The All-in-One Owner’s Guide to Workflow Management Throughout the Construction Lifecycle

Evaluating the State of the Industry

The construction industry is known for being one of the most historically wasteful, inefficient, and budget-bursting industries within the global economy. However, with over $10 trillion spent on goods and services every year, efficiency improvements by those who pursue them will yield major profit returns. 

Opening Thoughts

According to a research study performed by KPMG, only 31% of construction projects were completed within 10% of the predefined budget in the last three years. That is a staggering figure sending chills down an owner’s spine. Productivity, efficiency, and risk management are all areas in construction with lots of meat left on the bone for improvement. And as such, we’re starting to see new technologies and products enter the market to help owners complete their projects in a more efficient and budget-conducive manner.

Whether it’s due to inaccurate forecasting, unforeseen labor costs, contractor errors, collaboration issues, or other external factors, the construction lifecycle has typically struggled to remain within budget and completed on-time. Many of these inefficiencies can be traced back to poor processes — or workflows — throughout the construction lifecycle. And as an organization with a close pulse on the owner market, we’re noticing a trend of owners making more serious investments, both in technology and people, to improve their project performance.

Project workflows that rely on collaboration across key stakeholders — particularly around design review, RFIs, change orders, and invoice & payments — have historically caused major pains for project managers (and their executives). For these workflows to function efficiently, there needs to be:

• An effective document management system in place
• Automatic cost tracking
• A transparent and trackable approval system
• Schedule integration
• One-click reporting functionality

For a project manager without a project management system in place, managing and reporting on these workflows are a very manual, fractured process.

As a result, we’ve seen project managers advocate for a project management system in order to properly regulate these construction processes throughout the construction lifecycle. In this piece, we will cover four crucial workflows (or processes) that are effectively managed by investing in a project management solution: 

• Design Review
• RFIs
• Change Orders
• Invoice & Payments

We’ll outline the pains of before, the benefits of implementation, expectations around efficiency, savings, and productivity, and how these construction workflows are critical to integrating with other elements of your project management functions.

Streamlining Construction Processes (Workflows) to Improve Efficiency 

Some construction projects involve thousands of different processes and workflows across hundreds of different stakeholders.

Workflow #1: Design Review

In the early stages of a construction project, the designated architect will put together a proposed design for the build. This will include a 2D floor plan (bird’s eye view), an elevation view (looking at the building), and BIM (3D). This collaboration in this stage is absolutely critical, as the design needs to accurately reflect the owners’ requirements. The design process involves multiple stakeholders, from the architect to the lead designer, consultants, project manager, and the owner. As such, collaboration can be fragmented and hard to keep track of.

The process typically entails major printing costs, as well as significant office space to store project documents. These documents will be printed, marked up, uploaded to a system like Sharepoint or Dropbox. These documents are then shared over email where numerous comments and revisions take place. This outdated process is inherently very fragmented and difficult to organize updates. If a consultant or contractor doesn’t see one of the comments in a document that wasn’t properly uploaded, major mistakes can occur in the construction phase.

A project management system flips this process on its head: providing a customized workflow connecting all the key stakeholders in collaboration on a single platform. The workflow includes automated document updates to execute every step needed in the design process. The customizable workflow captures all comments and revisions, automatically managing version control and stores project design documents in a centralized repository.

Finally, once the design goes out to bid, the project manager will need to solicit bids and maintain documentation for each. With a project management system like e-Builder Enterprise, an electronic portal is provided for contractors to access. The project manager has to perform very little work, as documents are automatically attached to each bid and cost projections are automatically reported on.

Workflow #2: RFIs

A request for information (RFI) is exactly as it sounds: a contractor or sub is working on the jobsite and needs clarification or additional information regarding the design or operation. It can occur during any project phase, but it typically originates from the general contractor needing clarification around project requirements. Historically an RFI comes in the form of a piece of paper or an email/or call to the owner.

However, especially when it comes to very large projects, tracking and management of RFIs is a nightmare for the project manager. The owner is typically overburdened with calls, emails, and forms — making it very difficult to route information accurately and in real-time. The project manager has to track RFI numbers in an excel log which doesn’t sync with the consultant’s log, causing confusion in OAC meetings (owner, architect, contractor meetings). As a result, delays in project timelines and cost overruns are common if an RFI isn’t captured and remedied in time.

A project management system with a customizable workflow will provide a standardized RFI form to ensure the issue goes directly to the stakeholder in real-time (removing the need for scattered and disorganized email). It should be noted that the same system can be leveraged for submittal management, another major pain point for project managers.

Logs are automatically created and real-time data populate reports and dashboards within the project management system. Project managers and their executives are given real-time, immediate visibility into potential schedule and cost impacts, allowing owners to make informed decisions before it’s too late.

