MACMILLAN BUILDING AND SURVEYING SERIES

Series Editor: IVOR H. SEELEY

Emeritus Professor. The Nottingham Trent University

Advanced Building Measurement, second edition Ivor H. Seeley

Advanced Valuation Diane Butler and David Richmond
Applied Valuation Diane Butler
Asset Valuation Michael Rayner
Building Economics, third edition Ivor H. Seeley
Building Maintenance, second edition Ivor H. Seeley
Building Maintenance Technology Lee How Son and George C. S. Yuen
Building Procurement Alan E. T umer
Building Project Appraisal Keith Hutchinson
Building Quantities Explained, fourth edition Ivor H. Seeley
Building Surveys, Reports and Dilapidations Ivor H. Seeley
Building Technology, ftfth edition Ivor H. Seeley
Civil Engineering Contract Administration and Control, second edition
Ivor H. Seeley
Civil Engineering Quantities, ftfth edition Ivor H. Seeley
Commercial Lease Renewals Philip Freedman and Eric F. Shapiro
Computers and Quantity Surveyors Adrian Smith
Con~icts in Construction - Avoiding, Managing, Resolving Jeff Whitfield
Constructability in Building and Engineering Projects Alan Griffrth and
Tony Sidwell
Construction Contract Claims Reg Thomas
Construction Law Michael F. James
Contract Planning and Contractual Procedures, third edition
B. Cooke
Contract Planning Case Studies B. Cooke
Cost Estimation of Structures in Commercial Buildings Surinder Singh
DeSign-Build Explained David E. L. Janssens
Development Site Evaluation N. P. Taylor
Environmental Management in Construction Alan Griffrth
Environmental Science in Building, third edition R. McMullan
European Construction - Procedures and Techniques B. Cooke and G. Walker
Facilities Management - An Explanation J. Alan Park
Greener Buildings - Environmental Impact of Property Stuart Johnson
Housing Associations Helen Cope
Housing Management Changing Practice Christine Davies (editor)
Information and Technology Applications in Commercial Property
Rosemary Feenan and Tim Dixon (editors)
Introduction to Building Services, second edition Christopher A. Howard
and Eric C. Curd
Introduction to Valuation, third edition David Richmond
Marketing and Property People Owen Bevan
Principles of Property Investment and Pricing, second edition
W. D. Fraser
Project Management and Control D. W. J. Day
Property Finance David Isaac
Property Valuation Techniques David Isaac and Terry Steley
Public Works Engineering Ivor H. Seeley
List continued overleaf
List continued from previous page

Quality Assurance in Building Alan Griffith

Quantity Surveying Practice Ivor H. Seeley
Recreation Planning and Development Neil Ravenscroft
Resource Management (or Construction M. R. Canter
Small Building Works Management Alan Griffith
Structural Detailing, second edition P. Newton
Sub-Contracting under the JCT Standard Forms o( Building Contract
Jennie Price
Urban Land Economics and Public Policy, fffth edition
P. N. Balchin, J. L. Kieve and G. H. Bull
Urban Renewal - Theory and Practice Chris Couch
1980 JCT Standard Form o( Building Contract, second edition
R. F. Fellows
Contract Planning
and Contractual
Procedures

B.Cooke
M.Sc., C Eng., M.I.CE., M.CI.O.B., F.R.I.CS.
Principal Lecturer in Building.
Uverpool John Moore's University

Third Edition

M
MACMILLAN
© B. Cooke 1981, 1984, 1992

All rights reserved. No reproduction, copy or transmission of

this publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or
transmitted save with written permission or in accordance with
the provisions of the Copyright, Designs and Patents Act 1988,
or under the terms of any licence permitting limited copying
issued by the Copyright Licensing Agency, 90 Tottenham Court
Road, London WIP 9HE.
Any person who does any unauthorised act in relation to this
publication may be liable to criminal prosecution and civil
claims for damages.

