Alexandria Engineering Journal (2019) 58, 487–497
H O S T E D BY
Alexandria University
Alexandria Engineering Journal
www.elsevier.com/locate/aej
www.sciencedirect.com
SHORT COMMUNICATION
Prepare and analysis for claims in construction
projects using Primavera Contract Management
(PCM)
Hesham A. Abdel-Khalek a, Remon Fayek Aziz a,b,*, Israa A. Abdellatif a
a
b
Faculty of Engineering, Dept. of Structural Engineering, Alexandria Univ., El-Horeya Rd., El-Shatby, Alexandria 21544, Egypt
Civil Engineering Department, College of Engineering, University Of Business & Technology (UBT), Jeddah 21361, Saudi Arabia
Received 11 July 2018; accepted 8 May 2019
Available online 24 May 2019
KEYWORDS
Construction management;
Construction Claims;
Construction Contracts;
Construction companies;
Primavera Contract Management (PCM) and Construction Stakeholders
Abstract Change management has a crucial importance in the project management field. Changes
in the construction field can be consolidated directly or converted to a full process project claims. A
lot of theories and area of concerns spotted claims consolidation methods and techniques to seek
best practices to solve such problems between all construction project stakeholders. It is not easy
to completely prohibit claims from arising in the construction project, but as the technology developing rapidly; it became easier to face arising claims with a fully documented project, as the good
documentation is a fundamental requirement in a successful claim Lixia et al. [5].
Due to project complexity increasing and project cost rising, it is essential for companies to succeed in managing their project’s budget and schedule. According to Oracle, 90% of projects overrun
their assigned budget, which leads to a high percentage of failed projects in the construction field.
Hence, a lot of software appeared to help claimers to manage their claims in the best effective way
to reduce the time consumed in the hard preparation which needs a lot of effort and resources to be
completed. In another way, the new software maintains focusing on how to win the claim not how
documents prepared to go through a claim.
One of this software is Oracle Primavera Contract Management (PCM) which is a web-based
program includes many features such as document management, cost control, field monitoring
and time management. In addition to that, it decreases time schedule delays which provide visibility
in the contract performance by providing a central repository for data on the turnaround time on a
given process. Reporting this data provides the project managers with a useful metric of average
contractor performance and work process and helps to identify which contractor needs extra attention or should be avoided in future projects.
PCM enables timely payments for completed work by providing the ability to view, track and
automate performance beast progress payment to subcontractors. In addition, to ensure that unnecessary delays are avoided it also reduces liability by improving turnaround time between project
contributors. This paper aims to identify the method of using the PCM program and Primavera
* Corresponding author.
E-mail addresses: remon.aziz@alexu.edu.eg, r.iskandar@ubt.edu.sa (R.F. Aziz), esraaahmed21891@gmail.com (I.A. Abdellatif).
Peer review under responsibility of Faculty of Engineering, Alexandria University.
https://doi.org/10.1016/j.aej.2019.05.001
1110-0168 Ó 2019 The Authors. Published by Elsevier B.V. on behalf of Faculty of Engineering, Alexandria University.
This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).
488
H.A. Abdel-Khalek et al.
P6 to prepare the claims in a short time with less effort to produce fully documented claims. In addition to that, it illustrates how users able to make delay analysis using Primavera contract management, which linked to the PCM program. In addition to that, it illustrates the application of one of
the web-based project management software toward construction company performance. Also, to
emphases and analyze the advantages of implementing the Web-based project management system.
Also, this paper investigates the PCM effectiveness in stringing and managing construction projects.
Finally, improvement in project progress can be achieved by applying PCM to generally enhance
company performance and specifically during facing claims.
Ó 2019 The Authors. Published by Elsevier B.V. on behalf of Faculty of Engineering, Alexandria
University. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/
licenses/by-nc-nd/4.0/).
