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Construction Project Management: A Complete Guide

Last Updated on June 16, 2022 by Admin

Construction project management is a professional service that uses specialized project management techniques to oversee the planning, design, and construction from beginning to end. We have discussed all you need to know about construction project management and the future of construction project management.

What Is Construction Project Management (CPM)?

According to the Project Management Institute (PMI), Project Management is “the art of directing and coordinating human and material resources throughout the life of a project by using modern management techniques to achieve predetermined objectives of scope, cost, time, quality, and participating objectives.”

Read further to know more about construction project management in detail. Also, kindly check below the construction project management process flow chart.

We can extend PMI’s definition to construction project management, wherein a construction project manager uses the same model to achieve the same goal, only in a construction context.

At its most fundamental level, construction project management handles the planning, coordination, and execution of a construction project, whether agricultural, residential, commercial, institutional, industrial, heavy civil, or environmental.

You can also learn about the construction project management process flow chart to implement successful construction project management. Kindly check the various construction project management certification courses online, free and paid, offered by multiple universities and colleges.

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Also, check the construction project management for dummies, construction project management books, and construction project management salary details.



Importance of CPM? 

Construction project management typically includes complicated tasks that can shift wildly, depending on the work. It requires strong skills in communication, deep knowledge of the building process, and the ability to problem-solve.

Construction project management is a complex field, requiring knowledge in many different areas like finance, law, business, and more.

Construction project management, often referred to as CM, is a professional service. It uses specific project management techniques that oversee the planning, design, and construction of a project from start to finish. The most important aspects to control in the construction of our time, cost, and quality.

Construction project management combines the responsibilities of an everyday project manager with someone in the construction industry.

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Types of construction projects

There are various types of construction projects, depending on the various construction sectors. There are two sectors in construction: residential and commercial. Depending on the industry, there can be up to four different types of projects:

  • Residential home building and renovation
  • Heavy industrial construction
  • Commercial and institutional construction
  • Engineering construction

That means there is a wide variety of construction projects that require construction management to be successful.

Construction management might require a simple home to a large bridge, from engineering a dam build to an airport seismic retrofit project.




A construction project manager manages the beginning and end of a project, often managing on-site to ensure safe, successful construction.

The Main Principles of CPM

Construction project management requires various skills and the ability to interface with various agencies and people to lead the project from concept to build.

Construction project managers must follow project management principles during every project phase.

It’s no secret that construction project management is a pretty complicated field. However, there are some fundamental principles that anyone entering the area should remember.

Everything starts with the project owner reaching out to contractors to ask for bids. The construction managers interested in carrying out the project will then offer a proposal to the owner.

The bid will include details about the amount of money that the project owner has to offer to complete.

There are two types of bids:

  1. Open bid: Open bids are inextricably connected to public projects. It’s an auction where any contractor is welcome to make their offer. An available proposal usually is openly promoted.
  2. Closed bid: Private projects are based on closed proposals. The project owner sends a bid invitation to a specific number of contractors.





After receiving all the bids for the particular project, the owner proceeds to the selection of the contractor through one of the following three methods:

  1. Low-bid selection: In that case, the main focus of interest is the price. The construction management companies present the lowest bids they are open to completing the project for. The project owner selects the lowest offer and proceeds with it.
  2. Best value selection: This process puts weight both on qualifications and price. The owner is choosing the most appealing bid in terms of quality and money.
  3. Qualifications-based selection: The present method is adopted when qualifications are the only criterion for selecting the construction management company. A request for qualifications (RFQ) helps the owner to acquire further information regarding the contractor’s experience and project organization competencies.

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Project management process flow chart

construction project management process flow chart
Image Source: https://www.projectmanager.com/



Project Management Processes

Every project has a standard life cycle, regardless of its unique characteristics. This structure could be outlined in four primary stages:

1. Project Initiation

During the first phase, the project’s objective and feasibility are determined. This is a crucial stage of the whole process since it can indicate whether this project is an excellent opportunity or not.

If necessary, a feasibility study is conducted, and based on its results, a recommended solution/plan is issued.

