Construction project delays cost time and money, and damage contractors’ reputations. Consider these tips for keeping delays and risks to a minimum.

As with any collaborative project, delays, misunderstandings and other problems can crop up. Construction projects are especially prone. According to the Construction Industry Institute, about one out of every three construction projects is over budget or behind schedule, ConstructionCrossing reports.

Snags in a construction project not only means extra costs, but also damage to a contractor’s reputation. When it comes to infrastructure development, delays and quality issues can affect the owners, the contractors and the entire community’s economy.

Delays, disputes and going over budget are caused by internal and external factors, from financial troubles and design changes to communication breakdowns and unforeseen circumstances. Fortunately, these problems can be minimized or avoided by managing risks associated with the project.

Always plan and account for the unexpected, advises ConstructionCrossing. “One standard key is always to build some degree of extra time into your project timeline.” When it comes to weather, this extra time depends on the nature of the project and where you’re working. Also, keep in mind that materials shipping in from other parts of the country or world could be adversely affected by weather, so build in extra time for delivery.

Opt for in-stock items whenever possible or use suppliers that maintain larger local stocks of needed items, ConstructionCrossing says. “Otherwise, double the estimated shipping time for your planning purposes.”

As for controllable risk factors, communication and clarity are imperative for reducing delays and other problems. “Documentation and correspondence are the lifeblood of a collaborative construction project and the majority of the risks originating from the client and consultants are fundamentally linked to communication and information management,” says document management company Aconex.

To prevent frequent or late changes at critical stages of design and construction, all parties involved must know what’s going on with each phase of the project. With thousands of documents and pieces of correspondence that flow between participants, it’s easy to have misunderstandings and errors. One way to keep track of everything is by having a collaborative information management system that everyone involved has access to, Aconex says.

Additionally, everyone must be on the same page. Before the contract is signed, letters of intent can be used to get the project started. Just like contracts, they are legally binding so contractors should agree to all the terms in the letter of intent before signing, U.K. law services group Alway Associates warns. “Provided the terms of the building contract are eventually agreed [upon] there is usually no problem. However, disputes often crop up over the meaning of letters of intent where works have progressed under them and no formal contract has been agreed.”

Ensure the document is easily understood and all points are clear. Once the contract is drafted, ensure that the project team is familiar with all the details of the contract and that everyone (contractor, client, financier, etc.) is fully aware of their obligations. “As the work progresses, make certain that the procedural requirements under the contract are followed,” Always Associates adds.

The same meticulousness for detail should be applied to plans and specifications. “Generally speaking, if you have an excellent set of plans, you will avoid surprises and change orders,” Ask the Builder columnist Tim Carter says. “Both of these can create havoc in scheduling, especially change orders. Change orders usually can be traced back to poor planning, because you or the architect did not explore or think out all possibilities.”

All parties must come to a consensus on the length of time the project will take, what materials are needed and how they will be procured.

Last, ensure that financing is secure. Nothing stops a project quicker than lack of funding. Contractors must keep their eyes open for warning signs that the owner’s financial health may be deteriorating, Constructor.com says.

Watch for these red flags:

• Owner missing meetings to meet with lenders;
• Lenders showing up at project site; and
• Owners uneasy about giving access to loan documents.

Constructor.com suggests the following to prevent finance-related project interruptions:

• Demand proof of financing.
• Review agreements with the lender.
• Review the contract about right to payment and change orders.
• Determine if and how payments may be slowing.
• Talk to your client and ask direct questions.

By openly communicating and establishing a freeflowing exchange of information between all parties, delays can be minimized.

Resources

Don’t Let Delays Derail Your Construction Project
by Dean Bennett
ConstructionCrossing

Using Collaboration Technology to Manage Risk on Construction Projects
Aconex, Oct. 17, 2007

Specific Building Plans Help Avoid Delays
by Tim Carter
Ask the Builder

Doing Your Diligence
by Angelle Bergeron
Constructor, June 2009