Why would you need a guide to project management? There comes a point in every property developers career when they decide they want to take on the responsibility for Project Management themselves. There are many ways to do this. The correct way or numerous incorrect ways. It doesn’t matter how new to this or inexperienced you are, your chances of success will depend on how much professionalism you approach this role with.
Therefore it’s important to understand what a Project Manager ( PM) needs to focus on, the different stages of a project, the particular risks you face and the legal requirements you must consider
Key areas of Project Management
- Scope
- Schedule
- Finance
- Risk
- Quality
- Resources
Any PM must consider the above when they are planning their project, so let’s look at these individually and understand what they mean and why they are important.
Scope
The scope of the project means every activity that needs to be undertaken during the lifecycle of the project from conception to completion. A construction project is a complex undertaking , is constantly changing and has many moving parts. Each activity is dependant on the previous one and has an effect on the following one. We must also consider all activities that are needed before construction begins.
Schedule
The schedule of a project is the date it starts, the sequence of activities and the duration of the project and the date it ends. Remember this. THE END DATE DOESN’T MOVE. As the PM your job is to move heaven and earth to get the project over the line on time
Finance
Assuming you already have finance in place you will have to decide how and when this is deployed. Money is the oil that keeps every project moving so you cant let it dry up. This will influence the payment terms you agree with your builders and suppliers. This will be of particular concern when you are using development finance , which is paid in arrears. You may find it hard to find a builder who is prepared to wait for their money. And when you do find one they may charge higher rates due to the fact they are waiting for payment. Don’t forget there are financial elements to take into account during contract negotiations such as variation orders and retention clauses. These will all have an effect on cashflow
Risk
Every construction project by its nature involves risk . Refurbishment projects contain more risk then new builds. However the biggest risks you will face will be delays and time overruns. The 2 most common causes of these are accidents and defective workmanship. A serious accident on site has the potential to delay or even stop a project. Therefore its essential that you have a robust Health and Safety policy. Not only does poor workmanship cause delays it also wastes money. To prevent this the importance of Quality Assurance cannot be overstated
Quality
As previously mentioned Quality Assurance is an issue you must be on top of. A lot of work these days is done on a price, Therefore there is a tendency for a lot of tradesmen to focus on quantity rather then quality. As PM you must make sure everything is installed to the correct spec, in accordance with the relevant British Standards and any requirements for building regs and as shown on the drawings
Resources
These are the resources you have available to you to assist in the delivery of your project. They include any professionals you can call in, everyone involved in the supply chain as well as builders/tradesmen. Everyone has heard the saying “a bad workman blames his tools”. For the purposes of a project these are your tools. You need to decide how to select the most effective one for each step of the project. You also need to know how to get the best out of each one and when to replace them with another tool if necessary
Different stages of a project
- Preconstruction phase
- Construction phase
- Post construction phase
Preconstruction phase
This encompasses every activity that needs to be completed before construction starts. I can make you a promise here. You will make or break any project at the preconstruction phase. Get it wrong here and it will be an uphill struggle from day one. Get it right and you will be able to deal with any problems that occur in a proactive manner rather then a reactive one. This might be the only time you have a breathing space and time to think, so use it wisely.
The key thing to consider is protecting your investment. With that in mind try and think of every single thing you can do to derisk your project. Think of every activity that poses a risk to your capital. Where possible eliminate that activity from the project. If you can’t eliminate it then think of a measure to mitigate the risk
Construction phase
This is the stage that your capital is most at risk. So it’s essential that you get this right. Things will change on a daily basis. You will find yourself updating your programme of works every week. This is normal but whatever happens you must keep the project on programme. If work falls seriously behind you will need to create an accelerated programme. The key is to deal with problems immediately and keep the project moving at all costs. Think carefully before making changes, as this can lead to scope creep and margin creep.
It’s critical that during the preconstruction phase you have agreed with your builder a method for agreeing any extras or variations that may crop up. If you haven’t already agreed this it may cause delays when these issues arise during the construction phase. When things go wrong there is nowhere to hide. You are the one in charge and everyone is looking at you to make a decision
Post construction phase
The physical work may be done but the project isn’t over. There are still numerous things to be done. This includes off hiring off plant , vehicles, site cabins and storage units, getting cleaners in and the marketing of the completed property.
