Critical Appraisal for Optimum Commercial Management Report

This report provides a critical appraisal of commercial management in the context of a new building construction project for an insurance company relocating its operations. It advises on project planning, emphasizing the creation of a systematic design, selection of a suitable contractor, and accurate cost estimation, including considerations for site risks associated with a former chemical manufacturing site. The report discusses soft landings for a smooth transition, sustainability through environmental assessment and cost management, and ethical considerations by adhering to international standards. Furthermore, it delves into pre-contract cost control, stressing the importance of informed decisions, regular cost plan updates, and value and risk management. The value management section highlights steps for efficient value management, while risk management focuses on monitoring and controlling costs throughout the project, ensuring the client's objectives are met within budget and timeframe.

Running Head: CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL
MANAGEMENT
CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
Name of the Student
Name of the University
Author Note

1CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
Executive Summary
The purpose of this paper is to advice the clients in successful construction of the
building within the time limit, before the completion of lease period of the existing building.
The study is supported by analysing the importance of Building Information Modelling and
the concepts of pre-control cost control process. It is found that, Smooth transactions can be
done through soft landings, collaboration with Building Information Modelling, optimum
cost valuation and selection of appropriate contractor.

2CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
Table of Contents
Introduction................................................................................................................................3
Discussions.................................................................................................................................3
a..............................................................................................................................................3
b..............................................................................................................................................7
c..............................................................................................................................................8
d............................................................................................................................................10
e............................................................................................................................................11
f............................................................................................................................................13
Conclusion................................................................................................................................14
References................................................................................................................................15

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Introduction
A company is relocating its insurance business of around 1000 staffs to a new office.
Hence, a new site is selected for the building construction. The site was previously used by a
chemical manufacturing industry. The waste material was removed through demolition. The
client wants the project to be completed within the lease expire period of the existing
building. Robert is the quantify surveyor for the client. The first part of the appear has
provided a basic advice to the clients related to project planning, sustainability and ethical
considerations during the construction process. The next part has discussed on value and risk
management, pre-contract cost control system. The last part is on collaboration with BIM.
The intense of this paper is to provide an advice to the clients for successful completion of
the project within the expire time of lease.
Discussions
a.
Planning of the contract
The following steps are to be considered by the clients for a successful
implementation of the new building:
 Create a systematic design of the plan- There must be a rough layout of the new-
purpose building and views on the exterior environment of the building.
 Selection of a proper contractor for the process- Suitable contractors must be selected
for successfully implementing the project. The contractors must have a general idea of
the building and the materials selected for the new project (Vasquez 2019).
 Cost estimate- Proper estimation of the costs required for the civil work must be
calculated on the basis of unit rates for the project site (Nazari and Keypour 2019).

4CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
Estimation of the building cost, cost for electricity supply, equipment cost and other
operational costs for the process.
Site Risks
The new construction site for the building was previously located as a chemical
manufacturing industry. Therefore, the client must focus on minimising the risks related to
working conditions, handling of materials and environmental related hazards in the
construction sites (Jia, Rowlinson and Ciccarelli 2016). Following risks are to be measured
and considered by the clients, before the selection of the new projects:
1. The workers in the new construction site are often required to use large machines and
tools for the construction process. They even have to work at a height in the sites
which is quite dangerous for the workers in the site.
2. The client has planned to setup the building in the site, which was previously located
as a chemical manufacturing industry. They must quantify the risks after the
demolition of the industry. The contractor must clear the site properly by removing
the obstacles on the site that may affect the workers. The contractors must start the
work before the approval by the engineer (Lackey et al. 2019).
3. The client must mitigate the risks related to hidden physical working condition in the
site. These conditions includes proper availability of the resources & materials,
suitable soil & rock conditions, availability of equipments and many more.
4. They must also consider the risks related to natural disaster on the construction site.
This may damage the physical assets and property of the building. The risks
associated with natural disaster will also damage the important raw materials required
for the construction process. The client must properly mitigate this risk of weather
uncertainty in the construction site before building the new-purpose project.

5CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
5. They must also quantify the risks related to proper availability of building materials in
the construction site (AlMushcab et al. 2019). The site must be selected near a place,
where there is sufficient availability of materials that is required for new-purpose
building.
6. The client must also quantify the socio-political related risks that may be associated in
the construction project. The site selected for the construction of the building must be
authorized with a proper codes and regulations and should not be affected by any
social or political risks.
Soft Landings
The clients must ensure that the transitions done for relocation of their old offices to
the selected construction site is properly optimised. The overall transition process needs to be
considered by looking into the overall development of the project, not just on that particular
period (Maldonado, Soueres and Watier 2018). This can be done by developing a soft
landings framework for the smooth transition of the construction process and address the
required problems. The soft landing framework must consider the following terms:
 The client must clearly define the required outcomes and needs for the construction of
the new purpose-building.
 The client must review other sites and compare the projects while assessing the
construction site. They must focus on delivering effective services and maintain the
facility management for smoothening the process.
 They must also ensure that the operators have a clear knowledge of the working
process (Chen 2017).
 They must also resolve the various issues related to the construction process and
ensures a proper care of the operations is done during the process.

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Sustainability
The construction of new building will consume more time, cost and resources. Hence,
the client must be committed to the sustainability of the building. Relocation of the
organisational staffs from the old office to a new office will meet the present needs (Clayton
and Radcliffe 2018). The clients must also consider the future generations of the insurance
business by examining the social and economic sustainability of the building. They must
account the following issues for business sustainability:
1. The construction of new office does not harm the external environment of the
business. This can be done by undergoing an environmental assessment process
(Baland, Bardhan and Bowles 2018).
2. The client must ensure an effective cost management by focusing on managing and
controlling the cost. They must execute a cost management plans for quality
production and sustainability of the project. The cost must be estimated at an accuracy
levels (Montabon, Pagell and Wu 2016). This can be done by appropriately defining
the direct and indirect costs associated with the construction activity.
3. The clients must also consider a proper advisor that has a specialist knowledge of
sustainability of business during the early stage of construction process.
Shifting of an office to a new site will cause various changes in the working practices.
Hence, this may cause an issue to the top management and staffs of the company. The client
must be versatile in selecting the materials, tracking various records, proper monitoring of the
work and derive knowledge to the staffs through training & development programme.
Ethical Considerations
Ethical considerations is very important sustainable solutions for building sustainability.
Following are the ethical considerations for business sustainability are:

7CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
 Following the International code of Ethical standards for professionals in the
construction of a new purpose-built building.
 Selection of the new site must satisfy the environmental and society for construction
law of ethics (Wada, Tomokiyo and Maeda 2016). This law will address the issues
related to the ethics and sets a core principles related to the ethical conduct. This law
also guides the company on applying the concepts in the constructional site.
 Personal ethics that is bounded with an individual beliefs, personality and values of an
individual’s culture and leadership is also required to be considered by the company
(Friesen et al. 2019). A proper management of ethical practices is required by the
manager for meeting the ethical aspects of the stakeholders.
b.
Pre-Contract Cost Control
Construction of a new building in a different site will require a heavy finance in
various operations. Hence, the client must ensure that, the overall cost for the contract is
within the budget and cost limit. For successful cost control in the contract, decisions
associated with the cost related plan must be regularly checked by the client. The client must
ensure that, the decisions will not adversely affect the other expenditures. A single
disturbance in the value of the decision will affect the budget of the contract. The mentioned
cost control system must enable the manager of the business to clearly observe the current
level for cost and compare them with a standard cost to keep an eye on the cost.
For a successful pre-contract cost control of the new design of building, all the
relevant members should be informed (Cunningham, T., 2017). The architect should confirm
the agreement proposal related to cost plan with Robert, who is a quantity surveyor of the
company. This will form a clarity between the architect and the business. Robert as a quantity

8CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
surveyor must guide the entire design team in alternative savings of the costs. For this, Robert
will have to communicate with the client and all the team members of designing the building.
Robert should update the cost plan regularly to the entire team. Regular update of the cost
plan, the quantify surveyor must check the quality and quantity parameters of the cost plan
and compare with the standard cost mentioned by the company. A wide range of cost may be
possible in an element which is very much necessary to clearly check the cost, before
notifying the cost to the architect for further expenditure. If any excess cost is identified or
measured by the surveyor during cost checking, then the savings should be notified
immediately to the design team and modify or compensate the cost plan.
Robert, as a Quantity Surveyor must maintain a significant record of the entire
checking process by setting an overall view on the value of the costs. A summary of the
comparison of cost plan targets must be systematically recorded. The pre-contract cost
control is very important for a quantity surveyors in providing a better advice to the clients
and designing teams for implementation of the cost in the approved budget. They provide a
realistic cost advice by making cost plans at the various stage of cost designing. The stages
for cost designing includes cost plan at concept stage, design development stage and technical
& production related design at the final stage.
c.
Value and Risk Management
Value related to the transiting of the old office to a new site will include the satisfaction
of the requirements of the staffs and workforce of the company. This includes the sufficient
allocation of resources to the staffs. This will satisfy the workers to appropriately deliver the
operations to the business. Greater the satisfaction of the requirements, more is the value
obtained. Clients of the stakeholders have different values. Hence, a proper value

9CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
management engage the team to effectively achieve the aims by optimum use of the
resources. Therefore, the values can be increased by satisfying the requirements of the staffs
in the new office by minimal use of resources (Paquin, Gauthier and Morin 2016). Efficient
value management can be done by implementing the following steps:
1. Collection of effective information related to the objectives and budget of the new
purpose-building.
2. Adequate availability of the resources and proper analysis of the entire operations for
enabling the staff satisfaction.
3. Identifying the various value opportunities and creating an innovative idea
generations.
4. Evaluation of the idea by ranking the various opportunities according to their
standard.
5. Development of the idea to understand the cost and benefits of the opportunities.
6. Building a final decision to implement the plan.
The most important element required for value satisfaction is risk management. Risk
Management is very much important to monitor and control the cost to prevent the risks
Associated with the business. The most important risk that can be assessed for successful
value management is the identification of residual risks in the new constructional site. This
risks is assessed by identifying the various hazards related to the constructions sites,
measuring the various risks related to the workforce, risks in property damage, risks in loss of
time and production, risks related to sustainability of the future business. The client must
consider these risks for designing and funding the cost to the contractors and architect.
Construction risk is very much risky to handle because it is an inherent risks, hence Robert,
as a quantity surveyor have the immune to support an efficient cost related plans to the

10CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
business. Therefore, Robert must implement a better risks management techniques for
enhancing the business in the new office.
d.
Procurement and BIM/Collaboration
Clients can be procured through Collaborative BIM or Building Information
Modelling. This model involves the prioritizing of BIM assets and developing a process that
can support each assets of BIM. To achieve the standards of BIM, the contracts should be
advanced. The collaboration with BIM have several benefits. Some of the benefits are:
 This allows the information ready at right time without any need of reprocess of the
information (Sanchez, Hampson and Mohamed 2016).
 This model enhances the display technologies and allows the whole redesigning team
to collaborate in the construction projects by reviewing a digital model of the project.
 The technologies and methods used in this model, improves the safety in the
construction site by effective communication across the team, minimising the risk
factors involved in the project and ensures security in the workplace.
 Collaboration with BIM depends totally on team capability. Hence, if there is
effective communication and collaboration among the QS team and the leader, then
the client will be able to finish the project, before the lease period for the existing
building expires (McAuley, Hore and West 2017).
Collaboration with BIM is very important in providing an opportunity to the team
members in adapting to the entire procurement process and help in management support to
complete the project. BIM principles allows the incorporations of soft landings within the
team members. The clients can align their resources and purchasing power in delivering the
best finance savings without affecting the quality in making a new purpose building. In order

