PROJECT MANAGEMENT (QSB4424)

GROUP ASSIGNMENT 1

No.

NAME

STUDENT ID

KAVILAN A/L MANOHARAN

0903P70282

FELIX LAU CIUN WOO

301789

JOSHUA SONDIHON WILIS

301012

LEE CHEE MING

308958

MUHAMMAD MUZAFFAR ALLY POOMUN

310902

QI BING DUO

303389

THAM YE LIN

0301528

YO KAI SEN

0310563

TABLE OF CONTENTS
No.

Item

Page No.

Letter of Proposal
1.0 Introduction

2.0 Proposed Project

3.0 Procurement Method

3-5

4.0 Time Management

6-9

5.0 Cost Management

10

6.0 Quality Management

11 - 14

7.0 Risk Management

15 - 20

LETTER OF PROPOSAL
LAN BUILD & CO. SDN.BHD
SEA LION SDN.BHD.
S3, Jalan Merdeka,
42940 Pulau Ketam,
Selangor
Malaysia

16 JUNE 2016

Dear Sir,
PROPOSAL CONSTRUCTION FOR A SINGLE STOREY RESTAURANT EXTENSION TO
REAR OF SITES, JALAN MERDEKA, PULAU KETAM, SELANGOR.
PROPOSAL ON BEST PROCUREMENT AND CONTRACT ARRANGEMENT

We are pleased to advise on the best procurement and contract arrangement for the
project stated as the following:
1) Best Procurement Method
2) Best Contract Arrangement
3) Advising on Methods

: Design and Build (D&B)

: Design and Build Competitive Contract
: Procurement Method
Time Management
Cost Management
Quality Management
Risk Management

Please do not hesitate to contact me for any inquiries.

Thank you.
Yours Sincerely,

Kavilan A/L Manoharan

Senior Project Manage

1.0

INTRODUCTION

Pulau Ketam, literally translated, means Crab Island which located off the coast of Klang.
Visitors can go to the island from the Port Klang jetty by ferry. Pulau Ketam is a low-lying, muddy
and fringed with mangroves forest which is an ideal habitat for the crabs and other marine crustaceans
which inhabit these waters. Visitors enable to witness and experience the unique lifestyle of fishermen
in Pulau Ketam. Although Pulau Ketam is in the middle of the sea but the home stay facilities are
readily available. There are no roads or cars in the island and the only way is by walking or cycling on
the narrow wooden or concrete boardwalks within the village. Pulau Ketam is a place free from air
pollutions, traffic jams finding car parking problems etc.
Pulau Ketam evolved from a desolated island and now Pulau Ketam became one of the well
know place and attract of a lot visitors during the weekends or holidays. In 1870s, three Hainan
fisherman from China arrive at Pulau Ketam. They came Pulau Keta to catch crabs as their living.
They came and returned to Port Klang daily and it took almost a day for the trip. Few months later,
they decided to built a small house and stay overnight, then row back to Port Klang at the second day
for selling crabs and buying daily sundries. After that, they decided to stay at the island permanently.
The population in Pulau Ketam started to increased since 1883s. Majority of the villagers in
Pulau Ketam are Chinese. The villagers earn their daily living through catching crabs, fishes, prawns
and sell sundries. They also play roles as a major fishes, crabs, prawns provider to Klang Valley area
and a tourism spot of Negeri Sembilan. Services such as schools, clinics, police station and electricity
have been added over the years.

2.0

PROPOSED PROJECT

During the site visit to Pulau Ketam, we made our reservation with Sea Lion Home Stay as our
accommodation for three days two nights. The home stay is in the middle area of residential area and
hardly for us to find foods during night time. We are required to ride a distance to the shop to have our
dinner. Therefore, we proposed to construct a restaurant behind the empty land of the homestay.

The restaurant is not only to provide food for the visitors who stayed in the homestay but also for the
villagers who stay far away from the shop. This restaurant provide convenient and near for the people
who stay around this area or far away. We proposed to construct a 15m x 45m restaurant on the empty
land behind the homestay. The restaurant is built 1-2 meters above the ground level. There will be a
bridge connecting the homestay and the restaurant. The restaurant will be made up of three areas
which are the cooking area, serving area and dining area. Cooking area will be located at behind of
the restaurant and it is cook in an open space. The serving area will be in the middle part and it consist
of two roller shutters which locate in front and behind of the serving area. In the serving area also
provide a storage room for the business to store their daily staff. The dining area will be located in
front of the restaurant. The restaurant will provide two toilets for the customers who came to eat at the
restaurant. The surround of the restaurant will be covered by handrail to ensure the safety of the
customers and prevent them from falling down.

