What Is Construction Project Management (CPM)?
Construction project management refers to the processes needed to successfully complete a construction project. Construction project managers ensure that all elements of a construction project are supported and executed efficiently throughout the project lifecycle.
At its most fundamental level, construction project management handles the coordination, execution, and planning of a construction project, whether it’s agricultural, residential, commercial, institutional, industrial, heavy civil, or environmental.
Construction project management typically includes complicated tasks that can shift wildly, depending on the work at hand, and it requires strong skills in communication, deep knowledge of the building process, and the ability to problem-solve. Construction project management is a complex field, requiring knowledge in many different areas like finance, mediation, law, business, and more.
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History of Construction Management
Construction managers have played an important role since the rise of complex building projects. In early construction projects, an architect oversaw operations, but over time the manager role has gradually become more specialized, and more complex.
Into the Renaissance, individual architects began to be known for their designs, like Sir Christopher Wren of England. Wren designed and built buildings in the late 17th and early 18th centuries, including the masterpiece St. Paul’s Cathedral, that help give London its rich countenance. Wren had a breadth of knowledge that would foreshadow the types of skills needed on a complicated construction project, with expertise in advanced mathematics and physics, as well as in design. He was on his building sites every day overseeing every phase of the works.
The rules of project management began to take shape across corporate America around the time of World War II, and by the 1950s, they were guiding civil construction projects. This meant that the phases and tenets of managing a construction engineering project were now being applied to a variety of corporate projects.
More and more details of managing a construction project can be done digitally (see software section below), and that trend is expected to grow. Mobile-friendly technology and software are set to play a major role in the field, as a younger workforce is more comfortable with the technology, and it will allow the work to be managed and tracked from anywhere.
Roles of Construction Manager and Contractor
Construction managers and contractors play key roles in project execution. Construction managers coordinate and oversee building work, and also ensure participants adhere to budgets and schedules. Contractors work closely with construction managers and are responsible for the hands-on construction work.
To learn more about this role, read our comprehensive guide to commercial construction management.
First up in any construction project is the design phase, and when that’s finished, the construction project manager opens the bidding process to interested contractors. To qualify for consideration, contractors must be able to show they can handle public safety; decision-making, engineering, drafting, human resources, and time, cost, and quality management. The contractors who meet these guidelines are then chosen through low-bid selection, best-value selection, or qualifications-based selection — all common measures.
The Construction Project Bid Selection Process
In the project bid selection process, the project owner first shares information to a large group of contractors, and then solicits bids from them. Once the project owner selects a bid, both parties agree on a payment model.
Types of Construction Project Bids
A contractor can expect two kinds of bids:
- Open Bid: Open bids apply to public projects and are usually advertised. With an open bid, any contractor can put in an offer.
- Closed Bid: The process for a private project starts with a closed bid, wherein the owner invites a select group of contractors to send in their bids.
Methods of Construction Project Bid Selection
Whether the owner chooses an open or a closed bid process for the project, the bids will then come in, and the selection of a contractor can commence based on a number of criteria:
- Low-Bid Selection: The bottom line — aka the price — is the main focus for the project owner. The winning contractor is the one who submits the lowest price for the project.
- Qualifications-Based Selection: In this process, the project owner asks contractors to submit with their bid a request for qualifications (RFQ), which summarizes the contractor’s experience, plans for management, organizational flow, and success in staying on budget and on schedule. The project owner then chooses the contractor with the best qualifications.
- Best-Value Selection: In this approach, the project owner considers both the bid price and the contractor’s qualifications to find the best combination of cost and skill set.
Types of Construction Project Payment Models
The next and final step after an owner chooses a contractor is to negotiate a payment agreement. Both parties typically select from four payment models:
- Lump Sum: A lump-sum contract is the most prevalent choice. The project owner and the contractor come together on the overall cost for the work, and the owner must pay that amount, regardless of the project’s success or if the final bill surpasses the initial quoted price.
- Cost-Plus-Fee: As the name suggests, cost-plus-fee includes the total cost of the project as well as a fixed fee percentage of the overall cost to the contractor, all of which the owner must pay. This is the most contractor-friendly arrangement, since it covers all additional costs.
- Guaranteed Maximum Price: With a guaranteed maximum price contract, the owner and contractor agree on a set price that the total cost and fee cannot exceed.
- Unit Price: If the two parties can’t agree on the cost ahead of time, they opt for a unit-price model, in which the owner pays out a specific unit price throughout each phase of the project.
