The Blog Post explores: How the timing and timeliness of decision-making impacts the overall quality and cost of a project.
How the timing and timeliness of decision-making impacts the overall quality and cost of a project.
“Time is money.” We’ve all heard this phrase at some point in our lives. Whether spoken by a parent, teacher, boss, or partner, the essential lesson remains the same: if you waste your own time, or the time of others, that waste is costing someone money.
However, there is another way of looking at this phrase. It may refer not only to time in the sense of duration, but also to timeliness or timing – in particular, the moment when we make a decision. I would argue that this interpretation may be even more relevant to the successful outcomes of our personal and professional decisions.
In business, when we make our choices has a direct impact on the subsequent cost and quality of the services or products we purchase. There is a direct conflict between the all-too-human tendency to wait until the last minute and make crisis-driven decisions, and the clear benefits that accrue when decision-making is done with forethought in non-crisis conditions.
One truth about Building is that it’s very expensive. But a good chunk of the cost (I would estimate 10%) is directly due to poor time management when it comes to decision-making. For example, an Owner or A/E/C consultant who can’t make up their mind until the last minute, or various contractors who have mismanaged their overall project load and don’t show up as promised. The number of variations on this theme is endless–, trust me, over the years I have experienced most (if not all) of them.
For me, the key theme to today’s topic of “Time is Money” is NOT the fact that if people don’t perform, we lose money due to non-performing payroll costs (although that is true); rather, it is that Building is a logistical sport. It has myriads of interconnected parts that all demand timely decisions in order to function effectively, whether it’s bidding, scheduling, negotiating final contracts on materials, labor, transportation, and so on. Leadership’s ability to make timely decisions allows project managers to fully engage the marketplace and help ensure cost and quality efficiencies.
In most cases, the marketplace fully understands that a project needs to proceed very quickly, or risk losing serious money. Organizations prepared to move fast have an opportunity. This speed requires a much more intense and focused bid/contract process, typically causing disruption to other areas of each business involved in the project. Subsequently, the pricing for management, labor, and materials will invariably come with a premium.
Sometimes, of course, last minute decision-making is unavoidable. It could result from weather, an unforeseen change in business strategy, or the inability to obtain certain materials.
However, the majority of the time, last minute decisions result from poor time management on the part of the Owner, A/E/C leadership team, or other primary stakeholder.
Providing sufficient time for upfront pre-project coordination not only protects the bottom line, but also allows bids to be delivered confidently as each bidding company can still make a reasonable profit at a lower cost.
Often, decision makers are not aware of the impact their tardy decisions will have. Building teams see these self-made crisis moments as opportunities for heroism by “making it work” regardless of time pressure. For the successful construction team, it is a win-win. They build their relationship with their client and get to charge a premium to boot. The client also sees it as a win-win because they do not understand the significant impact their tardy decisions had on the bottom line.
Sometimes, arbitrary schedules are established. When the necessary executive decisions are not delivered in a timely manner, that process starts to eat into the necessary pre-construction time. This in turn creates additional costs and pressures on quality as described above.
Let me offer you a very simple example. Recently, I started taking bids from various painters to paint my house. My initial goal was to have the entire exterior of the house power washed, prepped, painted, and stained. Personally, I wanted to get the work completed before we left for Maine in mid-August (although this wasn’t a do or die deadline). So, I started getting bids in May. I quickly learned that all the painters were very busy. After a year of quarantine, the housing maintenance market had roared back with a vengeance and everyone was fixing up their yards and homes.
The initial bids to complete the project by mid-August came in between $16,500-$25,000. Then, I made a simple change. I told everyone that the project deadline was now October. The next set of bids came in closer to $10,000. This small project is a clear example of a larger principle that applies to projects of all scales.
The savings in paint bids was not due to scope change. Rather, it was due to the establishment of a reasonable timeframe. This allowed the market to fit my project into their schedule at more competitive costs and most likely quality, because the painter will have sufficient time to (hopefully) coordinate his staff, materials, and work schedules to optimize our project experience.
Good leadership understands that the timeliness of decision-making creates positive real-world impact. Timely and thoughtful decision-making is one of the simplest ways that the Owner and A/E/C team can immediately improve the quality-and reduce the cost- of building projects. For, as they say
“Time truly is Money!”