1. Introduction
The construction field is one of the most rapidly growing fields
nowadays. This business is known by its large number of
claims which arising continually and that because it’s special
characteristics. This field described as a complex, high risk,
and also includes many stakeholders. Moreover, it is very
important to be always on time and within project budget in
this type of business [6]. On the other hand, delays are the
unremitted problem, and even the companies did their best
to control the delays, it will normally appear over and over.
While the construction projects expect delays, which leads to
additional costs, delay analysis has become a demand for construction projects [1]. Due to the variety of contract types and
conditions in the construction field, contracts claims are
unavoidable. As claims spreading in a lot of different projects,
the claims related to delays are noted as the best known,
famous and common type of claims. In addition to that, it
has been detected that delays on the construction field and
the related claims initiating from these delays together are
the fundamental fragment of the recent construction project
[7].
Besides, the procedure of claims which results from project
delays begins concurrently with project commencement itself
[10]. By reviewing several previous researchers, it has been realized that construction projects have a propensity to face delays
which convey possible losses for all stakeholders. In addition
to that, delays include all extensions in the baseline or in other
words in the original time schedule [8].
The idea of construction claims is famous, regular and not
new, but the missing part in this issue is the methodology
which supports the construction officials to measure the level
of efficiency for their construction claim process [11].
2. Tools and procedures
The data for this thesis has been gathered through detailed literature reviews from over 25 studies all over the world and
then a case of study was conducted to introduce one of the
most effective methods to track the project in order to prepare
a successful claim.
The data required for achieving the aim of this study were
resulting by conducting applicable software (Primavera contract management PCM) to solve one of the claim management problems. The study consists of two sections, first of
them is solving a claim preparation issue by using PCM and
the second section is the guidance of users to conduct a claim
analysis using PCM and Primavera P6. For further understanding of the method of using PCM in construction preparation and also the procedure of applying the delay analysis, a
case of study was conducted using one of the construction projects. This project contained 11 different changes which led to
claims. The following points introduce the project which used
in the case of study:
2.1. Project description
The studied project is the construction of the Administration
Building in Cairo, Egypt. The building consists of a reinforced
concrete skeleton which includes 2 basements, ground floor, 9
repeated floors, and roof.
The original scope of work for the general contractor was
to execute the required retaining system and use a suitable
dewatering system suggested from by consultant, and that with
an original budget of 2,548,000 EGP and the required duration
is 5 months begins from 1/8/2014 and finishes on 3/1/2015, see
baseline time schedule, Fig. 1 contains a copy of project
baseline.
2.2. Activities to be executed in the site:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
Excavation from level ( 1.22) to level ( 1.60).
Executing a secant pile guide beam.
Executing bentonite piles.
Executing concrete piles.
Installation of the dewatering system and start running
the system.
Continue excavation until reaching the level ( 2.60)
from street level and piles head demolish.
Executing the capping beam for secant piles.
Executing of steel struts.
Continue excavation until reaching the level ( 9.35)
from street level and piles head demolish.
Other works for raft implementation and basement
works are out of the scope.
To summarise the changes occurred in the project, changes
details have been listed in Table 1. Each change converted to
be a full claim, and that by using a designed procedure in
the PCM. For more illustration, and before describing the
detailed procedure, the following lines will describe the main
windows of the PCM and its features. See Fig. 2 shows the
access window of the PCM, this window appears for each user
Prepare and analysis for claims
Fig. 1
489
Baseline time schedule started on 03/08/2014 and finished on 24/01/2015.
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Table 1
No.
List of change orders in the case of studied project.
Change order
1
rev 01
Change order 1
2
rev 02
Change order 2
3
rev 03
Extension in CO2
duration
4
rev 04
Change order 3
5
rev 05
Change order 4
6
rev 06
7
rev 07
Extension in CO4
duration
Change order 5
8
rev 08
Extension in CO5
duration
9
rev 09
10
rev 10
11
rev 11
Extension in CO3
duration. (change
order 6)
Extension in CO3
duration-2.
