Project Management Case: A Home Build Requires 22 Subcontractors
The average home consists of many different pieces, ranging from basic foundation and framing to HVAC and electrical work. With the diverse needs of a new home build comes a diverse requirement of skills to deliver on the work. Much of this work is skilled, specialty labor that cannot be effectively done by generalists. Smaller homebuilders that are building just a few homes per year can’t retain 20+ specialists on their payroll to fulfill all of the work, and, as a result, home builders heavily rely on subcontractors to complete their new home builds in an effective and cost-efficient way.
As you can imagine, the more specialized a job, the more likely the home builder is to subcontract the work. The top 5 most commonly subcontracted types of work are security system installation, carpeting, HVAC, electrical wiring, and plumbing, averaging over 95% subcontracted work in new homes built, according to a survey by NAHB. Eleven different subcontracted jobs are reported to be subcontracted in at least 90% of home builds, and the majority of new home builds have at least 22 subcontracted roles. In the end, subcontractors comprise 77% of the total cost of building the average home.
Meet the Team that Builds Your Home
While the specialty trades seem like the most obvious choice for subcontracting due to the licenses, schooling, and skills required to perform the trade, other work such as foundation, drywall, masonry, and concrete are reported to subcontracted out by more than 90% of home builders as well.
Requires Sound Project Management
As a home builder, managing 22 subcontractors can be a nightmare. Not only are you dealing with many different companies and people, but their work often relies on each other. For example, drywall can’t be installed until the framing is finished in addition to many other dependencies. How do you manage all of the subcontractors while coordinating schedules? Proper project management is key to successfully managing the home building process.
One of the most difficult aspects of managing many subcontractors that have work dependencies is outlining a realistic schedule that can adjust to unforeseen circumstances. Gantt chart scheduling is critical to getting a good view of availability and dependencies between subcontractors. Being able to view schedules over periods of time and easily adjust for changes keeps your project moving along even with unforeseen events. If the kitchen cabinets are delayed, that typically means that kitchen countertops would need to be pushed back to account for the schedule change.
Project Status and Follow-up
Dealing with many subcontractors also means that you have less of a handle on the status of the work. To be able to properly adjust your schedule based on accurate completion dates relies on timely status updates from the subcontractor. Are they on schedule? When will they be finished? Do we need to push out the expected completion date and notify another subcontractor of the delay? Will they be finished sooner than expected, allowing another subcontractor to begin working sooner? As subcontractor delays pile up, your project will continue to delay as well. Being able to move future work forward can counter delays that are pushing your project back.
Use a Project Management Tool
There are many different tools for project management that fit different purposes. But with the nature of homebuilding being on the job site, the ideal project management tool would have a strong mobile app that allows you to manage your projects from anywhere while also equipping the subcontractors with a mobile app to provide status updates in the form of written notes, files, check-ins, and photos. While updates could be entered manually by the project manager, allowing the subcontractors to provide their own updates streamlines the process and allows for quicker, more frequent updates.
As with human nature, people are often late delivering their work. Whether it’s overzealous time estimates or poor planning on their part, it’s critical to anticipate missed deadlines from subcontractors. A good project manager not only accounts for this but can read into the signs that allow you to forecast these delays. Receiving regular status updates from subcontractors gives you extra insight into their activities and a better read into warning signs based on your experience. The sooner you anticipate delays, the easier it is to adjust and account for them ahead of time before it’s too late.