Storage

Dining Area

Serving
Area

Cooking
Area

Figure 2.1 Proposed Restaurant

3.0

PROJECT PROCUREMENT METHOD

Design and Build

2

Design and build is a procurement method that has been used for a long time although it may still be
new to some contractors. The roles of professional consultants continue to develop and change. The
same goes to the method of procuring a building. This is because of the complexity and difficulty of
the contractual relationships in the construction process. Eventually, the design and build procurement
was brought into the construction industry after a long time.

Characteristic
Design and build contract is an agreement between the client and a contractor. The contractor will be
responsible to undertake both the design and the construction works in accordance to requirements
laid down by the client. This is a single financial transaction with single point of control and
responsibility. Therefore, the client will only deal with the main contractor as the main contractor will
instruct the subcontractor and the others. This method of procurement requires the client to provide
his requirements as clear as possible in order for the design and builds team to come out with the
product that the client is looking for. It will be a problem if the client is not comprehensive enough
because it will affect the design and build team to design a building which did not reach the clients
satisfaction. Therefore, the clarity of the requirements laid out is imperative. Due to the contractual
relationship of the client and the main contractor, the main contractor holds full responsibility should
anything go wrong during the construction progress. The main contractor may have his own in-house
architect, engineer, quantity surveyor, designer or even subcontractor but the overall work shall be
following to the clients designs and also budgets.
Nevertheless, there is always a risk in using design and build procurement. First of all, the
responsibility of the contractor includes design, production, and any necessary statutory requirement
by the client. The contractor must follow the clients requirement as agreed. If the particular work has
been completed but it did not reach the clients satisfaction, the contractor will have to change it.
Normally this occurs because the client does not understand the aesthetic and architecture. Any
changes ordered by the client will be liable for extra money. Other than that, the completion of time is
as important as the quality. The contractor will be responsible for any delays. Extensions of time are
not solely in the contractors interests.
In addition, client will request the contractor to submit a Guarantee Maximum Price (GMP) based on
the approximate bills of quantity either by percentage estimate or omission on the price arrived.
Sometimes the contractor can introduce an alternative design for the cost comparison to the client.
The contractor may be able to achieve the cost lower than the GMP if the client has given approval.
Upon the acceptance by the client of the GMP from the contractor, all the work covered by the GMP
shall not exceed the maximum cost of the contract unless it is a change in the scope, specification of

works, implementation schedule or new amendment of statutory requirements affecting the works by
the client.

Figure 3.1 Contractual relationship for Design and Build

Reason for selection of Design & Build

There are several of advantages of design and build method. Firstly, it has great delivery speed from
conceptual design to completed building. Design and build method is faster compared to traditional
procurement. This is because the work of design and build can be started earlier compared to
traditional method. Upon the approval of incomplete design by the client, the contractor can start the
work and at the same time the contractor will continue to design. Moreover, the contractor has no has
full authority on the work. Due to the single point responsibility, the contractor is responsible for the
design and the construction works. Other than that, the contractor appointed by the client to carry out
the task may have experienced working together on previous projects. This will benefits both the
contractor and the client because of the experiences from the past projects, the contractor has already
well known the design and the budget cost of the client. Usually, the client is happy with the quality of
their works as the contractor is familiar with the clients requirement. Besides, design and build can
help the client to save cost in such a way the there is less management involved in post contract,
therefore the client is paying lower management fees in resulting cost saving.

Disadvantages of Design & Build

On the other hand, design and build has its disadvantages as well. The original price may be higher
than the final cost price as the contractor may build into his price a risk premium. Other than that,
the client has less control of the design. There is a risk on inflexibility for the client. Once the client
has agreed to the design, there are very limited of element that the client can change. If the client does
not have a strong set of clients requirement, the client might not be able to get the design that meets
his expectation. In such cases, the client might need to pay extra to the contractor to change it. Not to
mention the final quality of the design. The contractor is somehow not using the high quality of
products that the client is expecting unless a set of specifications is included in the clients
requirement. Nevertheless, the extension of time will occur due to the changes required by the client
on certain element.

