Construction Managers: Improve Your Project Communication, Improve Your Bottom Line
Construction managers: Poor communication causes rework, cost overruns, delays, and unhappy stakeholders. Improving communication can improve your bottom line.
Poor communication is a leading cause of conflict in the construction industry. According to Project Management Institute (PMI) research, as much as $75 million of every billion dollars spent in projects under management can be put at risk through poor communication.
Ineffective or nonexistent communication leads to rework, cost overruns, blown schedules, and unhappy stakeholders. Project conflict creates delays and increases costs.
PMI research also shows that only 37% of projects with minimally effective communication were completed on time, only 48% completed within budget, and just 52% met their original goals. On the other hand, projects with effective communication had a 71% on-time completion rate, 76% were completed within budget, and 80% met their original goals.
There are many ways that poor communication (tracking, documenting, reporting) can impact your construction project and lead to profit loss. As a construction management professional, you’ve probably experienced them. Unclear documentation of change orders leading to lost revenue.
Poorly communicated punch lists leading to costly rework. And failure to conduct and document safety meetings leads to potential delays and financial penalties.
Like any business, construction depends on accurate, timely, and consistent communication. And because your construction management teams are distributed in the office and field, moving between projects, and located throughout the country or globally, effective communication is a challenge.
So, let’s look at some ways that poor communication can impact your construction business.
Poor or Lacking Communication Creates Confusion
Lack of communication is clearly a problem in construction. Proceeding on work without approval, making changes without authority, or increasing costs without notification can all undermine a project’s profitability and harm your business. But miscommunication can also hurt a project by creating confusion for everyone involved – from significant stakeholders to construction managers and your workforce in the field.
In addition, inconsistent, unclear, delayed, or incomplete project tracking, documenting, and reporting can lead to mistakes, schedule delays, and budget overruns on the job site and in your office.
By providing clear, concise, and timely communication, you can help to avoid confusion on the project. Keep your messages brief, clear, and to the point. If you are managing multiple projects, don’t cover them all in a single email or report. Instead, focus each message on a single project and subject.
And remember the knowledge level of the recipient. Communicate at their level. Avoid jargon and industry insider terminology. Communicating with project stakeholders may require more detail to explain the importance and implications of the information you’re relaying.
Your team’s clear, focused, and real-time communication, whether in reports, emails, texts, or phone calls, is essential to keeping the projects and your overall business running smoothly.
Contributes to Delays
Ineffective (poor, lacking, unclear) communication in the construction industry is a significant cause of project delays. Ineffective communication can mean several things, such as delays in the information flow, communication directed to the incorrect person or area, and unclear communication that creates confusion or fosters inaccurate information.
Any of these aspects of ineffective communication can result in mistakes, reworks, and costly delays. For example, ordering incorrect materials to the job site, missing an item on a punch list, or misallocating the workers for the day can cost you precious time and money that is almost impossible to recoup.
The worst possible outcome is that poor or ineffective communication results in a dispute. Unfortunately, poor communication is one of the leading causes of conflicts in the construction industry. That’s why it’s essential to keep stakeholders regularly apprised and up-to-date with clearly presented information on the project to avoid miscommunication.
It’s also critical to report through the proper channels. For example, suppose your change order approval is directed to the wrong individual. In that case, you may think you’ve received the authorization to proceed when in fact, the appropriate person didn’t sign off. This scenario is likely to lead to a dispute, which can cause a cascading effect and delay in the project schedule.
Creates Budget and Cost Overruns, Forecasting Inaccuracies
Ineffective communication, miscommunication, or nonexistent communication can lead directly to increased costs and budget overruns. For example, transposing the digits on a material quantity can wreak budget and project forecasting havoc. There are other ways communication can break down.
For example, suppose a material change is not communicated through the RFIs or Submissions process promptly. In that case, you could end up eating the cost of the material ordered in error. Sometimes, the terminology can be the root of poor communication. For example, the designer’s name for a specific finish or material may differ from the term you use or even the industry standard.
