Take Control of Your Construction Project Costs

Reduce labor costs and improve communication with an integrated construction project management solution.

The cost associated with managing labor creates a significant expense for any construction company. By implementing a project management solution, the back-office and administrative overhead can be reduced considerably and resources can be freed to work in other areas.

An effective project management solution will impact three key project areas: setup and configuration, ongoing management and reporting of what has occurred and how the project has been impacted. These three pieces can be managed from both the field and office, enabling the flow of information across the company and ensuring that all project stakeholders are informed with up-to-date information.

Improve Project Setup and Configuration

When selecting a project management solution, first consider how it can help with a project’s setup and configuration.
In traditional scenarios, a project is conceived, requirements are gathered, and information is passed to the accounting, estimating and project management teams. These teams set up the project in their own workspace, meeting their own requirements. This creates duplicated work and the potential for errors and inconsistencies between the various systems. These potential errors can have an impact on the accuracy of reports and the analysis of information collected during later stages of the project. Ultimately, this can result in cost overruns and lost profit due to missed items, inaccurate forecasts and miscommunicated requirements.

To avoid the potential for errors, a project management solution can be fully integrated with your financial accounting and estimating solutions. This allows each project to be set up and configured once, and information can be accessed across your company. The setup and configuration occurs from a single point of entry, whether it is the accounting, project management or estimating team. Each team can add elements to the project with the information assimilated into the project file and distributed to the other teams, ensuring that all parties are aware of the latest project status, changes made and the impact to the overall budgeted and actual costs.

This is essential for accurate project tracking and reporting. With incomplete information, labor and other costs cannot be managed during execution.  Since an integrated solution centralizes project setup and configuration, it mitigates any risks of beginning a project with inaccurate and incomplete information. It also simplifies processes by minimizing the number of people involved in each step and avoiding unnecessary overhead before work even begins.

Manage Activities and Expenses

With accurate project setup and configuration, project managers and stakeholders can focus on managing the activities and costs incurred during the project execution.

Maintaining an accurate account of labor time and equipment use is especially important during project execution. A fully integrated project management solution tracks labor hours and costs directly into the system. Time entry and labor coding can be reviewed to verify that labor is recorded accurately and billed at the correct rate against the correct accounts. With an integrated solution, project managers and the accounting staff can conduct these reviews.

Capturing and recording changes to the project scope is also important. When change orders are issued, from the field or office, a fully integrated solution guarantees that the information is available to all project stakeholders, and necessary changes to labor forecasts are updated to allow for accurate expense tracking. Labor overages can also be monitored and examined to identify possible change order sources that may have been missed, which could negatively impact the project’s profitability.

This dynamic communication ensures that all parties involved in the project are working from the same information. An effective solution will alert project stakeholders with information that requires review, such as new submittals and meeting minutes. By automating the communication between the field and office, billing and payroll transactions can be completed in a timely and efficient manner.

Generate Project Reports and Identify Trends

Generating relevant project reports start with data captured from a single point of entry. With an integrated project management solution, data is entered once and becomes available across the company, which results in accurate and timely information and duplicated work is avoided. The seamless flow of data allows the most pertinent information to be captured at any time

With accurate information from a single point of entry, a project’s status can be evaluated and improved forecasts can be made. Working from an accurate forecast allows project managers to more efficiently manage the labor required, equipment and materials involved and the associated costs. This often means the difference between successfully completing a project within budget and finishing a project late and over budget.

Trends can also be identified that may impact the work crews’ productivity and the project’s profitability. If necessary, the workers and equipment can be adjusted to account for what is actually occurring in the field to keep the project under control.

Gain Control

Effective project management solutions facilitate the flow of communication and ensure that all project stakeholders, both in the field and in the office, are working from the same information.
By ensuring that information is shared immediately across the company, the solution opens communication channels of communication and allows for the automation of processes that increase accuracy and reduce risk. The end result is a well-informed project team that can manage costs with detailed and accurate information.

Construction business Owner, June 2011