Where there are human beings involved, there will be imperfections. When there is a construction project team working together, problems are inevitable to arise. The most common of these problems are delays of various kinds. The most common kinds of delays include compensable, in-compensable, excusable, inexcusable, critical, or non-critical delays. If these delays, no matter how small in scale, are taken lightly, the problem can spiral into a bigger one.
Consequently, the project manager ends up messing up the project timeline, and the financier, which is usually the owner of the project, ends up paying more than the designated budget of the project. In extreme cases, the construction labor begins to protest or leave the work because of messed up timelines.
This article will throw light on the impacts of construction delays on the fate of the project.
Seven impacts on residential projects if delays are not mitigated
Residential projects are the most common kind of construction project. All consultancies have thus dealt with such projects. If you are starting with your construction project, make sure you hire expert witnesses and a delay expert at the very beginning of the project to avoid ignorance in case of delays. Make sure the consultants you hire are reputable and highly experienced professionals.
Otherwise, the following impacts may become the fate of your project:
1). Time overrun
Construction projects underscore the importance of the job role of a project manager. The reason is simple: the projects are complex, and there are hundreds of small and big activities that the project management office has to schedule and track. If one small activity faces a delay, and there are other dependent activities, the lag will affect multiple succeeding activities.
If you don't mitigate the effects on time, the project may face a time overrun. Time overrun means that the designated time for a project has passed, but significant work is left to proceed towards project closing.
2). Cost overrun
Every project has a designated budget. If the construction work does not progress according to schedule, the project may have to face a cost overrun. The labor cost may increase. The transport cost and equipment purchase expenses may increase over time. Cost overrun can result from a delay in an activity or a time overrun for the project.
3). Loss of profit
If the project’s construction work exceeds the deadlines, there are higher chances of losing profit that you initially expect to form the process. The level of productivity falls, and laborers feel demotivated to continue work beyond their initial commitment to the project.
4). Inferior quality of the completed project
To mitigate the impacts of delays, project managers often speed up the work. For this reason, they need to tweak the original breakdown or schedule of activities. In this way, some of the dependencies of activities face sabotage.
As a result, the outcome of the project may have lower quality than you expected at the time of the signing of the contract. This drawback can be due to the negligence of the project manager or force majeure.
5). Total abandonment
Sometimes, when delays become critical delays, i.e., they exceed the expected deadline for completion of construction projects, the client may abandon the project altogether. The construction company, in such a scenario, will have to face a huge loss.
Unless the owner is getting it built without any construction company’s help, then they will take whole responsibility for the losses. In such a scenario, taking the services of a delay expert from a reputable company will save the project from further losses.
6). Dispute
When delays occur, and the project manager does not handle the matter immediately, it can lead to grievances amongst the teams working on the construction project. These grievances can quickly escalate into disputes and hurt the progress of the project. Hence it is extremely important to take notice of every small delay that occurs in an activity.
7). Arbitration
Things get out of control because the project manager or contractor doesn’t take timely measures for mitigation for a delay issue. In such cases, the matter reaches the brink of seeking arbitration of a third party. Arbitration is then carried out, keeping in view the legal requirements of the contract. Arbitration can lead to penalties towards the party responsible for the problems. Every party has to accept the decision of the arbitration court.
Are you starting your residential construction project soon?
Since you have read this blog now, you are well aware of the delay instances. You may have developed some understanding of the consequences of delays if you do not pay attention to it beforehand. Make sure you only hire an experienced construction project manager. Lastly, you need to keep a quantum and a delay consultant in the loop throughout the life of the project.
