Managed Construction

This setup usually happens in a complex project being done in phases. In this setup, the Construction Manager is the main man. He is the only one engaged with the OWNER. All other construction professionals involved in the project is under him or reports to him. He is the one making all the decisions including design issues, except for critical ones like aesthetic and structural impact which are consulted to the designing architect/engineer.

In most cases, there are several contractors in a project. There is a General Contractor, but his scope is usually limited to structural phase only. All other trades and specialty works are bid out to several contractors as the construction progresses.

ADVANTAGES:

1. The OWNER has less worries since the Construction Manager will be handling everything.

2. If managed properly, the OWNER can have big savings since every item of work will be given to the contractor with the best bid. Bids became usually low due to competition within the project.

3. There is no General Contract. If the OWNER decides to cancel the project, he has minimal obligations to settle.

4. If there is a contractor that does not perform well, the CM can easily replace him after his contract because his scope is probably just a small portion of the project at first. On the other hand, if the CM finds the contractor efficient, the CM can award him more works extending the amount of his contract.

DISADVANTAGES:

1. You only trust your CM. It would be hard for you to know if the CM is faithful to you. He may be receiving favors from some contractors in exchange to more contracts. Since he is the one evaluating the bids and contract, you are not sure if the evaluated cost is the cheapest cost you can have.

2. Warranty issues. Because there are several contractors in a project, there are often times confusion on who to claim warranty services. The CM should have managed this properly and documented everything for future references.

3. Contractors conflicts. Similar trade contractors in one projects usually finds themselves in a tight competition. Politics and work sabotage most likely happens. Also, if one contractor failed to do his part, other contractors that depends on his work will not be able to finish his works also. And if one contractor either intentionally or by accident, damaged the finished works of the other contractor, rectification works blows out to be a big issue. The blaming game now starts!

4. Conflicts on Temporary facilities. This is also related to contractors conflict. Because there are many contractors in a project, You should have an organized barracks and warehouse. It's like having a small temporary baranggay. You will need to address the issue of peace and order.

5. As the works are being done simultaneously by different contractors, the CM may need to hire additional inspectors to cope up with the speed of the progress.