Korneva Daria
Korneva Daria
Korneva Daria
Technology, Lappeenranta
Double Degree Programme in Civil and Construction Engineering
Daria Korneva
The purpose of this work was to create a technical brochure with a description
of a turnkey construction project system in Karjalan Rakennus ja Maalaus OY.
Also the term “project” was explained and the phases of the project lifecycle
were defined. The main target was to offer some new developments, which
would make the turnkey construction project system clearer and usable for
Russian customers and positively influence on the purchase decision.
In the theoretical part of the study the main issue was to tell the most important
technical things of the construction process, which are interesting for customers
and influence on the purchase decision. The information was gathered from
literature and Finnish regulations concerning construction as well as from the
web pages of Finnish and Russian building companies, interviews, visits to the
building site and direct observation.
As a result of this the technical brochure was done. The terms “project” and
“project lifecycle” were explained. The phases of the project lifecycle were
looked through from initiation to closing the construction project. Some new
developments, which can attract more international and Russian customers,
were offered to the company.
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CONTENTS
1. INTRODUCTION ........................................................................................... 5
1.1 Turnkey construction project system ........................................................ 5
1.2 Introduction to Karjalan Rakennus ja Maalaus OY ................................... 6
1.3 Geographical and climatic introduction to Finland .................................... 8
2. MAIN DEFINITIONS OF PROJECT MANAGEMENT .................................. 12
3. PROJECT LIFECYCLE................................................................................ 14
4. INITIATION PHASE ..................................................................................... 15
4.1 Foreigners’ rights for acquiring real property .......................................... 17
4.2 Assignment of a project manager ........................................................... 18
4.3 Selection of the house ............................................................................ 18
4.4 Obtaining the building permit .................................................................. 19
4.5 The procedure for obtaining a building permit ........................................ 20
4.6 Initiation process..................................................................................... 20
4.6.1 Creating the project proposal ........................................................... 21
4.6.2 Reviewing the project proposal ........................................................ 23
4.6.3 Approving the project proposal......................................................... 24
4.6.4 Transitioning to the planning phase.................................................. 25
4.7 Contract process in Karjalan Rakennus ja Maalaus OY ......................... 25
5. DESIGN PROCESS..................................................................................... 27
6. PLANNING PHASE ..................................................................................... 28
6.1 Customizing the project plan................................................................... 29
6.2 Developing the project plan .................................................................... 30
6.2.1 Project scope and scope management ............................................ 30
6.2.2 Construction schedule ...................................................................... 33
6.2.3 Cost control plan............................................................................... 33
6.2.4 Quality assurance plan ..................................................................... 34
6.2.5 Human resource plan ....................................................................... 35
6.2.6 Communication plan......................................................................... 36
6.2.7 Risk management plan..................................................................... 37
6.2.8 Purchasing and contract administration plan.................................... 37
6.2.9 Project documentation and project baselines ................................... 38
6.3 Transitioning to the execution phase ...................................................... 39
7. EXECUTING THE CONSTRUCTION PROJECT ........................................ 39
7.1 Basement works ..................................................................................... 40
7.2 Frame works ........................................................................................... 43
7.3 Waterproofing of the roof ........................................................................ 45
7.4 Materials ................................................................................................. 47
7.4.1 Outside materials.............................................................................. 47
7.4.2 Inside materials ................................................................................ 48
7.6 Transitioning to the controlling phase ..................................................... 55
8. CONTROLLING THE CONSTRUCTION PROJECT.................................... 55
8.1 Quality control......................................................................................... 56
8.1.1 Supervision during construction ....................................................... 57
8.1.2 Soils inspection................................................................................. 59
8.1.3 Moisture in floor................................................................................ 60
8.1.4 Infrared camera analysis .................................................................. 61
8.1.5 Air tightness measurements ............................................................. 62
9. CLOSING THE CONSTRUCTION PROJECT ............................................. 63
9.1 Client ...................................................................................................... 64
9.1.1 The final inspection........................................................................... 65
9.1.2 Issuance of certificate of occupancy................................................. 65
9.1.3 Final client approval.......................................................................... 66
9.1.4 Builder-provided closing documents and final financial statement.... 66
9.1.5 Property closing................................................................................ 67
9.1.6 Warranty procedures........................................................................ 68
9.2 Building site ............................................................................................ 68
9.3 Construction stakeholders ...................................................................... 69
9.4 Project file............................................................................................... 70
9.5 Project team............................................................................................ 71
9.6 Audit procedures..................................................................................... 72
9.7 Closing process in Karjalan Rakennus ja Maalaus OY........................... 72
10. CONCLUSIONS......................................................................................... 72
FIGURES ......................................................................................................... 75
APPENDICES.................................................................................................. 77
REFERENCES ................................................................................................ 89
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1. INTRODUCTION
The aim of the thesis is to explain the turnkey construction project system to
international and Russian customers. First of all, it is necessary to define the
term “turnkey” and then find out how this system works in Karjalan Rakennus ja
Maalaus OY. The best way to understand the framework of turnkey is to look
through the construction project and to present material in a logical sequence.
In this case the term “project” will be explained. To make the work coherent, it is
decided to consider construction project through the prism of its lifecycle. In this
instance the collocation “project lifecycle” will be described. So, the project will
be looked through all its phases, beginning with contracting process to
preparing closing documents and warranty procedures.
The purpose of the practical part of the work is to create a technical brochure,
which will make the turnkey construction project system in Karjalan Rakennus ja
Maalaus OY clearer and usable for international and Russian customers. This
brochure should give a clear vision of the project for a customer. The most
important technical things of the construction project will be found out. The
most significant thing in this case is to correctly determine what things are the
most interesting for customers and influence on the purchase decision.
The main target of the thesis is to find out some new developments, which can
attract more international and Russian customers and to offer them to the
company. Some improvements, which can help the company in
expanding its consumer market, will be presented.
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necessary to understand what it means. First of all, these companies offer a full
range of services, namely, design, construction process itself and general
contracting. The company's work begins with a project of the house. Customers
can choose a ready-made project; otherwise they will be offered an
individual design. The execution of the house begins after project
approval. But before construction it is important to solve some theoretical
questions. Making all necessary documents is an important aspect in this case.
Secondly it is needed to find out what is “general contractor”. It is the company
engaged in the construction of the customer’s house, which takes the
responsibility not only in its construction, but also provides management of the
construction process from start to delivery to the customer. The most important
thing is to entrust it to professionals, who perform all work on time and at the
proper level.
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Development and construction. This service is designed mainly to private
consumers, they build using RS-system complied with the system’s
responsibility. RS-system is the law of regulation designed to protect the
customer. The construction company provides its shares to the bank as a
guarantee. The bank gives a bank guarantee to the customer, which
ensures safety during the construction;
The main activity of the company is construction of row houses and holiday
houses for private customers. Figure 1.1 shows row houses in Imatra made by
the company.
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He just needs to wait and get his new house in operation in full working order.
So after the final inspection the customer will get keys for his completely ready
house, equipped with built-in kitchen, domestic appliances, fireplace, ventilation
system, etc. The type of finish is also defined by the customer.
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other. Finland has a population of 5,282,583 people spread over 337,030
km2 making it the most sparsely populated country in the European Union.
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primeval cleanness, and countless lakes and forest ponds and meandering
steams and rivers whose total length is five thousand miles. Forests, mostly
conifers (pine and spruce) cover 80% of the territory.
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Figure 1.5. Views of South Savo
The South Karelia region is located on the eastern border of Finland, by Lake
Saimaa and River Vuoksi. The region comprises the cities and municipalities of
Imatra, Lappeenranta, Lemi, Luumäki, Parikkala, Rautjärvi, Ruokolahti,
Savitaipale, Suomenniemi and Taipalsaari.
The territory of the province is wedge-shaped and spreads between Lake
Saimaa and the state border. The uniqueness of the geographical location of
South Karelia is its boundary position between the European Union and Russia.
The main city is Lappeenranta, it is situated about 50 km from Vyborg. Another
big city in South Karelia is Imatra. It is a boundary city. It is about 10 km from
the centre of Imatra to the centre of Russian city Svetogorsk (former Finnish
Enso). Both cities are located on the shore of Saimaa Lake, the
distance between them is about 35 km.
