Reducing Risk on Infrastructure Projects

Reducing Risk on Infrastructure Projects 

Reducing risk on infrastructure and construction projects presents
many logistical challenges. Getting it wrong right at the start will
bring years of headaches. But, by taking a proactive approach,
stakeholders can reduce uncertainty during the planning stage. This
gives project managers insight into mitigating risks on future
infrastructure projects using lessons learned to save on future project
costs.

Risks on infrastructure projects are predictable. These can include the insecurity of funds, cost of project
overruns, failing to source materials and workers, and delays. These are
the common challenges stakeholders face during large infrastructure
projects.

It takes hands on project management to juggle all moving parts of a long-term infrastructure to keep it on track.  

 

Risk performance influenced by uncertainty

According to the Institute of Risk Management research, Managing cost, risk & Uncertainty in infrastructure projects,
project managers face many challenges. This most important phase of a
long-term, infrastructure project is during in the early, planning
stages. A lack of transparent risk assessment during this phase can mean
high risk and uncertainty throughout the project. This can cause:

1. completing a risk analysis with different possible outcomes
2. poor decision-making
3. stakeholder optimism – delusion or deception
4. loss of focus and sub-optimal risk mitigation.

Risk analysis challenges

A risk analysis is subjective, especially on infrastructure projects.
Why? There is no clear way of progressing hypothetical risk analysis to
project specific cost analysis within a commercial structure. There is
also a tendency to exaggerate how well mitigation strategies work. So,
project managers identify unnecessary risks or overestimate the effects
of mitigating project risks. This leads to overestimating costs. 

Challenges of poor decision-making

An Institute for Government (IfG) report, What’s wrong with infrastructure decision making? found the following key flaws in stakeholder decision-making for infrastructure projects:

• No
  strategies for investing in infrastructure. Stakeholders      often do
  not have clear strategies for investing in infrastructure      projects.
  Without infrastructure investment strategies, it is difficult to make
  good decisions. Also, there is nothing to measure project outcomes
  against.
• Little attention paid to
  assessing options at the start. Stakeholders spend too little time
  during project development looking at all the options. This can result
  in missing better project options causing project cost blow outs.
• Misunderstanding
  project risks. Decision-makers can misunderstand project risks. This
  can mean there is little forward planning for when things go wrong.
• Winners
  and losers. Infrastructure projects can divide communities and create
  winners and losers. These groups can have a lot of influence on
  decision-makers and cause project delays.
• Lack
  of project measurement. Stakeholders fail to measure infrastructure
  project outcomes against the costs when completed. Having key
  performance measures is an invaluable tool for future use. This helps
  stakeholders to learn from past mistakes when commissioning new
  infrastructure projects.

Challenges of stakeholder optimism – delusion or deception

Reducing risk on large infrastructure projects depend on whether:

• the assumptions stakeholders adopt are strategic misrepresentation or genuine optimism
• financial managers ignore/misunderstand real risk levels while pressuring for cost reductions to meet short-term financial goals
• there has been an overestimation of the risks by project managers to secure a larger contingency fund and, thus, cover all bases
• pricing from contractors is low to remain competitive but they may use other means to maintain a profit
• there is resistance from project managers to processes and procedures that reduce contingencies and risks.

Complex
projects increase these risks. Taking control and ensuring transparency
from the start helps reduce infrastructure project risks. You can
mitigate risks during the contract phase.

Reduce risks during the contract phase

It can take years to fully complete infrastructure projects, so they have
long-term project plans and phases. During this time legislation and
regulations can change. This needs careful consideration during the
contract phase, especially if dealing with European contractors.
Consider the following:

• Are
  there higher costs related to dealing with a European contractor? Look
  at the different legislation between the two countries.
• If there are changes to immigration legislation that impacts the contractor’s access to workers, who is responsible for this?
• Who is responsible for paying the taxes between the UK and the EU?

You
should also consider the risks associated with currency variations, as
well as the continuity and cost of a skilled workforce. If sourcing
skilled workers from overseas, can you maintain the workforce for the
duration of the project?

It is important to
mitigate these types of risks at the contract stage. Having these set
out in contracts before starting the work can reduce costly potential
conflicts during long-running infrastructure projects.

