With regard to Construction Management services, we coordinate all the stakeholders and subcontractors involved in a matrix-structure, assuming a more intensive role as opposed to supervising a single contractor, the general contractor.
We manage the implementation and construction process. The client is provided with the financial, legal and other guarantees (possibility of enforcing a withholding penalty or default interest) expected, but not from one general contractor, but from 20 subcontractors, in smaller amounts, interpreted in the context of the specific project.
In the case of construction projects, we strive to achieve cost efficiency, timeliness and premium quality at one and the same time. If any of these aspects becomes disproportionately important to the investor (our client), it is definitely worth considering a Construction Management arrangement.
The client must decide what risks it runs with a general contractor and what might be the benefits of replacing or mitigating these risks. For example, if the general contractor were unable to perform in a compliant fashion and on time then, in the classic model, the client would be exposed and vulnerable. In the case of CM, however, it is relatively easy to bring in another contractor to replace the one that is no longer involved. While in the traditional model, 3E does not directly intervene in the construction process, but only supervising the contractor, in the CM arrangement we also coordinate (often) large number of contractors. This means that we also directly manage technical implementation.
In addition to the project management and the construction supervision organisation, a third unit is also set up to carry out the tasks to be performed by the general contractor.
In an international multinational context, this model is used in practice as the so-called EPCM (Engineering Procurement Construction Management) model. For many of our clients, such as P&G, GSK and Mars, we see that international projects are carried out under the EPCM model.
The Construction Manager has the designs drawn up, announces tenders and implements the project as part of construction management. With CM, the investor receives guarantees of a different nature and has more control compared with the guarantees that a general contractor can offer.
The option of swift intervention is often taken into account with greater weight and significance. For example, if material delivery problems or capacity shortages arise and can be addressed more effectively, thereby better meeting what’s ‘set in stone’ for the project, i.e. the critical final deadline, this represents greater value overall for the client than that which the general contractor would have provided. Many dead ends can be avoided and the project can be more manageable for the investor. For example, when a project is delayed, the investor and its representative may try to take steps, but in fact have no control over the process and no means of managing the delay.
In the case of a CM construction, experience shows that we can intervene in time, for example by replacing equipment that is currently unavailable or by changing the supplier.
In summary, the risks under CM are different from those in the classic general contractor model, but often less dangerous for the investor. In addition, in most cases you will also save a percentage of the investment cost.
Within the 3E Group, the Construction Management service is provided by 3E Construction Management Kft.
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