Construction Project Management 101

Smartsheet Contributor Diana Ramos

Nov 14, 2015

If you’re new to construction project management, this article will walk you through the must-know basics, commonly used business models for construction projects, and the role of a project manager in construction projects so you can master the skills and expertise needed to manage dynamic, time-sensitive construction projects of all sizes.

You’ll also learn about the best universities to study construction project management and hear from industry experts to better understand best practice tips and tricks when it comes to construction project management.

What Is Construction Project Management (CPM)?

According to the Project Management Institute (PMI), project management is “the art of directing and coordinating human and material resources throughout the life of a project by using modern management techniques to achieve predetermined objectives of scope, cost, time, quality, and participating objectives.” You can extend PMI’s definition to construction project management, wherein a construction project manager uses the same model to achieve the same goal, only in a construction context.

At its most fundamental level, construction project management handles the planning, coordination, and execution of a construction project, whether it’s agricultural, residential, commercial, institutional, industrial, heavy civil, or environmental.

Construction project management typically includes complicated tasks that can shift wildly, depending on the work at hand, and it requires strong skills in communication, deep knowledge of the building process, and the ability to problem-solve. Construction project management is a complex field, requiring knowledge in many different areas like finance, mediation, law, business, and more.

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History of Construction Management, from the Pyramids to Today

As long as there have been complex building projects, there have been project managers. For centuries, however, the person overseeing the construction of a complex building was often the architect, which is thought to be the case in ancient structures like the Great Pyramids of Egypt and the aqueducts of Rome.

Into the Renaissance, individual architects began to be known for their designs, like Sir Christopher Wren of England. Wren designed and built buildings in the late 17th and early 18th centuries, including the masterpiece St. Paul’s Cathedral, that help give London its rich countenance. Wren had a breadth of knowledge that would foreshadow the types of skills needed on a complicated construction project, with expertise in advanced mathematics and physics, as well as in design. He was on his building sites every day overseeing every phase of the works.

The rules of project management began to take shape across corporate America around the time of World War II, and by the 1950s, they were guiding civil construction projects. This meant that the phases and tenets of managing a construction engineering project were now being applied to a variety of corporate projects.

More and more details of managing a construction project can be done digitally (see software section below), and that trend is expected to grow. Mobile-friendly technology and software are set to play a major role in the field, as a younger workforce is more comfortable with the technology, and it will allow the work to be managed and tracked from anywhere.

Roles of Construction Manager and Contractor

Construction managers and general contractors play key roles in executing a project successfully. Construction managers coordinate and oversee building work and make sure participants adhere to the budget and schedule.

To learn more about this role, see "Everything You Need to Know About Commercial Construction Management and Managers."

Contractors are in charge of the hands-on construction work and interact extensively with the construction manager.

First up in any construction project is the design phase, and when that’s finished, the construction project manager opens the bidding process to interested contractors. To qualify for consideration, contractors must be able to show they can handle public safety; decision-making, engineering, drafting, human resources, and time, cost, and quality management. The contractors who meet these guidelines are then chosen through low-bid selection, best-value selection, or qualifications-based selection — all common measures.

Construction Project Management Basics: How to Win the Project

When a project owner is ready to get started, the owner will share project information to a large group of contractors, general contractors, or subcontractors to solicit bids. The process starts with a cost estimate from blueprints and material take-offs, telling the owner how much money he or she should expect to pay for the contractor to complete the project.

A contractor can expect two kinds of bids:

  • Open Bid: Open bids apply to public projects and are usually advertised. With an open bid, any contractor can put in an offer.
  • Closed Bid: The process for a private project starts with a closed bid, wherein the owner invites a select group of contractors to send in their bids.

Whether the owner chooses an open or a closed bid process for the project, the bids will then come in, and the selection of a contractor can commence based on a number of criteria:

  • Low-Bid Selection: The bottom line — aka the price — is the main focus for the project owner. The winning contractor is the one who submits the lowest price for the project.
  • Qualifications-Based Selection: In this process, the project owner asks contractors to submit with their bid a request for qualifications (RFQ), which summarizes the contractor’s experience, plans for management, organizational flow, and success in staying on budget and on schedule. The project owner then chooses the contractor with the best qualifications.
  • Best-Value Selection: In this approach, the project owner considers both the bid price and the contractor’s qualifications to find the best combination of cost and skill set.  

