Systech insights edition-Mark Woodward Smith

insights
sYSTECH
EDITION 1
SystechI N T E R N A T I O N A L
SHARING OUR
Global expertise
& Local knowledge

Welcome to Systech Insights
We are delighted to welcome you to the first edition of Systech
Insights in which we share our expertise and opinions on a range
of topical issues.
The articles have been written by staff located across the regions
in which we operate and they demonstrate our breadth of
experience in a range of services and sectors.
Systech International has been established for over 20 years
and, in this time, we have become the world’s leading provider
of consultancy services to contracting organisations, supporting
them in the delivery of projects on time and to budget.
Our integrated approach allows us to offer high quality multi-
disciplinary managed services from a single business, avoiding
the abortive work and communication problems that often arise
when using multi-party advisors.
Innovation is also very important to us and our services uniquely
include visual communications and apps.
We hope you enjoy the read and we, and the contributors, would
be delighted to receive your feedback.
Stephen and Mark
Stephen Rayment and Mark Woodward-Smith
Group Managing Directors

SYSTECH INSIGHTS ▶ edition 1 1
insights
sYSTECH
EDITION 1
Two Wrongs Don’t Make a Right... 2
Nigel Oliver —RegionalDirectorUSA
Innovations in Winning Work and Resolving Disputes 4
Leigh Gibbs —ManagingDirectorVisualisation
Earned Value Management 6
Ricardo Delarue — CountryManagerBrazil
A Legal Minefield? Adjudication Down Under 9
David Finlayson — DirectorofWAandNTAustralia
A Contract Manager Abroad 12
Eric Webb — RegionalDirectorKorea
Legal Services for the Modern Age 14
Rebecca Redhead — DirectorLegalServices
An Introduction to Period Analysis 16
Jeff Perry — DirectorofDisputes
Construction the New Generation of Nuclear Power Plants 20
Gavin Maxwell-Hart — OlkiluotoNuclearProject3,HeadofContractManagement
Global Claims: a Necessary Evil? 22
Scott Park — DirectorAbuDhabi
Project Record Collection goes Mobile 24
Geoff Ansell — DirectorofGlobalMarketingandTraining
TOP TIPS: NEC Success 26
Richard Morris —DirectorExpertServices

2 SYSTECH INSIGHTS ▶ edition 1
N
o one likes a project that
has been delayed. For the
contractor, delay typically
means extended costs as-
sociated with being on the
project longer than envis-
aged. For the owner, it means the loss of
use of the facility that is being construct-
ed, with a resulting loss of income.
Most modern construction contracts
contain clauses which attempt to incentiv-
ise both parties to reach a common goal in
an agreed timely fashion. One such weapon
is that of liquidated damages.
In construction contracts, liquidated
damage clauses prescribe in advance the
compensation the owner will accrue if the
contractor fails to perform. The advantage
of such a clause for the owner is that he
knows the amount he will be entitled to
in the event of delay. Correspondingly for
the contractor, he knows in advance what
the financial risk may be should the works
be delayed. By providing some certainty to
both parties, such a provision avoids the
expense which would otherwise be incurred
in proving or disproving the actual amount
of damages in court or through arbitration.
Whether such a contractual provision is
OILREFINERY,TEXAS,USA
Two wrongs don’t
make a right...Nigel Oliver
Regional Director,
USA
an enforceable liquidated damages provision
or an unenforceable penalty is a question of
law. In most common law jurisdictions, when
determining whether a liquidated damages
clause is enforceable, courts will examine the
following:
Whether the harm caused by the prospective
breach of the contract is impossible or difficult
to estimate; and
Whether the amount of liquidated damag-
es called for is a reasonable and genuine
pre-estimate of the probable loss.
Typically, if either element is found to be
lacking, the liquidated damages clause is
unenforceable.
In the United States, some owners have
attempted to address these factors by drafting
the liquidated damage provision to specifically
state that it is not intended to be a penalty. To
the extent that the provision has been negoti-
ated, this language may be of some assistance
to the owner in attempting to prove the parties'
intent. It should be emphasised, however, that
such language is not binding on the court.
In providing such a clause, both the contrac-
tor and owner have expressly stipulated in the
contract the amount of damage to be recovered
in the event of delay caused by the contractor,
regardless of what the actual damages subse-
quently incurred by the owner may be. Thus
an owner could conceivably recover far
greater compensation than it has ulti-
mately incurred. It should be noted that,
while such a position is true in English

or do they?
law, some international jurisdictions allow for
a reduction in liquidated damages where it can
be shown they are excessive in comparison to
the actual loss suffered.
In most construction contracts the mecha-
nism by which a contractor can avoid its liabil-
ity to liquidated damages for delay is extension
of time. Contracts also go on to state which
areas of activity either party will be respon-
sible and at risk for. Most contracts include
for a contractor’s entitlement to
an extension of time for delays
caused by the owner. For
example, the FIDIC Condi-
tions of Contract state that
the contractor may be enti-
tled to an extension of time
if there is “any delay, imped-
iment or prevention caused by
or attributable to the Employ-
er, the Employers Personnel,
or the Employers
other Contractors
on site”.
It is becom-
ing increasing-
ly common in
c o n s t r u c t i o n
contracts that
a prerequisite
for invoking the
extension of time
clause is that
the contractor
must give notice.
An example of this is Clause 20.1 of the FIDIC
Contract which states:
“If the Contractor considers himself to be enti-
tled to any Extension of the Time for Completion
and/or any additional payment, under any Clause
of these Conditions or otherwise in connection with
the Contract, the Contractor shall give notice …. The
notice shall be given as soon as practicable, and
not later than 28 days after the Contractor became
aware, or should have become aware, of the event
or circumstance.
If the Contractor fails to give notice of a claim
within such period of 28 days, the Time for Comple-
tion shall not be extended, the Contractor shall not
be entitled to additional payment, and the Employ-
er shall be discharged from all liability in connec-
tion with the claim.”
The wording of Clause 20.1 leaves no doubt
as to the consequences of a lack
of timely notice. The right to an
extension of time and/or to addi-
tional payment is forfeited.
However, what happens when
the delay has been caused by
the owner? Do two failures, one
by the owner in hindering the
contractor’s performance, and
one by the contractor in failing to
give notice of said delaying event,
give the owner an entitlement to
recover liquidated damages in
circumstances where it has clearly
delayed the works? Do two wrongs
make a right? ◉
▶ The idea that two wrongs make
a right may sound inequitable. This
proposition has been the cause of
much debate and conflicting court
decisions and these will be explored
in the second part of this two-part
article, in edition 2 of SYSTECH
INSIGHTS.
nigel.oliver@systech-int.com

Innovations in
Winning Work
and Resolving
Disputes
Leigh Gibbs
Managing Director,
Visualisation
O
K, before anyone points it out, I realise the irony of a piece about
the virtues of multimedia visualisations over the written word
being communicated via the written word; if it were possible
in any other way, then believe me, I would do it.
I see two major areas where visualisation can be used in the
construction process: at the beginning when you are selling
the dream and at the end when things have not gone to plan.
Our in-house visualisations team, working in conjunction
with our construction professionals, is developing an
excellent track record in both areas.

