Tips on using this forum..

(1) Explain your problem, don't simply post "This isn't working". What were you doing when you faced the problem? What have you tried to resolve - did you look for a solution using "Search" ? Has it happened just once or several times?

(2) It's also good to get feedback when a solution is found, return to the original post to explain how it was resolved so that more people can also use the results.

Baseline Schedule Submitted after Contractual Deadline?

17 replies [Last post]
Yasser Halawa
User offline. Last seen 9 weeks 5 days ago. Offline
Joined: 9 Dec 2015
Posts: 3
Groups: None

Hi all,

(I'm not sure if this is the right place to ask about this issue, if its not please let me now)

I have been assigned to a project with the contractor to create a baseline for it after the contractual deadline. When I was finished with the schedule, it has already been one month latefor submission. Therefore, the Consultant is asking me to shift all dates and reflect the actual situation. For example, Activity A on BL shouldve been completed on 1, Sep 2018, but it was completed on 15, Sep 2018 (finished before submitting the BL). So, they are asking me to put the second date as the BL date and not the first one. The only problem with their request is that one of the critical activities is delayed due to an instruction by the client. The Consultant, trying to be clever, wants me to shift the delay on the BL (since its not approved yet) and blame the contractor for breaching the contract by not submitting it on time. If I do this I will lose my right to claim for EOT later on. I know that the contractor is at fault for missing the deadline, but thats a different issue and not related to the delay by Client.

Can anyone help me get out of this problem? What contractual evidence could I use from FIDIC 1999 to solve this problem with the least amount of damages? Knowing that there is no particular conditions related to this issue.

Thanks!

Replies

Anoon Iimos
User offline. Last seen 2 hours 40 min ago. Offline
Joined: 22 Sep 2006
Posts: 1307

You know what? I believe that NO Contractor will ever take any job or contract if he/she knows (or deemed) that he/she will not make any profit from it. Unless of course if the Contractor is a philantropist and / or working for charity.

Therefore, by instinct! of course contractors will find any appropriate or legal way to make as much profits as he/she can. 

By any means, of course Schedules and realistic estimates are included (so whatever you call it - may it be a "ghost schedule" or a demonic schedule, the intention of the contractor is to always make profits as much as he/she can!). 

While on the other hand, Owners of course will find any way (without sacrificing quality) to save the budget as much as he/she can as well. Thus, making sure that he/she is not cheated by the contractor. 

So again and again (my apologies); Why make too many names for Schedules that are confusing and I believe never really used in sites for actual construction / installation (of course people on the ground have their own schedules as well which I guess much realistic or granulated but never known by the higher management)? 

Kylie Gorham
User offline. Last seen 1 week 1 day ago. Offline
Joined: 22 Oct 2017
Posts: 4
Groups: None

Yes Rafael, I agree the ghost schedule approach too.

Not only does it allow for factual ongoing project management, it also aids in risk management. If an issue does go to a claim point in the future, maintaining a ghost schedule from the time when the conflict is identified - rather than just generating a history file because "right now" you have to gather evidence for your claim - can be a significant evidentiary artefact.

Kylie

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617

Consider keeping a Ghost Schedule.  You have the right to plan and manage your own schedule no matter what, you still must deliver the contract and cannot be prevented from managing it. 

GHOST SCHEDULES – WHAT, WHY & WHAT’S THE RISK?

Page 11

CPM in Construction Management by O’Brien and Plotnick is often cited by schedule practitioners and the industry in general as being one of the leading books on construction scheduling.21 In this edition O’Brien and Plotnick discuss a situation where the owner’s representative demanded a schedule submission differing from what the contractor believed to be reality and recommend that the contractor create a Ghost Schedule.

O’Brien and Plotnick further discuss what should be done when a good as-planned schedule network did not exist or the one used was so flawed or inadequate as to be unreliable. This recommendation can be used during an active project to complete the work or when the project is in dispute.

21 O’Brien, James J., Frederick L. Plotnick, CPM in Construction Management, 7th Edition. McGraw Hill, New York, 2009.

If your submitted plan is reasonable the Client and his Consultant should not reject it, they cannot take advantage of their approval power and use any excuse to reject it.  Throwing to your face a literal interpretation of the schedule specifications as a justification for not approving the schedule can be rejected by the court.  

