This article is part of the Delay Analysis 101 series, which is also available as a LinkedIn newsletter.
In a recent article we explained why opposing construction delay experts may disagree on the critical path. One of the main reasons for this disagreement was the choice of the temporal perspective: prospective, retrospective, or contemporaneous. We also learned that a delay to any critical activity is directly related to delaying the project completion date.
But, how do we measure delay? Through this article we will explore the two delay measurement methods widely recognised by the industry.
The Delay Analysis 101 series
This article is the first of a series of essays which aim to introduce key delay analysis concepts and techniques to non-specialist individuals such as lawyers, in-house counsels, schedulers, contract managers or project directors.
The contents of this series purposely remain at a high level. The Orizo Team is currently working on our Cutting-Edge series, which will target a more specialized audience by addressing delay analysis subjects with greater depths. Follow us to get notified!
Prospective delay – As-Planned
Prospective delay, also often referred to as as-planned delay, relates to a forecast. Measuring the as-planned delay of an activity or project typically means assessing by how much it is expected to be delayed, according to the present knowledge.
As-planned delay is hypothetical; it communicates a subjective expectation, which may vary depending on the choice of a set of assumptions. In the events, as-planned delays are rarely correct, for the simple reason that no one can precisely predict the future, in particular when assessing complex systems such as capital infrastructure or energy projects.
Whilst hypothetical, this type of delay can nonetheless be very useful. When negotiating between the parties just after the triggering of an unexpected event, as-planned delay provides visibility, allows to take decision and to reach agreements between the project stakeholders so that mitigation measures can be undertaken at the first opportunity.
Theoretical example – An activity is contractually due to complete by 17 March. As at 15 March, it is forecast to be completed by 22 March. The as-planned delay is 5 days, which is illustrated in the figure below.
Practical example – A project is affected by physical damages caused by an exceptionally strong storm. Under such scenario, there is a clear advantage in assessing the as-planned delays which will likely occur as a result of the necessity to undertake repairs: (i) the contractor is able to take strategic decisions such as prioritizing or re-sequencing parts of the works, and (ii) the employer is able to grant a reasonable extension of time or perhaps activate founds for an acceleration plan. Prospective delays enable the parties to collaborate effectively and intend to minimize the impact of the storm.
Prospective delay is one of the most important project management tools. It allows to proactively assess the impact of delay events and to react accordingly, rather than inactively suffer the real effects before adopting concrete measures.
Retrospective delay – As-Built
Retrospective delay, also often referred to as as-built delay, relates to a tangible fact. Measuring the as-built delay of an activity or project typically means establishing how its undertaking compared with the original plan. Often, this plan is the contractual schedule, also known as the baseline programme: as-built delay is then an assessment of actual contractual delays.
As-built delay is factual; it quantifies a deviation with full objectivity. Once an activity is completed, its as-built delay does not change.
Measuring deviations allows to refine project forecasts, which is the foundation of updating the contemporaneous critical path, and thus managing a project effectively. It also allows to assess the actual impact of a delay event.
Theoretical example – As at 15 March, an activity has achieved 50% of actual progress. It was contractually due to achieve 50% by 3 March. The as-built delay is 12 days, which is illustrated in the figure below. Note how this differs from the 5 days of as-planned delays measured earlier: this is because the schedule anticipates that the delays will be recovered in the future, but will this happen for sure?
Practical example – Referring back to the exceptionally strong storm mentioned above, assessing the as-built delay means determining the real impact of the storm, which can only be calculated after the facts. If the section of the damaged works had an as-built delay of 52 days just before the storm, and an as-built delay of 73 days once the repairs were completed, one may conclude that the storm caused 73 – 52 = 21 days of as-built delay. Of course, this assumes no other event delayed the works during the period of the repairs.
Once the actual impact of an event has been measured, one may then wish to quantify the damage related to this event, for example by factoring the as-built delay with the average daily overhead costs during the period (site facilities, management staff, etc).
Retrospective delay is at the heart of quantifying damages. It allows to connect real financial losses with the events which actively caused them.
In a subsequent article, we will see how these delay measurements integrate with various types of critical paths.
