Best CM Practices for Risk Mitigation Management: Part 1

Photo of a construction management team

How do project turn-around strategies apply to my CM project?

In this eight-part series, we will outline turn-around strategies for high-risk construction projects. Not only are such basic tenants and protocols of Anser’s Risk Mitigation Management practice recommended for troubled projects, but we also regularly incorporate many of these principles into our sales and delivery of our assignments as a third-party, construction manager (CM).

The Premise. The general contractor is experiencing a high volume of change, lost profitability, or both. Parties are over‐exaggerating or understating the impacts of those changes. Mistrust prevails. Egos are asserted. Parties are cooperating less. Animosity is setting in.

How did we get here? Was it partnering euphoria that relaxed the attentiveness to potential issues? Was it a weak CM team? Was it a cantankerous contractor? Was it a happenstance of owner/contractor/CM team dynamics?
It is likely that you can put your finger on one or more fundamental causes, but what can be done at this point? In these situations, it is often in both parties’ best interests to immediately return to formalized contractual interaction in order for each party to state its official position for the consideration of the other, without emotion or contention.

Rigorous documentation practices by the CM team are often perceived negatively by the contractor, and as a consequence, many owners are often reluctant to reinstate lapsed formal business processes since they may incorrectly perceive that a permanent, contrary precedent has been set. Despite the contractor’s possible negative perception, such corrections are, in fact, achievable if delicately and tactfully implemented.
Projects seem to go astray when parties don’t recognize extra work. Since formal business practices commonly lapse on troubled projects, one might then theorize that such lapses are therefore a root cause– – and not just a symptom – of the project’s trouble. Such a broad-brush conclusion might not be accurate.

The next installment of this series will distinguish characteristics of a “Difficult Project” from a “Troubled Project.”

 


 

This is an 8-part series called Leveraging for Realignment: Best Practices for Troubled Projects, originally presented at CMAA National Conference.

Contributing authors: Shawn Paroline, SAIC; Mike Kenny, San Diego County Water Authority; Dan Fauchier, The Realignment Group; Jim Linthicum, San Diego Association of Governments; Chris Brasco, Watt, Tieder, Hoffar & Fitzgerald, LLP