Need for Construction Project Management in the Industry
The construction industry is the largest industry in the world. Growth in this industry is an indicator of the economic conditions of a country. This is because the construction industry consumes a wide employment circle of labour.
It is more of a service industry than a manufacturing industry. While the manufacturing industry exhibits high-quality products, timeliness of service delivery, reasonable cost of service, and low failure rates the construction industry is generally the opposite.
Most of the projects exhibit cost overruns, time extensions, and conflicts among parties.
Example of a magnificent project that suffered from huge cost overruns: Sydney Opera House costed about 14 times more than what was initially planned.
The construction industry is more challenging than other industries due to its unique nature. Every project is one of a kind and conflicting parties are always involved.
Thus, a project is defined whether it is in construction or not by the following characteristics:
- A defined goal and objective
- Specific tasks to be performed
- A defined beginning and end
- Resources being consumed
The goal of construction projects is to build something. What differentiates the construction industry from other industries is that it its projects are large, built on site and generally unique. It requires money, labour, equipment and materials as well to complete. In spite of being one of the major economic indicators of a country, construction industry has long been criticized for the poor performance with respect to many projects failing and or not meeting the expectations. This lack of performance leads to huge percentage of wastage of the invested money and time.
For example in the US every 1 billion dollar invested 122 million dollar gets wasted. These failures can be attributed to the challenging nature of this industry.
The challenges faced are:
- Every project is unique
- Involvement of many contracting parties
- High risk involved.
To overcome these challenges every project requires clarity in overall vision, goals and objectives. The other reasons for the failures of a construction project such as:
- Inaccurate estimate due to miscalculation, specification errors, omissions, excluded permits and changing market conditions.
- Scope creep, i.e, the amount of work grows beyond the original agreement.
- Unreliable and unskilled labour
- Unclear specifications
- Communication gap between the parties
- Financing issues
- Improper planning
This shows that unsophisticated strategic planning makes it difficult in making accurate market predictions and then leads to the project failure. here comes the need of “Construction Project Management” which is defined as “an art and science of coordinating people, equipment, materials, money and schedule to complete a specified project on time and within approved cost”
One of the most important principles of construction project management is the necessary balance between scope, budget and schedule without compromising on quality. This should be recognised in every project during the early development as well as during design and construction which can turn the project successful.