3 Pro-Tips for Major Construction Risk Management Issues

September 13, 2017 Pete Billante

Have you noticed how complex your projects are today vs. ten years ago? With technology like the Internet of Things potentially revolutionizing buildings, infrastructure and the job site, projects are becoming more complex, and therefore riskier, so construction firms need to take a hard look at how they’re approaching construction risk management, and beef up those efforts.


Why You Need to Make Construction Risk Management a Priority

As projects around the world become more challenging, so does the inherent construction risk.

Even small projects are becoming more complex, and demand greater innovation and planning than ever before. New materials, new regulations, new features, shorter deadlines and the drive for greener buildings propel an ever-changing landscape that requires contractors to embrace technology to anticipate and mitigate construction risk if they want to be successful.

Construction Risk Management Complexity.jpg

Today's more complex projects mean project managers have to keep tabs on many different construction operations at once.

Research shows that embracing technology and innovation is an excellent way to improve results as projects become more complex: “Projects are becoming bigger, bolder and more complex – and with complexity comes risk,” KPMG’s International Sector Leader, Engineering & Construction, Geno Armstrong, said in the firm’s 2016 Global Construction Survey.

Armstrong continues: “Innovations like remote monitoring, automation and visualization have enormous potential to speed up project progress, improve accuracy and safety.”

Construction Software Can Help You Manage Risk

The three biggest risks we’re looking at today -- jobsite safety, scheduling risk and cost-associated risks -- can be mitigated or significantly reduced by using cloud-based construction software as a tool to help systematize safety processes, keep the lifeblood of communication flowing, and keep clashes and other issues from blowing a hole in the budget.


Risk #1 - Construction Safety

When it comes to construction safety, having the information you need organized and readily available at your fingertips can avoid a lot of common safety issues. Some of most common safety violations, according to OSHA, are: hazard communication, scaffolding ladders, electrical wiring and machine guarding, to name a few.

Construction Risk Management Safety.jpg


Pro-Tip - Use Cloud-based Construction Software to Manage Your Project's Safety Program

Each of these potential sources of safety risk have dependencies that need to be taken into account like, for example, hazard communication. Employers must communicate about the potential hazards of items like chemicals to employees as well as appropriate protective measures to employees. This can include provisions for:

  • A written hazard communication program for the workplace
  • Lists of hazardous chemicals present
  • Labeling of containers of chemicals in the workplace
  • Labeling containers of chemicals being shipped to other workplaces; and
  • Preparation and distribution of safety data sheets to employees.

Systematizing this - by putting this information in a checklist and ensuring each component of the needed communication is documented and checked off as completed - goes a long way towards ensuring a safer jobsite. Construction checklist software can add a lot of value to this process, keeping all the checklists in one place, and ensuring that your team checks off all the safety precautions one item at a time, giving you a much greater chance at an injury-free project.

Mobile Construction Safety

Something else to bear in mind is that construction safety is going mobile. Another benefit of using cloud-based construction software is that your safety checklists are stored in the cloud, so you can take them with you at the jobsite using an iPad or other mobile device. Then you and your team have the powerful information right at your fingertips precisely where and when you need it most.

This helps democratize safety knowledge and responsibility, enables the use of leading safety indicators, and allows more safety meetings to take place in the very place where they are needed most: right in the field.


Risk #2 - Construction Schedules

Create a Realistic Schedule

While the goal is always to achieve the original substantial completion date, managing those expectations still remains a big challenge. Forecasting the future is difficult, to say the least. Tap all your resources (experience, subcontractor input, production data, etc..) to create a truly effective schedule, and ensure everyone has a copy of it via your construction management software.

Keep it focused on the contract requirements and development at the milestone level. Plan frequently to break down into more manageable durations. Engage the project team in review process and provide feedback in forecast updates.

Pro-Tip - Get Obsessive with Quality Control

The best projects start with great quality planning. Define the quality of deliverables and create achievable goals for the team. Provide checklists using construction quality software for ongoing inspections and examine leading indicators from these checklists to improve the quality throughout the project.

