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Project Management Terms: Below Is Our Master List Of Common P.M. Terms, Their Definitions & The Terms Used In Context. This Will Be A Rolling List That Will Be Updated Regularly!
Definition: Sequencing and consolidating the present project schedule to reach a certain date, or milestone, in less time. This is done by adding resources, overlapping activities or working more hours per day.
In Context: “We’re two weeks behind on this project. We need to come up with an accelerated schedule to make the deadline”
Definition: In Accounting: An accrual is a placeholder cost on the company ledger. It allows a cost to be ‘forced’ into a certain accounting period, before a bill have come, or the actual cost hits the books. When the actual cost hits the books, the accrual placeholder is removed.
In Context: “We billed the client for the cost of these widgets, but we haven’t gotten billed by the vendor we bought them from. Our books close at the end of the day. Let’s accrue the cost of the widgets this month so the cost is on the books in the same month as when we billed the client.”
Definition: Parties that are covered on a specific insurance policy beyondin addition to the primary “Insured Party”
In Context: A Contractor provided their Client with insurance coverage, so the client is insured if any accidents happen or lawsuits occur. The Client’s Representative and Design Architect are also covered on the policy, and they’re listed as Additionally Insured parties in the Policy
Definition: This person handles tasks associated with running the project or business, mostly regularly occuring. This typically includes processing payroll, receiving bills, sending out checks to pay bills, accounting files, etc.
In Context: “Our Admistrator in the office knows which new hire forms you need to fill out, give them a call.”
Definition: A list of topics to discuss, questions to answer and items to resolve in a meeting, which is sent out beforehand so the attendees can prepare.
In Context: “The Client wants to know the cost of doing ______, put that on the agenda for tomorrow’s meeting so we all can brainstorm”
Definition: No, not two people reaching common ground, but sort of. This refers to any form of written terms and conditions two or more parties have agreed to prior to doing business together. This is a broad term that usually includes a contract, subcontract, purchase order, etc.
In Context: “The Agreement we signed with you states that we’ll get paid within 30 days of approval (net 30). It’s been 60!”
Definition: These are drawings meant to illustrate an overall intent or concept of a project. This includes the appearance of the finished product, key features and general requirements. These are often drawn as a preliminary version of what the Client wants, and are used for filing general permits, for contractors to price work, etc.
In Context: “At this stage the Client has hired an Architect. They’ve met to discuss what the Client wants the end product to look like (building, bridge, etc), and they’re now drafting Architectural drawings for the Client to review. The complete drawings will then be given to 3-4 contractors so they can bid on the construction and a contract can be signed to start.”
Definition: These are drawings showing the details of final construction, as-built in the field. These drawing sexist for records, so anyone in the future can look at the drawings and find details that match what they see in the actual construction.
In Context: “The drawings you submitted showed this ceiling electric conduit being 3-inches closer to the adjacent wall than where it was installed. Make sure that change is shown on the as-built drawings you submit once you’re done installing onsite.”
Definition: Anything that is expected to provide benefit in the future. This can be something owned, or created. A large business, a piece of a quipment or a software that generate revenue are all considered assets.
In Context: “Luckily we have several contractors paying us to use our laser jet machine to fabricate steel. That thing is an asset.”
Definition: Pure hell! Ha. This is someone who is in training to become a project manager. Usually working directly for a project manager, the assistant handles miscellanous administrative and day-to-day tasks to learn the business, as directed by the PM.
In Context: “Work on this project for the next two years as an assistant PM, and you’ll learn all the skills required to be the PM on the next project”
Definition: A thorough review of company documents to confirm compliance with various rules and regulations. Usually referring to accounting, but applies to any documents or records. Performed by a third party.
In Context: The company’s accounting ledger for the last 12 months will be audited, including the account-payable and account-receivable records, to make sure the proper amount of state tax was paid.
Definition: The issuer of a contract or purchase order makes a claim to not pay the other party for a portion or all of their price, because there was a violation of terms/conditions and the issuer took on unnecessary costs.