Winning Work
The conclusion of a tender process will often see
three or four contractors given a final chance
to impress the panel at an interview. This is
the time to roll out the big guns - traditionally
your best speaker and key members of the team
armed with a PowerPoint presentation.
Until a year or so ago we would have supplied
a short video presentation to complement
this process. PowerPoint is fine if you are
introducing your site team but what about
traffic management, the benefits of vari-
ous phasing options or that special off-site
prefabrication process that is going save a
fortune and is key to you winning the job?
This is where we step in and help explain
these issues as quickly and clearly as possible
using multimedia.
As technology marches on, so do the tech-
niques that we use to win work for our clients.
Each job is different and so is the approach we
take. We develop custom iPad applications that
cover all aspects of the job from profiles for
the site team to interactive models showing the
construction phasing. The proof of the pudding
is in the eating and on major bids our success
rate is over 50%.
Dispute Resolution
The resolution of a construction dispute often
involves claims for delay and disruption that
require extensive expert input and the expend-
iture of significant sums.
One of the common ways an expert will iden-
tify the delaying or disrupting activities will
be through a graphical representation of the
as-built and as-planned critical path networks.
This is a very complex process that needs to
take account of the vast number and relation-
ship of the activities as well as issues relating
to concurrency, re-sequencing, mitigation and
acceleration. Animation can assist because it
has the flexibility to vividly demonstrate the
effects of each of these aspects of a construc-
tion project.
That being said, care must be taken to ensure
that the quality of the information provid-
ed to the animators is of sufficient quality
to produce reliable results, so as to avoid the
garbage in, garbage out syndrome. An example
of a case in which the trial judge criticised one
expert’s over-reliance on the flawed output
of a computer program can be seen in Skans-
ka Construction UK Ltd v Egger (Barony) Ltd
(2004) EWHC1748(TCC).
A critical question is admissibility. There is
no reason that you cannot use an animation in
court to assist your case. It has been suggest-
ed that a party’s objection to an animation’s
admissibility is likely to be akin to an objec-
tion to a part of a pleading that a party says it
cannot respond to. We mitigate any problems
by ensuring that our animations are based on
contemporary records and project information
which is available to the other party.
In mediation there are no issues regarding
admissibility and a party using an animation
has an opportunity to clearly and unambig-
uously state its case in the most favourable
light. Indeed we have successfully supported a
number of contractors in this way.
However, by far and away the most popular
use of visualisation in construction disputes
is before formal dispute resolution measures
have been instigated. This is often at the
stage when the dispute has been escalated
off-site and it is being dealt with by senior
management at head office. A carefully craft-
ed video delivered to the CEO of the other
party can do wonders. It is not confronta-
tional and offers a persuasive case which acts
as a catalyst to get the parties talking and
agree a settlement.
In addition to multimedia presentations,
we are now seeing the adoption of tablets as
a communication tool. A plethora of claim
information can be stored on these tablets
and accessed on demand and in any order. For
an expert witness this is the stuff dreams are
made of. A suitably programmed tablet can
hold and display everything that is necessary to
support an opinion, and we regularly combine
video, documents, photographs with interac-
tive models to help explain complex issues in a
compelling and easy to understand way.
The Way Forward
The advances in technology are making multi-
media presentations both affordable and acces-
sible. This, combined with a greater acceptance
of electronic technology in the construction
industry is making the use of these techniques
far more prevalent, providing a cost effective
way of communicating complex issues.
This is the future, ignore it at your peril.◉

▶ leigh.gibbs@systech-int.com

FPSOCIDADEDEILHABELA,BRAZIL
Earned Value
Management
For evaluating the overall
productivity of a project
The productivity
of labour and
equipment is one of the
major risk factors in the
success or failure of a project.
Ricardo Delarue
Country Manager,
Brazil

The Baseline Schedule
In implementing EVM, the first challenge is
the creation of the Baseline Schedule on
which the ‘planned labour units’ (normal-
ly expressed in hours) and ‘quantities to be
executedperactivity’areincludedforevery
activity of the Work Breakdown Structure
(WBS).
For example – Activity 001: ‘installation
of secondary cable trays’ has a planned
labour unit of 0.80 hour/m. This means that
the plan is to spend 48 minutes (60 minutes
x 0.80) for the installation of every metre of
secondary cable tray.
The same planned labour unit and quantity
evaluation is made for all the activities of the
WBS so that the ‘total planned hours’ to be spent
on the project can be identified. Obviously, it is
mandatorytoalignthesehoursthemomentthat
the contractor is chosen.
The Planned S Curve
Once the baseline schedule is defined, and the
planned quantities and labour units inserted for
each activity, it is possible to create a Planned S
Curve, using the formula below:
Planned Hours (PH) = Planned Quantities x
Planned Labour Units
Goingbacktotheexample,let’sconsiderthatthe
plannedquantitywas5,000mofsecondarycable
trays, so we would have:
Planned Hours (PH) = 5,000m x 0.80 hours/m =
4,000 planned hours
Doing the same exercise for all the activities of
the project, and cumulating the working hours
on a monthly basis using the planning software,
it is possible to create an S Curve for the Planned
Hours (PH). Graph 1 is an example of an S Curve
forecasting almost 250,000 working hours for an
entire project.
Usually, on a monthly basis the actual progress
(or quantities executed per activity) is recorded/
monitored. In EVM the actual progress is meas-
ured by the ‘Earned Hours’ and it is a measure of
thequantitiesinstalledmultipliedbythePlanned
Labour Units. Using EVM, the simple formula for
calculating the progress (EH) using this recorded
data is therefore as follows:
Earned Hours (EH) = Actual Quantities Executed
x Planned Labour Units
Continuing with our example, let’s say that the
production of ‘secondary cable trays’ during the
firstmonthoftheprojectwas400m.Ourprogress
(Earned Hours) would be:
Earned Hours (EH) = 400m x 0.80 hour/m = 320
hours
Makingthesamecalculationsacrossallactivities
in the Schedule for the month we would have an
overall result for the ‘Earned Hours’. But why is
this information needed? Let’s compare both
formulas:
Earned Hours (EH) = Actual Quantities x
Comparing one formula to the other it is clear
that the only variable is the difference between
the ‘planned’ and ‘actual’ quantities. Therefore
if the ‘actual’ quantities installed are more than
the ‘planned’ quantities in the reporting period,
the Earned Hours will be more than the Planned
Hours. Common sense tells us that we would be
ahead of our planned progress because we had
installedmoreworkthanplanned.Moreimportant-
ly,ifEarnedHourswerelessthanPlannedHourswe
should be aware that we are behind programme.
The Efficiency Analysis or the Actual Hours
(AH) Curve
EVM goes a little further than that. The next step
is to identify the efficiency of the direct labour
or, in other words, verify if the hours spent in
relation to the quantities executed are as per
planned. The formula for this part of the EVM
process is simply:
Actual Hours (AH) = Actual Quantities x
Actual Hours (Actual Labour Units)
The Actual Labour Units can be measured on a
daily or weekly basis per activity depending on
the level of accuracy required. It should be noted
that this analysis requires a significant commit-
ment from the foreman of the project and that
an administrator will be required for every 200
workers to record and monitor the data.
0
50,000
100,000
150,000
200,000
250,000
MONTHS
1 2 3 4 5 6 7 8 9 10 11 12
GRAPH 1: THE PLANNED S CURVE

