Case study: How daily reports saved us over $100,000 for our construction project

You may wonder how this is possible, but in fact daily reports helped us to save over $100,000. A few years ago the company I worked for was contracted with insulation works at energy from waste plant in England. Tendering process was tough and the competition was undercutting prices all the time. However, we managed to win this package of works and soon started working at the new power plant construction site.

Good construction management starts with planning and keeping daily records

We knew from the very beginning is was going to be a difficult construction project. Major issues were space constraints for storage of materials and extremely tight construction schedule. With these two factors in consideration we had to focus on construction project management. In simple words we needed to be sure we do not loose a day of  productivity on site. We planned material order in advance. We also coordinated these plans with our workforce on daily basis. Construction sites can be very unpredictable. Situations change all the time. That is why it was of paramount importance to us to keep daily records of major issues. We worked with a simple template for daily reports. On a single page we described work progress, deliveries, issues and obstacles on site. We also added weather details, manpower and equipment resources.

Before we commenced with our works at the construction site we prepared our construction schedule. It was based on the information and documents we received from our client. We had to plan and arrange our works. We were depending on other subcontractors working for the client to finish their works first. This way we could start with our insulation works. You cannot insulate a pipe if that pipe has not been installed yet or even worst, when it was not delivered to site. Our construction programme showed completion of works by other trades as milestones. It was critical for us us to make sure that these milestones were met. It was also important to keep details of any obstructions within the daily reports.

We made sure we added details about issues into daily reports

As the project progresses it became more tedious to fulfil the requirements of our construction schedule. Other trades, like mechanical contractor or civil contractor did not make it easier for us. Therefore, we recorded this information in our daily reports. What did we write there? Short, but relevant and detailed description of issues that were happening at this construction project. For example, we noted down that we could not have started with our insulation works as the working area was blocked by scaffolding belonging to another contractor. Details about the area and level were also added. If another trade did not finish their works and did not remove their scaffolding we were not able to work there.

Why did we need them to finish first and why we could not work simultaneously? The other contractor was doing conducting a lot of welding works which created a lot of hot sparks which were safety and fire hazard to our workers and materials. What is more, they needed clear view of the areas being welded and if we started covering these areas with insulation material we would be hindering their works. Another example of issues that we wrote in daily reports was that mechanical contractor did not finish their works and our scope could not have started until the other trade would be fully completed and cleared the working area for further companies. It was simply impossible to work along fixers or welders when they occupied larger space of the work area with lifting and installation equipment and it was unsafe to bring more manpower there.

Daily reports are only actionable if shared with the client

After few months it was clear that we were not able to finish on time with our subcontract at this construction project. When situation like this happens it is not only important to keep daily records of all the issues and activities on site. You need to communicate them to your client on regular basis. It does not help any one if you just create daily reports and save them in your computer folder, mobile phone or paper folder.

We kept the client informed about the delay during construction time

In order for others to take action and prevent further delays all these issues need to be shared with relevant parties and most importantly with your customer. If they do not know about these issues they cannot help you. Therefore, we sent daily reports to our client every day. And every week we sent weekly report which highlighted major issues. What is more, during site meetings we made sure that these delays were discussed and noted in minutes of meeting.

When our deadline for completion of works passed we were not even half finished with our construction works. Since our package was almost the last one in sequence we suffered from the knock on effect and delay of every other trade who worked before us contributed to our delay. At that point we notified our client on numerous occasions that it was not possible to meet the contractual dates. Our client seemed to understand all these issues and reassured us that they were doing everything they could to remove any obstacles and that we should have continued as fast as possible.

It was a huge problem for us because during tender phase we anticipated only 6 months of work. Duration of construction site influenced a lot of items from the contract price.  It had almost no correlation to the quantity of works. We paid our construction site management personnel on monthly basis. If delays happen our staff still needs to be present to make sure works are safe and with the required quality standard. The same formula applies to any rental equipment and site facilities. If your construction project is delayed you still need to provide sufficient tools and facilities to your workforce.

Delay in construction phase can attribute to big financial loss

All these monthly costs accumulate and add huge amount of money to your costs bill. Sometimes, these costs could drag your construction project to deep negative results. But if the delay is not caused by your own actions and mismanagement or any misconduct under your construction contract than you should not bear these costs by yourself.

We knew we were not entirely responsible for this delay. That is why we asked the client for more money to cover the indirect costs. We claimed that due to the delay of other trades we had to incur additional costs. Client should pay for these costs as they did not provide the construction site at the agreed and expected terms and conditions. Of course the client was not happy with such a claim. However, we were assured that we would be compensated. We just needed to continue with the works and if we increase the manpower to speed up the works.

It took us another half a year to finish our contract at this construction site. And when we were almost done we received a letter from our client. They demanded that we pay liquidated damages as per our contract due to not keeping the contractual dates. At that time our claim for additional costs reached the higher number than damages requested by the client. We agreed to meet for negotiation and settling any commercial matters on this construction project.

Detailed daily reports helped us to prove we were not causing the delay

We had to prepare well and make sure were able to present all the relevant documents showing that this delay was not caused by us and that we were not subject to liquidated damages. It took us almost two weeks to go through all the project communication (both electronic and paper). The aim was to make a summary of all items that contributed to the total delay. We started looking into daily reports and highlighted all the issues which were our roadblocks. The task was difficult because we did not have dedicated software for managing our daily reports like iNeoSyte app.

We had to open each and every report to check for specific area and specific scope of works. This way we were able to to see any obstacles referring to the contract. Once we found details about the delay we checked project emails and construction programme. Once again, we highlighted the details and summarised them in our delay report. At the end we came up with chronologically structured report referring to our progress on construction site. All relevant documents and pieces of communication that we issued to the client which presented details about the delay. This was our evidence that this delay could not have been entirely attributed to us.

At the end daily reports helped us to save over $100,000

Finally, we met our client and discussed our claim and penalties from the contract. This meeting was not easy as the client kept their records of site activities and referred to our daily reports. We were not without fault. Obviously we also made some mistakes during the construction phase. A small percentage of the delay was our own fault. However, thanks to meticulous record keeping and proper construction management team our client waived the whole amount of contractual penalties. Moreover, we were able to prove that we incurred indirect costs which were covered by the client. Thanks to daily reports we were able to save over £100,000 in liquidated damages. A simple document filled in every day proved to be lifesaving for our construction project.

Daily reports software facilitates keeping records from construction site

We just wished that the whole process of making field reports was easier. Traditional paper method or using office software were time consuming. At the end it was also extremely troublesome to search for relevant details within these reports. Now with daily reports software like iNeoSyte all these processes can happen faster. Which in turn helps your construction company to save even more money.

Would you like to test quick and easy way to create your field construction reports directly from your mobile device? Download iNeoSyte for free and save time spent on construction documentation.

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