In Context: Sarah’s Treehouse Company bought some specialty wood windows from Kevin’s Treehouse Windows. Sarah issued Kevin a purchase order to buy windows that are 24-inch wide but he made/delivered them 26-inch wide. Sarah had to cut the openings an extra 1-inch wide on either side. It cost Sarah $1,000 to do this. She therefore is going to backcharge Kevin’s company $1,000. She will do so by deducting this from how much she agreed to pay him in the P.O.
Definition: A baseline, in essence, is the original project plan. This broken into time (schedule), cost (budget) and description (scope of work). This is the measurement and reference everybody refers to as the project progresses.
In Context: A Software Development Project Baseline: This software shall look a certain way, and be able to perform functions a,b & c once completed. This will take eight months to develop using a team of five software engineers. This software will cost a total of $400,000 to create, including design, testing and other misc. costs.
Definition: A standard list of broad or general terms that typically does not change across a variety of documents.
In Context: “We have boilerplate terms and conditions included in every contract we issue to consultants.”
Definition: Any violation of the terms or conditions included in a contract between two or more parties.
In Context: “You said you’d dedicate three engineers to this design project in order to finish by September 30th, but for the last month you’ve only provided one engineer. You’re in breach of our contract!”
Definition: The total of all costs expected to perform and complete a project or service.
In Context: “How much money do we have in the budget to hire a consultant?”
Definition: The itemized summary of formulas, figures and assumptions an engineer has made to support their final design. Calculations are stamped by a Professional Engineer, who is qualified to approve them.
In Context: “Which type and size of weld does the engineer’s calculations require for this structural steel?”
Definition: A summary of hours, wages, benefits & deductions paid & owed to employees who work on a specific project. Mostly required on public (city, state, federal) projects in a standard format (see WH 347, for ex.)
In Context: The Public Agency overseeing a project: “We need you (the Contractor) to submit certified payroll reports for all of your workers and your subcontractors every week to make sure you’re in compliance.”
Definition: An official change to a contract after it’s signed. This can be an increase or decrease in value of the work, scope of work and/or time.
In Context: A Contractor is asked to install additional electric conduits on the second floor. They will be issued a change order for an additional $10,000 and two more weeks of time.
Definition: The person or organization paying for a project. Also referred to as the Owner.
In Context: On a public project, the Client is the City, State or Federal government.
Definition: Certificate of Insurance. This serves as proof that a party/parties is covered under an insurance policy in specific instances. This includes general liability, automobile, workers compensation, etc
In Context: The Contractor provided the Client with a COI, which will protect them in the event that an accident happens or there’s unexpected damage while the Contractor is performing work.
Definition: A company who’s hired by a Client/Owner to act on their behalf to oversee a construction project and the execution of the contract requirements. They do not work with or hire Contractors or Professional Consultant, but rather oversee them on behalf of the Client/Owner.
In Context: The Owner of the building has hired Steve’s Construction Management Firm to make sure Rachel The Contractor and Rob The Engineer complete the design and construction of the building as required.
Definition: A party who is an expert in a particular field, who is hired to provide input and/or perform a service.
In Context: “We want to install a new air conditioning and heating system in our old building, so we’ve hired a HVAC consultant to help us with a design and to hire a contractor.”
Definition: A safety net that is put into place in the event something unexpected or unpredictable occurs.
In Context: “In the event we have more than 10 days of bad weather in April that prevents our Contractor from roofing, our contingency plan is to have them work on weekends, too.”
Definition: An amount of money set aside for unexpected or unpredictable expenses.
In Context: “Our project includes several unknown variables, so we’ve set aside an additional 10% beyond the value of the contract”
Definition: A formal (signed), legally-binding agreement between two or more parties.
In Context: “After reviewing your proposal, we’d like to hire you to design our new electric system. We will issue you a contract to review & sign by the end of the week.”
Definition: Cost-plus contracts are between a Client and a Contractor. The ‘cost’ refers to the costs that the Client will pay to actually do the work i.e. labor to construct a building and equipment/materials. The ‘plus’ refers to the Contractor’s overhead expenses (project staff, office expenses) and profit.
In Context: “We’ve hired the Contractor via a cost-plus contract. This includes $1 Million for actual costs of construction, plus an additional $250,000 for management staff, their office and the Contractor’s profit.”
Definition: The amount of cost that is expected to finish a project.
In Context: “We are 80% finished with building this bridge, and our cost to complete is estimated to be $600,000.”