The next and final step after an owner chooses a contractor is to negotiate a payment agreement. Both parties typically select from four payment models:

  • Lump Sum: A lump-sum contract is the most prevalent choice. The project owner and the contractor come together on the overall cost for the work, and the owner must pay that amount, regardless of the project’s success or if the final bill surpasses the initial quoted price.
  • Cost-Plus-Fee: As the name suggests, cost-plus-fee includes the total cost of the project as well as a fixed fee percentage of the overall cost to the contractor, all of which the owner must pay. This is the most contractor-friendly arrangement, since it covers all additional costs.
  • Guaranteed Maximum Price: With a guaranteed maximum price contract, the owner and contractor agree on a set price that the total cost and fee cannot exceed.
  • Unit Price: If the two parties can’t agree on the cost ahead of time, they opt for a unit-price model, in which the owner pays out a specific unit price throughout each phase of the project.

The Construction Management At-Risk Delivery Method

“CM at-risk” is a delivery method growing in popularity in the United Kingdom and around the world, and it refers to the business relationship between a construction contractor, owner, and architect (or designer). With this plan, the construction manager commits to completing the project for a guaranteed maximum price (GMP) and plays two roles: He or she is a consultant to the owner through development and design (pre-construction services), then shifts to general contractor responsibilities during construction. Thus, the fundamental character of the professional relationship is changed.

In addition to acting in the owner's interest, the construction manager must control construction costs to stay within the GMP. Because the arrangement guarantees a maximum payment, low bids are typically not considered. Instead, the construction manager will work toward fulfilling the financial goal through other avenues.

The advantage of a CM at-risk arrangement is budget management. Before a project's design is completed (six to 18 months of coordination between designer and owner), the construction manager is involved with estimating the cost of constructing a project based on the goals of the designer and owner (design concept) and the project's scope, all while achieving optimal quality. The construction manager will have to be ready for potential changes to balance the costs, schedule, quality, and scope of the project while still meeting the financial goals.

For example, instead of a redesign, the construction manager may suggest modifications instead. Or if the owner decides to expand the project, the team will have to make adjustments before pricing. To keep a handle on the budget before design is complete and construction crews are called up, the construction manager conducts site visits and purchases major items ahead of demand.

Advantages: In this arrangement, the construction manager assumes the risk, so he or she has an incentive to act in the owner's interest and to efficiently manage costs, considering GMP overruns would be the responsibility of the manager’s company.

Drawbacks: A cost overrun could cost the construction manager a great deal of money. The CM is allowed some mistake-related contingency, so there is a possibility that they will compensate by reducing the scope of the work to fit the GMP. Also, since the GMP is decided before design begins, it is difficult for owners to know whether they received the best possible bid.

Bottom Line: An at-risk delivery method is best for large projects — both complete construction and renovation — that are not easy to define, have a possibility of changing in scope, or must meet strict schedule deadlines. It can also be an efficient method in projects containing technical complexity, multitrade coordination, or multiple phases.

Accelerated Construction Techniques: Starting with its Accelerated Bridge Program in the late 2000s, the Massachusetts Department of Transportation began employing accelerated construction techniques, in which it signs contracts with incentives for early completion and penalties for late completion, and uses intense construction during longer periods of complete closure to shorten the overall project duration and reduce cost. The federal and California Departments of Transportation also employed this technique after the Northridge earthquake in 1994 to speed up repair of freeways in the Los Angeles area.

Business Models for Construction Projects

The bidding process is usually consistent no matter the type of construction project, but you can expect two business models in the construction industry:

  • Design-Bid-Build Contracts: Both popular and prevalent, design-bid-build contracts allow the owner to choose a contractor after an architect or engineer completes the design phase.
  • Design-Build Contracts: The opposite of design-bid-build, in a design-build contract, the design and construction phases are handled by the same party (referred to as the design-builder or the design-build contractor). This approach speeds up the project’s completion since the design and construction phases can happen simultaneously.

As noted in the two above models, the bidding process begins with the design phase. The design stage itself can be broken down into different approaches.

  • Conceptual/Programming and Feasibility: This model uses the final vision of the building as the starting point to determine needs, goals, and objectives. Considerations include the building size, the number of rooms, how the space will be used, and even who will be using the space. This information is generally captured in a spreadsheet listing each room, the critical information about those spaces, and the approximate square footage of each area.
  • Schematic Design: Schematic designs are drawings or sketches used to identify spaces, shapes, and patterns. Not every part of a construction project can be sketched, of course, but those that can be are in this type of design. The drawings note materials, colors, and textures. These sketches can also capture floorplans, where structures like elevators will be placed, and so on.

