New procedures and materials create advantages to architects, designers, and constructor and property owners consequently change mean the price tag on building was lower and occasionally home building assignments could actually be completed faster. However as with new procedures and materials emerge, new training is required to fully utilise them allowing engineering projects to gain added value. Along with the new ability of clients being able to access information regarding to new materials and functions, the capabilities for clients to designate particular materials and techniques to be designed in the design and development of the building rises. As opposed to an architect or custom recommending a suitable process or product to be used (Combination, 2001). The increased knowledge bought by the client regarding to the kind of construction materials and functions available enhances the client's vision about the structure project and finally this changes their goals. The changes in client's expectation in engineering assignments must be properly been able in order for tasks to be completed efficiently.
The goal of this report is to demonstrate how value management and risk management can be employed to manage the expectation of clients in building projects.
During the late 1990s to the early 2000s a considerable number of residences were built-in New Zealand using methods and materials that cannot withstand the current weather conditions of New Zealand. The calamity led to a blend of contributing factors involving the design of the building, the installation of materials, the change in need in untreated timber used in construction, the upsurge in insulations installed in timber framing and the development to make Mediterranean styled building using monolithic cladding systems. The challenge with such building is the fact that once drinking water or dampness penetrates through certain cladding systems, if there are no cavities between your cladding and the platform, this becomes stuck and cannot easily avoid or evaporate.
In addition an alteration in the brand new Zealand Specifications for timber treatment in 1998 allowed the utilization of untreated kiln-dried timber to be used in wall framing. When this untreated timber comes in contact with water for a long period of your time, the timber will commence to rot.
In 2002 the Building Industry Specialist appointed a Weathertightness Analysis Group to research the reason for the leaky homes turmoil in New Zealand. Within their findings they pointed out the main factors that contributed to the cause of the leaky homes but no one factor was identified as the solo cause of leaky properties (Department of Building and Real estate and Consumer NZ).
The trend to construct Mediterranean styled properties using monolithic cladding systems
Flat roofs with small or no eaves
Two or even more stories
Solid balustrades and balconies that just extend right out of the walls which in turn causes penetration through the external claddings
Insufficient details in the approved documents, that happen to be produced to help people meet the requirements of the New Zealand Building Code.
Lacking of specialized knowledge and skills when properties are designed, complete and built. Modern systems require much larger level of information, health care and skill.
Untreated kiln-dried timber is susceptible to rot when drinking water penetrates the building envelop.
The leaky home crisis is a organized failure of a new building style development, poor design features, inadequate building requirements, and having less technical knowledge to design, detail and develop buildings.
The media in place had an affect on the design of cover that was not used to New Zealand's traditional designed houses. Additionally it is during this time period when manufacturers of building materials begun to market their products right to the consumers; the finish users and owners of complexes (Mix, 2001). Companies including the Winstone Wallboards Ltd started out to market their products to the general public; their advertisings of gypsum plasterboard by-passed the construction industry and right to the owner. Similarly the producers of Red Batts, Tasman Insulation New Zealand Small also commenced major marketing promotions to target homeowner and potential home owners to incorporate their building products in the development of houses. Having less execution to ensure sufficient and safe designs while builders and companies lacked knowledge regarding to the building product and its own application might well have contributed to the leaky building turmoil.
Although this changing in structure product marketing was not a reason behind the leaky home turmoil, it nevertheless have increased the knowing of building products for clients and this increased their potential and persistence to identify particular building products or processes, therefore changing the expectation of the outcome of the structure project.
Client's expectation of engineering projects have transformed over time in parallel with the changes in technology, especially in the improvements in information systems and marketing promotions for structure materials. Nowadays manufacturers of building products advertise and market their products directly to the potential clients of construction jobs. Good examples of them can be seen on the television set mass media, manufacturers such as Winstone Wallboards Ltd market their gypsum plasterboard for surfaces and ceilings, while Tasman Insulation New Zealand Limited market their insulation products additionally known as Pink Batts. This new marketing strategy from construction material manufacturers means that they have effectively by-passed the circulation companies and the building and engineering industries in the value string for the way to obtain building materials (Mix, 2001).
