How Project Management Software Helps Eliminate Disputes on Construction Projects

A shared project website helps all parties execute their responsibilities. Project management software can jumpstart the chance for success from commencement through ribbon cutting.
By Josh Levy
May 31, 2019

The best ingredient for a successful project is up-to-date and accurate project information that is available to all parties involved. Disputes are avoided when everyone from the owner and the general contractor, to the design team and the subcontractors, has access to current project records.

Lately more products have been developed to provide a single web-based portal to manage the project documents from bidding to punch list. When each stakeholder uses a well-managed project website during construction, the whole team enjoys better communication and disputes are avoided or resolved more quickly.

Regardless of the size of a project, there are common causes of disputes. From preconstruction work to developing schedules and managing submittals and payments, many problems are the result of poor communication and recordkeeping. General contractors use project management software to collect, organize and circulate information in a timely and comprehensive way using mobile phone apps and web-based software. This starts as early as the invitation to bid stage. All of the crucial project information is available to the owner and subcontractors when reviewing scope, negotiating costs and evaluating the schedule. The availability of accurate information minimizes the kind of confusion that can plant the seeds to later disputes.

For instance, the parties will be able to review the contract documents including drawings, project manuals, surveys, soil reports and planned sequence of work from a single location as opposed to separately maintained files. As the project proceeds, submittals, requests for information, meeting minutes and pending change orders or other modifications are stored in one place so the owner, architect and subcontractors are able to share information quickly. As access is permitted for the parties, each can upload the documents they must submit to keep the shared file current. No one will be able to claim they did not receive an update. This leads to faster problem solving and more timely approvals.

The project’s portal can also include customized tools to help everyone perform project obligations. For instance, the AIA A133 agreement between owner and construction manager includes common reporting obligations. The agreement requires the general contractor to schedule and conduct regular meetings to discuss progress and the adjustments to the project schedule. The contractor is also required to record the progress of the work and submit a monthly report to the owner showing percentages of completion, pending project issues and a forecast of the approaching activities. The software can be set up so this information is compiled seamlessly and verified easily by viewing tabs on a project dashboard. All of the narrative descriptions can be enhanced with progress photos and video.

The agreement also requires the general contractor to keep a daily log containing a record of the weather, portions of the work in progress, inspections, safety or other incidents and other information required by the owner. Then, if any situation arises that could lead to a project challenge, the facts and records are easy to review. In this way all parties can leverage the software to ensure they are complying with the agreement’s requirements for documentation and a timely response to any project issues.

The general contractor can also create settings to manage cost information accessible only to the owner and general contractor. With many projects being performed on a cost-plus-fee basis, the owner and general contractor can link project accounting software data to the portal so all field and financial information is available in one location. This helps everyone validate monthly progress payments with current percentages of completion, evidence of purchased materials and status of pending and approved change orders. As the payment process flows down to subcontractors, the crucial collection of lien waivers and other administrative requirements are readily apparent before payments are released. This helps everyone remain "breach-less" for a contractually compliant project performance.

The virtues of a project dashboard are many:

  • drawings can be transmitted even if they are large files;
  • everyone has the updated plans;
  • subcontracts and purchase order forms can be linked;
  • prime contract documents are available to all subcontractors;
  • project directories are available to all;
  • there is an increased level of paperless performance;
  • schedules are immediately updated;
  • there is a 100% digital punch list with pictures of open items; and
  • auto alerts to subcontractors communicate all of the upcoming tasks, activities, changes and closeout requirements.

The only “drawbacks” are the learning curve some less sophisticated firms experience when facing the requirement to interface with the program in general; and the potential for subcontractors to lose urgency if updates and notifications become too frequent.

The benefits of a comprehensive and current project file for everyone to access via desk top or mobile phone make any learning curve worth the effort. Experienced general contractors will recognize how this process can help fuel sales. The contractor uses demonstrations on an iPad to show owners how easily they can monitor the work when discussing new opportunities. Some owners are sold immediately by the 360 degree visibility over project progress; and others enjoy the deeper dive into the interface of financial progress and budget maintenance.

The best way to foster a successful project with minimal disputes is to facilitate the goal of all parties to remain in good standing under the terms of the contract. A shared project website helps all parties execute their responsibilities according to their agreements in light of all the challenges and changes projects face every day. Project management software can jump start the chance for success from commencement through ribbon cutting.

by Josh Levy
Joshua Levy is co-leader of Husch Blackwell's Construction & Design Group, and has represented clients for more than 25 years in construction disputes and claims. He is also an arbitrator with the American Arbitration Association.

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