The Construction Management At-Risk Delivery Method
Construction Management at Risk (CMAR) is a delivery method wherein the construction manager completes a project for a guaranteed maximum price (GMP). The manager helps set the GMP during development and design, and is then liable for any additional costs.
In addition to acting in the owner's interest, the construction manager must control construction costs to stay within the GMP. Because the arrangement guarantees a maximum payment, low bids are typically not considered. Instead, the construction manager will work toward fulfilling the financial goal through other avenues.
The advantage of a CM at-risk arrangement is budget management. Before a project's design is completed (six to 18 months of coordination between designer and owner), the construction manager is involved with estimating the cost of constructing a project based on the goals of the designer and owner (design concept) and the project's scope, all while achieving optimal quality. The construction manager will have to be ready for potential changes to balance the costs, schedule, quality, and scope of the project while still meeting the financial goals.
For example, instead of a redesign, the construction manager may suggest modifications instead. Or if the owner decides to expand the project, the team will have to make adjustments before pricing. To keep a handle on the budget before design is complete and construction crews are called up, the construction manager conducts site visits and purchases major items ahead of demand.
Advantages: In this arrangement, the construction manager assumes the risk, so he or she has an incentive to act in the owner's interest and to efficiently manage costs, considering GMP overruns would be the responsibility of the manager’s company.
Drawbacks: A cost overrun could cost the construction manager a great deal of money. The CM is allowed some mistake-related contingency, so there is a possibility that they will compensate by reducing the scope of the work to fit the GMP. Also, since the GMP is decided before design begins, it is difficult for owners to know whether they received the best possible bid.
Bottom Line: An at-risk delivery method is best for large projects — both complete construction and renovation — that are not easy to define, have a possibility of changing in scope, or must meet strict schedule deadlines. It can also be an efficient method in projects containing technical complexity, multitrade coordination, or multiple phases.
Accelerated Construction Techniques: Starting with its Accelerated Bridge Program in the late 2000s, the Massachusetts Department of Transportation began employing accelerated construction techniques, in which it signs contracts with incentives for early completion and penalties for late completion, and uses intense construction during longer periods of complete closure to shorten the overall project duration and reduce cost. The federal and California Departments of Transportation also employed this technique after the Northridge earthquake in 1994 to speed up repair of freeways in the Los Angeles area.
Contract and Design Models for Construction Projects
The bidding process is usually consistent no matter the type of construction project, but you can expect two business models in the construction industry:
- Design-Bid-Build Contracts: Both popular and prevalent, design-bid-build contracts allow the owner to choose a contractor after an architect or engineer completes the design phase.
- Design-Build Contracts: The opposite of design-bid-build, in a design-build contract, the design and construction phases are handled by the same party (referred to as the design-builder or the design-build contractor). This approach speeds up the project’s completion since the design and construction phases can happen simultaneously.
As noted in the two above models, the bidding process begins with the design phase. The design stage itself can be broken down into different approaches.
- Conceptual/Programming and Feasibility: This model uses the final vision of the building as the starting point to determine needs, goals, and objectives. Considerations include the building size, the number of rooms, how the space will be used, and even who will be using the space. This information is generally captured in a spreadsheet listing each room, the critical information about those spaces, and the approximate square footage of each area.
- Schematic Design: Schematic designs are drawings or sketches used to identify spaces, shapes, and patterns. Not every part of a construction project can be sketched, of course, but those that can be are in this type of design. The drawings note materials, colors, and textures. These sketches can also capture floorplans, where structures like elevators will be placed, and so on.
The 5 Phases of Construction Project Management
The five phases of the construction management process reflect those in traditional PM: project initiation, planning, execution, monitoring, and, once the team meets all completion goals, project closeout.
1. Initiation
Before the project starts, a project manager must develop and evaluate the business case to determine if the project is feasible and worth undertaking. Stakeholders may be asked to do their due diligence and to conduct feasibility testing, if needed. When all parties agree to proceed with the project, the project manager writes a project charter or project initiation document (PID), which includes both the business needs and the business case.
2. Planning
Next, the project team develops a road map for all involved. This includes the project management plan (PMP), a formal, approved document created by the project manager to guide execution and control, as well as set baselines for scope, cost, and schedule. You can also expect to see these documents in the planning phase:
- Scope statement and scope documentation: This defines the project’s business need, benefits, objectives, deliverables, and key milestones.
