Essential Guide for Project Managers to Save Budget on Construction Projects

This article provides project managers with a full guide on what steps should be implemented to economize while working on a construction project. Get to know the following about reasonable money saving:

· The importance of setting a relevant budget and KPIs;

· How automation helps to achieve the “saving” target;

· The list of apps that will come in handy for project managers while preparing construction projects.

Well, in case you feel that the art of economizing is the thing you desire to get proficient in, keep reading this article to discover more exciting details on that. If you desire to delegate to somebody the task to design the strategy to save money for your solution, an excellent idea for you would be to choose one of more than 1000 global engineering companies and firms whose engineers are proved experts in that.

As an additional portion of inspiration regarding the ways to save money, several great solutions are depicted in How to Reduce the Costs of Intellectual Services for Business and Benefits of Outsourcing Engineering Services . You should check that!

While working on a construction solution, the mission of a project manager is to guarantee that a project is completed. It is a project manager that is liable for scheduling, supervising, and budgeting the solution from top to bottom. Project managers monitor things to run smoothly. Their duty is not only to arrange the project is designed on time but also to implement it within budget.

You might say that it is not a complicated task because, as a rule, project managers are not alone. For any project, they usually find 3D and AutoCAD designers . They get support from civil engineers involving architects and the whole team of contractors. However, having such diversity often triggers the situation getting out of control, expenses increasing at the speed of light, and the solution not being represented to customers within deadlines.

Here are several approaches to consider during the current (or next) solution as a project manager to succeed in saving budget and avoid many other problems.

Specify a Relevant Budget with Realistic KPIs

The secret of creating an efficient budget is to compare the potential expenses regarding a current project with expenses from past solutions. In case the client is new or this is the first solution in terms of design specifics, analyze your budgets from identical projects. If you have already cooperated with this customer, assess previous expenses to identify potential financial risks.

It is impossible to efficiently control a project budget if a project manager hasn't set KPIs. The last support you in understanding the sum spent on a construction project as well as the difference between the project’s realistic budget and the planned one. It would be ideal for a project manager to implement the following essential project KPIs:

· Cost variance helps to understand whether the estimated solution cost stands below or above the fixed baseline;

· Actual cost demonstrates the exact sum spent on a solution to date;

· The planned value indicates the estimated cost for solution activities scheduled;

· Earned value depicts the confirmed budget for completed solution activities up to a certain date;

· Return on investment demonstrates whether a project is profitable and the benefits exceed the expenses.

Integrate Automation within a Construction Project

Automation is considered a great method to significantly compress expenses on administrative overhead. Among the bonuses of automation within a construction project, they figure out optimizing performance (this enables personnel onsite to cope with more responsibilities quicker) and reducing human error that has a cumulative effect. The point is that it makes no difference how productive your team is, automation supports them in doing their work better with minimum mistakes.

Below, project managers may find out several ways automation minimizes construction costs and reduces administrative expenses in total:

· Leveraging submission of documents. Project managers in the construction field are aware of how frustrating preparing necessary documentation can be and how important preciseness is. Automation with the help of innovative construction technology makes it possible to get rid of a big amount of the handwork and expenses included;

· Accounting and budgeting. Here, forget about Excel spreadsheets! They are proved to be the most common reason for human error. Using alternative (but innovative) accounting apps, project managers can easily monitor past actions, total expenditures, budget spent per solution, and potential profits.

How about Workforce Productivity?

The majority of project managers (not only in the construction industry) agree that a wide range of factors influences productivity on site. One of the key factors is your team.

· Productivity suffers in case the following occurs:

· Your engineering team has to work extra hours or even on weekend, leading to exhaustion and around 60% (instead of 100%) of duties being finished;

· There is a lack of engineers/equipment/tools for a certain job

· The work environment is dangerous for life;

· Specific weather conditions become a challenge.

Though several of the above-mentioned things are a part of the work, what you do as a project manager directly affects your team. When engineers don't show the outcome a project manager initially planned, the risk appears to strongly exceed the budget and violate the deadline.

If a project manager accentuates the factors that optimize the workforce productivity, they can easily identify problems in the early stage, and via appropriate actions, they can save the project a decent budget.

Select Cost Estimating Tools

If project managers decide on choosing cost (and time) saving tools, they will manage to save budget on construction projects. When it comes to choosing the tools, don't forget about associated expenses, involving production, installation period, and so on.

Get acquainted with several cost estimating tools to support you while preparing for your next solution:

· PlanGrid;

· QuoteSoft;

· B2W Software;

· Bid4Build;

· PlanSwift.