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Need of Construction Project Management

need for construction project management

Construction Project Management:

Construction project management is the art of tying together various construction tasks, such as planning, organizing, staffing, scheduling, supervising, budgeting, controlling, and closing, while meeting the project specifications. To help project managers make key decisions, construction managers use a number of project management tools. Communication, including project management meetings, is also essential because it keeps everyone on the same page.

State of Construction 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 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, the 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 a huge percentage of wastage of the invested money and time.

For example, in the US every 1 billion dollars invested 122 million dollars gets wasted. These failures can be attributed to the challenging nature of this industry.

Another stark example can be seen in China: many construction projects are slowed down considerably due to government anti-corruption efforts. According to China Construction Bank, 15 of 26 of China’s top 100 listed companies, including Fosun Group, China Railway Group, China National Machinery Industry Corporation, China Southern Power Grid, and Sinopec, have suffered from asset impairment. The government is trying to tighten control over the investment industry and impose stricter capital controls.

The challenges faced in construction industry:

  • Hyper-competition
  • 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 for “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 recognized in every project during the early development as well as during design and construction which can turn the project successful.

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