Final Audit Report

PROJECT MANAGEMENT POST GRADUATE PROGRAM 511 MAJOR PROJECTS

Final Audit Report Spring Pointe Project Audit and Report

Jaspreet S. Kaur

3/20/2013

1. Executive Summary

This report has been developed to show the audit performed to Spring Pointe Condominiums

construction project and measure how effectively and efficiently project management practices

have been carried throughout its different phases. As part of the data collection process, the

approach given was developing audit questions per knowledge area, which were sent to the project

sponsor. The answers given by the sponsor were thoroughly compared to the PMBOK standard,

setting a percentage of compliance depending on the number of accurate responses. According to

the findings per knowledge area, recommendations were given to the sponsor so that he can

improve or maintain the level of commitment towards good project management practices.

Furthermore, the report generated was evaluated by the sponsor who provided his feedback on the

findings and recommendations.

Springe Pointe project was a construction project, where Condos were built in Goreway Drive,

Brampton. This project was left inactive for almost six months during the recession period that

affected both United States and Canada. In 2009, the sponsor was hired as project manager to

culminate the project. Based on the status of the project when he joined it, from the three buildings

to be constructed, he had to complete a 50 unit building as well as totally build an 80 unit building.

As per the findings and recommendations obtained from the detailed analysis accomplished from

the audit, the sponsor has brought his technical expertise to ensure that project management

practices are followed throughout the project. As a result, total compliance has been obtained for

Time, Cost, and Quality Management. Regarding Scope, Communications and Procurement

Management, most of the processes were followed; however, it has been recommended to include

some relevant project management documentation such as Requirement Traceability Matrix and

Communication Matrix as well as to perform a previous internal screening before entering into a

formal tender process. Furthermore, there were flaws presented on Integration due to the fact of

not having a formal Project Management Plan, which integrates all subsequent Knowledge Areas

within PMBOK; as a result, my suggestion to the sponsor is that is important that all knowledge are

thoroughly integrated through the elaboration of it. Human Resources Management and Risk

Management were the two areas with the lowest percentage of compliance towards good project

management practices. Concerning Risk Management, which scored 44%, identification of risks

had to be carried in order to develop mitigating and contingencies plans to asses those potential

threats for the project. For Human Resources Management, there is a need to have more connection

between the Human Resources department and the project manager in terms of setting a good

working environment within the team; incentives and bonuses are somehow a relevant way to keep

the people committed and motivated toward achieving the project goals. In general, this project

was into an 83% of compliance to the PMBOK framework, which indicates that there is a good level

of project management knowledge, but much better can be done to reach the desired 100% all

project managers expect on their projects.

2. Audit Analysis

2.1. Project Integration Management

Description

“Project Integration Management includes the processes and activities needed to identify,

define, combine, unify, and coordinate the various processes and project management activities

within the Project Management Process Groups. Project Management Integration entails

making choices about resource allocation, making trade-offs among competing objectives and

alternatives, and managing interdependencies among project management Knowledge Areas.”

(PMBOK, 2008, p. 71)

Sponsor’s Current Practice

Once the sponsor joined the project as the new project manager appointed to build the

remaining buildings, scope was already defined and presented to the new project team. There

was no project charter developed; a meeting was done where main sponsors were introduced

to the revised budget done by a cost consultant. Furthermore, changes were determined by a

consultant, and reviewed by the subcontractor regarding its impact to the triple constraint for

further approval, if needed. In case of changes, parties affected were informed during the

weekly site meetings; if immediate action was needed, it was registered into the Site Instruction

Notice (SIN) log. In terms of closing the project, the final project was revised according to its

compliance with codes, regulations and contracts established; hence, there was an

authorization by City (Occupancy permit). In addition, letters of compliance were required from

the architects, engineers, fire department, etc. to ensure that all work has successfully finished.

Findings and Recommendations

On the subject of how well project integration management had performed within this project, I

found that this project had a clear established change management procedure addressing the

triple constraint. However, there were flaws encountered in terms of not having developed a

formal project management plan, which integrates all knowledge areas. Instead of that, the

company followed its own standard procedures for this type of projects. Based on that, and also

the fact that they didn’t develop an initial project charter, it was determined that the project

compiles on a 76% according to PMBOK processes. This level of compliance doesn’t mean that

the project was not well integrated, but that they have not given emphasis on proper project

management documentation. The recommendation to give is that for future projects it is

essential to document all knowledge areas through a formal Project Management Plan that has

to constantly be revised and updated according to the project needs.

2.2 Project Scope Management

Description

Based on PMBOK (2008), Project Scope Management consists of ensuring that the required work is

performed successfully. There has to be a total control of the scope throughout the project by

clearing defining what work that is included (in scope) and which work is not part of the set of

activities to be executed (out of scope). (p. 103)


For this project, the sponsor was not involved while collecting the requirements since the project

had already started and left incomplete. However, based on his experience within the industry,

there are standard procedures to be followed by architects to determine the project, which is based

on expert judgment, market conditions and preferences at the time. In addition, they managed pre-

defined work packages where all specific work description by trade was provided. Modifications to

these packages were done by a professional consultant, who reviewed each of the specifications.