Comparing the Data
It is now possible to compare the three formu-
lae, as follows:
Earned Hours (EH) = Actual Quantities x
Actual Hours (AH) = Actual Quantities x
Actual Hours (Actual Labour Units)
Comparing Planned Hours (PH) with Earned
Hours (EH) provides us with an indication of
progress. If the EVM analysis shows we are
behind schedule then we need to know why and
take corrective action.
Comparing Actual Hours (AH) with Earned
Hours (EH) gives us an indication of productivi-
ty. Common sense tells us that if we spend more
time than planned on an activity our productiv-
ity is below par. Similarly if we spend less time
than planned our productivity is above par. If
the EVM analysis shows we are below par we
need to find out why and take corrective action.
Likewise, if we are above par we also need to
know why and maintain it.
Let’s go back to our example, and consider
thatfortheproductionof400mofcabletrays,we
spent 360 ‘Actual Hours’ instead of 320 ‘Earned
Hours’. This gives us a production factor of 89%
when ideally we want 100% or more. This is not
good — we need to know why and implement
corrective action.
Bringing all the Data Together
The summary of this methodology is presented
PROGRESS & DELAY PRODUCTIVITY
PH x EH EH X AH
MONTH 1 5,000 > 3,000 = delay 3,000 > 1,000 = good
MONTH 2 13,000 < 18,000 = ahead 18,000 = 18,000 = as per planned
MONTH 3 25,000 < 35,000 = ahead 35,000 > 30,000 = good
MONTH 4 45,000 > 40,000 = delay 40,000 < 50,000 = bad productivity
below in another example on a project with
45,000 man hours to be constructed over a
four-monthperiod.Byplottingthedatarecorded
in each period graph 2 emerges over time.
From this we can extrapolate the following:
In addition:
In Month 1 – the delay and the good productivity
indicates a lack of man power.
In Month 3 – indicates the perfect world: good
progress and good productivity.
In Month 4 – indicates a disaster; delay and bad
productivity.
Why Use EVM?
EVMisinformativeandallowstheProjectManag-
er to make decisions and take corrective actions
where needed during the execution of the works.
Like all things that are good EVM comes at a
cost,requiringgoodandaccurateadministration
to be effective. Moreover, poor administration of
EVM will result in poor information and inappro-
priate management decisions and actions.
In the author’s experience one EVM Adminis-
trator working closely with the site foreman, will
be able to evaluate the daily EVM data for a work
force of 200 men.◉
1 2 3 4
PLANNED HOURS (PH)
EARNED HOURS (AH)
ACTUAL HOURS (AH)
MONTHS
GRAPH 2
0
10,000
20,000
30,000
40,000
50,000
SELF-ELEVATINGDRILLRIG,BRAZIL
▶ ricardo.delarue@systech-int.com

The Latham Report in 1994, heavily criticised how
the construction industry operated in the UK, and
was a catalyst for the introduction of a new Act
of Parliament. David Finlayson looks at how the
implementation of the Act, and the lessons learnt,
affected new legislation in Australia.
T
he UK Housing Grants, Con-
struction and Regeneration Act
1996 was a direct response to
the Latham Report. The Act
outlawed “pay when paid”
clauses, which were common
at the time, and gave statutory backing to
adjudication as means of dispute resolution.
It also gave the right to suspend work for
non-payment.
The legislation was enthusiastically received
in the UK. However adjudication, which was
envisaged to be a simple process, was initially
the subject of extensive challenges through the
courts.
The developments in adjudication in the UK
were being observed from overseas, including
Australia. Whilst the benefits of having a quick
and relatively inexpensive means of resolution
would have been attractive, some developments
occurring in the UK would have been seen as
A LEGAL
MINEFIELD?
less than desirable. It should be noted that the
UK Act has since been amended.
Legislation in Australia
The Australian legislation refers to “Security of
Payments”. As the term suggests, the legisla-
tion is narrower in scope compared to the Act
in the UK.
The legislation related to adjudication or
Security of Payments was developed for each
jurisdiction or Territory as follows:
Building and Construction Industry Security of
Payment Act 1999 [NSW] (2013 Amendment Bill)
Building & Construction Industry Security of
Payment Act 2002 [Vic]
Building and Construction Industry Payments Act
2004 [Qld]
Building and Construction Industry (Security of
Payment) Act 2009 [ACT]
ARGYLEDIAMONDMINE,AUSTRALIA
Adjudication Down Under
David Finlayson
Director of WA and
NT, Australia