Extension in CO3
duration-3.
Activities ID
Delay
Schedule
start date
Schedule
finish
date
Additional
cost (EGP)
Delay Description
08-032014
08-032014
08-032014
27/1/
2015
06-102015
29/6/
2015
1,91,543.5
Addition of change order no. 1 works (Piles extention and fence
demolish)
Addition of change order no. 2 works (soil grouting)
5
155
08-032014
12-072015
38,03,551.5
EC
17
Addition of change order no. 4 works (Releaf Wells Under Blanket)
EN
10
–
A1440.
A1450,A1460,A1470,
A1480,A1490.
A1510.
EN
EC
50
65
23/12/
2015
01-052016
28/4/
2016
3,55,160.0
A1430
08-032014
08-032014
08-032014
Add 10 days for sewage manhole modification to increase the its
capacity (Change order 4 extension)
Addition of change order no. 5 works (shallow wells dewatering
system)
NN
7
08-032014
05-072016
–
A1520, A1530, A1540,
A1550.
EC
25
08-032014
06-022016
3,02,476.0
A1560,
A1590.
A1600,
A1630,
A1660,
A1570, A1580,
EC
11
EN
70
13/6/
2016
22/8/
2016
–
A1610, A1620,
A1640, A1650,
A1670, A1680
08-032014
08-032014
Type
Duration
(days)
A1006.
EC
3
A1160, A1170, A1180,
A1190, A1200, A1210.
A1220, A1230, A1240,
A1250, A1260, A1270,
A1280, A1290.
A1300.
A1310,A1320,A1330,
A1340,A1350,A1360,
A1370,A1380,A1390.
A1410, A1420.
EC
133
EC
19
NN
EC
17,38,100.0
–
9,36,000.0
–
Add 19 day as a result of increasing no. of grouting phases for the
hole site perimeter + applying permeability test (additional grouting
phases CO2 ext.)
Addition of change order no.3 works add 5 days as a result of
stopping until resolving sewage permits issue (basements
construction)
Add 7 days for stopping excavation works as requested from the
consultant , and modify plain concrete purring method to be
executed by strips (stopping excavation works)
Add 15 day for drawings modification of impeded steel dwells
+ 10 day for applying modifications (add duration and cost to
ChO03.)
Àdd 11 days for delay in modeling ramp drawings . (delay in
modifying ramp drawings)
Add 70 day for stopping the current dewatering system in sequence
and wells injection .(stopping the current dewatering system)
H.A. Abdel-Khalek et al.
Schedule
rev.
Prepare and analysis for claims
491
Fig. 2
Fig. 3
Fig. 4
Access window.
Work portal for each user.
Work portal attributes.
and that allows each user to access by his own username and
password. Also, the administration specifies each user’s limits
to view.
After accessing the system, the mainframe will appear as
shown in Fig. 3. This figure simplifies the working portal,
the left side shows the main menu of the program, it includes
492
H.A. Abdel-Khalek et al.
Fig. 5
PCM documents menu.
divisions of the existing projects and subdivisions for documents related to each project. The rest of the screen is the area
of notifications and monitoring of all projects.
To have closer seen for the works area, see Fig. 4 which
describes in detail the features of the front screen. In addition
to that, Fig. 5 shows the subdivisions menu which contains all
the modules related to each project. Each module or document
contains some reports and forms which organize the entered
data from all users in the project.
Moreover, the procedure that has been used to apply the
PCM in this case of study runs as follows:
After creating a new project module and before start working on any claim, the document controller must be assured of
finishing from entering the following:
(1) All current and existing companies and contacts must be
entered into the project in the companies’ field.
(2) The contract must be attached and its original value has
been added to the budget filed. This step is very important because in the future any additional changes in cost
will be generated and added to this original contract.
