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The Lifecycle
03

Handover & Transition

The narrowest seam, and the one that determines the next three decades.

Projects Advisors. Reuse: https://projects-advisors.com/licenceKnowledge held against knowledge needed, across handoverThe party that built the asset holds the knowledge, and its obligation ends at handover. The party that must operate it needs that knowledge from handover onward. The curves cross at exactly the wrong moment.ConstructionOperationKnowledge held by the builderKnowledge the operator needsHandover: the seam
Knowledge leaves at precisely the moment it is first needed. That crossing is the seam.

Handover is treated as a completeness exercise. Documents are indexed, certificates are signed, keys change hands. The 2017 FIDIC forms strengthened what that requires: as-built records, operation and maintenance manuals and training moved out of the contractor’s-documents clauses into Sub-Clause 10.1, making their supply an express condition of taking over, with the Engineer required to issue a Notice of No-objection on the records and the manuals. A Defects Notification Period of one year, unless the contract says otherwise, then begins.

There appears to be a way past it. Victoria Tyson of Howard Kennedy reads the redrafted Sub-Clause 10.3 as allowing deemed taking over, where tests on completion have been interfered with, even without those documents. That is one practitioner’s reading rather than settled law, and it may never be tested. It is worth knowing before relying on the clause.

All of that is necessary and none of it is sufficient. A contract can compel the delivery of documents. It cannot compel the transfer of understanding, and understanding is what operations actually needs.

The gap is rarely anyone’s fault. It is structural: the party that holds the knowledge has no remaining obligation at precisely the moment the party that needs it arrives. Nobody is behaving badly. The incentives simply stop.

The discipline that addresses this has a name: operational readiness. In process industries it is mature and well resourced, because a plant that cannot be run on the day it is finished is obviously a failure. In building, property and civil infrastructure programmes it is applied inconsistently, and when it is applied it usually begins far too late to change what is being produced. Operational readiness run as a commissioning activity is a checklist. Run from inception, it is a specification.

What typically goes wrong

  1. 01

    Everything required is delivered, and nothing needed is transferred.

  2. 02

    As-built information records what was drawn rather than what was installed.

  3. 03

    Late changes are documented commercially but never reflected in the operating record.

  4. 04

    The operating team is assembled after the handover it should have specified.

  5. 05

    Operational readiness is treated as a commissioning task at the end rather than a requirement set at the beginning.

  6. 06

    The Defects Notification Period expires before anyone has operated the asset through a full cycle of conditions.

Questions worth asking

  • ?

    Could a competent stranger operate this asset from the information we have been given?

  • ?

    What did we accept because it was on the list, rather than because it was usable?

  • ?

    Which decisions were made during construction that we cannot now reconstruct?

  • ?

    What will we discover in month eighteen that somebody knew in month six?

The seam that follows

Between handover and operations, the asset stops being a project and becomes a liability with a revenue line attached.

Writing on handover

A delivered file is not an accepted record

A handover contract can test that the information arrived and that the Engineer had no objection to it. That proves receipt. It does not prove that the data passed a schema, that its identifiers reconcile with the finance and maintenance records, or that the receiving system can run a transaction on it. Those are three further tests, and where a contract's information conditions end at delivery and absence of objection, each can fail while those information obligations are performed in full.

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The project crosswalk reaches capitalisation. What survives it?

NASA requires a project work breakdown structure to correlate exactly through seven levels to the financial accounting structure, and EXPRO's cost and commitment procedure reconciles the project cost report to the corporate general ledger on a named form with a named owner. Both requirements are scoped to the project. The Saudi Ministry of Finance's asset manual then has finance allocate the project's cost to assets and components at capitalisation. None of the public documents reviewed here says the project's identifiers stay on the asset record after that.

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Under FIDIC, taking over comes before acceptance

Under FIDIC 2017, taking over and contractual acceptance of the works are separate. At taking over the owner takes possession and may begin operating; Sub-Clause 11.9 makes the Performance Certificate the document that constitutes acceptance, and it follows a Defects Notification Period of one year unless the Contract Data states otherwise. A general law-firm summary lists what can change at practical completion or taking over: the contractor's insurance of the works ends, the risk of loss transfers, exposure to delay damages stops, and, where the contract provides for it, retention and the performance bond can begin to release. Where they do, much of the hold on the contractor loosens just as the owner's exposure begins.

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Every stage, in one index

What to examine at handover

5 domains from the assurance framework belong to this stage. Each names a question with a checkable answer and the published clause that requires it.

The 5 domains in full, with sources

This stage in the method

Asset lifecycle method

Tools for handover

Each runs in your browser, computes from published rules, and prints a sheet that says which. Nothing you enter leaves the page.

Every tool, by stage

Terms this stage relies on

Every definition, in one index