Construction Project Management: The Ultimate Guide
by Matthew Sprague | May 11, 2022
What is Construction Project Management?
Construction project management is a service that manages construction projects for any project delivery method, and focuses on addressing important concerns such as cost control, scheduling, and risk assessment.
A construction project manager is the professional who oversees a construction project from inception to completion, helping manage not only the high-level project responsibilities, but also the detailed nuances in the field and with documentation. This professional is typically an employee of the project owner, and works with stakeholders from all facets of the project– architects, owners, engineers, subcontractors, public works, city planning, and office staff.
Construction Project Management Team Structure
Within the construction project management team structure, many people are involved with varying roles, responsibilities, tasks, and goals. A few of the key team members are highlighted below.
Construction Project Manager
While hierarchies can vary depending on organization size and reporting structure, a construction project manager works for the owner and is often an employee of the general contractor, a hired contractor who specializes in the project field, or sometimes the owner has several in-house construction managers to support multiple projects.
The construction project manager is typically tasked with the following:
- Estimating or collaborating with the professional estimator to negotiate project costs and develop the construction budget
- Planning and coordinating the project schedule
- Collaborating directly with and streamlining communication between subcontractors, owners, architects, or city officials on project details as needed
- Ensuring all permits are in place
- Ensuring the construction is built to plans and meets regulatory design codes
- Interfacing with the project team to work through any issues that arise during construction in a way that still meets the project timeline, budget, and specifications
The general contractor (GC) is selected by the owner from the pool of bids received by the owner, and is responsible for the job site daily operations, equipment, materials, and labor throughout project execution, with the construction project manager employed by the GC as the main point of contact throughout the project.
The general contractor performs the following:
- Applies for permits and manages the permitting process
- Directly supervises the subcontractors to ensure project success
- Offers collaboration with the project owner and project manager
- Manages the job site safety protocols and standards
- Provides or rents the appropriate construction equipment for the job site’s various job phases
The project owner can be defined as the person or organization that has the need for the construction project, finances the project, or is responsible for securing financing. The project owner can also be a local government with infrastructure projects.
The project owner is responsible for the following:
- Decides the project delivery method
- Selects the general contractor and often the project manager
- Defines the high-level budget and schedule goals
The role of a financial planner in construction project management is to keep the project within budget and work with the owner and financial backers to ensure funding is available based on the payment schedule.
The financial planner accomplishes the following:
- Works closely with the owner and project manager to identify potential budget concerns
- Provides reports with financial data for decision-making purposes
- Ensures budgeted funding is available throughout the various project stages
Stages of Construction Project Management
Within construction project management, there are various phases and components.
1. Planning / Development
While there are many components of a construction project, clarifying the planning and design stages prior to the actual construction is the most critical. During the planning and development stage, the project owner collects input from stakeholders; conducts feasibility studies; gathers details of the projected budget and funding options; understands the potential risks of taking on the construction or capital projects; and discusses at length the benefits of the projects versus alternative solutions to understand if the project and its benefits fit into the owner’s portfolio.
At this point, the owner balances the potential Return on Investment (ROI) against input from key stakeholders both on their team and those who may later be involved in the project.
Furthermore, investigating issues that may arise before the project even begins strengthens the purpose of this planning and development stage and can support smoother proceedings throughout the project.
The planning and development stage is the phase in which the owner gathers a list of desired design requirements to be included in the project and brings it into the design stage.
It is the owner of a construction project or capital improvement project who has the vision for the project. During the design stage, the owner chooses an architect or engineer to help bring the vision to life in a way that meets budget needs, timeline expectations, and project requirements.
The architect or engineer will then work with the owner from the project’s conception all the way to final blueprints, which are then brought into the procurement stage.
Once a GC and project manager are chosen by the owner, all bids are in, and the subcontractors are under contract, procurement can commence.
Materials, services, and labor are sourced during the procurement phase, then purchased (or hired) and scheduled. Contingencies should be set in place contractually for supply chain shortages, price volatility, and procurement timelines that support the overall project schedule.
Once the Notice of Commencement is signed, construction can begin. The construction project manager and owner customarily work together closely to guarantee that the project remains on time and on budget. They do this while simultaneously meeting the project and legal specifications. Because there is no set-it-and-forget-it button in the construction project management process, continual monitoring, progress updates, and working in coordination with the construction project manager are all required for keeping the project on target.
Construction Project Management Processes
Even the best-laid construction project management plans can fail without proper construction project management processes in place. Construction project management processes are vital for keeping a project running smoothly throughout each construction stage. In each stage, it’s important to note that proper documentation plays a major role in project success.