Overcome challenges on infrastructure projects using transparency. Good construction risk management software or Infrastructure project management software
can give all stakeholders the transparency required. Planning a
realistic acquisition program allows all stakeholders to fully
investigate all the options. Once these are clear, you can take a
logical approach that accounts for emerging technology and changing
economic times.

Guide to Managing Construction Projects

In this guide to managing construction projects we cover the technical skills along with the deployment of construction project management software to keep projects on track.

This
guide to managing construction projects also includes best practice
tips to help avoid pitfalls on construction projects. It provides
specific advice to help complete a construction project with success.

 

Construction project phases

Construction
projects have clear phases within their lifecycles – concept, planning,
implementation, control and close out. These give guidance on how to
get things done on budget and on time. Skipping any will likely mean
your project is running out of control.

This will include setting up the project phases and defining deliverables for each milestone.

Most projects that follow best practice use the following main phases:

1. Conception.
   Before you plan anything investigate the feasibility of the project.
   Complete a project feasibility report. This should include costs,
   deliverables, timelines, and how and why it will be done.
2. Planning.
   Once the project has the go ahead with scope, budgets and timelines
   set, start planning how to achieve each phase. Complete a work breakdown
   structure for each part of the construction project. Allocate resources
   and setup a schedule in construction project management software. Make
   sure to include every last task with timelines and costs assigned.
3. Implementation.
   Implementation begins when people actually start the physical work.
   This is when the construction of the building occurs. You need to keep
   on top of:
   1. Time management. Keep track of time. Use the schedule to compare estimated times to finish against actual completion times.
   2. Managing
      costs. You should already have estimated costs against each task in the
      schedule. Add in actual costs on completion of each task.
   3. Managing
      quality. Quality management is vital for the quality of the end
      product. Without processes and procedures to ensure the quality of every
      aspect of the build, there is no way to maintain a quality build.
   4. Managing
      change. Good processes for change management make changes simple to
      execute. Construction management software can manage the change process
      for you. This makes it simple for all stakeholders to access with
      transparency.
   5. Managing risks. Risks should
      already be logged into a risk register. Keep a close eye on these so
      you can mitigate them before they occur.
4. Keeping
   control. Keeping control is really part of implementation. It is all
   about staying on top of the costs, risks and meeting timelines to get
   those milestone payments.
5. Project close
   out. Wrapping it up is an important part of the construction project
   process. To close out a project write a report, address any outstanding
   issues, file any administrative paperwork for completion and
   redistribute resources no longer required on the project.

 

Setting up roles and management systems

All
construction projects have clear roles with responsibilities assigned,
along with management systems to make everyone accountable. It is
important for the success of a project that there are clear leaders with
good communications skills to lead the construction team.

Assign
roles and responsibilities to team members with matching skills. Take
advantage of people’s key strengths to get the best outcomes.

 

Managing quality assurance

How
do you manage quality assurance? This takes knowledge of legislation
and regulations. You also need to know how to set up processes to
maintain quality assurance during each project phase. Construction
projects have to meet many standards. Missing anything can mean
expensive repairs after completion. And, a loss of your reputation.

 

Tracking and identifying variances

Tracking is vital to any construction project. It allows for the identification and resolution of project variances. Using construction project software
can take care of everything you need. Reports, cost overruns schedule
slippages can all be identified and reported on automatically. You need
ways of measuring the performance of the project that you can apply to
the work breakdown structure and any other parts of the work. Examples
of measurements you can use include:

• Budgeted cost of work. This is the scheduled cost in the budget for the scheduled work.
• Actual cost of work. This is the cost of work completed at any time according to the organization’s accounting system.
• Budgeted cost of work performed. This is the earned value of the completed work at any nominated time.
• Estimated
  cost at completion. This is the expected cost to complete the
  construction project calculated at any given point in a project.

By
using the work breakdown structure as the basis for project tracking it
helps to establish a project baseline. This gives you something to
measure against.

These
best practices are interrelated. By missing any of these, your project
will run into trouble. With the complexity of managing construction
projects, project managers need all the tools available. Construction project management software
makes it easy to track projects with transparency. It also helps when
dealing with the change process and alerting to potential risks all in a
central database. We hope you enjoyed reading this guide to managing
construction projects. 






