Schedule, scope and cost are the essential bottom-line issues every project faces regardless of size. These factors are always competing. For example, adding more scope typically creates more costs and time to complete, while a client putting pressure on a contractor to finish the project early may result in deficient quality and more costs for overtime work. Typically, everyone looks very carefully at cost, but schedule very much affects cost and is often the hardest element to manage. General conditions and management labor by your general contractor is a large part of the overall expense, which runs from a low of 7% of the construction cost to as high as 15% or more. These costs are based primarily on the duration of the project. Time extensions add duration for time sensitive soft costs necessary to manage the construction process such as architecture and engineering, inspections and other fees. However, there are construction management strategies to manage the bottlenecks that threaten to bog down a project. For greatest effect, pay attention to the key points below early in the two out of four construction phases, planning and preconstruction.
A contractor’s construction schedule will reveal a lot about their capabilities and experience in managing approval cycles and milestones.
A very important key in project planning in the construction industry is a schedule. When interviewing contractors, ask how they prepare their construction schedules—this will reveal a lot about their capabilities and experience in managing approval cycles and milestones. Ask for a sample schedule of a recent project of similar size and scale. Do they use the critical path method and can they show you a report that highlights these essential linked tasks? An experienced construction professional should be able to review a set of drawings and reasonably estimate the construction duration. Examine contractors’ schedule assumptions to discern if they are realistic or overly optimistic and whether they believe they can deliver the project in the time frame that matches the owner’s expectations.
Schedule very much affects cost and is often the hardest element to manage.
Require contractors to prepare detailed critical path schedules that show all factors that affect time, such as shop drawings and submittals review cycles, architect and owners’ review and approval cycles, manufacture/fabrication lead times for materials, installation, and interrelationships between trades. Look at more than just their initial preparation of the schedule, it is essential to update the schedule regularly as things change. A good contractor will double-check for errors, missing elements (such as time for the owner to select finishes and long lead items), inadequate or excessive float time and faulty logic between elements. A vital construction management technique is to check and update the schedule regularly, often every 4 weeks. Require the contractor to provide a 2-week look-ahead report at every weekly meeting and see how their work compares to the previous look-ahead over the past two weeks. It is important to ascertain or even anticipate when the contractor is about to fall behind and to make positive suggestions to keep them on track, such as adding crews, adjusting the work flow or reordering non-critical path tasks.
Contractual schedule provisions may not be the best defense against schedule overruns.
Most contracts carry the requirement that “time is of the essence”, but is this really sufficient to keep the contractor on time? After all, time delays are notorious in the construction industry. Many clients and attorneys request a liquidated damages (LD) clause, which defines a particular cost the contractor must pay to the owner for late completion—often $500 to $1000 per day. But, such an LD clause cuts both ways. Many contractors simply increase their bid to cover potential delays, so the client is effectively paying their own delay costs. Worse, this provision often sets up an adversarial relationship with the contractor from the beginning of the project and can lead to increased project administration as the contractor feels obligated to document all delays. If the project architect takes too long to issue field directives or review shop drawings, a claim for additional time can ensue. Communication between project participants can devolve into blaming each other, rather than the spirit of cooperative problem solving. While LD clauses have their place in commercial projects that have complete architectural drawings and fixed schedules for a retail store Christmas season, they don’t work well for residential projects. For homes, contractors often rightfully complain that the owner (or their agents the architect or interior designer) holds up the process with slow decision making or changes during construction. In this case the owner has more control over avoiding schedule delays than the contractor, so the contractor rightfully resists being held liable.
Better approaches to improved scheduling in construction management.
While it is useful that the schedule provision of a contract has teeth, there are better, more holistic ways to promote timely project completion. Consider these key points:
- Spend the time necessary in planning and design to identify as many as possible owner decisions. Too often owners are in such a rush to start the project, yet what matters more is a tight project duration and timely completion.
- Require the architect to provide complete plans. There are vast differences in architect deliverables – ask your contractor about the quality of the plans received to date.
- Contract for full engineering during the design phase. Many technical requirements of residential projects such as electrical, plumbing and mechanical engineering are left to the contractor to work out in the field, which can also cause delays, or worse, disputes about scope and quality.
- Commence early project discovery. If you’re embarking on a remodel, engage your contractor to perform some selective demolition to understand how the building is framed, wired or plumbed. This information is valuable and could mitigate costly change orders and their incumbent delays later.
- Avoid too much change during construction. In addition to increased costs, change orders take time to design, price, subcontract, schedule and finally complete the work in the field. This is a key variable that the owner really has more control over than the contractor and is a great way to mitigate pressure on the schedule.
- As the owner, insist on a realistic project plan that includes all desired scope and an achievable project budget and schedule. Avoid the urge to push too aggressively for better pricing or impossible delivery dates as these often backfire. Project Managers can use project budgeting techniques to help you attain an achievable project budget and provide realistic timelines.
Creating a professional, well-functioning project team, fostering communication and managing that team in accordance with the project plan will accomplish more for your project than a $1000 per day penalty for late completion.
Good team work & communication are essential to project efficiency.
It is critical to flush out schedule expectations and problems early. A good construction manager will reduce costs by accelerating the design and construction schedule, ensure that project scope is properly documented in the drawings and specifications to reduce change orders and maintain a cooperative attitude. It is fundamental to Stonemark’s process that the contractor, architect, owner and all project participants are encouraged to work together as a team to provide full information, which we then organize to create efficient project delivery. The importance of communication cannot be overemphasized—team solidarity allows for early problem solving and tighter control of the schedule. Such clear organization and process controls on schedule can make the difference between a successful project and an unhappy client.