RICS New Rules of Measurement Best practice

Getting the best from your practice

Barry Harper considers what best practice means and offers some tips for aligning your current cost planning procedures with those embedded in the New Rules of Measurement
he RICS New Rules of Measurement: Order of cost estimating and elemental cost planning (NRM) was made official RICS guidance on 1 May 2009 and is now viewed as best practice by the Institution. But what is best practice and has the status given to the NRM created a hostage to fortune situation? Best practice is a term used in many contexts across different industries and professions. At the lowest common denominator, it simply means the best way to do something or a superior technique more effective at delivering a desired outcome (from Wikipedia). In a professional services firm, practice means all activity and procedures that precede the provision of professional advice to a client. Best practice is therefore the best way or technique of carrying out these activities and through the completion of various recorded procedures. RICS defines best practice as Procedures, which, in the opinion of RICS, meet a high standard of professional competence. Firms that embrace best practice principles will often describe their methodology for capturing and codifying dynamic professional practice as a best practice system. They will also often purport that services provided to clients are best practice. The key business benefit from pursuing a best practice strategy is its pay-back through client satisfaction, repeat work, etc. Being recognised for best practice can also provide access to markets you would otherwise be barred from. There are many other practice benefits and some of these are described in Table 1.

The publication of the NRM guidance is a good example of RICS facilitating the creation of knowledge valuable to all members

One of RICS key roles is to respond to the needs of its members by facilitating the recording of widely accepted standards and procedures for key elements of their professional services. Also, it should promote engagement with these standards and procedures as a way of assuring that members services are perceived by clients as being of a high quality. Recording service procedures is a challenge to complete both effectively and consistently. Setting out the best practice procedures in the NRM will have taken significant resource by all who contributed to the guidance. The publication of the NRM guidance is therefore a good example of RICS rising to this challenge and facilitating the creation of knowledge valuable to all members. The guide will be of particular value if you do not possess the dedicated resources required to establish your own best practice tools. The process of developing this type of guidance also helps in establishing appropriate competence levels required for professional practice and is therefore important for guiding university curricula. For this reason, we should support RICS in building on this success and consider some of the related cost planning procedures outside the scope of the guide, such as measurement techniques. Basic requirements for recording best practice Many established firms will have invested significant resources over time recording practice procedures that are often contained in a Practice Manual (commonly, those big folders that get put on the shelf and referred to only when a new member of staff joins the team). But, what are the real tests of best practice? Here are a few suggestions: guidance should be accessible, usable (particularly under situations of pressure) and in a form that is easy to maintain and update practice procedures embedded in written guidance must be widely accepted and repeatable and, when applied consistently, contribute to an assured outcome that will lead to satisfied clients procedures should be flexible enough to be adapted to actual circumstances with the use of professional judgement guidance should include clear statements on mandatory standards and be based on current practice. With 310 pages of guidance, you may be forgiven for believing that the NRM falls down at the first (best practice) fence of accessibility and usability. However, the separate rules for order of cost estimating and elemental cost planning (sections 2 and 3) together with the extensive tabulated rules of measurement (section 4) makes both reference and use practical

Benefit of best practice Enhanced professional reputation

Description Embracing best practice can help develop a professional reputation at both individual and corporate level. Common pitfalls can be highlighted and avoided Clear procedures should minimise unproductive reworking and the opportunity for misunderstandings Work can be easily transferred between individuals and offices if common procedures are available Following established procedures creates increased confidence in outcomes and provides more time to focus on delivery Opportunities for innovation are increased through repetition and consistency of procedures

Efficiency Consistency Assurance

Innovation

Table 1 Benefits of best practice

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RICS New Rules of Measurement Best practice

Best practice metric Describes current practice Contains widely accepted procedures Procedures offer clarity of action required

NRM evidence Includes new elements of modern construction Prepared by panel of industry experts The measurement rules (section 3) include clear procedures for addressing costs, other than the direct building costs, which is an area that often leads to misunderstandings Lists of key information required to enable preparation of cost plans at various design stages

Assessment

### ### ###

Accessibility

Available to all members but accessibility could be improved through the use of appropriate technology and systems Codification used improves accessibility and offers opportunity for systemisation through the use of information technology

