Contractual Pitfalls In Project Management Within Construction Industry.

Online, August 20, 2012 (Newswire.com) - Project management began in its early form in the late 19th century, driven by large scale government projects. After WW2 specific techniques emerged for planning and managing huge budgets and workforce. With the advent of computers the project management tools became easier to use, more suitable for smaller (although still large) projects and different disciplines. In the modern times, project management is widely used on projects of all sizes and complexity.

Despite such long tradition, even nowadays many projects do not meet their required performance standards or are delivered late or over budget.

Managing a project within the construction industry is seen as a priority in adding significant value to the building process. Having that systematic application towards management principles will assist the entire quality of the project and evidently ensures the process runs smoothly. The role of a project manager can be applicable to all projects no matter how small. This role can be effectively entwined with another e.g. head architect or construction foreman. Applying this method to construction works, not only improves the quality of the project but the work flow also improves due to members of the team being fully engrossed in the work project, thus achieving a qualitative result.

In a recent seminar, a Cheltenham-based firm of solicitors addressed the typical contractual pitfalls to watch out for within project organisation in our industry.

High on the list of potential culprits were Letters of Intent. Whether binding or non-binding, Letters of Intent must be drafted carefully in terms of what the parties want to achieve by using them. Ultimately their objective is to first achieve agreement on what needs to be done, and start work later. This prevents many issues from arising at a later stage.

Also of great importance is having the right procurement strategy, because each project is different and it is critical to balance out risks against project objectives, by assessing what the drivers are for both.

Other important points to consider are financing (getting the bank on board early, before contracts/appointments have been agreed) and conflicting terms and conditions of the parties involved (resolve any conflicts early on and not just assume that one set of Terms and conditions will override another, because there is no automatic hierarchy). Choosing the right project manager for your construction process, one who has attained the required competencies at the correct level for your specific project is vital to the running of the project. Looking at their previous projects and the outcomes of them will also provide a good indicator as to where they can take your building construction. All in all, project managers act as a co-ordinator, mediator, facilitator and contract administrator for the course of the project. They will be the central communication of among designer, contractor and owner. It is in their responsibility to protect the interest of each project team member specifically the owner of the project.

Ultimately, by raising the standards of project management within the construction industry and more specifically improving the skills of project managers, all parties can enjoy a smoother process and therefore gain better results. Please contact us if you have any queries about the Project Management work we undertake here at Nick Bevan Consulting.