Once everything is decided, a project initiation document (PID) is created. The project initiation document provides the groundwork for the construction plan and is one of the most vital artifacts in project management.

2. Planning Phase

The project planning stage is where the team singles out all the work to be done. It’s an ongoing activity almost to the end of the project. The main priority during the planning phase is to plan the project’s time, costs, and resources.



The project team develops a road map for all involved. This includes the project management plan (PMP), a formal, approved document created by the project manager to guide execution and control and set baselines for scope, cost, and schedule. You can also expect to see these documents in the planning phase:

  • Scope statement and scope documentation: This defines the project’s business needs, benefits, objectives, deliverables, and critical milestones.
  • Work breakdown structure (WBS): This document breaks down the scope into visual, manageable chunks.
  • Communication plan: This outlines all aspects of communication, from goals and objectives to roles to tools and methods. The communication plan creates a common framework that everyone can work from to avoid misunderstandings or conflicts.
  • Risk management plan: This helps project managers identify risks beforehand, including time and cost estimates that may not be met, potential budget cuts, shifting requirements, and a shortage of committed resources.

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3. Execution Phase

The construction project management plan is put to work in the execution phase. As a rule, this phase is divided into two main processes: the execution and the monitoring and controlling. The project team makes sure that the required tasks are being performed.

At the same time, progress is monitored, and changes are being made accordingly. A project manager spends most of the time monitoring and, depending on the information, redirects the tasks and maintains control of the project.

4. Performance and Monitoring

The monitoring phase often happens concurrently with the execution phase. This phase is necessary to measure progress and performance and ensure that items align with the project management plan.



5. Closing Phase (Closure)

The final stage of the project represents its official completion. The project manager evaluates what went well and refers to potential failures. In the end, the team conducts a project report, calculates the final budget, and offers information about any tasks that remain unfinished. In combination with analyzing the potential failures, the project report will be valuable feedback for future construction projects.

The functions of project management for Construction Project

The tasks of project management for construction generally include the following:

  1. Specify project objectives and plans, including delineation of scope, budgeting, scheduling, setting performance requirements, and selecting project participants.
  2. Maximizes efficient resource utilization through labor, materials, and equipment procurement according to the prescribed schedule and plan.
  3. Implementation of various operations through proper coordination and control of planning, design, estimating, contracting, and construction in the entire process.
  4. Development of effective communications and mechanisms for resolving conflicts among the various participants.





Construction management is typically extended to a plethora of different functions. The most important of them could be summarized in the following:

  1. Specify the project plans, including clouding pawing of scope, scheduling, budgeting, deciding upon achievement requisites, and choosing project participants.
  2. Boost resource effectiveness through the acquisition of the workforce and the necessary equipment.
  3. Conduce numerous operations through legitimate coordination and management of contracting, planning, estimating, design, and construction during the whole procedure.
  4. Efficient development of solid communication between the agents for resolving any conflicts that may arise.

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Construction Project Phases | The Stages of Construction Project Management

The stages of construction project work include the following:

Design: The design stage mirrors the planning stage of a traditional project closely. A construction design can be seen as a construction project plan.

In construction management, programming and feasibility, schematic design, design development, and contract documents are involved in the design stage of the construction project.

A design team is allocated to this stage, and it is their responsibility to align the design with all building codes and regulations. Usually, a bidding process takes place during the design stage.

Pre-construction: The construction project work can begin if the client notices the contractor that they have been chosen for the bidding process. A project team will be allocated, including a project manager, construction project coordinator, contract administrator, and construction project engineer.

During this project stage, a site investigation must be carried out. This will allow the project team to discover if specific steps need to be included on the job site.

It is essential to prepare the area before actual construction is begun. Unforeseen conditions are dealt with at this stage, along with a soil test to determine if the soil is in a good enough state to be built upon.

Procurement: The procurement stage of a construction project is when the labor, equipment, and materials needed to complete the project successfully are purchased. The construction company can do this themselves, or this work can be subcontracted.

Construction: During the construction stage, a pre-construction meeting is held. This meeting decides on aspects of the project, such as work hours, quality control, site access, and material storage.

