The Beginning of Semester 2

(Projects in a commercial environment)

Introduction to Procurement

Returning to University in the 3rd week of January after a good Christmas holiday, we kick-started the day with an introduction to procurement. Firstly learning that: The Chartered Institute of Procurement & Supply defines procurement as: “Procurement and supply management involves buying the goods and services that enable an organisation to operate in a profitable and ethical manner.” Basically, procurement involves a lot more thought than simply purchasing something, taking more care to consider things such as price, quality, time, location and reputation.

Procurement can be like a process; it requires contracts and relationships between parties and becomes more complicated and thorough depending on the risks involved with the project.

A procurement route is all about deciding on allocation of risks in respect of: Time, Cost and Quality. And has responsibilities of Design, Construction, Management, Operation, Funding

The main characteristic of a traditional procurement route is the “separation of the responsibility for the design of the project from that for its construction.”

The History of Procurement Routes:

The traditional method would consist of competitively priced, staged lump sum payments. This method became popular in the mid-1850s. The lack of co-ordination between trades such as design and build became an obstacle and lead to the decrease in popularity for the traditional method after the 2nd World War. Involving a contractor in the early stages of the project proved to be good.

Another reason that the traditional route began to fail was in 1973 – oil crisis caused major rise in fuel prices and interest rates which meant that people were prioritising quick completion to reduce cost. This led to building work commencing before some plans are complete.

red and yellow tower crane on top of building under construction

Photo by Pedro Sandrini on Pexels.com

The Process:

Preparation – creating a business case and appointing a Project Manager.

Design – Appointing the design team and beginning the design process, it is important to take time and communicate with the design and build teams as rushed plans leads to errors and conflict.

Under the traditional procurement route, design is normally completed:

  • Before competitive tenders are invited.
  • Before the main construction contract is let. But:
  • Contractor may have some design liability, where identified and contractually stipulated.

Preparing and Obtaining Tenders – finalise documentation (BOQ – bill of quantities), specifications, drawings, etc. The design must be fully prepared before the BOQ is created for pricing accuracy and fairness.

Construction Phase – assuming there are no changes, construction cost can be identified with reasonable accuracy.

To ensure good communication throughout the process, the PM should oversee the teams.

 

Advantages of traditional procurement route:

  • Has stood the test of time
  • Understood by many clients, contractors etc.
  • Client able to select the most appropriate design team
  • Client able to have direct influence, thus facilitating a high level of performance and bespoke quality in the design
  • Client can monitor and control all phases of the project
  • High degree of certainty based on the cost and specified performance before a commitment to build

High risk of disruptions and variations, especially in cost if the design is not fully prepared before the tender is obtained or the BOQ is inaccurate.

Disadvantages of traditional procurement route:

  • Design-bid-build sequence takes long period of time
  • Designers design, don’t manage
  • Contractor unable to contribute to the design.
  • No benefit from contractor’s experience while designing the project (buildability)
  • The traditional standard forms are adversarial in nature, mentality of “that’s not my job”
  • Accelerating the process by producing tender documents from an incomplete design, or inaccurate BOQ, can result in less cost and time certainty. Leads to: Variations Time and cost overrun Expensive disputes
  • Client bears the risk of design and cost (quantities)
  • Client can think bid is a lump sum (therefore final cost) but is still vulnerable to claims
  • Strategy based upon price competition, which can result in adversarial relationships developing

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In other, unrelated news – I sold my house! You can see completed pictures in the gallery on my website…

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Blog Challenge 2.1 -Renovation Update

6 Month Renovation Update

In May, my family and I were given the keys to our new property in the South of Scotland. This was such a big opportunity, especially for me as it was something I had never done before. My mum and dad had renovated a couple of smaller properties in the past but this one was going to be a learning curve for us all.

We are now 6 months into the project and to follow on from my blog challenge that I did back in May, I am now doing another challenge to celebrate. I will upload this blog every Friday for the remaining 3 Fridays in November to mark our 6-month point!