Definition: The most necessary steps required in order to reach an end goal, the specific sequence they need to be performed in, and the amount of time each step will take.
In Context: “The critical path of getting this building finished is to complete the structure, build exterior walls, do rough interior work, get the exterior waterproof and air-tight, then start work on the final interior finishes.”
Definition: When a contract is signed between parties, damages are established to protect one of the parties in the event another party breaches the contract (doesn’t follow the rules). This can include financial penalties for delays, obligations to fulfill, etc. They’re meant to make the non-breaching party ‘whole’ again.
In Context: “The contract we signed with the Contractor includes a $10,000 fine for every day the project is delayed, as a damages clause”
Definition: Straightforward; the person representing a company, client etc who is able to make important decisions, such as signing contracts, approving financial changes, etc. The person with the final say.
In Context: “The Decision Maker for the State’s Dept. Of Transportation is Ralph Smith – he will need to approve these change orders before you can start any of this work.”
Definition: In Accounting: A deferral temporarily pushes the cost off the company balance sheet. It is a cost that has already occurred ie labor has been spent, vendors have submitted invoices, etc. This is typically done while waiting to receive the funds that are intended to cover the cost being deferred.
In Context: “We spent $25,000 in labor this month on project A, but the Client won’t pay us until everything is inspected. That will be next month. We will defer these costs on the accounting books until next month when we can bill the client for them”
Definition: When an event/goal/deadline/etc has been postponed past the original timeframe.
In Context: “The building was supposed to be finished by August 1st, but the Contractor is delayed by at least one month.”
Definition: When an Owner to hires a designer, then bids the project to contractors based on the design, then hires a contractor to perform the work.
In Context: “In order to build this dam, we will first hire Courtney’s Architecture Firm & Aaron’s Engineering Company to design it. We will send formal RFPs to several contractors to bid on building the design.”
Definition: A specific approach to a project, where a contractor and design firm are hired simultaneously as a partnership/joint venture. They are equally responsible for the successful outcome the design process, as well as performing the actual construction (‘build’). For a different typical approach, see ‘design-bid-build’ above.
In Context: “This railroad will be awarded as a design-build project to Taylor’s Design Services & Acme General Contracting, who will work as a partnership on designing and constructing the new high speed rail system.”
Definition: The Engineer of Record (EOR) is hired by a Client/Owner to develop the fundamental engineering and design requirements of a project.
In Context: While a Contractor working on the project may also hire an engineer to design specific components of a project, the EOR works directly for the Owner and establishes the big picture requirements. They are responsible for the initial design as well as the final sign off of the finished project.
Definition: Drawings produced by an engineer based on stamped engineered calculations. They are drawings that are also stamped by an engineer and visually depict the design that the engineer deems acceptable.
In Context: “We were given engineered drawings to bid this structural steel project, so the exact sizes of all beams, plates, welds and bolts are specified based on the engineer’s official calculations.”
Definition: A software that manages and tracks various data and processer for a contractor.
In Context: The ERP software used by large contractors may track/monitor the accounting, project documents, budgets, productivity, logistics, human resources and even sales.
Definition: Additional time alloted/approved to complete a task. May be due to legitimate causes ie weather delays, added work, as well as illegitimate causes like negligence or underperformance.
In Context: “Since we were asked to redesign the interior of the building, we’ve been given an extension of four more weeks to finish the project”
Definition: A person who is assigned to work onsite and/or oversee jobsite activities, as well as to take notes, document conditions and manage work as it’s happening. Often an entry level position but not always.
In Context: Young recent graduates often become Field Engineers as their first position, because they gain valuable on-the-job experience by seeing work happening and being part of the process.
Definition: Costs that do not change and can be predicted.
In Context: Hiring a subcontractor to perform work on your project for a set price means you know what your cost will be for that portion of the work. Firm subcontract amounts like this, along with prices of material and rental rates of equipment are all examples of fixed costs.
Definition: The amount of time a task can be put off in a schedule, and still get done on time.
In Context: “Our schedule for finishing this skyscraper shows the final window washers starting four weeks before the end of the project, but they’ll only need one week to do the work. Therefore, they have three weeks of float in the schedule in case we want them to start later.”
