setup design team; 2) define project control criteria; 3) pre-design report; 4) concept design; 5) design development; 6) project approval; 7)construction documents; Tendering and Award (select contractor who will unconditionally meet terms and conditions; Pre-Construction Services); Construction (most expensive, intensive and difficult phase).

– Commissioning: process of advancing an installation from state of static completion to full working order in accordance with design intent. Commission for engineering and contractual perspectives.

– Operation: establish and ensure reliability in facility, maintain adequate O&M records, establish preventative maintenance program, identify an operating and maintenance budget.

– Evaluation: objectives include assessment, compare performance, identify variances and record project performance. Types of evaluation: project, contractor and consultant evaluation.

56
Q

What is meant by Bidder Prequalification? What are the benefits of
Bidder Prequalification?

A
  • Bidders should be put through a qualification process to verify that if selected they will have both the resources and expertise to successfully perform the work they have been contracted to complete.
  • To assess the capability of potential tenderers to perform the requirements of a forthcoming contract and is carried out before the commencement of negotiation or bidding process

i. Timing(before the formal bid call)
ii. Less bid document to review (serious bidders)
iii. Building long term relationship (specialty ,trust)

Benefits:
 Less number of tender documents for review
 Better assurance of quality and technical capabilities of the tenderers
 Better trust among the owner and contractors
 Assists in selecting specialized contractors
 Better communication process during the bidding process due to less number of contractors and know people.

57
Q

What are the key ingredients (needs) of a legal (enforceable)
contract? Briefly explain.

A

– Offer: a proposal from one party to the other (offeror to an offeree), which contains
essential terms of the proposed contract.
– Acceptance: Unequivocal (Clear/undeniable) agreement to an offer.
– Consideration: Something of value given or promised by each party to the contract.
– Capacity: legally having the ability to enter in to a contract (not a minor, suitable mental
capacity, not bankrupt, not drunk or with the influence of drugs, terrorists of “enemies
of states”)
– Rightful purpose: The contract is for legally acceptable purpose.

58
Q

What are your options, as the Owner, if the lowest tender price is
too high? What can be the possible causes of this situation?

A

Options
Acceptance of the original price
Acceptance of a reduced price
Unilateral reduction by the lowest bidder or
Negotiations on minor changes in scope
– Re-inviting THREE low bidders
When unable to secure a satisfactory reduction in price from the low bidder in relation to minor
changes in scope
– Re-invite all bidders
When changes in scope are substantial without changing the nature of the work
Causes:
Errors in owners bid estimates
Scope misunderstandings in bid documents
Unforeseen risks/challenges (of the project) by the owner
Sudden price escalations in the market
Owner’s misunderstanding about the market conditions

Construction Management (1 decks)

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