Unique nature is the wealth of Finland. The South Karelian scenery features
rugged rocky stretches and lush deciduous areas with exceptionally diverse
fauna. The water system of Saimaa covers most of the region, in addition to
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which there are hundreds of other lakes with clear waters. Lakes, located along
the routes favored by migratory birds and waterfowl, are important for the global
ecosystem.
Change of seasons is the wealth of Finland. In South Karelia this feature of the
climate is even more marked as the area between the Saimaa and the Karelian
isthmus has cold and snowy winters and warm summers. Due to the beautiful
nature, lakes, rivers and islands there are all necessary conditions for a great
holiday in South Karelia. This is one of the best areas for active recreation and
ecotourism in the country. Here there is a whole range of different impressions,
the whole palette of colors and flavors, which Finnish nature can give – you can
fish, gather mushrooms or berries, swim, take pleasure in the warmth of the
sauna or simply walk through the forests, listening to the soothing symphony
performed by nature itself. There are views of South Karelia in figure 1.6.
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accomplish. Project management is a science or discipline that seeks to plan,
monitor, and manage resources in such a way as to bring about the successful
completion of a project’s stated objectives or goals.
The term “project” is a popular one that is bantered about in almost every
aspect of life. The use of the term in titles also has become in vogue in the last
few years. There is a variety of project managers, project analysts, project
coordinators, and project assistants running through the hallways of numerous
businesses.
Whenever a term begins to get such a broad usage in society, it will typically
tend to lose some of its specific meaning. It is certain that if someone were to
ask a group of individuals to write out a definition of the word, he would receive
a number of answers each having its own nuances. This is not to say that all the
definitions would be wrong, but might not be applicable to the very situation
where the term might be used. In this work a project can be defined as a
temporary endeavor that seeks to create a unique product or service and is
constrained by cost, time, and scope. Each part of this definition plays a critical
role in clearly understanding what exactly a project is, so each part will be
briefly considered.
Temporary endeavor. A project is by its nature a temporary undertaking. It has
a definite start date and a definite end date. During this time, the work that will
produce the goal of the project is completed.
A unique product or service. By unique it is meant that the product is one of a
kind. There is nothing more unique than a project that seeks to construct a
home. Even if one is building the same style of home on the same street, it is
unique. Even if one were to build the same style of home in the same area, a
variety of factors would be unique to each project, such as: land, weather,
subcontractors, materials, timing, client, etc. Because of the unique nature of
each project, special planning is required to make certain that the work of the
project is done properly and to the specifications provided. Building a home is
very different than running a batch of products through a controlled production
line, and because of these differences, the work must be managed differently. It
is the uniqueness of each project that creates the challenges that the project
manager must rise to meet in order to successfully complete the project.
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Constrained by cost, time, and scope. There are three constraints that are
present on every project – cost, time, and extent of the work. There is a set cost
or budget, a set time to complete the work, and a set amount of work to be
performed. In every project that is executed, one must grapple with these
constraints (Griffin 2010, pp 2-4).
3. PROJECT LIFECYCLE
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manager may realize that part of the project plan will have to be re-worked in
order to accommodate an unknown situation that has arisen, which will require
that a portion of the project needs to be re-planned and re-executed. This
iterative nature can be seen in figure 3.2.
The arrows in figure 3.2 that lead from the bottom of the execution and
controlling phase symbols back to the planning phase show that once the work
is performed and monitored it may need to be re-planned, passing through the
planning phase again constraints (Griffin 2010, pp 8-9).
4. INITIATION PHASE
The initiation phase of the project begins with an idea, the idea to build
something – a house, a duplex, a small commercial project. The idea could
come from an employee, the CEO, the contractor, or the customer. During the
initiation phase, the project manager is not concerned so much about the
source of the idea as with whether the idea can be transformed into a viable,
profitable project. The goal of this phase is to render a judgment on the idea.
In order for the idea to be considered, а process for analyzing it and a standard
or a scale against which to measure the results of the analysis must be in place.
The process comprises the steps required to gather the necessary information
to measure the project according to the standard. The standard is the criteria by
which the company decides to take on the project. If the process is faulty, the
proposed project will not be accurately measured against the standard. If the
standard is too exclusive, projects that could be beneficial to the company will
be rejected. If the standard is too inclusive, projects that will harm the long term
health of the organization will be accepted.
Ideas for construction projects can come from a variety of sources. Broadly
speaking, however, they will come from one of two sources. They will come
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from within the organization itself for the benefit of the company; this type of a
project is called an internally initiated project. Projects can also be initiated
externally or by someone other than a member of the organization. These
externally initiated projects are typically proposed by individuals, businesses, or
government or public organizations to meet their specific building needs.
Internally initiated and the externally initiated projects differ in some ways, but
they also share а number of steps. The internally initiated project is by its nature
a speculative project, as there is no specific purchaser or customer yet known.
The company is building the home or office building with the hope that а
qualified buyer comes willing, ready, and able to purchase or lease the property.
Because the company does not have this buyer in mind, it must choose where
to build the home, what style of home to build, how much to price the home, and
so on. With an internally initiated project, the construction company takes on
much more responsibility and risk. Once the company has accepted this
increased risk and chosen the site and the plan, then the steps of the initiation
phase are similar to that of the externally initiated project. The steps for each
type are below to compare and contrast them.
The steps in an internally initiated project:
1. Perform market research
1.1. Building plan and key feature list
1.2. List of acceptable locations
1.3. Financial needs analysis
1.4. Projected sales price
2. Create а summary of proposed work
3. Preliminary cost estimate
4. List key stakeholders
5. Preliminary risks and rewards analysis
6. Preliminary scope statement
By contrast, the externally initiated project will typically carry а much lower
degree of risk, because the customer is initiating the project. If the company
properly vets the potential client and takes proper steps during the contracting
phase, the company can have a high degree of assurance of being paid for the
work performed. Because the client will provide а location, а set of plans, and
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financing for the construction project, the initiation phase includes fewer steps,
as less research is necessary.
The steps in an externally initiated project:
1. Create a summary of proposed work
2. Preliminary cost estimate
3. List key stakeholders
4. Preliminary risks and rewards analysis
5. Preliminary scope statement
The externally initiated project will be considered in this work, as the most
typical way of starting a construction project. First of all, foreigners’ rights for
acquiring real property and construction should be discussed.
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the house is registered in the local municipality and pays taxes to the
municipality. A foreigner cannot be registered in the municipality and the
municipality will not receive money from taxes (except the annual tax on real
estate). Service lines are very expensive items for the municipality.
It was basic information about purchasing land by foreigners in Finland. Now it
is necessary to understand what the next step will be. So, the client has land
and comes to Karjalan Rakennus ja Maalaus OY. Firstly, a project manager
should be assigned.
Even before beginning the steps for initiating а project, the question of who will
lead the project should be considered. The project manager should be assigned
to the project as early as possible. The sooner the project manager can
assemble the core project team, the better it will be for the project. Some
companies may call this individual the construction manager. The title is not as
important as the function. The project manager is the individual who will be
responsible for planning, executing, controlling, and closing the project when it
is completed. Therefore, the sooner this assignment can be made to the project
the better.
The next step is to define the scope. As construction of holiday houses is
discussed in this work the next step is to select the house.
Before starting the initiation phase the house and the way of construction
should be defined. In general there are two ways of house planning and
construction in Finland. The first way is that a customer can choose a ready-
made house (standard house kit). The second way is an individual project; the
client may bring his own drawings made by himself or another architect.
Designing process will be more broadly discussed in chapter 5.
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After the choice of a house the next step is getting a building permit from the
local authorities.
For all construction work a building permit or some approval from authorities is
needed. The precondition for the application of a building permit is that the
applicant is the titleholder of the building site. Most often this means ownership
of the land or its tenement. The applicant shall have in his use a designer who
is approved competent and fulfils the regulated requirements.