First edition 1981

Reprinted (with corrections) once
Second edition 1984
Reprinted once
Third edition 1992
Published by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire R021 2XS
and London
Companies and representatives
throughout the world

ISBN 978-0-333-57760-8 ISBN 978-1-349-12964-5 (eBook)

DOI 10.1007/978-1-349-12964-5
A catalogue record for this book is available
from the British Library.
12 II 10 9 8 7 654
03 02 01 00 99 98 97 96 95

Series Standing Order

If you would like to receive future titles in this series as they are published, you can
make use of our standing order facility. To place a standing order please contact your
bookseller or, in case of difficulty,write to us at the address below with your name and
address and the name of the series. Please state with which title you wish to begin your
standing order. (If you live outside the United Kingdom we may not have the rights for
your area, in which case we will forward your order to the publisher concerned.)
Customer Services Department, Macmillan Distribution Ltd
Houndmills, Basingstoke, Hampshire R021 2XS, England
CONTENTS

1• THE PLANNING PROCESS 1

1.1 The Planning Stages Involved in the Construction Process 2
1.2 Pre-tender Planning stage 4
1.3 Pre-contract Planning Stage 4
1.4 Contract Planning 5

2. PRE-TENDER PLANNING 8
2.1 Tendering Policy - The Decision to Tender 8
2.2 Initial Pre-tender Meeting 11
2.3 Site Visit Report Information 17
2.4 Objectives of Method Statements 24
2.5 Examples on the Preparation of Method Statements 27
2.6 Sources of Estimating Information 39
2.7 Obtaining ~otations from Subcontractors and Suppliers 42
2.8 Build-up of the Estimate 45
2.9 Build-up of Contract Preliminaries 50
2.10 Adjudication of an Estimate 58
2.11 Analysis of Tender Performance and Bidding Theory 61
2.12 Analysis of Tender Performance - Worked Example 66

3. PRE-CONTRACT PLANNING 73
3.1 Pre-contract Arrangements Prior to Commencing a Project 73
3.2 A. Organisation Structure for a Project 78
B. Organisation Structure for a City Centre Development 81
3.3 Site Layout Planning 88
3.4 Placing of Orders for Subcontractors and Suppliers 93
3.5 Requirement Schedules 100
3.6 The Master Programme 109
3.7 Budgetary Control Procedures III
3.8 Cash Flow Analysis - Calculation 120

4. CONTRACT PLANNING TECHNIQUES 128

4.1 Planning Techniques Available to the Contractor 128
4.2 Programme Sequence for a Housing Contract 141

v
 4.3 Programme Sequence for the Erection of Twenty-four
Reinforced Concrete Columns 147
4.4 Short Term Programme for a Laboratory Block 149
4.5 Network Programme for a Bridge Project 153
4.6 Network Analysis - Lead and Lag Terminology 163
4.7 Network Analysis - Crash Cost Application 168
4.8 Precedence Diagrams - Terminology and Relationships 173
4.9 Precedence Networks - Case Study 180
4.10 Cost Envelopes - Principles 185
4.11 Cost Envelope - Worked Example 189
4.12 Ladder Diagrams and Labour Resource Allocation 196
4.13 Ladder Diagram and Resource Allocation - Case Study -
Reinforced Concrete Column Sequence 196
4.14 Time Cost Optimisation Techniques and Least Cost
Scheduling 196
4.15 Time Cost Optimisation Example Project Information 202
4.16 Approach to the Analysis of the Problem 204
4.17-20 Stages of Analysis 204
4.21 Report to Management 211

5. SHORT TERM PLANNING PROCEDURES AND PROGRESS RECORDING 213

5.1 Short Term Contract Planning 213
5.2 Monthly Site Meetings 219
5.3 Weekly Planning Techniques 221
5.4 Weekly Site Reports and Progress Recording 224
5.5 Weekly Cost Control 229
5.6 Materials Control and its Relationship to Short-Term
Planning 236

