Value Management & Life Cycle Costing

Performance of construction projects and indicators

Construction business involves participation of client, contractors, subcontractors and regulators. It is important that the Construction Company should have a plan that defines and evaluates the performance of a company.

Everyone will agree that delays can be ignored if there is no compromise on quality, productivity, and cost and client satisfaction. But point of argument comes in play when health, safety and environmental factors among client and contractors are a cause for concern.

Many events need special attention like material and resource shortages or occurrence of accidents. Change in design or schedule due to unexpected discovery of something like price hike, problem finding highly qualified and skilled project manager can derail a project from the course of completion on time. A predefined contingency plan can help in mitigating these risks. Following are the different stages for which contingency plans can be prepared:

1- Investment: where client decides how much to invest and when.

2- Authorization: where client officially gives permission to contractor to start work

3- Occupancy: where project can be used.

4- End of Evaluation: date up to which contractor is legally obliged to make amendments to the project.

5- End of project: date after the contractor is not legally responsible for the project.


Problem of performance in construction industry

Normally any construction project fails or gets in troubles because of delays. Performance issues can be categorized as follows.

1- Shortage of resources: lack of availability of budget, material

2- Client or consultant incompetence: design issues, planning hindrances, permissions or approvals, and so on.

3- Inadequacies of contractor / subcontractor: delays, shortage of skilled labor, management change, incorrect tools and techniques.


Construction management and performance

One of the main factors that could affect performance is management, which includes progress not up to the mark, budget over runs, conflict in contractor and client relationship, disputes, unavailability of subcontractor, and so on.

Effective communication between team managers can help accelerate project management, aiding in planning, efficient coordination and smooth execution.

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