The application shall include attached the master drawings of the building
where it is to observe that the construction will be in keeping with the local
detailed plan and fulfill the requirements set to construction. The basic
provisions for this are given in the Act and the more exact regulations in the
Degree and in the National Building Code of Finland. The basic rule is that for
construction of a house a building permit is required. For each site the building
right is determined individually. The building right is a document entitled to build
some facilities on the site. The building permit is required for the following
activities:
construction of the building itself;
repair and reconstruction works, which can be equated with the
construction of the building;
expansion of the building;
increase of the floor area (for example, the reconstruction of a cold attic
to a warm attic);
construction works, if they have an impact on the health and safety of
users of the building;
significant change in the operational use of the building or its part.
Every construction project is unique and represents a range of activities. The
final decision about the necessity of obtaining a permission is taken by the
authorities for construction supervision.
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4.5 The procedure for obtaining a building permit
As stated above, the purpose of the initiation phase is to perform the research
necessary to make an informed decision about whether to proceed with a
particular project. The information necessary to make that decision will depend
on the type and source of the project. What is needed is а process to move
from idea to project. There are four steps to initiate a project, regardless of
whether it is internally or externally initiated. They are:
1. Creating the project proposal
2. Reviewing the project proposal
3. Approving the project proposal
4. Transitioning to the planning phase
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4.6.1 Creating the project proposal
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statistically more reliable than the ballpark estimate as it typically has a plus-or-
minus 15-percent margin of variation. The final method is the definitive or the
bottom-up estimate. This method is both the most time consuming and the most
reliable estimate. With this method of estimating, the project manager will look
at each piece of work required to build the home and provide a detailed quote.
This is a very accurate method and typically only has а variation of 5 percent or
less.
List key stakeholders. Stakeholders are individuals who have a vested interest
in the project. Listing key stakeholders and their relationship to the project
provides critical information for the key decision makers. Stakeholders can be
ranked according to their potential influence on the project. There are some
sample classifications below:
1. Key stakeholders: The key stakeholder wields considerable influence
over the project. This could be the overseeing decision maker from the
company, who is called the project sponsor. It could also be people who
elevate themselves to this level because of their opposition to the project.
Other key stakeholders would include the project manager, the core
project team, the financing institution, and any other individuals and
organizations that could have a major impact on the project.
2. General stakeholder: General stakeholders are people who will have an
interest in the project, but their influence will not greatly impact the
direction of the project (construction subcontractors, the local
government officials).
During the initiation phase it is most important to simply identify and list any
concerns or cautions associated with each key stakeholder. A more detailed
approach to managing all stakeholders will be developed later on during the
planning phase.
Perform preliminary risks and rewards analysis. The construction industry is
abundant with opportunities to reap profitable and personally fulfilling rewards,
but it is also vulnerable to loss and failure. When considering a potential project,
it can be very helpful to list not only what the benefits of a project are, but also
what the potential pitfalls are. By carefully weighing the potential risks and
rewards, the builder can help ensure project success.
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Develop preliminary scope statement. The preliminary scope statement should
be seen as a guiding statement for the project. It sets the course to follow and
the boundaries to stay within. This is why it is wise for the scope statement not
only to include what work is to be included in the project, but also what work will
be excluded from the project. Therefore, the preliminary scope statement
should be a general statement about the work that is being proposed, as well as
the boundaries to that work. If the project progresses from the initiation phase to
the planning phase, the scope statement will need to be revisited and updated
to include the work that has been agreed on in the construction documentation.
After moving through these steps, a report should be prepared that will enable
the management of the company to determine whether to proceed with the
proposed project (Griffin 2010, pp 17-30).
Once the project manager has completed the above steps and gathered the
information into an appropriate report format, the report is ready to be reviewed.
Reviewing the project proposal is no mean task. The reviewer must be able to
analyze the report to determine, first, whether the report is accurate and,
second, whether the proposed project fits the goals of the company.
Reviewing the proposal for accuracy does not necessarily mean that the one
performing the review must rework all the numbers, but it does mean that he
should look at the report with a critical eye.
The author of the report could have also made a faulty conclusion from the
facts.
In order for pitfalls to be avoided, the reviewer needs some type of a standard
or baseline to compare the project against. This ensures that each project is
considered according to the same factors and that the organizational
competencies and goals are considered during the review process. This can be
achieved through а number of means or methods. For example, the
organization may develop а few different types of checklists to guide the
reviewer.
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In addition to these checklists and baselines, the reviewer must rely on his
general feel of the project. Not every project can be reduced to a set of statistics
and reports. The reviewer should possess the experience necessary to look at a
project, consider all the data, and develop a conclusion based on his
experience and expert judgment, which, if proven reliable, should weigh heavily
on whether the project should be accepted.
Once the review has been completed by the person within the company
responsible for such matters, the reviewer should offer a recommendation. If the
proposal is rejected, then the reasons should be noted. If the proposal is
recommended, then the proposal will progress to the next step: approval (Griffin
2010, p 31).
Approving the proposed project is an exciting step. Much work has been put
into developing the proposal, and the work has paid off, as the proposal has
been reviewed and given a positive review for approval.
Depending on the type of the project, the process for approving a project will
vary.
If the project is an externally initiated project, the approval process will most
likely be a little more involved than internally initiated because there are
competing parties involved. If the proposal is recommended, the builder must
outline the terms of the contract review by the client.
Most of the time, the company will have a standard contract form. The following
is a list of issues that are of primary concern to both the project manager and
the client and should be detailed in the contract:
Construction specifications
Contract price and construction budget
Quality standards
Construction time frame
Special clauses or notes
Inspection guidelines
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Builder warranty
Conflict resolution
After the contract has been prepared, then it will be reviewed and modified by
the attorney representing each party. Once all modifications have been agreed
to and the final copies have been executed, the time comes to transition to the
planning phase, which is the second phase of the project lifecycle.
Before transitioning to the second phase of the project lifecycle it is important to
pay special attention on the contract process in Karjalan Rakennus ja Maalaus
OY and also on the designing process.
25
addresses the construction techniques and materials. This avoids the
customer’s complaining of ignorance that a certain material was going to be
used in construction. The contract should also refer to some type of building
standard against which the construction could be compared.
Construction time frame. The clause that deals with the time allowed to
complete the construction project is utmost importance to the project manager.
If an unrealistic amount of time is allotted, the client should expect some
disappointment. The clause dealing with the time frame will typically also
include extensions that become necessary due to client change orders, natural
disasters, weather delays, material shortages, and other unforeseeable events.
It will also typically include a per-day fine for going past the target date, which
will be charged to the contractor.
Special clauses or notes. It seems that in almost every contract there is a
collection of special clauses or notes that does not naturally fall into any other
section of the contract. The builder should not draft these types of clauses or
allow the client to do so. The attorney for either party should both draft and
review any special clauses as a means of mitigating misunderstandings and
disputes that might arise from these unique clauses.
Inspection guidelines. The section on inspection guidelines should detail the
types of inspections the client can perform at various points of construction. By
implementing clear inspection guidelines as part of the construction contract,
both parties have clear expectations and understandings.
Builder warranty. There are two guarantee systems in Finland, this question will
be broadly discussed in chapter 9.
Conflict resolution. The final consideration is to address what remedies the
parties will have if one of the parties fails to comply with the terms of the
contract. Most contracts will typically call for some type of arbitration; the only
remaining remedy is the court. The builder should consult with an attorney to
make certain that the company is adequately protected before signing any
contract.
However, each contract is unique and the list of issues mentioned above can be
reduced or expanded. For example, a clause about additional works may be
added.
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The contracting process in Karjalan Rakennus ja Maalaus OY is very easy for
the client. In this stage new or changed space needs of the customer are stated
and various alternatives aimed at satisfying the needs are discussed. The
contracting process consists of two steps. The first step includes a start-up
meeting, on which customer’s needs are discussed. Presentation includes
project background, size and location. After this, preliminary plans are sent to
the customer, the company makes some changes if it is needed and gets the
permission from the customer. A first contract on obtaining building permit is
developed. The next step is to get a building permit from the authorities. After
obtaining the building permit a new contract is developed. During this process
triple-constraint components are defined: scope, time and cost. Environmental
management plan may also be integrated into contract documents. If
construction work is to proceed, the decision to start project planning is made.
The company prepares all necessary documents to start the project and the
customer just needs to sign. Rakennusurakan yleiset sopimusehdot YSE 1998
is used as a basis for drawing up the constructing of the contracts in Karjalan
Rakennus ja Maalaus OY.