This professional consultant was also in charge of monitoring the scope of the project, and

preparing a report on a monthly basis, which was handed to the Quantity Surveyor (QS) consultant

to record it into his monthly report for bank draw authorization.


It was very surprising to find that scope creep was something expected to occur within the

construction industry since the initial condominium project is budgeted with basic finishes for the

units. Once the purchasers have chosen fixtures and colors, it can be said that the scope is

completely defined. Based on that, I would not consider it to be negative due to the fact that the

sponsor mentioned it as an opportunity of additional income. They had a well-organized change

management procedure that integrated the needs of purchases, contractors, subcontractors, all

managed thoroughly by the site supervisor on his site meetings. This knowledge area had a

compliance of 90%, where all processes were mostly followed; thus the sponsor had a complete

control on the scope throughout the project. Nevertheless, I recommend that they implement a

Requirement Traceability Matrix that would result in a better control of the deliverables, so they

avoid having any deficiency or adjustment to design. Other than that, the sponsor had a good

development of scope management for this project and should always keep this approach for future

projects as well.

2.3 Project Time Management

Description

As defined in PMBOK (2008), Project Time Management is based on how to handle the project for

its timely completion. Based on that, activities to be performed have to be identified using the Work

Breakdown Structure as its main input. After that, it’s essential to sequence the activities, as well as

develop a schedule that will provide activity durations (p. 129). With this, schedule constraints can

be identified, especially for activities on the critical path. Critical path activities are those activities

that will take the longest time duration to get the project executed.


The project consisted of four schedules, which were one for each building plus one for exterior

works and shared components. As the project had already started, the sponsor revised and made

adjustments to the schedules of the remaining buildings, updating the dates and milestone

activities. For that, analogous and parametric estimating, based on the previous completed projects,

was used as guidance. As all site activities were outsourced, the resource usage was managed

through the contractual terms & conditions. Moreover, MS Project and Excel spreadsheet were the

software used to monitor the scheduled activities. Many of the project activities were on the critical

path; as a result, when one critical activity was delayed, crashing was used to avoid schedule delays.

Main schedules were revised on a weekly basis by the site supervisor, who performed earned value

management to report the overall SPI of the project.


Through the analysis performed, no flaws were found in the way the sponsor managed time within

the project. There was a well-defined schedule with all milestones activities listed as marking

timeframes is essential for contractual obligations with external parties. Also, there was the

implementation of earned value management to track schedule performance by reporting the SPI at

different stages of the project. As a result, there is a 100% compliance with project management

practices established through PMBOK. My recommendation to the sponsor is to keep this time

management practices through all his future projects, which is critical on his profession due to the

fact that he has to deal with multiple contractors, subcontractors and purchasers simultaneously.

Time has to be clearly established so that all work is smoothly executed, avoiding the need of

crashing activities to timely finish the projects.

2.4 Project Cost Management

Description

Project Cost Management processes are set to guarantee that all work will be completed within the

estimated budget. (PMBOK, 2008, p. 165) For that, it is essential to undergo into proper estimating

techniques such as bottom-up, parametric, and technical expertise for handling accurate budget

baselines. Also, budget has to be thoroughly monitored, especially the contingency reserves

established to deal with risks encountered in a project.


The first budget, which was estimated by the previous project team working on the project, was

based on taking costs of similar projects constructed in a different Canadian province. As a result,

the project stopped due to cost overruns. As the new project team was assigned to the project,

higher management appointed a consultant that evaluated the current budget assigned to the

remaining of the project, making adjustments to have a more realistic budget baseline. With this,

the project team determined two contingencies: one for building component related changes and a

management contingency. As any other project, management contingency required higher

authorization to access and was to be used for unknowns outside the packages scope. Moreover,

budget was monitored through Timberline software, which included document control, contracts

administration and accounting. In terms of the controlling the project costs, budget reviews were

performed prior and as a condition to get the monthly bank draw authorizations.


As mentioned above, there were budget flaws before the sponsor took over the project. Once he

started working on it, he brought all his cost management expertise to ensure that they do start

with a revised and up to date budget baseline. For that, expert judgment through the cost

consultant was implemented; along with the consultant, the team determined the two

contingencies that left no room for mismanagement. Budget lines were flexible in order to

compensate for overruns in other work packages. For example, they had a budget line for snow

removal, but as winter came warmer than expected, some of the amount was used in other

activities such as asphalt carpet repairs. Through my analysis, I determine that there was 100%

compliance to PMBOK Cost Management knowledge area processes. I strongly recommend my

sponsor to keep applying his project management knowledge so that he can efficiently complete all

his future projects within budget, which is one of the most critical factors for project success.

