Claim Analysis Specialists - the morticians of project controls

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. A claim assumes failure to follow the contract by at least one contractual party and a dispute on the responsibility or impact. Given Proove’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.