University of Jordan Year 2016/2017 2nd Summer Semester General Introduction to Project Management Arch. Dania Abdel-Aziz

1. Project Management –
Implementation (4)
8/13/2017 1Arch. Dania Abdel-Aziz/ Lecture 11
University of Jordan
Year 2016/2017
Second Summer Semester
Arch. Dania Abdel-Aziz

2. Content
1. Steps / Phases
2. Partial techniques and tools per step
1. 1. PROJECT INITIATION
2. 2. PROJECT PLANNING & SCHEDULING
3. 3. PROJECT CONTROL
4. 4. PROJECT TERMINATION / EVALUATION
3. Related software
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3. MANAGING RISK
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4. Risk Management Process
Risk - An uncertain event that, if it
occurs, has a positive or negative effect
on project objectives
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Unknown Unexpected
UndesirableUnpredictable

5. WHO IS AT RISK AND WHAT ARE
THE RISKS
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6. Who is at Risk
1. Owner
2. Architect
3. Contractor
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7. What are the Risks
• Owners Risks
– Damage to the project.
– Delay in start up.
– 3rd party Bodily Injury /
Property Damage.
– Error in design.
– Change orders.
– Environmental.
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8. • Architects Risks
– Error in design
– 3rd Party Bodily Injury / Property
Damage
• Contractors Risks
– Damage to project
– 3rd party Bodily Injury / Property
Damage
– Delay by performance
– Environmental
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What are the Risks

9. The Construction Process
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1
2 2
3
2
4
5
6
7
8
Quality Control
Value Engineering
Construction SchedulingDesign Scheduling
Design Cost Control
Establish
Budget
Change Orders
Construction
Punch
List
Bid
Working
Drawings
Design
Develop-
ment
Schematic
Design
Archi-
tectural
Program
Budget Compatible
With Program
Advertisement
for Bid
Pre-Bid Conference
Notice of Award
Letter of Intent
Sign Contract
Notice to Proceed Substantial
Completion
Fina
Completion
Warranty

10. Common Construction Insurance Coverage
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Builders’ Risk 
General Liability  
Business Automobile  
Workers’ Compensation  
Equipment Floater 
Professional Liability 
Basic Coverage Architect/Engineer Contractor

11. TYPICAL PROJECT DELIVERY
METHODS
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12. Typical Project Delivery Methods
• Design - Bid - Build
• Construction Manager
– At risk
– Not at risk
• Design Build
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13. 8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 13
Construction Management
Manager not at Risk
Owner
Construction
Manager
Trade
Contractor
Architect/
Engineer
Trade
Contractor
Trade
Contractor
Trade
Contractor
Project Delivery Methods

14. 8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 14
Construction Management
Manager at Risk
Owner
Construction
Manager
Trade
Contractor
Architect/
Engineer
Trade
Contractor
Trade
Contractor
Trade
Contractor
Project Delivery Methods

15. 8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 15
Design - Build
Owner
Design - Build
Team
General
Contractor
Architect/
Engineer
* Joint
Venture
Architect/
Engineer
General
Contractor
Subcontractors
Subconsultants
Design - Build Team Options:
Project Delivery Methods

16. TYPES OF RISKS IN CONSTRUCTION
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17. Types of Risks in Construction
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Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related

18. Types of Risks in Construction
8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 18
Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Acts of God
 Flood
 Earthquake
 Landslide
 Fire
 Wind damage

19. Types of Risks in Construction
8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 19
Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Acts of God
Construction Related
 Labor productivity
 Different site conditions
 Design changes
 Equipment failure

20. Types of Risks in Construction
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Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Design
 Incomplete design
scope
 Defective design
 Errors & omissions
 Inadequate
specifications

21. Types of Risks in Construction
8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 21
Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Physical
 Damage to structure
 Damage to equipment
 Labor injuries
 Fire
 Theft
Design

22. Types of Risks in Construction
8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 22
Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Construction Related
Political & Environmental
 Changes in laws and
regulations
 Requirement for
permits
 Law & order
 Pollution and safety
rules

23. Types of Risks in Construction
8/13/2017 Arch. Dania Abdel-Aziz/ Lecture 11 23
Physical
Risks
Financial
Economic
&
Acts
of
God
Political
Environ.
&
Design
Const.
Related
Construction Related
Financial & Economic
 Inflation
 Availability of funds
 Exchange rate fluctuations
 Financial default
Political & Environmental

