4 Key Infrastructure Project Delivery Risks and
How to Avoid Them
August 11, 2022
Ultimately, construction project delivery is about handing over a project that meets the owner’s schedule, cost and quality expectations. More often than not, however, those expectations aren’t completely met, and can even far exceed original estimates by the time the project is turned over to the owner. This is particularly common among infrastructure projects where complexity, cost and build duration have often grown over the course of the project life cycle.
Is this due to the methods and processes in place? Or perhaps the mentality of how to approach achieving project outcomes? In truth, it could depend on any number of factors, including the type of project, the expectations, the project management methods or the owner and contractor. When these factors don’t align, it creates conditions for risks to develop that disrupt project performance and progress, and therefore outcomes.
No doubt you’re familiar with some of the more common risk scenarios and the measurable impact they’ve had to your own project delivery. Four of them worth discussing are:
- Schedule delays. Some are minor and can be addressed without threatening the overall project. Others are detrimental to the project and can only be mitigated, not totally avoided by being incorporated into the remainder of the schedule. Schedules are at the mercy of circumstances outside anyone’s control — think pandemic, supply chain glitches and environmental conditions. They’re also vulnerable to situations within the project or your company over which there is more control, such as inadequate risk management, excessive change orders and poor communication.
- Cost overruns. Construction risks often come with a price tag. As with delays, cost overruns are triggered by external and internal risk factors. They can stem from fluctuating material pricing, an unstable economy, inaccurate estimates, changing scope, lack of contingency planning and excessive change orders.
- Compromised quality. Quality is a sign that a project meets design and construction standards and the owner’s expectations. So much of what undermines it is preventable — unrealistic scheduling, late-stage commissioning, hiring of unskilled workers, underestimated material costs or no quality assurance plan, for example. The consequences can include safety risks, rework and litigation.
- Inefficient handover process. Because it’s such an involved process, the moment of project delivery ideally is strategized prior to construction beginning. Unfortunately, it’s often left to the last minute, over-reliant on hard copy documentation and/or doesn’t include current or correct project data.
While this list certainly isn’t exhaustive, these are among the main project delivery-affecting risks. It comes down to how well-prepared you are to respond to them. So the question becomes: How can you best keep these risks from happening in the first place or at least alleviate any severe impact?
Implement advanced work packaging (AWP)
Perfectly suited for large-scale projects, AWP injects reality into the project planning process by bringing the construction role to the planning table — alongside engineering and procurement — to help organize the work from a construction perspective. It breaks down work into manageable chunks and plots them along a timeline called a Path of Construction that runs from the beginning of construction until handover to the client.
These “work packages” detail everything that is needed to complete it — the number and type of site workers, the specific amount and type of materials, the needed equipment and tools, and any supporting digitized information (drawings, material safety data, checklists, etc.).
How does this stave off project delivery risks? There’s improved productivity and less downtime and therefore lower labor costs. It creates conditions for focusing on quality so there’s less likelihood for change orders. And constraints that typically have slowed down progress and impacted project delivery are better controlled for a more streamlined workflow.
Develop a comprehensive risk management strategy
During the planning stage, are you identifying any and all possible risks, making sure to account for those involving safety, the environment, materials, etc.? There are a couple of ways to approach this.
One is to turn to your past project data to surface them, especially if they occurred in similar projects. Taking a good look at what their data analytics show, specifically the schedule performance index (SPI) and cost performance index (CPI), you can ascertain the degree of the impact certain risks had on project timelines and costs as well as whether any backup plans were effective in mitigating the impact. Assess the likelihood of them occurring in your current project so you can include them as what-if scenarios around which to proactively prepare appropriate contingency plans. Determine if there are ways to eliminate each risk altogether or, if that’s not possible, to at least reduce its severity.
The other way is to conduct risk management workshops to help define risks. This comes with the added benefit of boosting the collaborative element of risk management by sharing individual insights and experiences with past risks, what preventive efforts worked and what lessons were learned. The discussions around these, when combined with your data analytics, help produce a more robust, risk-adjusted plan that the project team is more likely to support.
Go digital within an integrated project delivery platform
Delivering a project on time and within budget is a complex task that requires the coordination of many people, resources and activities. An integrated project delivery platform is designed to help manage this complexity as it supports the process and the project team in helping avoid or mitigate the above project delivery risks.
How does it do this? We all know that risks aren’t isolated events affecting just one business unit or site crew. Everyone needs to work together in order to prevent or at least manage them effectively. To make this possible, it’s essential to have access to tools such as planning, scheduling, estimating, document management, commissioning, forecasting and risk analysis, and connected analytics. Having these business functions and their associated data integrated into one platform as a single source of truth means project team members have access and visibility to the same data at any time.
With technology like the InEight integrated platform, teams can collectively identify project delivery risks earlier on in the process because they’re able to mitigate risks by collaborating on solutions in real time before problems arise. It also enables them to track progress through data analytics, giving them more control over budgeting and timing so they can make informed business decisions based on actual results.
Learn more about how we can help your team realize better project outcomes and smoother project delivery through an integrated platform by scheduling a demo.
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