A construction project can often feel like spinning plates, as costs, crews, permits, and timelines are all in motion. But with the right construct, you can maintain control and deliver on the promise. This resource outlines how to use disciplined construction management strategies to preserve your budget, and your schedule.
Why Do Construction Projects Go Over Budget?
A project drifts when small decisions accumulate without any plan. Scope changes, delayed approvals, unclear drawings — all these factors can have unanticipated consequences that will reverberate through the labor and materials. Price spikes for steel or concrete, and rework from quality issues, are two other issues that can also inflate costs.
Robust risk management (read more here) will catch these threats early to assign ownership to each risk. Using the right project delivery methods — design-build versus design-bid-build, for example — can also eliminate surprises by aligning design and construction decisions. When you keep track of assumptions, document decisions, and establish a close feedback loop, you can stop the “budget leaks” before they become a flood.
How Managers Track Spending
You maintain costs in accordance with the budget by making costs visible. You will set a baseline budget, developed by cost codes, and you should compare actual channel costs, listed in an organized way, against the plan every week. You can think of the job as a living ledger: each commitment, invoice, and change must map to the plan.
This is the advantage of commercial construction management practices, because they help to create visibility and easy trail for expenditures which can be difficult to ignore.
- Establish committed vs. tracking actual costs so you can see overruns before they occur.
- Use earned value to compare work completed on the schedule to money spent against the budget.
- Implement change order management with clear thresholds and approved paths.
- Initiate and manage value engineering with the design team to remove costs without impacting performance.
Scheduling Tools and Techniques Explained
A realistic schedule represents more than just dates, it represents logic. Start with a critical path method (CPM) plan so you understand which activities are actually driving the schedule. Then, maintain the schedule with look-ahead plans, procurement logs and tracking of constraints.
Keep project coordination alive with daily huddles to align crew activities and weekly schedule updates to adjust sequencing as conditions change. Strong coordination with subcontractors (i.e. managing shop drawing submissions through to inspections) will ensure continuity of work within hand-offs.
Use buffers on longer lead items and lock in key milestones so that the whole team can see the things that can and cannot slip. When the schedule is perceived to be a decision-making tool (rather than a poster), it can be used to manage delays.
The Role of Communication in Preventing Delays
Most schedule problems start out as information problems but can be resolved by having predictable rhythms and responsive approaches. IF you give every stakeholder the ability to ask, answer and document questions so they won’t sit in folders or inboxes, the problems will not become delays. When all expectations are shared, field crews return to work; working more efficiently and with less misunderstanding when you are not present.
- Create weekly OAC meetings with agendas, action items and owners.
- List and track progress of RFIs and submittals with responsiveness due dates and escalation rules for follow-up. Visit https://en.wikipedia.org/wiki/Request_for_information for details.
- Share a site logistics plan to address coordination for deliveries, cranes, safety route and other matters.
- Ensure that the procurement log is tied to milestones so that late materials do not slip into the critical path.
Case Study: Staying on Track
Consider you are managing the renovation of a 12,000 s.f. Office with a balanced budget of $2,400,000 and a 24-week schedule. You start with a CPM plan, a cost-code baseline of records, an opportunity to determine/identify key hurdles. You hold an early risk review, and the project mentions long-lead times for HVAC equipment. As a corrective action, you release all HVAC equipment in week 1, complete a risk approach to tie down delivery with firm dates in the project schedule.
Now, assume a layout change – you now have glass walls; thankfully the team has basic trade pricing from their original work, so pricing ‘the new gun-biter’ is done really fast, you issue a documented change for the existing conditions, and other than change, many performance costs were offset with a lighting alternate. Weekly, other aspects were able to utilize the same logic and keep finishes sequenced related to floors.
In coalescing alignments of the general contractor and trade workers, start performing daily huddles, which allow field teams to clarify any questions related to the correctness of their work before doing it.
Ultimately put together and clearly articulated a means to determine substantial completion was the goal, for that being approximately week 24. You have used less than 1% of your scheduled float, and total change orders (only) account for less than 3% of the project, and project delivery was attributable to not so difficult ideas of communication and control.