(3) It is important to take in mined any entered data such as
contract date or any dates for changes as will show in
case of study.
Since the previous points have been checked, the following
are recommended organized steps starting from problem
appearance to the phase of closing the issue in sequence:
(1) Problem recognized on the site or an indication of an
arising problem.
(2) Request for information (RFI) will be sent (Through
PCM) from the contractor to the consultant or owner
to discuss the problem and ordering an answer. This
document used in PCM to enter a request for information or answer inquiries. Requests and answers offer
supplementary information or elucidate some aspects
of the projects. These aspects can be procedures, equipment lists, and materials.
(3) A new issue will be opened parallel with the opening of
the new RFI, the issue is required to be the source of all
documents related to this problem or RFI. An issue can
be defined as a problem that should be determined and
resolved before a project completion or it is a specific
status of the project that can lead to change orders in
contracts or claims. Organizing and ordering project
information by issue offers rapid assessment for each
problem that could affect the project timeline or completion cost. Moreover, Issue can be linked to any Contract
Management module in the PCM documents excluding
the Cost Worksheet and other issues (linking one issue
to another issue is not valid). Some items in some documents can be linked to issues. For instance, correspondence items can be linked to different issues than the
correspondence document that contains them. In addition to that, the user has the ability to link contract/purchase order (PO) items; daily report visitors, labor, and
equipment; proposal and change line items; notepad
items; punch list items; drawing revisions; submittal
revisions; and materials delivery tickets to the same
issue.
(4) The Ball in court person (BIC who have to answer) will
send the answer for the problem within a specified duration, and that in the same window of the same RFI.
(5) The answer may contain one of the following:
(a)
If the RFI does not need action, so the answer will
just be enough to cover the question, and this case
arises when there is no impact on the project
constraints.
(b) If the RFI needs action, the BIC has to take the
action within if the RFI need to start change order cycle and this case arise when there is an impact on one of the project constraints.
(6) In case of change order required, we will start to go
through the change order managing process, this process
starts when the consultant revises that there is an impact
on one of the project constraints. Hence, we can say that
Prepare and analysis for claims
the trip of preparing the claim starts. Change Management document window used to record the steps in the
Change Management process, including the estimated,
quoted, negotiated and final costs in addition to other
change information. The window is divided into many
tabs, which you can use to record related details.
The Change Management in PCM goes as following:
(a) The owner or the consultant buts an estimated cost
value and estimated required duration for the required
change order, and then submit Request For Proposal
(RFP) from the same contractor and other contractors.
(b) The contractor submits his quoted cost through a document called Proposed Change Order (PCO).
(c) This PCO goes under negotiation phase between the
owner or consultant and the contractor.
(d) After reaching the negotiated cost and duration, official
Change Order Request (COR) with the final negotiated
cost will proceed.
(e) The owner and the consultant admit and confirm this
request to be Change Order (CO).
(7) Through the previous steps, related required documents
will be attached to each step. Drawings, correspondences
sent or received, letters, meeting minutes, notepads,
notices and noncompliance notices, request for information, safety, telephone records and transmittals are kinds
of documents supports the change management process.
(8) The program can offer good designed forms and reports
for each window; those forms and reports contain a summary for each module and showing the entered information in organized tables which enhance the seeking for
special information and good document tracking in addition to automatically updated reports.
(9) Through the previous steps, if any step rejected, the claim
has to be closed or we can go to the higher level which is
Mediation or Arbitration. The delay analysis was conducted using Collapsed As-Built Technique. This method
is a retrospective method also identified by As-built but
for. It depends on a comprehensive rebuilding of the asbuilt program. In addition to that, it has a restricted
prospective capability (It can be used to elucidate the
delay effect on the accomplished part of a partially finished project). This method proved to be effective in
claims resolution. The point of strengths of this method
is that it does not depend on an as-planned program but
relies on fact-based or on as-built schedule. In another
hand, this method is difficult to be illustrated and also it
is hard to establish a dynamic as-built schedule because
of the complexity to determine and model logic which
requires detailed as-built historical records.
