Let's face it, most contractors got into the business because they like to build things, and often little else about the business of construction interests them. Being able to look at something and say “I built that” offers boundless pride. However, in order to continue with that success, contractors must have the same pride in managing their businesses. The contractor needs to look at his or her organization and say, “I built this company.” The organization and processes for marketing, human resources, finance, accounting, and field management throughout the company should be built with as much pride as the finished construction project. Project management is one of the critical areas that link building with the business of building, and, when done well, should be a source of pride for any contractor.
Much of the ultimate success of a project is determined before it is ever awarded. If a sales person/owner brings in a set of plans and puts it on an estimator's desk without any further information with the request to bid it, the result will likely be a lost bid, a missed scope item, or some other foul-up caused by the lack of adequate information. When estimating receives the request to bid, there should be a pre-bid meeting held with all potential team members, including estimator, controller, scheduler, project manager, and superintendent, to review the project and determine, among other things, if the project should be bid at all. There should be questions about the completeness of the drawings, the need for a site review, the method of construction, materials used, labor availability, as well as suggested process improvements and selling points. The first step in project planning and project management begins even before the estimate is completed and the job awarded.
Many will say that meetings are a waste of time, and there is no formal structure or attendees aren't prepared. When you consider that, according to a recent FMI survey, the bit rate for proposals for concrete contractors is only around 28% of submitted proposals, then pre-bid meetings that help to improve that number by even 5% will reduce your cost of sales and boost your image with customers. Just as importantly, these meetings help your team take early ownership of the project. That sense of ownership and depth of project knowledge should flow into a formal hand-off between sales and project management, and between project management and the field, to ensure that all expectations for the project are understood and recorded. Formal meetings should continue throughout the project at key transition points with project managers taking a prominent position at the table.
Increasingly, the project manager's job is to manage the flow of information and documents. Therefore, it is essential to have information control and monitoring processes in place including consistent documentation procedures that assure that project files are maintained consistently from project to project. When these processes exist, personnel who go from one project to another can readily find plans, purchase orders, submittals, subcontracts, invoices, and so forth. There should also be a common method of tracking submittals and RFIs, so that project managers can efficiently review the status of a project. If submittals pile up, construction, invoicing, and collections slow down. Every construction company should have a change-order process that allows for clear documentation of change orders and facilitates quick resolution.
After the project is built, assemble the entire project team to review productivity, customer satisfaction, best practices, standard operating procedures, and other learning opportunities. Companies that perform postmortem project analysis have fewer poor performing projects and increase the collective knowledge of the company. Once you have built an organization that successfully and profitably manages projects, you can take pride in the finished project and in the organization that built it.
— Brian Moore is a consultant with FMI, Management Consultants to the Construction Industry. Brian works with contractors on various strategic, financial, and operational issues. Specifically, his work at FMI involves in-depth market analysis, strategic and business planning, and market planning for clients throughout the nation He can be reached at 919-785-9269, or by e-mail at email@example.com.