6 Tips Measuring Success ROI

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e-Builder.net 800.580.9322 info@e-builder.net 01/04/19 WHITE PAPER 3 4 5 6 Real-Time Visibility and Accurate Forecasting: During the program-planning process, initial project budgets and requirements are put together. Owners may pad preliminary project budgets for unforeseen conditions or based on early scope information. As projects move from planning to construction, project budgets and cost commitments become more refined. By utilizing an owner-centric PMIS, project and program managers obtain accurate cost-forecasting visibility for the duration of their projects. Accurate early forecasting can uncover unused funds that can be reallocated back into the program budget early, allocated to other projects that are at risk for cost overruns, or used to execute additional projects to meet strategic goals. PMIS systems also hold a wealth of historical project data that can be used to accurately plan project budgets in the future. Refuting Claims and Disputes: Disputes and claims still will come up on projects. The key is how prepared will you be to refute and minimize their impact by having an accurate audit trail of documentation, activities, and players involved? With a PMIS, all this information is consistently captured by an owner in one central location and can be quickly and easily retrieved. Hundreds of thousands to millions of dollars in claims can often be avoided by being prepared beforehand. No owner wants to incur long, drawn-out claims negotiations, pay significant legal and discovery fees, or attract negative press to their organization. Program Transparency: In public-sector construction projects, there are often audit or reporting requirements to reflect how funding was allocated, or special procedures for processing changes to projects. PMIS allows government agencies to automatically track and put controls in place so that the project remains in compliance with codes. In addition to this, when public-sector construction programs can provide quantitative data indicating that projects are on time, on budget, and within scope, it makes it easier to raise federal, state, and local funds through bonds and other financial sources. Health Care Project: Recently, a major health system thought it was in good shape at the start of construction on a $350 million project, but wanted confirmation. After an extensive project audit, risk assessment, and cost-forecast analysis, it was determined they were $19 million over budget based on decisions they had made. The program manager had never analyzed the risks inherent in a complicated $350 million project, nor did he evaluate the probability or severity of those risks, or forecast the anticipated "end" cost of the project. The project manager was struggling to manage the amount of data and decisions coming at him from the large national design and construction firms involved, so typical risks were not accounted for in his budget. He mistakenly led stakeholders in the organization to believe they had funds available to add scope when they did not. They had deviated from their own strategic plan and were spending on items with little or no return on investment. It was painful to rewind the project, but by setting up proper controls and a formal cost-recovery plan, the project was ultimately brought back into budget. If the problem had continued unnoticed without proper controls in place for an additional three months, the project would have been too far down the road to pull back. Public-Sector Project: A public authority was known for hiring inexperienced staff and providing slow response times and late payments. It had few bidders (always the same firms) for projects, and over the years, contractors took advantage of the situation. Contractors were known to underbid the actual cost to keep out competition, then later load the project with change orders to make up their financial position. The authority recently began a major capital-improvement program that called for tripling its annual construction effort, so it wisely hired outside firms to assist in implementing better procedures and leveraging e-Builder as its PMIS. RFIs, change orders, submittals, and invoices are moving through the system much faster, and new firms are taking notice. Without this change, they would never have been able to implement the number of projects it will take to carry out the entire capital- improvement program. Schedule and project costs would not be well-controlled. Additional Project Examples

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