Work breakdown structure: The work breakdown structure breaks down the scope of the project into visual, manageable chunks.
Communication plan: This outlines all aspects of communication, from goals and objectives to roles to tools and methods. The communication plan creates a common framework that everyone can work from to avoid misunderstandings or conflict.
Risk management plan: This helps project managers identify risks beforehand, including time and cost estimates that may not be met, potential budget cuts, shifting requirements, and a shortage of committed resources.
3. Execution
Now the work begins. Typically, all parties hold a kickoff meeting, then the project team begins the crucial work of assigning resources, implementing project management plans, setting up tracking systems, completing tasks, updating the project schedule, and if necessary, modifying the project plan.
4. Performance and Monitoring
The monitoring phase often happens concurrently with the execution phase. This phase is necessary to measure progress and performance and to ensure that items are in line with the overall project management plan.
5. Closure
This final phase marks the project’s completion. To mark the conclusion, project managers may hold a post-mortem meeting to discuss what parts of the project did and didn’t meet objectives. The project team then creates a punch list of any lingering tasks, performs a final budget, and issues a project report.
Expert Tips for New Construction Project Managers
Managing construction projects can feel daunting for new managers. From getting hands-on experience and encouraging communication to committing to ongoing education, we’ve gathered some of the best advice from experts in the field.
Here are some top tips from six construction management experts:
"Passez du temps sur le chantier à observer le travail en cours et à poser beaucoup de questions. Sortez sur le terrain, salissez vos bottes et montrez du respect aux métiers qui font réellement le travail de construction des projets. Il est important que l'entrée- les CM de niveau comprennent les nombreux éléments de terrain, tels que la météo, les conditions du site, l'espace de stockage limité, la congestion du trafic, etc., qui peuvent avoir un impact sur les coûts, le calendrier, la qualité, la sécurité et les autres variables du projet que les CM sont responsables de la gestion.
— Barbara Jackson, auteure de Construction Management Jumpstart et directrice de la Franklin L. Burns School of Real Estate & Construction Management.
« Gardez la communication fluide. Les mauvaises nouvelles sont tout aussi importantes que les bonnes nouvelles. S'assurer que toutes les parties prenantes du projet sont au courant de ce qui se passe au travail minimisera les appels téléphoniques, les e-mails et les conférences téléphoniques au milieu d'une tentative de résolution ou de récupération d'un problème sur site.
— Dan Julien, directeur de Julien Management, consultant en construction et en gestion de projet pour certaines des plus grandes marques et des personnalités de premier plan.
"Engagez-vous dans une formation continue. L'industrie de la construction est en pleine mutation - les coûts, les systèmes de réalisation de projets, la technologie, la démographie et peut-être le plus important, les attentes en matière de durabilité ("verte"), ont tous un impact sur la manière dont les projets sont conçus, construits, gérés et financés. Les CM qui réussissent sont agiles et informés et comprennent les implications de ces nombreux changements. L'ancienne façon de faire les choses est en train de disparaître ; se tenir au courant de tout, des normes et codes aux pratiques de construction, en passant par la réalisation de projets collaboratifs, etc. sera requis."
— Alison Dykstra, AIA, fondatrice de Kirshner Books et auteure de Construction Project Management : A Complete Introduction et Green Construction : An Introduction to a Changing Industry.
"Dans la gestion de la construction, plus nous planifions, plus nous avons de la chance et plus notre projet réussit. La planification commence avant le début du projet, y compris la sélection des meilleures méthodologies de construction, la préparation du calendrier/programme de construction et l'organisation des ressources. et une planification hebdomadaire tout au long de la vie du projet pour s'assurer que toutes les tâches sont terminées."
"La construction est une question de travail d'équipe, et une bonne communication est essentielle pour chaque chef de projet. Vous devez communiquer avec votre équipe, vos sous-traitants, vos fournisseurs, votre client, les concepteurs, les autorités locales et parfois les voisins et le public."
— Paul Netscher, auteur de deux livres sur la gestion de projets de construction, dont Success Construction Project Management.
"N'arrêtez jamais d'étudier ou d'analyser tout ce que vous voyez dans un projet. Ne tenez jamais rien pour acquis. La profession de gestion de la construction exige une attention totale, un grand engagement et d'excellentes compétences d'apprentissage et d'analyse. L'innatendu."
