4 main risk factors in a construction project
Any project is subject to different levels of risk. The ability to find these risks and reduce the likelihood of their realization requires certain knowledge and skills. When potential risks turn into reality - they can hinder the successful implementation of the project. The right manipulation can lead you to the ability to manage risk, increase profits and improve client relationships, which can lead to the expansion of your business.
Here are four really important factors to keep in mind in construction, along with tips on how you can manipulate them and cut out the situations that can derail your work.
Productivity problems and lack of workers
Lack of sufficient manpower is an important factor in successfully completing a project and meeting goals, especially if additional circumstances come to light that increase the workload. Without the right number of workers, the project will suffer from delays and lead to customer dissatisfaction.
COWID-19 epidemic made a million of vaccancies disappear, from February to March 2020. As of December 2020, the industry was able to bring back 857,000 jobs.
To fill vacancies, construction firms are willing to hire workers with little or no experience. There's nothing wrong with that, but there are some challenges associated with a less experienced construction team. Of course, inexperienced workers won't have the right skills, and that can mean less productivity and the need for additional training and supervision.
No risk of health hazards at the construction site is also a critical factor in the success of your project. Inexperienced workers have a harder time identifying potential hazards in site situations, so safety training is vital.
Investing in the skills of your workforce, paying a decent wage, and building a corporate culture will increase commitment.
You should retain experienced workers, give all your employees options to improve their skills, set up possible career paths so that they always have the motivation to improve and enhance their skills.
The conditions at your jobsite can change quite unexpectedly, and providing a safe working environment will only help ensure the project is completed on time and workers are confident about their health. Major accidents can result in the death of your employees or injuries. You need to ensure that your workers do not have to worry about anything happening to them and minimize all risks as much as possible.
Also, in addition to harming the health of workers, a serious accident can be the reason for delaying or stopping work altogether. This will expose your organization to serious financial losses because of all the costs that can be incurred in the aftermath of an accident.
It is cheaper if you initially, when planning your project, invest in engineering controls and training of your workers than if you were to deal with the consequences of an accident.
Before you start your project, have a safety briefing with your contractors and employees to clarify safety issues. Make sure everyone has reviewed the safety checklist you gave them.
At the safety meeting, include the most important work practices and their pros and cons affecting the task. Introduce workers to personal protective equipment and practice first aid.
Conduct training sessions and meetings with workers at least weekly, educating them about risk reduction tools on the job, changes in the project environment, and working conditions.
A subcontractor who doesn't meet agreed-upon working conditions is also an important factor that affects the timing of successful construction. Delays in one subcontractor's schedule can directly affect the work of others, which can critically affect your project.
Of course, no one starts work by plotting a schedule violation. Subcontractors take significant financial risks even before they receive payment, which can deplete budgets and reduce workflow.
Actively monitor the work of your subcontractors if you think they are starting to fail. Perhaps delays in delivery of needed materials or lack of timely payment to suppliers and subcontractors have interfered with the project.
Try to work things out with your current subcontractor, as a substitution could seriously damage the project as well as your company's reputation.
Don't wait for problems to solve themselves. Contact your subcontractor if you see that there are some shortcomings in the work process. He may not see it himself, but identifying these problems in time will keep your project from losing money.
Before the start of the work process, check the qualifications of your subcontractors in financial terms and in their work skills. Before allowing them to bid, determine who is ready for the job.
Changes in the project
Making changes to a project is an integral part of any workflow, especially in construction. They can lead to critical consequences if you don't know how to handle them. These changes can be initiated by the site owner, a subcontractor, or a general contractor. The changes can be of various kinds. It can be an addition to the terms of the contract, or it can be a drastic change. Usually such changes lead to the need for additional scope of work. Failures in the original plan, in the drawings, or the discovery of deficiencies after construction can result in contract changes.
Changes in the contract are always accompanied by disagreements about the reasons for these very changes, because, of course, changes affect all the parties involved in the implementation of the project. Better yet, make sure in advance that everyone involved clearly knows the list of work to be done, to avoid future changes to your plans.
The way the contract is originally drafted will also dictate the possibility of future changes to this very contract. Perhaps there should be a clause that allows for changes only after they are approved in writing by all parties? Some contracts have clauses that give the customer the ability to request additional work without contract modification or agreement, so resolve these issues from day one.
Cases vary, and sometimes a contract change will not change the cost of the work or prevent the work plan from being completed on time. Negotiate with your client about a possible work stoppage to settle any possible consequences associated with a contract change. Also make sure that all new labor and supply needs are included in the contract.
Always work with your subcontractors, as changes to your contract may affect them as well. Together, evaluate the costs of the change, clarify the schedule, and determine how it may affect their workflow.
Some other risks
Construction projects are also characterized by some other factors such as: insufficiently refined drawings, scope of work, natural conditions at the job site, errors in design, market increases in material costs, and poor management. If you can identify and correct these problems in time, your project has every right to finish on time and be profitable.
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