2.5 Project Quality Management

Description

Project Quality Management consist all the activities performed within an organization to establish

a proper quality planning in terms of policies, objectives and project purpose to obtain total

customer satisfaction on the final deliverables. (PMBOK, 2008, p.189) Continuous improvement

procedures are the key to obtain high quality deliverables since there is thoroughly monitoring

process to prevent any defect and deficiencies, and if they come, corrective actions are set on place

immediately.


Construction projects have to comply with codes, regulations and industry standards, thus the

project undertaken by Mr. Rodriguez was no exception. Quality planning was conducted based on

those codes, regulations and industry standards; to ensure that quality was met throughout the

project, professional consultants underwent all required evaluations plus City officials performed

own inspections to determine compliance with the building permits and by-laws. Furthermore,

quality metrics were written down for most of the deliverables on the basis of compliance with

industry codes and regulations. As far as controlling quality was concerned, the site manager used

quality checklists to verify that all work done by the contractor, on a daily basis, complied with the

specs stipulated in the contracts.


In terms of Quality Management, I believe the sponsor has totally followed PMBOK guidelines to

ensure that the project delivers quality end housing units for the purchasers. Thus, the results show

100% compliance to project management practices for this knowledge area. It was found that the

whole company was strictly regulated by Tarion, a private corporate that protects the rights of new

home buyers and regulates new home builders. For that, a Tarion specialist was designated to

ensure that all Tarion evaluation criteria were met for the project. As mentioned by the sponsor, he

encountered the case where a contract specified to work with materials that no longer existed by

the time the project has to be executed. As a result, new deliverables were considered, which also

had to comply with the quality standards previously set. I would encourage my sponsor to further

continue rendering quality management procedures and keep working with continuous

improvement for each of the processes; especially in cases where changes are required.

2.6 Project Human Resource Management

Description

“Project Human Resource Management includes the processes that organize, manage, and lead the

project team. The project team is compromised of the people with assigned roles and

responsibilities for completing the project. While the specific roles and responsibilities for the

project team members are assigned, the involvement of all team members in project planning and

decision making can be beneficial. Early involvement and participation of team members adds their

expertise during the planning process and strengthens their commitment to the project.” (PMBOK,

2008, p. 215)


Human Resources Management was not directly handled by the sponsor since the main offices

were located on Calgary, which implemented their standard polices. In terms of the hiring process

for the project, the site supervisor and site secretary were inherited from the previous team, while

the Tarion specialist and law clerk were hired by VP Bus Development. As concerned to the

sponsor, he was interviewed and hired by California based VP who was taking over Ontario as well.

Based on the fact that most of the team was located in Toronto and Brampton (site work), Calgary

head office had their standard procedures for documenting the roles and responsibilities, in terms

of who will be accountable, responsible, informed and consulted for each work package.


From what was obtained from the audit analysis, there are several gaps in terms of how Human

Resources Management was implemented on the project. First of all, the project manager (the

sponsor) had little intervention on Management dealing with their resources. Based on that fact, no

formal Human Resources Plan was set on place for execution. The company used their standard

procedures for acquiring the project team to finish the project, but they didn’t consider important

factors to motivate the committed team such as rewards for their performance and incentives.

Basically the team was there to complete a six month inactive project, thus Management should

have considered better ways to encourage excellence, good working relationships among them.

The sponsor considered that working on small teams made it easier to communicate; hence

everyone was committed to complete the project. Taking into account those flaws within

integrating this knowledge area through the project, the percentage of compliance is 60%, leaving

room for a lot of improvement. Based on my personal experience from the workplace, usually there

is less time taken to have a well-documented Human Resources Plan, and if there is one, it is often

filed and not executed as it has to be done. My recommendation to the sponsor would be actively

getting involved with the Human Resource department when working in projects, so that all

information regarding the project team is well addressed. Rewards and incentives play an

important role to get the team connected to a particular project and dedicate all efforts for its

success.

2.7 Project Communications Management

Description

“Project Communication Management includes the processes required to ensure timely and

appropriate generation, collection, storage, retrieval, and ultimate disposition of project

information. Project managers spend the majority of their time communicating with team members

and other project stakeholders, whether they are internal (at all organizational levels) or external

to the organization.” (PMBOK, 2008, p. 243)


When Mr. Rodriguez took over the project, stakeholders were identified by the project team

previously working on the project; however, as time progressed and stakeholders changed,

adjustments were made to attend their needs and concerns. Considering the fact that all

construction activities were outsourced, the sponsor managed communications with them based on

what was established within the contractual terms and conditions. As the company main offices

were located in Calgary, and their project was executed in Brampton, they carried effective

communications through emails, fax, telephone and instructions via the project administration

software. Moreover, the project was thoroughly monitored by a site supervisor who managed to

report performance in terms of cost, schedule and compliance with legal requirements, among

others. In terms of documenting issues that came within the project, the sponsor didn’t work with

an issue log; the key to follow up on the project was performed through a Site Instruction Notice

(SIN) log, which was tracked by the sponsor and site supervisor.


