Pp1 seminar

Timun Loh
4. Dec 2016

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Pp1 seminar

  1. BACHELOR OF QUANTITY SURVEYING (HONS) [ Professional Practice 1 ] (QSB 60604) Prepared By : Lee Jian Ru , Loh Pey Mun , Leong Karr Khei INTRODUCTION TO ROLE OF QUANTITY SURVEYOR
  2. • A quantity surveyor (QS) is a professional working within the construction industry concerned with construction costs (figuring out just what a construction project is going to cost) and contracts. • The role of a quantity surveyor can be split into 3 stages which are: Quantity Surveyor A) Planning Stage B) Construction stage C) Post-Construction stage
  3. A) Planning Stage • Quantity Surveyor plays a key role in assessing whether the project is feasible economically. • The QS may act in consulting role to engineers and architects advising them on cost effective methodologies and procedures. • Feasibility studies of client requests : - Preliminary studies undertaken in the very early stage of a project. They tend to be carried out when a project is large or complex, or where there is some doubt or controversy regarding the proposed development. - Analysis of the budget relative to client requirements. - Advice on the viability and probable costs of construction. - Accurate initial budget cost by reference to cost data derived from previous projects. - Advice on the most economical layout, size, materials, methods of construction and quality of the work.
  4. B) Construction stage • While the project is underway , the Quantity Surveyor Ensures the process runs smoothly and within budget limits. • Conflict can arise and the Quantity Surveyor Steps in to act as a liaison between conflicted members of the construction process. • Interpersonal relationships among the construction team keep the project moving. • Attention to monitoring the costs and economics involved during the construction. Keeping the project running without conflict. Dispute resolution: - Dispute means argument, a disagreement and debate - It occurs due to uncertainty, contractual problems and behaviour. - There are several methods of resolving a dispute: 1. Change order review 2. Claim Review
  5. 1. Change order review Changes can happen for any number of reasons: sometimes technical or contractual documents are interpreted differently, the design changes, quality change, schedules run over or get delayed because of permits or inadequate schedule allowance, overtime or a change in the availability of labour or material. Quantity Surveyors are experts at detail, contracts and construction costs, they are in the perfect position to provide both the Owner and Contractor with a fair review of the how the change impacts the cost. The detail provided in the review leaves both parties with a clear, credible method to resolve how changes are handled before they become bigger problems. 2. Claim Review A contractor may submit a claim for greater payment than the original contract called for after the work has already been complete. Unresolved claims can result in construction liens so it is important to address the claims before they become bigger issues. Similar to a Change Order review, the Quantity Surveyor evaluates the details of the claim and provides an unbiased recommendation concerning the cost. Using a third party to recommend a fair and reasonable settlement keeps Owners and Contractors satisfied that the price being charged for changes are appropriate.
  6. • Site visits, assessments and projections for future work - For the Client QS, he is there on site to ensure the Contractor's cost control measures are efficient in order to keep the contract with the budget, to also confirm the valuation of work done raised by the contractor when the need arises and also to evaluates claims made by the Contractor. For the Contractor QS, he is there on site to help monitor the Contractor cash flow in quest to make savings for the Contractor, also to check the work done in order to raise valuations. - “work done in order to raise valuations”- is a pre-cursor to the issue of an interim certificate, which in turn allows an interim payment to be made - “cash flow”- lifeblood of the construction industry and relates to the incoming or outgoing of money to or from a company over a given period (usually monthly) B) Construction stage (continue)
  7. C) Post-Construction stage • After the project is completed, responsibilities and function shift. This objective now is to monitor the building and make sure that operational costs are kept inside the budget. • The responsibilities are to make sure the project adheres to local and national tax laws. • Insurance claims and cost of replacement are dealt with by the Quantity Surveyor. Accurate estimates of damages and costs of destroyed or damaged goods are also provided.
  8. • When the owner of a special purpose property (or special use property) appeals the value assessed by the relevant taxing authorities (MPAC in Ontario), they are always seeking to reduce the assessment. If the taxing authority wishes to defend themselves against the appeal, they need expert support. Quantity Surveyors can prepare Reproduction Cost Estimates or Replacement Cost New Estimates which are a detailed calculation of the costs to rebuild the facility exactly as it stands at the time. The QS can also assist in preparing depreciation schedules to account for the age and condition of the facility. This Estimate provides a thorough, detailed expert witness report which can be used in defence of the appeal in legal proceedings. C) Post-Construction stage (continue)
  9. Traditional Role Evolved Role Developing Role Role and Scope of Work
  10. Traditional Role • Quantity Surveying is a profession that dates back to the 18th century in the United Kingdom, when construction projects were measured and valued after they were designed and built. The “measurers” would quantify and assign a value to the work after the building was constructed and then negotiate with the client and architect on behalf of the tradesmen. • By the early 19th century, a new contractor system resulted in price competition before construction. Quantity Surveyors developed the skill of pre-measuring quantities from drawings and assembling them in “bills of quantities” before construction began.