— Vicente Barrera, qui a deux décennies d'expérience professionnelle dans la construction industrielle et les infrastructures. Il est actuellement chef de projet pour SENER, un groupe privé d'ingénierie et de technologie.
“My biggest piece of advice: Never stop learning. That was actually one of the major reasons why we created Construction Junkie. The construction industry may still do some of the same things we've done for decades, but there's always room for improvement and things should always be improving. Just look at the advances being made in concrete right now. Concrete has been used for centuries, but now scientists are figuring out ways for it to heal its own cracks and others are engineering ways to make permeable concrete strong enough for heavy concrete. If we stop learning, progress stops with it.”
— Shane Hedmond, editor in chief of ConstructionJunkie.com
Top Construction Management Books for Beginners
We’ve collected the top construction management books to teach you how to manage contracts, avoid mistakes, and move a project through every stage of the process — whether you’re a beginner or simply looking to expand your knowledge in the field.
Construction Management JumpStart by Barbara J. Jackson
Written by an expert with over 20 years of experience as a licensed contractor, this bestselling guide provides a deep introduction into construction management basics, shares the latest techniques and tools of the trade, and includes today’s hot issues like sustainability and build information modeling (BIM). Readers will find out what it takes to be a construction manager with an aptitude quiz, learn the ins and outs of contract documentation, and build and maintain a project schedule. Learn more about Jackson's book.
Construction Project Management: A Complete Introduction by Alison Dykstra
Alison Dykstra, an architect and construction management teacher, offers an introduction to managing contracted construction projects in 25 chapters. The book walks through the early development stage through bidding, selecting a contractor, the construction itself, and closing out. She also covers frequently asked questions, like who the players are in construction and what each one does, and the link between the type of contract and how the contractor gets paid. Learn more about Dykstra's book.
Successful Construction Project Management: The Practical Guide by Paul Netscher
Geared toward construction professionals and students, this book by a construction professional provides a step-by-step guide to successfully managing a project, including a list of things not to do to avoid costly mistakes. Readers will learn about planning the project, scheduling, people, materials, quality, safety, subcontractors, contracts, finance, and more. Learn more about Netscher's book.
The Management of Construction: A Project Lifecycle Approach by F. Lawrence Bennett
This 2003 book introduces all aspects of construction management to students and professionals. It covers each stage of the construction project from conception to completion, design-build, and build-own-operate-transfer, and it discusses environmental issues important in 21st-century practice.
Rawlinsons Australian Construction Handbook
This massive and exhaustive reference book for the Australian construction industry is frequently updated. Now in its 35th edition, the handbook includes increased coverage of green design, sustainability, environmental management, and more.
Informative Articles on Construction Project Management
Even more valuable resources on construction project management can be found on the internet in the form of articles and reports. Here are two such documents that flesh out the role of the construction project manager in the building process.
The Risk in CM “At-Risk,” by Warner Strang
This PDF explains the pros and cons of the CM at-risk model from the owner’s and construction manager’s point of view, along with pointers on how to get the most out of the arrangement.
"What Is Construction Project Management?” by Gerardo Viera
This article breaks down the overlap between project management and construction management, outlining how knowledge of one can feed into the other.
The Stages of Construction Project Management
Construction management begins with the design stage, and then follows pre-construction and procurement. From there, the team completes construction and commissioning. Once the owner takes occupancy and ensures the building meets specifications, the project is closed out.
Here are the stages in a construction project:
1. Design
This is the first stage of a construction project, and once it is completed, it signals the beginning of the bidding process. In design-bid-build contracts, the owner chooses a contractor based on completed designs.
In this stage, an architect or engineer first assesses the feasibility of the design based on regulations and codes of the building, as well as the number of rooms, the size of the building, and the amount of space. Then he or she creates schematic designs or sketches, researching the type of equipment and materials needed and their cost.
2. Pre-Construction
The bidding process is over and the owner has chosen a contractor. The contractor is then paired with the project team, including a contract administrator, project manager, field engineer, and superintendent. Then the team gets the site ready for construction. They conduct a site examination, test soil, and identify any possible unexpected situations, like environmental challenges.
3. Procurement
The project team purchases the required equipment, materials, and labor. In other words, the procurement stage is when the team buys everything it needs to complete the project. The complexity of this stage depends on the size of the project and the company. Large national construction companies usually have procurement departments that hire labor and purchase materials for hundreds of projects at once. On the other hand, for smaller projects, the superintendent may buy limited quantities of materials from local building supplies or hire a local laborer.