After everything involved in the project is moved to the construction site and set up, construction can begin. A schedule is a contract; your progress payment schedule specifies which project milestones contractors and suppliers will be paid for.

Owner-occupancy: After construction is completed, the owner can move into the building. This is when the warranty period begins. During this period, it is ensured that all the equipment, materials, and quality meet the expectations agreed upon during the design and pre-construction phases of the project and that are outlined in the contract between the project team and client.

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The roles and responsibilities of the Construction Project Manager

The Project Management Institute-PMI focuses on nine distinct areas requiring project management knowledge and attention:

  1. Project integration management to ensure that the various project elements are effectively coordinated.
  2. Project scope management ensures that all the work required (and only the required work) is included.
  3. Project time management to provide an effective project schedule.
  4. Project cost management to identify needed resources and maintain budget control.
  5. Project quality management to ensure functional requirements are met.
  6. Project human resource management to develop and effectively employ project personnel.
  7. Project communications management to ensure effective internal and external communications.
  8. Project risk management to analyze and mitigate potential risks.
  9. Project procurement management to obtain necessary resources from external sources.

These nine areas form the basis of the Project Management Institute’s certification program for project managers in any industry.

A construction project manager has been tasked with several specific responses, like how a traditional project manager is also responsible for some project regions. The primary responsibilities of construction project managers include:

All projects need to be planned. It is an essential part of any project, especially in construction. A construction project manager needs to plan out the project carefully so that everyone involved knows how the project will progress.



Construction project managers are responsible for keeping the project moving according to plan. The goal is to manage the project to finish on schedule and within budget while meeting building codes, programs, and specs.

A construction project manager may also be charged with setting the parameters, finances, and calendar; vetting and hiring subcontractors and on-site workers; developing a strategy for potential conflict resolution; and more.

The Construction Management Association of America, a U.S. construction management certification and advocacy body, says the 120 typical responsibilities of a construction manager fall into these seven categories:

  • Project management planning
  • Cost management
  • Time management
  • Quality management
  • Contract administration
  • Safety management
  • Construction management professional practices (manage the team working on the project, define each person’s role and responsibilities, etc.)


Construction Management Job Titles

There are many different roles in construction project management, with some requiring a more technical background. Here are some of the job titles and their definitions:

  • Field Engineer/Surveyor: A field engineer or surveyor supervises a crew of workers known as the survey party. This party is responsible for staking out reference points and markers to guide the construction process. Before any other work begins, the survey party must define the legal boundaries of the land where the work will be done.
  • Project Engineer: A project engineer acts as the liaison between the project manager and the technical aspects of a project. They are usually the consumer’s primary technical point person in charge of scheduling, planning, and resource forecasting for engineering activities. In some cases, the project engineer is the same as the project manager time, and both roles share joint responsibility for leading most of the project.
  • Project Coordinator: The project coordinator assists the manager in all day-to-day activities. They may liaison between customers, subcontractors, architects, owners, and general contracts on active projects; maintain and monitor records; track budgets; and perform other general duties.
  • Project Manager: The construction project manager supervises projects from beginning to end, ensuring they finish on time and within budget. He or she plans all aspects of the construction process, including hiring contractors, negotiating contracts, setting budgets, complying with building and safety codes, and dealing with conflict.
  • Construction Manager: As a site manager, a construction manager is responsible for running and managing the construction site. He or she works closely with architects to review blueprints, make project timetables, determine material and labor costs, gather permits, and schedule works on site.
  • Operations Manager: An operations manager works in a large construction company that oversees many projects simultaneously. He or she develops construction strategies and works with the project manager to manage resource allocation. They also work with civil engineers to create the quality checks that a project must go through before delivering to the owner.





Construction project management offers many more technical roles and jobs behind the scenes, including design engineer, planning engineer, and project architect, to name a few. But so-called soft skills are just as crucial in completing a project, which is why design managers, project document controllers, schedulers/scheduling engineers, project planners, project finance managers, insurance representatives, and engineered materials representatives are also in demand.

