35
Should I Go or Should I Not Go? DPLE 175 January 18, 2017
Should I Go or Should I Not Go?
DPLE 175
January 18, 2017
RLI Design Professionals is a Registered Provider with
The American Institute of Architects Continuing Education Systems.
Credit earned on completion of this program will be reported to
CES Records for AIA members. Certificates of Completion
for non-AIA members are available on request.
This program is registered with the AIA/CES for continuing professional education.
As such, it does not include content that may be deemed or
construed to be an approval or endorsement by the AIA of any material
of construction or any method or manner of handling, using,
distributing, or dealing in any material or product. Questions
related to specific materials, methods, and services will be
addressed at the conclusion of this presentation.
Copyright Materials
This presentation is protected by US and International
Copyright laws. Reproduction, distribution, display and
use of the presentation without written permission
of the speakers is prohibited.
© RLI Design Professionals
Course Description
Why do firms take on projects that they think could be destined to fail? When you spend
time analyzing the possibilities, you can start to see future problems.
Our approach will guide you through the four steps of risk management—carefully
identifying, assessing, managing, and controlling the risks in projects when you’re deciding if pursuing a project is a good idea.
Learning Objectives
Participants in this session will:
Understand how the type of
project and its delivery method
can indicate future problems
Learn to identify the different risks associated with a project’s location
Gain an awareness of how people
involved in a project can have an impact on the
overall assessment of
risk
Consider how different project
processes can act as a forecast of potential issues
Definition
Risk
����Probability or threat of damage, injury, liability, loss
����Caused by external or internal vulnerabilities
����May be avoided or mitigated through prevention
Go/No Go Matrix
How to Use It
Project
Project Risk – Step 1
Identify
Assess
Mitigate
Control
“Project” Risks to Consider
Project type
Knowledge of specific project
Comfort with delivery method
Management of pre-existing conditions
Overall assessment of project/services
Project Risk – Steps 2-4
Identify
Assess
Mitigate
Control
Delivery Method
Design Build
Design Bid Build
Example:
Case Study – “Desert City”
Would you
know how
to design
an HVAC
system for
this
location?!
Place
Place Risk - Step 1
Identify
Assess
Mitigate
Control
“Place” Risks to Consider
General assessment of project location
Concerns about specific location
Knowledge of location
Overall assessment of location based on external factors
Place Risk - Steps 2-4
Identify
Assess
Mitigate
Control
Example:
Knowledge of Location
https://www.fs.usda.gov/Internet/FSE_DOCUMENTS/stelprdb5363905.pdf
Case Study – Hidden Hazards
http://www.pbs.org/wgbh/nova/next/earth/manmade-earthquakes/ https://www.scientificamerican.com/article/drilling-for-earthquakes/
People
People Risk - Step 1
Identify
Assess
Mitigate
Control
“People” Risks to Consider
People
• Assessment of client/owner
• Comfort level with client/owner
• Availability of dedicated decision-maker (for client)
• General assessment of design/construction team members
• Financial evaluation of team members
• Overall assessment of team members
People Risk – Steps 2-4
Identify
Assess
Mitigate
Control
Financial Evaluation
Insurance Limits
Example:
Case Study – Rockridge Elementary School
Which
one
has
the
deepest
pocket?
Process
Process Risk – Step 1
Identify
Assess
Mitigate
Control
“Process” Risks to Consider
General assessment of procurement process
General assessment of contracting process
General assessment of risk allocation process
Risk-reward assessment
Overall assessment of processes associated with the project
Process Risk – Steps 2-4
Identify
Assess
Mitigate
Control
Example:
Risk Allocation
Owner
Contractor
Designer
HVAC
MEP
Interior
Differing Site Conditions AIA Language – A201
• § 3.7.4 Concealed or Unknown Conditions.
If the Contractor encounters conditions at the site that are (1) subsurface or otherwise concealed physical conditions
that differ materially from…Contract Documents or (2) unknown physical conditions of an unusual nature, that differ materially from those ordinarily found to exist and generally recognized as inherent in construction activities of the character provided for in the Contract Documents …Contractor shall promptly provide notice to the Owner
and the Architect…Architect will promptly investigate such conditions…
Case Study – Differing Site Conditions
Risks belong with those parties who are best able to evaluate, control, bear the cost, and benefit from, the assumption of risks.
Every risk has an associated and
unavoidable cost which must be
assumed somewhere in the process.
Many risks and liabilities are best
shared.
Metcalf Construction Company v. United States
Final Assessment
Warning Signs
Perceived (or real) need to get more
projects on the books
Inadequate tools to evaluate project risks
Difficulty telling a client “no”
Impact of Ignoring Risk
Increased costs
Loss or reduction in profit
Damage to reputation
Insolvency
Take Away
Risk
Your
Manage
RLI Procedure for Premium Credit
Access On-Line
Submit as Part of
Renewal
Receive Credit at Renewal
This concludes The American Institute of Architects
Continuing Education Systems Program
Alayne McDonald, Professional Development Coordinator
Abbey Brown, Client Solutions Manager
