In spite of all the planning and preparation that goes into a construction project, statistics show that only about 30% of all construction projects stay within 10% of their initial forecast. This not only undermines the current project’s ability to turn a profit, but will likely result in schedule overages that delay getting started on the next endeavor. Therefore, the following tips can prove helpful to construction project managers looking for ways to stay on budget and on time.
Read more: What Is Construction Project Management?
There are myriad ways in which material delivery inefficiency can sabotage a construction project. First, there is time lost waiting for the materials to arrive. Not only does this slow construction, but it sometimes requires project managers to deploy their skilled workers to run and fetch supplies, resulting in a sub-optimal use of talent.
In addition, the last mile delivery challenges that account for over half of all transportation costs hit the construction industry especially hard. Many construction sites are in areas without clearly defined addresses that are hard for most delivery services to locate.
Construction theft continues to pose a mounting threat at construction sites.
Finally, while material shortages throw the construction schedule off track, too much material can sabotage the budget. Project managers can have a difficult time recouping the costs of unused inventory. Furthermore, construction theft continues to pose a mounting threat at construction sites, with some sources estimating that it has turned into a $1 billion dilemma within the industry. This requires developers to invest in upgraded storage, surveillance, and insurance to protect their material assets.
Solution: Construction teams need to partner with on-demand material delivery specialists adept in the last mile challenges of the construction industry. This can allow project managers to quickly order materials as needed and mitigate the risks associated with carrying too much inventory on site.
2. Use Innovative Payment Tracking Software
Every construction project will involve a complicated web of contractors and sub-contractors. All too often, time is lost as one entity waits for payment from another. According to Levelset, roughly 80% of companies say a good part of their workweek is spent tracking down payment and lien waivers, stalling construction and causing the project to fall behind schedule.
Solution: Invest in innovative payment tracking software that allows for instant disbursement of electronic funds between all entities. The software should seamlessly integrate with Procore, QuickBooks, and any other software used for construction accounting, as well as serving as a digital repository for on-the-go management of all lien waivers.
Read more: Quickbooks Alternatives & Competitors
In order for a construction project to stay on schedule, the ownership, management, and all of the various project teams must be on the same page — not be waiting around for greenlights and go-aheads. To achieve this, all pertinent project documentation must be accessible on demand. Furthermore, communication needs to be streamlined so all relevant parties receive instant notification of important messages.
All pertinent project documentation must be accessible on demand.
Solution: Integrate construction management software. This will give the project management team unprecedented control over the construction process, allowing for easy storage of all important project documentation and adding efficiency to communication and scheduling. The best software solution should have an intuitive smartphone app so managers in the on-the-go construction industry do not have to be in the office to get work done.
4. Avoid Scope Creep
Scope creep is a frequently occurring problem in the construction industry, where seemingly small and manageable projects become larger and more complex as the project develops. Usually the result of poor planning, scope creep has the potential to completely sabotage a project’s budget.
Solution: Although proper planning is definitely essential, it is important to acknowledge that some change will occur in even the most carefully planned projects as construction unfolds. Therefore, the most important factor for keeping scope creep under control is training the management team on how to handle project growth and changes. Remind them to keep the project’s end goal in mind when assessing a growing project.
Labor is one of the most costly aspects of any construction project, even in a best-case scenario. There is a high degree of variability when planning labor, as it can be difficult to pinpoint exactly how many person-hours and how much machinery will be required to complete a project. In addition, construction errors can be especially catastrophic for project budgets. Upwards of 7% of total work hours can be spent in rework scenarios to correct mistakes, according to eSUB.
Upwards of 7% of total work hours can be spent in rework scenarios to correct mistakes.
Solution: Choose innovative building materials that are less labor-intensive. For example, ICF construction can be more affordable than typical framing methods because concrete wall panels require fewer workers and less machinery to create. According to Fox Blocks, an additional benefit of ICF tilt wall construction is that because the panels can be poured on-site, transportation costs of hauling cumbersome framing are eliminated. Another great option for reducing labor requirements is to use synthetic roofing and flooring that is lightweight and does not require as much heavy machinery or skilled professionals to install.
How to Stay on Budget and on Time
In order for a construction project to be profitable, it must stay on time and within the allotted budget. By carefully considering the helpful tips listed above, construction project managers can help their team achieve both of these critical requirements for construction success.
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