Payment Act 2009 [SA]
Payment Act 2009 [Tas]
Construction Contracts Act 2004 [WA]
ConstructionContracts(SecurityofPayments)Act
[NT]
Similarities, Differences & Developments
The Australian legislation across all jurisdictions
gives the right to receive progress payments and
to suspend works for non-payment in certain
circumstances, whilst disallowing “pay when
paid” clauses. It also gave the right to adjudi-
cate payment disputes.
There are however some differences with-
in each of the above sets of legislation—the
legislations for Western Australian (WA) and
Northern Territory (NT) are seen as a funda-
mental departure, being referred to as “West
Coast” model by some writers, as opposed to
NSW-based or “East Coast” model.
Perhaps the key distinction in WA and NT is
that any party may apply to have a payment
dispute adjudicated, whereas in the other juris-
dictions only the claimant may apply, for exam-
ple subcontractor to contractor.
Furthermore, an adjudicator under the West
Coast legislation has the ability to act in a more
investigative manner and is not restricted to
consideration of documents submitted by the
parties.
Where a payment claim is submitted and
no payment schedule is issued giving reasons
for non-payment, there is the right under the
East Coast model, to go directly to the courts
to recover the full payment claimed as a debt.
The significant differences in legislation
together with developing case law have however
given rise to concerns, as detailed in Mathew
Bell and Donna Vella’s informative article
in 2010 “From Motley Patchwork to Security
Blanket: The Challenge of National Uniform-
ity in Australian ‘Security of Payment’ Legis-
lation”. They wrote in the abstract:
The primary aim was to ensure that cash flow was
maintained for all participants in the contractual
chain. A decade later, legislation based upon the
New South Wales model is in place in all States
and Territories and there is a substantial body of
case law governing how the Acts work in practice.
At the same time, however, significant differences
in approach across jurisdictions as to key planks
of the legislative platform have the potential to
defeat its original intent. This article proposes,
therefore, that the Australian construction indus-
try faces a moment of decision as to the future of
such legislation.
The report, by Bruce Collins QC, on subcon-
tractor insolvency in NSW made several specific
recommendations in relation to the NSW Act.
This resulted in changes, introduced by the
Payment Amendment Bill 2013, passed by the
NSW Government in November 2013. These
changes included:
For head contractors
Payment within 15 business days of submitting a
valid payment claim
Mustprovideasupportingstatementdeclaringthat
subcontractors have been paid what is due and
owing when submitting a payment claim
Paysubcontractorsandsupplierswithin30business
days of a valid payment claim being made.
For sub-contractors
Payment within 30 business days of submitting a
valid payment claim.
Fineswerealsointroducedfornon-compliancewith
certain provisions.
The Bill is likely to have a ripple effect, particu-
larly through the East Coast model jurisdic-
tions. In NSW, the Claimant Distribution in the
last quarter of 2013 showed fewer adjudications
were being initiated by subcontractors (120),
than contractors (277). It will be interesting to
see whether the introduction of the new Bill has
an impact on both the number of adjudications
and distribution of submissions in 2014.
Conclusion
Ultimately, adjudication, as a useful mechanism
for resolving payment disputes in Australia, will
stand or fall on its accessibility and effective-
ness in the eyes of the contracting parties, as
opposed to specialists, the legal profession or
even judges.
In NSW, which has seen adjudication used
most frequently, and other jurisdictions
PLUTOLNGPLANT,AUSTRALIA

following the East Coast model, clear terms are
imposed which override those in the contract
and only allow responses for items referred to
in the Payment Schedule, making the process
more attractive to referring parties. It could be
argued that the West Coast model is procedur-
ally a fairer process, but introduces elements of
uncertainty for referring parties.
Unification to provide a set of common
legislation across Australia, and updating to
reflect key decisions from case law, could be
helpful to contracting parties but are clearly
not simple tasks. There may also be difficul-
ties in relation to the law as it applies in each
jurisdiction.
In the meantime contracting parties includ-
ing clients, consultants, contractors, subcon-
tractors and suppliers must:
Be aware of the legislation and case law as it
applies within each of the jurisdictions in which
they may operate;
Ensure that payment processes are compliant
and that payment schedules/notices of dispute
are issued as appropriate.
A failure to do so could leave them facing an
order for recovery of a debt, or suspension of
work for non-payment of a sum it may not
consider is justified, or adjudication proceed-
ings with no sustainable defence.
Whilst the legislation is considered positive,
albeit a little difficult to grasp initially due to
the diversity of approaches, it is hoped that it
will achieve the objective of improving cash-
flow, which is the lifeblood of the industry.◉
▶ david.finlayson@systech-int.com

W
estern contract managers
lucky enough to have the
opportunity to work in Asia
often enter the Asian con-
struction sector for the first
time with their instilled
values and ways of working that will almost
certainly not be a perfect fit with both the
new environment within which they have to
perform, and the dispersed multi-cultural
contractual teams within which interaction
is invariably necessary on
large complex projects.
An example of the
potential for such a
blinkered-vision approach
was given by Peter Druck-
er (Management Challenges
for the 21st Century, Harper
Business 1999) who argued
“brilliant executives that
are being posted abroad
often believe that business skill is sufficient,
and dismiss learning about history, the arts,
the culture, and the traditions of the coun-
try where they are now expected to perform”.
Indeed, many issues need to be faced head-on
upon reaching your dream posting. To avoid
A
Contract
Manager
Abroad
the dream turning into a nightmare it is time
to swim not sink; with not only the obvious
language difficulties to overcome but also
differing corporate cultures and work meth-
ods, differing national cultures and fundamen-
tal differences between Eastern and Western
cultures and beliefs.
Asia is unlike the West and has fundamentally
different ways of working, which can seem very
strange and not to the liking of many West-
erners. But Asia has over 50% of the world’s
population, is a tremendously diverse region
comprising all the world religions and a host of
cultures, and, along with Europe and America,
is the world’s economic engine. So Asia is most
certainly a large slice of the global cake and more
care is required from the West to take a good
CHANGIDTSSANDWATERRECLAMATIONPLANT(SINGAPORE)
Cultural
awareness
in Asia
Part one of this two-
part article looks at
the importance for
Western contract
managers operating in
Asia to understand the
local ways of working.
Brilliant executives often believe
that business skill is sufficient, and
dismiss learning about history, the
arts, the culture, and the traditions
of the country where they are now
expected to perform.
Eric Webb
Regional Director,
Korea