You will need to collect all relevant paperwork such as quality assurance documentation, electrical and gas certificates, as built drawings and building warranties. Building control can be slow to produce documentation so don’t forget about this. Final accounts must be settled with contractors and suppliers. There will usually be some snagging issues to deal with as well as any retention amounts retained in accordance with the contract
Legal requirements
As PM there are several pieces of legislation you will need to be aware of
CDM Regulations 2015
Health and safety at work act 1974
Management of health and safety regulations 1999
RIDDOR 2013
It’s important that you understand what your legal obligations are in regards to the above legislation. It’s vital you understand what role you will assume under the CDM Regs 2015. This will change depending on if you are also acting as the client, the designer of the project and if you will be using a main contractor or individual subcontractors. You can read more about the CDM regs on the HSE website here: CDM 2015
WARNING!!!
There are severe penalties for breaching the above legislation. The Health and Safety Executive will cut you no slack at all for lack of experience, in the event of a serious accident
Essentials before you start a project
- Contract
- Specification documents
- Schedule of works
- Project programme
- Construction drawings
Contract
It’s vital that you have selected the right contract with your builder. Many builders are not used to dealing with JCT contracts, so make sure your builder is crystal clear as to what they have signed up to. On the other hand some of them are extremely experienced , so make sure you fully understand what your responsibilities are. During any disputes on site, you will constantly refer back to the contract as a point of reference. It is often the case that the client loses money as they don’t fully understand the contract.
When you are negotiating a contract with a builder or sending out tenders, its vital you include the specification documents, schedule of works, construction drawings and project programme. This is so the builder has the full picture of what the project involves
Specification documents
These are the documents that contain the actual details of the project. They will detail the exact type and make of materials to be used. Sometimes there is a spec for the construction and a spec for the finishings. The finishing spec will contain details of colours and soft furnishings. These need to be as detailed as possible to eliminate any misunderstandings. Some of the materials or appliances you want will have long lead times from the suppliers. That’s why the builder needs as much specific detail as possible so he can organise deliveries
Schedule of works
A schedule of works details exactly what activities need to be done. This is to make sure each item can be priced for and nothing is missed. Again the more detailed this is there is less chance of misunderstandings and delays. Don’t expect the builder to automatically know what you want or are thinking. This document is essential to help you with your costings. Once you have this you may wish to delete certain items and avoid unnecessary expenditure. The builder can’t be blamed for missing things if you don’t include them in this
Project programme
This document will be the Bible of the project. It will outline the order in which activities will be carried out. The builder will sign up to this before the project starts. If he falls behind programme he will need to demonstrate to you how he will get the project back on programme. A lot of projects don’t go to plan so you will find yourself revising this every week. You will keep the original programme and this will be called the baseline programme. You will be able to measure efficiency and progress by comparing your updated programme to the baseline programme. This will also include any key dates or milestones
It’s important that you discuss the programme with the builder before starting. This is to ensure that the timeframes you have estimated are actually achievable. It will also give the builder a chance to efficiently plan material deliveries. Depending on the contract you have chosen there may be financial implications for the builder falling behind programme. However it maybe the case that the builder has fallen behind because you have not fulfilled your responsibilities. In that case you may have to request the builder to bring in additional labour. This will now become a financial liability for you
Construction drawings
It’s essential that you give the builder the right drawings. This may sound common sense but it’s a common problem. At the contract negotiation stage the builder must be able to see what exactly is required from him. Outline planning drawings are not good enough. They must be detailed with any requirements from building control included. If you or the Architect issues revised drawings the builder must be issued with them immediately. If this means there is work to be added or withdrawn, this may have a financial implication. So these costs must be discussed and agreed with the builder immediately
Summary
A Project Manager is a highly skilled position. Its not something you can just wake up one day and decide to do. You might be able to get a little refurb completed, but you wont be doing it in a legally compliant and safe manner. And you will be losing money at every step through inefficiency.
Projects rarely go smoothly, but that’s just the way it is. Remember no matter how bad it gets and how many problems there are , the project still has to come in on time and on budget. But it’s not just going to happen by itself. It’s up to YOU to get out there and make it happen
It gets lonely at the top. You are on your own. Don’t look to others to bail you out. You are in charge and everyone is looking to you to sort it out. Sometimes the only thing you can do is go out on site and get hold of the project by the scruff of the neck and drag it kicking and screaming over the line.
Good luck!!!
Project Management is only one of the services that we offer. Please contact us to see how we can help you with your project