Based on the information obtained, project communication management was 88% compliant to the

PMBOK standard. Most of the communication processes were followed though there was not a

formal communication matrix or communication plan implemented. I would recommend that

regardless the standard company procedures implemented to address communication needs, it is

important to establish a formal communication plan to specifically highlight each type of

stakeholder and what are their needs and expectations from the project. As a project manager

handling several projects at one time, it is essential to keep a well-documented registry to address

all stakeholders across the projects. Also, it would be useful for their company to implement an

issue log to effectively address each issue encountered in terms of managing stakeholder’s

expectations. Overall, good communications was established with internal and external

stakeholders, especially with subcontractors and consultants, whom were required to attend

weekly site meetings to report performance.

2.8 Project Risk Management

Description

“Project Risk Management includes the processes of conducting risk management planning,

identification, analysis, response planning, and monitoring and control on a project. The objectives

of Project Risk Management are to increase the probability and impact of positive events, and

decrease the probability and impact of negative events in the project.” (PMBOK, 2008, p. 273)


For the project, the sponsor was bounded to work within the company polices, which didn’t give

relevance on having a proper Risk Management Plan. This is the reason why the first phase of the

project entered into serious cost overruns due to the fact of not undergoing into risk planning.

Before the project restarted, two contingencies were established to deal with the threats that may

come through the execution. Furthermore, time buffers were proposed but in some cases there not

all well accepted by higher management leaving some units to be finished with the minimal

requirements.


As far as Risk Management was concerned, no proper approach was given to it. Starting with the

fact that no risk plan was developed from the previous project team, which is the result of lack of

interest from the company on establishing a formal Risk Management Plan. Although there were

two contingencies reserves allocated to the project, risks were not identified as per their

probability and impact for the project. Due to the fact that risks were not identified, they were not

able to develop a contingency plan. Risk appeared from everywhere and some related to previous

stakeholder management, which resulted in a huge risk of shutting down the project for the second

time. For instance, previous complaints from buyers regarding noise transmission resulted on the

City building department conducting an audit and inspection to all projects within the company,

including the project handled by the sponsor. After my analysis, I established that this knowledge

area was 44% compliant to the PMBOK standard. I would say this deficiency had lot to do with

higher management approach towards implementing Risk management within the company. The

sponsor did tried his best to create awareness on identifying potential risks so it could be formally

documented and saved on the organizational process assets. Company lack of interest clearly shows

that they didn’t focus on post project evaluation and lessons learned of completed projects. What I

would recommend the sponsor is to create awareness of risk management within his industry so

that companies start to focus on this area of Project Management. Companies have to be clear that

top class quality, good contractors, high expertise and latest technology doesn’t mean that a project

is risk free or no events might occur on the project. Identifying risks, risk triggers and contingencies

plans will result on allocating more realistic contingencies reserves for the project, without having

the need to use the company management reserves to cover those threats.

2.9 Project Procurement Management

Description

“Project Procurement Management includes the processes necessary to purchase or acquire

products, services, or results from outside the project team. The organization can be either the

buyer or seller of the products, services, or results of a project. Project Procurement Management

includes the contract management and change control processes required to develop and

administer contracts or purchase orders issued by authorized project team members. “(PMBOK,

2008, p. 313)


As all work to be performed to build the condominiums and equipped them were auto sourced, the

sponsor closely managed this knowledge area. It was ensured that all the scope of work required

was specified within the contractual terms & conditions. There were cases in which more flexibility

was allowed, leaving path to compliances and specs to subcontractor; this was seen in the case of

mechanical and electrical work. Moreover, the evaluation process carried out for contracts was in

terms of specifications, price and risk represented. Giving the nature of the project, were the

purchasers decided on the final finishing they would give to their units, it was critical for the have a

well administered contract process, maintaining all change orders and purchase orders current and

software system up to date. In terms of closing the contracts, normally they had a list of

deficiencies resolved, and substantial completion signed by professional consultant was done.


As per the findings for this knowledge area, the sponsor mostly went through all processes to be

followed, based on PMBOK; as a result, 92% compliance was obtained. Their team believed in

continuous improvement and that is why they decided to change their contract format after a

review and recommendation presented by lawyers. However, I consider it somehow risky to give

mechanical and electrical work flexibility on determining the compliances and specs; this may

result in some sort of advantage for the subcontractor, who would want to charge high for the work

performed. For that, the project manager may have electrical and mechanical consultants, along

with the civil engineers to thoroughly revise all items listed within their contract clauses. In

addition, I would suggest the sponsor that for future projects, he along with his team of experts

should undergo a prior tender screening in order to avoid having contractors that may offer to do

the work at affordable prices, but with lack the technical expertise; hence the subcontractor fails to

comply and deliver quality products.

