Disciplining the Project Construction
CBRE’S Project Management business line partners with clients to deliver projects from “concept to completion” by implementing cost efficient, leading industry processes to optimize projects, minimize risk and create value. gurjot bhatia, Managing Directo
With the overall market moving towards ease of doing business, we can expect potential investors to re-look at the market for investment opportunities. According infrastructure status to affordable housing was an important step towards promoting access to priority lending thereby, spurring supply of low cost housing units across various cities in India. Further, the increased allocation under the Pradhan Mantri Awas Yojana (PMAY) scheme will not only encourage home buyers to invest but also encourage participation from private players to launch projects in this segment. Relaxations in area measurement as well as completion timelines to seek tax exemption are also welcome announcements.
Rera the “game-changer”
With RERA being implemented across the states, developers are likely to focus on the timely delivery of their ongoing projects and also remain increasingly flexible on pricing and payment structures. Project Management will prove to be a perfect solution to overcome any short-term challenges that developers and other stakeholders may face. More than ever, now, it is extremely important for development companies to institutionalize the discipline of Project Management. A comprehensive Project Management plan, which brings together all project activities to ensure a timely, cost effective and quality delivery of a project, will enable developers to plan, construct and deliver a project with certainty, transparency and in line with the guard-rails of RERA
the Factors Driving the ADOPTION Of PROJECT Management strategies Project management is evolving as the projects are becoming more complex and are increasing in size and scale. Changing dynamics require innovative methodologies and sustainable approach. Management teams run the risk of depending solely on project teams for information on large capital expenditure. This has given rise to project independent governance structures that have evolved from base levels such as site audits, to risk-based internal audits and capital expenditure reviews, and of late, to full-fledged project reviews at particular points in time and / or continuous reviews.
Project Management in fact becomes shorthand for project, program and portfolio management. At an enterprise/execution level, application of robust Project Management optimizes the project cost in number of ways:
• Design Management: Value & performance enhancement via value engineering. Cost reduction via material and technology substitutions.
• Identifying Risks: Critical areas, time consuming activities, labor intensive jobs, resource dependent actions, there-by ensuring cost distribution of low and high-risk activities.
Detailed Program Management: Using tracking tools and software, keeping margins and back up planning for the identified risks, thereby allocating a sundry cost for the back-up in case of high risk actions.
• Human Resource Management: Understanding the potential of each team member, allocating tasks and timelines in a customized fashion, thereby optimizing on the overall cost of man-hours required.
Cost Management: Drafting a high-level budget at conceptual stage and aligning it with the resources/funds available. Transitioning this figure into a more detailed budget at the program management level and further breaking it down to the last nail before tendering stage to
avoid any surprise costs during construction.
• Procurement Management: Cost negotiations is the key scope here but, it is even more important to manage the timeline and quantity of materials. This avoids material damage for being unused for a long time, cost of storage as well as cost of unused labor in course of delayed deliveries.
Regular Audits: This includes design audits, quality audits, cost audits and process audits. Possibility of a cost overrun (or even time and scope) can be identified and dealt with at a very early stage, rather than waiting for it to balloon.
Ethics and Compliance: Ensuring adherence to ethical practices and processes in vendor selection, consultant selection, material procurement, etc. – leads to a robust working system devoid of chances of incapability or under performance, thereby saving cost on rework / revision / replacement.
Health and Safety: Adherence and conscious observance of health and safety measures, avoids any health hazards / accidents – which in a long term, saves cost on delays and least to mention, damage to the brand’s value.
as per a cbre survey, 90% of indian construction industry still needs to adapt to international standards on planning & delivering projects. almost 50% projects are affected by health & safety issues (major or minor), there is a 72% shortage of skilled