Construction projects are saddled with a whole host of complexities that require careful planning and management in order to result in a successful, profitable outcome. Most construction businesses themselves struggle with an equally broad set of challenges when comes to successfully running a project-based business. Here are some of those challenges.
Project Visibility. Getting reliable information that’s up-to-date, accurate and detailed enough to understand what’s going on at all levels in a project. As I’m sure you’re aware, knowledge and good information are the ultimate control weapons for keeping projects on track. I often hear C-level managers express frustration about not knowing where they’re at with projects or even parts of projects.
Getting Organized. One of the biggest sore points we hear about from construction management professionals, is a feeling that it just takes too much time, and they need to simplify & streamline how they go about their day-to-day controlling of projects. They often experience a sinking feeling of chaos and a need to pull together all the project-related information, processes and tools into one place where they can plan, execute and report without having to spend endless hours trying to cobble together a simple progress report.
Managing Project Changes. Change can be notorious for causing cost overruns, delays, misunderstandings and even disputes. Changes are easily underestimated and overlooked when you’re busily trying to complete project work. There’s a tendency to be optimistic, agreeable and eager to just get things done and ignore the control aspect of change management. Everyone has to face project changes, but no-one really wants to deal with it.
Access to Information. Many construction organizations struggle with having all their project information well organized and in one place. Information on, for example, rates: such as cost rates, billing rates, equipment rates, subcontractor rates. Historical costs, supplier information, invoices, last year’s purchase orders, equipment lists, previous project results, etc. Whether planning or executing on a project, this information is crucial for providing the context, estimating, negotiating and trends that are necessary for construction projects. When this data is located in spreadsheets, paper invoices, accounting systems and in a word document on someone’s laptop – the effort of pulling it all together is both costly and risky.
Accurate Estimating. Having good estimating practices, tools and the historical information to feed estimates, is a very common challenge that businesses have to overcome to have a hope at running successful projects.
Communication, Collaboration and Transparency. Good reporting on where things are at, at any stage or level of a project – then sharing that status and detail with other project stakeholders. This is not only a key element to good project management practices – but it’s also a critical component to maintaining solid current and future relationships, reputation and quality of work. Keep your outstanding reputation in a shiny place by delivering a high-level of transparency to your customers, subcontractors and internal stakeholders.
Managing Risk. Ensuring that project components that contain known or unknown risks are identified and managed appropriately. This could mean applying contingency, sharing the risk with other stakeholders, or even performing increased upfront analysis. The complexities of risk can be far reaching and cause unforeseen delays and overruns if not managed carefully.
Customer Invoicing. Still billing your customers in a spreadsheet? It’s not uncommon. Having an organized structure around invoicing that’s controlled and simple can be big challenge. It’s pretty important that you don’t double-invoice customers; but at the same time you want to ensure that you don’t miss an invoice either. If you run fixed price projects, time & materials, cost plus or split-billing projects – all the project transactions, progress payment information and financial controls around what has & hasn’t been billed is a tricky thing to manage. Anticipating cash flow around billing is another key aspect to planning future projects. Tough to do all that in a spreadsheet. Or, especially if you have 1,000,000 spreadsheets.
It’s for these exact reasons that powerful tools, processes & methodologies have emerged to help streamline and organize those project and business complexities.