Need for Project Management
In most construction contracts, the contractor is given only one opportunity to set its price (the bid). From that point on, profits are determined by the project managers ability to save money through better planning of daily operations and the skill to make good decisions. If a project is to be constructed within its established budget and time schedule, close management control of field operations is a necessity. Project conditions such as technical complexity, importance of timely completion, resource limitations, and substantial costs put great emphasis on the planning, scheduling, and control of construction operations. Unfortunately, the construction process, once set into motion, is not a self-regulating mechanism and requires expert guidance if events are to conform to plans. It must be remembered that projects are one-time and largely unique efforts of limited time duration that involve work of a nonstandardized and variable nature. Field construction work can be affected profoundly by events that are difficult, if not impossible, to anticipate. Under such uncertain and shifting conditions, field construction costs and time requirements are changing constantly and can seriously deteriorate with little or no advance warning. The presence of uncertainty in construction does not suggest that planning is impossible but rather that it will assume a monumental role in the success or failure of the project. The greater the level of uncertainty in the project, the greater the need for exhaustive project planning and skilled and unremitting management effort.
Under most competitively bid, fixed-sum contracts calling for construction services only, the general contractor exercises management control over construction operations. Self-interest is the essential motivation in such cases, the contractor being obligated by contract to meet a prescribed completion date and to finish the project for a stipulated sum. The surest way for the contractor to achieve its own objectives, and those of the owner in the bargain, is by applying some system of project management.
Serving the best interests of the owner is the primary emphasis of project control under other forms of contracts. Field management under design-construct, construction management, and many cost-plus contracts is directed principally toward providing the owner with professional advisory and management services to best achieve the owner objectives.