Definition: A project-specific person of responsibility who is in charge of other workers on a specific crew or jobsite. Foremen often physically work themselves, but are given additional pay and responsibilities.
In Context: The foreman on a project is in charge of supervising other workers and doing some manual work, as well as managing their timesheets, coordinating material deliveries and making sure safety supplies are in stock.
Definition: The contractor hired by a Client/Owner to take on a project in its’ entirety. General Contractors (GCs) hire other contractors (subcontractors) to perform parts of the work. The GC is ultimately responsible for the overall outcome of a project.
In Context: We’ve hired Pat’s General Contracting to renovate our house, and they’re going to hire Johnny’s Masonry Company, Terry’s Plumbing and Ricardo’s Electric to do work related to tile, appliances, water pipes and lighting, respectively.
Definition: A grant is an amount of money or funds that are provided by a governing agency, to be used for a specific purpose.
In Context: “After Superstorm Sandy, we were given a grant from the Federal Government to clean up and rebuild our waterfront parks.”
Definition: Reasons that a party is entitled to certain treatment, conditions or outcomes, based on a governing set of laws, terms in a contract, etc.
In Context: “The Contractor you hired hasn’t shown up to the jobsite or returned calls for the last month. This is grounds for terminating the contract.”
Definition: Also known as Not To Exceed (NTE), a GMP is a contract type that allows the Client/Owner to hire a contractor, pay the exact costs that the project requires, and pay the contractor a fixed management fee. Overruns (going over budget) are to be paid by the contractor, not Client/Owner, in this set up. Underruns (cost savings) go to the Owner if costs are less than expected in the budget.
In Context: A General Contractor is hired via a GMP agreement to construct a building, and will be paid 10% of the cost of construction to manage the work. However, the Owner will not pay more than $10 Million for the cost of the building and $1 Million (10%) for the GC to manage the work. If the cost of construction goes above $10 Million, the GC must pay for it, and they won’t get more than $1 Million to manage it either.
Definition: This is a third party agency, hired directly by a Client/Owner, to perform official tests in the laboratory for a project. ‘Independent’ means there is no connection, and therefore no conflict of interest, with anyone else working on the project.
In Context: A Contractor is hired to build a concrete structure. The Owner will pay an ITL to take samples of the concrete, break them in the lab after 28 days, and confirm the concrete meets the design strength.
Definition: A measurement meant to determine how well or poorly a party is performing against a goal.
In Context: The overall time a project takes, reaching a milestone by a certain date, and the amount of money a project is going to cost are all KPIs for how well the project is going.
Definition: The amount of time it will take to get something or for something to happen.
In Context: “What’s the lead time on the marine grade stainless steel brackets from Dave’s Specialty Bracket Company? Will we get them within four weeks?”
Definition: A document that can be held up in court to determine official rulings. Any document signed by two or more parties with specific terms is considered a legal document.
In Context: A signed purchase order, signed contract and even an email specifying terms/representing consent between parties are all examples of legal documents.
Definition: An item that takes a long time to get.
In Context: “If you want to have this pre-fabricated steel building delivered beforee the end of the year, you’d better sign a purchase order soon – it has a long lead time of 5 months!”
Definition: A short term schedule/plan meant to outline the steps that will be taken to keep a project on track. A L.A. scheudle is typically shorter in timeframe, like two weeks, four weeks, etc. and outline small details.
In Context: A two week L.A. schedule on a construction project will outline resources, timeframes, schedules and other key pieces of information that are needed in the next two weeks on the project.
Definition: A type of contract in which a Client/Owner hires a contractor to perform the entirety of work on a certain project for one fixed price. Also known as a Fixed Price Contract.
In Context: “We hired one contractor to remove the old duct work and install a new HVAC system for the lump sum of $425,000.”
Definition: Means and methods are essentially how a portion of work will be performed, broken down into steps. They often include tools, equipment, access and safety measures required for each step.
In Context: “Your approved means and methods plan indicates that you’ll be using hand tools to remove the old stone off the façade, but your workers are using power tools!”
Definition: Official records of what was discussed and agreed to in a meeting. Typically issused to all parties in attendance after the meeting.
In Context: “The minutes from our last meeting indicate that you were going to submit these documents by the end of last week, but you have not.”