  11. • To satisfy marketplace by filling the gaps across diverse industries. •As is reflected in industry changes, title changes and education. Reason 1 • Procurement became an important area of activity. • Largely because of the increase array of options that were available. Reason 2 Why Evolved ?
  12. Evolved Role 1. Investment appraisal  To provide objective, impartial and unbiased opinions about the value of real property  By providing assistance to those who own, manage, sell, invest in, and/or lend money on the security of real estate 2. Value management  To provide for all the required project functions but at a lower cost  To provide additional functions without increasing the cost  To provide additional functions and at the same time to lower the cost
  13. Evolved Role 3. Risk Management • Essential to construction activities in minimizing losses and enhancing profitability • Able to estimate the occurrence probability and the size of damage. • Risks analysis is so important for project selection and coordination of construction work. 4. Facility Management • Make sure that buildings and their services meet that needs of the people who work in them. • Manage services such as cleaning , security and parking. • Manage building maintenance like heating and air conditioning systems.
  14. Evolved Role 5. Insolvency services • Administer bankruptcies and debt relief orders. • Look into the affairs of companies in liquidation, making reports of any director misconduct. • Contractor insolvency brings with it many risks including: • work not being completed on time • work being carried out to a poor standard and with no or minimal comeback if defective.
  15. 6. Technical auditing  Verify different costs and expenses of the project to ensure their justified investment.  Check construction accounting functions with the analysis of bills and records.  Controlling unnecessary expenses and ensure quality standards and safety. Evolved Role
  16. • The future development of quantity surveying services is likely to be influenced by the following important factors : Developing Role Client Focus Development and application of information and communication technologies (ICTs) Research and its dissemination Sustainability Agenda
  17. Client Focus • Construction cost will always be the important component for clients. • Clients always be prepared to pay for the services that are able to demonstrate financial benefit. • There are some basic requirements of clients. • And also the client needs. • Focus on client satisfaction. Recognize that clients want buildings and support after completion, at the right price , to the appropriate quality and standards, on time and meeting their needs is important.  Reduced time scales  Practical completion must mean total completion, not ‘nearly ready’  Simplified process  Complete understanding of the procurement process  Comprehensive service including mechanical and electrical installations  Excluding the exclusions  Effective change management  Solutions not projects  Choice  Co-investment and risk taking  Commitment  Credibility  Competence  Clarity and accountability  Consistency The seven C’s
  18. Development and application of information and communication technologies (ICTs) • IT is clearly one of those areas that has impacted on all of our lives indifferent way. • From a social point of view, ICT has changed the way in which we communicate, research and reach decisions, manage our work and store information. • For example: Microcomputers, telecommunication, and associated equipment. • Computers have also had a major impact upon the profession of QS, in respect of the role and function of the professional activities. Such as, Cost X, Build soft and other software. • ICT continues to develop at an exponential rate. • Virtually everyone involved in the construction industry now has extensive access to this technology.
  19. Research and its dissemination • Several of the quantity surveying practices have now established research and development sections as integral part of their practices. • Research is therefore seen as being important for the following reasons: o Improving the quality of the service provided to clients. o Increasing the efficiency of work practice. o Extending the services which can be provided. o Developing a greater awareness of new technologies. o Providing a fee earning capability from research and development contract. o Enhancing public relations and practice promotion. Research Research Dissemination • The publication of research papers is now a part of an academic’s role for those working in universities. • Disseminated through academic mediums of journals and conference proceedings.
  20. Sustainability Agenda • Strategies such as Strategy for Sustainable Construction (2008) and The Low Carbon Construction Action Plan (2011) are key drivers informing the client’s sustainability objectives. • Nowadays, clients are becoming increasingly aware of the benefits and need to consider whole life costs, environmental impact assessments and evaluation of carbon emissions. • The impact on the quantity surveying profession can read through at Page 412 of the book Willis’s Practice and Procedure for Quantity Surveyor ; 13 edition. • QS needs to be aware of sustainability drivers and how they relate to the client’s key sustainability objective . • It is now important that QS adopts a wider outlook and provides advice mindful impact of the development on the environment. • The definition of sustainability is broad, so to participate fully indecision making the surveyor needs to be aware of aspects such as ecological concerns, corporate responsibility, waste management and other issues associated with environmental impact assessments.