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to deliver the outcome within the time limit, this model is supported by a set of clear systems
like two-stage collaborative contract process and integrated collaboration of the QS team to
contribute the required design and generate the benefits without facing any challenges or
problems. The building Information Model will increase the efficiency of the process and
reduce the wastes and carbon consumption. It promotes the best delivery solutions and
integrated design concepts in building constructions. The main benefit of this model is it
keeps a focus on Client’s capability (kinade et al. 2016). It allows the client’s to properly
analyse the model and do a test under 2D process to provide an overall outline of the entire
construction project. Hence, Robert as a quantify surveyor can implement this model among
the team members and optimise the work with desired quality.
e.
Pre-tender Processes and contractor selection
A tender is the supplier of the required materials in response to an invitation by the
company. This is a type of offer given to a supplier by the procurement department. The
purchase department invite a tender for a various range of contracts (Ulubeyli, Kazaz and
Arslan 2017). This includes, construction contact for designing, equipment supply and
enabling the works. Following are the pre-tender process which includes all the activities that
are prior to the tender announcements:
1. Invitation to tenders- Invitation is given to the tenders after the completion of a
qualification response by the clients. The response will allow the clients to prepare a
short-list of the suppliers those are appropriate for the construction project. This step
will minimise the effort of client in the tender process. Invitation to a tender will
include the following information:
 A letter of investment

12CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
 Pre-construction plan
 Amendments and Contract conditions
 Information Requirements for collaboration with BIM or Building Information
Model.
 Tender Pricing Document
 Designing schedule and drawing based on Building Information Model.
 Important specifications.
2. Clarification- This steps involves the various responses and queries raised during the
tender process. It may result in extension of tender period for clarifying the problems.
It also provide opportunities for changing any documents related to the problems.
3. Submission- The invited tenders will submit the tender which consists of various
documents that includes, price of the materials, quantity of the materials along with
the proposals.
4. Variant Bids- Variant bids is submitted by the tenderer if they think that the proposal
will offer a better value for the money.
5. Settlement- In this step, the client identifies the most desirable tender and settle a
meeting for negotiations. This step includes negotiations and further adjustments of
the tender documents. Revised tender is again submitted.
6. Preparation of the final contact- This step includes the signing of final agreed contract
by the clients. It includes a wide range of agreements like construction contracts,
agreements for appointments and many more. This agreement is prepared both for the
client and the suppliers. This will avoid the unwanted errors during preparations of the
contract.
7. Management of the building construction- Robert as the quantity surveyor of the
entire team will perform a consultancy role in making the appointment according the

13CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
consult team. It performs the role in building a collaboration with the QS team for the
vital success of the project.
8. Final selection of the contractor- The final selection of contractor is done on the basis
of following factors:
 Least cost- The contract is only done on the basis of some lump sum price as declared
in the budget (Acheamfour et al. 2019). Contractor for the least price is only selected
for the contract.
 Qualifications- They are chosen on the basis of project team, experience, project
methodology like scheduling & methods, looking into their past projects.
 On the basis of cost and quality- The quality and price of the qualifications are
measured according to their past experiences. Quality is measured on the basis of
technical bid.
 Fixed Budget- The contractor is selected within a fixed budget. This method is rarely
applied, it can go beyond the budget.
f.
Recommendations
Following recommendations should be followed by the clients and the stakeholders:
 The clients or the stakeholders must properly analyse the basic factors that may
impact the project. They must consider the soft landing for smooth transactions of the
construction process. It should properly analyse the site before selecting the site for
construction. This analyse should focus on the quality and risk factors of the site.
Ethical aspects of the construction site and workforce should also be considered
during the process.

14CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
 The client is advised to prioritise the cost control before selecting a contract. This can
be done during the tender selection process (Hijazi et al. 2019). The clients should
regularly check the cost of operation according to the cost budget plan. Robert as the
quantify surveyor must advice the clients in making a realistic cost decisions at
various stage of cost designing’s.
 The new purpose building can be completed within the time limit, if there is entire
collaboration between the QS team members and designing team members associated
with the project. There must be effective transfer of information among the team
members. This can be done by a collaboration with the Building Information
Modelling. Procurement with BIM will allow the incorporation of soft landings within
the team members.
Conclusion
Therefore, it can be deferred that, the entire project can be smoothly completed by
minimising the risk factor and ensuring the building sustainability, through optimum
collaboration within the QS team members and the designing team. Smooth transactions can
be done through soft landings, collaboration with Building Information Modelling, optimum
cost valuation and selection of appropriate contractor.

15CRITICAL APPRAISAL FOR OPTIMUM COMMERCIAL MANAGEMENT
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