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VICTORIA HOUSE PROJECT

This first blog is just a recap of what I had outlined in the beginning and comparing it to what we have actually achieved so far. Starting with…

The Bathroom

Here are some pictures of what I was aiming for in regard to the bathroom, I got a lot of my inspiration from Pinterest.

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After we moved the position of the door, I really stuck to the green and white colour palette, but I decided to keep the original wooden boards around the edge of the room after I found a picture with something similar and thought it looked really nice. We did tile a small part of the wall behind the shower, just for practicality really. I incorporated a small line of patterned tiles to break it up slightly, if you look closely you can see a little shiny blue tile that has a little swirl in the middle which was the main reason I chose those tiles because I thought it was fair cute.

The bath suite that we chose was a P-style bath, mum and dad wanted a free-standing bath, which I liked but I preferred the P-style because I just felt it fitted the room better and was cheaper! Win, win.

The Bedrooms

At first, we believed that the bedrooms were all going to be plain magnolia with the original skirting boards and doors painted white. We mostly have stuck to this, but we are going to wallpaper one wall now.

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The Chosen Wallpaper

Additionally, due to the actual struggle of stripping the really thick, embossed, floral wallpaper from the middle bedroom, we decided to leave one wall covered. After painting over it I am soooo glad we decided to leave it because it blends in so nicely with the room, it’s so subtle and just adds a bit of a feature to the room.

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Now most of the work upstairs is complete, bar a bit of painting and wallpapering to do, we moved to the downstairs…

The Kitchen

Whilst we were working upstairs, we were waiting on the plans coming through for the downstairs. If you have read my blog 6-months ago you will have seen the draft plan I made for the changes to the layout of the house, where we planned to knock the kitchen wall down to create a kitchen/diner, I also planned on creating an ensuite upstairs but we decided against it because it just took up too much space and made the bedroom sizes quite awkward. We have put an additional toilet room downstairs in the utility.

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Currently, we have had the planning permission accepted and the wall knocked down with a supporting beam in place. As well as this, we have bought the kitchen from Homebase, French Shaker style in an eggshell blue colour.

It’s going to look lush when it’s built, just waiting on the boiler to be installed before we assemble the units completely.

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The Utility/Lean-to

We settled on bricking up the porch and put in a back door and window, so it’s came together well. Next to the porch is the utility room and like I mentioned previously, we decided to use the space to install a small toilet and sink area. In the remaining space, we have a couple extra kitchen units to put in.

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Sitting Room

This room needs very little work, we have been using it as a bit of a storage room until we complete some more of the work downstairs.

Overall, we have completed most of the major work, except the boiler which should be done in the coming weeks, and then we just have painting and decorating left to do! On Friday I will be uploading my next blog which reviews our budget. Thank you for reading this update, there are more pictures in my website gallery and on my Instagram page: @huntersparkdesign

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Summary of Scope & Project Definition

This weekly upload is going to be a study blog, written to help me revise my course, Project Management BSc. Hopefully, it will also create a good overview for anyone else looking to study the same thing.

According to the APMBoK 6th edition, “Scope comprises the totality of the outputs, outcomes and benefits and the work required to produce them”. Simply put, the scope is the entirety of a project, from the beginning to the end of project, what it comprises of and the benefits realised after its completion.

Scope management is the process that is used to control the outputs and outcomes and identify the benefits. “Scope management is the process whereby outputs, outcomes and benefits are identified, defined and controlled (APMBoK 6th)”  

Without scope management, a project is at risk of scope creep, whereby the project exceeds its intended criteria and therefore increasing in cost, time, disputes, quality, etc. and can ultimately cause the project to fail. 