Project Management Principles and Process

After the bidding process is finished, the construction phase can then start. Although the stages of a construction project are different than that of traditional project management, they follow a similar pattern.

If they don’t already know them, all construction project managers should familiarize themselves with the five phases of project management, as developed by the Project Management Institute.

1. Initiation

Before the project starts, a project manager must develop and evaluate the business case to determine if the project is feasible and worth undertaking. Stakeholders may be asked to do their due diligence and to conduct feasibility testing, if needed. When all parties agree to proceed with the project, the project manager writes a project charter or project initiation document (PID), which includes both the business needs and the business case.

2. Planning

Next, the project team develops a road map for all involved. This includes the project management plan (PMP), a formal, approved document created by the project manager to guide execution and control, as well as set baselines for scope, cost, and schedule. You can also expect to see these documents in the planning phase:

  • Scope statement and scope documentation: This defines the project’s business need, benefits, objectives, deliverables, and key milestones.
  • Work breakdown structure (WBS): This document breaks down the scope of the project into visual, manageable chunks.

  • Communication plan: This outlines all aspects of communication, from goals and objectives to roles to tools and methods. The communication plan creates a common framework that everyone can work from to avoid misunderstandings or conflict.

  • Risk management plan: This helps project managers identify  risks beforehand, including time and cost estimates that may not be met, potential budget cuts, shifting requirements, and a shortage of committed resources.

3. Execution

Now the work begins. Typically, all parties hold a kickoff meeting, then the project team begins the crucial work of assigning resources, implementing project management plans, setting up tracking systems, completing tasks, updating the project schedule, and if necessary, modifying the project plan.

4. Performance and Monitoring

The monitoring phase often happens concurrently with the execution phase. This phase is necessary to measure progress and performance and to ensure that items are in line with the overall project management plan.

5. Closure

This final phase marks the project’s completion. To mark the conclusion, project managers may hold a post-mortem meeting to discuss what parts of the project did and didn’t meet objectives. The project team then creates a punch list of any lingering tasks, performs a final budget, and issues a project report.

Learn more about the phases of project management.

New to Construction? Advice from the Experts

We asked six construction project management experts about their No. 1 piece of advice for people entering the field.

Here's what they had to say:


Barbara Jackson

"Spend time on the job site observing the work being done and asking lots of questions. Get out in the field, get your boots muddy, and show respect to the trades who actually do the work of getting projects built. It's important that entry-level CMs understand the many field elements, such as weather, site conditions, limited lay down space, traffic congestion, etc., that can impact cost, schedule, quality, safety, and the other project variables that CMs are responsible for managing."

— Barbara Jackson, author of Construction Management Jumpstart and director of the Franklin L. Burns School of Real Estate & Construction Management.


Dan Julien

“Keep communication flowing. Bad news is just as important as good news. Making sure all stakeholders in the project are aware of what is happening on the job will minimize the phone calls, emails, and conference calls in the midst of trying to fix or recover from an issue onsite.”

— Dan Julien, principal of Julien Management, a construction and project management consultant to some of the largest brands and high-profile individuals.


Alison Dykstra

"Commit yourself to ongoing education. The construction industry is in the midst of change — cost, project delivery systems, technology, demographics, and perhaps most important, sustainability (’green’) expectations, are all impacting how projects are designed, built, managed, and financed. Successful CMs are nimble and informed and understand the implications of these many changes. The old way of doing things is disappearing; keeping up to date on everything from standards and codes, to construction practices, to collaborative project delivery and more will be required."

— Alison Dykstra, AIA, founder of Kirshner Books and author of Construction Project Management: A Complete Introduction and Green Construction: An Introduction to a Changing Industry.


Paul Netscher

"In construction management, the more we plan the luckier we get and the more successful our project becomes. Planning begins before starting the project, including selecting the best construction methodologies, preparing the construction schedule/program, and organizing resources. It also encompasses daily and weekly planning through the life of the project to ensure all tasks are completed.

“Construction is all about teamwork, and good communication is essential for every project manager. You have to communicate with your team, subcontractors, suppliers, your client, designers, local authorities and sometimes neighbors and members of the public."

— Paul Netscher, author of two construction project management books, including Successful Construction Project Management.