##

Usability

Many of the measurement rules (section 3.10 to 3.21) are likely to be a statement of existing standards already employed in practice. However, these could be made more usable to practitioners if recommended procedures were differentiated from general guidance The inherent structure of the rules means that easy reference to specific elements of measurement should become achievable even under conditions of work pressure The cost planning framework also offers a robust foundation from which to build a valuable historical cost database. This is an important input to securing Best Practice in cost planning, without which you are unlikely to deliver the sustainable benefits available when targeting high-quality measurement

##

Flexibility

New elemental framework promotes consistency while allowing sufficient flexibility for individual client needs and is adaptable for use with work packages for procurement and cost management during the construction phase You will need to benchmark your current measurement procedure against the rules in the first instances of application. The rules (procedures) are then likely to become second nature and require only occasional reference Coverage statements (i.e. the included/excluded notes) should be viewed as useful pricing checklists and valuable when reviewing the activity of support staff

###

Repeatable

###

Aimed at assuring outcomes

###

Table 2 NRM best practice assessment

when carrying out key cost planning tasks. Also, when you begin to understand the purpose of each section (i.e. measurement rules (section 2 and 3) focusing on procedures to evaluate general and non-measurable items, and the tabulated rules of measurement being offered as a logical framework and point of reference tool) the tag of best practice begins to crystallise. Table 2 helps support this analysis. The broad assessment in Table 2 identifies the areas of accessibility and usability as areas where the NRM could better support its best practice tag. However, these areas are probably better left for enhancement through individual business systems. The real issue for many of us is how best to engage with the new guidance, particularly when many are busy trying to steady the ship through a credit crunch. Here are a few tips that may help you develop your own response: firstly, check how you currently appraise general non-measured items in a cost plan. If you do not have recorded cost planning procedures in place, then section 3 of the NRM will be of significant benefit in establishing these procedures

consider the structure of the new cost planning framework (section 4). There are likely to be some differences from current practice, particularly at levels 3 and 4 where standard components are offered for use. This may not currently form part of your current approach, but moving towards the use of consistent components brings the opportunity for increased consistency, particularly when you are working across large and diverse teams. It also brings the opportunity to develop a valuable historic cost database have a respected measurement expert identify any particular elements of the tabulated measurement rules for components (section 4) that diverge from current practice and draw these to the attention of your practitioners create a new cost plan template using the group element, element and sub-element items (level 1 to 3) and encourage practitioners to adapt their current measurement process to suit this new framework (see Table 3, overleaf) consider a managed/phased approach to changing current practice aimed at harmonisation with the

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RICS New Rules of Measurement Best practice

NRM guidance. Focus on securing early opportunities for application of the measurement rules and rules of measurement, capturing lessons learnt for wider dissemination see that copies of tabulated rules (section 4) are readily available for reference on the desk of your cost planners. Also, consider ways that the measurement rules (section 3) can be made available online (subject to copyright, of course) to people undertaking cost plans and as part of their normal workflow consider ways in which the coverage statements for components can be made accessible as checklists. This will be particularly useful when checking the quality and comprehensiveness of a complete element prepare a brief statement for use when clients enquire as to whether your cost planning is compliant with the NRM.

1
1.1 1.1.1 1.1.2 1.1.3 1.2 1.2.1 1.3 1.3.1 1.3.2 1.4 1.4.1

Substructure

Foundations Standard foundations Piled foundations Underpinning Basement excavation Basement excavation Basement retaining walls Basement retaining walls Embedded basement retaining walls Ground floor construction Ground floor slab/bed and suspended floor construction

new cost plan

2
2.1 2.1.1 2.1.2 2.1.3 2.1.4 2.1.5 2.1.6 2.2 2.2.1 2.2.2 2.2.3 2.2.4 2.2.5 2.2.6

Superstructure
Frame Steel frames Space frames/decks Concrete casings to steel frames Concrete frames Timber frames Specialist frames Upper floors Concrete floors Precast/composite decking systems Timber floors Structural screeds Balconies Drainage to balconies

