Chuck, a CM graduate from BSU lands an internship with a large Regional contractor.  His first position in the company is that of “Owners Representative” for a new public library project.  The City building the library hired the firm Chuck works for as CM.

At the first meeting with the City Librarian (Joan), it became very evident that she did not have any knowledge in how a project gets designed or built.  During the meeting, there were many different questions she needed to answer before Chuck could get to work with the many preconstruction service tasks required.  Questions such as:  Where would the new library be located?  Would the library district need to buy land or could they use land they already owned?  How big should the new library be?  How would most visitors get to the new library – walking or car?  How would they pay for the library?

Chuck realized he needed to develop a summary or a checklist of those activities to guide Joan as the “owner” through the project inception and throughout the life of the project.

Problem 1 (25 points):

Develop a ‘detailed’ checklist for Joan which includes the early project life cycle phases (i.e. concept to bid).   This checklist may be organized by Project Phases.  Each phase could include a list of  ‘responsibilities/decisions for the owner’.  When necessary each decision could include factors or criteria to consider.

Include a brief description of each activity included.  Insure the checklist provides the order in which the general categories should occur.

SCENARIO (continued)

As Joan worked through her Owner checklist, it became apparent from the early planning considerations that the library project was feasible.  The library board thought the project would pass the required vote on the bond issue two months from now.  This would be an important step needed to secure financing of the project.

It was now time to move from the initial concept to consider procurement strategies.  Joan called Chuck, her point of contact for the CM company hired by the library board in CM agency relationship.  She liked the ‘check list’ Chuck had provided but was confused about several of the items noted on the list.  In particular, under the item titled, Select Procurement Method, Joan did not really understand the various options that were presented.

She asked Chuck for clarification and he responded:

In construction Joan, you typically have three options for your procurement strategy: Design-Bid-Build (DBB), Design-Build (DB), and Construction Management at Risk (CM).  DBB is a very common way to deliver a construction project using a traditional organization.  DBB calls for a complete design before site work begins and then a single general contractor assumes all the responsibility for constructing the entire project usually on the terms of a lump-sum contract.  I guess that you would like to fast track your project delivery.  Both Design-Build and CM allow this process.

This answer did not really help Joan understand contracting enough to make a decision, so she asked Chuck if he could prepare a detailed comparison of the alternatives.


PROBLEM 2 (25 points):

Imagine you are Chuck.  Write a memorandum w/ appropriate attachments for Joan including the following information:

  • List the pros and cons of each of the three contracting strategies.
  • Which contracting strategy do you recommend to Joan?  Why?
  • Should Joan use competitive bidding or contracts on a negotiated basis?  Why?
  • Should the agreement with the contractor be a lump sum, cost plus or a unit-price contract?  Why?
  • Draw a diagram showing the organization of the management and contracting relationships for DBB, DB, and CM.


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Order Management