Construction Management: A Tool To Implement Your Home Construction Plans

Like any other business activity, construction management is important in the successful implementation of a home construction project. In construction management, the homeowner hires a building management professional to handle the supervision of all phases of the construction of the home building. It starts with the drafting of the construction plans (and in some instances include the conceptualization process) and terminates upon the final completion and turnover of the project. The main objective of construction supervision is to see to it that the construction plans and technical specifications are implemented in accordance with the construction contract executed between the homeowner and the building contractor hired by the former. Construction management is sometimes called construction supervision or contract supervision management. It is covered by a separate contract between the owner and the construction management consultant.

The jobs rendered by the construction supervision consultant are grouped as follows:

In some cases, and at the discretion of the owner, the conceptualization of the project is assigned to the contract management professional.

In charge of drafting and finalizing the construction plans including the details and technical specifications.

Prepares the estimated construction cost of the project.

Prepares guidelines in the pre-qualification of contractors and handles the bidding of the home construction project including the selection of the building contractor.

Supervise the overall construction activities and see to it that the construction plans and technical specifications are followed.

Evaluates the performance of the contractor and approves his billings.

Enforces the provision of the construction agreement and sets rules on construction methodology and other aspects of the work.

Conducts regular and final inspection of the project.

Accepts the project upon final completion.

Construction supervision or management can be performed by the homeowner if he has the knowledge about the construction plans, technical specifications, cost estimates, all phases of the construction activities and capabilities in evaluating the bids of contractors. He can save on the management fees to be paid to the contract management consultant which is normally between five to ten percent of the construction cost. If the project is by management, the construction supervision is done away with by strictly adhering to the plans and specifications of the building project.

This aspect of consultancy work is handled by competent professional engineers and architects with proven track record in their field of expertise. A seasoned contract manager is one who is well versed on all aspects of the work under supervision. Do not compromise on this expert work just to cut your budget. Your best pick will show up on the completed home project.

Construction Management – Performance Management of Build Time

This is primarily written about the Australian residential construction market.

What is Construction Management?

To understand how to manage something we must first identify what it is. The four main tenants of construction management are time, budget, quality and safety. Additional items that are also a central responsibility of construction management are regulatory compliance, supply chain management and reporting.

This article focuses on the management of construction time; in later posts I will discuss the other essential elements.

To manage the timely construction of any project you must ensure that all items are properly planned for, including materials, future labour requirements, regulatory and compliance requirements and construction difficulties identified and mitigated, amongst many other things. I am going to concentrate on measures of timely performance, and discuss their positives and negatives.

Construction Time Measurement Strategies

There are many methods of measuring construction performance, and they vary significantly in approach and emphasis:

Stage Timeframe

Reporting periodically (usually monthly) on duration taken from the start of a stage of construction to the end of the stage (e.g. frame, brickwork, fit out, etc.). These are averaged for each stage across all jobs where that construction stage has been completed, in that period.

This allows comparison across multiple supervisors, but is very simplistic as it assumes all contracts should take the same duration in the same stage. It is also prone to significant ups and downs due to the low number of contracts stage completions within a period (anything below seven stage completions makes the statistical average dubious). The other downside to this is that at a monthly average you don’t get the opportunity to resolve problems, you only report on them. It is a good reporting strategy for quarterly, half yearly and yearly supervisor performance charts, and to see the overall average movements across all the supervisors.

Progress Markers

This is about placing a theoretical weight against specific milestone tasks in the contracts construction program, and therefore, recording the completion of these tasks during a time-frame, rewards the supervisor of the job. This can be reported per contract, per supervisor or per construction manager.

As a relatively common strategy it aims at weighting different elements of the construction program and links reward accordingly. It is normally a numeric value associated with each milestone, and therefore easy to statistically analyse to identify figures such as sum of value per week and average weekly value for lifetime of a contract. The downside to the weighted markers approach is that it rewards progress on a small subset of the tasks, and therefore progress might be made such that the numbers look good, however significant other works may be left languishing and the numbers won’t tell you this story.

Baseline Markers

Laying down an ideal world expectation of the construction programme (baseline), allows for comparison at any point in the programme of current forecast against the baseline laid down at the beginning. You are then able to state whether you are ahead or behind the baseline, and give this a numeric value.