5. DESIGN PROCESS
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If the client selects the standard project, an experienced architect will help to
correct the design of the house to satisfy all customer needs. So, every
standard home can be an individual home. This way is usually the most
economical way of house planning and construction.
Another possibility is to choose not standard house. In this case it is necessary
to design an individual project. The house can be completely unique, realized
according to the client’s own plans. The customer can draw a project himself
and then it will be corrected by the specialist from Honkatalot. Another way is to
bring drawings designed by another architect. And the last way of designing an
individual project is to do it with the help of the architectural department of
Honka Company. The best way is to trust for Honkatalot architects, because
they know all restrictions for construction, the modern rules of the Finnish
construction.
The second step in the designing process is to choose the way of the
construction of the house. The houses can be turnkey or not turnkey, the client
can choose everything that suits him.
As Karjalan Rakennus ja Maalaus OY works as general contractor, it has to
handle with rather a great amount of designers (architects, designers of HVAC-
system, designers of low current, etc), even so it manages with every designer
and works together as one system. The best way to successful handling is to
make a right choice of the main designer. He will be responsible for overall
project and also responsible for ensuring that highly specialized designers have
good qualifications in their fields (electrical work, water and ventilation systems,
etc).
6. PLANNING PHASE
The planning phase is the second phase in the project lifecycle. This phase is
different from the initiation phase in number of ways, but the most important
ways that it is different is that it is iterative. This means that the planning phase
is continually revisited throughout the life of the project. The planning never truly
ends until the project is completed and closed. Once the project has been
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initiated, the project manager moves to the planning phase, never returns to the
initiation phase; once the project moves from the planning phase to the
execution phase, the planning phase will be revisited as the project progresses
and conditions change.
Because all construction projects are different, the project plan will need to be
customized to match the needs of each project. There are components that
should be common to most project plans:
1. Project scope and scope management
3. Cost control
4. Quality assurance
5. Human resource
7. Risk management
9. Project baselines
The first step is to determine which portions are necessary – or rather, which
are not necessary. By default, every construction plan should contain the nine
major sections previously mentioned. If the project manager or a stakeholder
believes that one section is unnecessary, the reasoning for such a position
should be considered and decided upon. But by default, all nine sections should
be included. The project manager and the project team should also ask whether
there are any special features to the project that make another section
necessary.
29
By including all nine sections by default, the project manager can assure that a
comprehensive approach to planning construction project is being taking. Going
through each of nine sections helps to ensure that no portion of the project is
being disregarded or overlooked. The second benefit of including all nine
sections is that the project manager can work to eliminate the problems that
often arise from assumptions (Griffin 2010, pp 42-44).
The project has been researched, the project manager has been assigned, the
construction documents have been compiled (blueprints, material specifications,
etc.), and the time has come to actually develop the project plan. The next
section of the chapter provides a brief overview of the components of the
project plan, and some details are discussed.
As it was mentioned, one of the steps in the initiation phase of the project is
development of a preliminary scope statement. During the planning phase, the
statement will be revised and expanded, if necessary. It is not always necessary
to modify this phase as the project unfolds if accurately reflects the goals and
the boundaries of the project.
The scope of the project refers to what is and what is not included in the project.
This portion of the project plan will focus on accomplishing the following tasks:
1. Finalizing the scope statement
30
It is important to pay special attention on developing the work breakdown
structure (WBS) and WBS dictionary as it is a significant part of project plan.
WBS will be used in developing other parts of the project plan.
The WBS is a chart that shows the work necessary to accomplish the project. It
is a chart that is most easily understood by seeing an example, as shown in
figure 6.1. The WBS provides an excellent overview of the project. One of the
purposes of the WBS is to show how the project is internally related.
A second purpose of the WBS is to help facilitate the planning process, as it is a
very valuable planning tool. The WBS and WBS dictionary provide a wealth of
information for those planning the project. The WBS dictionary is a closely
related document, which provides details about each activity on the actual WBS
(Griffin 2010, p 45).
The steps to develop a WBS are:
1. Gather necessary documents (building plans, blueprints, material and
feature specifications, building contract, etc.)
31
Project
WBS
Paint Gutters
Floorin Land-
g scaping
Finish
Rough-
Ins
Trim
Finishes
32
The WBS dictionary performs three critical functions:
1. The WBS dictionary defines each element of the WBS
3. The WBS dictionary prescribes the processes to follow when carrying out
the work described
The construction schedule is the document that will guide the entire project. In
order to develop a construction schedule, the project manager must first
develop a work breakdown structure (WBS) and WBS dictionary, which seeks
to name and define all tasks necessary to contrast the structure. Developing the
construction schedule also requires sequencing of tasks, developing time
estimates, identifying the individuals or subcontractors responsible for each
task, and developing a method to control the schedule. Developing the
construction schedule is one of the most time-consuming portions of the project
plans. It involves carefully considering each task of the project and creating a
road map that will lead to project success. The steps to create a project
schedule are:
1. Define task
2. Sequence task
5. Develop schedule
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The cost control plan accomplishes three primary tasks. First, it estimates the
cost of each activity required to construct the building. The WBS is used as the
guiding document. Second, it develops a budget for the entire project. Last, the
cost control plan includes the information on how project costs will be monitored
throughout the life of the project.
Controlling costs is one of the major challenges of a construction project.
Almost anyone who has spent time in the construction industry knows of a
company that did not survive due to uncontrolled costs. Those who effectively
manage construction costs will fare much better in the long run than those who
do not.
In most situations the builder wants to control costs as much as possible. There
are two basic means to accomplish this goal: company-wide cost control
policy/procedures plans and project-specific cost control plans.
The steps of the cost control plan are:
1. Estimate costs
The quality assurance plan is focused on two items. First, it is focused on the
quality of the actual work. It is imperative that the project manager plans and
executes those steps necessary to make certain that the home being built
meets the expected level of quality. This implies that there is an understanding
that exists between the key stakeholders as to what the quality of the structure
should be. This means that not only is a specific level of quality planned for, but
it is also evaluated as construction progresses.
Second, the quality assurance plan focuses on ensuring that the project is
performing according to the plan. Developing the plan is a major undertaking.
But consider that someone takes the time to develop a plan, as has been
discussed and will be discussed, but the time is never taken to ensure that the
34
plan is followed. It is never verified that the budget is being followed, or that the
schedule is being updated, or that the potential project risks are being watched,
or that the change orders are being properly recorded and administered. This
would no doubt lead to the failure of the project. Therefore, the quality
assurance plan also specifies how to ensure the quality of the project itself.
The quality of both the construction work and the project work is planned and
documented in the quality assurance plan.
The human resource plan is primarily concerned with how people will be hired,
how they will be developed or trained, if necessary, and how they will be
managed. This applies to not only employees of the construction company, but
any subcontractors that might be hired to work on the project. Much of
residential construction is outsourced to subcontractors. Therefore, project
managers must have definitive approach to acquiring, developing, and
managing subcontractor teams.
А construction project will hire primarily two types of people: internal employees
and subcontractors. Internal employees are full-time or part-time employees of
the construction company. Subcontractors refer to those companies or
individuals hired from outside the construction company to perform a specific
task on the project. So the human resource plan will deal with both types of
people.
The human resource plan focuses on the following steps:
Determine staffing needs
Acquire staff
Ensure compliance
35
Ensure safety
36
How should information be sent?
Risk is a natural part of any undertaking. Every action taken, and even inaction,
carries a degree of risk. In the context of this work, risk refers to an unforeseen
event that causes a deviation from the project plan. Using this definition, risk
could refer to both positive and negative events. For example, if the cost of
certain material drops during the course of a project, this is a positive risk event.
If a subcontractor suddenly goes out of business, this is a negative risk event. It
is important that the project manager attempts to plan for all possible risk
events, both positive and negative, by creating a risk management plan as a
part of the main project plan.
The risk management plan is composed of two major sections. In the first
section, the project manager identifies and analyzes risks and plan responses.
In the second section, he develops a plan to monitor the various parts of the
project so as to identify problems either before they arise or before they have
done much harm to the project.
