5 Signs Your Construction Project Is at Risk

A lot can go wrong on a construction project. That’s the nature of the work. You’re managing multiple trades, tight schedules and budgets that don’t leave much room for error. In most cases, problems start small and build when no one addresses them, and by the time someone does notice, the job is already behind.

Experienced project managers catch issues early, while there’s still time to correct course and limit the impact on cost, schedule and safety. But with the industry in the middle of a handoff—with newer professionals assuming roles that were historically filled by more experienced teams—early detection doesn’t happen as often as it should.

“We have more people stepping into these roles with less experience than we did just five to 10 years ago,” says Ethan Cowles, partner at FMI. “They’re being asked to make budget, schedule and scope decisions much earlier in their careers, and don’t always recognize the signs or symptoms of a project going sideways.”

On most jobs, the early signs are there. But they may get written off or ignored until they start affecting performance, cost and project outcomes. Here are five red flags to watch for.

Red Flag #1: The Plan was Shaky from the Start

Every project needs a baseline: a budget, a schedule, agreed-upon milestones and a shared understanding of what success looks like. When those elements aren't in place before work starts, the team is reactive from day one.

Cowles says this is especially common with self-performing contractors who mobilize before a GC has issued a well-defined schedule. They hit the jobsite without concrete answers on staffing, durations or priorities, and without those basics, there's no way to know when something's going wrong.

"A lot of contractors go right into a project without a plan, which means they're reactive from day one,” he explains. “They don't have those measuring sticks for schedule or budget.”

There was a time when experienced crews could compensate for a lack of planning, but that approach doesn’t work in the current environment. With less experienced teams running the job, a shaky plan can quickly spiral into delays, overruns and finger-pointing.

Red Flag #2: Unreported Schedule Slippage  

When a project starts slipping, the schedule is usually the last thing to get updated. Look-ahead schedules stop reflecting reality, milestones move without a recovery plan and project managers dodge the hard conversations with owners and subs about where things actually stand.

Cowles has a reliable way to spot this one. Walk into the contractor's office and look for the Gantt chart. If the revision date goes back to the project kickoff and the only updates are scribbles and highlights, that’s a sure sign that something’s off.

"When the schedule stops getting updated, it stops being a management tool," he says. "You lose track of priorities, what's changed and what's actually happening on the job. Without those reference points, you won't even know you're in hot water."

Unresolved changes add to the problem. For example, when a subcontractor raises an issue and everyone ignores it, the job keeps moving as the problem festers. "At that point," says Cowles, "nobody knows how far behind they are until it's too late to do much about it."

Red Flag #3: Scope Creep Without the Paper Trail

Scope creep is deceptive because it doesn't always look like a problem at first. If no one is documenting and tracking that small request here or a minor adjustment there, the contractor winds up doing work that wasn’t authorized or budgeted for.

Cowles sees scope creep play out in two ways on the typical jobsite. In the first, a contractor knows the work is outside scope, says something and gets ignored. Or, the field crew doesn't even know what their scope covers. A GC's project manager calls the shots, the foreman figures it's just part of the job and nobody pushes back.

If the project manager doesn’t document the new requirements, scope creep can be almost impossible to catch until the margin is already gone. "In some cases, the field crew doesn't even know what their scope covers, so when a GC's project manager directs extra work, they just do it," says Cowles. "Nobody pushes back, nobody documents it and the contractor ends up absorbing a significant amount of work they never got paid for.

Red Flag #4: Field and Office Are Running Two Different Projects

If the field and the office aren’t communicating properly, superintendents and project managers end up misaligned on priorities, owners get conflicting information and nobody's working from the same playbook.

Cowles says the disconnect can quickly spiral into major, undetected problems. For example, the field may think everything's fine while the office knows the job is losing money. Other times, crews are dealing with real problems onsite while the office keeps telling the owner that everything is under control.

He also says you can read a project just by walking the site. A well-run job is clean, with trades working in sequence. A troubled one has contractors stacked on top of each other and nobody knows what they should be doing next.

"You can tell a lot about a project just by walking the site," says Cowles. "How clean is it? Are trades stacked on top of each other? Does anyone seem to know what they're supposed to be doing that day? If not, that’s when you should start asking more questions.”

Red Flag #5: Crew Count Keeps Changing

Once a self-performing contract is underway, headcount should remain relatively stable. If a crew runs six workers one week, jumps to 12 the next and then drops back to six the following week, something's wrong.

“That kind of fluctuation doesn't happen on a well-run job,” says Cowles, who sees it as a sign that crews are reacting to events versus working a well-thought-out plan. Uneven scheduling and poor coordination are often the culprits. Crews get pulled in, pushed out or asked to accelerate without warning.

In many cases, it traces back to how the GC is managing the job. “Not every GC is invested in making their subs successful,” he explains. “Some are unresponsive and slow to answer questions, and others are flat-out absent. Cowles tells contractors to be selective about who they work for, knowing that some GCs keep a job organized and set their subs up to succeed, and others don’t.

Small Steps = Positive Outcomes

Most of these problems are preventable when they’re caught early enough, and Cowles says avoiding them starts before anyone even sets foot on the job. Have a plan and know the scope, milestones, staffing requirements and budget before day one. "I call it scripting the beach landing," he says. "The minute those gates drop, you're in the hot zone. You're going to need labor, materials, tools and information, and none of that should be a surprise."

Cowles also tells contractors to leverage their in-house experience and expertise. Most companies have at least a few people who really know how to plan projects. Have these folks work alongside the less experienced project managers, superintendents and foremen so the knowledge actually transfers.

"If you're not careful, you end up dependent on one or two people who know how to build a schedule," says Cowles. "Train your people to plan, be picky about your scopes and your GCs, and use every opportunity you have to bring your younger people along. Small steps can lead to some very positive outcomes."

Ready to strengthen how your projects are run and your teams perform? FMI’s Project Manager Academy equips you with proven, best-in-class approaches to drive efficiency, profitability and leadership impact. Explore upcoming sessions and secure your spot today.