Aurora Covid-19 Practical Advice
Back to basics for Project Management and Cost Control
Prepared by Jonathan Young, MRICS. Associate Director, Aurora Construction Consultancy.
Wash your hands, look after each other and avoid unnecessary contractual journeys. As with most professional practices, recent conversations with our Clients, investors and project delivery teams (both in design and in production) has led to a similar trend of questions regarding the Covid-19 event.
What is the risk and what does it mean to my project? …In other words, tell me the facts so I can understand what to do. The honest answer is that time will likely slip, and people will be concerned, but the cost effect can be managed and there are options so that value of the project is maintained.
The impact of the Covid-19 event is unique in that it affects all society, not just a specific country, sector or project. It’s not even a construction related issue, but a health issue. However, the remedy to understanding the risks and their potential impact upon your construction project lies with the professionalism and experience of your Project Team. Yes, the infection of conflict is a real possibility, however with Project Management and Quantity Surveying (Commercial Management specialists) skills it is possible to understand why the conflict may occur, so the Project team can limit or avoid it’s impact and maintain a safe and cost effective project during and after the Covid-19 event.
More important is compassion and trust in how we act and treat each other. Anxiety and Mental Health will become a real issue for everyone and will be unique to everyone from, fear of the virus, self-isolation and possibly the loss of loved ones. Clear lines of communication will be vital to allow people to understand their way on the Projects path along with their Team members.
Our team members bring an honest, value driven project delivery. This is how we believe Project Teams can share the project values, take accountability and trust each other in challenging circumstances.
Wash your hands – Protect your employees First things first! Ensure your Employees safety. The Covid-19 event is public health pandemic. Does your project work environment (office and on site) follow the guidance of your Government? Contact your suppliers also to ensure that they are also compliant.
The advice from Health experts is that it takes 20 seconds to wash your hands thoroughly. Take this time to perform a Project “Health Check” or “wash” your project? Consider the duration of your contract. It is likely that your Team will remain in Contract throughout the duration and recovery of this Covid-19 event. A fair, pro-active and transparent approach will likely find a collaborative path, whilst maintaining each party’s integrity.
Focus the Project Team. Clear lines of communication are vital. Use one communication platform. Encourage video conferences in all meetings and allow everyone in the meeting to contribute. Request a response to the following points:
- Remember that you and your Team were brought together to successfully deliver the Project Goals. Review those goals and either maintain or adjust them.
- Assess the value of work done to date, value your liabilities (change and claims)
- Cash statement
- Progress in Design and on site
Procurement status of sub-contractors and suppliers. Can they still deliver?
- Outsider help
- Review if your Investors policy has provided support to your Project Team.
- Review what your local government policy has provided to support your Project Team.
Manage notices, be clear with Other parties of any potential or real concerns
- Upstream to Clients and Investors and
- Downstream to design and production Contractors
Records, records, records.
- Document daily activities, resource levels and any events
- Refresh and upskill your team
Look after each other – Throughout the duration of the Covid-19 event Protecting jobs and mental health will allow your Team to progress. Can you support your Team with access to support, time-off or a change of working conditions? If your Project is slowing down, consider voluntary or staged leave. Encourage upskilling so your team is robust in the event of any key members taking leave. Many online platforms have opened their training resources.
Health and Safety.
- Understand what, if any, new statutes or regulations have been brought into place.
- Prepare a costed assessment to understand any time or cost impact.
Cashflow, ensure fair and timely payment.
- Cash flow is a common reason for contractors and sub-contractors becoming insolvent. This can be catastrophic for a project in terms of time and money. It is in the client’s interest therefore to ensure that the supply chain is paid promptly.
Mitigation / Acceleration strategies.
- Make informed decisions with a costed assessment to understand the benefit.
- Are they practical? Has social distancing and shared workspace affected your project?
- Could acceleration measures intensify the situation?
- For significant proposals, bring all parties to the table.
Collect, review and manage project data:
- Project Controls brings the Project Team to the table to understand the Project data.
- Technology vs. Traditional. Have your systems remained operational?
- Time Schedule. Off-site and on-site. Has a delay in one area of the Project, opened an opportunity in another?
- Resource availability. Can you use what is available, rather than what you think you need?
Procurement strategy – If your ‘Plan A’ is in doubt:
- Design obligations, is there an opportunity to clean those hard to reach places of your design before handing the risk (value) to the contractor?
- Fixed price or Cost plus, what is the incentive with the current uncertainty?
- Local or imported supply chain, is there a new opportunity with local suppliers or alternative materials?
Avoid any unnecessary journeys – From recovery through to project completion When the circumstances change for better or worse and the world starts to re-open, bring the Team together again to reflect on the outcomes of the points above. Regroup and continue making progress.
- Review the and again either maintain or adjust them.
- Has your Project Team developed a successful way of working?
Green shoots of recovery
- Where can the Project begin to scale up the delivery?
Give and receive.
- How has the rest of the industry faired, can you share your good experience or learn from others?
- Did those events become real? Prepare costed assessments for negotiation.
Continue good relationships
- Adversity brings people together, encourage it to continue for the future! Despite the uncertainty surrounding Covid-19 and the lack of clarity in terms of its timeline, you can achieve certainty of outcome for your project through proper planning and through the integration of commercial management specialists such as Quantity Surveyors. Costed assessments allow Project Managers to make informed decisions. Contract administration experience allows the Project Team to have clarity of communication and confidence in their rights to payment for performed work.
So, what is the risk and what does it mean for my project? Aurora’s service offer… You might be considering your options in relation to your specific project. In all likelihood one of the following:
- Continue as best possible to completion
- Reduce/rationalise developments
- Consider alternative development opportunities
- Stop your developments
Any of these strategies will require specialised advice and planning to ensure your project progresses through the crisis in the best possible position. To understand the facts and prepare for your next phase, we see the current period as an opportunity to undertake a Project “Health Check”. This review will ensure there is an accurate picture of status of your project in terms of physical works, commercial and contractual enabling alternative future scenarios and forecasts to be as well-grounded as possible.
The specialists you require are trained Quantity Surveyors who carry professional expertise as qualified quantum experts. Aurora performs a number of services that will provide evidence-based solutions as a basis for our recommendations. Supporting your Team towards the best path forward, evaluated against each strategy’s success criteria.
Please contact the following for more information: James Pearce, MRICS CEO J.Pearce@aurora.cc +45 5354 6135 Warwick Kendrick, MRICS Senior Director W.Kendrick@aurora.cc +46 736510718
Jonathan Young, MRICS Associate Director J.Young@aurora.cc +46 704032702
Wash your hands, look after each other and avoid unnecessary contract journeys.