37
developed and that the plan is followed by a qualified individual. The actual plan
includes:
1. Purchase management
2. Subcontractor management
3. Contract management
This section of the project plan is primarily a reference section. First, it contains
the documentation that guides the project, such as:
1. Project contract
3. Site survey
38
results, the project manager can determine whether the project is on schedule
or within the cost guidelines. Failing to compare actual results with planned
results can lead to unexpected delays or cost overruns, which might have been
avoided if the project manager had taken the time to analyze the project's
progress.
Much time has to be spent on the planning phase of the project. This is not
because the other areas of the project lifecycle are unimportant. It is because if
more time is invested in the planning phase of the project, less work will be
required down the line. This may seem incorrect, as nothing gets physically built
during the planning phase, so most contractors do not see the point in spending
so much time doing it; they would rather get to the execution phase. If the time
is invested during the planning phase, the execution phase is simply a matter of
executing the plan while making the necessary adjustments that will most likely
be required. As the project manager becomes a better planner, the adjustment
will decrease. By spending the time necessary to thoroughly plan a project, the
project manager can dive into the execution phase knowing that he is prepared
for the work at hand.
The project has passed through the initiation phase and most, if not all, of the
planning phase. The project team has been researching different aspects of the
project, analyzing potential problems, developing solutions, and is now ready to
see the actual work of the project begin. Everyone is ready to see that
proverbial first shovel go into the ground.
In some ways, the execution phase is the easiest and the most difficult phase of
the project. It is easy in that now the project manager must simply execute the
well-developed plan. But it is the most difficult because he must manage the
39
work. The work has been planned well; now the time comes to work the plan.
This requires both discipline and flexibility. If a project manager lacks the
discipline to follow the plan, he will most certainly fall short in some way.
Likewise, if he is unwilling to adapt the plan to real world conditions, he will be
disappointed again and again.
This chapter focuses on executing the main constructions of the typical Finnish
holiday house.
The main characteristic of the construction in Finland is using the prefabricated
elements. These systems provide some benefits, which are important due to the
conditions in what the construction works are made. The main reasons for using
prefabricated systems are:
Climatic conditions: because of the climatic conditions, it is important to
minimize the works that are made outside or in the building sites. It
makes using prefabricated elements suitable, which are made on the
factories and that are needed for the minimum works in the construction
site.
Economy: using the prefabricated system allows reduce the building site
staff to the minimum as it is only needed to place the prefabricated
elements in their places. Moreover, using these systems avoids the
mistakes in the construction process.
40
Shallow foundations
o pad foundations
o strip foundations
o raft foundations
Deep foundations
o piles
o pile walls
o diaphragm walls
o cessions
The type of the structure determines the type of foundation. There are different
types of foundations for different types of holiday houses: the foundations-cellar,
columned foundation, foundation-slab, ventilated basement foundation,
combined – basement foundation with a foundation-slab, etc. The type of
foundation depends on the quality of soil, the level of the slope of the
construction site, the necessity of drainage of the soil of building site.
Foundations made of Leca blocks will be described in this work. The selection
of the foundation method is mostly affected by the quality of the building base,
the shape and purpose of the building, structures to be used, and the location
and elevation of the building site.
The absolute starting point in design is the flawless and reliable functionality of
the foundation with regard to strength, heat insulation and damp-proofing. The
basic Leca block types with different actions and structures are presented in
figure 7.1. Different foundation types can be used side-by-side in a single
building.
41
Figure 7.1. The most common Leca Block foundations
The foundation structures prevent ground moisture and surface waters that
drain into the ground from penetrating the structures and interior areas.
The adverse impact of moisture can be prevented by securing the drying of the
building base using drains and by building the required damp-proofing. In order
for rain and melt water not to stagnate against the wall, the ground surface is
shaped so that it slopes away from the building by at least 15 cm in a distance
of 3 m. In order to prevent moisture from rising to the floor structures from the
ground, a layer of at least 200 mm which cuts the water capillary rise is installed
under the floor using Leca gravel suitable for the purpose. A layer of at least
200 mm of well-penetrable gravel is installed next to the plinth, footing beam or
cellar wall. Leca Geosack acts as a drain layer and additional heat insulation
next to a wall.
Wooden structures are always isolated from foundations using damp proofing.
The joint between the footing timber and foundation is always sealed against air
leakage. A strip of rubberized bitumen or closed cellular plastic or polyurethane
foam can be used as insulation or sealant. Even though the water capillary rise
height of water is low in Leca blocks, brick structures are also damp-proofed in
the foundation (Maxit Oy Ab, 2008)
42
7.2 Frame works
Timber frames are manufactured in Finland and are usually made of solid pine
from sustainable forests in Northern Finland. The timber frame allows for a high
level of insulation. They are thermally efficient, reduce the cost of heating and
produce to exceptional standards.
43
The timber frame is produced with high tech computer driven machinery
ensuring precision cutting and jointing. The timber frame arrives at a building
site pre-cut and drilled ready for slotting together and fixing. Different stages of
production of the house are shown in figure 7.2.
A typical Finnish bearing frame is wooden columns with the step of 60 cm. The
cross section is 50x220 mm. They are connected to the basement by anchors.
For this purpose, a special block is filled with a concrete mix, which is drilled
after getting hardness. The anchor is hammered through the bitumen material
and it can be regulated by two nuts. Finally, the column is connected by metal
shoes. Also holiday houses can be made of logs. The best log for the building is
made of softwood. Exterior and interior view of the house depends on the type
of the log. Different companies offer different types of logs, for example Honka
Talot Company offers logs shown in figure 7.3.
a) b) c) d)
e)
Figure 7.3 Types of logs made by Honka Company
a - the round log from the single body
b - round “HONKA Duo” log
c - vertically laminated log
d, e - rectangular multi-laminated log
44
7.3 Waterproofing of the roof
waterproofing: it protects the insulation and rafters from moisture that can
condense on the roof covering, or penetrate under the roof covering
during slanting rain and strong winds;
Figure 7.4 The impact of climatic factors and human activities on the condition of the roof
vapor barrier: it prevents entry of water vapor from the interior premises
to the insulation, helps to preserve its insulating properties. In addition,
vapor barrier is necessary to prevent bulging of the roof elements that
appears due to accumulation of steam;
45
ventilation system: due to ventilation, moist air is removed from the
interior space of the roof by convection or by using special devices.
46
Films are one, two or three-layer materials consisting of polypropylene fabric,
which provides waterproofing of roof structure. Woven polypropylene high-
strength cloth has an absorbent layer which is a combination of viscose and
polypropylene.
7.4 Materials
For finishing outside materials, wooden panels are usually used (see figure 7.8).
47
it is possible to preserve nature almost intact, also this provides the external
beauty, the aesthetics of the construction.
The next layer in outer wall is air layer. In winter, the air masses, which include
water vapor, will pass through the permeable structure of the outer wall from the
inside out. The temperature of the air mass will decrease as it approaches the
outer surface of the wall. The presence of the air gap can divert water from
accumulating structure.
The following layer is wind stop layer, hard thermal isolation materials are
usually used for wind barrier, the most common materials are XPS (eXtruded
PolyStyrene) and EPS (Expanded PolyStyrene).
As it has been mentioned above a typical Finnish bearing frame is wooden
columns with the step of 60 cm. There is thermal isolation between these
columns. Thermal insulation is the element of construction that reduces heat
transfer. The most common materials for insulation are inorganic – mineral
wool and its products (for example, mineral plates).
As a finishing material for the socle plaster is commonly used, also stone
(natural or artificial) can be applied.
After the erection of a house the final step is always interior decoration. By the
end of finishing works the house gets lived-in appearance. How nice it would be
depends on the quality of interior finishes. First of all, the most common
materials used for interior walls are considered.
Interior wall paneling (see figure 7.9). The advantage of the wooden lining is
that it is environmentally friendly, vapor permeable and easy to install. A room
with wooden clapboard looks warm and cozy. The disadvantage is that it
requires staining or impregnation.
Gypsum plasterboard. These are panels of different sizes (thickness is 9-15
mm) with gypsum content, pasted on both sides of a special board or fiberglass.
Their use allows obtaining smooth wall of a small weight. In addition, gypsum
has increased the measure of fire resistance. Joints of panels are stuck with a
48
special tape, after this the entire surface is puttied, primed and then painted or
glued with wallpaper according to the client’s wishes.