Definition: Named after Capt. Edward Murphy, Murphy’s Law states that “anything that can go wrong, will go wrong”. Often associated with superstition.
In Context: “We had beautiful weather all last week while waiting for this special exterior paint to come in, but now that we have it, it’s supposed to rain the next seven days straight. Murphy’s Law!”
Definition: A ‘telegram’ you don’t want to get. A Nastygram is an email or letter expressing the displeasure that another party feels for you or your company.
In Context: “We’re over a month delayed on finishing this project, and we just received a Nastygram email from the Client telling us how bad we’re doing.”
Definition: Terms of credit where payment from one party to another is due within 30 days. This can be within 30 days of placing an order or 30 days of performing a service.
In Context: “We hired Liz’s Surveying Company to survey the vacant lot. The contract we signed is net 30, so we need to have a check cut within 30 days of receiving their official survey report.”
Definition: Items that do not fall on the critical path of a project sequence/schedule.
In Context: “Getting the building water tight by Aug. 10th is on the critical path, but installing the exterior brick is not. That work can start after the building is watertight, and has five weeks of float before it needs to begin.”
Definition: A stipulation that a cost of a project, service etc. will not cost more than a set amount.
In Context: “We’ll award you $50,000 to demolish the old garage, but that is a Not-To-Exceed figure. Are you willing to perform the work?”
Definition: An official document issued by a Client/Owner/Contractor (to a subcontractor) to begin work on a specific date.
In Context: “We received a NTP from the Owner of the Gould Building, and they want us to begin exterior renovation on April 3rd.”
Definition: The actual profit left over once the costs of a project, as well as the overhead & operating expenses, have been paid.
In Context: A $1 Million dollar project may have costs of $750,000 to get the work done, plus $150,000 in overhead expenses (project management, office costs), leaving $100,000 in Operating Profit.
Definition: An arrangement where the Owner of a project pays for an insurance policy that covers the entirety of all the work and the contractors working onsite.
In Context: “Since we’ve set up an OCIP on our project, all of the contractors we’ve highered have lowered their prices, since they don’t need to purchase their own insurance”
Definition: A person or party who has been officially designed at the representative of the Client/Owner. They may work directly for the Owner, or are hired to act on their behalf. They are the Decision Maker.
In Context: “The Owner of the building is technically Ms. Donovan, but she’s hired Top Rank Construction Management to act as the Owner’s Rep.”
Definition: The terms agreed to between two or more parties that spell out when one party pays the other(s), on what grounds they will pay/not pay and how much time they have to pay (see Net 30).
In Context: “The payment terms of the contract state that the Owner will pay us 25% of our contract up front, but will only pay the remaining 75% within 60 days (Net 60) after we’ve finished.”
Definition: When bidding or budgeting a project, a plug number is entered into the budget breakdown as an estimated placeholder price until an official quote is in hand.
In Context: If a contractor is bidding on a construction project and doesn’t have a price/SF for flooring, they may enter something like $10/SF until they get a quote from a manufacturer.
Definition: Literally translating to “after death”, a Post Mortem Report outlines the good, the bad and the ugly of a project; where it went well, mistakes that were made and lessons learned.
In Context: A Contractor will often sit down and put together a Post Mortem Report of all the lessons they learned on a specific project, so future instances can be prevented and mistakes don’t happen again.
Definition: An item, structure or portion of a structure that is either already assembled before it’s delivered onsite, or is very easy to assemble parts by following a set of instructions.
In Context: A gazebo kit, a warehouse kit fabricated by a specific manufacture and an exterior siding system are all examples of prefabricated items. Also, Ikea is prefabricated furniture.
Definition: Similar to a draft, anything noted as preliminary is an early version/preview of the official version.
In Context: “Here is a preliminary schedule. We still are figuring out the exact timeframes for tasks a, b, and c but we’ve made assumptions. Once we get those timeframes figured out, we’ll provide to you an official schedule.”
Definition: This is an agreement established between a Client/Owner and a Contractor. This contract is ‘Prime’ because all other contracts or agreements between the contractor any any subcontractors are subsequent to the prime agreement.