After applying the previous procedure, reports and forms
can be called any time in order to prepare and analyze claims
as shown in the case of study and its reports. One of the most
important reports is the Issue module report, see Fig. 6 shows
one of the reports of the issue module taken from the applied
project in the case of study. This report collects all the issues
related to the project and its status. In addition to that, the
issue module can be consumed to design a more detailed
493
report, see Fig. 7, this report gathers all the historical details
for the project issues, the appeared issues are relating to the
change orders accrued during the project including the cost
of the change.
3. Results and discussion
The study highlighted a crucial area of concern and finds that:
(a) From applying the case of study in PCM and analyzing
claims it appeared that applying and getting results from
the software consuming less time and efforts from doing
the job manually. This decreases the time, efforts and
number of employees assigned for claims preparation
job.
(b) Following any system for the document control is better
than never, without systems, the failure of the project is
guaranteed, even the system followed is simple, it will
leave its impact on the project.
(c) Any user must first design a flow path for any documents depending on the company enterprise and roles
of employee, this will help in successful growing the system and applying easily in it since each person know his
or her mission.
(d) The program contains reports and forms; these reports
and forms can be customized to match the organization
requirements.
Comparing with the previous researches in the same field,
Nemr and Hassanein [3] suggest developing a documentation
process for claims and procedure by introducing filing systems
for claims and using electronic document management systems. In the same area of research, Microsoft Access database
management system has been established by Al-Sabah et al. [2]
in order to apply claims analysis and documentation system
for extra budget and time extension which needed complete
the projects. As a deficiency in this system, the user cannot
capture the required related documents in the system, which
makes it hard for proofing the claims. Furthermore, this system is limited to be used in the place where it is packed up
and installed in, and unfortunately, it is not underpinning
the internet accessing as a web-based program, in other hand
PCM solved this problem.
According to related researches, multi-agent systems have
been developed by Ren et al. [13,14]. This system solves one
of the problems of the construction claims which is the negotiation phase, and that by letting the project parties directly
negotiate with each other. Ho and Liu [4] contend that
throughout economy declining, ‘‘opportunistic bidding” is
common where the contractors deliberately offer a low bid
with the expectation to recover the loss by claims. Inevitably,
when this happens the number of claims of a project will be
very high where significant time and efforts will be required
for settling the claims and resultant disputes.
People’s performance during claims has been explained by
Liu and Ho [4] who established the Claims Decision Model
(CDM). They illustrated how the claiming circumstances are
related to bidding behavior, and also which situation supports
or discourage opportunistic behavior. Claims participants can
analyze the construction claims realistically and offer a better
understanding of claim aspects which leads to settlement.
494
H.A. Abdel-Khalek et al.
Fig. 6
Issues log report.
In addition to that, a new systemic approach used to prepare claims by cause-mapping and system dynamics. This
approach was presented by Williams et al. [9] who argued
his system includes a claim form which presents problems
causes and allows using a qualitative model in order to construct claims from its related causes in the system. Then, different scenarios expressed by the computer module to introduce
the final claim.
Nevertheless, till now inadequate researches produced in
the field of enhancing claims management system using a
Web-based methodology which is very important not just only
to support the documentation of construction claims, but also
for controlling the time consumed in claiming process. Moreover, it also helps to share all the information related to the
claim successfully [12].