Vicente Barrera

"Never stop studying or analyzing everything you see in a project. Never take anything for granted. The construction management profession demands complete attention, great commitment and excellent learning and analytics skills. Live the project in its day to day and never forget to prepare for the unexpected."

Vicente Barrera, who has two decades of professional experience in industrial construction and infrastructure. He is currently a project manager for SENER, a private engineering and technology group.

“My biggest piece of advice: Never stop learning. That was actually one of the major reasons why we created Construction Junkie. The construction industry may still do some of the same things we've done for decades, but there's always room for improvement and things should always be improving. Just look at the advances being made in concrete right now. Concrete has been used for centuries, but now scientists are figuring out ways for it to heal its own cracks and others are engineering ways to make permeable concrete strong enough for heavy concrete. If we stop learning, progress stops with it.”  

— Shane Hedmond, editor in chief of

Top Construction Management Books for Beginners

Here are some top construction management books for beginners, either students or those just entering the field:


Construction Management Jumpstart Book

Construction Management JumpStart by Barbara J. Jackson

Written by an expert with over 20 years of experience as a licensed contractor, this bestselling guide provides a deep introduction into construction management basics, shares the latest techniques and tools of the trade, and includes today’s hot issues like sustainability and build information modeling (BIM). Readers will find out what it takes to be a construction manager with an aptitude quiz, learn the ins and outs of contract documentation, and build and maintain a project schedule. Learn more about Jackson's book.


Construction Project Management Book

Construction Project Management: A Complete Introduction by Alison Dykstra

Alison Dykstra, an architect and construction management teacher, offers an introduction to managing contracted construction projects in 25 chapters. The book walks through the early development stage through bidding, selecting a contractor, the construction itself, and closing out. She also covers frequently asked questions, like who the players are in construction and what each one does, and the link between the type of contract and how the contractor gets paid. Learn more about Dykstra's book.


Successful Construction Project Management Book

Successful Construction Project Management: The Practical Guide by Paul Netscher

Geared toward construction professionals and students, this book by a construction professional provides a step-by-step guide to successfully managing a project, including a list of things not to do to avoid costly mistakes. Readers will learn about planning the project, scheduling, people, materials, quality, safety, subcontractors, contracts, finance, and more. Learn more about Netscher's book.


The Management of Construction Book

The Management of Construction: A Project Lifecycle Approach by F. Lawrence Bennett

This 2003 book introduces all aspects of construction management to students and professionals. It covers each stage of the construction project from conception to completion, design-build, and build-own-operate-transfer, and it discusses environmental issues important in 21st-century practice.


Australian Construction Handbook

Rawlinsons Australian Construction Handbook

This massive and exhaustive reference book for the Australian construction industry is frequently updated. Now in its 35th edition, the handbook includes increased coverage of green design, sustainability, environmental management, and more.

Informative Articles on Construction Project Management

Even more valuable resources on construction project management can be found on the internet in the form of articles and reports. Here are two such documents that flesh out the role of the construction project manager in the building process.

The Risk in CM “At-Risk,” by Warner Strang

This PDF explains the pros and cons of the CM at-risk model from the owner’s and construction manager’s point of view, along with pointers on how to get the most out of the arrangement.

"What Is Construction Project Management?” by Gerardo Viera

This article breaks down the overlap between project management and construction management, outlining how knowledge of one can feed into the other.

The Stages of Construction Project Management

The construction management life cycle begins at the same time as the bidding process, but once the contract has been finalized, the meat of the project can start.


Construction Project Lifecycle

Here are the stages in a construction project:

1. Design

This is the first stage of a construction project, and once it is completed, it signals the beginning of the bidding process. In design-bid-build contracts, the owner chooses a contractor based on completed designs.

In this stage, an architect or engineer first assesses the feasibility of the design based on regulations and codes of the building, as well as the number of rooms, the size of the building, and the amount of space. Then he or she creates schematic designs or sketches, researching the type of equipment and materials needed and their cost.

2. Pre-Construction

The bidding process is over and the owner has chosen a contractor. The contractor is then paired with the project team, including a contract administrator, project manager, field engineer, and superintendent. Then the team gets the site ready for construction. They conduct a site examination, test soil, and identify any possible unexpected situations, like environmental challenges.

3. Procurement

The project team purchases the required equipment, materials, and labor. In other words, the procurement stage is when the team buys everything it needs to complete the project. The complexity of this stage depends on the size of the project and the company. Large national construction companies usually have procurement departments that hire labor and purchase materials for hundreds of projects at once. On the other hand, for smaller projects, the superintendent may buy limited quantities of materials from local building supplies or hire a local laborer.

