This past week, I spent some time meeting with clients and generally discussing the day to day operations of construction companies. One common theme of these discussions (and of this construction blog) was the need to deal with problems at a job site early. I have often discussed the contract side of catching things early, and firmly believe that this is the first step to a successful construction project. This post is about the equally important “operational” side of this advice.
What do I mean by “operational?” Essentially, while the contract negotiation and drafting tries to anticipate problems that might occur, the operational side deals with problems on a job site as they occur. In short, moving from what might occur (something I as a construction lawyer think about all the time), to what is actually occurring when putting that contract to work. Whether you are a general contractor, owner, subcontractor, or supplier to a construction project, you are likely well aware of the fact that Murphy was an optimist and something will go wrong. How you deal with this fact can be the difference between a successful, profitable project, and one that ends up in litigation (read: not as profitable). However, in order to deal with a problem properly, you need to know about the problem before it explodes. Without this knowledge, a problem could fester and lead to non-payment, subcontractor mechanic’s liens, and other headaches that don’t need to be further mentioned here.
The best source of this early information are those in the field working on the job. Your superintendents, project managers (particularly those assigned to just one project) and workers, particularly those with experience, are often the first to sense a problem on a project. An experienced superintendent will know when a subcontractor of your company is having issues or if the project manager for the owner or general contractor is causing job problems long before those at the office are made aware of the issues. Often the first the office may hear about an issue is through either a demand for payment, a 48 hour notice, or some other unpleasant means.
How to avoid this? Train your superintendents, project managers, and even less “managerial” employees to mention any concerns they have to the next level up in your organization. It is better to get more information about concerns, whether founded or otherwise, regarding the progress of a construction job than less. With the information, you as the owner or supervisor at your construction company, can filter it and decide a course of action. Most of the time, armed with this information, the parties should be able to work it out without litigation or escalating the problem from a minor hiccup to a major headache.
While you may think you’ll be flooded with unnecessary information, remind yourself that without this information you could be flying blind and end up calling your friendly neighborhood attorney to discuss ways to respond. Such a phone call will not be a profitable one.
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