The recent document published by EAY Global titled “When and How can a Contractor Prepare a Claim for Variation under the 1999 FIDIC Red Book?” provides a clear understanding of the steps that need to be followed by contractors to submit variation-related claims. Those included the five steps of Aware of Entitlement to Claim, Notice to Engineer Within 28 Days, Fully Detailed Claim Within 42 Days, Engineer’s Response and Agreement or Determination of the Claim.
Each Contractor needs to comply to those dates either as specified in the contract or mutually agreed on. The same will apply to the Engineer when it comes to submitting the response and reaching an agreement or determination of the submitted claim. Therefore, it is highly recommended for contractors to implement a business process to manage the five steps of the variation-related claims. A transaction will be initiated whenever the Contractor becomes aware of his entitlement to a claim. The business process will identify all possible events or actions under each step and identify the communications and documents associated with each action or event.
The data captured in this business process will enable Contractors to have a report that consolidates the status of all variation-related claims across their complete projects’ portfolio. The report will compare the planned and actual dates for those steps and the variances between those dates. This will provide Contractors with real-time single version of the truth status report of all variation-related steps on all projects being executed by those Contractors.
Using a Project Management Information System (PMIS) like PMWeb, the business process to monitor Variation-Related Claim Steps can be created. PMWeb visual custom form builder will be used to create a template that will have three main sections. The first will be the form header to capture details of the project, record date, claim subject and workflow status. The second section will capture the planned and actual dates for the five steps of Aware of Entitlement to Claim, Notice to Engineer Within 28 Days, Fully Detailed Claim Within 42 Days, Engineer’s Response and Agreement or Determination of the Claim.
The third section will be used to capture the details of predefined possible actions or events associated with each step. For the action that is relevant to each step, the PMWeb user has three fields to complete. The first is to provide explanation of what has really occurred, the second is a confirmation that this was the action or event that took place while the third will be to confirm that relevant records and documents were attached or linked if there were records created in PMWeb.
Access to the data fields of the Variation-Related Claim Steps template can be assigned to different project team members to complete. This will be aligned with the sequence of the workflow tasks that will be assigned to this business process.
Similar to all other business processes managed in PMWeb, supportive documents that are usually associated or required for each Variation-Related Claim Steps business process transaction can be attached to the template. It is highly recommended to add details to each attached document to better explain to the reader what is being attached and viewed. In addition, links to other relevant records of other business processes managed in PMWeb can be also linked to the reported progress.
It is highly recommended that all those supportive documents, regardless of their type or source, get uploaded and stored on PMWeb document management repository. PMWeb allows creating folders and subfolders to match the physical filing structure used to store hardcopies of those documents.
To ensure that the submit, review and approve dates of each Variation-Related Claim Steps business process transaction submission are captured, a workflow will be assigned to each business process. The assigned workflow will map the submit, review and approve tasks, role or roles assigned to each task, task duration, task type and actions available for task. In addition, the workflow could be designed to include conditions to enforce the approval authority levels as defined in the Delegation of Authority (DoA) matrix.
When a Variation-Related Claim Steps business process transaction is initiated, the workflow tab available on the relevant template will capture the planned review and approve workflow tasks for each transaction as well as the actual history of those review and approval tasks. The captured workflow data will include the actual action data and time, done by who, action taken, comments made and whether team input was requested.
About the Author
Bassam Samman, PMP, PSP, EVP, GPM is a Senior Project Management Consultant with 40-year service record providing project management, project controls services and project management information system to over than 200 projects with a total value in excess of US $100 Billion. Those projects included Commercial, Residential, Education and Healthcare Buildings and Infrastructure, Entertainment, Hospitality and shopping malls, Oil and Gas Plants and Refineries, Telecommunication and Information Technology projects. He is thoroughly experienced in complete project management including project management control systems, computerized project control software, claims analysis/prevention, risk analysis/management (contingency planning), design, supervision, training and business development.
Bassam is a frequent speaker in topics relating to Project Management, Strategic Project Management and Project Management Personal Skills. Over the past 40 years he has lectured at more than 350 events and courses at different locations in the Middle East, North Africa, Europe and South America. He has written more than 550 articles on project management and project management information systems that were featured in international and regional magazines and newspapers. He is a co-founder of the Project Management Institute- Arabian Gulf Chapter (PMI-AGC) and has served on its board of directors for more than 6 years. He is a certified Project Management Professional (PMP) from the Project Management Institute (PMI), a certified Planning and Scheduling Professional (PSP) and Earned Value Professional (EVP) from the Association for the Advancement of Cost Engineering (AACE) and Green Project Management (GPM).
Bassam holds a Masters in Engineering Administration (Construction Management) with Faculty Commendation, George Washington University, Washington, D.C., USA, Bachelor in Civil Engineering – Kuwait University, Kuwait and has attended many executive management programs at Harvard Business School, Boston, USA and London Business School, London, UK.