6. FUNDING FOR SPECULATIVE CONTRACTS 243

6.1 Cash Funding and the Speculative Developer 243
6.2 Assessment of Project Feasibility 244
6.3 Pattern of Cash Funding Requirements for a Speculative
Development 247
LIST OF EXAMPLES
Chapter Description Section Figure
2 Initial Tender Meeting Procedures 2.2
2 Pre-tender Check List 2.2 2.1
2 Site Visit Report 2.3 2·3
2 Method Statement Proforma 2.4 2·4
2 Method Statement for Site Works Project 2.4 2.5
2 Method Statement for Concrete Culvert 2.5 2.8
2 Method statement for Factory 2.5 2.9
2 Sources of Estimating Data 2.6 2.10
2 Build-up of an Estimate -All-in Rate 2.8
2 Analytical Estimate 2.8 2.11
2 Build-up of Contract Preliminaries 2.9 2.12
2 Bidding Theory 2.11 2.13
2 Analysis of Tender Performance 2.12 2.14
3 Pre-contract Planning Meeting 3·1
3 Organisation structure for a Project 3·2
3 Organisation structure for a City
Development 3·2 3· 3
3 Site Layout Planning - Considerations 3.3
3 Site Layout Plan - Office Block 3.3 3.6
3 Site Layout Plan - Office Development 3· 3 3.7
3 Site Layout Plan - Central City
Development 3.3 3.8
3 Subcontractors Questionnaire 3·4 3.9
3 Requirement Schedules 3.5 3.10-16
3 The Master Programme 3.6 3.17
3 Budgetary Control Procedures 3·73·18-23
3 Cash Flow Calculation 3.8 3.24-26
4 Planning Techniques Available to the
Contractor 4.14.1-8
4 Programme for a Rousing Contract 4.2 4.9-12
4 Sequence Study for Reinforced Concrete
Columns 4.3 4.13-14
4 Programme for a Laboratory Block 4.4 4.15
4 Network Programme for a Bridge Project 4.5 4.16-20
4 Lead and Lag Example 4.6 4.21-27
4 Crash Cost Example 4.7 4.28-32
4 Precedence Network Relationships 4.8 4.33-41
4 Precedence Network Case Study 4.9 4.42-44
4 Cost Envelopes - Principles 4.10 4.45-49
4 Cost Envelope-Worked Example 4.11 4.50-53
4 Ladder Diagram Principles 4.12 4.54-55
4 Ladder Diagram Case study 4.13 4.56-60
4 Time Cost Optimisation Principles 4.14
4 Time Cost Optimisation - Worked Example 4.15 4.61-65
5 Short Term Planning - Five Weekly
Programmes 5.1 5.1-4
5 Monthly Site Meetings - Agenda 5.2
5 Weekly Planning Procedures 5.3 5.5-6
5 Weekly Report and Progress Recording 5.4 5.7-8
5 Weekly Cost Control Procedures 5.5 5.9-13
5 Materials Control System for a Factory
Project 5.6 5.14-18

vii
ACKNOWLEDGEMENTS

The author wishes to acknowledge the encouragement received from

Professor I.H. Seeley for his guidance and advice during the
editing. I am also indebted to Professor W.B. Jepson for his
initial enthusiasm in encouraging me to write the book together
with his advice on its content. The author is indebted to
Alice Roberts for so ably typing the manuscript together with
Malcolm Stewart for assistance during publication. MY special
thanks are due to my management students at Stockport College of
Technology for their participation in the many worked examples
during college lectures.

viii
PREFACE

The aim of the book is to provide a systematic appraisal of the

planning procedures and management decisions undertaken during
the pre-tender stage, pre-contract and contract planning stage.
This includes considerations relating to the decision to tender
and the tender adjudication. Procedures outlined follow the
recommendations of the Code of Estimating Practice as set out by
the Chartered Institute of Building.

Examples of the various stages of tender preparation are out-

lined from procedures utilised by both medium and large-sized
contracting organisations. The format of the pre-tender meeting,
site visit report and examples of method statements are illustrated.
Sources of estimating information are outlined together with
procedures for obtaining quotations. A check list for contract
preliminaries is indicated and the points to be considered at
tender adjudication outlined. The controversial matter of bidding
strategy is outlined in principle and a method of analysing tender
performance presented.

The planning considerations prior to convening a contract are

outlined and a number of examples are presented on site layout
planning. Examples are shown of various requirement schedules
which form an important part of the planning process and assist
in calling information forward from both the architect and other
consultants. Budgetary control forms an essential part of the
pre-contract planning procedures. Examples of various types of
budgets are discussed together with a cash flow assessment for a
contract and considerations for improving the cash flow situation.

The various types of planning techniques available to the

contractor are illustrated together with examples of sequence
studies for individual trade gangs. Network and precedence
diagrams are outlined in principle together with examples showing
the application of lead and lag terminology and crash costing
techniques. The application of monthly planning and weekly
planning techniques are shown together with their relationship to
site meetings. The importance of progress recording and the
preparation of accurate weekly reports as an aid to control are
discussed. An example is presented of a weekly pre-target based
cost system together with the basic principles of a planning
orientated materials control system.

The reference will provide prospective site management personnel

with an insight to all stages in the planning cycle. The require-
ments of the Chartered Institute of Building - Final Part II
building production paper syllabus are covered together with

ix
Contract management papers in the Institute of Quantity Surveyors
examinations. Undergraduates on building degree courses will
also find the reference useful as an insight into contractual
procedures.

The third edition of this book has been updated to include

changes in the approach to the assessment of contract
preliminaries - consideration for time and fixed related costs in
relation to site requirements, plant and employers' requirements.
A new chapter has been added in relation to the planning and
feasibility requirements of speculative building projects.

B. COOKE

Stockport,
Spring 1992