Design and Build Contract Form

The design and build contract form consist of two methods:
I.
II.

Single Entity
Competitive

Single entity method of contract is where the contractor is appointed by the client without any
competitive contractors. In the other hand, competitive method of contract will have outline design
prepared by several contractors and ask to submit the final design and costing. Then the client will
choose the best proposal based on the design, price and time to complete the project.

4.0

TIME MANAGEMENT

Table A.1 shows the work breakdown and the time taken for the project. The work breakdowns break
into six main stages of activities. The six main stages are mobilization, piling works, main building,
5

ancillary building, infrastructure works and demobilization. The time taken for the mobilization works
for the project is 21 days as each activities such as site survey, site facilities and plant & machinery
consist of 7 days to complete. After mobilization, the piling works will proceed. The piling works
time taken to complete for the project will be 10 days as the piling works consist of main building and
water tank. As for main building works time taken for the project will need 124 days to complete as
main buildings work consist of reinforce concrete super structural works, roof & painting,
architectural works and M&E works. The main time consume to complete the main building works
are super structural works and architectural works. The time taken for the super structural works
required 60 days for work such as slab, beam and column needed time to construct. As architectural
work will be 42 days to complete because of plastering and tiling works needed to be work as
appropriate as client demand for the quality may focus on the particular works. The time taken for the
ancillary building works is 2 days and infrastructure works time taken for the project is 9 days. The
infrastructure works consist of sewerage works and walkway. Lastly the time taken for the
demobilization works to complete the project is 5 days.

Time, with its associated costs, are vitally important for each participant in the construction process
including the lender, owner, architect engineers, contractor, and subcontractors, as well as those who
provide bonding and insurance coverage. Effective management and the administration of the contract
time and change provisions are central to the avoidance and mitigation extended time and cost
overruns. Moreover this project is located in an island therefore many precaution and early planning
need to be done. There are four major element regards time that could affect this project would be:-

i.
ii.
iii.
iv.

i.

Labor and material accommodation

Rise of Sea Level
Transporting materials and machines to sites
Weather

Labor and material accommodation

It is important that project planning and time estimates factor in the availability of skilled and
unskilled workers within the project area. If the project will require specialized trades in addition to
those that can be sourced within the local area, then consideration must be given to the following
issues: - An estimate of the quantity and duration of non-local workers required for the project; - A
6

search for the most suitable source of non-local workers and the likely mode of transport to the
project area which is an island. A thorough investigation of the local accommodation alternatives,
including hotels and motels in that island will not be suitable because its only for tourist. Evaluation
time taken to build new or temporary accommodation to host the workers it will be a long duration.
Additional labor from outside the project region is required because there wont be any labor source
for construction in that island, it will be necessary to provide local accommodation which will
increase and prolong the project time. It maybe encourage able to find temporary accommodation
facilities outside the island and it would be reducing the time of constructing temporary
accommodation in that island itself. Same goes to material storage area we cant place material on d
ground due to the sea level which will raise n might flood the material storage area. Therefore we
have to build a temporary storage area which will prolong the duration. To overcome this problem
what we can do is:1. Rent a place at Port Klang and the labor can take the 1 st ferry to the island which would be
less costly compare to building a temporary accommodation.
2. For material storage we can temporarily use the space at the back of Sealion home stay but we
have to bring in the material stage by stage because the space is limited.
ii.

Rise of sea level

This rise of sea level impacts will vary spatially in line with variations in sea level, which can

interrupt the construction schedule and delay the project. To avoid this we have to study the sea level
and collect data regarding it. To avoid the sea water to flood the proposed project area we can take
few step:1. Improve drainage systems and divert the water other direction
2. Elevate further up the project
3. Preserve wetlands and floodplains that protect coastlines from flooding and damage
4. Build protective barriers in certain places
By following all this steps this will increase the construction time and further more we will need more
skill worker to be imported to the site and extra accommodation will need to be provided. To
overcome this issue we have to plan ahead so it wont consume much time.