In Context: “You, as a subcontractor of ours (the Contractor), shall agree to scope-specific terms a, b and c, plus all of the general requirements outlined in our Prime Agreement with the Owner.”
Definition: The rate at which work is being performed.
In Context: A plumbing contractor installing a new sewer line may estimate a production rate of 100 feet of sewer pipe installed per day.
Definition: A person who is educated, licensed and sufficiently experienced to act as an engineer, who is responsbile for producing a safe, code-compliant design. In the US, P.E.s are licensed to work in a specific State.
In Context: “We’ll need to remove this load bearing wall in order to expand our kitchen. We need to hire a Professional Engineer to design a temporary support system and a permenant structual column first.”
Definition: After being paid for a project/service and paying for all costs, the profit is what’s left. This usually does not include overhead costs like magamenet staff and office expenses (see Operating Profit)
In Context: “After paying for the labor, equipment and materials needed to renovate the Client’s driveway, we should be left with a profit margin of $5,000.”
Definition: A member of the project staff who is responsible for planning, reviewing and overseeing all things technical on a specific project. Note that the Project Engineer may not be the Engineer of Record for the project, or even act as a Professional Engineer on the project.
In Context: “You need to get the Project Engineer’s approval of your drawings, equipment and means & methods plan before you can begin work”
Definition: Typically two levels of authority above the Project Manager and one level above Senior Project Manager, Project Executives are responsible for the big picture stragetic decisions on several projects, often looking at the projects from a holistic perspective, for the overall benefit of the company.
In Context: Jessica is the Project Manager on Project X, and Fred is the Project Executive overseeing that plus three more. Fred meets with each of the PMs twice per week to review the project status.
Definition: The person directly responsible for the day to day operation and overall outcome of a project.
In Context: Every month, all of the Project Managers working for a contractor are responsible for reporting on the project profitability, schedule and general performance to upper level management.
Definition: The team of people responsible for managing all of the project’s needs
In Context: On a large skyscraper project, the project team can consist of hundred of individuals, ranging from Field Engineers & Administrators to upper level executives.
Definition: A list of remaining miscellaneous, smaller tasks that are left for a Contractor to complete near the end of a project. The official punchlist is typically agreed upon with the Client/Owner and Design Architect after a site walk.
In Context: At this point, the project only had about five punchlist items on it like garbage removal, sweeping, etc., they shouldn’t take more than a couple of days to finish.
Definition: A document signed by two or more parties for the purchase of something. This can be anything from software to a piece of equipment. Similar to a contract, they include a list of terms and conditions
In Context: A contractor is renovating a library, which has marble stone steps out front. The mason will sign a P.O. with the stone fabricator for the purcahse of the stones.
Definition: Similar to terms and conditions, qualifications and exclusions specify additional details about the scope of work, or exclude specific work items.
In Context: A contractor is hired to completely renovate a house. In the agreement signed with the Owner, they have qualified that they’re not responsible for maintaining the yard and have excluded any repairs to the landscaping.
Definition: A plan and/or process of maintaining a standard level of quality during a process.
In Context: On many projects, contractors are required to submit a quality control plan for approval before beginning work onsite. The Owner or Architect may ask for additional information or ask for changes when they consider the specifics of each work type.
Definition: A quote is the price a vendor is charging for an item, or list of items. Typically written, quotes include a pricing summary for the items requested, and usually a limit on how long the price is good for.
In Context: For the chandeliers in the hallways, we’ve gotten quotes from three different lighting fixture stores.
Definition: An official written request for payment. Also known as a bill. In construction, this is often on an AIA G702 and G703, which are a commonly used formats for a bill’s cover sheet and itemized breakdown, respectively.
In Context: The contractor will submit requisitions for payment on the last calendar day of each month.
Definition: An RFI is a formal request that a contractor submits to the design team. This can be a request for clarification, general information, substitutions or alternatives, etc.
In Context: The Owner’s Engineer specifes that the contractor install structural anchors made by a certain company, but the contractor submits an RFI to request if they have any alternative products that they’ee OK with.
Definition: An RFP is an official request that a purchaser will issue to several firms in order to get their price.
In Context: A school is getting renovated, and a new gym will be built. The General Contractor will issue RFPs to several companies who specialize in building gyms.