4. Construction
To kick off the construction phase, the superintendent will arrange a meeting with the subcontractors and material vendors to set the ground rules for working together. Then the team must get ready to start construction, completing activities like setting up temporary storage facilities, securing the site, developing a materials and handling plan, establishing safety programs, and more. After that, the team begins construction.
5. Commissioning
Once construction is completed, the commissioning stage begins. There are two parts to the commissioning process. First, the project team must test the systems and equipment to make sure everything is working correctly before turning over the building to the owner. Then the team must train the owner’s personnel in the operation and maintenance of the systems in the new building.
6. Owner Occupancy
When the owner moves into the new building, the warranty period starts. This ensures that all the materials, equipment, and building quality meet the expectations outlined in the contract. There are two types of warranties: express warranties (written and included in the contract) and implied warranties (established or required by law).
7. Project Closeout
This final phase ties up any loose ends. The team formally completes any remaining contractual obligations to finish the project. They may create a project punch list of any tasks that didn’t get accomplished and may conduct a post-project review, document lessons learned, archive project documents, or prepare a project completion report.
How to Budget For Construction Project Management
Project managers must always think about money. From estimating budgets before the project even starts to hiring and paying contractors, financial management is one of the most important parts of a successful project.
Here’s what you need to know about money matters in construction:
1. Construction Pricing and Contracting
There are a number of options when paying contractors and outlining price in contracts. In the competitive bidding process, contractors submit their bid to work on the project. These bids are either submitted on a lump-sum or unit-price basis, whichever the owner specifies. A lump-sum bid refers to the total price of work by the contractor. Unit-price bidding is used in projects where the amount of labor and materials are uncertain.
Instead of inviting competitive bidding, some private owners choose to award contracts to one or more selected contractors with negotiated contracts, which provides more flexibility in pricing. Negotiated contracts usually require reimbursement of direct project costs plus the contractor’s fee determined by one of these methods: cost plus fixed percentage, cost plus fixed fee, cost plus variable fee, target estimate, or guaranteed maximum price or cost.
2. Cost Estimation and Budgeting
A cost estimation is prepared in order to submit a bid for a construction project and is used to establish a budget for the project once it is won. The process includes determining the cost estimates from building, unit prices and lump-sum estimates, job sites and general overhead, bidding procedures, and labor costs. Cost estimates are sometimes prepared by a professional, such as a building estimator or a chief estimator. Even though the project manager may not be the sole person responsible for cost estimation, it is still necessary that he or she become familiar with the process to understand the scope of the project.
3. Cost-Control Monitoring
As the project begins, project managers need to quickly create a process to monitor project costs. The sooner the cost-control monitoring phase begins, the faster that project managers will be able to identify trouble spots. For example, if an item is significantly more expensive than the estimate, the project manager should identify the reason for the difference and see if that cost increase affects anything else in the budget.
4. Capital Improvement Plan (CIP)
A Capital Improvement Plan (or Program) is a four- to 10-year plan that identifies capital projects and equipment purchases, provides schedule, and identifies options for financing the plan. The plan links a government entity, a strategic plan, and the entity’s annual budget. A CIP includes a list of all projects or equipment to be purchased, the projects ranked in order of preference, the plan for financing the projects, schedules for the construction phase of the project, justification of the project, and explanation of the expenses.
5. Project Accounting
The project manager and/or the agency’s accounting department will have to develop the project budget for the fiscal year, record and report expenditures, review and pay contractor invoices, and manage cash flow. From materials to labor, there are many costs in construction projects. Costs are either direct (labor, material, subcontracting, and land) or indirect (indirect labor, supervision, tools, equipment, supplies, insurance, and support costs).
The project team and the accounting department may need to work closely together to manage contractor invoices. The project team reviews invoices to make sure the work has been properly completed, then the accounting department ensures that the invoices are contractually eligible and the prices are consistent with the contract.
Organizing and Scheduling a Construction Project
It can be difficult to keep track of the necessary documents in a construction project, such as requests for proposals (RFPs), contracts, invoices, and blueprints. Because construction projects are so large and complex, efficient organization and scheduling are critical.
Organization Strategies for Construction Project Management
There are several information streams that need to be organized and managed in any construction project, from records and contract management to contract procurement planning and daily organization.