look at the Asian ways of working. For example,
Asian businesses have a strong commitment to
their staff and customers, are team-orientated
with a preference for consensus over creativity,
and prefer gradual rather than radical change.
Despite such an emphasis on cooperation and
teamwork, culture dictates that open criticism
is discouraged where open confrontation and
losing face are taboos. The culture of harmony,
dependence, and community is the Asian Way
as opposed to the Western Way of independence
with often little sharing of ideas and informa-
tion. It is fair to say that employees of Asian
companies trust their colleagues and work in
an organisational environment where a similar
view of the future is shared.
Asia has major economic powerhouses with
China, South Korea and Japan at the forefront,
whereas in terms of competitive economies,
Singapore and Hong Kong lead the way. Although
South Korea and Japan now supply the world
market with recognisable brand names, a major
part of Asia is of course China, and with each
passing year China is growing into an economic
global giant with both eyes trained on becoming
what the Chinese have probably always consid-
ered as its rightful place, namely, at the head of
the global table. This is a country with over six
thousand years of rich history, many territories,
74 dialects and 56 nationalities, a land mass of
nearly four million square miles and a popula-
tion in excess of 1,300 million. Despite such facts,
Westerners frequently view the Chinese people as
one homogeneous population, but such a melt-
ing pot of differences clearly means more than
just one culture is at play, with a diverse popula-
tion of different religions, different sub-cultures
and different ethnic groups. Despite these
sub-cultures, Chinese people, for longer than any
other group on earth, have nonetheless shared
a common culture. Such a common culture will
continue to evolve, as the younger generation of
Chinese is part of a more global world.
The influence of Chinese culture throughout
Asia must not be underestimated in a region
where the overseas Chinese community has a
significant presence in business and politics.
Indeed, a study by the East Asia Analytical Unit1
in 1995 argued that “in order to manage busi-
ness operations effectively in the Asia Pacif-
ic region, it is imperative to understand the
Chinese way to run business”.
Cultures are human-made and cause numer-
ous issues between people, many of which can
result in insurmountable problems due to intran-
sigence. But individuals from different coun-
tries and different cultures can work together,
and differing points-of-view on construction
projects have the potential to provide effective
and creative solutions. Despite such opportuni-
ties, contractual problems arise because many
Westerners approach situations based on the
assumption that what worked at home will work
anywhere. For example, as argued by Chin-Ning
Chu, the author of Thick Face, Black Heart2
, “the
aggressive, high-tone, pushy, go-getting manner
is considered a great attribute in the American
business world. However, when applied in certain
parts of Asia, it is considered repulsive”.◉
▶ So how do Western contract managers address
the dynamics of cultural and multicultural factors to
resolve contractual issues on construction contracts?
The second part of this two-part article, in edition 2 of
SYSTECH INSIGHTS, will look at this perplexing issue.
eric.webb@systech-int.com
TAIWANHIGHSPEEDRAIL
1. East Asia
Analytical Unit,
Overseas Chinese
Business Network
in Asia (Parkes,
ACT, Department
of Foreign Affairs
and Trade, Australia
1995).
2. Chin-Ning Chu,
Thick Face, Black
Heart: The Warrior
Philosophy for
Conquering the
Challenges of
Business and Life
(Warner Books
1994).

Legal
Services
for the
Modern Age
S
ystech International has a well es-
tablished history of client-focused
innovation in developing and deliv-
ering its services. It has long been
a key part of Systech’s vision to
provide multi-disciplinary teams
of consultants, including fully qualified, prac-
tising lawyers on a cost efficient basis. Recent
developments in the regulations concerning the
management of solicitors’ firms have brought
us significantly closer to realising this vision,
and Systech has led the way in embracing this
opportunity.
The Solicitors’ Regulatory Authority (“SRA”)
is the government-authorised body in the UK
responsible for licensing law firms, implementing
regulations and ensuring continued compliance
with those regulations.
SLS Solicitors Limited, (trading as Systech Solic-
itors) is a law firm licensed and regulated by the
SRA which has been successfully practising as a
niche construction and engineering law practice
since 2008.
Prior to 6 October 2011, under SRA rules solicitors’
Rebecca Redhead
Director,
Legal Services

firms could only be owned and controlled by
solicitors. The regulatory environment began
to change with the Legal Services Act 2007
which recognised the scope for broadening
the legal services market whilst maintaining
strict regulation and controls. From 6 Octo-
ber 2011 solicitors’ firms could be owned and
controlled by both lawyers and non-lawyers
and could offer both legal
and non-legal services to
the public. A broad range
of company structures are
covered by the new regu-
lations; in summary these
are:
Traditional solicitors
firms, which can now
have non-lawyers as
shareholders or managers;
Law firms owned by external parties and
operated through a separate entity.
A combination of different services,
including legal services, being
offered by one firm; the ‘multidis-
ciplinary’ approach.
The structure adopted by
Systech is the multidis-
ciplinary approach
whereby Systech
Solicitors became
a Group business
allowing legal servic-
es to be offered alongside other consultancy
services in a fully integrated approach.
The Alternative Business Structure (ABS)
licensing process was introduced by the SRA
and applications were accepted from the
beginning of 2012. This was a lengthy process
requiring the submission of large amounts of
information followed by further requests for
clarification. In order for the ABS licence to be
awarded, Systech Solicitors needed to demon-
strate to the SRA that it was in compliance, and
would remain in compliance, with the amended
SRA regulations; that its directors were suit-
able professionals; that both its own accounts
and client accounts were administered prop-
erly. Systech Solicitors was granted its ABS
licence in February 2013, the first special-
ist construction practice to achieve this. The
Systech Group acquired Systech Solicitors in
November 2013 and the process of becoming
the first construction consultancy ABS was
completed in December 2013.
Following the transition, Systech
Solicitors remains a fully
licensed and regulated solicitors’ practice
offering contentious and non-contentious
services to its clients under the same SRA regu-
lations and client protection systems as under
the pre-ABS system. Instructing a solicitor still
needs to be carried out in accordance with the
SRA’s regulations, and so separate terms of
appointment will be used to other parts of the
business, but Systech Solicitors has developed
streamlined systems to ensure this is done
without any delay or inconvenience.
The key difference for our clients is that they
will benefit from the closer integration, with
our consultants working together under a single
point of responsibility to provide a co-ordinated
and seamless service, avoiding the abortive
work that often arises when using multi-party
advisors. There are closer working relation-
ships between the different disciplines creating
an extensive pool of contacts, knowledge and
experience from which clients will benefit.
In our experience, clients sometimes asso-
ciate the appointment of lawyers with liti-
gation, but this overlooks the range of other
skills lawyers can bring to a project. Obtain-
ing specialist legal advice can save cost and
time at all stages of project execution, from
pre-contract negotiation, contract drafting
through to dispute avoidance and resolution.
We also provide lawyers for in-house roles
on an interim or locum basis. This means our
clients can expand their in-house team with one
of our experienced construction lawyers. The
ABS structure means these lawyers have unique
access to support from the wide range of disci-
plines within the Systech Group and full profes-
sional indemnity cover; so our clients avoid the
cost and risk of appointing through a recruit-
ment agency.
The advantages to clients of our ABS
‘one-stop-shop’ are clear: access to an inter-
nationally unrivalled range of expertise; cost
and time efficient appointments and fully inte-
grated, multi-disciplinary, co-operative teams
providing the best advice and support.◉
Clients benefit from our integrated
approach with our consultants
working together under a single
point of responsibility to provide a
co-ordinated and seamless service.
▶ rebecca.redhead@systech-int.com