Figure 1: Value chain for building and structure related market sectors (Cross, 2001)
This marketing strategy allowed consumers who will be the potential clients of construction projects to have significantly more knowledge of the building products available and become aware of the actual advantages of particular building products. With the internet, manufacturers can send out product information and standards online. Before these changes in marketing and internet resources, development products were chosen and presents to the client by the job team. Compare to now, clients have products in mind before initiating a structure project. There is also at heart the advertised visual appearance and performance of the products giving clients a standard expectation of the development prior to the meeting with the look team (Wilkinson & Scofield, 2003).
Construction clients are committing something they cannot see until it is completed. The challenge for the project team is translating consumer needs into design requirements and succeeding critical characteristics. Failing woefully to understand client needs is the problem that creates the largest gap between consumer expectation and client satisfaction. The second largest gap is held by job delivery being promptly. The new online marketing strategy could potentially create a gap between client expectation and customer care as the visual looks and performance of the merchandise can only be achieve if it was installed in a specific way for under certain circumstances (Atkin, Borgbrant, & Josephson, 2003). Such gaps may potentially become details of issue throughout the engineering project and lastly reaching the conclusion and the client's expectation on the task may not be performed.
If clients are educated by the design team in regards to what to expect during the design and building of the job and the criteria a design team must offer, then trivial divergence may then be view as part of the design process and the attempts could be directed toward resolving those tedious problems understandingly and effectively (ACEC Oregon, 2008). Clients who are not really acquainted with the tests and adversity of a significant task should be informed on the procedure before the design and engineering stages. Doing so will aid the clarification of client's expectation and invite clients to change their expectation to a realistic level.
Clients have four main prospects on construction assignments. They will be the expectation on scope, cost, time and quality. All of these expectations are defined, estimated, planned and specified during the design stage of the job. Hence, it is crucial for the job team to identify the client's objectives at the start of the design phase such that it could work into the client's expectations. Once the construction period of the project starts, there would be little room for modifications on the emphasis of meeting consumer expectation. By that level the task team are adhering, monitoring, handling and handling the expectations which were set during the design phase.
Figure 2: General client task expectation (Oyegoke, 2006)
Client's preconceived objectives on construction jobs are highly skewed by the marketing strategies employed by manufacturers. Manufacturers often advertise their product's performance under optimum conditions plus they tend to omit hazards that are associated with the product. That is the main contributor to client's anticipations as they have a visualisation of how the product performs however in some cases, the products may not be able to perform at their optimum level because of the environment of the task location, the unit installation, program and the maintenance of the product.
Client's targets over the price tag on projects have changed as time passes. Clients expect costs to be placed at the very least, however most clients don't realize the so called costs that get excited about a construction job and the overall very existence time cost of complexes. The movements towards 'green' complexes are a good example, the aim of sustainable structures, the so called 'inexperienced' buildings are to lessen the impact of the building's operation on the surroundings which in series usually reduces the intake of energy of structures. Sometimes clients are too focus on the capital cost, that they fail to recognise the benefits of the reducing the whole life cost of the building through the small upsurge in capital expenditure.
Time is another important expectation from customers; sometimes the main expectation. The thought of prefabrication allows construction a chance to be reduced, as components are made off-site and are taken to the building site for assembly. However there is a limit concerning how many components of the construction can be prefabricated and the development to more technical projects which takes a finer degree of design detail and so contributing to the distance of engineering time.
A commercial consumer, would built office buildings to market or rent to others and it is expecting a primary financial gain
A industrial customer would build factories and expect an increase on productivity
A public consumer is wanting a interpersonal investment gain from a fresh school.
When the client is satisfied that there surely is a need for a project, it'll then take on a feasibility analysis to ascertain if the project meets every one of the objectives of your client (Lavender, 1996).
The most important feature of any building project should be the client's objective in getting into the structure of the project. The necessity for the project will as a rule have increased from some demand arising from your client organisation's main activities as explained before. The needs of clients are activated by the environment of their organisation, which presents opportunities to that they respond. Such external stimulus may be economic forces, which give the opportunity for earnings, or sociological makes, which presents the chance to react to a communal need, but usually they are simply a blend of different causes in which the client must react to as the result of the necessity to make it through. Above this, clients also act in response in order to expand consequently of drive and inspiration.