The main aim of this to study the existing practice of document management using PCM program as it is one of the
most famous web-based programs in order to help in prepare
claims and solve them. Comparing with traditional desktop
programs, PCM systems able to introduce concurrent access
to the system through any place in the world as long as internet
access is available, which support sharing the same information related to the project in the same time for all users. Generally, knowledge management has been receiving growing
attention from both the researchers and practitioners regarding the number of research done and various approaches formulated by construction companies to better harness their
knowledge. Advanced computer technology has been used to
help to manage crucial construction knowledge, including
knowledge about claims, and other aspects of the construction
project. With regard to managing the knowledge about claims,
however, there is a lacuna as the existing emphasis seems to
focus on the analysis of the number of claims and the delay
caused. But as showed in this thesis, the study concentrated
on a core problem which is a failure of prepare a good claim
in a short time and solved this problem by using Oracle Primavera Contract Management (PCM) which is a multi-user,
multi-project database system for managing all projects
aspects. It also covers the stakeholders’ relationships and manages to access to each part of the project between them. In
Prepare and analysis for claims
495
Fig. 7
Issues detailed history report.
496
addition to that, Delay analysis is continually required during
any claim analysis process. Because of this, PCM offers flexibility to be linked to Primavera P6, which is the main program
now used for scheduling and time analysis.
Moreover, the management of claim and the need to capture the knowledge generated based on the outcome of a claim
have hitherto not been properly addressed. Also, this conceptual framework aims to fill in the gap through the development
of a system capable of managing the workflow of the claim and
the deadlines for various actions and preserving a copy of the
collective knowledge of those involved in the claim with the
possibility to extend it for the understanding beyond the original participants.
4. Conclusions
Claim Management is an unavoidable issue in Construction
Project Management, and also its important process to achieve
successfully the required results. However, the first requirement is to mitigate or avoid claims by managing all parties
and coordinating all project documents. Also, it always better
to reach an early settlement on claims issues which is cheaper
and most of the time leads to win-win situations.
This study presents a simple procedure for claim preparation using one of the most famous Oracle software, which is
Primavera contract management. Also, by the help of the Primavera P6, a delay analysis implemented for the case of study.
As claim preparation process takes a long time and efforts to
collect required documents by a large number of employers,
this thesis shows how to reduce those resources and efforts
by tracking the project from the first day and through all the
phases of the project.
After applying a case of study which contained 11 related
claims in the same project and entering all the project information and details in the PCM program, preparing any claim
become easier, and it can be done by calling one of the program reports or forms which is automatically updating just
when the user adds a new data or information in any required
module.
Issue tool in the program is the winning card which the claimer depends on to complete the preparation process. In addition to that, all the change orders are recorded with the
smallest details and it can easily be recalled any time through
program reports and forms as showed in the Previous chapters. Delay analysis will be remaining to be done with the help
of the Primavera P6, which is already linked to the PCM, and
any changes in the P6 will appear in the PCM. Regarding to
the studied project type, a suitable delay analysis technique
was selected in order to generate a correct delay and classify
them into 4 types. Also, the analysis was implemented from
the contractor point of view and from an owner point of view
at the end of the project.
Finally, and as a result from the study, using Primavera
contract management program through all the project phases
will provide arising claims, and even if there are new changes,
the program will efficiently manage those changes and these
will result in saves rights for all stakeholders in the project
who are involved in the program.
In conclusion, this study added a new method for tracking
project documents in order to mitigate or control construction
claims and apply delay analysis using one of the web-based
H.A. Abdel-Khalek et al.
programs which are Primavera contract management and Primavera P6.
5. Recommendations
(1) For companies and organizations:
Applying the PCM system in their companies as early
as possible, to gain the most advantages for all the
project phases and especially when claims arising.
Force all main stakeholders to get involved in the
PCM system and link releasing their invoices by applying and respecting the system, and this will decrease the number of claims arising in the project.
Continues training for employers is needed to reach
the required level of document controlling in the project, it’s also important to customize the program reports and forms to compatible with the Organizational
Process Assets.
(2) For researchers:
More researches are needed in this felid to compare
the process and reach the easiest procedure which
leads to solving claims with no efforts and before
reaching the disputation level.
Preparing periodic seminars to Identify PCM Requirements and how these requirements implemented
through construction activities to contractors and consultants.
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