According to a recent article in ENR (Nov. 28/Dec. 5, 2016 issue) by Thomas Schleifer, Ph.D, failed projects are more likely to occur when contractors seek new work outside their traditional niche. The more obvious scenario is work on a project in which the contractor has no experience at all, but failure is also more likely even when new projects are only slightly different than their prior experience. Schleifer's research found projects within a firm's experience tend to be successful, but wanted to solve the problem of how contractors can get that critical experience necessary to comfortably pursue new work. This involves either taking risks they can afford, or getting an accurate assessment of risk and treading very cautiously.
Based on extensive studies, Schleifer and his team have developed a free tool to help contractors, subcontractors, owners and designers obtain an accurate measurement of project selection risk. It looks at five business/project categories and asks the reader to answer several questions about each:
- Project Fit
- Firm's Experience
- Project Complexity
- Financial and Cash Flow Impacts
- Contract Issues
In addition to the 25 scored questions, there are six non-scored questions for use of the practitioner to consider in the risk evaluation decision-making process. While project size, type and location are the primary aspects of a project that affect performance, the program provides valuable insight into the various issues worth looking at such as labor, skill levels, subcontractor quality and availability, unusual design elements, estimating, owner expectations and the number of company employees that already have direct experience on similar projects.
Dr. Schleifer's program is a nifty tool and will help construction professionals in learning the strong and weak points on new projects, resulting on the improved chances of success. The program can be accessed at www.simplarinstitute.com/ProjectSelectionProgram. Paid ENR subscribers can access the article here.