The NRM may, at first, appear overly detailed. However, when cost planners are able to reflect on how the guidance is structured and how each section can meaningfully be applied, it will soon become a respected best practice tool, supporting day-to-day cost planning activity. Reaching best practice in cost planning does not mean being a slave to every word of the NRM guidance from day one. However, and if necessary in order to avoid being held hostage to fortune, be prepared to quickly clarify the purpose and status of the NRM to your clients, together with the procedures currently employed, to assure quality outputs from your cost planning activities. Clients should be reassured that there are now institutional standards aimed at developing consistency and clarity across cost planning services. It also shows that you are actively moving towards harmonisation with these standards. The NRM is an overdue statement of how cost planning practice is widely applied in the UK and a giant step forward for professional practice. Firstly, it makes it that easier to benchmark your cost planning procedures against those which are widely accepted as best practice and secondly it re-establishes measurement as the focus of our professional standing. It also provides our learning establishments with a much clearer statement of the cost planning competencies required by students. More support is required in helping members understand how to move towards exploiting the best practice embedded in the NRM. Like any other business change, moving towards best practice needs to be managed systematically. Exploiting the use of existing technology and practice systems, and allowing the relevant elements of the information to be at practitioners finger tips when most needed, will greatly facilitate this change. Best practice is, by its nature, dynamic and often incrementally developed. The contents of the

Table 3 Extract from new cost plan template using NRM framework

The NRM is an overdue statement of how cost planning practice is widely applied in the UK and a giant step forward for professional practice
guidance should therefore be continually reviewed and challenged if it is to maintain its currency. However, anything aimed at improving consistency in UK practice will be a selling point when working in other regions, helping to avoid the misunderstandings that often arise due to different regional approaches. My advice is therefore to think seriously about exploiting this valued investment and the benefits available on an individual, firm and institution basis will follow. Set out an action plan now and hopefully you will be encouraged by this major contribution to professional practice.

Barry Harper is a Partner and Head of Best Practice with Davis Langdon barry.harper@davislangdon.com

Related competencies include: T022

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Construction project durations

How long will it take to build?

The construction industry has plenty of information advising clients on how much proposed schemes might cost but, until now, there has been little information on how long a construction project may take. However, advice for an early stage of a project is now available with the launch of a new web-based Construction Duration Calculator from BCIS. This will give a quick but robust estimate of timescales based on basic project information. Using actual construction durations from over 4,500 UK new build and refurbishment projects, BCIS has developed sophisticated models to predict the most likely time that work on a particular type of building could take. Calculations are based on eight separate details relating to the project, including: the type of work (either new build or refurbishment) contract value date of project location procurement route selection of contractor client type building function. RICS members are eligible for a discounted subscription rate based on the size of their practice, starting from just 50+VAT per year for a sole practitioner. For a free, 15-minute demonstration of the duration calculator, email contactbcis@bcis.co.uk According to the latest construction industry Key Performance Indicators, 48% of projects do not finish on time, said Joe Martin, Executive Director of BCIS. We regularly hear that building projects have overrun and in some respects we come to expect this, but more often than not an unrealistic timeframe has been proposed at the outset. The calculators strength is in the data used to make the estimates, he added. With real timescales from so many varying projects, it will be far easier to come up with a reasonable assessment at the start of any project. The added bonus is that it is an online service and so data will be updated and expanded on a regular basis.

For further details, visit www.bcis.co.uk/construction_duration_calculator

Related competencies include: T022, T063

Journals archive

An archive of excellence
Looking for a previous edition of the Construction Journal? Heres how to find it
Electronic versions of the Construction Journal, dating back to the first edition in April 2006, are available in pdf format on www.rics.org In addition to regular articles on contracts, cost management, procurement, IT and technology, project management, best practice, relevant law and regulations, business matters, etc themes for previous editions include: Soft skills April/May 2009 Managing in a downturn February/March 2009 Cost control November/December 2008 Regulations September/October 2008 Contract administration June/July 2008 Project management April/May 2008 Skills February/March 2008 Dispute resolution November/December 2007 International focus September/October 2007 Future of procurement June/July 2007 PFI April/May 2007 The client February/March 2007 Payments November/December 2006 The Construction Journal pages also contain details of the 2008 readership survey results, and editorial and advertising contacts. Electronic copies of all other RICS technical journals The Arts Surveyor, Building Conservation, Building Control, Building Surveying, Commercial Property, Geomatics World, Land and Residential Property are also available and can be downloaded free of charge.

Previous editions of the Construction Journal, and all other technical journals, can be found on www.rics.org/journals

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