Challenges to Project Management in Construction

Management Summative Assignment no 1

By Aivaras Symanas

Introduction

This work uses Dreadnought project as a vehicle for discussion for challenges and of project management in construction as well as examining risk management strategy, particularly focusing upon the issues that arise from  ….

Challenges to Construction Project Management

The complexity of clients’ demands, together with the increasing complexity of the construction industry, particularly as a result of technological developments, has over the years resulted in specialisation within the industry. Variety of professions have developed as separate skills (e.g. Architecture, Quantity Surveying, M&E Engineering etc.) and even on a small project all of those skills are involved. The key to the management of construction projects is therefore the way in which the contributors are organised so that their skills are used in the right manner and at the right time for the maximum benefit to the client. There is little point in the construction industry developing its skills if they are not then implemented effectively.(Walker, 2002)

• Scenario issues

In addition to the professions already mentioned, every construction project involves many of the following additional stakeholders: Multiple regulatory bodies, local residents, statutory undertakers, end users etc. Internal and external stakeholders would be involved in different stages of the project. Early and comprehensive stakeholder identification and analysis, together with regular monitoring and updating, is necessary in order to deal successfully with all stakeholders and defuse many possible project obstacles. (Guerin, 2012)

Successful Construction Project Management

A project may be considered as successful if the building is delivered at the right time, at the appropriate price and quality standards, and delivers the client with a high level of satisfaction. (Naoum & Langford, 1989). Effective project management seeks to make sure that these objectives are achieved, but nonetheless, completing large construction projects on time and on budget depends on a high degree of synchronization among many stakeholders which requires the entire team to work in collaboration. The need for collaboration arise and are depended on level of uncertainty, interdependence and complexity of the project.

Issues with construction industry and its link with collaboration was recognized in the Latham Report (‘Constructing the Team’) in 1994, and again reinforced by the Egan Report in 1998 (Rethinking Construction)(Gardiner, 2014) .It is fair to say, that collaboration is even more needed in today’s industry with its complex chain of supply and introduction of specialist subcontractors and supplier design. Effective collaboration is one of the tools to ensure that stakeholders can accomplish the complex sequence of interconnected tasks on time.

Tools to achieve collaboration??

• Decision making

Iron Triangle

As mentioned earlier, time cost and quality, also known as iron triangle, is often associated with project success, finding a perfect balance between them, or identifying the priorities of key elements could play a big role of project management.

Lawrence Miles developed methodology called value engineering which is used to solve problems and identify and eliminate unwanted costs, while improving function and quality. In construction this involves considering the availability of materials , construction methods , transportation issues, site limitations or restrictions, planning and organisation, costs, profits and so on.

Knowledge

Dreadnought project involves major refurbishment works, as well as replacement of existing services. According to (Koehn & Tower, 1982) refurbishment work demands even greater supervision than new build work, given the increase in labour, together with a corresponding increase in fragmented specialized work and the difficulties associated with unforeseen challenges such as asbestos findings in demolition stage. The high level of uncertainty in refurbishment projects tends to lead to project over-run. The ability of project manager to cope with unexpected change and/or conflicts are necessary as well as knowledge associated with the analysis of project risks. (Smyth & Pryke, 2008)

Provision of a Risk Management Strategy

Risk Management is a particular form of decision making within project management, these decisions are made against a predetermined set of objectives, rules or priorities based upon knowledge, data and information relevant to the issue. (J.Smith, et al., 2009). Nevertheless, it is not possible to have all relevant information on time, or conditions of total certainty and in some cases decisions are ill-founded, not based on a logical assessment of project specific criteria and lead to difficulties later. (J.Smith, et al., 2009). Dreadnought project was intended to be open by 2016, but due…………………….kas nutiko ?……… the main contractor was liquidated.

In construction projects each of the three primary targets of iron triangle will be likely to be subject to risk and uncertainty. It follows that a realistic estimate is one which makes appropriate allowances for all those risk and uncertainties which can be anticipated from experience and foresight. Project managers should undertake or propose actions which eliminate the risks they occur, or reduce the effects of risk or uncertainty and make provision for them if they occur when this is possible and cost effective. (J.Smith, et al., 2009).

Most commonly, the Client has an overall risk management strategy and policy included in the strategic documents and quality management systems. Main issues concerning project owner risk strategy are risk ownership (which party owns the risk; risk exposure and transfer) and risk financing (how to include and use budget risk allowance or contingency). Project planning methods should be utilized to communicate to all parties in a project, to identify sequences of activities and to draw attention to potential problem areas. The successful realization of a project will depend greatly on careful planning and continuous monitoring and updating. Sequences of activities will be defined and linked on a timescale to ensure that priorities are identified and that efficient use is made of expensive and/or scarce resources. The purpose of planning are therefore to persuade people to perform tasks before they delay the operations of other groups pf people, and in such a sequence that the best use is made of available resources and to provide a framework for decision making in the event of change. Project management information systems (PMISs) should forecast the outcome of a project in terms related to achievement of its objectives. Integrated cost models link time with money. They provide project managers with forecasts to completion in terms of cost, time resource usage and cash flow. Decision about future actions can be made with the best available forecasts in these terms. Cost models also help to overcome an implementation gap between monitoring systems and the manager’s action. Risk management software (RMS) is the term used to denote a specialist software, which can be used to apply on of the many risk assessment methodologies (e.g. Origami, Procore)

It is well known fact that managing risk has two major objectives; to avoid the downside risks and to exploit opportunities. And very often, the latter has been neglected, as the former has much more to do with securing your project objectives, which for many organizations is priority. But on the hand, the major leaps in project cost and time reduction are results of innovative thinking with focus on exploring opportunities by challenging the risks. The trend today is to establish ambitious goals, to seek for new technological solutions and concepts and to look for effective ways of organizing and managing projects (J.Smith, et al., 2009)

To achieve these aims it is suggested that a systematic approach is followed: to identify the risk sources, to quantify their effects, to develop management responses to risk and finally to provide for residual risk in the projects estimates. These four stages comprise the core of the process of risk management. Risk Management can be one of the most creative task of project management. (J.Smith, et al., 2009)

Contingency

Conclusion

Conclude & recommend – there are specific parts to the question, however, there may be a variety of options, it is useful to appraise these before you conclude; the conclusion should re-iterate, this may be subjective, & if a balanced view is stated, this cannot be wrong, however – there must be a conclusion

Word count (excluding References) – 2000

Guerin, D. M., 2012. Project Management in the Construction Industry, Massachusetts: Brandeis University.

J.Smith, N., Merna, T. & Jobling, P., 2009. Managing Risk in Construction Projects. 2nd ed. Oxford: Blackwell Publishing.

Koehn, E. & Tower, S., 1982. Current aspects of construction rehabilitation.. ASCE, 108(C02), pp. 330-340.

Naoum, S. & Langford, D., 1989. An investigation into the performance of management contracts and traditional method of building procurement. s.l.:Brunel University School of Engineering and Design PhD Theses.

Smyth, H. & Pryke, S., 2008. Collaborative Relationships in Construction. Oxford: Blackwell Publishing Ltd.

Walker, A., 2002. Project Management In Construction. 4th ed. Oxford: Blackwell Science Ltd.