A
lthough in use for nearly two
decades, Period Analysis is a
relative unknown methodolo-
gy in the construction dispute
industry. Furthermore, few in-
dustry professionals know it is
the state of the art retrospective schedule de-
lay analysis methodology. This is the meth-
odology that can produce a “bullet proof”
schedule delay analysis in the hands of a
skilled operator. It provides a mathematical
approach to calculating results with a preci-
sion that all the other methodologies cannot
produce.
If it’s so powerful, why is so little known
about it? It’s because scant information has
been published about the methodology in the
An Introduction to
Period Analysis
past. It is a recognised methodology in North
America via the AACE [American Association
of Cost Engineering] schedule delay analysis
protocols. However, few actually practice the
methodology even though it is not that diffi-
cult to learn and understand. So to bring it to
light, this article presents an overview of Peri-
od Analysis for the lay person and those seek-
ing the best of the best schedule delay analysis
methodology to win disputes.
Period Analysis is a retrospective method-
ology. That means it is used for situations
where delay has occurred and/or continues to
be accrued. Period Analysis is the only meth-
odology that provides the ability to quantify
the accrual of actual delay over the lifetime of
project.
The State of the Art
Schedule Delay Analysis
Methodology
Jeff Perry
Director of Disputes

Period Analysis requires the use of the elec-
tronic files of network logic (CPM) sched-
ules. That means the electronic versions of
the construction schedules which could be
in Microsoft Project or Primavera sched-
uling software. Most major construction
projects employ these types of schedules.
Each construction schedule has a data date.
This is the date on which the schedule
reflects the progress of a project. For exam-
ple, if a schedule has a data date of 1 July
2014, this means the schedule represents
the status of the project on the date of 1 July
2014. Beginning with a baseline schedule, a
contractor will normally issue his schedule
updates on a monthly basis. So for example
if the project started on 1 January 2014, the
baseline schedule would have a data date of 1
January 2014. And, the contractor’s monthly
schedule updates would have data dates of
1 February 2014, 1 March 2014, and so on.
This schedule updating process is important
to recognise because it goes to the heart of
the Period Analysis methodology which all
the other methodologies miss.
Like the more commonly known Windows
Analysis, Period Analysis divides the lifetime of
a project into discrete timeframes demarcated
by the data dates of the available CPM sched-
ule updates. The difference between a Windows
Analysis and a Period Analysis is that the
Windows Analysis employs a one-step calcula-
tion and a Period Analysis employs a two-step
calculation. Now, what does that mean?
HAMADINTERNATIONALAIRPORT,QATAR

Take for example the real life situation where
a contractor starts a project and at the end
of Month 1 he updates his schedule with
progress information and discovers he is two
weeks late. In order not to offend the project
owner, the contractor revises his schedule to
remove the two weeks of delay and issues to
the owner a schedule that shows no delay.
And, for the next five months the contractor
repeats this process of incur-
ring two weeks of delay and
then revising the schedule to
hide the delay until Month 7
where it becomes obvious-
ly clear that the project is
delayed and there is no further
room in the schedule to hide
the delay. So, the contractor
gives in to reality and issues
to the owner a schedule that
shows a delay of 12 weeks (2
weeks – delay/month x 6 months) with a claim
for an extension of time (“EOT”) of 12 weeks.
So, as most owners would probably respond
under such circumstances, he tells the contrac-
tor to get stuffed. Not only has the contrac-
tor been reporting on-time completion for the
past six months, but if the delays were due to
the owner, the opportunity for the owner to
mitigate his own delays had been denied. So,
in this example, let’s assume the owner and
contractor both recognize there were a basket of
issues that reasonably impacted the Works, but
neither is 100% responsible for the total delay.
The problem is how to quantify the accrual of
actual delay that was effectively erased by the
contractor in his schedule updates and prove
the owner has culpability for the delays. Since
the contractor has the duty to prove his EOT
claim, he attempts to prepare a schedule delay
analysis.
The contractor first employs a TIA (Time
Impact Methodology) approach and learns that
the TIA can only produce a theoretical result –
it cannot equal the actual delay, and it cannot
provide a way to calculate how much delay
was erased by the contractor in his schedule
updates. So the TIA is of no use in a retro-
spective delay analysis approach to quantify the
accrual of delay. Of note, the TIA is actually a
tool for prospective delay analyses only, and
should not be utilized to quantify delay in a
retrospective analysis.
The contractor then employs an Impacted
As-Planned Methodology approach and learns
that it too can only produce a theoretical result
– it cannot equal the actual delay, and it cannot
provide a way to calculate how much delay
was erased by the contractor in his schedule
updates. So the Impacted As-Planned is of no
use in a retrospective delay analysis approach
to quantify the accrual of delay.
The contractor next attempts to utilise
As-Planned v As-Built, Collapsed As-Built, and
But-For methodologies and learns that none of
these approaches can provide a way to calculate
how much delay was erased by the contractor
in his schedule updates.
The contractor next attempts to utilise a
Windows Analysis and learns that this approach
cannot provide a way to calculate how much
delay was erased by the contractor in his sched-
ule updates. The reason is that the Windows
approach simply compares update to update
(i.e. one step calculation). This approach would
see no delay for six months and then one big
12-week delay at the end. The Windows Anal-
ysis only sees what the contractor published in
his schedules to the owner. There are variants
on the Windows Analysis to identify critical
delays, but the fact is one is looking progres-
sively forward in each window and then at the
As-Built condition after the schedule changes
were introduced into the schedule update. The
Windows Analysis approach can therefore not
recognise the mitigations incorporated into the
schedule update to erase the delay.
The problem is how to quantify the
accrual of actual delay that was
effectively erased by the contractor
in his schedule updates and prove
the owner has culpability for the
delays.

Having run out of solutions, the contractor
rings up Systech and requests assistance.
With the contractor’s schedules in hand,
Systech utilises Period Analysis to recreate the
contractor’s schedules that showed the two
weeks of delay before the contractor made
changes to the schedule to erase the delay. This
enables a calculation of delay or mitigation of
delay accomplished by incorporating changes
to the schedule structure. Hence, the two step
calculation. The sum of these two calculations
equals the total delay in the Period.
This process is repeated for each monthly
update to calculate the accrual of delay over
the course of the Project. As in this example,
Systech prepared an accrual of the two weeks
of delay in each Period due to lack of progress
(calculation 1) and its subsequent mitiga-
tion to zero delay at the end of the Period
(calculation 2) as a result of schedule struc-
ture changes (amendments). More technical-
ly described, for each Period (the timeframe
demarcated by the data dates of the schedule
updates), the Period Analysis enabled Systech
to quantify the delay due to lack of progress,
to identify the critically delayed activities due
to lack of progress, and to forensically iden-
tify the changes made to the schedule update
to mitigate the delay.
The result of the delay analysis is a tabular
quantification to show there were two weeks of
delay in each month due to lack of progress, and
then there was a mitigation of the two week delay
due to certain changes to the schedule structure.
To quantify the share of responsibility for the
delay, causation for each delay in each Period
is identified from the contemporaneous project
records. The records then provide a means to
identify responsibility for the delay. The Period
Analysis approach therefore enables a quantifi-
cation of the accrual of delay over the course of
the Project, enables identification of the cause
of delay based upon the contemporaneous
project records, and enables a precise calcula-
tion of the share of responsibility for the delay.
The findings of the delay analysis are docu-
mented into a report with appropriate exhibits
and the contemporaneous project records relied
upon to demonstrate causation and apportion
delay. The result is a mathematically superior
delay analysis with definitive proofs for causa-
tion and responsibility.
In the end, the Period Analysis produces a
truthful and equitable result based upon the
project records because the results are based
upon accrual of actual delay. The owner and
contractor are then able to reach an amicable
agreement on excusable and compensable delay
to the contractor.◉
▶ jeff.perry@systech-int.com