Then conduct QA/QC checks as often as possible. Taking construction quality control to this level front-loads a lot of the work, enabling you to catch clashes or glitches before they can become bigger problems, and saves you time in the end.

Construction Risk Management Quality Control.jpg

Being proactive with frequent QA/QC checks can shave time (not to mention rework and waste) off a construction project.

Just ask IMCO Construction, whose daily construction quality control checks enabled them to:

  • Complete a 1.5 year project in just 8 months - 10 MONTHS early
  • Have only one minor layout error with over 130,000 man-hours worked

Set Yourself up for an Efficient Close-Out

Following the steps above will set your team up for a success throughout the project phases, and lay the groundwork for a successful, and efficient close-out. Remember, a quick conclusion to site activities allows for final payment and teams to move to their next opportunity.

Planning for turnover and setting goals for a short transition is a key indicator of success. Create an expectation for turnover as early in the process as possible, then get feedback from facility stakeholders and incorporate it into the plan.

Risk #3 - Unplanned Costs

Conduct Constructability Reviews and Catch Errors Before You Build

We’ve all been there…Your HVAC systems are in place, only you find that the electrical and plumbing work have fallen behind. Now, the HVAC ductwork in the wall cavity is blocking critical paths for drains in a number of load bearing walls. Not to mention, the electrical work still has to be completed. Time to rip and replace!

Nothing blows through a budget quite like construction rework, which can account for up to 20% of construction project costs, according to CII. Daunting as that may seem, this kind of rework can be prevented by conducting a virtual constructability review via clash detection software, where clashes like the ones mentioned above become visible, and can be resolved before you build.


Pro-Tip - Eliminate Construction Waste: Both Time and Materials 

Something else you can gain by catching clashes during pre-construction and avoiding rework is a much more accurate sense of how much material you really need.

Our customers have told us that having a much more precise view of the entire project using powerful VDC construction software -- and how everything from HVAC to electrical, to ductwork and steel beams fit together --  enabled them to avoid ordering more of the materials than they needed. This cost avoidance has a direct impact on profit margins.

57% of U.S. construction spending is waste

-- Lean Construction Institute, 2015

Construction Risk Management Mobility.jpg

Using cloud-based software on mobile tools gives site workers the information they need at their fingertips, helping them make much more efficient use of their time.

Time waste is another preventable, hiding-in-plain-sight cost that contributes in no small way to project cost and the construction industry’s productivity problem. Using cloud-based construction software to better connect the field with the office, and to manage construction documentation, can have a major impact on productivity.

If everyone on your team has the correct and most up-to-date plan at their fingertips, they won’t experience the common construction project schedule setback of wasting an estimated 90 minutes per day looking around the jobsite for their “stuff” -- current plans, screwdrivers, building materials, etc., etc.

In fact, using cloud-based construction software tools has been shown to increase the average construction worker's productivity by 9 hours per week. Unsurprisingly, 68% of contractors who used mobile cloud-based technology reported improved productivity according to McGraw-Hill’s 2013 study, Information Mobility SmartMarket report.

Summing Up

Construction projects are becoming increasingly complex, and this complexity will only increase with time. This is already raising new headaches for the construction industry, but as with any challenge, it will also raise new opportunities. Advanced technology like cloud-based construction software is available and being improved upon every day, and using these powerful tools can have a significant impact on construction risk management, helping GCs deliver construction projects safely, on-time and on-budget as they rise to meet new challenges every day.


Interested in reducing your construction risk?


Learn how in our free ebook “5 Ways Contractors Can Reduce Rework and Increase Margins”!


Previous Article
3 Awesome Construction Software Projects from 2017
3 Awesome Construction Software Projects from 2017

Dive into 3 of the most fascinating construction software projects of 2017, from the pool of AEC Excellence...

Next Article
70% See Labor Shortage; Construction Training & Technology Can Help
70% See Labor Shortage; Construction Training & Technology Can Help

Find out why 70% of construction firms can't fill craft worker jobs, and what you can do to combat this lab...