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Vol. 2011-02 | February, 2011

Effective Management of Construction

Building and renovation projects have been frequently referred to in terms of human investment as: “Time, Emotion. and Money”. Effective business management of costs, quality and time constraints on construction and renovation projects however, also requires attention, experience and professional construction skills, in order to assure the highest level of attainable goals successfully, and with a minimum of emotion.

Basic management techniques employed should include legal principles, budget and time constraints, planning and feasibility studies, programming, development of design criteria, preparation of well-defined construction documents, bid and contract negotiations, and administration of construction contracts through the complex processes, until completion and occupancy.

The essential stages of any project should include:

  • Feasibility. Review zoning, density, site quality, ascertain site is environmentally “clean”.
  • Detailed design manual. Consider efficacy of design-build or negotiated contract.
  • Prepare budget, set time constraints, arrange financing.
  • Interview Architects and Engineers; consider “partnering”.
  • Interview construction managers; consider “partnering”.
  • Review construction documents and budget.
  • Negotiate contracts, or advertise for and receive competitive bids, with bid bonds, performance bonds, insurance certificates, etc.
  • Review bids, award contracts in writing.
  • Administer contracts, construction, payments.
  • Punch List regularly, and before beneficial occupancy or final acceptance.
  • Receive guarantees, warrantees, Owner’s Manuals.
  • Final payment, and tenant occupancy, conditioned upon lien releases, final title search for liens.
  • Reductions in price may be achieved only with better risk allocation. Punitive damage clauses in construction documents have a corollary; namely, that such clauses will only encourage contractors and suppliers to insulate their bids with higher prices to dampen the risk.

Preliminary planning and estimates of cost, time and quality, provide the guidelines as a roadmap for better projects, through controlled and monitored budgets, economic and physical feasibility, better defined project scope, timing, and the initiation of project management. Above all, never assume that the Architect, Engineer, Contractor, Subcontractor, or Supplier will perform services, or supply anything not specifically required and expressly stated in their contracts, whether done gratuitously, or for sums certain!

Certain early warning signs must be recognized and addressed immediately, including program “creep”, building “footprint” or configuration, exterior materials or cladding, interior finishes, and other methods and materials of construction.

Project delays seriously affect costs and may result in uncontrolled overruns, unless subject to review and control. Hidden costs, “extras”, delays in access to site and storage areas, Owner and/or governmental approvals, etc. are among a few of the other issues seriously affecting final costs, quality and time constraints as well.

Construction project management is business management – administration of highly technical and critical masses comprising the construction process. The guidance of experienced professionals may prove invaluable to the Owner with the objective of effecting delivery of quality projects, within budget, on time, and with a minimum of emotion.

“Justice is my being allowed to do whatever I like. Injustice is whatever prevents my doing so.”
Samuel Butler (1835-1902) English author

AUTHOR / EDITOR: J. NORMAN STARK is an Attorney-at-Law, a Registered Architect, (AIA, NCARB) Registered Landscape Architect, Interior Designer, Planner and Senior Appraiser (ASA), admitted to practice law before the Bar of Ohio, the US District Courts, Ohio and Illinois (Central Dist.), the US Court of Appeals, and the United States Supreme Court. He is a Mediator, Arbitrator and Litigator with experience in Business, Construction Law, and Public Works, and with additional experience in Real Estate, Construction Attorney (Legal Project and Crisis Management), and as an Expert Witness (Forensic Architect). His office is in Cleveland, Ohio.