Australia is basking in the glory of its most successful Olympic campaign ever. My favourite Paris 2024 story comes from Cameron McEvoy, who won his first-ever Olympic gold medal in the men’s 50m freestyle event.
McEvoy, an astrophysicist and mathematician, has had a successful swimming career but has never quite climbed into the top spot on the Olympic podium. Following Tokyo, McEvoy took an extended break from swimming, during which he meticulously analysed data about his stroke and technique. Combining data and sports science, McEvoy returned to swimming with an unconventional training plan that radically reduced time in the pool, substituting it with alternative activities such as weight training, callisthenics and rock climbing.
It made me think about ways that contract managers can use data to improve contract planning and management processes, setting them on the path for gold medal project outcomes. Here are three examples that came to mind.
1. Identify and mitigate common risks
Every construction project carries its own set of risks, but many of them are predictable if we have the right data. Many contract managers have access to historical risks registers and “lessons learned” reports that can be mined for helpful information.
By reviewing past projects, contract managers can identify common issues and contract provisions that led to delays, cost overruns, or disputes. For example, a particular program sequence or site management team might have run into issues on similar projects in the past.
Or, maybe certain subcontractors have a history of underperformance. Data can inform better decisions about who to engage, or how to manage their performance more closely.
2. Set realistic targets for time and cost
Data from past projects can help contract managers set realistic benchmarks during contract negotiations. Revising similar projects can red flag issues such as:
- actual time taken to complete certain tasks differing from conventional benchmarks
- seasonal escalations in the cost of materials or labour
- common scope changes or site issues
This information can be used to set clear expectations and negotiate more effective or project-specific contract provisions, including variation and EOT clauses.
3. Creating effective payment regimes
Effective payment structures are crucial for maintaining cash flow and ensuring that all parties remain committed to their obligations.
Data from past projects can reveal patterns in cash flow issues or disputes related to payment terms. For example, if the data shows frequent disputes over milestone payments, it may indicate a need for clearer definitions of requirements to achieve milestones or more detailed progress reporting requirements. By fine-tuning payment terms based on what has worked (or not worked) in the past, contract managers can create payment structures that are fair, transparent, and less likely to result in disputes.
“History doesn’t repeat itself, but it often rhymes”.
I love this pithy little quote, usually attributed to Mark Twain. It’s another way of saying that using data from prior projects isn’t just about looking backward; it’s about building better contracts for the future. By identifying risks, setting realistic benchmarks, and refining payment structures, contract managers can create more robust and effective contracts and contract management plans. In projects where the margin for error is slim, these improvements can make all the difference.
