In today’s world of technology and transparency, let’s deep dive into the requirements of successful execution of projects. Sharing herewith the tried and tested implementation of Project Development Strategy (PDS) to enhance professionalism.
In article 2.1, we have observed that Project cycle has 31 activities which are divided into 4 segments.
- Investors on board
- Design and Processes & System
- Execution and
- Completion
The project development strategy is a subset of the Execution segment.
Objectives of Project Development Strategies are as follows:
- Create transparent processes and systems
- Define broader responsibilities and accountabilities
- Enhance effective utilization of time
- Frame basic principles to be adhered at project level
- Identify and Mitigate various risks to the project
- Set up regular monitoring and controlling practices
- Target higher level of professionalism
- Understand the SWOT analysis
- Value the need of written communications by creating a document to share it with all relevant parties, so that everyone should be on the same page.
By generating Project Development Strategy, all relevant team members are not only sharing their responsibilities but also being aware of other team member’s roles who are actively partnering in the project.
For success of any project, execution management is very critical and hence it is vital to have effective written communications with all stakeholders (owners, board members, investors, architects, various consultants, contractors, suppliers, head office as well as project level executives of all relevant departments), to strengthens and coordinates the outcomes (deliverables).
Project teams need clarity on all fronts to execute projects effectively for which proper coordination is required amongst all stakeholders. For example: Business development team about business goals in terms of agreed profitability of project amongst all financial partners, Design team for coordination with design architects, liaisoning architects and all associate consultants, sales & marketing team, Cost management team with planning, design, suppliers, contractors, finance teams, Planning and Monitoring team with business development, design, legal, cost management, senior management, project team, sales and marketing team. For noteworthy execution, lots of activities need to be completed in a defined way as many of them are dependent on preceding activities or in concurrence with other activities, hence coordination is required at multiple levels, in series or parallel.
PDS documentation generally consists of project description, team, design consideration, planning & scheduling, budget, cashflow, contracting, procurement, marketing & sales, SWOT analysis, statutory requirements/Finance, resource allocation, quality, environment & safety, risk analysis & mitigation and monitoring & controlling.
PDS creates a sense of responsibility and gives clarity towards expectation of delivering the project requirements on or before time. PDS is Instrumental in carrying out value engineering to uplift project parameters with the help of latest technologies, innovations, alternate methodologies and detailed engineering & analysis with due consideration for all statutory requirements.
PDS is also helpful for third parties such as investors, financial institutions, auditors, consultants to have transparency in execution and this improves credibility in the market.
Project owner decides who will prepare this important document but generally the planning team interacts with all departments and agencies to collect relevant information for documentation.
Contents in Project Development Strategy may vary from Project to Project as well as from Organization to Organization and/or should consist of the following. The documentation can be enhanced by sharing drawings, charts, sketches, photographs, attachments, wherever possible to improve presentation.
- Project description: Should consist of the basic details of the project which will be referred by respective agencies throughout the duration of project. Such as, Name of the Project, location, google map, infrastructure and connectivity, type of project (Residential, Commercial, Office, retail, hospitality or mixed use) development potential (Sqft per building wise, amenities, total), phasing planning, area calculations (Carpet & Built up area for sale, construction area), structural details such as number of stories, wings, basements, floor areas, each floor occupancy details, specifications, allocation of amenities / services, parking plans, landscape. Few drawings such as, elevations, sections, plans, and any other special features.
- Team on board: It is essential to know about all the agencies involved or planned to be involved in the project, hence keyin the name, contact details (phone & email) and office addresses of architects and consultants, contractors, suppliers along with respective Head office and Project office. It will be wise to explore creating communication hierarchy within and outside respective organizations. This will be helpful to communicate with assigned people from each organization.
- Design Elements: Few considerations such as, Creativity during concept stage, use of latest technology or innovation from respective consultants, inputs from proof consultants, value engineering from project team. It will be helpful to enhance the project parameters over the duration of the project by revisiting detailed inputs from architects and consultants about special features of the project. Sometimes new technology, innovative products ease out not only numbers of activities but streamlines multiple concerns improving durability, aesthetics and life span.