3. Sponsor Reaction

Appendices

Appendix A

Sponsor Agreement

PROJECT CHARTER 1/27/2013

Project Purpose

As future project managers, it’s important to see the application of all knowledge areas

presented through PMBOK in diverse projects within the industry. Thus, project audits are

the best instruments to evaluate how a project was managed, delivered and ways to

improve delivery for future projects.

In this project, I will be working on the audit of a completed Construction project, whose

project manager was Mr. Ivan Rodriguez. A complete review will be done to his project so

that I can further compare it to the PMBOK standard, and provide assessment based on the

findings. If there was room for improvement, I will give my recommendations according to

the PMBOK guidelines.

Project Objectives

Identify sponsor’s project within the company he is working for or was working for

previously.

Throughout discuss the project with the sponsor to get all details of what was done.

This discussion will be held by preparing auditing questions per knowledge area of

the PMBOK.

Based on the sponsor’s information about the project, the project will be compared

with the PMBOK processes and sub-processes.

Prepare complete project report with all findings. This will be provided to the

sponsor for its revision and feedback.

Sponsor’s Project

Brief Description

Spring Pointe project consisted on the construction of Condos located in Goreway

Drive, Brampton. There were three buildings to be constructed: one building of 100

units, the second one with 50 units and the third one with 80 units. Due to the

recession period in both United Stated and Canada, the project was stopped for

further completion. Mr. Rodriguez joined Pointe of View Company (presently named

Carlisle Group) in 2009, and this project was assigned to him. The project had been

inactive for six months and was 35% complete. Mr. Rodriguez had to complete the

second building and totally build the third one.

Start Date: September 2009

End Date: December 2010

Sponsor Contact Information

Complete Name: Ivan Rodriguez

Position: Project Controls

Company: HKSC Developments LP

E-mail: [email protected]

Phone: (647) 923-1798

Sponsor Sign off

mailto:[email protected]

Audit Questions and Responses

Appendix B

AUDIT QUESTIONS FOR SPRING POINTE PROJECT

Initiating Phase

Knowledge Areas:

Communications Integration

Planning Phase

Knowledge Areas:

Scope Time Cost Quality Procurement Communications Risk HR Integration

Executing Phase

Knowledge Areas:

Quality Procurement Communications HR Integration

Monitoring & Controlling Phase

Knowledge Areas:

Scope Time Cost Quality Procurement Communications Risk Integration

Closing Phase

Knowledge Areas:

Procurement Integration

QUESTIONS PER KNOWLEDEGE AREA:

MINIMUM 4 TO 5 QUESTIONS

WEIGHTAGE:

5 POINTS/QUESTION

COMMUNICATIONS MANAGEMENT

TOTAL: 25 POINTS

Initiating

1. Were all stakeholders identified? How was the stakeholder analysis performed? (5 points)

Stakeholders were identified and concerns addressed at the beginning of the project; however, as the project evolved, stakeholders changed and adjustments were made to accommodate new concerns and requirements. 5/5

Planning

2. Was a Communication Requirement Matrix done? Which information was included in it? (5 points)

There wasn't a communication matrix or communication plan prepared per se for the project. Standard company procedures for remote office were implemented; this included a daily morning conference call with all remote teams involved in the project. Day to day operation was managed mostly by email, including communication with City officials and other authorities.

Formal communication procedures with trades and other parties such as purchasers, was normally contained within clauses of contracts. Consultants and subcontractors were required to attend weekly site meetings, where schedule constraints and scope creep was discussed. Extraordinary site meetings per area of expertise were held as required. All meetings were written in a minute and communicated by email. 4/5

Executing

3. How did you document and monitor issues that came within the project? Was an issue log implemented? (5 points)

There was no issue log implemented; nevertheless, requests for Information (RFI) were used. The key to maintain proper follow up of all items was the development and maintenance of a Site Instruction Notice (SIN) log.

Because of the nature of the project, there were series of codes and regulations such as OBC, Construction Lien Act, Tarion, etc., which needed to be followed. Many procedures to comply with these regulations are embedded within standard industry contracts. For instance, a scope change, regardless of where is initiated, needs to be approved by a professional consultant through a Site Instruction (SI). A SI in general generates a revised estimate from a subcontractor which in turn, generates a Change Order (CO) from the developer/general contractor authorizing the new change.

For example, following the procedure described above, a scope change would be initialized with a RFI sent to a Consultant, if the response from the consultant (SI) was a change in scope which didn't affect cost or schedule, then was followed by a SIN to a subcontractor. On the other hand, if the SI was affecting cost or schedule, then a new RFI was issued to a subcontractor who in turn would respond with a revised scheduled and estimate. The formal authorization of the change was issued

with a SIN accompanied with the CO or a Purchase Order (PO) depending on the magnitude and nature of the change. 3/5

4. How was information distributed among stakeholders (e-mails, meetings, project website)? (5 points)

Communication with internal stakeholders, including Calgary office was through emails, fax, telephone conversation and instructions via the project administration software. As explained before, external stakeholders normally received communication via email; however, subcontractors and consultants were required to attend weekly site meetings. 5/5

Monitoring & Controlling

5. How often were performance reports distributed among stakeholders? (5 points)

Performance reports were distributed monthly, weekly and daily, depending on the stakeholder.