This is normally a base measure, which other statistics are gleamed from. Important things to consider are, ‘how realistic is the baseline?’, ‘does the baseline duration adjust with contract complexity and size?’ and ‘do delays outside the control of the construction team get adjusted into the baseline?’ You can also see slippage from the baseline, so that you can easily identify areas of construction issue to be improved. The down side of this is that it consists of a singular number recorded at a point in time against a contract, and therefore is difficult to use to identify trends and averages.

Days of Work Achieved per Period

This measures progress per week against the contract, by measuring the forecast number of days to completion at the beginning of the reporting cycle and then comparing against the same state at the end of the reporting cycle. This gives the metric of days of progress achieved per period, which is a measure of how much closer are you to the end of the project. It allows the complete construction programme to be performance managed, as forgetting items or delaying them will eventually push out the forecast and hence will reduce the number of days progress per period. The issues with this metric is that it can go negative in short periods, and that the construction programme forecast needs a level of accuracy, that can only be achieved with complex project management systems.

Revenue Achieved

At the end of the day, revenue needs to be achieved, and a very common metric is the measure of revenue achieved per period. This is an easy state to collect, and concentrates the supervisors on the important numbers.

The downside to revenue, is that it becomes a numbers game, pushing claims into different periods depending on requirements. This is then very visible to the client, when they check their home against the claim, but the roof isn’t on! Also the inverse happens where a supervisor might delay a claim by a day or two to smooth out for a bad month coming up, messing with important cash flow.

Actual vs Target vs Forecast

None of the performance measures above have included any target setting, and there is no measure of performance against targets. Targets are typically used to get team members to set realistic expectations and manage themselves towards them; a very powerful motivator! This process of target setting can be done on any of the above metrics (and others), but is a very powerful tool when comparing last periods’ target versus actual, then planning for the next week by creating targets from the forecasts (with minor adjustments agreed between the manager and the supervisor).

A powerful tool, but it requires good processes to ensure it works successfully. The method works best when interim reporting is available to the construction team so that they can measure their own tracking against the targets set for themselves.

Conclusion

I have highlighted some of the more common strategies for used construction time performance management, which hopefully gives you a taster of the different methods available. There is no ‘one size fits all’, but it is important to evaluate how to performance manage the most important part of the home builders process; the construction.

In the next article I will be discussing Supplier Performance Management. What metrics are available and how they can be utilised?

Three Top Reasons For Opting For New Home Construction

New home construction is often a better option than buying an existing home. Getting your dream home constructed is the best way to fulfill your specific residential needs. There are several benefits of getting a new home built, such as energy efficiency, modern decor, latest appliances, customized design and cost effective construction. However, you should consider a few things before you actually get your home constructed, such as:

1. Select a reliable builder with an excellent track record.

2. Select the design and layout for the home after proper consideration.

3. Don’t forget to check with the builder during each construction phase.

4. Remember to keep a check on the amount of money being spent.

5. Try to time box the whole process.

According to official reports on residential construction trends in the metropolitan regions of America, the number of residential units constructed annually, between the years 2001 and 2005, grew substantially across all regions. However, a sharp decline in the construction of residential units was observed between 2006 and 2007. The decline rate was higher in single family units than in multifamily units.

Three Popular Reasons for Opting for New Home Construction

Here are top three reasons that have made new home construction the preferred option:

Tailored Design

You can decide on the design depending on your particular requirements and tastes, such as a spacious home office to conduct business, an extra bedroom for guests, a gourmet kitchen, choice of flooring, etc. Also, if you take well thought out decisions during the building process, you will not need to redecorate your home for a long time. Building your own home also ensures that your home is constructed according to your life style and other functional needs.

Modern Facilities and Energy Efficiency

In case you opt to buy a preexisting home, you may have to face several problems, such as lack of adequate insulation, inefficient and obsolete appliances, leaky window panes and chipped tiles. New home construction enables you to install the latest, energy efficient materials, such as energy saving appliances, advanced energy saving windows and high R-value insulation. These energy efficient appliances help to reduce electricity consumption and result in long-term savings.

Superior Quality Workmanship

Hiring the services of reliable and experienced home builders eliminates concerns that are otherwise associated with buying a preexisting home. Further, the superior quality of workmanship ensures that the job gets done in the best possible manner.