The effect of causes in the client's environment will therefore cause the start of the structure process. Although it may well not be realised at the time that a task is needed and at that level it is unlikely that any customers of the job team will be engaged. When it becomes clear that a construction project is required to meet the client's targets, the brief begins to form. The major problem is that the job team will normally not be involved at this early on stage and a number of important decisions which might inappropriately constrain the look of the project might have been made by the time they are brought in (Walker A. , 2002).
Figure 3: Triangle of energy, cost and quality (Lavender, 1996)
Once the goals are attained, the three qualities of a job must then be prioritized to demonstrate the client's preference. For some clients, if the goal is to keep costs down, then a delay may not subject too much. However to other clients, time may be a complete main concern - for example a hotel development is slated for conclusion to meet seasonal increase in trade (Lavender, 1996). These three qualities in turn signify the client's expectation of the result of the project, it is therefore vital to talk to the clients to find how the client has prioritised these features.
Clients often perceive the simple as a reasonably detailed affirmation of what they require, but it is important that the tactical degree of the quick is not forgotten at the expense of detail. The client's priorities must be clearly set up and are communicated to the project team. It may well be that there is conflict within the client's company regarding priorities, however the job team must be self-assured so it has interpreted the total amount properly. To do this it will have to comprehend the client's organisation, its decision-making process and where in fact the highest authority lays (Walker A. , 2002).
New pattern in property ownership
Increase in range of investment properties (time expectation)
Growing task complexity
Due to raised need requirements and technological advancements in material standardisation, engineering methods, techniques and technologies. (quality and cost expectation)
Influence of life cycle costing
Cost of maintenance and maintenance
Influence of alternative materials and systems
Shrinking business and job cycles
Shortening of the hypothetical supply chain of creating materials (cost and quality expectation)
Commoditisation of products and services
Specific products and trade specialist as an initial tier contractor
External stakeholder power
Clients knowledge bottom is expanding
Scarce human being resources
Green buildings (to reduce energy ingestion and effects of global warming)
Time is a finite source, especially with the new style of raises in amounts of investment properties, clients of engineering tasks demand their jobs to be completed on time for maximum market trading. This in place translates to the increasing expectation for structure assignments to be completed on time and approach to fast traffic monitoring will be employed to ensure deadlines are achieved. Communication requirements in intricate projects are frustrating in comparison to more traditional assignments and there is a requirement for a great deal of interaction and negotiation (Kelly & Man, 1993). The increase complexness will add a chance to the project duration.
Client Expectation and Task Management
The general classification of construction project management is said to be the look, co-ordination and control of a task from conception to completion on behalf of a client. This involves the recognition of the client's goal in conditions of energy, function, quality, time and cost, and the establishment of interactions between resources, integrating, monitoring and managing the contributors to the job and their outcome, and analyzing selecting alternatives in search of the client's satisfaction with the job outcome (Walker A. , 2002).
Client expectation commences with the briefing process. Briefing is seen as one event at the start of the jobs by your client; however this is not the case. Briefing is an activity, where requirements are systematically written down and this will be modified as required. Which means that while the job proceeds and client's awareness of the project rises, the ability to make changes reduces as the project progresses (Atkin, Borgbrant, & Josephson, 2003). The advice is the fact briefing is an activity working throughout the structure project, by which the client's requirements are gradually captured and translated into result by the design team.
Clients nowadays simply expect too much from the design groups; they expect efficiency. Any minimal delays, added costs or design changes are considered as an indicator of incompetence on the part of the architect, engineer or task manager.
Managing client goals is the main element to avoiding unneeded confrontations, needs and claims. Perfection is impossible to achieve, therefore the best approach to ensure that the client is making genuine anticipations about the job and its effects (ACEC Oregon, 2008). Communication is essential to this process. Communication should happen continuously throughout the job especially in the beginning. Stress that efficiency is unattainable at any price and errors and omissions are common parts of the look and construction process.