We’ve outlined some common organization strategies below:
Records Management: Record management controls the distribution, storage, and retrieval of project records, both hard copies and electronic, in a safe, secure manner. Project managers must make sure that all incoming and outgoing documents are transmitted through the records management specialist, who uses software to track the records (this method will also create a central library of all project documents and information).
Contract Management: It is important to clearly define the roles and responsibilities for the project team members who are managing the project and the project staff responsible for managing contracts and documents. The contract management plan is designed to set expectations and procedures around this by addressing who has the authority to direct and approve the contractors to work, how the contractor’s work is monitored and reported, how they are paid and approved, how contracts are modified, which financial audits are necessary, etc.
Contract Procurement Planning: Project managers also have to ensure that procurement activities fit with the construction plan. Some of the tasks they have to manage include:
- Setting expected contract price
- Creating the scope of work (SOW) for each contract
- Standardizing procurement documents and any other necessary documents
- Adding completion dates to contracts that align with the project schedule
Commissioning Plan and List: The commissioning plan and list should be started early in the design phase and continually updated as the project progresses. The commissioning plan is designed to provide direction for the commissioning process during construction; to resolve issues related to scheduling, roles, and responsibilities; and to aid in the reporting, approvals, and coordination. It is a systematic process to ensure that buildings perform according to the design and to the owner’s operational requirements.
Project Control Process: The project control process tracks and manages the scope, cost, and schedule of a construction project. The goals of this process are to establish a baseline, track performance against the baseline, forecast performance at completion and compare to the baseline, and identify changes and monitor the effects to the baseline.
Project Requirement Definition: Also known as the statement of work, this document details the project deliverables. In the project requirement definition (PRD), the project manager explains the scope of work and what the project will accomplish. It helps stakeholders, team members, and external parties all understand the goal of the project and acts as a record of initial expectations.
As-Built Drawings: Also known as record drawings, these are edited drawings submitted by a contractor at the end of a project. They reflect all the changes made in the working drawings during the construction process and show the dimensions, geometry, and location of all elements included in the contract. As-built drawings provide a quick visual into the existing design and capture deviations from the original documents.
Daily Documentation: Keeping diaries, logs, and daily reports of project activities acts as a reference guide after the work is completed and can mitigate any damages. This kind of documentation can show how questions were answered, how problems were solved, and tracks any unusual conditions on a certain day. By keeping these daily logs, you are leaving a paper trail throughout the whole project in case anything goes awry later on.
And finally, the working drawings are created. These are the project’s final specifications and illustrations that builders use for construction and that contractors add to their bid.
Scheduling Strategies for Construction Project Management
Organize your documents in order to prioritize the information you need to build your project schedule. A well-defined schedule helps you to plan, identify potential risks, forecast cash flows, and assess resource requirements.
We’ve outlined some fundamental and advanced scheduling techniques below:
- Gantt Charts: A Gantt chart is the easiest way to create a construction schedule. It lets you visualize your project timeline by transforming task names, dates, durations, and end dates into cascading horizontal bar charts. Learn more about creating and using Gantt charts in Smartsheet.
- Critical Path Scheduling: The most widely used scheduling technique is the critical path method. This method calculates the minimum project completion time and the start and end dates for all project tasks. It identifies the critical tasks that, if delayed, will delay your entire project. The critical path method helps you reduce timelines, manage resources, and compare planned with actual. To learn more, read our Ultimate Guide to the Critical Path Method.
- Line of Balance: This scheduling technique is best suited for repetitive work and is often employed in road construction. It is a management control process for collecting, measuring, and presenting facts relating to time, all measured against a specific plan. With a Line of Balance schedule, you must allocate resources for each step, so you can make sure the next step is not delayed.
- Q Scheduling: This form of construction scheduling addresses the sequence of activities, relationships between tasks, and the total cost of finishing the project. It includes the overall construction site and prevents two competing activities from happening at the same time at the same location. While this technique is the closest to reality, it requires special software and can take more effort from the project manager to evaluate cost analyses for the different schedule alternatives generated.
What Are the Risks Involved in a Construction Project?
Construction projects are always evolving, and uncertainty can bring conflict into project teams. Construction project managers are responsible for resolving disputes, identifying and mitigating risks, and understanding legal ramifications.
