• Disruption is a common heading found within most contractor’s loss and expense claims but contractors typically find it one of the hardest to substantiate.
• It’s often so poorly presented that it’s just used as a final negotiating item, largely or completely ‘given away’ in the process of reaching a final settlement agreement.
• When dealt with during formal dispute resolution it’s not unusual to fail to get past the basic tests of establishing cause and effect.
• Yet disruption and productivity losses are very real – so why do contractor’s find it so hard to properly demonstrate them?
• On the (rather big!) assumption that a contractor has established a justifiable cause, ie an event for which he is not contractually responsible, how does he then go about measuring the disruption?
• What records need to be kept and when?
• Even where contractors have so called ‘good contemporary records’, they are often almost exclusively records relating to the activities after the event has impacted, ie in their ‘disrupted’ state.
• To measure a productivity gap it’s quite clear that you need reliable data relating to both the ‘as planned’ activity as well as the ‘as occurred’ or disrupted activity, otherwise there is simply no reliable reference point from which to measure.
• All too often however for the ‘as planned’ activity, the contractor relies on trying to back fit tender price data into a tender programme which is unreliable and insufficiently detailed. They invariably do not align and the exercise becomes hypothetical and largely futile.

So why is it that contractors mostly fail to keep sufficient contemporary records to demonstrate productivity of activities which are unaffected by disrupting events?

Has the MEASURED MILE approach become a forgotten art?

 

Answers on a post card?

Or select one, several or all from below or feel free to add your own !

 

1. Arrogant & mis-guided? - “It doesn’t matter because our tenders are 100% accurate, fully detailed and with fully aligning and resourced tender programmes”
2. Naïve & mis-guided? - “Where there is a justifiable cause then we are entitled to the difference between our cost and the tender price”
3. Struggling & mis-guided? - “We don’t have enough resource to do that”
4. Worried & mis-guided? - “We don’t want to draw attention to any activities where we are making a profit”
5. Lazy & mis-guided? – “It’s a waste of time, we can’t be bothered to do all that”
6. Hopeless & mis-guided? - “We don’t even know what causes our lost productivity let alone how to measure it”
7. In denial & mis-guided? - “We don’t suffer any productivity losses so never claim any”