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The Legal Aspect of a Construction Project

A construction project consists of many different details. One of the most vital things no project manager should overlook is its legal parameters. A well-prepared construction project manager should always be in a position to offer answers to potential legal disputes or risks that may emerge. In that way, the whole project is secured and built on solid foundations. In general, five main areas should be taken into consideration:

  1. The parties: This category refers to anyone involved in the construction project (contractors, consultants, sub-contractors, purchasers, etc.)
  2. Contracts: Even though there are certain fixed contract forms for construction projects, there is often a need to change the agreements, so legal advice is more than necessary.
  3. Legislation & Regulation: A solid legal team can ensure that all the different legislation and regulations are correctly followed.
  4. Procurement: The procurement process refers to purchasing all the materials and services necessary for a construction project. It is crucial, then, that the whole project is thoroughly regulated from a legal aspect.
  5. Insurance: It’s no secret that a construction site has plenty of physical dangers. That’s why a project manager should have been informed and cared for every little detail concerning the insurance agreements.

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Construction Project Manager Salary

The average base salary for Construction Project Managers as per the Payscale is recorded on 5th May 2022

The Average Base Salary in India: INR 978,369

The Average Base Salary in the USA: USD 75,707



The Future of Construction Project Management

Whether you are a recent college graduate raised on technology or a senior
project manager with decades of construction experience, the rising digital revolution in project management will change how you work. Read more to explore how digital technology will change some of the key responsibilities involved in PM.

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Time and budget management

Effective construction project management is about monitoring and distributing resources on a project. The PM is responsible for cost and schedule planning, compliance with requirements, approving processes, and mediating conflicts between the project participants.

The traditional approach:

  • Communication and coordination

Relies on emails, phone calls, in-person meetings, and even letters.

  • Information management

There is a greater risk of errors or mistakes with information from several different sources in different formats. Data loss is not uncommon while sharing and collecting information are time-consuming.

  • Resource management

Sometimes hard to locate or correctly identify teams or determine who is responsible for specific tasks. All these factors can cause delays or harm quality. That, in turn, will impact the budget.

The digital approach:

  • Information management

Share and collect information in real-time, ensuring that all teams are up to date without losing any information. PM software also supports the evaluation of KPIs such as average revenue per day and percent of wasted time, and calculating the amount of waste becomes easier.

  • Communication and coordination

On budgets. Digital tools provide a single location for communication and task management for all project members and stakeholders. They also enable cost centers to get quick feedback about the impact of tasks/defects/etc. Digital tools also ensure that only the PM can see sensitive information shared via tickets.

  • Resource management

Easy task management in digital solutions lets you set deadlines and automatic reminders sent directly to staff. Statistics and user metrics give an exact overview of a project and allow for the intelligent allocation of resources.

Digital technologies eliminate many obstacles in traditional construction PM, letting you deliver more projects within time and budget.




Reporting

Depending on regulations or the requirements of participating companies, many PMs must spend considerable time creating reports. PMs deal with numerous reports on topics such as handovers, claim management, or budgets.

The traditional approach:

  • Data collation

It takes a lot of time in the office to collect data from multiple sources and mediums and add everything to a report following standards/requirements, mainly when data lies with subcontractors. It is also time-consuming to add plan excerpts or photographs when needed.

  • Report generation

Depending on the information needed and legal and other requirements (i.e., budget reports, handover protocols), it takes a lot of time to produce reports.

  • Compliance

Difficult to change/adapt layouts with regulations or companies’ requirements. Therefore, manual report generation takes up many hours of a PM’s day – time that could be otherwise spent improving performance on the project.

The digital approach:

  • Data collation

If all your data is held in one software program, you do not need to spend hours searching for, cleaning, and compiling it.

  • Report generation

Data such as the number of defects, rework costs, several passed site inspections, etc., are produced automatically by project management apps. This lets you produce and export complete reports – including text, images, and documents – at the click of a button.

  • Compliance

Digital PM solutions let you adapt existing layouts quickly via drag-and-drop, or you can create your templates for individual reporting. A digital approach to project reporting means you can produce reliable, clear, and legally compliant reports in seconds – saving you hours daily.




