Preface to the seventh edition xii

1 Introduction 1

Structure of the book 2

Objectives and contents 3

Section 1 4

Section 2 4

Section 3 5

Section 4 5

2 Quality management 7

Summary 7

Introduction 7

Notions of quality 7

Quality in transition 8

Quality control and inspection 9

Quality assurance 11

Total Quality Management 20

A systems approach to managing quality 25

Reference 31

Section 1: Project production management 33

3 Production process improvement 35

Summary 35

Introduction to lean construction 35

Productivity 36

Economic development 37

Energy consumption 39

Sustainability 40

International environmental protocols 41

UK emissions 44

Productivity improvement 44

Management systems 48

Management processes (BSI (2002), BS 6079-1:2002) 53

Employee participation 61

Macro key performance indicators 77

References 78

4 Planning techniques 80

Summary 80

Introduction 80

Planning in construction 80

Who plans? 81

Planning techniques 83

Other planning techniques 101

Modern construction planning 107

Data exchange 111

Planning multiple projects 113

Reference 116

Appendix 4.A: Normal probability distribution tables 116

5 Workforce motivation 117

Summary 117

Introduction 117

Motivation theories 117

Payment systems, remuneration and performance 121

References 131

6 Project cost control 133

Summary 133

A cost-control procedure for construction works 133

Systems in current use 134

Points to consider when choosing a cost-control system 145

Management of the carbon footprint 146

7 Management of equipment 147

Summary 147

Acquisition of plant and equipment 147

The fi nancing of equipment 148

Systematic plant selection 150

The essential characteristics of a decision situation 151

Setting hire rates 159

Marginal costing 166

Plant maintenance 167

Monitoring of maintenance servicing and exhaust emissions 168

References 168

Section 2: Business management 169

8 Project procurement 171

Summary 171

Introduction 171

The construction process (BS 6079-1:2002) 172

ISO/BS procurement standards 175

Appointing the team/parties to the contract 176

Public contracts and supplies 178

Project manager/leader 178

The contract 182

Health and safety considerations 186

Categories of contract 190

Separated and cooperative contracts 190

Management-oriented contracts 193

Integrated contracts 197

Discretionary contracts 205

Performance of different contract categories 209

References 210

9 Estimating and tendering 211

Summary 211

Introduction 211

Parties involved in estimating and tendering 213

The estimating process 214

BOQ estimating 215

Collection and calculation of cost information 217

Project study 225

Preparing the estimate 226

Tendering adjustments 232

Submitting the tender 234

Estimating in management contracting 235

Use of estimating software 237

Methods of estimating 240

Reference 241

10 Competitive bidding 242

Summary 242

Introduction 242

Part 1: A brief review of bidding strategy 243

Part 2: The importance of accuracy in estimating 250

Part 3: Some ways of using the existing theories 257

Recent developments in bidding 263

Client evaluation of bids 265

References 266

11 Company budgetary control 268

Summary 268

Introduction 268

Preparation of budgets 269

The carbon footprint 275

12 Cash fl ow and interim valuations 277

Summary 277

Introduction 277

The need for cash fl ow forecasting by contractors 277

The requirements of a forecasting system 279

Capital lock-up 284

The factors that affect capital lock-up 285

Interim valuations and cash fl ow 289

Measurement of work in activities 293

Computers and cash fl ow 294

Cash fl ow forecast by standardised models 296

Concluding remarks 297

References 297

13 Economic assessments 298

Summary 298

Introduction 298

Interest 300

Economic comparisons 303

Profi tability measures 305

Infl ation 310

Accuracy of future estimates 314

Financial modelling 319

Cost-benefi t analysis 323

Some worked examples 324

Appendix 13.A: Tabulations of interest and time relationships 332

Section 3: Administration and company management 335

14 Company organisation 337

Summary 337

Introduction 337

The function of a manager 337

Company organisational structures 339

Departments/functions 348

Health, safety, occupational welfare and pensions 356

Educational qualifi cations and vocational training 358

Corporate Social Responsibility 365

Management attitude 366

Reference 368

15 Market planning and business development 369

Summary 369

Introduction 369

Market planning 369

The business-development process 370

References 381

16 International construction logistics and risks 382

Summary 382

Introduction 382

The international environment 383

Conclusions 389

17 Information resources and ICT systems 390

Summary 390

Introduction 390

The construction company’s business 390

Processes involved in construction business 391

Information needs to support business processes 393

Management of contractors’ information resources 394

Construction information systems 397

The construction information manager 400

ICT in construction 401

ICT change within construction 402

Enablers of current construction IT 402

Using ICT resources in construction 403

Construction in a wireless world 414

Information security 415

18 Financial management 416

Summary 416

Introduction 416

Types of businesses 417

Types of capital 421

The control of capital 426

The company accounts 430

Regulatory authorities 444

References 445

Section 4: Self-learning exercises (solutions to the questions are

provided on the book’s companion website) 447

19 Questions – construction management 449

Questions 451

20 Questions – operational research (OR) 499

Summary 499

Questions 501

21 Questions – Six Sigma 511

Six Sigma 512

Problems 512

Reference 531

Bibliography 533

Abbreviations and acronyms 543

Index 548

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