Systech’s Gavin Maxwell-Hart
is currently advising one of the
major supply contractors on the
Olkiluoto 3 Nuclear Power Plant
in Finland, a role which has seen
him appointed as Head of Contract
Management. In this article
he outlines the complexities of
working on nuclear projects.
NUCLEAR
POWER
PLANTS
CONSTRUCTING THE
NEW GENERATION OF
T
o put the Olkiluoto project into
prospective, it is one of the
largest industrial projects ever
carried out in Northern Europe
and will have had more than
4,000 people from 55 different
countries working on the site.
In 2005, Finland became the first Western
European country in 15 years to give permis-
sion for the construction of a new nuclear reac-
tor. The plant is the first European Pressurised
Reactor [EPR] to have gone into construction
and will produce 1600 MW.
The EPR is also the only one of its genera-
tion to have been certified in the United King-
dom and two of these reactors are planned for
the £16billion project at the Hinkley Point C
Nuclear Power plant in Somerset, which is now
awaiting final consent and go-ahead from the
European Union.
Constructing projects of such size and
complexity is not for the faint-hearted. Where
nuclear power is concerned there is a never
ending demand for uncompromising dedica-
tion to safety through design and manufactur-
ing quality, resulting in the highest tolerances
within the construction build to give the abso-
lute confidence in the safe operation of the
plant for the ensuing 60 years. There is also
the overriding necessity to gain the requisite
national Nuclear Safety Authority’s approv-
al and Operating Licence in order to allow the
initial loading of nuclear fuel and the ultimate
safe generation of power to the national grid.
Gavin Maxwell-
Hart
Olkiluoto Nuclear
Project 3, Head
of Contract
Management

This approvals process demands reviews of
all detailed design and construction methods
and requires the production of a large volume
(often in excess of 100,000 documents) of engi-
neering reports.
Then there is the co-ordination, collation and
approval of the factory acceptance tests (FAT
tests), test certification and
quality audits and records to
verify the highest performance
of the quality of the as-built
nuclear plant. In addition
it is necessary to provide a
complete trail of documen-
tation to allow traceability of
manufactured components,
suppliers’ equipment and I&C
installations and systems to meet the require-
ments of the highest safety classifications.
Not only does this create a logistics night-
mare but also a contractual headache between
the different designers, construction compa-
nies, tiers of subcontractors, suppliers and
sub-suppliers.
Depending on the organisation and manage-
ment structure for the construction phase, there
could be between 50 and 100 first-tier subcon-
tractors and suppliers, with a further 400 to
500 second-tier subcontractors and equipment
suppliers. In turn, as you move down the supply
chain the number of organisations that need to
be bound into the production and supply of all
the requisite safety, verification and compliance
certification and documentation is very likely to
extend into the thousands.
It therefore goes without saying that there
must be a strong organisational and logistics
structure, but this must be backed-up by an
equally strong contractual relationship struc-
ture to ensure the best performance throughout
the depth and breadth of the supply chain.
This is generally taken as-read within the
nuclear industry, but it does not negate the need
for tight contractual control to ensure there is
a “stick and a carrot” approach to award the
best performers and to have the necessary tools
to be able to allow control, management and
stimulus for the potential non-performers.
Systech has developed a strong practical
knowledge of the contractual control mecha-
nisms and an extensive expertise that will allow
it to service the growth of the new generation
of nuclear power plant construction across the
globe.◉
▶ gmaxwellhartconsult@systech-int.com
It is one of the largest industrial
projects ever carried out in Northern
Europe and will have had more
than 4,000 people from 55 different
countries working on the site.
OLKILUOTO3,FINLAND

1. Page 58,
The Society of
Construction Law
Delay and Disruption
Protocol, Society of
Construction Law,
October 2002, ISBN
0-9543831-1-7.
2. Page 28,
The Society of
Construction
Law Delay and
Disruption
Protocol, Society of
Construction Law,
October 2002, ISBN
0-9543831-1-7
A
fter many sleepless nights at work,
John finishes his claim. He feels good
about his narrative as the background
history is well supported by contract
clauses that give rise to major entitle-
ments. A couple of weeks after its submission,
John receives a letter saying that the claim has
been rejected as it has been prepared on a “glob-
al basis.”
TheDelayandDisruptionProtocolissuedbythe
Society of Construction Law defines a global claim
as “one in which the contractor seeks compensa-
tion for a group of employer risk events but does
Global Claims:
A Necessary
Evil?
not or cannot demonstrate a direct link between
the loss incurred and the individual employer risk
events.”1
The Protocol provides further guidance. “The
not uncommon practice of contractors making
composite or global claims without substantiat-
ing cause and effect is discouraged by the Protocol
and rarely accepted by the courts.”2
Whilst many will agree that a global approach
tends to undermine the strength of a claim, and
shouldthereforebeavoidedwhenpossible,others
argue that there is a time and place for the global
claim. On which side should you stand?
Scott Park
Director,
Abu Dhabi

Traditionally, the following conditions needed
to be established for each claim to be properly
considered:
Relevant event: occurrence of a defendant risk
event supported by contract provisions.
Damage: claimant suffers due to the event.
Causation: the damage incurred as a direct result of
the relevant event.
Hence, a typical global claim would say that:
It cost 100.
Owner paid 70.
Contractor claims the difference of 30.
In comparison, a typical properly developed claim
would have:
Loss due to incident #1 is 20.
Loss due to incident #2 is 10.
Contractor claims the total of 30.
For the sake of argument, what happens if it is
clear that a contractor suffered losses due to vari-
ous owner-risk events, but was unable to deter-
mine the exact losses for each event? Should
the claim for such losses be rejected leaving the
contractor to absorb the undue losses in totali-
ty? Is this equitable?
Intherecentandpossiblythemosttalkedabout
case of Walter Lilly v DMW [2012], Judge Akenhead
injects some common sense into the old tradition:
“In principle, unless the contract dictates that
a global cost claim is not permissible if certain
hurdles are not overcome, such a claim may be
permissible on the facts and subject to proof.”
In simple terms:
Global claims are permissible… unless the contract
says otherwise.
Facts and proof will be required to support the
entitlement.
This leaves us with a couple of options depending
whether you are siding with the claimant or the
defendant. My recommendations are:
If you are the claimant, prepare the losses for indi-
vidual issues wherever possible.
If it is not possible to avoid the claim being global,
put it forward as an opening negotiation position.
But, know that you will need to back it up with more
details later.
If you are the defendant, you can reject the global
claim for the lack of information.
And that the rolled up claim may be accepted in full
unless you are able to prove defaults of the claim-
ant’s own within the losses being claimed.
In summary – global claims should be avoided
where possible. But if you have no other option,
go global as a means of starting the negotiation.
Is it a necessary evil? We will let you be the judge
of that.◉
YASMARINA,FORMULA1,ABUDHABI
ADNECTOWER,ABUDHABITRAFFICCONTROLTOWER,ABUDHABI
▶ scott.park@systech-int.com

