In the 1960’s the name of the game for construction firms was to “get it done”, deliver the project and then, hash out the financial issues at the end of the job with the client. Contractors were comfortable doing this. Clients understood the ethic and appreciated the extra work this involved.
Since that time, owners have slowly changed but, change they have. Thses clients view construction firms as a resource that is to be managed. Owners understand more about the construction process than ever before. They involve themselves deeper in projects. It is their right; however, if they manage the details closer, we should expect a responsive and reliable partner. If not, it is rational for us to hold them accountable.
For specialty contractors who work for general contractors, the business has changed also. There are two factors:
1. The rise of the construction management degree
2. The desire not to gain “field experience”
This has made some prime contractors harder to work with. Let me quickly say, there are great general contractors in this country who understand what I about to state.
Most young construction professionals do not (did not) go through the “field”. They won’t. They didn’t want to work in the dirty and dangerous job of a construction project. They would rather be in the office. This lack of field experience has lead to a decline in construction knowledge. Thus, decreases the amount of coordination that can be offered by the general.
The other part in the rise of the number of construction management degrees earned. More colleges offer them than ever before. (The author has one). They have made construction turn into a business. The contracts are thicker and have more language that protects the general contractor.
Due to these two trends, some subcontractors now build the projects with more paperwork, less coordination and less leadership from the general. Decades ago this wasn’t the case.
Again, the top 25% of general contractors are different. They build projects with the help of their subcontractors. They offer leadership, coordination and are a good business partner.
In practical terms, construction is now a tennis match. Hit the ball over the net. Wait for the return. If there is no return, stop the match and find out why. Then, persuade (or force) the other side to continue to play.
Additionally, keeping score has new meaning. Today, capturing, notifying and tracking issues on a project are a must. Our primary scoring mechanism is the CPM Schedule but is augmented by all other project documentation.
In the contracting world, when we send a request for information, we should expect it to be answered in a timely fashion. If not, contractors have to address the problem now. To install work without needed clarification is indefensible. There is no clear recourse afterward. The same for change orders, pay requests, changed project conditions and the like.
Here are items that if not answered promptly might be grounds for a contractor to stop work on the entire project or just the affected part.
1) Monthly Draw Requests
2) Change Orders
3) RFI answers.
5) Product Information on Owner Furnished Material.
6) Color Selections
7) Signed and executed contracts
Each contractor is aware of the problem with slow or non-responsive clients. This is just one problem of many risks we take. However, it is one we control. We can affect this and therefore, direct the project to a satisfactory end.
Contracting has changed from the 60’s to now. That is to be expected. Years ago, the construction business was more straightforward, now it is not. Today, business people and lawyers are showing us that leverage is more important than ever. They have put the word “contract” into “contracting”. Sadly, Construction has evolved into a business while the craftsmanship devolved into a secondary priority.
For more information on this critical subject, purchase a copy of my McGraw-Hill book, Managing a Construction Firm on Just 24 Hours a Day. We offer a bundle with Excel templates that are featured in the book and 5 on-line courses to help teach construction business concepts.
Workbook companion with 10 case studies for Managing a Construction Firm on Just 24 Hours a Day is now available. This is focused as an assist for Colleges, Associations and other learning programs that teach the business of construction.
Matt Stevens is President of Stevens Construction Institute, Inc. A management consulting firm which works only with construction contractors. Learn more at www.stevensci.com