4. Construction

To kick off the construction phase, the superintendent will arrange a meeting with the subcontractors and material vendors to set the ground rules for working together. Then the team must get ready to start construction, completing activities like setting up temporary storage facilities, securing the site, developing a materials and handling plan, establishing safety programs, and more. After that, the team begins construction.

5. Commissioning

Once construction is completed, the commissioning stage begins. There are two parts to the commissioning process. First, the project team must test the systems and equipment to make sure everything is working correctly before turning over the building to the owner. Then the team must train the owner’s personnel in the operation and maintenance of the systems in the new building.

6. Owner Occupancy

When the owner moves into the new building, the warranty period starts. This ensures that all the materials, equipment, and building quality meet the expectations outlined in the contract. There are two types of warranties: express warranties (written and included in the contract) and implied warranties (established or required by law).

7. Project Closeout

This final phase ties up any loose ends. The team formally completes any remaining contractual obligations to finish the project. They may create a project punch list of any tasks that didn’t get accomplished and may conduct a post-project review, document lessons learned, archive project documents, or prepare a project completion report.

Cost, Budget, and Finance in Construction Management

Project managers must always think about money. From estimating budgets before the project even starts to hiring and paying contractors, financial management is one of the most important parts of a successful project.

Here’s what you need to know about money matters in construction:

1. Construction Pricing and Contracting

There are a number of options when paying contractors and outlining price in contracts. In the competitive bidding process, contractors submit their bid to work on the project. These bids are either submitted on a lump-sum or unit-price basis, whichever the owner specifies. A lump-sum bid refers to the total price of work by the contractor. Unit-price bidding is used in projects where the amount of labor and materials are uncertain.

Instead of inviting competitive bidding, some private owners choose to award contracts to one or more selected contractors with negotiated contracts, which provides more flexibility in pricing. Negotiated contracts usually require reimbursement of direct project costs plus the contractor’s fee determined by one of these methods: cost plus fixed percentage, cost plus fixed fee, cost plus variable fee, target estimate, or guaranteed maximum price or cost.

2. Cost Estimation and Budgeting

A cost estimation is prepared in order to submit a bid for a construction project and is used to establish a budget for the project once it is won. The process includes determining the cost estimates from building, unit prices and lump-sum estimates, job sites and general overhead, bidding procedures, and labor costs. Cost estimates are sometimes prepared by a professional, such as a building estimator or a chief estimator. Even though the project manager may not be the sole person responsible for cost estimation, it is still necessary that he or she become familiar with the process to understand the scope of the project.

3. Cost-Control Monitoring

As the project begins, project managers need to quickly create a process to monitor project costs. The sooner the cost-control monitoring phase begins, the faster that project managers will be able to identify trouble spots. For example, if an item is significantly more expensive than the estimate, the project manager should identify the reason for the difference and see if that cost increase affects anything else in the budget.

4. Capital Improvement Plan (CIP)

A Capital Improvement Plan (or Program) is a four- to 10-year plan that identifies capital projects and equipment purchases, provides schedule, and identifies options for financing the plan. The plan links a government entity, a strategic plan, and the entity’s annual budget. A CIP includes a list of all projects or equipment to be purchased, the projects ranked in order of preference, the plan for financing the projects, schedules for the construction phase of the project, justification of the project, and explanation of the expenses.

5. Project Accounting

The project manager and/or the agency’s accounting department will have to develop the project budget for the fiscal year, record and report expenditures, review and pay contractor invoices, and manage cash flow. From materials to labor, there are many costs in construction projects. Costs are either direct (labor, material, subcontracting, and land) or indirect (indirect labor, supervision, tools, equipment, supplies, insurance, and support costs).

The project team and the accounting department may need to work closely together to manage contractor invoices. The project team reviews invoices to make sure the work has been properly completed, then the accounting department ensures that the invoices are contractually eligible and the prices are consistent with the contract.

Organizing and Scheduling a Construction Project

With RFPs, contracts, invoices, blueprints, and more, it can be hard to keep track of all the necessary documents in a construction project. Because construction projects are so large and involve complex information, organization is key to staying on schedule.

Organization Strategies

There are several streams of information that need organization and management in any construction project. These are the most business-critical:

Records Management: Record management controls the distribution, storage, and retrieval of project records, both hard copies and electronic, in a safe, secure manner. Project managers must make sure that all incoming and outgoing documents are transmitted through the records management specialist, who uses software to track the records (this method will also create a central library of all project documents and information).

