How Planning Throughout
Project Execution Averts Risk
August 18, 2022
Construction is built around plans. Those plans involve more than simply organizing how, when and where job tasks will be done, and saying “go!” They have to also ensure those tasks will be free of the constraints and risks — known and unknown — that can throw them off track.
That’s why planning doesn’t end when the first shovel hits the ground. This is because capital projects have become more complex and highly technical, which means they’re constantly vulnerable to more than just traditional risks like labor shortages, weather delays and material cost increases. Therefore, executing on these projects requires adapting your plans based on what you learn as the project progresses and making changes in response to unexpected challenges and problems. Think of it as a risk management strategy, one that isn’t static but rather fluid to allow for ongoing planning updates.
So how do you adequately plan for managing and avoiding risks once construction is underway?
Avoid or mitigate risk by using analytics as a planning tool
Data analytics may sound a bit daunting to some, especially if there’s any apprehension about trusting the direction and success of a project to something unfamiliar. But sticking with the familiar way of doing things is also often one reason intended project outcomes aren’t being achieved. Now’s the time to make analytics your friend and let it help you plan for the knowns and unknowns.
Planning from a risk management perspective means relying on data to spot potential problems before they occur or worsen, creating strategies to avoid them or mitigate their impact when they do happen, and continuously updating plans throughout the execution process so you’re ready for whatever comes next.
Which analytics will help you most with project outcomes? Specifically earned value management (EVM) metrics, which include schedule performance index, schedule variance, cost performance index and cost variance. Their metric values not only help you gauge progress throughout project execution, but also wave flags alerting you to a sudden or trending deviation that may indicate a brewing problem. Because EVM metrics are so sensitive to developing risk factors, they’re able to tip you off with enough time to investigate it further or take action immediately if needed before it becomes a problem with your project timeline or budget.
Analytics not only helps you sidestep the majority of common risks but gives you more control in delivering on project outcomes with a higher degree of predictability and certainty.
Empower your project team to identify and avert risk
It’s not just analytics that can help plan around risk factors. There’s a wealth of experience among the project team ready to set foot on the jobsite who can bring firsthand insights into risks they’ve witnessed and the success or failure of any mitigation efforts. Risk workshops provide the ideal setting for team members to contribute their experience and seasoned knowledge as it applies to the proposed work scope.
With analytics from similar past projects providing a foundation on which to base risk management discussion, these workshops become a collaborative effort in identifying, assessing and planning around the risks surfaced not only from that prior data but from each team member’s unique perspectives and experiences with those kinds of risks. What results is a more realistic approach to project planning, one that is risk-adjusted yet still data-driven.
Everyone should feel empowered, even once construction is underway, to share observations when a previously unmentioned risk occurs. Risk is a shared responsibility; neither the contractor nor the team wants to be blindsided by a detrimental event or situation that someone suspected could occur but didn’t say anything.
Beware optimism bias
It’s one thing to make assumptions that everything is okay and deny anything could go wrong with a project. It’s quite another when this mindset interferes with making sound decisions and taking appropriate actions. The result is unmet expectations that unravel during project execution — and a whole lot of explaining to do. It’s an unrealistic and ill-advised way to plan projects and can stunt any efforts toward reworking things when necessary throughout construction.
The thing is, while it can sometimes be a calculated effort, it can also be rooted in genuine well-intentioned belief. This is what makes optimism bias such a deceptive risk factor. The sure way to counter optimism bias? Realism found in fact-based data. In this case, it’s those EVM metrics. Their constant fluctuations serve as an always-open window into a project’s financial, schedule and operational health, indicating when a likely risk requires attention. EVM, in combination with forecasting, is an essential component in making data-driven, risk-adjusted, nimble planning possible throughout project execution.
Have construction planning software in place to detect and reduce risks
One thing that can help tie all of the above together is a solid construction planning software option. Why industry-specific? Actually, one of the reasons project outcomes miss the mark is reliance on traditional or legacy systems; where once they performed efficiently, over time they’ve fallen short as those outcomes have become more pronounced when working on complicated, increasingly technical projects. Adopting a solution that incorporates all the nuances unique to construction helps you respond to the specific challenges and risks that can occur in today’s capital projects that must be more closely managed. This software is designed to take on the heavy-duty functionalities of the planning process. This means risk analyses of various what-if scenario outcomes, proactive notification of time-sensitive updates and changes that impact timelines and real-time dashboards reflecting data that help inform ongoing decision-making. All of these will help to lower the chances of risks impeding project progress.
While even the best planning will never make up for poor project execution, good planning can help you navigate unexpected challenges and avoid risks to stay on target. Technology like InEight construction planning not only streamlines this process but provides a line of sight into the risks that can impact project outcomes so you can better plan for them at any point during construction. A demo can show you how this can benefit your team.