Textile wall coverings (see figure 7.11). Textiles are often used to decorate the
walls of rooms: bedroom, living room, cabinet, nursery. This covering is elegant
and practical.
The ceiling is often the last thing to pay attention to in a room, but without a
good ceiling the interior is risked to look not stylish and elegant. With properly
chosen colors and finishing materials for the ceiling, the space of the room can
be visually enlarged, a small dark room can be a spacious and light, giving the
interior a finished look.
49
The choice of finishing materials for the ceiling is determined in accordance with
the planned type: suspended ceiling (consisting of tiles), stretch (a leaf) or
colored (or covered with wallpaper).
50
consists of the square or rectangular panels and the suspension system.
Cassette suspended ceilings are characterized by the following advantages:
durability;
the possibility of a combination of models;
hygiene;
moisture resistance;
fire resistance;
the possibility of embedding lighting and climate systems;
quick installation.
51
Figure 7.14 Rack suspended ceiling
Sretch ceilings (see figure 7.15). Stretched ceiling is a perfect opportunity to
quickly and easily create a smooth surface of the ceiling. Material for
suspended ceilings is available in several textures of surfaces and can have a
varied color scheme. Stretch ceilings have a number of advantages:
environmentally friendly;
water-resistant;
strength;
preservation of height of the room;
variety of forms;
lighting;
variety of colors and textures;
easy installation;
“clean" installation and removal.
52
decoration does not suit all rooms. The kitchen ceiling is invariably
contaminated with soot and grease vapors, and in the bathroom it can be
destroyed by moisture.
Ceilings with decorative painting (see figure 7.16). Art painting ceilings can
create a special atmosphere in any room. Each interior is individual, but the
painted ceilings in the apartment will emphasize this individuality.
53
Figure 7.18 Laminate floor
Linoleum floors (see figure 7.19, a) are widely used as flooring in homes. This
material is cheap, hygienic, easy in operating. Also a very popular material is
carpeting (see figure 7.19, b). Floor covered with carpet is warm, soft and non
slippery. The disadvantage of a linoleum and carpeting floors is short life cycle
(5-10 years). But it also means that the boldest color options can be chosen,
which will suit the planned color of the walls, doors and furniture.
a) b)
Figure 7.19 a – Linoleum, b - carpeting
Floor tiles (see figure 7.20). As a material for interior decoration ceramic granite
can be used in almost any room. Its main features are to provide exceptional
strength, low permeability to water and frost.
54
professionals. The most modern and most environmentally friendly building
materials are used for construction.
The project must be not only executed, but as the work progresses it should be
monitored so that deviations from the project plan may be corrected when they
arise. The next chapter will cover the fourth phase of the project lifecycle –
controlling the construction project.
The first three phases of a project lifecycle (initiating, planning and executing
the construction project) progress in a rather linear manner. Once the project is
initiated, then it is planned; once it has been planned, it is time to execute the
plan. While the execution phase progresses, there is another phase also in
process – the controlling phase.
The controlling phase contains processes that are necessary to carry out two
tasks. First, processes ensure that the plan was being followed in the execution
phase. In this case, the controlling phase is concerned primarily with monitoring
both the quality of the work and the quality of project manager’s performance. In
order to monitor the work, a number of performance evaluation techniques and
inspections, which compare the actual work of the project to the planned work
of the project, are used. The comparison provides data for informed decisions
about the execution of the project. The data is used to correct any problems or
deviations that occur during the execution phase.
The second aspect of the controlling phase is integrated change control.
Sometimes it becomes necessary to modify the project plan, usually there are
two reasons to do this. First, the client may modify the construction plan, this
would be in the form of the construction change order that specifies the work
the customer would like to have modified. A second aspect of integrated change
55
control concerns how the project plan is actually changed. The project manager
will have in place a process for modifying the project plan and informing those
parties who need to be aware of the modification. If this is not done, then
problems, that can threaten the success of the project, can arise.
The controlling phase works in close tandem with the execution phase of the
project. While the project is being executed, the project is being monitored and
controlled. Each phase informs and interacts with the other, which means that
certain activities are not easily distinguishable as execution processes and
controlling processes, but sometimes blur together. The point is that while the
work is being executed, it also is being controlled as a means of making certain
that the work being executed is the work that was planned.
Therefore, controlling phase is a rather broad field. In this work the aspects of
quality control will be discussed as this part of controlling process is the most
interesting and important for the customer.
The quality of the work is a major area of the project that must be controlled.
Two main aspects of quality control are involved. Firstly, quality control
concerns to the quality of the craftsmanship of the house. Secondary, quality
control can refer to the skill with which the project is being managed. The
project manager is concerned with both these aspects. He must make certain
that the actual work of the construction project is performed according to the
standards set in the contract and the building specifications. He must also make
sure that the way the project is managed does not lead to mistakes, schedule
delays, or cost overruns.
The quality of the workmanship is controlled through inspections. Project
manager should inspect the work as it is done to ensure that it meets the
specifications set out in the project plan. The objective is to reinforce the idea
that one should work the plan and inspect the work – the key to success in
construction management. One of the tools that project manager can use to
inspect the work is a checklist. Checklists should be done for each construction
56
project, as each project has its own design and challenges. The purpose of the
checklist is to make certain that the work is performed in conformity with the
specifications found in the project plan. Checklists can be created rather easily
and offer a great tool for ensuring quality craftsmanship.
The project manager is also concerned with making sure the project
management meets a high standard. Regardless of the quality of the plan, if the
project is poorly managed and executed, the project is destined for delays, cost
overruns, and various amounts of rework. The project manager can avoid this
by ensuring that the procedures for ordering materials, scheduling
subcontractors, issuing payment, and all the other aspects of the project are
followed as outlined in the project plan. Poor management typically shows itself
in poor workmanship; a project that is poorly managed will be poorly executed.
(Griffin, 2010, p189)
The local building supervision authority, based on the public interest, supervises
building and ensures that the provisions and regulations are observed in
building activities (Land Use and Building Act §124).
Supervision takes place at the stages of work and on the scale decided by the
authorities, and focuses on aspects that are significant to achieving a
satisfactory end-result (Land Use and Building Act §149). The quantity of
inspections is indicated in the building permit. In practice, the scale of
supervision depends on local building supervision authority, degree of difficulty
of the building project, professional skill of people responsible for the planning
and implementation, area of a house and other factors influencing the need for
supervision. The most general inspections during the construction are
inspections of plot, foundation, frame and networks.
After the inspection of reinforcement and foundation works, the correct location
of a building on the site and its height position are checked in accordance with
the project. Drainage system, derivation of ground and surface water are also
examined. The inspection of the frame is carried out right after its erection
before loading structures will be hidden. As the works on the installation of
57
engineering systems advances, the responsible site manager invites the
inspector for the formal acceptance of water and waste water systems.
The results of the inspection of water and waste water systems are written in
the protocol, which is presented to the building inspector during the final
inspection. The testing of electrical equipment is performed by a skilled
electrician. He makes the report of inspection and the final drawings. The
inspection of pipes is carried out for testing the fire safety of the building. The
check-up is executed by representatives of fire supervision authority only or
often together with the building inspector.
The local building supervision authority also takes charge of general steering of
the building and related advisory services needed in the municipality (Land Use
and Building Act §124).
When approving a supervision plan, the building supervision authority decides
where supervision by the authorities is not required (Land Use and Building Act
§151).
An independent municipal inspector comes after every ready phase to approve
the work.
The customer can see the results off all tests when it is necessary for him. The
most common tests are:
soils inspection
moisture in floors
For further consideration these inspections have been chosen. Selected issues
are the most common for Finnish building sites and rather easy for client’s
understanding.
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8.1.2 Soils inspection
The most typical tests that are done in building sites for quality are: sieve
analysis, plate-bearing test, balloon density apparatus and proctor compaction
test.
The Proctor test is a test that is used in geotechnical engineering to find out the
maximum density that can be practically achieved for a soil or similar
substance. The Proctor soil compaction test is performed by measuring the
density, or dry unit weight, of the soil being tested at different moisture content
points. The aim of the soil test is usually to determine the optimum moisture
content for the soil. In addition to soils, other substances, such as aggregate,
gravel, or sand, may be measured.