Contract Management: It is important to clearly define the roles and responsibilities for the project team members who are managing the project and the project staff responsible for managing contracts and documents. The contract management plan is designed to set expectations and procedures around this by addressing who has the authority to direct and approve the contractors to work, how the contractor’s work is monitored and reported, how they are paid and approved, how contracts are modified, which financial audits are necessary, etc.

Contract Procurement Planning: Project managers also have to ensure that procurement activities fit with the project plan. Some of the tasks they have to manage include:

  • Setting expected contract price
  • Creating the scope of work (SOW) for each contract
  • Standardizing procurement documents and any other necessary documents
  • Adding completion dates to contracts that align with the project schedule

Commissioning Plan and List: The commissioning plan and list should be started early in the design phase and continually updated as the project progresses. The commissioning plan is designed to provide direction for the commissioning process during construction; to resolve issues related to scheduling, roles, and responsibilities; and to aid in the reporting, approvals, and coordination. It is a systematic process to ensure that buildings perform according to the design and to the owner’s operational requirements.

Project Control Process: The project control process tracks and manages the scope, cost, and schedule of a construction project. The goals of this process are to establish a baseline, track performance against the baseline, forecast performance at completion and compare to the baseline, and identify changes and monitor the effects to the baseline.

Project Requirement Definition: Also known as the statement of work, this document details the project deliverables. In the project requirement definition (PRD), the project manager explains the scope of work and what the project will accomplish. It helps stakeholders, team members, and external parties all understand the goal of the project and acts as a record of initial expectations.

As-Built Drawings: Also known as record drawings, these are edited drawings submitted by a contractor at the end of a project. They reflect all the changes made in the working drawings during the construction process and show the dimensions, geometry, and location of all elements included in the contract. As-built drawings provide a quick visual into the existing design and capture deviations from the original documents.

Daily Documentation: Keeping diaries, logs, and daily reports of project activities acts as a reference guide after the work is completed and can mitigate any damages. This kind of documentation can show how questions were answered, how problems were solved, and tracks any unusual conditions on a certain day. By keeping these daily logs, you are leaving a paper trail throughout the whole project in case anything goes awry later on.

And finally, the working drawings are created. These are the project’s final specifications and illustrations that builders use for construction and that contractors add to their bid.

Scheduling Strategies

Organizing your documents helps you categorize and prioritize important project information, and once you have everything stored in a central location, you can build out your project schedule.

A well-defined schedule provides a structured approach to planning, identifies problems before they arise, forecasts cash flows, and assesses resource requirements.

Here are the fundamental and advanced scheduling techniques:

  • Gantt Charts: A Gantt chart is the easiest way to create a construction schedule. It lets you visualize your project timeline by transforming task names, dates, durations, and end dates into cascading horizontal bar charts. Learn more about creating and using Gantt charts in Smartsheet.
  • Critical Path Scheduling: The most widely used scheduling technique is the critical path method. This method calculates the minimum project completion time and the start and end dates for all project tasks. It identifies the critical tasks that, if delayed, will delay your entire project. The critical path method helps you reduce timelines, manage resources, and compare planned with actual. To learn more, read our Ultimate Guide to the Critical Path Method.
  • Line of Balance: This scheduling technique is best suited for repetitive work and is often employed in road construction. It is a management control process for collecting, measuring, and presenting facts relating to time, all measured against a specific plan. With a Line of Balance schedule, you must allocate resources for each step, so you can make sure the next step is not delayed.
  • Q Scheduling: This form of construction scheduling addresses the sequence of activities, relationships between tasks, and the total cost of finishing the project. It includes the overall construction site and prevents two competing activities from happening at the same time at the same location. While this technique is the closest to reality, it requires special software and can take more effort from the project manager to evaluate cost analyses for the different schedule alternatives generated.

Problems, Issues, and Legal Matters in a Construction Project

Construction projects are always changing, and the constant level of uncertainty can often bring conflict to project teams. Construction project managers are often tasked with resolving disputes, identifying and mitigating risks, and understanding legal ramifications.