iii. Transporting materials and machines to the site

Transporting heavy equipments and material to an island is no easy task. Contractors and
suppliers have to hire large size of ships or else find an alternative way to transport the material and
machineries. Contractors and suppliers also have to discuss the challenges of getting heavy equipment
7

to those sites and maintaining them in that island itself. Even the machines have transported to the
main land to the island there will be another problem which is transporting the machineries and
material through the small walk ways in that island, or else we have to use other option such as use
untouched way if it so than it also till requires time to clear and create a new way to transport the
machineries and material. To overcome this issue few things can be:

We can use small type of equipment and machineries which is easier to handle store and
transport.

iv. Weather
As anybody in the business will know, construction is heavily affected by the weather.
Strict health and safety regulations have to be met on building sites and if weather conditions reach a
critical level then operations necessarily cease. Weather can affect many aspects of a construction
project, from site work to worker discomfort. Indeed, there are many different weather events that
could impact on a construction project, strong wind, heavy rain, lighting and more. One of the main
dangers from strong winds will be to people and loose material which is at a height, as it is likely to
be more exposed and therefore more susceptible to high winds. If the wind is strong, there can be a
risk of materials such as roof tiles and fast-moving debris striking a person. Also, the wind can whip
up dust which can damage or irritate eyes, as well as aggravating conditions such as asthma.
Where else for lighting if can affect in a way where abundance of metal on a construction site
means that the risk of lightning is very real, particularly for objects which are tall and higher up such
as cranes and scaffolding. Acting as conductors, there is a chance they could be struck by lightning,
causing electrocution, fires, or explosions as a result. For rain it can create an unpleasant situation to
work in, the presence of heavy or torrential rain will reduce visibility for the drivers of vehicles, and
will turn the ground into mud which poses its own risks to the health and safety of site workers .
Furthermore it will not allow the concrete to harden or to be poured during rain. All the above issue
will end up in consuming time and delay the project. There are few solution that we could suggest to
overcome this issue:

Reasonably anticipated the total number of days could be affected by weather. There are
references, such as historical project data that has been accumulated by the contractor or owner
that can be used to support its calculation and also we can collect data from weather report and
anticipate total numbers of days will be affected.

As this issue have been forecasted earlier therefore we have allow total numbers of days for delay due
to weather in our work break down table.
8

5.0

COST MANAGEMENT

Cost Estimating is a very important factor in project management as it establishes the start line of the
project cost at each of the steps of construction. Some of the rates for the cost estimate may be
obtained through available cost handbook, online selling sites like alibaba.com or based on a
practically similar building like the proposed building and lastly the rates may also be obtained by an
estimator based on the available data of the proposed building.
While having the group discussion, our group came to a conclusion that there are 2 ways that we can
calculate the total amount of each element thus having a final amount (estimate) for the whole
restaurant project. The first method is using the Gross Floor Area of the building (GFA) and the
second one is the basic estimating method.
For the GFA method, we must do a lot of pro-rating. But by using the pro-rating method, the rates
obtained are not applicable due to it being a kind of lump sum rate. Let say for example we have to
pro-rate a 100m2 of floor for tiling. But in these 100m2, 60m2 is for homogenous tiles and the 40m2
9

is for marble tiles. When we do pro-rating, the types of tiling are not taken into consideration. Instead
the pro-rating id for the whole 100m2 of floor.
For the Estimating method, it is easier. This is how we do it basically.
ESTIMATED PRICE= QTY X RATES
The quantity is calculated by ourselves by doing some measurements but the rates, as mentioned
above, we used the online selling sites and the help of the in-house estimator. Unlike the GFA method,
the estimating method do the breakdown of the rates for each and every specific items keeping in
consideration their respective specifications
So comparing the 2 methods, we chose the Estimating method which is easier to use due to the help
we received from the in-house estimator.
Development cost such as
(1) Professional fees
(2) Finance Charges
(3) Legal fees
(4) Administration fess
(5) Contingencies fees
Are all not included in the final estimated amount of the restaurant project
Labour fees and transportation fees are deemed to be included in the final estimated amount
of the project.