Ask your lawyer about placing a claim in court against the Client as well as against the consultant for interference with your right to keep the means and methods.  If the consultant is putting a big burden on you why not put some on him?

Umer Mehmood
User offline. Last seen 6 weeks 4 hours ago. Offline
Joined: 19 Jun 2008
Posts: 25

Dear 

If you have a reference for the previous data in the baseline that they want to shift , if will be useful to claim in the start and stick to it 

At that date the delay happened and you sent letter or record it . than you are entitled for the claim 

However if there is no report of the date and now you are claiming its delayed than you lose your right over it as you cant prove it

You stick to the baseline and submit and n you fight for the delay caused .

Umer Mehmood
User offline. Last seen 6 weeks 4 hours ago. Offline
Joined: 19 Jun 2008
Posts: 25

Dear 

If you have a reference for the previous data in the baseline that they want to shift , if will be useful to claim in the start and stick to it 

At that date the delay happened and you sent letter or record it . than you are entitled for the claim 

However if there is no report of the date and now you are claiming its delayed than you lose your right over it as you cant prove it

You stick to the baseline and submit and n you fight for the delay caused .

 

Yasser Halawa
User offline. Last seen 9 weeks 5 days ago. Offline
Joined: 9 Dec 2015
Posts: 3
Groups: None

Thanks all!

I have submitted 3 revisions so far without an approval. I'm insisting on getting approval for the planned dates first and any actual data to be provided AFTER the baseline approval.

Regards,

Zoltan Palffy
User offline. Last seen 21 hours 4 min ago. Offline
Joined: 13 Jul 2009
Posts: 2076

since the Consultant is asking me to shift all dates and reflect the actual situation. This is itself has already given you your answer and the answer is NO NO NO NO. The consultant used the term ACTUAL  situation. ANY ACTUALS will be made in an update. Do not fall for this trick. If you do this you have bought into any and all delays between the original contractual schedule and the updated schedule. Insist on submitting the original as planned schedule. You CAN NOT update ANY schedule until the BASELINE is  APPROVED. 

Anoon Iimos
User offline. Last seen 2 hours 40 min ago. Offline
Joined: 22 Sep 2006
Posts: 1307

You all probably know that Contract Milestones are either objective or subjective in the first place. Perhaps that's why project owners hire expert contractors and or consultants to do the job for them, otherwise, they'll do it themselves!

So what's really the meaning of a Baseline Schedule or Target Schedule or whatever you may call it? 

For me (I GUESS), the only valid Baseline Schedule (if you may call it) is the specified contractual milestones (as exactly written in the contract documents). This may or may not have specified duration or indicative dates of executions (which of course were all assumed and have no detailed basis - as every project is unique). And of course all contract documents are frozen or unstatussed in the first place until perhaps when Change is deemed necessary. 

Again (I GUESS), EVM (Earned Value Measurement - I prefer Measurement), may or may not be flawed as well (perhaps when done properly); Triangulating Scope, Time and Cost may be difficult if the intention is to arrive to a common unit, which in EMV is always Units of Currency (Perhaps this make it flawed).

While Scope and Time have its own appropriate unit of measures, they also got corresponding or equivalent unit of currency. That's why Contractors are getting paid. Otherwise, contractors (I believe) will never like to be paid with months or years or cubic meters of work (as in Barter Trade). 

So again; Why not make it Simple? 

1. Contract Schedules (Milestones) remain as is until deemed necessary for changes.

2. Give independence to contractors to make their own schedule using whatever strategy they want for as long as it is compliant with the contract documents and quality policies (Owners hired Contractors as experts anyway). 

3. Measure actual progress (Earned Value), through actual volume of works delivered, installed or constructed on site. 

 

 

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617

Only the Baseline submitted prior to any progress must be non-statused.  Baselines are to be frozen in time until a new one is required.  In construction jobs this happen very often.  Because Baselines are frozen in time they are usually late and somewhat useless.

At the beginning of project execution, the Project Schedule is the same as the Schedule Baseline. As work is done on the project, the actual progress is updated on the project schedule. At any given date, the latest version of the actual (project) schedule is referred to as the "Project Schedule".

