Owners, construction contractors and trade contractors involved in major construction projects around the world can reap substantial benefits through adopting best practices in preconstruction, a global survey has found.

But concerns remain that some firms are failing to adopt best practice strategies and are missing out on some of the benefits which preconstruction can deliver.

Published by investment banking and consulting firm FMI and sponsored by construction management technology software firm Procore, The State of Global Preconstruction report involved a survey of 979 respondents from general contracting firms, specialty trade contracting firms and project owner/ public agency organisations from across Australia/New Zealand, UK/Ireland, the US and Canada.

The report aimed to determine current practices regarding preconstruction on major construction projects along with the benefits that effective practices can deliver.

Essentially speaking, ‘preconstruction’ involves contractors working with clients and design teams to plan the construction program before building work commences. This involves development of detailed drawings, schedules, budgets and manpower projections before the start construction.

Through this process, teams work to define the project, prepare cost estimates, identify potential construction issues and solutions and determine the best strategy for construction.

In its report, FMI assessed the performance of survey respondents based on their responses against five ingredients which the firm considers to be important in successful preconstruction.

These include having a formal preconstruction process within the organisation, commencing preconstruction early in the project lifecycle before schematic design, having preconstruction led by either a stand-alone department or dedicated staff, applying preconstruction practices consistently across the organisation and having clear preconstruction roles and responsibilities which are assigned by all stakeholders.

It found that whilst many organisations are performing well, practices in some areas are lacking.

According to the report, among survey respondents:

  • Whilst more than three quarters (76 percent) indicated that their organisation has a formal preconstruction process, almost half (49 percent) of all project owners say that preconstruction processes of their contractors are not well defined.
  • Almost half (46 percent) wait until either the design development or construction documentation phase to become involved in preconstruction.
  • Less than half of all (45 percent) of all general contractors and specialty trade contractors have a dedicated department or staff for preconstruction.
  • Just 32 percent of general contractors and 25 percent of specialty trade contractors consistently follow an agreed upon preconstruction process.
  • Less than one third (31 percent) follow an agreed upon assigned management plan to assign clear roles and responsibilities regarding areas of preconstruction.

According to the report, the importance of preconstruction should not be underestimated.

When done well, preconstruction can deliver greater project certainty and predictability by avoiding mistakes, surprises and the need for rework throughout the project.

When commenced early, meanwhile, preconstruction can also enable important ‘constructability’ considerations to be incorporated into design decisions.

Moreover, the report established a consistent link between the effectiveness of preconstruction processes and final project outcomes.

All up, 40 percent of firms whose preconstruction practices were assessed by FMI to be above average said they experienced greater client satisfaction on projects where preconstruction was done well. Meanwhile, 38 percent and 31 percent of such firms reported higher profitability and fewer delays on such projects.

Meanwhile, firms whose practices are below average still reported benefits on those projects where preconstruction was done well.

All up, 30 percent, 25 percent and 23 percent of below average firms reported more customer satisfaction, higher profitability and delays on projects where preconstruction has been done well.

This suggests that effective preconstruction on individual projects can deliver benefits even for firms whose efforts are less advanced but that more substantial gains are realised by those who apply effective preconstruction more consistently.

To maximise preconstruction value, the report recommends that firms review preconstruction processes, start preconstruction early, invest in dedicated preconstruction resources, involve all stakeholders and leverage technology to streamline preconstruction processes.

In its report, FMI authors conclude that the importance of preconstruction should not be underestimated.

“Investing in preconstruction can provide real returns,” FMI’s authors wrote.

“When these [above-average functions] work collaboratively, preconstruction offers one of the best ways to lessen project risk and creates more predictable and beneficial outcomes.”

Tooey Courtemanche, founder, president and CEO of Procore, agrees – adding that his firm’s preconstruction solution can help users to manage designs, estimates, bids and budgets in an integrated platform.

“The results from the State of Preconstruction survey are clear: investing in preconstruction can provide tangible returns on profit, schedule and client satisfaction,” he said.

“Many of the most successful contractors around the world focus their efforts on preconstruction because ultimately, better planned projects drive better outcomes.”


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