6.0

QUALITY MANAGEMENT

Quality control is the part of quality management that ensures the products and services comply with
the requirements. Quality control and safety represent increasingly important concerns for project
managers. Defects or failures in constructed facilities can result in very large costs. Even with minor
defects, re-construction may be required and facility operations impaired that will cause the cost
increase and completion date will be delay. In the worst case, failures may cause personal injuries or
fatalities. Accidents during the construction process can similarly result in personal injuries and large
costs. Indirect costs of insurance, inspection and regulation are increasing rapidly due to these
increased direct costs. Good project managers try to ensure that the job is done right the first time and
that no major accidents occur on the project.

ISO 9001
ISO 9001 is one of the way to control the quality of the building works. Projects to be constructed will
require certification from ISO 9001, to ensure a degree of quality is met. By manage quality with ISO
9001, the work tend to be more quality and less defect works will be occur in the end of the building
10

product. ISO 9001 provide management skill to the person to manage the quality of the building such
as using Quality Assessment System in Construction (QLASSIC) to control the quality of building.

Quality Assessment System in Construction

The Malaysian Construction Industry Standards (CIS) are used for the project to control the quality of
the building works. In order to control quality, CIS 7:2014 is a standard used as reference to control
the quality of the project. CIS 7:2014 sets out by QLASSIC to standardize the quality system for the
construction industry. QLASSIC is a requirement for the work to be followed in order to get a quality
assessment for a building. There are four components needed to follow requirement for quality
assessment which are structural works, architectural works, M&E works and external works. For
architectural work, they will check for the evenness surface and hollowness for internal walls,
straightness of the edge or angle for internal walls. Structural works will be checked for its rebar,
formwork, and so on. M & E works will check for electrical works, plumbing works and so on. Lastly,
external work will be checked for requirements of external drains and so on. In QLASSIC, there are
four category of building which is category A is for landed housing, category B is for stratified
housing, category C is for public/commercial/industrial buildings without centralised cooling system
and category D same as category C but with centralised cooling system. The project that we have
proposed in Pulau Ketam is restaurant. By using QLASSIC to achieve quality of the building works,
the component of restaurant works will require to follow under the category C of QLASSIC.

11

Figure 6.1 QLASSIC Process Flow

Figure 1.2 shows the process to achieve the quality works by using QLASSIC. These are the process
will go to construct our restaurant in the Pulau Ketam, in order to get the quality assessment.
In order to ensure the quality of the project, monitoring and controlling is an important process during
the construction stage. The performance of the project can be monitored through the monitoring and
controlling process.
The phases of the project management lifecycle consist of completing and managing the work
required to meet the project objectives. The phase is also to ensures that the project management are
been monitored and adjustments are done according to the project schedule as needed. University of
Illinois (2015) shows the description on how a project should be monitored and controlled through a
process. The process is shown below:

12

Project monitoring and control should carry out in various activities. The following of activities
provides help in monitoring and controlling a project.

1. Manage and track decisions

Manage and track decisions are required in order to construct the project. As the early stage of
construction, we have responsible to plan and make decisions before the construction is start.
Manage and track decisions are importance as they provide future reference for constructing the
project. As the project has been managed, it tends to be done smoothly and mitigate false
decision and planning in the construction process. Therefore manage and track decisions are
importance and required to construct the project.
2. Project change management
Project change management process will be executed as the significant change to the project
scope, schedule or budget. This is the process that required during the phase of monitoring and
controlling.
3. Execute and revise communication plan
Execute and revise communication plan is also require to our project. Overtime as construction
works progressed, communication is done in the form of email, meetings, telecommunication,
etc. These communications can help to improve the output of working constructions.

13

4. Execute and revise project schedule

As the project task is going, the schedule of the project has to update. The update is follow by the
status of the project task. In this project, we have to monitor and update the schedule regularly.
Monitor and manage risks and issues
Monitor and manage risks and issues have to be included in our project. As early stages of the
construction, management risk has to approaches in order to mitigate the risk during
construction. If the project manager identifies any issues, he must immediately implement
alternative plan into the project structure.

14

7.0

RISK MANAGEMENT

We have identified several risks that may arise during the construction progress of the proposed
restaurant building. These risks are predicted to occur based on probability that it may also affect the
construction works to be carried out. While these risks are not yet known to how severe it can affect
the construction progress and its undetermined impacts, we have carried out a risk management
probability and impact matrix. This allows us to analyse the risk and assess them in terms of
probability of occurring and impact of such risk towards the construction works.