It is common practice for capital construction projects to be monitored by a consultant (Quantity Surveyor) designated by the financing institution. The consultant (QS) issues normally a monthly report for the approval of the bank draw, making it a key component for the continuation of the project. The report comprises project performance analysis with respect to cost, schedule and compliance with legal requirements among others.

One of the functions of the weekly site meeting was to monitor and report progress. Critical path items were closely monitored, sometimes on daily basis with progress reported and discussed with parties affected. 5/5

INTEGRATION MANAGEMENT

TOTAL: 25 POINTS

Initiating

1. Was a project charter developed for the project? As the project was already started and you had to complete the construction of the remaining condominiums, did you develop a second project charter to validate or refine the decisions made by the previous project team? (5 points)

No, the scope of the project was well defined in general from day one, main sponsors remained the same, and a recent review of the budget was already completed by a cost consultant and authorized by a financial institution. 3/5

Planning

2. What was the approach given to the development of the Project Management Plan? (5 points)

A specific project management plan wasn't prepared, company procedures standard for all the remote projects were used instead and complemented with standard industry practices. 3/5

Executing

3. Was the project thoroughly executed as per the Project Management Plan? In case of changes, how were they registered within the Project Management Plan? (5 points)

As mentioned above, the project approach was done based on the standard procedures followed by the construction industry. 3/5


4. Based on the changes encountered during the project, how did you manage these changes requests in terms of approving / rejecting them and looking for their impact within the project? (5 points)

There was a procedure in place for change management. Scope of change was determined by consultant, reviewed by subcontractor in terms of schedule and cost, and submitted for approval.

During the approval process, the change cost was normally added to the existing subcontract price and flagged for reconciliation and reporting of contingencies at the end of the month. The schedule was revised to adjust to the change and parties affected informed during the weekly site meeting or through SIN if immediate action was needed. 5/5

Closing

5. Which procedure was followed in order to successful close the project? Was there a final sign-off by the sponsor accepting the final deliverables? (5 points)

There are many deliverables in a condo project and close out needs to comply with codes, regulations and all contracts established. In this case, was decided to close weekly and bi-weekly by floor levels.

In general terms, to close a unit, authorization by City is needed (Occupancy permit), building inspector requires letters of compliance from professional consultants and others (architect, engineers, fire department, etc.). At the same time, Tarion requires a Pre-delivery inspection to be performed by the buyer prior to closing, which includes elaborating a list of deficiencies and works outstanding, time frames for completing works is also regulated.

There are similar procedures to hand over common areas of the building to condominium Board. 5/5

SCOPE MANAGEMENT

TOTAL: 20 POINTS

Planning

1. Which tools & techniques were used to collect the requirements for this project? (5 points)

I wasn't involved at the beginning; however, there are standard procedures within the architectural practice to determine the program, which normally is based on market conditions and preferences at the time. 5/5

2. How did you create the Work Breakdown Structure for the project? (5 points)

Standard industry packages determine project activities and vice versa. Packages have specific work descriptions by trade, sometimes are modified according to project conditions and team experience, normally provided by a professional consultant or complemented with professional consultant specifications. 5/5


3. How was the scope of the project verified during execution? Did you use a Requirement Traceability Matrix? (5 points)

Scope was monitored by professional consultants (architect, engineers, etc.), reports were prepared on monthly basis; these reports were required by the QS consultant and included in his monthly report for the bank draw authorization. 4/5

4. How did you manage to control the scope of the project to avoid any scope creep? (5 points)

Scope increase is expected in certain items; for instance, typically, a unit is budgeted with basic finishes, and is not until purchasers have chosen fixtures and colors that scope is completely defined.

For this kind of projects, the above changes in finishing, if managed properly, would result in an

opportunity because of the additional income that generates. When the change comes from a

deficiency or adjustment to design through SI, there’s practically nothing to do and a contingency

must be used. 4/5

TIME MANAGEMENT

TOTAL: 25 POINTS

Planning

1. How did you determine the Milestone List when defining the activities for the project? (5 points)

The project was divided in 4 main schedules, one for each building (3) and one more for exterior works and main shared components. Each building schedule was subdivided by structural, common utilities and risers, long lead items, common areas and half floor levels. Individual schedules for

some finishing packages and units were developed when ‘crashing’ was needed to ensure times were maintained. Each of all schedules had its own milestones, for instance, one important milestone was roof completion, because interior works would commence right after and would mark timeframes for contractual obligations with external parties. 5/5

2. When determining the duration of the activities, did you use any particular technique such as three-point estimates? (5 points)

Analogous estimating and Parametric based on previous performance at the beginning of the project. 5/5