Definition: The accumulation of small changes and slow rise in expectation that the contractor owes more, based on the Owner’s opinion of the scope of work. The more loosely defined a contract/agreement, the more likely this is to occur.
In Context: The Sanborn family hired a contractor to remove old cabinets and install new ones. They sign a basic, vague agreement for $15,000. After the contractor has begun, the Sanborns state that they expected a new tile backsplash (between cabinets) and new crown molding in front of the cabinets, matching the old ones. They state that it’s part of the work. The Contractor is experiencing the beginning of scope creep!
Definition: The general list of project tasks, requirements and finished product deliverables. An all-encompassing summary of everything required in a contract.
In Context: The HVAC contractor has fabricating and installing new duct work at the church, but their scope of work does not include asbestos removal beforehand.
Definition: An order of events to reach a desired outcome.
In Context: The sequence of bridge deck repair includes jackhammering out old concrete, fixing rebar, removing dust and then pouring new concrete.
Definition: These are drawings drafted and submitted by a contractor or fabricator that show the details of the work to be performed. This includes dimensions, specific elements, products and sometimes a Professional Engineer’s stamp.
In Context: The glass curtainwall installer has submitted shop drawings for the glass window system they’ll install. They include callout information such as types of glass, opening dimensions, fasteners, caulking, gaskets, etc.
Definition: The written requirements of a project, which include performance needs, specific products, standard of quality and performance, dimension tolerances, technical requirements, submittal needs, etc.
In Context: The Architect included a written book of specifications for contractors to bid off of, which will become part of the official contract.
Definition: The overall situation in a nutshell.
In Context: What’s the status of that coffee? When will it be ready?
Definition: Stored materials are bought by a contractor, billed to the Owner, and stored offsite until ready for use. This is often done to purchase material at a good price before it increases, or to have it readily available. The material is usually sold to the Owner via a Bill of Sale document.
In Context: A project requires 10,000 board-feet of special teak wood. The Contractor bought it all at once, charged the Owner for it, and is storing it in a warehouse until it’s needed. The Contractor ‘sold’ the material to the Owner via a Bill of Sale they signed, and the contractor provided the Owner with a COI covering the value of the material.
Definition: A contract issued by one contractor (‘Prime’) to another (subcontractor), for the performance of a portion of the work. This usually reflects terms from the Prime Contract between the General/Prime Contractor & the Owner.
In Context: A Subcontract was issued to Brianna’s Flower Specialties by Manuel’s Landscaping to plant a flower garden in the front driveway.
Definition: A contractor hired by another contractor to perform a portion of their work.
In Context: The Contractor renovating the house is doing all the wood framing, but they are hirong a subcontractor to do the drywall.
Definition: A document, drawing or sample submitted to a party for approval.
In Context: The Architect requires a submittal package from the roofing contractor, including technical data and samples of the roof underlayment, waterproofing and finished surface
Definition: The designated person in charge of supervising and overseeing an entire project in the field, including timely performance of work, safety and quality. Works closely with other project management staff.
In Context: Mark is the Superintendent on the jobsite, and oversees all the foreman that are in charge of each labor crew. He makes sure every employee is working safely, work is on time, logistics qre running smoothly, etc. Often feels like the project babysitter 😉
Definition: An arrangement where a contractor performs work and bills the Client for the exact amount of labor and material spent, plus a pre-arranged profit margin.
In Context: “Since the widening of the doorway wasn’t in your scope of work, go ahead and do the work T&M, and send a breakdown of the hours it took you. We will pay you for the exact cost plus 15% to cover overhead and profit.”
Definition: When a cost is below the expected budget.
In Context: “Luckily we had a big budget underrun on the cost of paving the runway. We spent only 85% of the budget!”
Definition: A cost that cannot be determined for sure, but only reasonably estimated.
In Context: The total cost of labor it will take to complete a building are only estimated by contractors when pricing their work. They then need to make sure their total labor cost ends up being equal to or lower than the budget. The faxt that the exact cost of labor cannot be determined makes it a variable cost.
Definition: A supplier, manufacturer or store that sells materials, equipment or supplies.
In Context: At Sam’s National Contracting, we have a list of pre-approved vendors that we can buy materials from at exclusive corporate pricing.