Here’s what construction project managers should know:

How to Resolve Disputes

Conflicts will inevitably arise in any project. It’s the project manager’s job to resolve the disputes, so the team can stay productive and work well together. Possible conflicts in a project could include poor communication, lack of clarity, conflicts of interest, limited resources, or power struggles. While every conflict is different, there are several resolution strategies that you may employ:

  • Mediation: A third-party mediator will be hired to resolve the disputes between the two parties. This strategy is the cheapest and least time-consuming.
  • Mini-Trial: A mini-trial is held in an informal setting with an advisor or an attorney who must be paid. The agreement is nonbinding and can be broken. A mini-trial takes more time and more money than mediation.
  • Arbitration: Arbitration is the most expensive and time-consuming way to resolve a conflict. Each party is represented by an attorney while witnesses and evidence are presented. Then, the arbitrator makes a ruling and his final decision is a binding agreement.

How to Create a Risk Management Plan

By focusing on prevention, project managers can spend less time dealing with spontaneous problems and more time on reducing their impact. A risk management plan is used to manage all project risks, defines the roles of project staff in risk management, and identifies potential risks and categorizes them in terms of probability and impact.

Understand Legal Principles

When project managers have to negotiate contracts, deal with jurisdictions’ licensing requirements, purchase insurance, and manage job site safety, an understanding of legal principles can save time and money. There are several areas of liability in construction management. There could be a claim for failure to detect defective work if a bid exceeds estimates, if there is extended overhead, or if the project is delayed. Most professional liability policies don’t cover any aspect of faulty workmanship (like fabrication or installation) or economic risks, so project managers have to make sure they have the appropriate coverage and are doing everything they can to avoid liabilities and claims.

How to Prepare a Quality Control Plan

A quality control plan ensures that the building has reached a specific standard. Quality control is the last step a project goes through before it’s delivered to the owner, and it consists of a series of systems and procedures to make sure it meets the highest standards. Project managers will have to evaluate how to test quality, create a step-by-step process for auditing the project, and revise and review the plan to find new problem areas. They will also have to be knowledgeable in safety management and codes, building codes, and compliance codes, then include these aspects in the plan.

How to Anticipate and Address Environmental and Neighborhood Impacts of Construction

Construction project managers and their teams can plan for licensing, permits, and all measures of local regulations, but sometimes nature plays a part in the building process. These are a few ways flora and fauna, the land and the sea can affect your project plan — and how to deal with them.

Dust and Mud: Excessively dusty conditions can result from construction vehicles simply driving on a site, much less moving earth from spot to spot. Because the increased particulate matter can disrupt nearby businesses and homes, construction project owners would do well to control the dust count. One easy way to do so is to drive a water truck through the site and spray down the area. However, this creates mud, which can spread out to surrounding areas via construction vehicles. To counter this development, the project owners should get a street sweeper to clean the roads.

Storm Water Pollution: Construction projects can introduce foreign elements to the land. Should a storm hit, the runoff can carry those potential pollutants to nearby streams, rivers, lakes, aquifers, wetlands, or coastal waters.

Endangered Species: If an endangered species is found on the construction site, the site must cease operations for as long as it takes for authorities to assess the situation. Once a decision comes down, the contractor implements the proper course of action to not disturb the species.

Vegetation: Animals aren’t the only protected entities; trees and vegetation on a construction site could be subject to environmental safeguards too. The construction project manager could be faced with designating a safe zone for the growth, perhaps with a fence or security tape.

Wetlands: Wetlands are some of the most heavily protected areas in the United States. Contractors and builders must be especially vigilant in preventing contaminants or unregulated material from entering these restricted zones.

Historical or Cultural Artifacts: This classification can cover arrowheads, pottery shards, early tools, bones, and more. If any artifacts are found on the construction site, all work must halt until the the pieces can be studied and removed.

Construction Project Management Software

There are many versatile web, cloud, and mobile apps to streamline communication, simplify document management, and improve efficiency in construction management.

Here are some top construction management tools:




Construction Project Plan Template

Smartsheet is a spreadsheet-inspired work management tool with robust collaboration and communication features. With pre-built construction templates, it’s easy to create a timeline, track progress, manage documents, and organize the details. Gantt charts are automatically created and auto-adjust every time a change is made, so you can share the most up-to-date timeline with team members or stakeholders. You can upload files from your computer, Google Drive, Box, Dropbox, Evernote, or add a web URL, creating a central repository for all project documentation and contracts. Team members can have discussions directly in the sheet and set reminders and alerts, so everyone is on the same page. And lastly, Smartsheet integrates with other apps like DocuSign (to streamline the contract process by collecting e-signatures), Harvest (to automatically create invoices), and Google Apps (to sync your calendar and add or edit information directly from Gmail). Get a free 30-day trial of Smartsheet.