Thereafter any further Baseline can be based on a non/partially/fully statused schedule at the option of the contractor if subject to the DOD guidelines.  That initial baseline is to be non-statused it does not means updated baselines cannot be modeled with full or some statusing.

As you never submitted a baseline on time you are in a difficult position.  It does not means you can please the whims of the owner and still make a valid claim. If you analyze the delay using a TIA most probably it will still project a delay to project completion date but you will have a shortened duration schedule for the remaining duration if compared to what could have been the initial Baseline. The EOT should provide you with some terminal float to make up for the shortened duration.

Be reminded that under FDIC terminal float is recognized and mandated.

As I said before at home we never use EVM and therefore we do not have a need to update any baseline, we just track the contractual milestones to evaluate if under/over contract target.  

Because we recognize the Schedule Review takes time we usually require contractor to submit an initial schedule at least 10 calendar days before the first project meeting for work planned for the first 60 days only.  No more than 30 calendar days after approval of the initial schedule the full schedule shall be submitted. Otherwise would be onerous and unfair.  

The following link provides a similar specification for Baseline Schedules.

MODEL SCHEDULING SPECIFICATION

Maybe the owner is being onerous and unfair, maybe it would be good to let him know in writing how you feel about his handling of the project scheduling. 

Zoltan Palffy
User offline. Last seen 21 hours 4 min ago. Offline
Joined: 13 Jul 2009
Posts: 2076

No a basline is an un progressed schedule with information known at bid date. 

Create the original basline and submit it (late of not) It doe n ot matter if the accept it or not your position if you have to go to court will be much strong to hang submitted late as opposed to not submitting it at all.  

then make the 1st updted schedule reflect the revised dates. 

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617

Is there any other simple way? 

Of course, eliminate the requirement for a Contractual Baseline Schedule and EVM and just require CPM schedule to show contract milestones. 

At home we do not use EVM except when required in Federal Government Jobs.  Because most of our Federal Government Jobs are fixed price contracts EVM is rarely/never required. But you never know, at some time you might be required to use EVM and shall be prepared to deal with it.

We are required to submit a schedule and keep track of contractual milestones.  The updates do not represent a change in contract.  Contract milestones are updated in due time, after contract changes are agreed/mandated.  Contract milestones might be lagging but in this way there is always a reminder that something is pending; it can be a contract revision or a recovery schedule, we add notes to the milestones as part of the reminder.  

Earned Value Management is flawed:

  • EVM is flawed because it does not distinguish available float, it does not distinguish between critical and non-critical activities.
  • Tracking variance at the activity level without taking into account float makes no sense.  We pay attention to critical activities and resources where EVM is of little or no help.
  • An S-curve is a result of schedule logic. On the level of activities, projects tend to have many paths, some of them critical, other not. A tiny (if compared to total project duration) schedule variance of an activity can become a cause for substantial rearrangements in the project network, it can change critical path or order of activities, enforce a total reorganization of works. This cannot be captured by either Earned Value or Earned Schedule calculations - potential problems might be masked by compensating positive and negative schedule deviations.
  • Earned Value Analysis does not distinguish between the works done on critical activities and activities with sufficient floats. A project could be late but EVA will not notice this problem if Earned Value exceeds Planned Value.
  • Earned Value Analysis motivates project managers to do expensive tasks first delaying cheaper activities that could have higher priorities.
  • Earned Value Analysis suggests forecasting future performance basing on past experience that may be wrong if resources that planned to be used in the future are not the same as in the past.
  • DOD the father of the creature is against the use of EVM in fixed price contracts. 

It is simple; no esoteric procedures to keep valid a continuously changing baseline, no EVM jargon only a few (if any) at the field understand. The schedule contract milestones give us all we need to know if under/over target.  

Anoon Iimos
User offline. Last seen 2 hours 40 min ago. Offline
Joined: 22 Sep 2006
Posts: 1307

I am very grateful to learn much from Mr. Davila. Acronyms like OTB (Over Target Baseline) or PMB (Permormance Measurement Baseline) etc... are completely new to me and I guess perhaps in other parts of the world where lots of construction projects are experiencing problems in Baseline or Target Schedules. 

Acronyms like MMA - UFC 229 maybe more popular than OTB (which I always known as "Off Track Betting").

