What are the challenges of construction management and how
does Daoust Construction approach them?
A guaranteed cost does not exist when the owner begins construction
Trade lump-sum contracts covering nearly 90% of the project value
are awarded, which will confirm the established budget. A lump-sum
general contract is not a guarantee of a maximum price; it is
often the starting price, followed by extras and impact and delay
Costs for all units of work may be established before construction
begins, but with the penalty of extending the schedule.
Lump-sum contracts for most trades are awarded early in accordance
with the project schedule. This may require splitting an all-inclusive
contract into smaller or phased contracts.
There are few trained construction managers who understand
the team relationship required by the construction management
Daoust Construction has specialized in construction management
since 1974. Most of our projects are delivered with construction
management. In addition, one of the principals of the company
is directly involved as the project director on each job.
The close involvement of a company decision maker speeds up the
process and stengthens our ability to motivate trade contractors
Construction management replaces the general contractor and
subcontractors with an array of trade contractors. This may be
a drawback because it substitutes an array of prime contracts
for the single contract between the owner and the general contractor.
Our approach to managing trade contractors is similar to the approach
used by general contractors. We often issue all trade contracts on behalf of our clients
as would be done by a general contractor
or constructor and make payments directly to the trade
contractors. This permits the client to deal with Daoust Construction
rather than a maze of trade contractors. An array of prime contracts
can be an asset if one of the contractors fails or is replaced.
In this situation, an array of contracts limits the effects to
one trade rather than to the overall general contractor.
The multi-prime nature of construction management, by requiring
every contractor to bid and furnish a bond, eliminates a sizable
segment of the industry contractors who cannot obtain bonding.
There are many alternatives to bonding that are easily accessible
to most trade contractors. These alternatives permit smaller trade
contractors to provide performance security in a form that can
be more advantageous than bonding. This flexibility also saves
money by eliminating the layering of bonds commonly provided by
subcontractors to the general contractor.
Daoust Constructions knowledge of market conditions and
reputable trade contractors, coupled with the experience of consultants
and the owner, is sufficient to identify risky trade contractors
who should be required to provide an acceptable form of performance
security. All interested trade contractors are required to submit
a pre-qualifying document prior to bidding for the purpose of
risk evaluation. Performance security will be obtained whenever
The design team, if behind schedule, can greatly affect the
construction schedule and the completion date. This situation
does not exist in the general contracting process, where all the
documents are ready before construction starts.
After having produced a construction schedule, Daoust Construction,
through consensus, will establish dates for having the bid packages
ready and will monitor progress.
Sometimes, when design schedules slip, the readiness of bid documents
is jeopardized. General contractor bids can be considerably over
budget, and this situation is not easily corrected when the bid
documents are 100% complete. Construction management has the flexibility
to allow stages of the work to begin and proceed while the balance
of the documents are being completed.
A typical administrative problem is getting timely cost reports
and forecasts in order to make necessary decisions or adjustments.
Daoust Construction provides detailed sub-job reports and prepares
budget forecasts at least monthly. Cost backups are also provided
with every progress billing.
Trade contractor performance needs to be monitored.
To protect a project against incompetent trade contractors, Daoust
Construction prepares a list of preferred bidders (published for
pre-qualification or expression of interest). We communicate the
projects guidelines at orientation meetings. We give immediate
notice when a trade is not proceeding satisfactorily. We have
adapted specific Supplementary General Conditions clauses to increase
our effectiveness in this regard. We maintain accurate minutes
of meetings and a daily logbook.
Navigating through the maze of drawings, sketches, site instructions
and change orders can be difficult.
Ultimately, construction management requires no more documents
than any other project delivery method. There are, however, more
updates to the documents. We control these updates and ensure
that all parties are working from the latest version. We maintain
an accurate filing system at our main office and the site office.
The project manager, project co-ordinator or chief estimator
will review and process all shop drawings and design documents
as they are updated.
Back to FAQs