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A Brief Discussion on Construction Organization Design and Project Budgeting and Settlement

2008-01-11View Original

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  The construction organization design is a necessary document for carrying out infrastructure projects and guiding building construction. It serves as an important tool for construction companies to achieve high quality, efficiency, low costs, and reduced consumption, while also enhancing management and improving economic performance. It is furthermore a crucial measure for properly addressing various contradictions that arise during construction, such as those related to people and materials, time and space, quality and quantity, processes and equipment, specialized tasks and collaboration, supply and consumption, as well as production and management. It enables construction activities to be organized in a rational, scientific, planned, orderly, thorough, and balanced manner. Under normal circumstances, a construction organization design can generally be divided into a general construction organization plan ; Construction organization design for unit projects ; Design for sub-division or sub-project operations.   With the establishment of a socialist market economy, competition in the construction industry has become increasingly fierce. The objective circumstances place higher demands on construction companies; not only are there higher requirements in terms of technical equipment, personnel qualifications, and construction organization, but there are also new challenges in project economic management, particularly regarding project budgeting and settlement. Under the new circumstances, some construction companies lack proactive measures to address these issues; their level of technological management is outdated, and they do not pay sufficient attention to construction organization plans. As a result, the following problems arise: first, there is no construction organization plan at all – no layout plans are prepared, materials are piled up in disorder, there is no planning regarding the transportation of soil, and there is no plan for the use of machinery and labor. Measures to ensure project quality and proper construction methods are also lacking, leading to serious delays and waste, as well as a low level of management ; Secondly, it’s for superficial compliance: when Party A and Party B sign a contract for project construction, in order to meet Party A’s requirement to review the construction plan, one has to fabricate such a plan hastily just to get by ; Third, the quality of construction organization design is poor: many construction companies do not understand the requirements for construction organization measures; they simply draw a layout plan or a project schedule and consider that this constitutes a construction organization design ; Fourth, an emphasis on technology at the expense of economics: Some construction firms, influenced by traditional concepts and established practices, focus only on the technical measures related to construction organization, ignoring economic aspects, which leads to continuous disputes during project settlement.   For example, in the project to upgrade the water supply and drainage infrastructure in the Suliming Building in the old port area of Yingkou Port, since the building has been around for two or three decades, residents have built storage rooms between the floors, occupying public space and resulting in overly narrow passageways that make it difficult to move around. Under such conditions, it is necessary to transport construction materials by hand, and the construction company claims additional fees for the second round of transportation due to the materials not yet arriving at the site. If the construction party conducts a site inspection before starting work, carefully prepares a construction plan, and specifies it in the project contract, many troubles can be avoided.   Another example is the excavation of foundation pits for a multi-purpose building project. The construction site was not spacious, and the contractor did not have a construction organization plan nor a soil investigation plan; furthermore, no calculation was made regarding the capacity for storing soil. As a result, some of the soil had to be removed by truck since it could not be stored there, which led to disputes during the settlement process. In the end, this was not recognized, causing financial losses to the contractor.   The above examples show that the construction organization design plays an important role throughout the entire construction process as well as in the budgeting and settlement of projects. It is not merely meant for organizing construction and guiding production; objectively, it has become a very important component that cannot be ignored in economic management work.   Budget quotas are an important part of construction cost management; they serve as the basis for preparing construction drawings budgets in building projects, determining project costs, settling progress payments, and finalizing accounts upon completion. The diversity of construction project types leads to a variety of construction methods. Budget quotas possess the characteristics of \"general applicability overall and individual independence.\" Although they provide some guidance based on the economic variations that occur in the construction of general industrial and civil buildings, they still cannot cover the variability of construction methods or the specific requirements of particular projects. Therefore, being familiar with and mastering budget quotas is a prerequisite for preparing effective construction organization plans. It is thus necessary to understand the methods used in budget quotas ; Rules for calculating engineering quantities ; Master the projects in the budget quota that are subject to conditional implementation restrictions. In the budget quotas, some items are clearly specified but come with certain conditions; for example, regarding the secondary transportation of materials and the transportation of prefabricated components, the quotas generally require that these tasks be carried out directly from the storage location to the installation site, without any secondary transportation. If secondary transportation is indeed necessary due to limited construction space or topographical constraints, this must be specified in the construction organization plan and approved by the supervisor and the project owner.   With the establishment of a socialist market economy and the diversification of investments, managers’ mindsets have undergone significant changes. To meet the demands of market economic development, the authorities in charge of project construction have actively reformed the criteria used for pricing ; The construction entity practices careful budgeting in order to make rational use of the construction funds ; Under the new circumstances, economic managers are paying unprecedentedly high attention to budget quotas, which in the past were not given much importance by construction firms as a basis for pricing. Therefore, paying attention to and improving the content of construction organization design is not only related to the economic interests of the collective and individuals, but it is also an objective requirement for strengthening economic management and determining the cost of individual projects reasonably.   The construction organization design is not only an important document to guide production and operational activities but also a crucial basis for preparing the construction drawing budget. Therefore, before the commencement of a construction project, the project leader must organize personnel in charge of engineering technology, materials and equipment, labor quotas, economic planning, and project cost to carefully study the drawings, conduct on-site inspections, and examine various technical, economic, and organizational measures. The involvement of cost engineers in the preparation of construction organization plans is directly related to the economic interests of the enterprise, as they serve as advisors to the business managers in cost management and the implementation of budgetary regulations ; In bidding and construction contract agreements, cost professionals, entrusted by the corporate entity, can act as authorized representatives of the entity’s legal representative and exercise the powers granted to them by the corporate entity ; It plays a role in economic supervision in construction and budgeting work. Therefore, fully leveraging the expertise of cost engineers, who understand technology, policies, and laws, within a company is an important aspect for developing effective construction organization plans and improving the company’s economic efficiency. It is also a reasonable and effective way to overcome and avoid financial disputes in project settlements.

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