Construction project management is a complex multidisciplinary field that demands knowledge in areas like construction, engineering, finance, business, law, software, and more. Construction project management covers a myriad of tasks that can swiftly change, depending on the work at hand, and entails strong communication skills, thorough working knowledge of the construction process, and analytical thinking skills to solve problems.
Fundamentally, construction project management is handling all the planning, coordination, and execution of a construction project – may it be residential, commercial, institutional, industrial, agricultural, or environmental.
In this pocket guide article, we will try to cover as many aspects of construction management, including construction roles and their duties and responsibilities, the key functions, the bidding process, the different construction phases, and the use of digital tools.
What is construction management?
Construction Management (CM), is “a service that uses specialized, project management techniques to manage the planning, design, and construction of a project, from its beginning to its end”, as defined by the Construction Management Association of America (CMAA). Basically, the purpose of construction management is to control a project’s time, cost and quality. In order to do so, the construction manager leads a team of individuals, each responsible for overseeing the different aspects of the management of a construction project. For all these stakeholders to work together effectively, good communication between them and the construction manager is required. The bottomline of each project is its successful delivery to the client, which is highly dependent on how the construction manager manages information and knowledge between all stakeholders.
What are expected of a good construction manager?
As construction managers are the ones responsible for projects to carry along according to technical plans, it also follows that the whole project is compliant with set standards, codes, and other regulations. Additionally, a construction manager may also set the construction calendar and be in charge of finances, hire subcontractors and on-site staff, and produce resolution strategies for potential conflicts.
According to CMAA’s, the construction manager has about 120 common responsibilities that can be categorised into seven key areas:
- Project management planning
- Cost management
- Time management
- Quality management
- Contract administration
- Safety management
- Construction management professional practices
Where does the contractor come in?
The design phase always comes first in any construction project. Once that’s done, the construction manager opens the bidding to contractors who are interested in handling the project.
General contractors play a huge role in the building process but also depends on their involvement in the design phase. Usually, they are divided into two types: the first one is design-bid-build contractors who execute based on the vision and plan of the architect and designer, whereas the second one – the design-build contractors who create the design, plan and execute thereafter.
Bidding and winning a construction project
The bidding process starts with a cost estimate from blueprints and materials, showing the project owner how much is expected to be paid to the contractor in order to complete the project. Generally, there are two kinds of bids:
- Open Bid. An open bid usually applies to public projects and is advertised to any contractor. Any contractor can bid an offer.
- Closed Bid. With closed bids, private projects are opened by the owner to a select group of contractors and these selected contractors put in their bids.
Regardless of the kind of bid, contractor selection follows based on the following bidding criteria:
- Low-Bid Selection. The project owner focuses on the price wherein the one who submits the lowest price or cost wins the bid.
- Qualifications-Based Selection. Contractors submit a request for qualifications (RFQ) alongside their bid. The RFQ covers the contractor’s experience, management plans, organizational workflow, and successes in project delivery (especially delivering within budget and on schedule). The winning bid is based on the best qualifications.
- Best-Value Selection. Here, bid price and qualifications are considered and the winning bid would be the best combination or compromise of cost and skills.
Once a contractor is chosen, a payment agreement is negotiated. In construction, there are four payment models:
- Lump Sum. It is the most prevalent payment contract. The contractor and project owner agree on the overall cost and the project owner pays that amount even if the project fails or if the final cost goes over the budget.
- Cost-Plus Fee. The owner pays the total cost of the project plus a fixed percentage fee of the overall cost. As this arrangement covers all additional cost, this is the most viable for the contractor.
- Guaranteed Maximum Price. Both parties (owner and contractor) agree on a set price that does not exceed the total cost and fee.
- Unit Price. The unit price model allows for a specific unit price that the owner pays the contractor at each phase of the project. This is usually the option taken when the parties can’t agree on a cost ahead of time.
Principles and processes of project management
Once bidding is done, the construction phase can officially begin. Although construction project stages are sort of different than that of traditional projects, a similar pattern is still being followed. It is highly recommended that the construction project manager should know the five phases of project management that’s developed by the Project Management Institute (PMI).
The first phase includes feasibility testing. Before any project can begin, the project manager has to make a business case and evaluate if the project is feasible. When a project is deemed worth undertaking and parties decide to pursue it, a project initiation document (PID) or a project charter that includes the business needs and a business case, should be developed by the project manager.
Next, a road map must be developed – this is the phase where the project manager creates a project management plan (PMP) which is basically the overall guide to project execution and control, which also established the baselines for scope, cost and schedule. Aside from the PMP, other accompanying planning documents may be:
- Scope statement and documentation
- Communication plan
- Work breakdown structure
- Risk management plan
Now this is where actual work starts. Construction execution begins with a kickoff meeting, followed by the project team assigning resources, effectuating project management plans, implementing tracking systems, monitoring tasks and project schedules, and modifying project plans and schedules if needs be.
Performance and Monitoring
As the execution phase starts, so does the monitoring. Monitoring is significant in measuring progress and performance, and makes sure that all tasks and items align with the overall plan. Project control is where the construction manager’s time dedicated to.
Closure marks the conclusion, completion and delivery of a project. The construction manager does a final check of a project if it met its objectives including time and budget delivery. A punch list is then created with the rest of the project team concerning all remaining tasks, a final budget assessment, and more. Once the final check and non-conformities have been corrected, a handover meeting with the project owner is set and a handover report is given to all shareholders as reference for the lifecycle of the construction project.
Go over this construction project management checklist and make sure you don’t miss anything on your project.
How digitalisation can optimise construction management
We cannot stress enough how complex construction management is. The use of technology in the industry practice definitely plays a huge role in solving common construction problems and improving construction productivity.
Read our article on the most common construction problems and how construction management software can solve them.
Here are main avenues wherein digitalisation of certain construction processes could improve and solve construction management downfalls:
Digital tools enable everyone to have access to a single version of a plan. This allows all stakeholders to be on the same wavelength, which makes coordination easy and straightforward. Hence, efficiency and productivity are boosted.
The perfect construction software allows project stakeholders of making a single, simple communication tool that coordinates and integrates the actions of each team member on site. With an easy-to-use application, it guarantees transparency of construction projects and allows all employees to keep track of any changes to the site in real time.
Digital report generation adds value to your construction site projects. Easily and quickly produce your customised site reports directly while on the field.
Incorporating construction standards in a digital manner ensures greater compliance on your construction site. Digital tools centralise all regulations in one location and ensures compliance to regulations and a solid documentation process.
Quality is the cornerstone of your construction project. Master all the processes of your construction site with the help of your digital tool. Reduce errors, collect data instantly, notify all your shareholders with correct and real-time updates.
Embracing transparency and real-time collaboration create a continuous work flow — a transparent environment makes it easier to resolve issues faster. Efficient and effective tracking aligned with preparedness for unseen events enable the construction team to anticipate micro-changes and allow them to adapt and adjust accordingly. The result would be reduced idle time and a most promising solution to improving construction site productivity.
Construction management is a demanding process with a myriad of complicated tasks needed to be tracked and kept together. It’s a difficult job hence, construction managers need a reference guide for painful situations and to be sure they’re monitoring their project’s progress according to plan.
Our aim for this guide is to be a saveable portable reference to key concepts needed to run a successful construction project.
For an in-depth read on further improving your productivity on site, we have an ebook for you that is free to download. Check out The Circle of Productivity now!