Do you remember your Project Management 101 class where the instructor shared “building a house” as a project management example? We all nodded our heads and agreed that scope, cost and timing were all important, and it was an adequate training example. I never realized how relevant this training would become until I started building my own home.
When it comes to our day jobs, we manage corporate budgets and make decisions that affect the anonymous entity called “the business.” If there are scope changes, delays or even budget overruns, these are impacts to the business that project managers need to justify and solve. If the project is late or over budget, it’s a business impact and not a personal one. All of this changes when the budget responsibility shifts from corporate dollars to personal dollars!
Whenever I tell someone I’m building a house, I get grimaces and war stories. Friends and family members share stories of changing costs, poor management and continued project delays. Below are a few of the cost, timeline and quality building problems (i.e. risks) that when managed with a project management mindset, don’t seem so scary. The goal is to turn them into manageable and acceptable risks.
1. “The cost of the house kept increasing after the purchase agreement was signed.”
Building a home is likely the largest personal expenditure that you’ll pay and manage in your lifetime. The stories of increasing costs were directly influenced by the home owners not knowing all of their wants and desires in the home. Project managers call this scope definition and requirements “management.” The builder is happy to augment the size of a room or change the quality of materials but he needs to know these requirements up front. It is a lot cheaper to erase a line on a blueprint than tear down and rebuild a wall.
One approach to control the costs is to ensure the scope is well defined up front. If the builder has a model available, the buyer can walk through each existing room, make a list of questions and clarify the assumptions with the builder. If there are potential changes, they can ask the builder to quote the cost up front for future consideration. The key to ensuring costs are maintained is to ensure scope is defined to a sufficient level of detail and it is written in the contract.
2. “We couldn’t control the builder’s timeline.”
A builder will tell you they will try to build your home as quickly as possible, but they can’t control the weather. I heard other stories of builders delaying the start of the project because they had equipment in other home developments and they needed to finish those projects first. The reality is builders have enough history and experience to estimate a timeline range based on building conditions.
One way to mitigate the risk is to include a penalty clause for late delivery. By establishing a project end date and attaching penalties for missing the date, the builder will be motivated to complete the building per the terms of the contract. In our corporate projects, our stakeholders have expectations for deadlines, and hold us to them. The same should be applied to your own personal project.
3. Low Quality Product and Poor Customer Satisfaction
The home construction industry is full of builders who build homes of varying levels of price and quality. In the corporate world, we typically conduct customer reference calls and site visits to confirm the potential supplier does a quality job with high customer satisfaction. The same process can be applied by contacting the city building authority and requesting customer testimonials and feedback from the builder. Reach out across your own social network and get feedback from other customers.
Remember: You Are A Project Manager
In these examples, there were problems with cost, time and quality much like any other project. Even though it is funded by your personal dollars, building a house is still an effort that needs to be treated like a project. The builder may be the one constructing the house with a team of sub-contractors, however, you are the client hiring the builder to do a job for you. Consequently, you also need to be the project manager who needs to initiate, plan and monitor the project’s execution.
In my own building example, developing the cost and scope took longer than my family expected. My wife was already putting a key into a door that hadn’t been built yet, while I was ensuring all the assumptions, issues and terms were negotiated before we signed a contract. Throughout this entire process, the personal challenge was to avoid becoming emotional and committed to a project with unacceptable risk. By approaching the new home with a project management mindset, it wasn’t so daunting.
During the contract negotiation process, the builder joked about creating a Gantt chart for the project. I surprised him when I told him I’d build one for him and he realized I wasn’t kidding. The project management skills you apply at work really do translate to your home life.
About the Author
Dr. Andy Makar is an IT manager, author, instructor and lecturer on a range of project management topics including PMO management, ERP implementation, application portfolio management, and infrastructure management.