Here’s what construction project managers should know:
How to Resolve Disputes
Conflicts will inevitably arise in any project. It’s the project manager’s job to resolve the disputes, so the team can stay productive and work well together. Possible conflicts in a project could include poor communication, lack of clarity, conflicts of interest, limited resources, or power struggles. While every conflict is different, there are several resolution strategies that you may employ:
- Mediation: A third-party mediator will be hired to resolve the disputes between the two parties. This strategy is the cheapest and least time-consuming.
- Mini-Trial: A mini-trial is held in an informal setting with an advisor or an attorney who must be paid. The agreement is nonbinding and can be broken. A mini-trial takes more time and more money than mediation.
- Arbitration: Arbitration is the most expensive and time-consuming way to resolve a conflict. Each party is represented by an attorney while witnesses and evidence are presented. Then, the arbitrator makes a ruling and his final decision is a binding agreement.
How to Create a Risk Management Plan
By focusing on prevention, project managers can spend less time dealing with spontaneous problems and more time on reducing their impact. A risk management plan is used to manage all project risks, defines the roles of project staff in risk management, and identifies potential risks and categorizes them in terms of probability and impact.
Understand Legal Principles
When project managers have to negotiate contracts, deal with jurisdictions’ licensing requirements, purchase insurance, and manage job site safety, an understanding of legal principles can save time and money. There are several areas of liability in construction management. There could be a claim for failure to detect defective work if a bid exceeds estimates, if there is extended overhead, or if the project is delayed. Most professional liability policies don’t cover any aspect of faulty workmanship (like fabrication or installation) or economic risks, so project managers have to make sure they have the appropriate coverage and are doing everything they can to avoid liabilities and claims.
How to Prepare a Quality Control Plan
A quality control plan ensures that the building has reached a specific standard. Quality control is the last step a project goes through before it’s delivered to the owner, and it consists of a series of systems and procedures to make sure it meets the highest standards. Project managers will have to evaluate how to measure project quality, create a step-by-step process for auditing the project, and revise and review the plan to find new problem areas. They will also have to be knowledgeable in safety management and codes, building codes, and compliance codes, then include these aspects in the plan.
How to Anticipate and Address Environmental and Neighborhood Impacts of Construction
Construction project managers can plan for licensing, permits, and local regulations, but some unanticipated roadblocks are unavoidable. Below, we’ve outlined how to deal with issues like excessive mud, vegetation, endangered species, and cultural artifacts.
Dust and Mud: Excessively dusty conditions can result from construction vehicles simply driving on a site, much less moving earth from spot to spot. Because the increased particulate matter can disrupt nearby businesses and homes, construction project owners would do well to control the dust count. One easy way to do so is to drive a water truck through the site and spray down the area. However, this creates mud, which can spread out to surrounding areas via construction vehicles. To counter this development, the project owners should get a street sweeper to clean the roads.
Storm Water Pollution: Construction projects can introduce foreign elements to the land. Should a storm hit, the runoff can carry those potential pollutants to nearby streams, rivers, lakes, aquifers, wetlands, or coastal waters.
Endangered Species: If an endangered species is found on the construction site, the site must cease operations for as long as it takes for authorities to assess the situation. Once a decision comes down, the contractor implements the proper course of action to not disturb the species.
Vegetation: Animals aren’t the only protected entities; trees and vegetation on a construction site could be subject to environmental safeguards too. The construction project manager could be faced with designating a safe zone for the growth, perhaps with a fence or security tape.
Wetlands: Wetlands are some of the most heavily protected areas in the United States. Contractors and builders must be especially vigilant in preventing contaminants or unregulated material from entering these restricted zones.
Historical or Cultural Artifacts: This classification can cover arrowheads, pottery shards, early tools, bones, and more. If any artifacts are found on the construction site, all work must halt until the the pieces can be studied and removed.
Construction Project Management Software
There are many versatile web, cloud, and mobile apps to streamline communication, simplify document management, and improve efficiency in construction management.
Here are some top construction management tools:
Smartsheet
Smartsheet is a spreadsheet-inspired work management tool with robust collaboration and communication features. With pre-built construction templates, it’s easy to create a timeline, track progress, manage documents, and organize the details. Gantt charts are automatically created and auto-adjust every time a change is made, so you can share the most up-to-date timeline with team members or stakeholders. You can upload files from your computer, Google Drive, Box, Dropbox, Evernote, or add a web URL, creating a central repository for all project documentation and contracts. Team members can have discussions directly in the sheet and set reminders and alerts, so everyone is on the same page. And lastly, Smartsheet integrates with other apps like DocuSign (to streamline the contract process by collecting e-signatures), Harvest (to automatically create invoices), and Google Apps (to sync your calendar and add or edit information directly from Gmail). Get a free 30-day trial of Smartsheet.
