Cost Controlling in Construction Projects

Cost overrun is a serious issue in construction projects. Despite its proven importance, it is common for a construction project to fail to achieve its objective within the specified budget limits. Cost performance is one of the essential criteria to measure the project’s success. Some of the strategies are presented here to keep the project on track concerning the cost constraints.

1. Accurate Project Estimates

Accurate estimation of the project is the key factor controlling the project costs. Mostly the BOQs that are generated at the time of bidding are not accurate and are made based on certain assumptions. For example, the steel quantity is calculated based on the concrete rather than making bar bending schedules. All the items must be estimated as accurately as possible at the pre-construction stage to evaluate the work’s exact scope. Selecting qualified quantity surveyors at this stage helps in generating a realistic BOQ.

2. Early Contractor Involvement

An integrated design and construction strategy works very well. It is always a good idea to involve the contractor at an early stage to save substantial costs. For example, a designer is considering proposing a reinforced cast-in-place concrete slab for an industrial area having a clear height of 50 feet, but the contractor suggests that the cost of shuttering works for this slab would be very high. An alternate solution is to go for a prefabricated steel slab that can be constructed one-fourth of the time compared to that of the cast-in-place concrete, and the cost involved is also very less.

3. Wastage Control of Materials

One of the most important factors for the project cost is the wastage of material at the site. It includes wastage of raw materials (sand, crush & steel) and consumable items like binding wire, diesel, and shuttering accessories. It is always recommended to order the raw materials in intervals as per the consumption to evaluate the wastage. To save the concrete in piling foundations, we can use bentonite slurry for bore stabilization to prevent over breaks. Similarly, the concrete required in the superstructure should be evaluated daily to take necessary actions timely. For example, batch plant calibration should be checked periodically to ensure the correct concrete mix design.

4. Resource Allocation

Proper resource allocation is the key to project success. After evaluating all the quantities and preparing the project schedule, the next step is to allocate the resources to the project activities. It should be planned at the project start when equipment needs to be hired and for which activities. Realistic planning of the resources helps in achieving the project targets within the budget.

5. Avoid Costly Mistakes

Mistakes always happen when executing projects, but they can be avoided by adopting proper quality assurance checks. One of the most common mistakes is the use of obsolete drawings at the site. If the layout of the building has been revised in the new version, and an older version of the drawing is followed at the site may cause havoc for the project. The changes should be appropriately communicated and timely. Frequent meetings with the project key members and frequent quality checks can save the project from such disasters.

6. Sub-letting Specialized works

A construction project involves some activities that require the services of specialized contractors. Piling works are involved in a project that can be done quickly and efficiently by a specialized contractor. At the start of the project, it should be evaluated what work should be subcontracted to complete them on time and within the budget limits.

Conclusion

Project cost overruns are detrimental to the project, but they can be avoided easily by proper planning and control. A successful Project Manager understands the project’s needs and takes timely actions to finish the project within the prescribed budget. Contact us today for your next construction scheduling project.