Can You Afford a Project Manager?

Many homeowners look at the idea of hiring a Project Manager as an extra, unnecessary expense in their home building project. “After all,” they think to themselves, “I’m already paying an Architect and a General Contractor. Both of them are supposed to be managing my project, why should I hire another manager?”

That’s actually a very good question, one that I hope you’ll let me answer for you. First of all, these three people, the Architect, the Contractor and the Project Manager all have different functions, even though they look like they are all doing some of the same things. We need to understand what the difference between their different functions and different outlook is.

The Architect is concerned about the design of your home. He wants to build you something that is going to make him look good, while providing you with a home that will keep your family safe and comfortable. Although most Architects also claim to manage the construction project, what they’re really doing is making sure that your home is built according to their design and specifications; not trying to save you, the owner, money.

The General Contractor is concerned about how your home is built. More specifically, he’s concerned about how much it costs to get built. You have a contract with him, which limits the amount of money which you’ll pay for his services. So, he wants to make sure that the project costs less than that, ensuring his profit. He’ll do the best possible job, within those parameters. But, when push comes to shove, he’ll sacrifice quality to keep his profit.

The Project Manager doesn’t have to worry about the design or the profits. If you hire a Project Manager, he doesn’t need to worry about his profits, because you’re already paying him to do the job. His concern is that the whole project is completed in the best possible way, in order to make you, the customer, happy.

You see, the Project Manager is the only one of those three who is your advocate as an owner. He’s the only one whose best interests are to look out for your best interests. That makes his focus much different than the other two professionals whom you are working with.

The important thing in getting the maximum benefit from the services of a Project Manager is when in the overall project timeline the owner hires him. The greatest savings for the owner comes from hiring the Project Manager first, even before hiring the Architect. In this way, he can be proactive for the owner from the very beginning, before any other professionals are hired.

If the Project Manager is hired first, he can do the most good. As the owner’s representative, he can locate, interview and negotiate the best possible contract for the Architectural work. As part of this negotiation, the Project Manager can negotiate with the Architect to remove the extra costs associated with contract administration, communication and schedule management out of the Architect’s contract. Since the Project Manager would be handling these functions, there is no reason to pay the Architect for them as well.

By doing things this way, there is no additional cost to the owner for having a Project Manager on their home building project. In fact, since Project Managers typically charge lower rates than Architects, there would probably be an overall savings. However if the Project Manager is hired after the architect, then they are unable to negotiate the administrative savings, so the additional cost would be the cost of the Project Manager, less any savings that they can provide throughout the project. Finally, if the Project Manager is hired after the General Contractor, he is only able to provide damage control. His payment would be over and above whatever other contract costs.

If you feel that you need an advocate, someone who is looking out for your best interests in your home building project, then you need an independent Project Manager. Your Architect and Contractor may be friendly, qualified professionals; but they aren’t your best advocate, the Project Manager is.

© 2012, RCartright. All rights reserved.

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