—
Peter Cheney, Managing Director, Construction Computer SoftwareConstruction Computer Software has been offering software solutions
for the construction industry since 1978. Two years ago, CCS merged with
BuildSmart to combine the strengths of its Candy Project Control system with the
BuildSmart Enterprise Accounting system—providing an integrated solution from
first estimate to final accounts.
Peter Cheney, Managing Director,
Lalu Varghese,
Director, and
Ian Hauptfleisch, General Manager, speak to
Sandeep Menezes on the
criticality of planning and managing risk-free projects.
Risk evaluation is a crucial element
of project estimation.
How can it be handled better?
Peter Cheney: We feel that one
needs to have all information in
place to clearly identify all of the
risk elements associated with
construction. Certainly, the area
that we work on deals with the
entire construction phase—
identifying the cost elements,
their magnitude and quantity as
well as the timing, when those
cost elements are applied to the
project, is absolutely essential.
However, what we do know
about the process is that everything
changes and is not constant;
therefore, it is not a onestop
process. We see it as a continuous
evaluation of all those
risk elements in the project lifecycle.
These risks need to be
quantified; they need to be measured.
If they can't be measured
and quantified, it means they
can't be controlled, which means
the risk profile is amplified.
What are the important points
to remember while preparing
risk management plan?
Peter: The main point is that
controlled prices are not a onetime
thing; they follow the project
throughout its lifecycle. One
needs to be able to measure
what has changed and implement
controls to make sure that
you are looking after the process
at the time it happens. The timing
is very important—it has to
happen at the appropriate time
which is continual. This is not
something that can be planned
well ahead of time and left
alone; those are the key elements.
It has to be controlled
and measured.
The key to any successful
project is in the planning. But
often project planning is
ignored in favour of getting
on with the work.
Ian Hauptfleisch: There are two
sides of any estimate-one is the
money side while the other is the
time side. But lots of people
actually neglect the time side.
What can happen on a project is
that, you can produce your
budget and do the job within
budget. But if you are a few
weeks or a month late, then all
the gains can be lost.
I have actually come across
lack of planning in many
places worldwide. People think
they can't plan because they
don't know. If you have a
decent budget, an experienced
team, know all the elements
involved in construction, and
methodically do the work then
one can put reliable duration
against things.
If you have a programme, then
you have a cushion against the
client. If anything goes wrong
and it's the client's fault, then you
can quickly show him his fault.
Many project managers treat
planning as a day-one job
instead of a continuous process.
Ian: There are a few types of
planning, such as, long-term
planning; let's say, within any
construction project there is
estimation planning. Remember,
when you are estimating
any project, you don't have
much time and are under lots of
pressure. As such, you need to
put a basic plan into place so
that you can generate forecast
and cash-flow.
If you are awarded the contract,
then you need to remodel
that programme again since
construction is going to happen.
On day one, this is your best
guess, because we know one
thing about construction and
that is 'change.' The way things
are done is going to change,
drawings are going to change,
specifications are going to
change, weather is going to
change etc.
So we have to remodel the programme
all the time within the
programme constraints.
There is also short-term planning
like a foreman planning
his jobs for the day or week
ahead. Then you have the promotional
team that plans for the
month ahead.
What are the main challenges
faced by project developers
during the entire lifecycle of
a project?
Ian: One of the main challenges
is the challenge of construction.
The biggest challenge
with construction is the
different variables that you
think you can't control.
But actually, you can control
these variables with experience
and putting budgets and
variables in place, so that you
have something to control
these challenges.
The main challenges encountered
during a project is weather,
price fluctuations, availability
of material and equipment,
equipment breaking down,
overheads not accounted
for properly, wastage, and
other variables.
All these variables make a
project manager's job difficult
but not impossible if you put
the right systems in place
along with proper facilities to
manage everything.
What are the reasons for projects
not meeting schedules in
India?
Peter: We must remember that
one is actually applying
resources to effect the project on
the whole. It means bringing all
resources together and planning
out to manage those resources.
Schedules going haywire mean
the management of those
resources is not the way it should
actually be. To manage things,
one needs to identify the problem
to actually solve them.
Therefore, one needs to monitor
and plan properly to identify
the problem.
But, how can project schedule
and resultant cost escalation
be managed?
Peter: We have a term which
refers to upstream control; in
other words you are controlling
the resources as they happen.
It means that one has to be in
control all the time, so when
things actually go wrong you
know about it immediately.
What makes BuildSmart different
from other construction
enterprise accounting systems
in the market?
Peter: BuildSmart is actually a
cost management control and
accounting system designed
for under-construction
process. It is actually designed
from bottom up. We have been
focused on ensuring that the
process from the original estimate
up to the final account
looks after all the resources.
It makes sure that all the
operational costing relative to
the original estimate and plans
follows the entire process
through the project lifecycle
and into the books of accounts.
This ensures that you are able
to tie up operational costing,
accounting, planning and
estimating into one solid bundle
aimed at project control.
How does BuildSmart adapt to
differential project conditions
in India?
Ian: We understood the project
scenario in India and its
problems long before we actually
entered India. The multiple
taxation system in India
was also a challenge for us. But
we have ensured that cost as
it is implied in a project is actually
true cost; you don't have
to go back and allocate
reimbursable and non-reimbursable
taxes.
How does the Candy singlepackage,
project control system
benefit users?
Ian: We mainly cater to
contractors. When we say contractors
it means estimators,
cost engineers, planning engineers,
commercial managers,
right down to site engineers
and site agents. Depending
on your needs the user may
use different parts of Candy
package.
A lot of projects are also happening
in the hinterland. Do
you have products suitable for
these areas?
Lalu Varghese: A majority of
India's construction companies
are located in metros or
large cities. Therefore, our first
contact with the customer is
always in such metros and
cities. Our products actually
originate from Africa, which is
not very different from India.
Africa also faces the same
problems such as remoteness.
If the information is generated
at head office and made available
on-site, it does not matter
if it is soft copy or hard copy. At
least they have something to
run their contract with.