Misunderstandings can also lead to work performed improperly or out of sequence. When this occurs, reworking the problem area can bust the budget, add days to the schedule, and eat away at contingency money.
Contributes to Mismanaged Safety and Injury Issues
Workers in the construction industry operate in a high-risk environment. Improperly communicating safety issues, warnings, or hazardous condition information not only puts workers in harm’s way but adds severe risk to your business.
For example, more than 200,000 non-fatal construction injuries and more than 900 fatal incidents are reported each year in the United States. In addition, the construction industry fatality rate is higher than the national average compared to all other industries.
Why is construction work so hazardous? Conditions on the job site are rife with opportunities for injury or worse. Heavy equipment, slip, trip and fall hazards, electrical shocks, open trench work, and more create unsafe working conditions. Much of these hazards are known and foreseeable.
However, the risk to workers is compounded through poor or nonexistent safety training information, procedures, and communication. Furthermore, inadequate safety training documentation can increase the risk of OSHA penalties, legal issues and jeopardize your entire construction business.
- How can construction businesses improve safety communication?
- Keep up with safety meetings and proper documentation
- Communicate injury procedures and safety protocols clearly
- Be sure workers are familiar with safety terminology
- Remove any fear or stigma workers might face for speaking out or asking questions about unsafe conditions
- Incentivize and acknowledge safe work practices
- Create a positive atmosphere on the topic of safety
When workers are involved in a work-related injury, they face the effects of the injury itself, loss of work, pay, and possibly worse. In addition, your business loses productivity, and faces increased costs, project delays, and decreased morale for the team.
You can help void circumstances like this with proper safety procedure communication, documentation, and meetings. Properly conducted safety meetings put worker safety at the forefront, highlights hazardous conditions that may change daily, and generally improve workforce morale.
Creates Problems with Stakeholders at Every Level
Construction can involve a complex group of stakeholders on every project, such as owners, architects, designers, investors, general contractors, project managers, sub-contractors, and the overall workforce. As a result, the project’s success can ultimately depend on the effectiveness of exchanging information among this diverse mix of people and interests.
As everyone in construction knows, rework is the bane of a project. Rework can increase project costs, cause delays, and even lead to disputes among stakeholders. According to research conducted by PlanGrid and FMI, inaccurate or missing project data and miscommunication among stakeholders are responsible for 48% of all project rework!
Building a communication plan for all stakeholders on the project can help smooth out the process and identify issues early before construction begins. First, find out what type of communication works best for each stakeholder. For example, uncovering that a major stakeholder relies solely on texting can prevent communication issues later when team members wonder why there’s been no reply to their emails.
The quality and consistency of communication among your entire project stakeholders can make the difference between closing out a profitable project for a satisfied owner or a so-so project that loses money. You can improve your project communication significantly by using construction management software such as CMPRO™ construction management software.
CMPRO provides real-time access to project information pertinent to your teams in the field and office to improve communication and save time and money on every project. If all the stakeholders are on the same page and communicating effectively, the whole project is set up for success.
CMPRO was designed and built with decades of construction management experience. We have focused that expertise on the product features your construction and project managers need to lower costs and increase productivity. As a result,
CMPRO is simple to learn and master, increasing the likelihood your team will use it every day to document and report on all critical aspects of the project. And because CMPRO is so easy to learn and use, it reduces the cost of the training required to bring new people on board.
CMPRO helps your on-site and in-office construction management teams manage mission-critical elements of every construction project, including:
- Pay Applications
- Pay Periods
- Change Orders
- Vendor Contracts
For your job-site team specifically, CMPRO has equally robust construction project management features, including:
- Daily Logs
- Punch Lists
- RFIs (Requests for Information)
- Purchase Orders (Coming Soon!)
Find out how CMPRO™ can help improve project communication by simplifying your tracking, documentation, and reporting processes throughout your entire team. To find out more and schedule a demo, visit us online, or contact us at [email protected].