Workflow #3: Change Order Management

A change order is a material change to the original scope of work in a construction project. Change orders are time-consuming, tedious, and often budget-busters. In a construction project, scope can change quickly and sometimes drastically. Change orders can result from many different sources: changing owner preferences, mistakes in design, or other areas. 

The physical workflow (or process) of a change order often causes significant delays. There are many compounding steps to a change order, including many different stakeholders. It’s not uncommon for 25+ different individuals to collaborate on a single change order. However, the process is inherently anti-collaborative. Without a project management system in place, email is the primary avenue of communication. Emails get buried in an inbox, management forgets to approve a change, and procurement doesn’t have the ability to authorize the purchase. Key project information and data is siloed.

As a result, contractors and their subs end up sitting on their hands. A lack of transparency and visibility leaves everyone wondering whose court the ball sits in. Unless absolutely every single individual contributing on a project is an excellent communicator (impossible), a change order workflow is a nightmare for all involved. 

This is where a project management system fills a major need. Every workflow contributor — from the project manager to the contractor to the owner — is able to login to e-Builder and quickly identify which stage the project workflow is in. It will show you whether the design has been approved, change has been submitted, funding has been allocated, or any other customized step the process currently resides in.

Not only do change orders require consistent communication just to function, it requires material updates to key project documents: a change to the original scope and contracts, updated documentation with justification and impact to cost/schedule, itemized estimate for work and materials, and more. Without a project management system in place, the project manager has to manually update, store, and categorize project documents.

With a project management system, a standardized workflow process is instituted to ensure the information & request is routed to the correct stakeholder in real-time. No more back and forth email communication. All stakeholders can login and check the status of the workflow in a single location. Additionally, all documentation, cost projections, approvals, and reports are automatically synced based on workflow updates (in this case, a change order).

For example, say the owner added an extra room and project cost increased by $100,000 and delayed project completion by two weeks — this would be automatically reflected in the overall project cost and schedule reports in real-time.

A project manager would normally have to manually track, store, and report on all of this — and a common complaint is that once the data is physically collected to report on, it’s four weeks out of date. The benefits of customizable & standardized project workflows is that it provides transparency, confidence in data, and the ability to report on a project status in real-time. Owners and executives receive immediate visibility into schedule and cost impacts before it’s too late. All at the click of a button. Yes, really.

Workflow #4: Invoice/Payments

When it comes to getting contractors paid, project managers undergo a very manual process that can often result in a contractor not seeing a check for months. The PM will receive a paper invoice from the contractor or supplier, which they then have to enter into an invoice log to signal to the accounting team that payment needs to be executed. Meanwhile, project accounting needs to manually update cost spreadsheets to report on project budget and performance.

To ensure that progress payments are made on time to contractors and their subs, an established workflow must be in place between the project manager, finance department, and the contractor.The project manager will need to review purchase orders for materials and track progress payments, the finance department will need to approve physical payment, and the contractor is on the backend to receive payment for work completed.

Without a project management system in place, this is an entirely manual process for the project manager. A combination of tracking down emails in specific folders, manually updating cost sheets in excel, physically notifying the finance department, and updating documents in a shared drive equals hundreds of hours in time wasted over the course of an entire project.

A customized invoice & payment workflow in a project management system will properly log, route, and update project cost reports in real-time. Once an invoice is submitted and reviewed, the following are automatically updated in real-time to enable proper decision making and mitigate the previous challenges of poor data capture:

• Logs
• Cost sheet
• Reports
• Associated documents are all captured in real-time and stored electronically

Closing Thoughts

At the end of the day, a project management system with configurable workflow management increases project efficiency, productivity and transparency among stakeholders, cost savings, and the chances of a project being completed on-time and on-budget. Invaluable to both the project manager and executive management in different ways, a project management solution upgrades traditionally manual workflows into a seamless process that syncs with document management requirements and reporting capabilities across project lifecycles. For a project manager, customizable, repeatable workflows will save them hundreds of hours in tedious, manual work.

For the executive (and more importantly to the board), a project management system provides the ability to report on project performance in real-time with complete accuracy. In the past, reporting on project performance was a very time-consuming process of data collection and verification across multiple sources. By the time a report is manually generated by the project manager, the data is old and outdated. In a project management system like e-Builder Enterprise, it’s one click to provide a real-time report of project performance.

Data integrity is also a real issue in traditional workflows. With a project management system in place, both a project manager and an executive can view the data in a single source. Old workflows limit insight into accurate cost information, provide inaccurate forecasts to completion, and hampers overall project performance. Effective workflow management with a project management solution increases productivity, employee efficiency, and the chances of a project being completed on-time and on-budget.