What are the Consequences of Poor Management?
In any business, poor project management can have measurable consequences. In construction especially, it can make both you and your clients miserable. Here are some examples of what poor construction management might look like for your company.
You don’t have a solid process for tracking documents. You gave your client inaccurate information. Or worse—you didn’t get back to your client when you said you would. Not only can you lose someone’s business from poor project management, but you can also hurt your reputation.
Job Delays and Cost Overruns
You incorrectly estimated and tracked the timing of each subcontractor’s work. For instance, your plumber arrives at the jobsite before the sinks are installed. The project manager doesn’t know what each subcontractor needs to do their job.
Frustrated Staff and High Turnover
There aren’t proper processes in place to ensure that everyone is on the same page during a project. Each team member feels confused and unsure of their role, which leads to poor company culture—this may lead to hiring difficulties.
Threats or Fears of Litigation
You have no confidence in your business’s documentation and customer relationship management. Each project suffers from disorganized documents, murky communication, and unclear expectations. You’re not sure you could easily defend yourself in the case of a lawsuit (from client or subcontractor).
Lack of Trust
Your clients, workers, and subcontractors don’t trust each other or the company. Clients constantly check in to make sure you’re doing your job correctly. Subcontractors are bidding higher (or not at all) for your projects because they don’t trust your process.
No Success Stories to Share
No client is blown away by your professionalism and quality of work. No one wants to recommend you. You don’t even want to share the project’s results because you know it’s not worth sharing.
Lost Revenue and Profitability Erosion
Due to one or many of the above examples, you find that your profit margin is getting smaller and smaller. You’re losing business left and right because you’ve gained a reputation for being flaky and unorganized among clients, subcontractors, and potential employees.
Poor Management Habits and What to Do Instead
Even if you haven’t yet experienced the consequences of poor project management, you likely will if you do the following:
Frequently rely on memory. You trust yourself to follow the project timeline and remember “who said what when,” all without writing anything down.
- Instead, track and document every conversation (who was involved and when). You’re saving yourself from a headache (or possible litigation) six months down the line.
Use ad hoc (as needed) processes. You throw together team huddles when they seem necessary. You might not take notes during meetings. If you do take notes, you jot them down on a scrap piece of paper (that you later find has been washed and dried in the back pocket of your Dickies).
- Instead, plan and be intentional with your meetings and their frequency. You should have a set communication process in place, so everyone knows when they can ask and answer their team members’ questions. These planned meetings should also be documented in a central, accessible location.
Trust the handshake too much. You believe that someone will honor their word. You don’t rely on written contracts or paperwork with many of your agreements—you know they’re good for it.
- Instead, put your agreements in writing, no matter how close you are to a subcontractor. Documentation protects all parties involved by providing transparency and security. No team member is left in the dark if something were to happen to you or your peer.
Curb Assumptions and Expectations
You know the old saying about what happens when you assume? To put it nicely: assumptions can place all involved parties in a bind. Assumptions are one’s opinion (not fact). When a conversation or expectation is not in writing, it can’t be proven.
Anyone—you, the client, your employees, or your subcontractors—can fall victim to assumptions. While these opinions are often well-intentioned, they can lead to problems. If your accounting team assumes a client paid their third invoice on time because they paid the last two promptly, the project could run out of money.
Trust and Verify
While you want to build trust between yourself and others, you also need to protect your company’s interests. Avoid working in a vacuum where information is not regularly shared. Instead, practice diligent documentation, verification, and collaboration.
Avoid Ineffective Planning
Logistical Challenges during COVID-19 and Otherwise
When planning a project, do you consider the logistical challenges? Coordinating your team members and your subcontractors can be difficult if you don’t factor in each project’s specific needs.
Especially during the coronavirus pandemic, construction contractors must take into account environmental factors. For example, are you adhering to your state’s social distancing guidelines? How might you handle an employee testing positive for COVID-19?
Address Potential Changes and Understand Constraints
If you’re monitoring your projects correctly, you should be able to predict and prepare for possible changes. Good preparation means you have an action plan to deal with delays, subcontractor cancellations, traffic jams, or bad weather. You also communicate ahead of time to ensure all parties know when and how the plan is changing.
Ditch the Incomplete Risk Assessments
In the construction business, you’re often under a tight deadline and still expected to produce quality work. That’s why comprehensive risk assessment is key to protecting your bottom line. Do you give your staff enough time to assess the risk involved with a project or task accurately? Are you considering all the potential risks and their solutions? An incomplete risk assessment can lead to lost profits, lost time, and possible legal issues.
Are You Practicing Good Project Management?
Still wondering whether you’re managing your projects poorly? Ask yourself the following two questions:
Do I know that the people who need to know something know what they need to know when they need to know it?
Do I know that the people who needed to know something knew what they needed to know when they needed to know it?
(Say that three times fast!)
It all boils down to good communication, proper documentation, and proactive planning—all of which can be done with the right project management software. RedTeam’s intuitive construction project management platform helps general contractors stay on track and keep their collaborators up-to-date. Request a demo and learn for yourself how much easier project management can be when you make RedTeam a part of the process.