E-news for the Construction Division February 2007

PEC Offers Hot Construction Webseminars

February 21 12:30 — 2:00 EST
Green Building — Where's the ROI and Marketing Advantage
Gary J. Saulson, Head of Corporate Real Estate, PNC Financial Services

March 21 12:30 — 2:00 EST
Brownfields Sites — Grants and Incentives to Cleanup and Redevelop
John A. Sartor, P.E., P.P., Senior Vice President, Paulus, Sokaloski, and Sartor, LCC (PS&S)

April 18 12:30 — 2:00 EST
Through the Roof — Escalating Construction Costs
Michael Kennedy, Principal, Stantec Consulting Inc.

For more information on these topics, the sessions and the speakers visit the PEC Web site.



Top 10 Ways to Conduct More Effective Meetings

Herbert M. Cannon, president of AEC Management Solutions Inc.


10. Invite only those people who are absolutely essential to the meeting.
Cannon's Law of Meetings states: The productivity of meetings is inversely proportional to the number of attendees. Not only are more attendees less productive, they are also not participating in revenue producing billable activities.

9. Use meetings to make decisions not to disseminate information.
I absolutely hate showing up for a meeting only to be given a handout of information that we will then be lectured on. The problem with this format is that while the author of the handout is talking about information on page 1, attendees are thumbing through to page 10 and no one is paying attention to the speaker. Distribute any handouts before the meeting so people have time to review and digest the information. Once the meeting begins, you can start with a productive discussion that leads to a decision or further action.

8. Have an agenda for the meeting.
An agenda for the meeting will keep it on track. Everyone's time is too valuable for every meeting to become an open forum.

7. Have a Chair for the meeting.
Someone needs to be in charge of the meeting. That person needs to start and end the meeting on time, keep everyone on topic and move things along.

6. Eliminate the meeting when it is no longer needed.
If the meeting no longer serves a useful purpose, cancel the meeting. I am talking about those standing meetings that we all have. Every three months or so review your standing meetings with a critical eye toward reducing the frequency of meeting, reducing the number of attendees, or eliminating the meeting altogether.

5. End the meeting on time.
Let's meet, discuss what we have to, make our decisions, and move on. It is up to the Chair to make sure all meetings end on time. One way to end meetings on time is to schedule meetings close to lunch—and don't have anything available for people to eat. Hunger will take over and the meeting will finish on time.

4. Fine people for showing up late for meetings.
An effective way to emphasize the importance of being on time is to have a monetary penalty for showing up late for the meeting. The fine can range from $1 on up to whatever it takes to make the point. When an employee waltzes in 1 minute or more late for a meeting they are forced to pay a $1 on the spot. It is actually a lot of fun to enforce the fine and people do get the point. The fines are collected and eventually donated to a local charity.

3. Prepare an action list.
At every meeting, prepare an action list of what decisions were made or what additional action is needed, who is responsible for taking action, and when. For example, an action item might be: Herb Cannon will call the client about past due invoices no later than November 3rd and report back to the Principal in Charge as to when payment can be expected. This action item includes what has to be done, who has to do it and by when. If no action items are produced at the meeting, please refer back to item number 6 and question the need for the meeting.

2. Review the action Items at your next meeting.
Make the first thing on your agenda for the next meeting to review the action list from the last meeting. People are much more likely to take action and follow-up on their commitments if they know it will be reviewed at the next meeting. Give it a try— you will be amazed at the results.

1. Show up on time and be prepared .
Woody Allen says that 80% of success in life is showing up. I would modify this somewhat to say that 80% of success in business is showing up well prepared and on time.

Over the years I have seen ridiculous excuses for people not showing up on time. One of my "favorite" incidents happened about 7 years ago when I arrived in New York City for a meeting at 8:00 a.m. on a Monday morning. In order to make it to the meeting on time, I had to leave my house at 6:30 a.m. for a 1½-hour commute. At 8:25 a.m. one of the Principals of this firm, who lived about 20 blocks away, strolled in and declared that it was such a gorgeous day he just had to walk to work that day. Those of you who know me can only imagine my reaction. Here was a Principal in a firm that thought it was okay to show up 25 minutes late and waste the time of 10 other people so he could enjoy a leisurely stroll to work.

Be considerate of others. Their time is just as important as yours and the success of any business depends upon people being where they are supposed to be, when they are supposed to be there. If people in your company can't meet this low threshold of accountability, you are doomed to under achieving at best.

Herbert M. Cannon, president of AEC Management Solutions Inc. and publisher of AEC Managing Partner Newsletter, is a management consultant, seminar provider, and speaker exclusive to the A/E industry. He is available to speak at company meetings and conferences. For more information, contact Herb via
e-mail or visit his Web site. 

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Professional Liability/Risk Management Brief

Richard B. Garber, Vice President A/E/C Risk Management Services, Victor O. Schinnerer & Company, Inc.

Change Orders

The use of change orders is a basic element of the design and construction process because changes are a virtual certainty on all construction projects. Yet change orders are a continuing source of disputes and can disrupt the orderly completion of a project. If the processing of change orders is to go smoothly, all parties must recognize their proper roles.

