Projects are inspiring – the feeling of starting something new, organizing the kick-off, presenting your plans to the client and your team, ensuring that expectations are realized, managing your budget, your planning, your scope and ensuring the quality of the project’s outcomes…
White Paper - Capital Project Management
Real estate and facility management teams handle a lot of capital projects, from renovations to new construction. This whitepaper covers the basics.
Projects are forming an increasingly greater part of the modern workplace. Activities that do not belong to the core process of the organization are outsourced, and this often includes the operational tasks of real estate and facilities management. The internal team becomes smaller, organizations lease buildings with flexible contracts, and initiatives around The New Way of Working are rolled out. Whereas previously emphasis was placed on the implementation and management of projects with an internal team, the focus is now on managing a project portfolio with a mix of internal people, suppliers and external advisers.
It is important to keep an overview of projects. This not only concerns the 10 or 20 current projects managed by the internal team, but all projects within the organization that you wish to keep track of. You not only need to keep an overview of the current projects, but also of projects planned for this year, next year or an unknown term.
Operational projects or investment projects
Project management is often a supporting process. Organizations have become accustomed to managing smaller projects themselves, such as relocations, events or small structural alterations. Project management on such a small scale is achievable, particularly since these types of operational projects are funded by annual budgets. Moreover, operational projects are generally managed by the operational department.
It becomes a different story altogether when the number of projects increases or when the projects become bigger; such as lease extensions of large office buildings, sustainable investments or large renovation projects. The financial impact of these types of projects is greater and the financing sources are different. Multiple money flows such as budgets, financing, subsidies and funds come together with information flows and orders. Managing the project portfolio with respect to planning and budget becomes more complex, certainly when several project leaders use their own methods and resources. The danger is in losing control and track of the situation.
The need for insight
In order to provide employees with the necessary structure to help them manage these bigger, often more complex projects, it would be wise to move from Operational Project Management towards Capital Project Management. Large investment projects require appropriate funding, greater involvement from senior management, and specific insight into the four areas of budget, planning, risks and deployment of people. It is of particular importance when using subsidies or public funds to demonstrate where the various funds come from and how they will be used in order to justify the costs.
Capital Project Management places emphasis on the management of financial flows in order to timely identify any issues and ensure immediate action. Now that real estate and facility management are shifting to a leaner operations management, it is recommended that organizations focus on Capital Project Management. This concerns the integrated management of the project portfolio with key information on budget, planning, risks and scope for security, accountability and decision making.
Smart interaction of these four aspects leads to a project that is delivered within budget and on time, and to a project that keeps its promise. Projects are inspiring.
If you would like to know more about Capital Project Management then Planon’s white paper is available to download now.