Project Management Costs Money: – Fact or Fiction?
It is often simply fictitious to think of professional Project Management as a cost centre
So, I am quite confidently able to tell you that there are very many occasions when the correct answer to the question above would be ‘Fiction’ as Rob, the owner of the following project in Brisbane suburb, Wooloowin would attest to. His leafy corner site close to the train line is about to be transformed!
You see, almost 2 years ago when Rob first approached us he would have answered that question as ‘Fact’ and for that reason decided that it was a cost that he could do without so decided not to engage us – he’d go it alone.
About a year later he approached us again and we again discussed things and provided him with our fee proposal and scope of work. After some deliberation he again decided to go it alone.
Roll forward to 2015 and he came back to us with much the same questions although he had made some progress in the meantime. He’d been busy – very busy in fact – gaining approvals, organising plans and arranging quotes even, but he just couldn’t get it to work either physically or at a feasible price.
If you drove past Rob’s leafy corner site you would see a character home with seemingly very little room for anything else. Understanding that the character home has to remain you would be left scratching your head wondering how on earth one could retain the house and the pool and fit 2 new townhouses. Well scratch no more because that’s what is about to happen.
Rob’s project involves picking the house up and moving it within the site, demolishing and dumping the under structure, partial demolition of the house, some renovation as well, rebuilding under it in its new location as well as building the two new townhouses, landscaping and fencing. We made some changes to his plan where we could to save money without detracting from the end product.
For all this Robs contractors were quoting around the $1.1M mark with quite a few PC items listed.
Our final accepted price – all fully quoted and documented with a fixed price contract – under $850,000. That’s a saving around $250,000. Those changes we made probably accounted for $60,000 of that – the rest? Put it down to our systems and ‘know how’.
Our fee? Little more than 10% of the savings achieved to take it all the way to completion and that’s why Rob would now agree that Project Management does not cost money.