  21. Value in Quantity Surveyor • The Royal Institution of Chartered Surveyors published a report in 1992, titled The Core Skills and Knowledge Base of the Quantity Surveyor. • This studied the needs of quantity surveyors in respect of their education, training and continuing professional development. • The RICS report identified a range of skills that the profession would need to continue to develop if it wished to maintain its role within the construction industry.
  22. Value in Quantity Surveyor • The RICS report identified a knowledge base that includes: o Construction Technology o Measurement Rules and Conventions o Construction Economics o Financial Management o Business Administration o Construction Law • Skill base that includes: o Management o Documentation o Analysis o Appraisal o Quantification o Synthesis o Communication Skills, Knowledge and Understanding
  23. The Professional Bodies  Royal Institution of Surveyors Malaysia (RISM)  Board of Quantity Surveyors Malaysia (BQSM)  Royal Institution of Chartered Surveyors (RICS)  Australia Institution of Quantity Surveyors (AIQS)  Public Associations of Quantity Surveyors (PAQS) • MALAYSIA • INTERNATIONAL
  24. Consultant QS vs Contractor QS • Consultants QS are usually employed by a client for their expertise, including cost management. • They gets involved at an early stage of the project and is consulted on costs at every stage, from initial design through to the completion. • They are largely responsible for the validation and monitoring of costs. Initial tasks for a consultant QS involve advising on procurement, producing initial cost plans and hiring contractors. • Once the project is up and running, the consultant QS will liaise with the contractor’s QS to verify and authorize monthly payments and to approve any changes to the original price. • They tend to be largely office based, typically getting out on site about once a week.
  25. • The role of a contractor’s QS is to ensure that the project stays within the given budget and to maximize profit for their employer. • They are often based on site and are very much at the Centre of the project, watching it progress from day to day. • A contractor’s QS gets an overview of the construction process and hands-on technical experience. • Among other things, they are involved in preparing and reviewing subcontract tenders (finding the most suitable subcontractors for particular sections of work), managing the subcontractor’s work throughout, reporting on the financial progress of the project, generating valuations for the work done to date, and overseeing the payment of the subcontractors. Consultant QS vs Contractor QS
  26. Questions 1) How long do arbitrations usually last? Ans : Summary proceedings, on average, take between 7-8 months from start to finish. Oral hearings that involve large claims, complex issues, and a number of parties may take 12-15 months from start to finish. 2) What is cost planning ? Ans : A means of controlling the design process to meet the budgetary requirements of the client. It enables the quantity surveyor, with the design team, to design a building to a cost, rather than costing a design after it has been completed.
  27. 3. Why is working in a contractors office for over 10- years as a QS not good enough to warrant being registered as a PrQS ? • Only the professional QS can be formally registered • The contractor QS is trained to ensure that the keenest price is calculated for tenders and minimal expenditure and wastage is incurred to maximize profit for the contractor firm. • Whilst the professional QS is engaged to ensure that primarily the client's interests are looked after in a totally unbiased manner. • The rules of behavior and ethics as set by the profession are very onerous and the culture is totally different to that of a contractor QS. • It is not impossible for a contractor firm trained QS to register as a PrQS, but it very difficult unless they are exposed to the pure PrQS ideology and methodology at the coalface for at least 12-months. • Similarly, a PrQS who has not been exposed to the competitive, dog-eat-dog micro cost management environment necessary to survive in the contractor environment, will also battle to cope when employed by contractors.
  28. 4. Can a PrQS work in the civil or other engineering fields? • YES. • There is a very big market for knowledgeable PrQS who are experienced in engineering fields, plus there are a number PrQS practices that specialize in engineering quantity surveying. • If one looks at the formal education curriculum of any of the engineering fields, they learn so little about costing, quantification, tenders and contracting in their university years. • This is possibly why there are so many massive cost over-runs and disputes on these projects that are run solely by engineers
  29. 5. What are the differences between Consultant QS and Contractor QS ? • Refers to the slide 24 and 25. 6. In your opinion, why research and its dissemination is important for QS at the future ? • Improving the quality of the service provided to clients. • Increasing the efficiency of work practice. • Extending the services which can be provided. • Developing a greater awareness of new technologies. • Providing a fee earning capability from research and development contract. • Enhancing public relations and practice promotion
  30. THE END ~ Thank You ~