Claim Management

Defects or quality issues on projects cost money. Project managers must ensure that the finished building has no defects and is compliant with all regulations to keep the expense of subsequent billing and warranty claims as low as possible.

The traditional approach:

  • Evidence collection

Finding and sharing information about defects is time-consuming, requiring phone calls, emails, and chasing people up.

  • Information management

Prone to errors or mistakes, and information can get lost easily.

  • Dispute resolution

Problems often arise when the PM cannot prove a particular contractor caused it. Put simply, there are far fewer ways to prove who did what with traditional project management approaches, leaving you responsible for other people’s mistakes.

The digital approach:

  • Evidence collection

Data about defects is collected in real-time as text, images, voice notes, etc., using smartphone apps. It can then be instantly shared with the responsible party.

  • Information management

No data can get lost, and it remains accessible anytime in one secure, centralized cloud-based location. It can even be accessed years after a project is completed.

  • Dispute resolution

The PM can easily access and share all data needed to track back tasks and determine who did what and when. All communication and decision-making are also safely stored for future reference.

When resolving disputes using a digital solution, there can be far less doubt or confusion. That reduces your risks and gives you greater peace of mind.




Handovers

Handover processes take up a lot of time as every detail in a building needs to be recorded and put into complete reports. These protocols provide mutual security for PMs, customers, and other parties.

The traditional approach:

  • Report generation

Collecting and compiling information in a handover report is time-consuming, requiring emails, phone calls, site visits, and in-person meetings.

  • Locating information

Information about a construction project is scattered over different places, teams, and companies and held in multiple formats.

  • Flexibility

Defects or spontaneous changes discussed during the handover process cannot be implemented ad hoc into the handover protocol. Traditional handovers are time-consuming and require the PM to spend weeks chasing people up. You didn’t train to become a project manager to spend your days pestering people to send information, yet the traditional approach forces you to do just that.

Using digital solutions:

  • Report generation

Reports can be generated automatically and are delivered in a matter of seconds. Formats can easily be customized to meet the client’s requirements and contractual obligations.

  • Locating information

Because everything is documented digitally, PM’s and project owners can always track completed works, defects, etc. All information about a building project is well documented and held in one place.

  • Flexibility

Changes to the handover protocol can be made ad hoc during the final site inspection.

A digital solution radically speeds up the process of generating handover reports and means you can complete this process in a matter of hours – rather than days or weeks.




Terminology and Acronym Used In CPM

The following are the commonly used terminologies and acronyms in Construction Project Management (CPM).

A&E: architectural and engineering
BOT: build, operate transfer
BOO: build own operate
CIP: capital improvement plan
CM: construction manager
CPI: cost performance index
CPM: critical path method
CREM: corporate real estate management
DBOT: Design-Build use transfer
EA: environmental assessment
EIS: environmental impact statement
EPC: engineering, procurement, and construction
FBOT: finance build operate transfer
FEIS: final environmental impact statement
FONSI: finding of no significant impact
GMP: guaranteed maximum price
JV: joint venture
LEED: Leadership in Energy and Environmental Design
MC: management contracting
MPO: metropolitan planning organization
OSHA: Occupational Safety and Health Administration
O&M: operations and maintenance
PC: project control
PD: project director
PFI: private finance initiative
PL: project leader
PM: project manager
Project Management Body of Knowledge (PMBOK)
PMC: project management consultant
Project Management Institute (PMI)
PMO: project management oversight
PMP: project management plan
PRD: project requirements definition
ProgM: program management
RE: resident engineer
REM: real estate management
RFP: request for proposal
SOW: scope of work
SPI: schedule performance index
VE: value engineering
WBS: work breakdown structure

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Conclusion

The industry demand for qualified project management professionals is increasing day by day. A lot of project management software and application are getting introduced every day.

Also, the employment of construction managers is projected to grow 15-20 percent from 2018 to 2026, faster than the average for all occupations. Construction managers are expected to be needed as overall construction activity expands.

So, to overcome the future skill gap challenge, studying construction project management will be an added advantage for the Civil, Mechanical, Electrical Engineers, Architects, and other engineering graduates.

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