Clients must understand that they can only expect a standard of health care that will get the managing or design service. These services are given with the ordinary degree of skill and care that might be utilized by other reasonably experienced experts of the same discipline under similar circumstances and conditions. The 'standard of health care' is a thought drawn from British Common Laws doctrine. The doctrine retains that the public has the right to expect services provided will be have done so with a reasonable normal, careful and advisable manner. Quite simply, being perfect is not needed so long as the service provided was done so with a reasonable scheduled skill and care (ACEC Oregon, 2008). Goals to accomplish efficiency however should be set to give the task team a direction and allow for measure of performance if required.
Design jobs are inherently dangerous. Every project is different for some reason and this holds with it uncertainties. Risk is the word used to describe the amount of uncertainty and range of threats that exist or potentially can be found in a task (Ramroth, 2006). Dangers can be complex, physical, commercial or environmental (Walker & Greenwood, 2002). Controlling risk is one of the most important duties for the construction industry as it influences the project benefits (Dey, 2009). This outcome is closely attached within the end result of the project; and at the most basic level, the building and building industry is recognised by its result (Mix, 2001). Client's expectation on risk should be produced known to the look team and subsequently, the project risks should be communicated to the client. Doing so will reduce any misunderstanding and possible confrontations.
Management of risk can be an ongoing process throughout the life span of the job, as risk will be constantly changing. Risk management plans should be located to deal quickly and effectively with hazards if they arise. It's important to work as an integrated job team from the initial possible stages with an open reserve basis to identify hazards throughout the team's source chain (Office of Federal Commerce, 2007).
Identifying and assessing the risks in terms of impact and probability
Establishing and retaining a joint risk register, agreed by the included project team
Establishing types of procedures for activity managing and monitoring hazards throughout the project and during occupation on completion
Ensuring that participants of the team contain the opportunity to take part in a dialogue that will promote arrangement of a proper allocation of risk.
Updating risk information throughout the life of the project
Ensuring control risk by planning how risks are been able through the life span of the task to contain them within satisfactory limits
Allocating responsibility for controlling each risk with the party best able to do so
A common risk management process should be recognized and adopted in any way levels within the involved project team, and the risk register regularly analyzed and updated throughout the job lifecycle (Office of Federal government Commerce, 2007). Investment in producing the brief is often lower; however, this will likely lead to hold off and cost overruns further on in the project anticipated to changes and potential misunderstandings. Making risks known to your client can help them develop and prepare budgets for the project and this allows the job team to evaluate the client's expectation on risk. When preparing the budget, it should include two components of cost, a base estimate and risk allowance. A risk allowance should be included in the cover the project to protect the financial impact of the client's maintained risks as predicted in the chance analysis.
Risks inherent in the maintenance and demolition of a facility is highly recommended during design development and the decisions about risk kept on the sign up for future research (Office of Authorities Commerce, 2007). This inherent risk should be included in the whole life costing of the building.
Is clear and unambiguous
Achieves cost effective for money
Represents a good balance between risk and control
Does not create discord of interest in those necessary to give self-employed advice to your client.
Recoding the offer that is arranged and the protection under the law and commitments of the functions.
Providing sanction for non-compliance, or incentive to comply
Offering packages of types of procedures that the parties should follow
Catering for uncertainty by deciding beforehand how gatherings will bear the chance on unforeseen incidents.
Responding to Risks
Avoidance: where dangers have such serious effects on the task outcome that produce them totally undesirable, measures might add a overview of the project objectives and re-appraisal of the task, possibly resulting in the alternative of the job, or its cancellation.
Redesign: including that arising out of value engineering studies
Different methods of structure: to avoid inherently risky construction techniques
Changing the procurement path: to allocate the risk between the task participants in some other manner.
Transfer: transferring dangers to another party in the included project teams, who be in charge of the consequences, should the risk occur. Hazards shouldn't be transferred until they are simply fully understood. The objective of moving risk is to go away the responsibility to some other party who can better control it.
Retention: Risks that are not avoided or moved are retained by your client although they could have been reduced or distributed. These risks must continue to be managed by the client to minimise their probability and potential impact.
Uncertainty should be recognized as being a dual and coherent dynamics with regards to the environment, composed of the building framework and the management of structure operation for the specific building (Atkin, Borgbrant, & Josephson, 2003).
Two principles that are relevant are the contextual uncertainty and operational doubt.