Soil testing equipment used for the Proctor test usually consists of a mold of a
standard shape and size, and a device, such as a hammer, for compacting the
soil into the mold. When soil testing machines are used, they must be able to
measure how much force is applied to the soil in the mold. The hammer or other
compacting tool is used to compact the soil or aggregate in the mold. In this
scenario, compacting the soil means increasing its density by forcing air out of
the soil. Different stages of the proctor compaction test are shown in figure 8.1.
59
how these risks may be mitigated by making optimum use of aggregates and
other physical materials. An example of where the Proctor test may be used in a
construction project might be in the selection of which aggregate to use in the
foundation of a building (Martin, 2012).
60
Figure 8.2. The process of working Gann Hydromette
61
The camera makes two photos: thermal image and normal image. Thermal
image allows determining surface temperature. This makes infrared camera
analysis rather demonstrative. There is an example of thermal images made by
FLIR ThermaCAM 695 in figure 8.3.
To determine air tightness, or the amount of air leakage in a house air barrier a
blower door test is used. The Blower Door (see fig. 8.4) is a diagnostic tool
designed to measure the air tightness of buildings and to help locate air leakage
sites. While using the blower door, the main goal is to measure air leaks of the
building. The Blower Door consists of a powerful, calibrated fan that is
temporarily sealed into an exterior doorway. The fan blows air into or out of the
building to create a slight pressure difference between inside and outside. This
pressure difference forces air through all holes and penetrations in the exterior
62
envelope. By simultaneously measuring the airflow through the fan and its effect
on the air pressure in the building, the Blower Door system measures the air
tightness of the entire building envelope.
The closing phase is the last phase in a construction project lifecycle. First the
project was initiated, then it was planned, then it was executed, while it was
executed it was controlled, and now it is time to close the project.
In general, closing the project involves assuring completion of every aspect of
the project, not only for the project manager but also for various stakeholders of
the project. Everyone has his or her own list of completion requirements before
the project will be closed. The closing procedures primarily focus on the tasks
involving the project manager and the client but will also possibly include
subcontractors, vendors, team members, financial institutions, attorneys,
surveyors, engineers, building inspectors, and any other stakeholders. During
63
the planning phase, the project manager developed a preliminary plan for
closing the project, but that plan must be revisited and updated with any new
information that might have come to light during the execution of the project.
Closing procedures cover a wide range of both topics and stakeholders. At
minimum, closing procedures will cover the following areas:
Client
Building site
Project file
Project team
Audit procedures
9.1 Client
Most project managers are quite familiar with procedures and issues involved in
closing the aspects of the project directly related to the client. The focus on the
client-related issues is appropriate, as these issues are the most critical aspect
of the closing phase. If the project manager can successfully close with the
client, the rest of the closing is typically merely a matter of paperwork.
Typically, when closing and construction are uttered in the same sentence, one
thinks of the closing that takes place at the attorney's office or at the bank,
when the title is transferred to the client, and the seller or builder receives
payment for the property. Although this is an important and integral part of the
closing phase, it is only one part. There is much work that must be done to get
to this point, and there is some work to be done after this point. Because,
64
however, the closing transaction is such an integral part of the closing
proceedings related to the client, it will be treated as a hinge or reference point
for this section of the chapter. The information will be presented in a linear
manner, starting with some of the steps that are part of the construction WBS,
which lead into these final closing procedures.
Final inspection
Document Prep
C/O
Final Client
Procedures
Warranty
Approval
Closing
Closing
Figure 9.1 Client related closing procedures
As can be seen from figure 9.1, there are a few steps that lead to the official
closing with the client, and there are a couple of steps that follow.
The final inspection is performed by the local building inspection office to ensure
that all work that has been completed on the home is in compliance with the
applicable building codes and zoning ordinances. Depending on the area and
guidelines applicable, this may be a one-time inspection, or it may require a
couple of phases. Regardless of the process, it is required before the builder
can acquire a Certificate of Occupancy, which is the authorization from the local
regulatory board stating that the home can now be occupied by a resident.
The certificate of occupancy (C/O) is one of the most important documents that
the builder acquires, because it states that the home meets the applicable
building and zoning codes. With this document, the client can have the power
turned on, the water turned on, and obtain insurance with a homeowner's
insurance policy.
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9.1.3 Final client approval
After the final inspection is completed, the WBS calls for a series of inspections
to be performed by the client or the client's agent. Often times, the client will hire
an independent home inspector, or an architect associated with the project, or
an engineering firm to perform the final inspection with the client. Typically,
these inspections focus on more cosmetic issues than structural or mechanical,
but the latter may also be included.
Receiving the final approval from the client may take a couple of inspections
and re-inspections. Regardless of the process, the project manager must
receive final approval if he hopes to close on the project. Sometimes, legitimate
disagreements will arise as to whether some aspect of the work is in
compliance with the construction contract. When these types of disputes arise,
the only party that can interpret what exactly the contract states is the courts.
Arbitration may work, but arbitration simply tries to get the parties to reach an
agreement through varying degrees of compromise. Only the courts can provide
a definitive determination as to what is and is not in compliance with the terms
of the construction contract.
After the client has given final approval, the project manager is almost ready to
meet the client at the closing table in order to sign all the final documents and
receive final payment. Typically, the closing date will have been set by the client
and the client's financier at a time beyond the final inspection, to allow time for
the punch list items to be addressed. During this interim period, the builder
gathers certain documents that are required for the closing.
During construction, the project manager compiles a project file filled with
various documents. Included in this file are various reports and records, which
will be pertinent and necessary for the closing. Items such as the soil inspection
report, any engineering reports, surveys, inspection reports, wood-destroying
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insect treatment reports, lien-waivers, and any other documents that were
obtained during construction are included.
Another document that needs to be prepared is the final financial statement for
the project. Invariably, the client will have made changes during construction,
which will most likely lead to an increase in the cost of the project. If there are
overages, the project manager ensures that all costs are included and that
documentation is available to support those extra charges. In preparing this
financial statement, the project manager must be both detailed and clear. The
client should be able to read the document without much trouble; it should not
be so detailed as to make it overly confusing. Typically, the financial statement
is in summary form, and the project manager will be able to provide supporting
documentation if a request is made.
Once the documents required for the closing have been compiled, the project
manager or the representative from the construction company is ready to attend
closing to receive the final payment for the project.
Construction projects and construction contracts come in all types and forms.
Because of this, the role the builder takes at closing can vary.
There is, however, one thing that the builder is always seeking, regardless of
the actual closing process - final payment. The builder might have been
receiving payments throughout construction, or very few to no payments. At
closing, the builder always expects to receive a check.
In addition, it is a good idea for the builder to provide a packet to the client that
includes copies of all the documents discussed in the previous section. This
way, the client will not call in a few years looking for a document that the builder
has long ago archived.
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9.1.6 Warranty procedures
The centrality of the building site through the construction project means that a
number of items will be stored and misplaced there. After the final inspection
has been completed, and the client has approved any items that were noted in
the inspection reports, the building site must be transformed to a home for the
client. A thorough cleanup is performed first. The interior and exterior of the
home are combed through to remove any remaining items associated with
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construction. This way when the client arrives, he will be ready to begin moving
into the property.
Depending on the project, there may be some unused materials that must be
returned. Whatever is done with the unused materials, the accounts must be
reconciled with the client to make certain that he is reimbursed for any returned
items. If any tools or other equipment have been rented for the project, it will
need to be returned as well.
After the materials have been returned or transferred, the equipment has been
returned, and the job site has received a final cleaning, the project manager will
be ready to close this aspect of the closing phase.
Accounts payable
Lien waivers
Performance reviews
Closing work contracts simply involves reviewing the contracts related to each
stakeholder and ensuring that each party has met the contractual obligations.
Without question, the stakeholder will have already performed the work
contracted for, but the contract may call for additional services, such as a follow
up inspection report or a warranty document. Whatever the terms may be, the
project manager is responsible for ensuring that both parties have met the
terms of the contract before closing out the project. If a stakeholder has not met
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his obligation, the project manager will be responsible for taking steps
necessary to ensure that the terms are met.