Buildertrend
BuilderTREND is a cloud-based construction project management tool for home builders and remodelers. It helps builders communicate with subcontractors about tasks and allows clients to see real-time status about their home and the costs. BuilderTrend lets you create proposals, simplify the bidding process, send documents, create schedules, and manage customer relationships.
Co-Construct
Co-construct is a web-based solution for custom builders and remodelers. It helps businesses coordinate their selections, schedules, and photos while improving relationships with interactive communication. Users can track change orders, create a project budget, update schedules, share files, and more.
Procore
Procore helps firms increase efficiency and accountability with streamlined communication and documentation. The cloud-based tool provides ways to collaborate on projects and view documents, with real-time editing capabilities. Other features include project dashboards, scheduling, reporting, document management, email training, bidding and more.
BuildTools
BuildTools is designed for residential construction firms and offers project management, scheduling, service management, document storage, budgeting, and customer management capabilities. You can manage all the communication for your crew and subcontractors, easily sharing emails, site photos, project schedules, budgets, and timesheets.
Aconex
Aconex offers one solution to manage information and processes across engineering and construction project to improve efficiency and reduce risk. Features include document management, workflow automation, bid management, issue management, and more. As a web-based solution, Aconex allows users to create and review documents from any location.
PlanGrid
PlanGrid is a construction productivity platform that enables collaboration via mobile device in the field or wherever your project team is working. It allows the latest versions of blueprints, RFPs, schedules, and more to be synced to every employee in real time.
Education Opportunities for Construction Project Management
To learn more about education programs in commercial construction management and career opportunities in the CM field, see "Everything You Need to Know About Commercial Construction Management and Managers."
How to Manage Sustainable Building Projects
Project managers who oversee sustainable building projects must understand how they affect the environment, ensure that they properly dispose of waste, and use sustainable materials and efficient building methods. They must also understand any area-specific environmental issues and compliance standards.
Green construction is focused on making structures more energy efficient and eco-friendly, and is a huge growth area in the construction industry. The term green building refers to the effort to ensure that both the actual structure and building process are environmentally responsible. Many green project managers are required to have a working knowledge of documentation requirements for Leadership in Energy and Environmental Design (LEED).
Terminology and Acronym List
A&E: architectural and engineering
BOT: build operate transfer
BOO: build own operate
CA: contract administrator
CIP: capital improvement plan
CM: construction manager
CPI: cost performance index
CPM: critical path method
CREM: corporate real estate management
D/B: design/build
D/B/B: design/bid/build
DBOT: design build operate transfer
EA: environmental assessment
EIS: environmental impact statement
EPC: engineering, procurement, and construction
FBOT: finance build operate transfer
FEIS: final environmental impact statement
FONSI: finding of no significant impact
GC: general contract
GEC: general engineering consultant
GM: general manager
GMP: guaranteed maximum price
JV: joint venture
LEED: Leadership in Energy and Environmental Design
MC: management contracting (mostly UK)
MPC: multiple prime contracts
MPO: metropolitan planning organization
OFE: owner furnished equipment
OSHA: Occupational Safety and Health Administration
O&M: operations and maintenance
OR: owner representative
PC: project control
PD: project director
PFI: private finance initiative
PL: project leader
PM: project manager
PMC: project management consultant
PMO: project management oversight
PMP: project management plan
PRD: project requirements definition
ProgM: program management
RE: resident engineer
REM: real estate management
RFC: request for change
RFI: request for information
RFP: request for proposal
SOW: scope of work
SPI: schedule performance index
VE: value engineering
WBS: work breakdown structure
Improve Construction Project Management with Smartsheet
From pre-construction to project closeout, keep all stakeholders in the loop with real-time collaboration and automated updates so you can make better, more informed decisions, all while landing your projects on time and within budget.
The Smartsheet platform makes it easy to plan, capture, manage, and report on work from anywhere, helping your team be more effective and get more done. Report on key metrics and get real-time visibility into work as it happens with roll-up reports, dashboards, and automated workflows built to keep your team connected and informed.
When teams have clarity into the work getting done, there’s no telling how much more they can accomplish in the same amount of time. Try Smartsheet for free, today.