The COVID-19 pandemic has created a lot of disruptions in businesses all over the world, and has affected the economy in general. Each business sector has faced a unique set of challenges. However, in spite of all the challenges, construction companies can continue operating with minimum disruptions by utilizing digital collaboration tools. Contractors can use remote collaboration strategies for completing engineering and management tasks to keep the project moving at a steady pace.
One of the biggest challenges for contractors during the coronavirus outbreak is to protect the workers from the virus while working at the project sites. When following social distancing gets almost impossible, project managers can reorganize activities for minimizing the number of workers required in a specific area, and provide the workers with Personal Protective Equipment (PPE) kit for added safety.
The novel coronavirus has also introduced financial and legal challenges in construction projects. The preventive measures, in such cases involve, cost and time optimization, and clarity in responsibilities split among the owners and contractors. Lack of clarity can lead to legal actions which would further add to the costs and delays in the project.
Keeping all this in mind, let’s dive into the tips that can help construction companies to overcome the project management challenges introduced by COVID-19.
Using Contract Types That Promote Collaboration
One of the most promising concepts that promote collaboration is Integrated Project Delivery (IPD). The goal of IPD is to minimize the conflicts among the parties involved in the projects and minimize waste. This is achieved by identifying activities that add no value to the project so they can be eliminated. Owner, architects, engineering team, contractors and subcontractors are all involved in the project from the beginning, and the profit allocation is clearly stated.
As the profit is allocated in the early stage of the project, a project issue would mean profit reduction for all the parties associated. This helps creating an incentive for effective communication and collaborative problem solving. Thus, with IPD, confrontational approach can be avoided as it affects everyone in the project.
A cost-plus contract with Guaranteed Maximum Price (GMP) is used when conditions are uncertain for a construction project. In this type of contract, the owner pays for all the project expenses plus a fee, which can be fixed or percentage based.
- The contractor makes profit as long as the actual project cost is less than the GMP.
- The contractor loses money if the project costs rise above the GMP.
- In cases where the project cost and GMP are equal, the contractor breaks even.
The project risk is split between the owner and the contractor in cost-plus contract. The helps the contractor by providing a safety margin for unexpected costs, and also sets gives confidence to the owner by setting an upper limit. This type of contract also add flexibility since project modifications can be handled by simply adding their cost and fees to the project. For this reason, cost-plus contracts are very useful in projects with unclear scope.
Preventing COVID-19 with Contech
The term “contech” refers to technological tools used in construction industry. The idea of contech in construction is to improve overall efficiency, reduce project costs, and promote faster delivery. Contech has caught a lot of attention for reducing the risk of COVID-19 protection. With the help of wearable technology, project managers can enforce social distancing measures among the workers and also keep track of the personnel health conditions. Project manager can also detect trouble and risky spots for reorganizing activities to keeping the risks to a minimum.
Drones or Unmanned Aerial Vehicles (UAVs) are proving to be a powerful tool during the COVID-9 outbreak and its aftermath. Architects and supervisors can simply fly the drone over the project site for collecting information, conduct inspections and monitoring as well. Drones have the capability to reach areas that are inaccessible for humans or are considered as risky areas.
The combination of technology, collaborative contract types and effective communication can reduce the risk of COVID-19 in project sites, all while using PPE and social distancing. Owners and contractors should be aware of all guidance provided by local authorities – binding and non-binding. The recommendation is using all prevention measures available, but binding requirements can bring legal consequences if missed.