- Planning and Scheduling: Senior management is monitoring and controlling project parameters, hence the master planning should be inclusive of phase wise development and targeted milestones. Also key in details of broad level planning for execution of a project considering various constraints. Share a broad schedule highlighting key intermediate milestones (Approvals, Design development, Structural, Finishing, Services and external development works, practical completion and Handover) to track progress on critical paths. If possible, to improve productivity, detailed schedules should address timelines for contracting, procurement, HR & administration processes and it should be shared with respective team leaders who will be using it to map required timelines by assigning defined work to team members.
- Budget: Important for senior management of any organization is to work within defined budget parameters and control the expenses. Abstract of budget wherein soft cost as well as hard cost can be shared on sqft basis as well as total amount. Generally soft cost includes architects and consultant’s fees, finance and legal expenditures including land, approval and taxes, marketing and sales costs, project administration and overheads. Hard cost includes site development works, structural, finishing, facade, services (plumbing, fire fighting, HVAC (Heating, ventilation & Air conditioning), electrical), external development cost (Sub-station, cabling, storm water drains, STP, water tanks, chilling plants, landscape both hardscape and softscape, club house, swimming pools, roads, compound wall, security areas), and interior works, if it is part of scope of work. For budgets of hospitals and hospitality (hotels) sector, there will be addition of operational items such as machineries, equipment, furniture & furnishing.
- Cashflow: Senior management, Finance and business development team gets involved in streamlining cash flow. Preferably quarterly cash inflow as well as outflow should be shared to understand the importance of progress as well as source of funding. Proper one pager abstract of cash flow will be helpful for all concerned to monitor and control project parameters. Generally monthly review of cash flow happens from respective authorities but quarterly review of cash flow is important in board meetings.
- Contracting: Detailed documentation with required terms and conditions are important for any contract to avoid claims over duration of project. Hence strategy needs to be shared whether contracting is centralized or decentralized or partly at head office and at project level. Also other processes such as preparation of bill of quantities, floating tenders, shortlisting, negotiations, award of work (work order, contractual documents) and billing processes (from bill receipt at project level till receipt of payment to vendor), should be highlighted. Types of contracts such as turnkey, with materials, partially client supplied material, labour for major contracts should be keyed in.
- Procurement: Quantity plays an important role in determining the price of material, more the quantity then there will be a possibility of additional discount and better credit facility. Generally the organization’s policy is to have procurement from the Head office, however based on timelines few materials can be procured from the project office or as per size and number of projects in an organization. Procurement process (Generation of requirements till reconciliation of material receipt at project level to certify bills and receipt of payment by vendor) should be shared including the credit period for payment from vendors at least for major items, which is helpful in fund management.
- Marketing and Sales: Being a source of cash inflow, it develops enough pressure on marketing and sales leaders for framing strategies. Marketing team focuses more on digital platforms (Use of data, technology and analytics) for branding the project apart from use of outdoor media, public relations for advertising and promotional event. Sales team concentrates on pre-sales and post sales activities. Pre-sales team frames strategy of taking help from multiple sources (channel partners, media, hoardings, portal) to increase or achieve targets whereas a post sales team focuses on customer relationship management (details of how the team will execute post sales activities). Appointment of various agencies for marketing and sales should be decided and highlighted.
- SWOT analysis: It will be beneficial to carry out SWOT (Strength, Weakness, Opportunities and Threat) analysis for the particular project. For example : Strength would be location, design, amenities, specifications, Weakness can be an approach road, noise pollution, Opportunity can be venturing into different segments in the next phase or building top quality products or better specifications to beat the competition. Threat can be a big planned development in nearby areas in the near future. This analysis will be helpful especially for marketing and sales, designer, planning and costing teams to focus on innovations for addressing weakness (by installing noise barriers) and threats (by developing unique products different from the competitors) and improving strengths and opportunities.
- Statutory requirements/Finance: All requirements with respect to the Real Estate Regulatory Act should be shared, which will be beneficial for monitoring and controlling purposes by respective teams. Taxation, Insurance, labour licenses, contractors all risk policies, workmen compensation policies, provident funds, professional tax, GST and all other legal matters as per company laws, third party consultants for audits (Internal as well as External) should be indicated.