T
here are three important basic
elements required to successful-
ly manage a project and be best
prepared to deal with the many
issues that arise, such as com-
piling the as-built programme,
preparing a progress report, supporting an
application for more money, applying for
more time to finish the project, defending
against an accusation of poor performance,
challenging a particular version of events,
and producing or responding to a claim:
Records, Records, and Records!
Whilst the need for records and their impor-
tance is well recognised by contractors, all too
often we find that record keeping is an area of
acknowledged weakness.
How often have we heard a contactor say “we
have fantastic records”, only to find the truth to
Project
Record Collection
goes Mobile
Geoff Ansell
Director of Global
Marketing and
Training
▶ To learn more
about our app,
and to arrange
for a trial on your
project, contact
geoff.ansell@
systech-int.com
be very different? Or “we did keep site records
in the day book and on a laptop...but I am not
sure where they are now”.
Systech International has taken on the chal-
lenge of finding an answer to this problem and
our solution is a mobile phone app – the site
diary app.
The App
The site diary app will revolutionise the prepa-
ration of project records, ensuring that a daily
contemporary report is produced by staff with
direct knowledge of the events.
The app will be specifically configured for
each project and Systech will help the contrac-
tor with decisions on the reporting fields to
include. There is complete flexibility and exam-
ple fields would be site access, daily activities
being undertaken, labour and plant resources
on site, work activity completion percentages,
EDINBURGHTRAM,SCOTLAND

A Word of Warning
Whilst the site diary app will allow contractors
to prepare contemporary project records, the
users must be trained in the quality and type
of information to include – to avoid the risk of
“rubbish in, rubbish out”.
Users should also be aware that the site app
records may be admitted as evidence should
a dispute occur and care should therefore be
taken in their compilation. Emotive and colour-
ful language, such as that which came to light
in the Walter Lilly v Mackay case [2012 – EWHC
1773] should be avoided at all costs!
Conclusion
With our app, you can be sure that a daily
contemporaneous site diary is being main-
tained and be secure in the knowledge that you
have all the project records you need stored in
a safe and accessible location. Concerns over
lost records (where is that laptop?) or indeed
whether records were maintained in the first
place, will be eliminated and the need to prepare
easily challenged “after the event” records a
thing of the past.◉
the critical path programme activities, instruc-
tions received, delays to progress, outstanding
information or the management of risk. We will
also agree who in the project team will respond
to each field. Questions can be altered part way
through a project to take account of revised
priorities or staff changes.
Each individual submits their daily report
(which can include photographs) to a database
that automatically consolidates the responses
for each project into a single PDF format, which
is then emailed to an agreed
distribution list early the
following day. The PDF
report can go to members
of the project team and
also the relevant manag-
ing office, allowing senior
management to check that
the reports are being main-
tained daily and that the
correct information detail
is being logged. If required, corrective actions
can therefore be quickly implemented.
The database also has a word search func-
tion allowing bespoke reports to be prepared
to support, for example, on the management
of the project or additional variation and claim
entitlements.
Contractual Context
Records prepared on the app at the time the
work is carried out, by staff with direct knowl-
edge of the events as part of their daily activity,
carry great weight and credibility.
The distribution of the daily report can
include the client and other members of the
project team allowing the records to be “tried”
at the time of their preparation, adding further
to their weight and credibility.
The daily site app reports will also help
contractors comply with their contractual obli-
gations for providing notices – FIDIC “as soon
as practicable”; JCT “forthwith”; NEC “becom-
ing aware of the event”; IChemE “within 7 days
of the event”; GC/Works “immediately upon
becoming aware”.
The inclusion of data fields on the app to
record items of “change” or “impediments
to progress” will act as a prompt to users and
enhance their timely capture.
By using the app contractors will not only
have all the records they require to manage
the project but will put themselves in a strong
position to maximize any additional financial
and time entitlements or defend criticisms.
The site diary app will revolutionise
the preparation of project records,
ensuring that a daily contemporary
report is produced by staff with
direct knowledge of the events.
SYSTECH INSIGHTS ▶ Summer 2014 25
CROSSRAIL,LONDON
▶ geoff.ansell@systech-int.com


Know your contract and make sure you
understand the amendments from the
standard terms. There are often many of
these.

Hold a collaborative workshop for the
entire delivery team before the project
commences.

The Project Manager (PM) is not your
friend!

Only the PM is empowered to instruct
change. Do not accept any instructions
from another party.

Records, records, records. if it is not writ-
ten down it did not happen.

Use the NEC3 subcontract and make sure
to pass down the amendments from the
main contract.

It is worth spending time and effort on
the Accepted Programme. It is a suite
of documents, not just a bar chart, and
the latest version will form the basis for
assessing compensation event entitle-
ments – so keep it up to date too.
TOP TIPS
NEC
Success

Sort out issues before they become
problems.

Put in place a robust early warning notice
procedure and make sure all members
of your team understand their role in the
timely flagging of potential issues. Delays
to early warning notices can reduce
compensation event entitlements.

Keep early warning notices short and to
the point.

Use compensation events to increase the
value of the project and get “time in the
bank”.

Good records will help protect you from
disallowed costs.

If you are operating under Option A, aid
your cashflow by including lots of short
activities in the activity schedule.

Make sure you have a properly resourced
team.
Richard Morris
Director,
Expert Services
Richard Morris, recently presented
breakfast seminars in London and
Manchester during which he shared
his thoughts on how a contractor could
successfully deliver a project let under
the NEC form. Here are his top tips.
▶ The breakfast seminars are part of Systech International’s comprehensive training services offering. Our training is delivered
by construction and legal professionals with hands-on project experience, using a combination of academic and practical
elements to enhance greater understanding. To learn more about our training services contact geoff.ansell@systech-int.com
▶ richard.morris@systech-int.com

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experience for advice.
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Systech insights edition-Mark Woodward Smith

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