A successful project for commercial contractors, both general contractors, and subcontractors, is one that is completed on time and on budget. The client is pleased with the final result, and the contractor makes some decent returns. Everyone comes out ahead. Project failure is usually due to conflicts and occurrences that cause cost overheads and mishaps in the delivery schedule.
Without proper oversight, budget overruns are bound to happen and deadlines for deliverables are likely to be missed. Surpassing budget reduces the contractor’s profit while also subjecting him to liquidated damages for each day he stays past the due date. It can also have an impact on future projects if additional workers and tools are diverted to complete a failing project.
Here are the 5 reasons why construction projects fail.
Inadequate Planning
Inadequate planning results in ineffective implementation. This begins with properly analyzing and comprehending the action plan, requirements, scope of work, and client expectations. Continuing to work with the client, architect, subcontractors, and suppliers to establish construction schedules and timelines is part of good planning.
Planning entails more than just formulating a construction schedule. Conducting a risk assessment and management strategy, developing site-specific safety plans, having contingencies, site logistics, and coordinating the delivery of equipment and materials are all equally important. Remember that the plan and schedule are real-time documents that must be updated and adjusted as the work proceeds.
Failure to Communicate
A successful construction project requires effective communication. Once communication among stakeholders fails or is mismanaged, it can lead to delays, mishaps, expensive overhauls, and dissatisfied clients.
It is therefore imperative to create a communication strategy and document guidelines. Specify a primary contact person through whom all correspondence will flow. All correspondence should be documented and distributed to the relevant parties. Documenting even the small seemingly unimportant phone calls or meeting notes, will go a long way toward resolving any conflicts or misunderstandings that may come about in the future.
Scope Creep and Change Orders
Scope creep is defined as the continuous increment or modification of the
project’s original scope above what was originally intended. Vaguely defined
scope, inadequate plans and specifications, poor communication, mismanagement
of change orders, and clients having a change of heart about what they want
are all variables that leads to scope creep.
Change orders are comparable in that they involve changes to plans that are
outside the scope of the original project. Change orders are distinct from
scope creep in that they can include both additions and removals from the
original scope. Change orders can be started by the client, but General
Contractors and sub-contractors can also request them.
Productivity Mishaps and Delays
Apart from delays caused by events out of our control like natural disasters other delays are avoidable or can be made to have a very little Impact on the bottom line. Productivity expectations of a project are included on the project schedules and man-hours calculated keeping in mind their capabilities. As such, it is important that all the workers pull their weight and deliver as expected. If they don’t, you might be forced to sub-contract more workers which results in low profit margins at the end of the day.
Providing training and conducting background checks for your employees (and subcontractors) to ascertain their ability to deliver is very key. Roles and responsibilities should be clearly laid out, tools and equipment readily available to ensure a seamless flow of work.
Ignoring Red Flags
Red flags are warning signs that a project is starting to fail or a smoke signal of things that are about to go wrong. It is the nature of an issue to bludgeon into a bigger one is left unattended to. All problems arising should be solved expeditiously without procrastination and this calls for analysis, troubleshooting, and strong problem solving skills from project managers.
