The construction industry has a reputation for projects going over on time and budget. Fingers are normally pointed at the lack of understanding the brief, poor relationships/communication between parties and ineffective use of technology.
Rapid advances in technology have affected many industries, including construction. It is important for organisations to be able to adapt quickly: projects often fail due to ineffective risk management or poor communication when changes occur, an issue that is exacerbated by poor planning.
The software industry developed the agile methodology to deal with a fast evolving business environment. The difference is that the project is broken down into small fixed time frames known as sprints. The principles that are followed are -
Individuals and interactions are more important than process and tools;
Working software is more important than comprehensive documentation;
Customer collaboration is more important than contract negotiation; and
Responding to change is more important than following a plan.
Being agile encourages teams to test concepts before moving on to the next phase and use feedback rather than relying on predetermined assumptions.
Agile or traditional? Rather than having a top-down system where team members are told what to do by the project manager, agile principles enable those responsible for the work to decide which work to carry out.
The key features of traditional project management are as follows:
Scope is defined before work starts;
Payment is linked to fulfilling this in a predefined time period; and
Change is viewed as a risk and therefore discouraged, though some changes are inevitable.
Instead, the agile project management framework allows the scope to be constantly refined to provide the most value. The client, consultants and contractors work together with common goals that take this into account. The differences between agile and traditional project management are shown below.
Construction projects often fail to meet customer's expectations because project teams are unable to communicate properly or deal with change effectively. The software industry has successfully responded to similar issues by focusing on providing value and adapting their contractual approach for the customer.
Customer input is vital to ensuring that the project team hone in on value- generating tasks. Contract strategy is vital to allow both parties to communicate freely without jeopardising their commercial positions. Over a period of time, trust must be built between parties to encourage iterative learning and project team members must be able to talk about the mistakes they have made.
Software companies have found that fixed-price contracts are not a good match for agile principles, as projects working under such principles must embrace change. The use of contingency and other measure are put in place to manage risk, allowing a greater free flowing project. Moreover, the software industry generally align to alliance contracts that utilise painshare and gainshare provisions.
In construction, shared risk and reward contracts are becoming more prevalent. Several standard forms of shared risk and reward agreements already exist. It is important that shared risk contracts provide value for the client and allow the contractor or design team to make a fair profit, as it is for all stakeholders to be given adequate governance of their risk.
The agile approach to Project management is not often applied in the construction industry. There are a few reasons for this but it is mainly due to the engrained nature of the "us versus them" mentality.
Older construction contracts have been developed to avoid risk. Shared risk and reward contracts appear to be better suited to the agile way of thinking. Conversely, the fragmented nature of existing construction practice and the potential cost of learning are barriers to implementation.
Despite these hurdles, there is great potential for the methodology to have a positive impact in construction and overcome significant issues in terms of time and budget management.
There are positives and negatives to agile project management in construction, mainly it lends its' self to the design and planning stage. When using more traditional contracts agility is harder to implement.
A construction project can not be 100% agile with complex designs, specifications, building regulations, planning etc. Unlike software, feedback loops of what works well and what doesn't are a lot longer and more complex. However, we can leverage agile concepts in creating a hybrid modal. Elements that require to be fixed like contract procedures will stay such way, however design, planning, contract selection, procurement and lessons learnt need to have an agile approach.