Insights

How many construction projects over $10 million would you assume are successful? The answer might surprise you.

According to a recent Global Construction Survey by KPMG, more than 60% of organizations with that level of spend have had at least one failed construction project. With extraordinarily high stakes, one has to wonder: Could these project failures have been prevented? The answer is likely, yes.

Here are 5 primary culprits of faulty project management that, if properly addressed, will be less likely to later become landmines that disrupt a project irreversibly.

1. Owner and Contractor Have Very Different Visions

How is it that an owner and contractor can be on such different pages in terms of the final interpretation of the project? One of the places where things go wrong is at the very onset of the project, in which clear objectives and priorities need to be communicated. It’s an opportunity for a discussion on all specifications to occur, including products, materials, and method of installation. This conversation on project details is critical to minimizing the event that the construction team will continually be taking two steps back before they can take one step forward.

We should also mention that as important as communication is at the beginning of the project, it has to be ever-present for the duration of the project as well. Assume that new challenges will arise, new requests will occur and changes that were never in the plans may suddenly be on the table for discussion. When that happens, the channels of communication between owner and contractor must remain open for information to be clearly conveyed and decisions to be made with the utmost efficiency based on that information.

2. Project Scope too Loosely Defined

In-depth discussions on objectives and project parameters to avoid miscommunication are critical. What is included as part of the work? What falls outside the project parameters? How are changes handled? Work requests that move beyond the scope of the original agreement can lead to a breakdown of communication and project delays.Project scope must be tightly defined at the beginning and consistently conveyed throughout the project schedule to ensure all parties are in agreement on tasks, milestones, and goals.

3. Pricing the Project Incorrectly

There are a whole host of components that go into a project estimate, from permits to the full cost of materials and labor. Leave out any of these crucial elements and not only are the final numbers sure to be thrown off but ultimately the entire project could come to a standstill due to premature resource exhaustion.If the planning phase is rushed and the firm moves too quickly into estimating the project, it leaves the door open for serious problems to enter later on.

4. New Risk Factors that Were Never Planned for

A project site floods. Asbestos is found in the walls. On most construction projects, it’s only a matter of time before an unexpected event forces a fundamental adjustment to the design plans. Few enjoy thinking of what could be a devastating event to a project’s timeline, but it’s better to plan for such possibilities than pretend that they may never happen. While project managers can’t predict when a flood or discovery of mold will occur, they can prepare as though one will. If a certain condition occurs, what is the contingency plan? If a natural disaster occurs, delaying the project by three weeks, what comes next? The project team has to have a plan of action for as many “what if” moments as possible with executable next steps. This way, the team can move forward with confidence. It’s important to talk about “what if” scenarios as early on in the project as possible, even during contract negotiations.

5. Experienced Project Managers and Planners are Hard to Find

The KPMG Survey found that a variety of projects had difficulty identifying and retaining quality talent. Nearly half of all those surveyed expressed a challenge in finding project managers and planners they would consider to be highly qualified for the project. This undoubtedly has contributed to project cost overrun and delays.

Highly qualified project managers and planners can give owners a strong sense of confidence based on their project work portfolio. Have they completed other projects like this recently? What were examples of unforeseen circumstances that they overcame? What are the capabilities of the rest of their team? Although a history of consistently solid work that is on time, on budget and relevant may not be an instant guarantee of success but does provide a strong foundation of excellence to consider.

Many Paths to Project Failure. One Tool to Minimize Risk.

Reliability in planning starts with a tool that has been created with collaboration in mind so that schedules and details come together in one seamless process.

By using NetPoint from PMA Technologies, you can implement a highly interactive experience in which all stakeholders on the construction project can be actively engaged and contribute to project planning. When changes to the project need to occur, NetPoint helps you move activities and adjust durations effortlessly, instantly propagating changes to the entire network. All planning objects and data elements update with any schedule modification in real-time. Best of all, NetPoint provides all parties with a deeper insight on the types of activities influencing the project schedule most.

It’s the most naturally intuitive application of its kind of project managers and their teams. So that more projects can be success stories, not stories of delay, derailment, and failure. Set yourself on the path to success and never look back with a demo of NetPoint today.