Hiring an Owner’s Representative

Introduction

A construction project can be exhaustive and overwhelming at certain times. Multiple factors will take part in the successful handling of the Project. Project owners are often too busy with multiple projects or other management tasks that they cannot pay the full attention needed for a project. Sometimes the Owner lacks certain skills and resources required to complete the project; therefore, the Owner hires an Owner’s Representative (OR) to act on their behalf and effectively execute the project.

OR is a third party hired by the client/owner to serve the owner throughout the project phases from the bidding stage to the closing and project handover stage so that the Owner’s interests are safeguarded and the project is completed within time and budget. An OR does not manage the project directly but rather performs the monitoring job. Managing the project is the role of a project manager. Complex projects may involve many project managers reporting to the OR. In this case, the OR assigns tasks to each project manager and monitors and streamlines the project’s progress. The key jobs of an OR include but are not limited to the following depending on the requirements of a Project Owner:

• Project Concept phase, including design preparation
• Finalize the overall project budget and timeline
• Bidding phase and hiring the Contractors
• Managing the design in case of a Turnkey project
• Managing the project’s progress and budget
• Analyze the Contractor’s claim and variation/change orders
• Mitigate project’s risks and avail opportunities
• Represent the Owner in Dispute and Arbitration cases, etc
• Closing and handover of the Project to the Project owner

Criteria for Hiring Owner’s Representative

While hiring an owner’s representative (OR), the owner will think of his project requirement to match the skill set of an OR. The OR must have enough skill sets to fulfill the owner’s desire and requirements from a certain project. ORs have to work with contractors, subcontractors, and different stakeholders involved in the Project; therefore, multiple skill sets are required when an OR is hired. The OR should be an industry expert on wherein the specific project is going to be executed. Out of multiple skills these top five skills are considered mandatory for an owner’s representative i.e. Specific industry knowledge, communication, Bid evaluation, Dispute Resolution, and planning.

How OR can be Beneficial

More often it is witnessed that owners have enough finances for the project but lack the required skill sets and time to execute the project properly. OR will make sure that what was promised by the Contractor in the bidding phase will be delivered appropriately to the project owner. While the OR is monitoring all the aspects of the project, he is not replacing the owner. The OR is just relaxing the owner to focus more on critical enterprise matters. The final SAY in the project still belongs to the Owner. The owner/client can be more focused on its business development and company vision than being stuck on a single project. The key benefits of having a professional OR on the project are as follows:

1. Timeline Intact

The major issue in the projects is the delay factor from the Owner’s side. The delay is normally caused by delayed drawings and other project-related approval, site possession, and delays in payments. This issue can be resolved by hiring an efficient OR which can help mitigate these delays.

OR will efficiently manage the Contractor’s schedule baselines and monitor any updates required as per project progress. OR can also analyze the project through the most effective critical path Method (CPM) and keep the project on track. The Project owner can have the progress report and stay informed while performing other essential functions.

2. Budget

An OR will implement proper cost management techniques and formulae and keep the project budget streamlined. By closely monitoring the design phase of the Project, an OR can mitigate the chances of variation/change orders in the project. It has two benefits, firstly, the project’s cost remains the same, and secondly, the project’s timeline remains undisturbed by unprecedented changes in the project.

3. Quality

Quality in the project is another major issue. Not only in construction but from the design phase to the proper handover phase the OR helps manage the quality of the project. By employing the highest standard of the quality management system, the OR will ensure that the project’s daily operations are executed as per the standard industry norms.

Purpose of an Owner’s Representative

The Client does not possess all the expertise required for a specific project all the time, therefore, an expert OR must be hired. In many cases, a dispute arose between the Parties i.e., the Contractor, and the Employer/owner. The specific role of an OR is to act as a neutral party, which shall be agreed upon at the start of hiring an OR. Whenever such conditions appear, the OR must consult both parties to reach an agreement, and if any agreement is not reached then OR must provide a fair determination of the dispute keeping due regard to all the relevant circumstances.

Summary

In conclusion, the project Owner needs an expert to execute whether a small or big project. The experts are well aware of the latest industry trends and new ways to mitigate the risks and are capable of completing the project successfully with respect to finances, timelines, and quality. To learn about the Owner’s Representative services provided by Leopard Project Controls, please refer to our Owner’s Representative page.