3. How was the activity resources estimated, especially for those activities to be outsourced? (5 points)

All activities were outsourced, and that was managed to the contracts. 5/5

4. Which software did you use for developing the schedule for the project? Were key events, milestones, progress evaluations, critical and near-critical activities identified in the schedule? (5 points)

MS Project and Excel spreadsheets were used. Many activities were on the critical path depending on the schedule and some became more critical than others. For instance, a delay on mechanical ductwork in two buildings held drywall boarding and this in turn delayed all the finishing in units, forcing to crash schedules. 5/5


5. How often was the schedule revised? Was earned value management done to record the schedule performance index (SPI) at different stages of the project? (5 points)

Main schedules were revised prior to weekly site meeting, however was monitored daily. QS Consultant had SPI for overall project in his report. 5/5

COST MANAGEMENT

TOTAL: 25 POINTS

Planning

1. Which technique was used to estimate the costs of the project? (Ex: Top-down, bottom-up, analogous, parametric, etc.) (5 points) *

The first budget was created analogous but underestimated, based on costs from very similar projects but in different Province. This caused in big part the stop of the project due to overruns. After that, a cost consultant was appointed, who made all adjustments to start working with a realistic baseline budget. 5/5

2. Had the project cost estimation involved significant cost related risk? If so, how were these managed? (5 points)

Once the new budget was revised, we determined 2 contingencies, one for building component related changes and a management contingency, which was used for unknowns outside of the packages scope. Only the first contingency was present in the day-to-day project administration software, while the management contingency required higher authorizations to access. 5/5

3. When determining the budget for the project, was it consistent with the project requirements, risks and contingencies? How did you document that, any particular software used? (5 points)

The second budget was very lean and accurate, including the allocation of contingencies, which left no room for mismanagement.

The project was administered with a single software (Timberline) encompassing document control, contracts administration and accounting, which streamlined communication with remote parties involved. For instance, a change order issued from Toronto office was immediately available for accounts payable in Calgary office, and ready for execution at site in Brampton (we managed simultaneously another condo project in Welland and site had access to the same software; actually, I was able to see in my screen a general status of all projects in North America). 5/5


4. Which tools and techniques were used to control the costs of the project? (5 points)

All packages were tendered ensuring market prices prevailed among awarded contracts. Establishing a process to issue PO and CO after subcontractor estimation was provided, was key to maintain control over contracts and monitor budget simultaneously.

The difference between a PO, a contract and a CO, was that a Purchase Order was normally issued to material only suppliers, Contracts were signed normally for packages where labor and material were involved. Change Orders were for additional scope or credits to contracts, that is to say, if standard contract for kitchen included laminate countertop and during color selection a purchaser choose granite instead, a CO for the credit of the laminate was issued to the kitchen company and a PO to the granite supplier. 5/5

5. In case of budget variances, how were they managed? (5 points)

There was a review of the budget prior to and as condition to monthly bank draw authorizations. Budget lines had amounts reallocated to compensate for overruns and overblown lines. In other words, if winter was warmer than expected, some amount from snow removal budget line would be transferred to road paving line to compensate for asphalt carpet repairs, to say something. 5/5

QUALITY MANAGEMENT

TOTAL: 25 POINTS

Planning

1. How was the quality planning done for the project? (5 points)

Quality had to comply with codes, regulations and industry standards. Monthly inspections and reports from various professional consultants (Architect, Engineer, etc.), would attest compliance with codes and most regulations, additionally City officials would perform own inspections to determine compliance with building permits and by-laws. Contract packages included scope of work with plans and specifications for trades, any deviation from these specs was evaluated accordingly and dealt in many cases through SI and CO processes.

For the case of Tarion, in addition to codes, industry standards are applied, especially for assessment of finishing deficiencies. Tarion requires a separate set of reports, some prepared by professional consultants within established time frames. 5/5

2. Did the project have well defined Quality metrics for the deliverables? (5 points)

Most of the deliverables yes, through compliance with codes. 5/5

Executing

3. Were Quality Audits done during the project? What was evaluated during them? (5 points)

All inspections and reports mentioned in question 1 were to assess scope (compliance to building permit) and quality (compliance to codes and regulations) 5/5


4. Did do you have an exclusive personnel in charge of controlling the quality of the deliverables for the project? Which techniques were used to monitor quality? (5 points)

Site Manager was responsible to review that all works were in compliance with specs stipulated in contracts. Checklists were developed to follow up authorized changes, including non-standard items resultant of color selections. For instance, if a bathtub was substituted by a shower enclosure, a list of all units with shower enclosures would be developed and used in walk through with mechanical subcontractor. 5/5

5. Based on the quality standards established, were any significant changes required to be done during the project executing phase? If so, did it affect the scope, time or cost of the project? (5 points)

There were some changes from original specifications contained in purchaser’s contracts that couldn’t be fulfilled, amendments and compensations had to be negotiated. For instance, laundry closets in some units were designed in size for specific appliance model which was no longer available at the time of construction, forcing to replace with smaller and more expensive units. 5/5

PROCUREMENT MANAGEMENT

TOTAL: 25 POINTS

Planning

1. Which is the evaluation done to all purchasing documents to ensure that all requirements are completely specified? 5 points)

As mentioned previously, packages included scopes of work specific for each trade. This scope along with plans and specs were part of the contract. There were more ‘flexible’ contracts were only schematic designs were provided and general requirements established, leaving path to compliances and specs to subcontractor criteria, as was the case of mechanical and electrical works (M&E).