Contextual uncertainty includes the environment as a whole that may impact on a particular building. The impact could raise doubts about the result or the potency of the achievement. In order to analyse the condition or form of the contextual doubt it is necessary to analyse the building from a broader point of view: the environment, your client and the organisation all together.
Operational doubt is thought as every circumstance which may have an impact on the project's efficiency; that is controlling the execution of construction matching to a predetermined group of goals. The logical stage of the structure process means that job visions are had a need to reduce planning and design uncertainties, and a plan is required to reduce production uncertainty.
Contingency funds should be in place to ensure that any doubt and flaws of the project can be corrected. Clients should be made aware that contingency provisions are created to discover that the final design and development cost may go over the original estimated cost. The contingency finance should add up to a reasonable percentage of the estimated construction cost as a reserve to pay for unanticipated costs. Clients should recognize that no promises can be produced against the task team regarding increased costs within the arranged contingency.
The consumer is satisfied with the design;
The design is right and can be realised through building;
The intent of the creator is correctly communicated; and
All conditions on site can be anticipated
While it isn't possible to ease all hazards, some risks can be taken out by thoughtful problem fixing, while others can be successfully managed so that their impact on the task is kept to the very least (Ramroth, 2006).
Value management is the procedure where the functional benefits associated with a project are made explicit and appraised constant with a value system dependant on the client. From a value management point of view, a project can be an investment by an company on a short-term activity to achieve a main business objective inside a programmed time that comes back added value to the business enterprise activity of the organisation (Kelly, Making client values explicit in value management workshops, 2007). Value management is a organized, multi-disciplinary group decision-making process that encourages the advancement of the value of a task, process or product in a manner consistent with the business goals of the stakeholders and consumer needs. Value management enables stakeholders to define and achieve their need through facilitated workshops that encourage contribution, teamwork and end user buy-in. Stakeholders are people who have a real interest in the results of the project. Stakeholders of structure assignments could be promoters, owners, financiers, supervisors, planners, engineer, constructors, operators, end user and neighbours.
The emphasis of value management is on function affordability, it isn't necessarily to reduce cost. Though lowering cost is actually a by-product of the worthiness management activities (Office of Government Business, 2007). Value means making certain the right alternatives are made about acquiring the optimum balance of benefit in relation to cost and risk, and in its broadest sense, is the power to your client. However with value management, it ought to be recognised that increasing the whole-life project value sometimes will demand additional first capital expenditure. The buildability and maintainability of the center are central to its long-term value. Value management is an extremely low cost with high advantage exercise. The greatest benefit from making use of value management to a project is when it is built-into the project development plan, with workshops programmed to occur.
If built-into the project management methodology early on in the task development the price can be almost negligible, because of the reduced need for following reviews and opportunities for substituting VM for a few of the daily habit appraisals and quality audits that are always necessary (Hammersley, 2002).
The client is the party that take advantage of the long-term operation of the building and therefore should lead the process from inception to the completion of the building. Nonetheless it is advised that clients are not interested in technical correctness. The developer on the other hands has the technical competence, but handling all the interdependencies to attain an optimal scientific solution will often lead to long design durations; affecting the customers expectation on the period of the project. The designer may also have little knowledge on how to produce the look to a finished product. This development knowledge and skill is with the companies and subcontractors, often designers count too greatly on the assumption that the look product is straightforward to produce. Evidently no single party is fully with the capacity of leading, but rather a group of individuals can stand an improved chance of being successful (Atkin, Borgbrant, & Josephson, 2003).
Clients should have plenty of time to increase their knowledge of the project outcome, predicated on their requirement
Clients should be able to change their brain when the issues of their requests are made noticeable to them
Designers should have sufficient period to convert client demands into key complex criteria
Designers should have enough time to investigate the interdependencies of the technological standards in the building system
Contractors and subcontractors, when required, should have the capability to view the impact of decisions regarding constructability
As identified earlier, your client comprehends the merchandise increasingly as the process proceeds. This shows that even though it is hard to control, it ought to be possible to review the requirements of the client in order to make a building that satisfies.
What is Value
Value management is concerned using what value actually means within a particular context, agreeing an obvious statement of objectives and ensuring that solutions are regular with the job aims (Hammersley, 2002).
In value management, value is the amount of importance that is place after a desired function, or combination of functions.