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Instagram -@huntersparkdesign

There are 6 steps to defining a project: 

  1. Requirement management – this involves assessing, capturing and documenting the needs and objectives that are required by the stakeholders.
  2. Defining the project scope – to do this you need to confirm the key aspects of the project, such as, project objectives, deliverables, milestones, technical requirements, limits and exclusions and reviews with customer.
  3. Determining the Priorities – essentially you will need to establish what areas within the project are critical and which can be compromised if necessary. E.G. time, cost or quality. These priorities should be made clear within the development phase but can change throughout the life cycle. 
  4. Create a Work Breakdown Structure – a WBS is a hierarchical outline (map) that identifies the work elements involved in a project. This is a helpful way to plan a project because you can use it to break down the scope. It also helps manage plan, schedule, and budget as well as defines communication channels and assists in coordinating the various project elements.The lowest level in the WBS is the work packages.
  5. Integrating the WBS with the Organisation – You can use an Organisational Breakdown Structure (OBS) to do this. An OBS shows how an organisation is going to manage its work responsibility within the project.
  6. Coding the WBS for the Information System – this highlights the levels and organisational levels of the WBS, it’s work packages, and budget and cost elements.

 

The Responsibility Matrix

Using the WBS and OBS you can construct a Responsibility Matrix, RAM. A RAM is used to allocate the work packages to people, organisations or 3rd parties. A RAM can include information such as who is responsible, should be consulted or informed about certain tasks.

https://www.apm.org.uk/body-of-knowledge/delivery/integrative-management/organisation/

Thank you to the continued support on this blog series 🙂

 

Golden Gate Bridge Example

Simplified Business Case for the Golden Gate Bridge

This weekly upload is going to be a study blog, written to help me revise my course, Project Management BSc. Hopefully, it will also create a good overview for anyone else looking to study the same thing.

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In response to my last post, I wanted to share a rough draft of a simple business case. Using my University’s description of a business case, I have tried to come up with something similar, referring to the Golden Gate Bridge. I haven’t addressed all the key elements of a business case here, because I either struggled to find any research on that specific part or I wasn’t confident enough with my answer. If anyone does have any good feedback, that would be helpful. However, this is just my take on a quick task, nothing serious, perhaps as my course matures, I will be able to return to it and extend it a bit further.

Strategic Case: A solution is needed to connect the almost 2-mile gap between Marin County to San Francisco as there was no way round at the time.

Options Appraisal:

  Option Cost
1. Do nothing Minimum
2. Build a Bridge (recommended) Maximum
3. Invest in Boats Average

Expected Benefits and Disbenefits:

Option Benefits Disbenefits
Do nothing Saves cost, saves resources No direct link between Marin County and San Francisco Bay
Build a Bridge Direct link between Marin County and San Francisco Bay, opens up employment (on construction and between the 2 areas), more roads leading to less congestion. High cost, high risk construction, disapproval from business owners and civic leaders, ruin the view of the bay, obstruct ships, requires maintenance
Invest in Boats Increased access across the bay, increased revenue and employment for the shipping business Requires maintenance, will not allow car access between the 2 areas

Financial Case:
Engineers estimate of $25-30 million to construct.

$35 million in bank bonds granted

Bank of America President Amadeo Giannini, who provided a crucial boost by agreeing to buy $6 million in bonds in 1932. https://www.history.com/topics/landmarks/golden-gate-bridge

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Photo by Alexander Mils on Pexels.com

Risks of Building the Bridge:

  1. Hazardous working conditions – impacts the workers and their family’s health and wellbeing
  2. There was risk of insufficient funding after the Great Depression – may cause the bridge to remain uncompleted, or could lead to a delay in the project
  3. Earthquake – after the 1906 San Francisco earthquake there would be worries of insufficient measures to avoid bridge collapse, which would incur additional costs and endanger lives.

Time Scale:
Drawings for the bridge were submitted in 1921 and were passed in 1933. Building work was completed in 1937.

Benefits realised after one year “June 30, 1938: During the first full fiscal year, the Golden Gate Bridge serves 3,892,063 motor vehicles, carries more than 8,000,000 passengers, and in excess of 400,000 pedestrians walked the sidewalks (GGBHD Annual Report FY37/38).”

According to http://goldengatebridge.org/research/GGBTraffToll.php, the toll for the bridge was 50 cents each way in 1937, so according to above study, in the first year the bridge would have roughly earned $1,946,031.50 in it’s first year.