- Resource allocation: Share the types of resources planned for the project with main contractor/subcontractor/inhouse team, such as equipment, machineries, (Tower crane, passenger hoist, material hoist, suspended platforms, reinforcement work with the help of bending, cutting, threading machineries), special materials for formwork & scaffolding (aluminum, hybrid formwork, steel, tube and coupler, H frame), and also types of manpower like specialists, skilled, semi skilled and unskilled. Use of the latest technology, equipment under new methodology can be shared with details.
- Quality: Major advantage of constructing a quality product is to save timelines in future (such as identifying the problems, working out the possible solution and arranging resources to execute work), saving rework cost and building a brand image. Proper execution with defined quality assurance and control not only increases life of the project but also reduces maintenance and repair costs over the project life. Hence sharing inputs from Quality manual, quality assurance and control documents is essential, such as testing of materials (cement, steel, flooring, water proofing) in defined intervals or as per Indian Standard codes at project level or at testing laboratories. Also frequency of Inhouse audit and/or third party quality auditor to adhere to defined standards during execution should be highlighted.
- Environment, Health and Safety: Organization’s policy for EHS at project level should be explained along with the controlling factors such as weekly/monthly report and audit from head office or if required third party audit followed by action plan for controlling EHS. Organizing any events (Health checkup, safety week, monthly awards) to improve the importance of EHS at project level should be shared.
- Risk analysis and mitigation plan: Let’s accept the fact that it’s very important for the health of the project to key in all risk factors (Internal as well as External) and carryout brainstorming for mitigation planning and execution. All legalities with land parcels, uncertainty in development norms till approval stage, time required for various approvals including environmental clearance, airport authority, high rise committee. Fluctuation in manpower deployment (all levels, from engineers till unskilled workers), working time restrictions, use of sophisticated equipment/methodology due to soil conditions, adjoining structures. Time considered for long lead items as well as funding, marketing & sales assumptions.
Develop table determining likelihood Vs Consequence as indicated below
- Monitoring and Controlling: Is important for senior management and hence strategy for implementation of monitoring and controlling can be framed efficiently for effective results. It’s a continuous process from initiation stage till completion stage of the project and if adhered diligently then results will be within defined targets or beyond expectation. Monthly reports from each department, project visits of senior personnel from head office, third party visits and reports, weekly meetings amongst various departments followed by monthly meetings with senior management and quarterly meetings with stakeholders for updating as well as approval of major changes, if any. It is known that the project’s success mainly depends on timely decisions and direction from senior management to all concerned agencies. In case of an inclination of use of technology by senior management of an organization and if ERP (Enterprise Resource Planning) software is implemented in an organization, then monitoring and controlling can be more effective
The benefit of creating this document is to save precious time for all concerned by not spending time narrating the same project details to various parties over the entire project duration. Someone who reads these documents will be happy to interact with concerned personnel for a few minutes only, if required. Both parties are happy to interact precisely on additional information, if any or meeting will happen for sharing a good gesture on achieving a high level of professionalism.
Conclusion:
To improve professionalism in an organization and address various recurring issues, one of the best practices is to create Project Development Strategy and share it with concerned teams. The probable unnoticed outcome of having this document is contractual benefits. Each person/associated organization will be comfortable to resolve issues, if any, because of detailed documentation indicating expectation and coordinated performance. Also one of indirect benefits is that there will be no blame game and unnecessary use of authority as well as shredding of responsibilities from any of team members. Project development strategy will be beneficial for outgoing as well as incoming professionals to not only understand the project parameters but also to catch up the pace of project progress and related requirements.
2.1 Flow chart for Project Life Cycle
31 Activities – From land till financial closure
2.2 Detailed Project Life Cycle
Lead role, Teams, Decisions and Decision makers
2.3 Importance of Time, Cost, Quality and Processes & Systems
Introduction of fourth dimension to universally accepted triangle
2.5 Project Budget: PMC & Template
Preparation, Monitoring & Controlling the budget.
180+ items in 2 segments & 8 sections