Guide to Managing Construction Projects | Construction Project Management Software - Raptorpm: managing construction projects

Construction Project Management Document Control

Construction Project Management Document Control  Construction project management document

control.

Construction project management document control is
about managing technical, contracts, manuals, plans and design
documents. It also sets out the document control procedures across the
construction project. So, a construction project management document
control solution should make it easy, to mange, access, and share key
project documents throughout your organization.

 The
days of storing construction project documents in filing cabinets are
long gone. With any construction project management software it should
be easy to digitize your documents to store  in the cloud for access by
anyone from anywhere with a internet enabled device.

Documentation
control is the backbone in construction management. You need to have
this under control to achieve successful construction project delivery.
Improving construction project management document control and workflow
ensures you deliver your projects on time. As the complexity of projects
grow, you need better transparency for tracking a project’s progress
during construction.

Using some flavor of
construction project management software means all users can share
important documents. All relevant stakeholders can access the relevant
information the minute someone updates it. This avoids costly mistakes.

Improving
document control in project management gives everyone easy access to
relevant parts of the project. This eliminates the need to manually
update document systems and communicate changes personally. Needing to
constantly communicate workflows and updating paperwork is stressful and
time consuming. Law of averages says there is likely to be human error
that can lead to mistakes, delays and missed milestones.

Integrating
construction project management software for document control into your
system means it can share the information everyone needs in a timely
manner.

When workflows improve across the whole
project, it will run smoothly to construction project delivery. Consider
the different areas a project relies on updated information to keep the
it on track.

 

Job site and office intercommunication

Communication
between the job site and the office is critical. No more can you rely
on a pad or clipboard and a pen to record information. The old days of
handwritten notes recorded in the system at the end of the week comes
with huge risks. Risks of bottlenecks, delays and mistakes. It may be
too late when updated project drawings arrive at the end of the week
making changes.

The old way disconnects the
construction site with the office. Using handheld devices and a
construction management software package, workflows will improve. An
onsite foreman can document his reports, capture employee information
and take photos in real-time. This gives the office daily progress
updates and notification of any problems. The office can upload change
orders, RFIs, updated plans and new schedules. Work flows better with a
real-time exchange of information keeping everyone information flowing.

 

General and subcontractor communication

Construction
project management document control takes the pain out of waiting for
updated information. Subcontractors often have to wait for approvals and
other paperwork from the general contractor. This can delay their work
on the job. How much do these types of delays cost your business?

Construction
management software all documentation in a central database. This is a
record of all correspondence between everyone involved with the project.
Subcontractors can access the system for the paperwork they need
instead of chasing the general contractor. No more frustration or
delays. It helps to keep your project progressing to project delivery.

 

Project manager and accounting department communication

With
work flowing well in other project areas, take a look at the work
system between the project manager and accounting. Things like needing
to enter employee times into the system for payment is time-consuming
for a manager. Project management software can deal with this. Employees
log on and log off the system from a remote handheld device.

When determining construction project controls
and project costs, can you access the information you need? Without
good work processes and procedures, you will need to request information
from accounting. This is time-consuming both for you and accounting
staff. Integrating construction management software with accounting
gives access to real-time information. No more disturbing other staff
members to get the information you need. You can look it up yourself. It
saves a lot of time and frustration.

Saves time and reduces risks

As
the complexity of construction projects grow, manual systems no longer
cut it. Keeping up with phone calls, emails, paperwork and staff demands
takes up valuable time. It reduces productivity and stress levels rise.
Instead of working on mitigating risks, you are likely to make mistakes
trying to keep up with the document trail.

According
to the KPMG 2016 Global Construction Survey 67 percent of all
participants said construction project risks were rising. This figure
rose to 78 percent when related to construction and engineering
organisations. This shows the construction industry needs to find a
better way to handle the complexity of projects to mitigate the risks of
failure and delays.

Technology is the key. But the
construction industry is slow to adopt new technology. Maybe because
decision-makers have trouble seeing the value construction project
management software brings.

Manual systems reduce
your productivity. Instead of being out on the job site, it confines you
to the office. Spend time investigating the best construction project management software.
With more time on your hands you can spend it on site, working on
higher-level tasks to mitigate the risks. Get your documents and work
flows organized with construction project management document control.