As part of the contract review, the project manager reviews the accounts
payable to make certain that all payments have been made to those who
participated in the work of the project. The next item the project manager must
acquire is a signed lien waiver from all subcontractors stating that they have
received payment in full for any and all work performed on the project.
The last item related to construction stakeholders is performance reviews. Often
project managers do not think to provide performance reviews for stakeholders,
because these individuals or companies are not direct employees. It is unlikely
that the stakeholder would receive criticism well. However, this should not
hinder the project manager from doing performance reviews, even if they are
only used internally. For a construction company that wants to develop a
reliable base of vendors and subcontractors, this will prove to be a very helpful
tool.
Project file is a broad term that can cover any number of documents associated
with the project: baselines, planning documents, work and purchase orders, and
work contracts. In this part of the closing phase, the project file is closed out and
prepared as a future reference document. The first step is to review the
information and update any documents to reflect actual results. This way when
someone looks back at the project, he will see information that reflects the
actual results of the project, not the results that materialized at various points in
the project.
The second step to closing the project file is completing any project lessons
learned reports. In general, a lesson learned is exactly what it sounds like - a
lesson that the project manager or project team learned during the project. It
might, for example, refer to a lesson learned in planning the project or executing
the project. It might relate to a certain type of material or building technique, or a
lesson associated with a certain vendor or subcontractor.
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The final step in closing out the project file is to prepare it for archiving. This
typically involves two steps. First, it involves making certain that all the parts of
the project file are present in final form and properly ordered. Second, the
project manager creates a summary and table of contents for the project file.
The summary should include the highlights of the project, such as the parties
involved, the type of home built, the construction time, the budget, as well as a
comparison chart showing the performance of the project. The table of contents
acts as a guide showing the reader what documents are available in the project
file, so that he will not waste time seeking something that is not present to begin
with. On a secondary note, the person performing this job should make certain
there is no personal information present in the file that could compromise the
identity of a party involved. This information should be blacked out or shredded
as a safeguard.
Another option that is becoming more popular is to keep a paper file for a
couple of years but to create a digital file for long-term storage. This is a great
help when preparing for future projects, as one can simply open parts of the file
and update it to reflect the realities of the new project. This is a solution that
should be considered seriously by any builder who wants to use past files in a
meaningful and productive manner.
The project team is also one of the aspects of the closing phase that needs
special attention. Depending on the size of the organization, the project team
may only be the project manager, or it may comprise a number of people
performing the various tasks of the project. If the project team is the project
manager, this is a fairly easy step. The purpose of this step is to provide
performance reviews of the members of the project team and to reassign
project team members to new projects.
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9.6 Audit procedures
While all the previous work is going on, the project manager or an assigned
team member must oversee all of it to ensure that it is done properly. Making
certain that the project closes well is an important aspect of project success.
Typically, the person assigned to oversee the closing is merely working through
the closing plan that was developed during the planning phase of the project.
In this section closing procedures concerning the client will be discussed. First,
the company makes its own inspection, they have one week to fix all mistakes.
Then it is time to authoritiy checking. Authorities monitor that the quality of work
done by the contractor is determined by the contract, or demands that are
usually imposed on the work of these kind. Authorities can give the certificate of
occupancy. The company presents to the client the results of the final
inspection. Moreover, the customer can hire an independent home inspector, or
an architect associated with the project, or an engineering firm to perform the
final inspection to the client. After this final inspection the client makes a list of
mistakes, the company fixes the mistakes during 1 week. The customer may
take a couple of inspections or re-inspections before giving the final approval.
The warranty period is started from the date when the approval is received.
10. CONCLUSIONS
The purpose of my thesis was to give a clear vision of a project for the
customer, to find and tell the most important technical things of a construction
process, which are interesting for customers and influence on the purchase
decision. The terms “project” and “project lifecycle” were explained in this work.
The phases of the project lifecycle were looked through from initiation to closing
the construction project. After reviewing these phases it was found out, that the
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construction process is rather complicated for foreigners in Finland. A person,
who starts the construction of a house, is required to ensure the compliance of
Finnish building rules and regulations, as well as the conditions for obtaining a
building permit. The planning of the construction process is a precondition for a
successful completion of a project. The planning should be carried out at all
stages of the construction process. Each step should be approved by local
authorities. During construction and controlling phases, the developer has to
solve a lot of problems, such as obtaining permits, making applications, sending
requests, inviting tenders for a contract, communicating with officials and
observing the laws and regulations. Also the construction of a house requires
time and the customers who have not a permanent place of living in Finland will
have some problems with the monitoring of the construction. Closing phase is
also difficult for a foreign client, because all closing documents should be
prepared, the final inspection should be completed, all contracts with
subcontractors should be closed, etc. These procedures are rather complicated
for inexperienced foreign people.
Thus, building a house in Finland is a very difficult process and the best solution
for the customer is to trust the professionals. The easiest way is to choose a
turnkey construction project system – from obtaining a building permit in Finland
to equipping furniture and built-in appliances. Karjalan Rakennus ja Maalaus
OY offers this system to the client. The company will do everything to protect
the customer from all possible problems, which he even does not know. At each
stage the construction is under the watchful eye of professionals, which allows
build objects without the presence of the customer. To make a turnkey
construction project system in Karjalan Rakennus ja Maalaus OY more clear
and usable for international and Russian customers a technical brochure was
created, text for this brochure in English is attached in Appendix 1 and in
Russian in Appendix 2.
The main target of the thesis was to offer the company some new
developments, which can attract more international and Russian customers.
First of all, it is important to pay attention to client feedback. A survey should be
developed individually for each client and sent to him, as well as some type of
present for completing the survey, such as a gift card to home improvement
store or local restaurant, branded pen or calendar, etc. The received feedback
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should be analyzed and discussed among the members of the project team.
Both positive and negative feedback provide the opportunity for the company to
improve its performance and correct any past mistakes.
Currently, only rich Russian people can buy real estate in Finland, the middle
class does not have this opportunity yet. Mortgage credit lending is very popular
in Russia nowadays especially among middle class. Foreigners can apply for a
loan for the construction or purchase of real estate (houses, villas, cottages,
land). The laws of Finland do not preclude it. The client only needs to
understand that, as in any other country, he should have a logical and
convincing motive and explain the purpose of his request for credit. The
average term of the mortgage loans for foreign people is about 10-12 years.
The real interest rate on mortgage is about 3.5-6% nowadays, it is less than in
Russia where the rate is about 9-14%. That is why, it will be good for the
company to connect with one of the Finnish banks and help the client to get a
loan. Thus, the company is expanding its consumer market.
Another problem for foreign and Russian customers, that requires a solution, is
the so-called "language barrier". Language barrier is a figurative phrase used
primarily to indicate the difficulties faced when people who have no language in
common attempt to communicate with each other. To overcome this barrier and
to attract new clients, firstly an English version (or even English and Russian) of
the website of the company should be made, as rather a small amount of
foreign customers know Finnish, and the search for a construction company
abroad almost always occurs through the Internet in modern life. Also it will be
useful if the company has an employee who speaks English and can answer all
customer questions. In addition, despite the fact that knowledge of English is
necessary for life in the modern world, there is a possibility that a foreign client
may not know it. In this case the company can help the client and provide an
interpreter for him. Speaking in his native language, the client will not only feel
more confident but also be able to express more accurately his preferences and
wishes, which will undoubtedly benefit the company.
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FIGURES
75
Figure 8.1. Differet staged of the proctor compaction test, p. 59
Figure 8.2. The process of working Gann Hydromette, p. 61
Figure 8.3. Example of thermal images, p. 62
Figure 8.4. Blower Door, p. 63
Figure 9.1 Client related closing procedures, p. 65
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APPENDICES
78
79
80
81
82
83
84
85
86
87
88
REFERENCES
A printed book:
Hakola E. 2008 Saimaa. TOP 20. European Union Regional Development Fund
Internet sources:
Vellikok T., Biport OY LKV Procedure for the acquisition of real estate in
Finland. 2011 http://prian.ru/pub/15206.html (Accessed on 10 March 2012)
The Land Use and Building Act (MRL 132/1999). Maankäyttö- ja rakennuslaki
5.2.1999/132. Unofficial translation
http://www.finlex.fi/en/laki/kaannokset/1999/19990132 (Accessed on 1 April
2012)
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