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The Big 5: Warning signs to spot risks on construction projects

BCLP experts: The Top 3 warning signs on construction projects are related to design, programmes, and the project manager

The Big 5: Warning signs to spot risks on construction projects
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The Big 5: Warning signs to spot risks on construction projects

With construction projects in the UAE and the Middle East growing rapidly in scale and complexity, the challenges faced during and after these projects – including delays, cost overruns, disruption, change control, and performance disagreements – are also increasing.

Yet, there are sufficient warning signs that can help troubleshoot these risks before they begin to adversely impact the quality and the finances of a construction project, according to experts from Bryan Cave Leighton Paisner (BCLP) who shared their insights at The Big 5 exhibition and conference.

Providing a context for these warning signs at the 40th edition of the region’s largest and most influential event for the construction industry The Big 5, the head of construction disputes at BCLP, Richard Davies, said: “A common statement that we hear from people in the industry is that they wish that the project team had made them aware of the problems that they were facing a little bit earlier, because then they might have been able to deal with it.”

In an attempt to address this gap on identifying the red flags in a project, BCLP released a report titled 10 Early Warning Signs: Spotting the Risks in Construction and Engineering Projects, which Richard Davies as well as Richard Dupay, senior associate at BCLP, Richard Dupay, deliberated at The Big 5 event.

They shed light on the Top 3 warning signs based on repetitive issues identified while dealing with 750 clients in more than 40 countries across various sectors.

“The three issues that came up time and time again were design, programmes, and problems with the project manager or contract administrator,” Davies said.

Projects in the Middle East are under immense pressure in terms of time and delivery schedules. This has an impact on designers, architects, and front-end engineers, who are pressed to deliver designs early, quickly, and even reluctantly.

“The risks inherent in this approach is that the designs are not scoped out properly. It remains incomplete; the design concepts are insufficiently developed; and there’s poor coordination with contractors and a lack of input from those who know whether the design can actually be built,” Davies added.

Highlighting the warning signs for design problems, Davies spoke of a large number of requests for information (RFIs) or claims notices; designers correcting deficiencies; designers’ response time slowing down for RFIs and revisions; as well as arguments over whether design changes are actual ‘changes’ or design development.

Similarly, Dupay shed light on the key warning signs in programmes that could lead to project issues, including the lack of a timely submission of a programme; programme’s submitted only in a PDF format rather than in a native format; insufficient detail in the programme; lack of regular updates; current programmes becoming unrealistic; and routine rejection of programme’s submitted by the contractor.

“Programmes are monitoring tools. A properly detailed and updated programme allows both parties to monitor progress against the programme. When done properly it should enable to predict the impact of events such as variations in the scope of work. It’s also a planning tool, which can help both parties to plan the next step of a project. It can also be used for dispute resolution purposes. For instance, if disputes arise, and they often do, an updated programme can help assess what went wrong compared to what was planned to happen, which means that disputes can be resolved quickly and relatively cheaper,” Dupay said.

In terms of the role of the engineer or the project manager, the role itself has an inherent conflict of interest, as the individual or the firm taking on the role has an obligation to be fair to the building party hired to do the job, but is also appointed by the employer.

“The main warning signs to watch out for with regard to the project manager include those who tend toward the extremes of either agreeing to all the claims or denying all the claims; those who don’t coordinate with the contractor or the design team; and those who are not facilitating the collaboration of a live project, and are therefore, simply not doing their job,” Davies concluded.

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