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Portfolio Management of Construction Claims

For building industry players who are engaged in multiple construction claims (builders, general contractors, larger trade contractors, suppliers, material and product manufacturers, insurance companies, attorneys) each case can be considered a single battle in a larger war. Deciding how much to spend on each claim – each battle – is hard. How do these expensive decisions get evaluated? Although it should not be guesswork, it often is. PFCS has created a structured process for making these complicated, difficult, strategically important, return-on-investment (ROI) decisions.

PFCS will show you a method for managing your portfolio of construction claims, helping you develop a process for evaluating the costs of various scenarios in construction claim handling. At any point in any case, whether you’ve spent $1.00 or $3 million, you can ask and answer, or at least estimate, these key questions: How much has been spent so far? How much will it cost to get out now? What is a small fight worth? A big fight? What might trial costs look like, and is it worth the risk? As anyone familiar with litigation knows, each of these questions is likely to have best-likely-worst case answers.

The cheapest option is sometimes to get out of the case early, after only the most preliminary analysis. But claims run the gamut, so sometimes a long, expensive fight is the cheapest, best solution, especially if a good outcome will influence other cases.

Key System Components

  1. Claims Management Plan: Brief strategy and tactical document including written objective, executive summary, litigation budget, written agreements with attorney and other vendors, a timeline, and a Claims Plan Manager job description.
  2. Company Level Analysis: Worksheet that is a master list of all cases with best-likely-worst case scenario figures and a strategy summary for each. This includes a summary of all the individual Project Level Analysis worksheets.
  3. Project Level Analysis: Worksheets for each case including best-likely-worst case figures for Attorneys, Experts, Other and Settlement/Judgment costs at various levels of litigation including immediate settlement, a small fight, a big fight and through trial. This includes a summary of the Vendor Scope-Budget Matrix worksheets, plus a settlement hypothesis.
  4. Vendor Scope-Budget Matrix: This is an individual budget from each vendor on each project broken down to conform with the Project Level and Company Level Analysis worksheets.
  5. Meeting Agenda / Minutes: Structure for preparing for, reviewing and updating the analysis periodically.

PFCS will soon host a conversation about portfolio management where your experience, concerns and general feedback will be welcomed. Stay tuned.

If you would like a sample proposal with supporting documents call us or email Pete Fowler at pf@petefowler.com.