Project Initiation / Research
Before the building or capital project design can even begin, owners collect stakeholder input and perform feasibility studies to determine if the project should be considered as an addition to the owner’s portfolio. This research and information is required to determine if there will be an ROI or if there is too much risk to consider the capital project.
If the owner decides to move forward with the construction project, the owner and engineer/architect gather project requirements, specifications, and limitations due to permitting or job site location. This gathered information is brought into the project planning phase, so keeping it organized and digitally available supports a smoother project planning phase.
Information from the feasibility studies and stakeholder input are important to consider when understanding the project requirements, making ease of access to cloud-based information a major benefit during the project planning phase.
Collaboration between owner and architect is important to ensure the architect is properly portraying the vision and needs of the owner into a design plan.
The construction project manager plays an important role in the project planning phase, working with the owner to determine project scope, properly estimate budget and schedule based on the design plans, and procure materials and labor.
Each person in the design team—general contractor, subcontractors, superintendent and project manager– all have specific roles within a construction project. Properly managing the resource pool and tasking of responsibilities eliminates redundancies, encourages ownership, and prevents delays during project planning and execution.
Having roles properly defined prior to project execution will help encourage a speedy resolution when change orders or requests for information arise, or when issues inevitably pop up on the job site.
In the throes of project execution, construction project managers and owners benefit from quick approvals to avoid costly project delays. Progress reports against project schedule, scope, and budget provide insight as to the health of the project and whether or not it is on track.
Project execution goes faster when there is a defined approval workflow in place for change management. Looking at the causes and potential impacts of a workflow solution supports project managers in their decision-making process.
Upon project finalization, general contractors typically supply warranty information and operational procedures from the subcontractors before a permit close-out. Without a streamlined gathering-and-sharing system, it can become disorganized, causing delays in operations if or when a post close-out issue arises on the job site.
Project Monitoring and Control
Once the project is closed out, the project still needs to be monitored. When the project close-out documents are in a cloud-based project management system, any warranty information, operating manuals, or contact information can easily be found should an issue arise that needs to be addressed.
Tips for Overcoming Construction Project Management Challenges
To keep a project within budget and schedule, a project manager must practice effective construction project management. The following tips explain how to handle common construction project management challenges as an owner with a new construction or capital improvement project.
Paper trails, never-ending emails, and notes on a cell phone are NOT the magic formula for successful construction project communication.
As an owner of a construction project, taking the lead on effective communication includes using verbiage in contracts that establishes a chain of command both on the job site and within workflow processes.
Establishing the appropriate method of communication is also important. The process by which field notes, meeting notes, and inquiries from the field are captured is just as important as communication about keeping official contract change orders and requests for information.
Well-thought-out, detailed contracts and contingency plans with the GC and subcontractors, established on top of finalized blueprints and building plans, can help prevent scope creep.
Understanding the process of change management and change orders, and hiring a construction project manager who is diligent to remain within schedule and budget, are critical for managing the scope of work properly.
Proper planning and reporting tools based on the latest project data can support an owner in managing risk. Easily accessible dashboards and forecast reports specific to the project and owner’s needs help aid in the decision making process.
An owner would want to complete the following before estimation: have plans that are as accurate and complete as possible prior to the estimation phase; ensure an experienced estimating and subcontractor team is in place; and have contingencies in the schedule and budget on what to do contractually if a budget issue arises.
Siloed data occurs when project information is spread across multiple data sources– emails, paper trails, Excel spreadsheets, and scattered program management software— that never fully capture the big picture or health of the entire project.
Implementing a cloud-based construction management platform such as e-Builder Enterprise eliminates data silos, keeping projects moving forward with fast-acting information, reporting tools, and critical workflows all based within the same software program.
Lack of real-time data
Without real-time project data, project stakeholders can only make guesses when it comes to decision-making efforts that are critical to project budget and schedule.
Having a system and processes in place that encourage real-time data storage allows for better monitoring of critical project components.
Construction Project Management Made Easy
As a fully-integrated construction project management software solution designed for owners, e-Builder Enterprise has many benefits.
With e-Builder Enterprise, owners can:
- Eliminate data silos
- Streamline workflows and assign specific roles to various workflows based on project and owner requirements
- Increase communication between owner, project manager, general contractor, subcontractors, and architect/engineer
- Keep focused on the project requirements, while staying on schedule and under budget
- Eliminate inefficiencies in processes, allowing for less money wasted on labor and supplies
- Make informed decisions using real-time project data with built-in or customized reporting tools
Ready to learn more about e-Builder Enterprise? Find out more here.
Key Topics Covered: Construction Project Management