Project Management is the field dealing with the study of the processes involved in the managing of projects, whether they are complex and of high value or simplistic and of a small budget. A project is an endeavor by a group of people working towards completing the project in the scheduled time and cost with the prescribed quality.
Today, we have many complex tools for managing our humongous projects With the sophistication in these tools, contract documents for projects are getting more stringent and punitive. With the increase in value of projects, their complexity increases and the requirements for sophisticated tools to manage them increase. With an increase in the value of projects, the inherent risks in the project also increase. The more complex the projects get, the more the people required for managing them, and the more sophisticated the tools being used therein. An increase in underlying risk also calls for an increase in financial jurisprudence.
These sophisticated tools serve the following purpose:
* Plan arrangement of finance at the prescribed intervals,
* Procure materials and equipments at the designated time for the construction,
* Arrange for men to work on the project.
* Arrange for sales of the project facility.
Tools like MSPROJECTS, PRIMAVERA, etc, help plan the project. Not only do these plans quantify the time and cost required for the projects, but they also provide information regarding the time of requirement of finance during the project duration. We also have SAP and ERP, which facilitate efficient procurement and delivery. Not only do these tools help us implement JIT principles, but they also reduce inventory holding costs, along with a reduction in space requirements for holding work in process and finished goods inventory.
With such sophisticated tools at our disposal, one would think that projects could be managed more efficiently, within the allocated time and cost and in the desired quality. Unfortunately, that is not the case today. I can cite numerous instances where, in spite of the use of sophisticated tools, projects have overshot their budgets and timelines. There are numerous instances where projects have gone over budget and surpassed their deadlines due to various reasons.
At times there is a problem of rehabilitating project affected people, at other times, the title to the land on which the project is being constructed is not clear. At still other times, there is a shortage of labor to work on these projects. There are instances where the client does not pay the contractor on time, resulting in a delay in the construction process. At times the drawings for the project may be delayed. There can be many more reasons for delay in project timelines.
Contract documents today stipulate heavy fines for delay in project timelines. A project worth 150 crore had a liquidated damages condition in the contract, which stipulated a penalty of 10% of the contract value per day of delay. Still another project had a stringent damages condition at 20% of the contract value per day of delay, for any delay above 90 days from the scheduled completion. With such stringent penalty clauses, and the still occurring delays, one would wonder how useful the sophisticated tools for project management have been.
The above question will give rise to a debate among people who are in favor of using sophisticated tools for projects and those who are not in favor of these tools. But all in all, my personal opinion is that these tools have only helped us to record the times and costs of projects that we undertake, and not actually reduce them.
Today, we have many complex tools for managing our humongous projects With the sophistication in these tools, contract documents for projects are getting more stringent and punitive. With the increase in value of projects, their complexity increases and the requirements for sophisticated tools to manage them increase. With an increase in the value of projects, the inherent risks in the project also increase. The more complex the projects get, the more the people required for managing them, and the more sophisticated the tools being used therein. An increase in underlying risk also calls for an increase in financial jurisprudence.
These sophisticated tools serve the following purpose:
* Plan arrangement of finance at the prescribed intervals,
* Procure materials and equipments at the designated time for the construction,
* Arrange for men to work on the project.
* Arrange for sales of the project facility.
Tools like MSPROJECTS, PRIMAVERA, etc, help plan the project. Not only do these plans quantify the time and cost required for the projects, but they also provide information regarding the time of requirement of finance during the project duration. We also have SAP and ERP, which facilitate efficient procurement and delivery. Not only do these tools help us implement JIT principles, but they also reduce inventory holding costs, along with a reduction in space requirements for holding work in process and finished goods inventory.
With such sophisticated tools at our disposal, one would think that projects could be managed more efficiently, within the allocated time and cost and in the desired quality. Unfortunately, that is not the case today. I can cite numerous instances where, in spite of the use of sophisticated tools, projects have overshot their budgets and timelines. There are numerous instances where projects have gone over budget and surpassed their deadlines due to various reasons.
At times there is a problem of rehabilitating project affected people, at other times, the title to the land on which the project is being constructed is not clear. At still other times, there is a shortage of labor to work on these projects. There are instances where the client does not pay the contractor on time, resulting in a delay in the construction process. At times the drawings for the project may be delayed. There can be many more reasons for delay in project timelines.
Contract documents today stipulate heavy fines for delay in project timelines. A project worth 150 crore had a liquidated damages condition in the contract, which stipulated a penalty of 10% of the contract value per day of delay. Still another project had a stringent damages condition at 20% of the contract value per day of delay, for any delay above 90 days from the scheduled completion. With such stringent penalty clauses, and the still occurring delays, one would wonder how useful the sophisticated tools for project management have been.
The above question will give rise to a debate among people who are in favor of using sophisticated tools for projects and those who are not in favor of these tools. But all in all, my personal opinion is that these tools have only helped us to record the times and costs of projects that we undertake, and not actually reduce them.