24. RISK MANAGEMENT
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25. Risk Management Process
Risk Management
– A proactive attempt to recognize and
manage internal events and external threats
that affect the likelihood of a project’s
success
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26. Risk Management Process
Risk Management
• What can go wrong (risk event)
• How to minimize the risk event’s impact
(consequences)
• What can be done before an event occurs
(anticipation)
• What to do when an event occurs
(contingency plans)
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27. The Risk Event Graph
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28. Risk Management’s Benefits
• A proactive rather than reactive
approach.
• Reduces surprises and negative
consequences.
• Provides better control over the future.
• Improves chances of reaching project
performance objectives within budget
and on time.
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29. Risk Management Limitations
Lack of Expertise and Awareness.
Difficult to Apply.
Unable to Effectively Deal with Human Factors (Qualitative
Elements).
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30. RISK MANAGEMENT PROCESS
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31. The Risk Management Process
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32. Managing Risk
Step 1: Risk Identification
– Generate a list of possible risks
through brainstorming, problem
identification and risk profiling.
• Macro risks first, then specific
events
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33. Managing Risk
Step 2: Risk Assessment
– Scenario analysis
– Risk assessment matrix
– Failure Mode and Effects Analysis
(FMEA)
– Probability analysis
• Decision trees, NPV, and PERT
– Semi quantitative scenario analysis
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34. Partial Risk Profile for Product Development Project
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35. Risk Breakdown Structure
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36. Risk Assessment Form
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37. Impact Scales
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38. Risk Severity Matrix
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39. Step 3: Risk Response Development
– Mitigating Risk
• Reducing the likelihood an adverse
event will occur
– Transferring Risk
• Paying a premium to pass the risk to
another party
– Avoiding Risk
• Changing the project plan to
eliminate the risk or condition
– Sharing Risk
• Allocating risk to different parties
– Retaining Risk
• Making a conscious decision to
accept the risk
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Managing Risk

40. CONTINGENCY PLANNING
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41. Contingency Planning
Contingency Plan
– An alternative plan that will be used
if a possible foreseen risk event
actually occurs
– A plan of actions that will reduce or
mitigate the negative impact
(consequences) of a risk event
• Risks of Not Having a Contingency Plan
– Having no plan may slow managerial
response
– Decisions made under pressure can
be potentially dangerous and costly
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42. Risk Response Matrix
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43. Risk and Contingency Planning
1. Technical Risks
– Backup strategies if chosen
technology fails
– Assessing whether technical
uncertainties can be resolved
2. Schedule Risks
– Use of slack increases the risk of a
late project finish
– Imposed duration dates (absolute
project finish date)
– Compression of project schedules
due to a shortened project duration
date
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44. Risk and Contingency Planning
3. Costs Risks
– Time/cost dependency links: costs
increase when problems take longer to
solve than expected.
– Deciding to use the schedule to solve
cash flow problems should be avoided.
– Price protection risks (a rise in input
costs) increase if the duration of a
project is increased.
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45. Risk and Contingency Planning
4. Funding Risks
– Changes in the supply of funds for the
project can dramatically affect the
likelihood of implementation or
successful completion of a project.
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46. Risk and Contingency Planning
• Contingency Funds
– Funds to cover project risks—identified and unknown
• Size of funds reflects overall risk of a project
– Budget reserves
• Are linked to the identified risks of specific work packages
– Management reserves
• Are large funds to be used to cover major unforeseen risks (e.g.,
change in project scope) of the total project
• Time Buffers
– Amounts of time used to compensate for unplanned delays in the
project schedule
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47. Contingency Fund Estimate (000s)
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48. Managing Risk
Step 4: Risk Response Control
– Risk control
• Execution of the risk response
strategy
• Initiating contingency plans
• Watching for new risks
– Establishing a Change Management
System
• Monitoring, tracking, and reporting
risk
• Repeating risk
identification/assessment exercises
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49. Change Management Control
Sources of Change
– Project scope changes.
– Implementation of contingency plans.
– Improvement changes.
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The Change Control Process

50. Change Request Form
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51. Change Request Log
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52. Homework
• Write your own CV
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53. Thank you 
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