Undertaking a large construction project is exciting, but it can also be overwhelming. Instead of looking at the project as one big job, it’s possible to break almost every project down into individual phases of construction. Every project involves planning, designing, bidding, hiring, and more — and these are all parts of stages. Once a construction project is finally taking shape, it hits the performance and monitoring phase.
So what is construction project monitoring and performance, and why is it important? To answer those questions, we need to take an in-depth look at this phase.
What is the performance and monitoring phase?
The performance and monitoring stage is a phase in which the project’s progress, timeline, and budget are constantly assessed in order to keep the job on track. By this stage, the majority of the construction is in full swing, and it requires a watchful eye to ensure it’s going off without any major hitches.
There are a few folks involved in this phase. First, the designer or architect will start checking on the project more regularly to ensure that the actual construction meets the plan and design. Also, the general contractor or project manager will check on the subs constantly to ensure that they’re doing the work according to the contract, staying on top of deadlines, and maintaining the budget.
How long does it last?
Essentially, this stage of the project runs concurrently with the construction phase, so the amount of time required for the stage varies based on job size. It typically starts when the actual construction begins and ends upon project closeout.
Before the performance and monitoring phase
Every big project consists of a series of phases. Given that this stage is one of the last, quite a few phases occur before the performance and monitoring phase.
Pre-construction
During this first phase, pre-construction, the project owner will consult with an architect or design firm about an idea or plan. The designer will then help the project owner flesh out their ideas, determine a preliminary budget and timeline, and even assist the project owner in determining whether or not the project is feasible.
Design and development
After preconstruction, the project moves to the design and development phase. During this phase, the architect builds on the rough ideas provided during the preconstruction phase to produce sketches, drawings, elevations, and other features. The architect and the project owner will work closely together to finalize the drawings.
The architect may also assist the project owner in the bidding and contractor selection process during this phase. They’ll submit bid packages, answer requests for information from contractors, and then receive and review the bids to help the project owner make a decision.
Once the project owner selects a contractor, they’ll draw up contracts and the general contractor will start scheduling subcontractors and applying for the appropriate permits.
The construction phase
The final stage before performance and monitoring actually occurs alongside it. The construction phase is the point of the project in which the building is being constructed. While the contractors and subs are working on building the structure, the management team is assessing their progress.
How construction project monitoring works
This phase of the project is primarily about comparing the projected performance set forth in the contract with the actual performance occurring on the job site. This breaks down into a few main areas: the job scope, the budget, and the schedule.
In regard to scope, this phase aims to ensure that the work performed is meeting the plan’s requirements, and that scope creep is not occurring. Constant monitoring of the team’s progress allows project managers and GCs to shift quickly whenever a change or issue occurs. It also provides enough time for corrections if the team makes a mistake. And, since scope creep can get out of hand quickly, careful monitoring helps nip it in the bud.
In terms of budget, the performance and monitoring stage takes a look at the projected budget at certain points and compares it to the actual costs. Discrepancies found at this point might still be young enough that the team can adjust budgets and submit change orders. This aspect of the phase alone can prevent a project from going totally off the rails while taking the profit margin with it.
The construction schedule is also a chief concern of the performance and monitoring stage, and it’s for several reasons. First, the GC and management team want to ensure that the project is delivered on time, and checking with project progress along the way gives them the opportunity to make changes, shift resources, and adapt to delays. Also, watching the schedule helps the project management team verify progress payment validity, allowing subcontractors to get paid faster after submitting a payment application.
Importance of the performance and monitoring phase
This phase might not be the most flashy or cool, but it’s just as critical to a project’s outcome as any other phase. In fact, this can be one of the most important phases for keeping the job on budget and on time.
Most of the mistakes and challenges that occur during a construction project are still fluid at the performance and monitoring phase. This means that the management team still has the opportunity to adjust the plan, seek answers from the design team, and make small adjustments without major changes in the direction of the project.
Financial risks to contractors during performance and monitoring
The performance and monitoring phase is essentially about minimizing risk, but the truth is that it’s one of the riskiest phases of the project. While the hope is that any issues or delays are identified early, anything that slips through the cracks can cost contractors a lot of money in the form of delays and interest payments.
Also, mistakes made during this phase can have ripple effects. For example, if a contractor miscalculates the progress of the job, it could cost a subcontractor their chance at a timely payment. Since subcontractors have bills to pay and interest accruing, the sub has the ability to file a mechanics lien against the property. In the meantime, this mechanics lien can prevent the project owner from securing further financing or from closing on a deal to sell the property.
Because of these risks, subcontractors should be sending preliminary notices and watching their state’s deadlines in order to protect their lien rights. By preserving their rights to file a lien, they can lessen the risk associated with miscalculations or oversights experienced during the performance and monitoring stage.
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