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If you have any tips on how to improve this, please let me know!

OTHER SOURCES

http://goldengatebridge.org/research/dates.php

http://goldengatebridge.org/research/GGBTraffToll.php

https://www.history.com/topics/landmarks/golden-gate-bridge

My Experience – Buying a House at 19

Buying a House at 19

“Buying a house is kind of like catching a train, it’s probably going to get delayed.”

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At the beginning of 2019 I made the decision to invest in a renovation project, I was inspired by my parents who have bought and sold properties in the past. I had been feeling a bit useless and life was at a standstill working a full-time job just felt like I was living the same day repeatedly, I needed something to fulfil my goals and regain my energy. Although, I didn’t want to undertake this huge opportunity single-handed, so I came to an arrangement with my parents, this deal being that they would loan me the money to buy and renovate a property, with their help, they would get the entire loan back and any profit would be split between us dependent on different factors, such as:

  1. Time spent working on the house
  2. Work effort
  3. I contributed around 5% of the overall budget, therefore, my share of the profit will be considerably smaller

Fortunately, they were in the financial position to buy the house free of any kind of mortgage or loan for me which saved us a lot of time and hassle meaning that we could jump straight into house hunting. Regardless of my parents help, I made sure that the house was put in my name, I am so thankful for everything they’re doing it was such a big deal to me because it felt like the beginning of something positive in my life. We viewed multiple properties in our local area but none of them quite buttered our bread and we left most viewings feeling rather flat. This being said, it was a blessing in disguise as if it was not for these shortcomings, we never would have found this house

We went to view this house after seeing it online, it simply ticked all the boxes and going to view it was the icing on the cake. My dad in particular just loved everything about it, and so did I! We didn’t hang around, as soon as we finished, we were in the solicitor’s office putting in an offer. Sadly, this offer was at the top of our budget and got rejected, but it didn’t knock us, we wanted this house so badly that we dipped into the renovation budget to accommodate a slight rise in our offer which, thankfully, bagged us the house!

Since then, I have been in and out of the solicitor’s office. I honestly don’t like it, something about walking into a room of extremely wealthy, old people just feels daunting, like they’re totally judging me, and I can definitely feel it sitting in the waiting room. In the office isn’t much better either, I like my solicitor, she is friendly, of course she is (we are paying her…!) but she just talks with so many words that I have to pretend to understand, she could honestly be talking another language and I’d still sit and agree with her as if I was fluent! I’m glad to have my parents sat on either side of me, I hope they’re more clued up than me. One thing I did understand however, was that there was a discrepancy with the plans, which means we have a problem.

Whilst we waited for the sale to process, I decided to start up this blog. I thought that it could be a clever tool to track the progress we make, as I hope to do this again in the future, it would really benefit me to have something to look back on and help me to make better choices in the future. Adding to this, it’s a way to keep me entertained and most importantly, focused, while I haven’t got any jobs to do. It has been harder than I had thought it would be, keeping views and likes consistent and thinking of things to upload has been like a job in itself, not to mention that Instagram is a dog eat dog world, one minute I have 100 followers the next 90 and 80, and so it goes on! It’s hard to keep up sometimes, but overall, I enjoy it a lot. @huntersparkdesign

Hunter and Spark, Family Property Development since 2019

We were updated by the solicitor that they were resolving the issues with the plan and that it should not be much longer before the keys are in our hands, it’s annoying that we didn’t get them a week ago like we had first thought, I can tell my dad is eager to make a start, but as is life.

Aside from my blog, in the meantime I have been making budget plans, drawn some pictures, a spreadsheet timetable (currently with no jobs or times on it yet but I have the layout!) and looking at home inspo on Pinterest to get me prepared for the big day! I think that we will possibly be looking at another week before I can pick the keys up but that’s okay, good things come to those who wait, blah blah. As soon as those keys are in my hands, I’m going to be in there measuring it up and taking photos, I can’t bloody wait.

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Also, another thing I am buzzing about is that summer is almost here!!! 🙂

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