When it comes to keeping construction projects on track, there’s a lot of factors that come into play. According to KPMG
, over 50% of engineering and construction professionals have reported one or more underperforming projects in 2015. Think back on your past projects, did any take longer than expected or cost more than you scoped? To avoid potential problems in the future, consider these six helpful construction project management tips to not only keep your plan in check but also on budget.
1. Set a Budget
This may seem like a no-brainer, but it’s incredibly important to remember. After all, you can’t stay on budget without a budget, especially if it’s not a realistic one. According to McKinsey Global Institute
, 98% of megaprojects become delayed or over budget. The best way to start the budgeting process is to review previous projects that were similar in need and scope. By using similar projects as a reference, you’ll be able to adjust as necessary, set expectations, and remember to plan for critical scenarios that either helped or hurt the cost of the project. Another important aspect of establishing a realistic budget is clear communication between you and your client on project costs, timing and expectations.
2. Plan for Changes
It’s no secret that scope creep can hurt a budget – and we all know plans can change. You’ll be more likely to stay on budget if you manage expectations with the client and include some wiggle room for changes to occur. Project Analysis Group
found that an average of 35% of all construction projects have had a major change. Being inflexible to changes can hurt your relationship with the client and accommodating too many changes can sink your budget–and probably your timeline, too. Healthy communication is essential in preventing any changes from derailing the whole project. Having a framework for communicating changes from the client will help you stay on time and budget while making the process easier for your team.
3. Assemble Your Team
According to KPMG
, 69% of owners say poor contractor performance is the single biggest reason for project underperformance and because of this, finding the right team is essential. You need a group that you can trust and delegate tasks to without worries. Though challenging, creating industry connections will be your best bet on finding and maintaining a team that will keep a project moving on time and within budget. Word of mouth is an excellent way to find workers, as well as industry-specific job platforms like BuiltWorlds.
And even then, experienced workers can be hard to find. Training can help fill in those gaps and keep team members prepared and ready to complete their assignments. Workers who know what they need to do and what their job title entails help improve efficiency. With increased efficiency, projects can be completed quicker with less mistakes the first time around. Training is a significant long-term investment and can help save your project and business money down the line.
4. Try Project Accounting
Project accounting is similar to financial accounting, but it focuses exclusively on tracking the economic progress of a project. This type of accounting also concentrates on monitoring project-specific transactions, as well as reporting and forecasting. As you can imagine, this helps immensely in project management and can identify potential problems before they arise, which will help keep you on budget.
5. Use Project Management Software
There are many different comprehensive project management solutions available and these types of tools may prove to be invaluable when it comes to the success of managing a project. These software programs can aid in tracking the progress of a project and point you to specific items that risk putting you over budget. Many of these programs not only assist in managing the development of a project but also in tracking staff time and calculating key performance indicators like effective bill rate and profitability.
6. Review Projects Post-Completion
After finishing a project, make sure to take a hard look at the process, team, and numbers. The best way to learn and plan for future projects is to look back and see what went right and what needs improving from your most recent project. By using construction software, you can revisit all the data from your project providing a history of insight that can prove helpful for future planning.
Construction management can be complicated, but with these six tips you can prepare for unexpected challenges, build an effective team, track progress, and productively plan for future projects to make them more efficient and profitable moving forward.