Value is increased by increasing the price of the functions in accordance with the cost (Hammersley, 2002). Value is assumed to be increased when the same functions are given at a lower cost, and also when more desired functions are provided at the same cost. It is also proposed that value is achieved when client satisfaction enhances when the same level of resources are invested (Kelly, Making client ideals explicit in value management workshops, 2007).
Value and Risk Management
Risk and value management are interrelated duties that needs to be completed in parallel. In practice, value management exercises are completed first, to determine precisely what constitutes value to the business from delivery of the task. The integrated task team repeats the parallel exercises of defining value and associates hazards until they reach the optimum balance of value and risk (Office of Administration Business, 2007).
In the evaluation of ideas for bettering value
As another phase of the worthiness management workshop, to recognize and assess the chance and impact proper risks
A full risk workshop
The value management process itself is a risk management process by producing mutual understanding between the stakeholders, developing task learning earlier along the way, challenging assumptions, producing alternatives and promoting synergy between your complete team. Consensus and shared understanding between stakeholders, clear targets, reduced threat of changes in opportunity and improved communications will help ensure that the task meets the business plan goals of the client and is delivered promptly.
Value anatomist is an integral part of value management which considers specific aspects of the design, building, operation and management, it was created to the construction industry during the 1960s (Chen, Chang, & Huang, 2009). It is a continuous process where all the components and process involved with engineering are critically appraised to determine whether better value alternatives or solutions are available. It really is helpful for lowering wasteful procedures and inefficiency in specific areas of the design, construction and maintenance (Lowe & Leiringer, 2006).
All projects will probably include some pointless costs. Unneeded costs are costs which provide neither use, nor life, nor quality, nor appearance, nor features to a job (Kelly & Man, Value manamgement in design and engineering, 1993). However slicing costs without proper examination would likely to decrease the value of the project; only unnecessary cost should be removed where wasteful procedures and/or practices donate to cost. Value engineering is an organised program that uses a combination of common sense and technological knowledge to locate and eliminate needless task costs (Chen, Chang, & Huang, 2009). However value anatomist must not bring about loss of features or quality; otherwise it would reduce the value of the project.
Value engineering can be involved with achieving described functions a minimum cost, usually this is defined as the least whole-life cost. Whole-life costing is a essential component of value management, as it addresses entire costs from the facility from task inception to the disposal of the service (Hammersley, 2002). Examination involves identifying plainly what each one of the individual elements of a project do, rather than concentrating on what they currently are. Functions are split into primary and extra functions and detailed as such. Key functions are the ones that are critical to success. Extra functions support the primary functions. Value engineering is a tight technical self-discipline with clear focus on cost. It is rather important to include client's participation when value executive is completed as this technique will likely to reduce client's identified quality. If value executive is completed minus the acknowledgement of your client, the client's expectation will have been modified for the vale executive process and their recognized quality after structure will in most cases be lower than their expectation.
Value Management and Value Engineering
Positive, focused on value as opposed to focus on cost, and wanting to achieve an maximum balance between quality, whole-life cost and time
Structures, auditable and accountable
Multi-disciplinary, seeking to maximise the creative potential of all job participants this consists of the clients' participation and working alongside one another as a built-in project team
It is said that value management is about getting the right task, whilst value engineering is performed to obtain the task right. Value management address the why questions such as what's the need because of this job or process, value engineering can be involved with how (Hammersley, 2002).
Changes in customer expectation attended about through changes in the new craze in property possession, shrinking business cycles and upsurge in client's knowledge and power to identify particular building materials and functions. Such changes have damaged client expectation a great deal that if it's not monitored properly it might lead to confrontation, discord and ultimately consumer dissatisfaction. Client goals can be handled by risk and value management; so processes can make client expectations explicit through continuous communication and realigning consumer expectation to an authentic level. Understanding client's needs and requirements are vital to understanding their expectation, therefore customer anticipations must be reviewed and agreed to by the task team from the beginning of the project to maximise the advantages of managing client expectation.
List of Figures
Figure 1: Value string for building and structure related industries (Mix, 2001)
Figure 2: Basic client project expectation (Oyegoke, 2006)
Figure 3: Triangle of energy, cost and quality (Lavender, 1996)
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