I really like PMB - Performance Measurement Baseline (though I'm not sure if I understand it correctly).

Is there any other simple way? 

Say for example:

A Contract Schedule is a Contract Schedule (based probably from specified contractual milestones).

A schedule prepared by the contractor is a Contractor's Schedule and must be compliant with the Contract Schedule in the first place - at least in terms of dates and deliverables (but on a reasonably detailed manner considering Contractor's own strategy for doing engineering, procurement and construction works). 

Or maybe not.. as they both have the same acronym CS

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617

- Imagine Activity A (footing excavations) is schedule for six weeks but it rained on week 1, then on week 2 an unforeseen condition stop it until evaluated, at week 12 a completely redesigned foundation was issued, from spread footing to pile foundation.

  • "it rained on week 1" is a weather related event on Activity A difficult to imagine it caused a change in design, it is not implied in my example, it is just one of the multiple impacts on same activity that must be considered in further baseline re-aligment(s). To say "Rafael cited an example about change in foundation design (from spread foundation to pile foundation) caused by heavy rains" is in error.
    • Delays due to rain might cause a shift in resource demand that might change the temporal relationships necessary to resource level the schedule.
    • It would be unrealistic to evaluate the performance against a baseline that does not consider this impact. The updated baseline shall be statused to disclose this event and how it impacts the critical path and contractual milestones. It might justify an EOT but not a change in contract cost.
    • The project milestones are prone to slippage as weather events occur.
  • "then on week 2 an unforeseen condition stop it until evaluated" is a separate event impacting same activity.
    • The revised schedule and revised baseline will include many new activities, will not include some/many activities. It might justify an EOT and a change in contract cost.

Re-alignment of a baseline can be very complex.  In any case it is easier to model and understand if the revised baseline is based on a statused schedule. 

If Over Target Baseline is frequently needed in the traditional General Contractor-Owner contract, in case of Multiple-Prime_Contractors might be the only way to go.  It might (IT WILL) be impossible for all prime contractors to agree on time on every pending item to keep a valid Contractual Baseline to follow at all time.  On the other hand to ask all prime contractors to follow unrealistic baseline is a call for chaos as it happened in the Big Dig.

The following reference might also be of interest:

Anoon Iimos
User offline. Last seen 2 hours 40 min ago. Offline
Joined: 22 Sep 2006
Posts: 1307

Hi All,

Apologies if I may went out of the subject. I have a question that may be experts here can give credible answers.

Why is that "Force Majeure" due to natural disasters for example are always referred to in Contracts as "Acts of God"? Is there any Contract that says: "Acts of Evil"? I think this is more appropriate as disasters are naturally bad of course and never a godly act, unless of course if the contract writers mean God and evil are the same thing. 

Rafael cited an example about change in foundation design (from spread foundation to pile foundation) caused by heavy rains, which I believe do not normally happens in real life construction, again, unless of course if the Engineering is at fault in the first place (by not doing a thorough soil investigation beforehand). So can you say that this change is attributable to heavy rains which by any means referred to in the Contracts as "Acts of God"? Why blame God even for acts of humans?

May I cite real examples: 

Landslides (causing casualties) in quarry sites or open pit mining or tunnel mining sites. Of course landslides were triggered by heavy rains and or typhoons which again referred to in Contracts as "Acts of God", but who's doing the quarry and mining? 

Just asking (no offense meant).

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617
  • To keep a un-statused baseline when there are many/complex schedule revisions can become a monumental task.

A tiny (if compared to total project duration) schedule variance of an activity can become a cause for substantial rearrangements in the project network, it can change critical path or order of activities, enforce a total reorganization of works.

Schedule variance can be a change in plans, a change in scope, a change order, an act of god etc.  A substantial rearrangement in the project baseline might be needed.

Even a single activity might require substantial and complex rearrangement. Imagine Activity A (footing excavations) is schedule for first six weeks but it rained on week 1, then on week 2 an unforeseen condition stop it until evaluated, at week 12 a completely redesigned foundation was issued, from spread footing to pile foundation.

Changing the baseline for this single activity takes time if to be un-statused to keep all variance. It will have to be scheduled as intermittent, it will require additional activities with different resources when changed from a spread footing to a pile foundation activity(es). It  will require re-arrangement of budget amounts.