Buildertrend Example

BuilderTREND is a cloud-based construction project management tool for home builders and remodelers. It helps builders communicate with subcontractors about tasks and allows clients to see real-time status about their home and the costs. BuilderTrend lets you create proposals, simplify the bidding process, send documents, create schedules, and manage customer relationships.






CoConstruct Example

Co-construct is a web-based solution for custom builders and remodelers. It helps businesses coordinate their selections, schedules, and photos while improving relationships with interactive communication. Users can track change orders, create a project budget, update schedules, share files, and more.






Procore Example

Procore helps firms increase efficiency and accountability with streamlined communication and documentation. The cloud-based tool provides ways to collaborate on projects and view documents, with real-time editing capabilities. Other features include project dashboards, scheduling, reporting, document management, email training, bidding and more.






BuildTools Example

BuildTools is designed for residential construction firms and offers project management, scheduling, service management, document storage, budgeting, and customer management capabilities. You can manage all the communication for your crew and subcontractors, easily sharing emails, site photos, project schedules, budgets, and timesheets.






Aconex Example

Aconex offers one solution to manage information and processes across engineering and construction project to improve efficiency and reduce risk. Features include document management, workflow automation, bid management, issue management, and more. As a web-based solution, Aconex allows users to create and review documents from any location.






PlanGrid Example

PlanGrid is a construction productivity platform that enables collaboration via mobile device in the field or wherever your project team is working. It allows the latest versions of blueprints, RFPs, schedules, and more to be synced to every employee in real time.

Education Opportunities for Construction Project Management

To learn more about education programs in commercial construction management and career opportunities in the CM field, see "Everything You Need to Know About Commercial Construction Management and Managers."

Managing Sustainable Building Projects

Green construction, focused on making structures more energy efficient and eco-friendly, is a huge area of growth in the construction industry. “Green building” refers to the effort to ensure that both the actual structure and building process are environmentally responsible. 

Project managers overseeing a sustainable building project must understand how the project affects the environment, ensure that waste is properly disposed, find greener materials, and use efficient building methods. He or she must also understand environmental issues and environmental compliance in the area they are building. Many green project managers are required to have a working knowledge of documentation requirements for Leadership in Energy and Environmental Design (LEED).

Terminology and Acronym List

A&E: architectural and engineering
BOT: build operate transfer
BOO: build own operate
CA: contract administrator
CIP: capital improvement plan
CM: construction manager
CPI: cost performance index
CPM: critical path method
CREM: corporate real estate management
D/B: design/build
D/B/B: design/bid/build
DBOT: design build operate transfer
EA: environmental assessment
EIS: environmental impact statement
EPC: engineering, procurement, and construction
FBOT: finance build operate transfer
FEIS: final environmental impact statement
FONSI: finding of no significant impact
GC: general contract
GEC: general engineering consultant
GM: general manager
GMP: guaranteed maximum price
JV: joint venture
LEED: Leadership in Energy and Environmental Design
MC: management contracting (mostly UK)
MPC: multiple prime contracts
MPO: metropolitan planning organization
OFE: owner furnished equipment
OSHA: Occupational Safety and Health Administration
O&M: operations and maintenance
OR: owner representative
PC: project control
PD: project director
PFI: private finance initiative
PL: project leader
PM: project manager
PMC: project management consultant
PMO: project management oversight
PMP: project management plan
PRD: project requirements definition
ProgM: program management
RE: resident engineer
REM: real estate management
RFC: request for change
RFI: request for information
RFP: request for proposal
SOW: scope of work
SPI: schedule performance index
VE: value engineering
WBS: work breakdown structure 

Improve Construction Project Management with Smartsheet

With many stakeholders, hundreds of details, and dozens of documents, construction projects can be complex and difficult to manage. However, the key to being successful is to never stop learning, to stay organized, and to communicate frequently and clearly.

Smartsheet is a work execution platform that enables enterprises and teams to get from idea to impact - fast. Many of the world’s leading construction companies rely on Smartsheet to stay productive, communicate among far-flung teams, and document every step of the project.

Use Smartsheet to improve work and project documentation, increase collaboration with proactive communication among project teams, vendors, and clients, and save time with accurate resource management. Reduce testing and inspection errors, accelerate close-out time, and improve job satisfaction by maintaining transparency between client and site crew.



Construction Project Plan Template

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