Standard industry contracts were used, although for earlier works the standard contract was CCDC2, after a review and recommendation of the lawyers, was switched to CCA17. 4/5

2. Had project related sub-contractors been evaluated in terms of how could they impact the project?

E.g. technical experience, delivery times, quality system and financial stability. Explain. (5 points)

Not all trades were screened prior to tendering, however if they had a competitive bid, then a deeper screening would take place.

There were cases where subcontractors failed to comply and back charges were applied to complete their work. 4/5

Executing

3. How were subcontractors tenders evaluated? (5 points)

Tenders were evaluated in terms of specifications, price and overall risk represented. 5/5


4. How often were the contracts verified to ensure the performance of each subcontractor met the contract requirements? (5 points)

As explained before, there were site inspections by many parties to determine compliance to contract.

However, in the contract administration side, maintaining all COs and POs current and the software system up to date, helped to control contracts. There were contracts with 40 o 50 authorized changes or subcontractors with dozens of POs, which made it more difficult to evaluate monthly progress and billing authorizations. 5/5

Closing

5. Was there any Procurement audit performed prior the closing the contracts? What was the procedure followed? (5 points)

Depending on the contract, normally having list of deficiencies resolved and substantial completion signed by professional consultant suffices. Holdbacks are explained later in risk. 5/5

RISK MANAGEMENT

TOTAL: 25 POINTS

Planning

1. Were risks of the previous project team considered as a baseline for planning the risks of the project? How were they useful? (5 points)

No, when project was restarted there was a different set of risks to deal with, which resulted in the 2 cost contingencies mentioned before; no risk plan was passed on from previous team. 5/5

2. How were the risks identified? Was a probability/impact matrix used? (5 points)

Risks were not identified for the project. 0/5

3. What techniques were being used in the project to prioritize, manage and record the identified risks and their resolutions? (5 points)

Didn't have risk register, contingencies were given prior to restarting the project. 1/5

4. What was considered to mitigate the risks identified? Was a contingency plan established? (5 points)

As explained before, 2 cost contingencies were created to complete the project, one operational and a management contingency. Time buffers were proposed and implemented as well; however, not all were accepted by higher management causing some units to be legally closed with the minimal requirements and long lists of outstanding and unresolved deficiencies. 3/5


5. Were there any major risks encountered in the project? How was the contingency plan implemented? (5 points)

There wasn't a contingency plan. Risks appeared from everywhere and many related to previous bad stakeholder management, which could have caused shutting down the project for second time. For instance, unattended complaints from buyers regarding noise transmission escalated to City building department, causing an audit of building permits and inspections from previous years and team working to have everything in order. 2/5

HR MANAGEMENT

TOTAL: 25 POINTS

Planning

1. Had education, knowledge and experience been accounted for in the allocation of project staff for the project? What was the evaluations criteria regarding the staff performance? (5 points)

To certain point. Project didn't have special people designated. Standard HR policies from Calgary head office were used instead. 3/5

2. How were the accountability, authority, responsibility and job descriptions defined and documented? (5 points)

Calgary head office standard for remote projects was used. 3/5 Executing

3. How was the project team formed? Had you (project manager) been involved in the appointment of key team members for the project? (5 points)

No, site super and site secretary were inherited from previous team; Tarion specialist and law clerk were hired by VP Bus Development. 3/5

4. How was the project team recognized and rewarded for their performance through the project? (5 points)

No rewards were given in terms of performance. 2/5

5. How was the project environment? Did it encourage excellence, good working relationships, trust, respect and open communication? (5 points)

Team was very small, which made it easier to communicate, we all were on board and committed to complete the project. 4/5

EVALUATION CHART

Knowledge Area Total Points Points Obtained

Percentage of Compliance

Communications Management 25 22 88% Integration Management 25 19 76% Scope Management 20 18 90% Time Management 25 25 100% Cost Management 25 25 100% Quality Management 25 25 100% Procurement Management 25 23 92% Risk Management 25 11 44% Human Resources Management 25 19 60% AVERAGE OF ALL KNOWLEDGE AREAS

83%

Status Percentage Description

Less than 45% PMBOK is mostly not followed

From 45% to 75% PMBOK is followed regularly

Greater than 75% PMBOK is mostly followed

References

PMI (2008) A Guide to the Project Management Body of Knowledge. 4th Edition. Pennsylvania, PA:

Project Management Institute, Inc.

Final Audit Report

Documents

Transcript of Final Audit Report