Un-statused rebaseline that keeps all variance is not as easy as a single click of the mouse.

Such a waste of time is not worth it, all is needed is an updated schedule that meets current contract conditions.

As a construction manager I have seen hundreds of times when substantial rearrangement of activities was necessary. 

Eliminate all variance is the option that makes sense on complex schedules.

Construction schedules are usually complex, even the schedule for a local hospital might require thousands of activities. To apply the same poison to all schedules is bad medicine.

I suspect DOD is aware of this and therefore leaves it open the option to eliminate all variance.  For some inexplicable reason some schedulers insist on excluding the option that makes sense on complex schedules, eliminate all variance.

Rafael Davila
User is online Online
Joined: 1 Mar 2004
Posts: 4617

Baseline Schedule Submitted after Contractual Deadline?

1.2.2.1 Over Target Baseline (OTB): An OTB is an overrun to the CBB which is formally incorporated into the PMB for management purposes.

  • Over Target Baseline (OTB) is not a claim or a change order.

3.5.6.2 Adjusting Variances: A key consideration in implementing an OTB is to determine what to do with the variances against the pre-OTB baseline. There are essentially five basic options. This is a far more detailed effort than these simple descriptions imply, as these adjustments have to be made at the detail level (control account or work package). (See Appendix B for examples.)

3.5.6.2.1 Eliminate all Variances: This eliminates cost and schedule variances for all WBS elements by setting Budgeted Cost for Work Scheduled (BCWS) and Budgeted Cost for Work Performed (BCWP) equal to the value of Actual Cost of Work Performed (ACWP). (This is known simply in EVM terminology as “setting S and P equal to A.”) This, in effect, makes the BCWS time-phased plan equal to the EAC value at complete: TAB = EAC.

This option is the easiest to apply and the easiest to understand by all parties.

When owner asked to put the second date as the BL date and not the first one he was statusing the activity and eliminating variance. 

The remaining options are difficult to understand and require an agreement among the parties, I would never agree to any of these.

3.5.6.2.2 Eliminate the Schedule Variance (SV) Only… the two PMs may agree …

3.5.6.2.3 Eliminate the Cost Variance (CV) Only … If the two PMs agree …

3.5.6.2.4 Eliminate Selected Variances… the two PMs may choose …

3.5.6.2.5 Retain All Variances … but the contractor and customer have agreed to retain all variances …

3.6 Contractual Actions: The overriding goal should be to allow the contractor to implement in a timely manner a baseline that allows proper management control of the ongoing effort. Because OTB budgets and schedules do not supersede contract values and schedules and are implemented solely for planning, controlling, and measuring performance on already authorized work, a contract modification is not needed.

If the new schedule results in an OTS situation, both parties must recognize that the existing contract milestone schedule still remains in effect for purposes of contract administration and execution. The new dates in the OTS are for performance measurement purposes only and do not represent an agreement to modify the contract terms and conditions. The customer may wish to negotiate consideration via a contract change; however, no other contract modification is necessary.

MAKE SURE ALL PARTIES UNDERSTAND IT IS AN OTB - DOCUMENT IN WRITING IT IS AN OVER TARGET BASELINE AND DO NOT SUPERSEDE CONTRACT VALUES.

I have no experience with FIDIC contracts and the reference is for some USA Government jobs. 

Anoon Iimos
User offline. Last seen 2 hours 40 min ago. Offline
Joined: 22 Sep 2006
Posts: 1307

I'm sure there was a forum topic "Contracts & Claims" before, perhaps they were getting bored of it :)

Well, I believe (from my humble experiences) that there were lots of on-going projects without an officially approved "Baseline Schedule" (Detailed) going half-way through the project or even the construction works are about to be finished. They might have a very basic milestones schedule and because all project management works boils down to decisiveness and funding, then perhaps they just let it go. This may happen if you're an EPC contractor and doing Detailed Engineering at the same time. Lack of Engineering details may hinder the preparation of a comprehensive or reasonable Baseline Schedule in the first place (which I guess good for a Planner who's trying to find a new job). 

However, if you just keep your records (I mean by paying attention to details - keeping minutes of meetings, even daily reports), then these might be a big help later on with your claims. 

After all, Planning & Scheduling is all about Records!