In 2015, KPMG revealed only 31% of construction projects came within 10 percent of the budget. Five years ago may seem like another lifetime, but it’s not. With pandemic-related cutbacks, the challenges of construction cost management loom larger than life.
Post-Pandemic Construction Cost Management
Rather than cut back, consider how to move forward.
–Steve Coughran, business strategy professional
Some of us weren’t managing our businesses that well before the pandemic, so it didn’t take much to topple an already shaky tower. Among the construction cost management challenges we face are:
- Documentation – Multiple change orders and complex approval process
- Minimize mistakes with a connected platform (see: “software”). Teams enter costs in real-time and the change orders’ approval processes are easily tracked.
- Financial health – Lack of real-time view and/or inability to see historical construction cost management changes
- Implement an integrated cost management solution (see: “software”) that gives everyone real-time views of project costs. Online paper trails are easier to track.
- Multiple projects/contracts – Tracking ways every expense impacts the overall financial structure of each project
- Manage subcontractors on a cloud platform (see: “software”). Teams can view real-time entries, edits, and contracts in one location for effective construction cost management.
Categorize every expense as “avoidable” or “unavoidable.” Avoidable expenses will not directly impact your customer and are not fundamental to operations.
When you can cut specific expenses that will save money now, those are opportunity costs. But beware: Canceling employee training now will save money but can have negative consequences later.
It could impact employee retention; something that is a factor in quality-of-work deliverables. Companies showing current training and certification documentation can have an edge over lower-bidding companies.
Construction Monitor: Software Analytics for Real-Time Leads
Construction cost management begins before the bid. Post-pandemic business managers are working smarter and using technology to save time and money.
That’s what we do for you. We provide customized data analytics – sorted – to meet your business needs. The basic information is free if you know where to look. But you can spend a lot of time breaking down that “free” information. By the time you’ve figured out what you need, an opportunity may be history.
Your time is better spent making money. You can make profitable business decisions faster with weekly datasorts that target your specific U.S. region and your market. Ask us how it works. Contact Construction Monitor today.