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This presentation reveals where things can go wrong during real estate construction projects as companies look to expand in Asia’s emerging markets, and how these issues can be avoided by including a Construction Manager from the outset. To download your free copy of Who's protecting your blindside? Construction Management: Protecting your business from project risk, please visit: http://bit.ly/1hpETvT To learn more about JLL's project and development services in APAC, please visit: http://bit.ly/1iEasVh
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Who’s protecting your blindside? Construction Management: Protecting your business from project risk
Risk management continues to top business agendas…
Top Ten Business Risks Aon’s Global Risk Management Survey, 2013
1. Economic slowdown/slow recovery
2. Regulatory/legislative changes
3. Increasing competition
4. Damage to reputation/brand
5. Failure to attract or retain top talent
6. Failure to innovate/meet customer needs
7. Business interruption
8. Commodity price risk
9. Cash flow/liquidity risk
10. Political risk/uncertainty
Many companies leave themselves open to risk in the delivery of real estate construction projects
When things go wrong on your project in terms
of TIME, COST, QUALITY and SAFETY
Loss of competitive advantage
Delays in getting your product or service to market
Inability to meet customer expectations
Damage to reputation and brand
Inability to attract and retain talent
Failure to meet compliance requirements
Exposure to legal action
Reduced corporate profitability
Disruption of business operations
Impact on cash flow and liquidity
There is a real risk of your project
running over time,
and beyond budget
KPMG’s Global Construction Survey 2012
records that over half of the respondents
see more than 25% of their projects
overrun on the initial bid margin
In the US, 40–50% of all major construction
projects overrun on timing and/or costs,
according to a survey by the Construction
Management Association of America
In Malaysia, a recent survey concluded that
a shocking 92% of construction projects
overrun on time or budget
• Significant delays while damages were rectified
• Major cost impact (no single responsibility for the site)
• Insurances were limited to individuals
• Negative impact on reputation (irresponsible employer)
When things go wrong…
Site flood in India
An on-site flood during a fit-out project in India damaged the site,
the works under construction and space occupied by others.
• Loss in profitability and disruption to business
• Increase in sick leave
• Impact on staff attraction/retention
When things go wrong…
Authority approval and air quality issues
in China
Failing to obtain necessary authority approvals
and not allowing enough time to purge the work
space after construction, caused major delays at
a 50,000-sq ft fit-out construction project.
Risks are hidden throughout the construction journey
• Confrontational relationships
• Lack of flexibility
• Miscommunication
• Breakdown between project phases
• Unfamiliar local market dynamics
• Lack of accountability on site
• Transparency/governance issues
Who is looking after the
production and direction of
your project?
PROJECT MANAGER (PRODUCER)
• Obtain and interpret the brief
• Provide independent advice and
reporting
• Manage and coordinate the design
• Manage and coordinate authority
approvals
• Interface with your internal team
• Administer your contractual obligations
with all parties
• Link between the construction manager
and the design team
CONSTRUCTION MANAGER
(DIRECTOR)
• Provide schedule, cost, logistics and
feasability of construction input during
design stage
• Interface with stakeholders
• Trade contractor identification,
procurement and management
• Site establishment, management and
coordination
• Administer trade contracts including
claims and payments
• Manage the handover to owner
Who is looking after the
production and direction of
your project?
Professional construction management
protects your business
Where do things go wrong? • Unclear scope
• Not enough time or money
• Bad planning and scheduling
• Unexpected changes
• Local market nuances
• Poor trade procurement
• Contractors cutting corners
• No accountability on site
• Insufficient technical knowledge
• Stakeholder confrontation
How can a construction
manager help? 1. Consultancy
2. Coordination
3. Control
4. Communication
Professional construction management
protects your business
What are the benefits? • Avoid delays
• Prevent cost hikes
• Increase certainty of outcome
• Save time and costs
• Minimise claims and disputes
• Reduce HSE incidents
• Quality finished product
Professional construction management
protects your business
For more information, please contact:
Dave Colverson Regional Director
Construction Management, Asia Pacific
+65 6494 3786
Kevin Hastings Regional Director
Construction Management, Australasia
+61 2 9220 8655
Jipu Jose James National Director
Construction Management, India
+91 9884 032 233
Darren Wee Local Director
Construction Management, Singapore
+65 6494 3966
www.jll.com
