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      Scope, Budget and Schedule of Construction Projects

      Construction Projects

      Construction Projects are defined by their scope, budget, and schedule.

      For example, an Agency is to undertake a project to design and build a new maintenance facility for its fleet of buses (scope), at an estimate of $30 million (preliminary budget) over a three-year period of construction (schedule). The schedule specifies a defined beginning and end. Projects go through a life cycle of phases between their beginnings and ends that for construction projects are typically: initiation, planning, design, construction, commissioning, and closeout.

      Scope: Each project is unique and must have a written requirements document that takes into consideration operational needs, level of service, regulatory requirements such as Americans with Disabilities Act, and quality of deliverables. The scope evolves as new information becomes available through the project life cycle. For example, in the early planning phases of the maintenance facility project, the scope is to have five service bays. Later, as the design progresses, the exact location and the type of service in each bay can be determined. Scope refinement should not be confused with scope creep. Scope creep occurs when the Agency determines part way through the project that operational projections now call for six rather than five service bays. Changing to six bays after the project is underway is a serious change in scope that could impact the budget (larger facility, more land, redesign) and delay the schedule (replan, redesign, longer construction). Scope refinement is a necessary process in the project life cycle while scope creep results from lack of clarity on the Agency’s requirements in the original scope for the needs, level of service, and level of quality for the deliverables.

      Schedule: All projects must have a definite beginning and end. The Agency’s Capital Improvement Plan (CIP) usually provides approximate dates for the beginning of a project and the end date when it is due to go into operation. Once there is a well-defined scope, the Agency needs to determine the time it will take to complete the project by developing the project schedule. Developing the schedule involves breaking down the work into manageable activities needed to accomplish the scope of each deliverable, estimating the duration of each activity, and placing them in a logical sequence. The result is a project schedule that tells you the expected duration of the project and the logical relationships between the activities, including activities on the “critical path,” that controls the end date.

      Budget: All projects are constrained by limited monetary funding resources. Consequently, every project needs a budget to initially define its funding requirement. The project manager develops the budget based on the cost estimates at the beginning of each project phase and refines it once there is better information defining the scope. Refining the budget occurs through studies and analysis in the design development process through the preliminary engineering phase. When Agencies try to fix the budget too early in the project life cycle, they are surprised by the significant increases in the budget over what was set forth in the CIP. The budget should not be fixed as baseline until after completion of the preliminary engineering phase.

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