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Claim Analysis Specialists – the morticians of project controls

Stijn Van de Vonderby Stijn Van de Vonder | In Delay Analysis, Opinion, Primaned Blog |

One of the emerging techniques within project controls is (forensic) delay analysis. It is one of the money makers of project controls. Forensic schedule analysts are among the finest and most respected experts in project controls. They study and investigate events and use Critical Path Method-based techniques to calculate the cause and impact of delays with an aim to support claims through negotiation or even legal proceedings.

At Primaned Belgium, we consider it to be a growth opportunity and we do invest a lot of time to continuously improve our skills in delay analysis. Nonetheless, we have mixed feelings about this domain.

Delay analysis

The spirit of project controls

Project controls is all about data analysis to drive effective project delivery. A successful project creates value for the owner (or the public) while leaving a nice margin for the contractor. Transparency and collaboration are two major virtues within project controls that help the construction industry to escape from its prisoner’s dilemma. Many trends in project controls (such as lean, 4D planning, integrated planning, probabilistic scheduling, etc.) are contributing to a more transparent and value-added way of delivering projects.

What about delay analysis?

In a claim context, fear of litigation drives contractors to hide information on real performance, risks and opportunities. Transparency and collaboration make way for exaggerations and greed. The project as a whole inevitably suffers from the resulting disputes. Engaging claim analysts also often inclines a butterfly effect. The counter-party will react with even more profound claim analysis and equal greed (i.e. tit for tat). Hours spend by both parties in gathering and analyzing past data absorbs a lot of negative energy that could otherwise be spent more constructively. The efficiency of project delivery drops and everyone involved in the project ends up unhappy, except maybe for the claim analysts and lawyers. Even a party that ‘wins’ a claim might be a big time loser in the long term as their market position will suffer in a market that is known for recurring contracts between parties.

What can we do about it?

Granted, if the client is (really) claim-oriented, there is little contractors can do about this and we certainly don’t want to sound naïve here. Contractors then have to participate in the claim game to guarantee their profitability.  Project administration and delay analysis techniques become very important and Primaned can surely help. Still, we believe that the focus should in this case be on preventing claims and to take actions to initiate trust. Claiming should never be a goal as such for a contractor, it can in the best case be a means.

For project owners, the story is different. They have a strategic choice to create a transparent and collaborative project environment.  We have been engaged in  international projects that were successful because of transparency and collaboration. What stroke us most from one particular project we recently worked on at contractor side is how the owner praised us to report bad performance (and the corresponding corrective actions). Contrarily, hiding true progress information was  a breach of contract. Change was dealt with in a civilized way. A good change controls process is all about ensuring that value creation persists when (inevitable) change occurs. By dealing with changes in positive, forward-looking and adaptive way, most claims can be prevented.

Conclusion

Unlike change control, claim management has little to do with value creation (read more about this in this blog post). A claim assumes failure to follow the contract by at least one contractual party and a dispute on the responsibility or impact. Given Primaned’s vision to rid the world of project failure, you cannot expect us to particularly like ‘claims of failure’ or to make huge celebrations when we help our clients to win a claim.

Providing claim analysis services is like being a mortician for us; we understand its necessity, but we would not mind discontinuing this service if that meant that there were no longer any dead projects.

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Comments (2)

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    Antonio

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    Thanks a lot Stijn for this post. Congrats for the great job. As you mention on your post claiming for failure does not add value and we as professionals should focus on preventing project failure.
    It is a sad true that happens continuously and you hear nowadays phrases like “we are going to make an offer for that amount but we will later on get our revenue from claiming “. This is sad to see but I personally think it is also important to see the cause of this mindset : in most of the tenders the price is the determining factor for a win or loss, and the low (required or desired ) standards in project controls both client and contractor sometimes aim (related for the price they want to pay)

    Regards

    Antonio

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    Dave Hammal

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    It would be good to take any lessons learned from claims as potential inputs from a project risk perspective for future projects of the same clients. That way you can at least use the process to still try and rid the world of future project failures!

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