Table 7.1 Weather related issues

Weather related risk is a common type of risk that may occur at any time during construction progress.
Weathers may be harsh and severe, thus affecting the progress of the works to be carried out in the
construction site. With the occurrence of a threatening weather, it may affect the construction in terms
of workers health and performance. It may also affect the materials such that it may degrade their
quality depending on the exposure to different weather conditions. In some ways, risks that are of
weather attributed cannot be controlled but it can be foreseen and monitored to a certain extent.
Weather conditions can be predicted by using weather forecast reports. By identifying the foreseeable
poor weather conditions, we can make up assumption for the number of days which may delay the
work progress. In doing so, we can prepare countermeasures into the works program structure.

15

Table 7.2 Labour efficiency

Labour efficiency is also one of the common risk that can be found in any construction site.
Depending on the workers performance, it may produce different result in the quality of the
construction output. The construction output may be questioned in the aspects of durability
and aesthetic value. This type of risk can be assessed by monitoring and controlling the
activities of workers in the site. One of the things that can be done to ensure the workers are
performing up to standard is by appointing a supervisor at the site to make sure that works are
being done properly. Documents and certificates containing the information of every workers
may also help the client to know whether the workers have the capability and necessary level
of skill to carry out the works. This can be referred to the already mentioned ISO and CSO,
whereby the quality of the works by workers can be monitored and controlled.

Table 7.3 Sea level

16

In pulau ketam, the island is known to have its inconsistent sea level where it changes depending on
the time of the day. During the daytime and night time, the water level increases. Conversely, the
water level drops in the afternoon and evening. This is potential risk that must be taken into
consideration in the construction process especially during the stage where piling works are to be
carried out. The exposure of the pilings to the water may affect the overall foundation. This however
can be prevented in some ways should the client be open to some of the solutions. Firstly, dewatering
systems can be proposed so as to prevent any water excess to the site. Other than that, protective
barriers can be erected around the site at to keep the water level at bay.
Table 7.4 Accessibility

Accessibility to site is also an apparent risk, considering the nature of site location for this proposed
building. Naturally, the diverse erection of buildings in pulau ketam has already made it difficult to
17

introduce more construction planning. This is an inherent problem because contractors are faced with
the primary concern of how to bring materials into the site. Heavy machineries are the biggest
problem in this aspect. This particular risk cannot be avoided due to the congested building locations
in pulau ketam. The one solution that we brought up is the use of smaller equipments and
machineries. In relation, some items that cannot be brought in to site will have to be cast or assemble
on site.

Table 7.5 Public nuisance

Construction works that are carried out can often cause public nuisance to the neighbouring residents
nearby. Potentially, there may be a rise of objectors who will complain and hinder the construction
work. To avoid this, the project manager should take into consideration when the suitable time for the
construction is to be carried out during the day. This is especially crucial when conducting works that
require the use of machineries. Our solution to this risk would be to rent the nearby land space located
behind our site. Legal rights to the particular land should be obtained early and approved by local
communities or authorities so as to prevent any trespassing issue to the land.

Table 7.6 Financial difficulties

18

Financial difficulties must also be taken into consideration during the progress of the
construction. This is important during the stages at which both clients and contractors participate in
the transaction of progress payments. The financial capabilities of both the client and contractor
should be carefully assessed. This is to prevent any events of insolvency and bad cash flow from
either side so as to not interrupt the construction works. Prior to carrying out works, company
background and financial records are important documents that need to be referred to.

Table 7.7 Site safety

19

Satisfactory level of site safety must be fulfilled as it is one of the primary standard to
be followed in a construction. Accidents are potentially probable, regardless of how small scale the
project may be. However, considering our proposed restaurant to be of only a single storey, we can
safely assume that it would only be a minor accident. Regardless, safety standards have to be followed
so as to minimize the risk.

Table 7.8 Lack of space

The availability of space in a site is a problem that we have foreseen in this particular construction. In
relation to this, materials are required to be stored somewhere near the site. Due to the limited space
that we have in our site, it is difficult to keep all the materials on and near our site. This is especially
apparent during the construction of our piling works and slabs. Additionally, the space that we have
proposed our restaurant to be constructed has greatly limited our storage space. We have already fully
occupied the available working space for workers. The solution

20