Define the Process
The construction contract needs to define the change order process. On a design-bid-build project, the construction contract is between the client and contractor. A change order is a modification to that contract, and the client and contractor must approve all changes. Therefore, the design professional has no inherent power to make changes to the construction contract. The agency relationship, however, normally grants the design professional the power to interpret the contract documents and to make minor changes that do not affect the construction cost or the time to perform the work.
Involve the Design Professional
The realities of construction have led to a common practice whereby the client is allowed to direct the contractor to perform changes to the contract even before the costs of such changes are negotiated. Normally, however, the contract documents require that all three parties—the client, contractor, and design professional—sign a change order before the contract is changed. Even though the design professional is not a contractual party, the design professional signs the change order because the client is entitled to the advice of the design professional before taking action that affects the work. And since the changes may affect public health, safety, and welfare, the changes require the approval of the design professional.

The details of the proposed change—usually drawings and specifications—should be submitted in advance to the client with enough data so that the client can make an informed decision. The cost of a change order is not just the time and cost for construction. The client must be aware of the preparation time and compensation to the design professional.
Include a Contingency
At times, the design professional is asked via contract to assume responsibility for the costs of all changes. Provision of a contingency budget by the client for a reasonable level of change orders is prudent. The shifting of all responsibility above that contingency to the design professional, regardless of negligence and irrespective of whether the cost is to restore harm or add value to the project, is inappropriate and in excess of the design professional’s normal legal liability.
Define the Design Professional’s Responsibility
Absent a contractual provision to the contrary, the design professional is responsible for any increased cost a change order causes the client if required because of the design professional’s negligence. This does not mean that the design professional is responsible for the “betterment” of the project costs resulting from differing site conditions, government-required changes, or client-requested modifications during construction, nor does it mean that incremental costs of change orders are the responsibility of the design professional. A sample contractual provision might read as follows:

The design professional is responsible for the reasonable costs of a change order directly associated with negligent errors or omissions on the part of the design professional, less the increased value to the client created by such change order.
Strictly following a rational change order procedure and documenting the decision process can assist in reducing the potential change orders have for generating unnecessary misunderstandings, conflicts, and costs.

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NSPE Cosponsors AAA Construction Mediation Conference


The Construction Mediation Conference: What you Can't Not Know
March 30
Bank of America Tower Conference Center
Miami, Florida

At this conference, indispensable information about construction dispute resolution through mediation will be provided to you.

The American Arbitration Association—and Mediation?
The American Arbitration Association (AAA) is not just about arbitration. We know the issues and have got answers for you from some of the construction industry’s best-known experts. You’ll hear how to:

  • Answer the question of whether or not to mediate.
  • Fit the mediator to the case.
  • Use multi-member mediation teams in complex disputes.
  • Use concepts such as expected value, break-even analysis, risk aversion, utility and value of perfect information in mediation.
  • Effectively use the mediation conference to accomplish party, counsel and mediator goals.
  • Assess whether mediations may be vulnerable to lawsuits.

Who will be there?
This conference is geared to all sectors of the construction industry. You will interact with speakers and other professionals attending the conference, including construction-company owners, contractors, developers, architects, construction-industry attorneys and engineers. 

Register online today – space is limited! 


 Click here for the detailed program brochure.



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Take the 2007 Milton F. Lunch Ethics Contest Challenge

All current NSPE individual members, NSPE state societies, and NSPE chapters (including student chapters) are invited to participate in the 2007 NSPE Milton F. Lunch Ethics Contest. Here's your opportunity to match your wits with experienced PEs and engineering students throughout the country!

Contestants are encouraged to analyze the facts of a real situation involving the ethical obligations of a professional engineer as a member of the United States military. Contestants must develop discussion and conclusions about the ethics of the engineer in the case using the format of the NSPE Board of Ethical Review. Entries must be 750 words or less and must be received at NSPE Headquarters by April 20.

The winning entry will receive a certificate, recognition in PE Magazine, and an award of $1,000 ($500 to the NSPE state society or NSPE chapter and $500 divided among the authors), provided by the NSPE Educational Foundation.

Judges will decide the winner based on quality of the entry in form and presentation; demonstration of understanding of the implications concerning ethical or unethical behavior; and comprehensive analysis of the case and arguments supporting your conclusions.

The contest is named for NSPE’s former general counsel, who played a key role in the founding of the NSPE Board of Ethical Review.

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Companies Compete for National New Product Award Honors

The 2007 NSPE New Product Awards program is now inviting entries for exemplary new products that demonstrate the innovative use of engineering principles and provide overall benefits to society through February 15, 2007.

Now in its 25th year, the program was developed and is coordinated by NSPE’s Professional Engineers in Industry in an effort to recognize new and improved products that stimulate the life and growth of the U.S.

Any new product, machine, process, or material that has been developed or manufactured only in the U.S. may be entered provided that it was first placed on the market between 2002 and 2006. Entries are judged on annual sales and economic impact, innovative use of engineering principles, and improved function.

For further information and nomination forms, contact Erin Garcia at 703-684-2884.

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2006-2007 PEC Executive Board

Arthur DeWit, P.E., F.NSPE
Lake Havasu, AZ

Immediate Past Chair
E. Terence Foster, Ph.D., P.E., F.NSPE
Omaha, NE

Leonard "Bud" Darby, P.E.
Alexandria, VA

James Goedert, Ph.D., P.E.
Omaha, NE
Northeast Region Vice Chair
Jon Drosendahl, P.E.
Glenshaw, PA
North Central Region Vice Chair
Southeast Region Vice Chair
James Neff, P.E.
Gainesville, FL
Southwest Region Vice Chair
Paul Bakken, PE
Centennial, CO

Central Region Vice Chair
Carl Meglan, P.E.
Columbus, OH

Western and Pacific Region Vice Chair
William Beery, P.E.
Hilo, HI

PEC Staff Liaison
Kim Granados, CAE

PEC Homepage 

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