The real estate industry is transforming in India. Its expansion in the recent years has made it a big money churner system for various developers and builders. However, the recent negativity in the market made it slower than ever. The buyer sentiments have been the hardest hit. The reasons for the current situations are plenty. The major source of problems is improper project management and handling of the real estate project. Beside the casual and seasonal operators, the well-established builders also find it difficult to manage a project. They need to understand that money, people and time needs to be channelized properly in order to get the desired product.
Estimation – The estimate of the project till its completion is one of the foremost step before indulging into the project. Even though an estimation may be incomplete, unstable or uncertain it gives a fair and practical idea about the work that needs to be done. The first step to estimate is researching with a sample. Next is covering all the aspects of a project be it construction, marketing, man-management, costing etc. Estimation in project planning is highly significant as it gives a rough calculation of the raw materials required. Many times an external presence affects a project. Readiness towards such factors can increase the efficiency of the estimation. Real Estate projects are heavy work processes and any mistake in the estimation will have the potential to destroy the project completely.
Planning – After estimation comes the planning. Precise planning and data collection are the steps forward. Planning across people, time and money are the focal points.
(i) People – The entire working of a project depends on how people are managed and planned to work individually and together. A project requires various uses of people such as labor purpose, designing, management, sales, cleaning etc. Any real estate project is big. There are cases where people are less or more which creates additional problem in the future. Thus, accurate planning in the number and quality of people with their specific work is important.
(ii) Time – Many real estate developers and buyers face the problem of delayed possession. Time is the essence of work. There is no point in doing a work after its stipulated time is passed. Same happens in real estate projects. Time management, hence, is a valuable facet. Setting deadlines to finish off minor to major work is a good way to manage time. This will stop the dragging process. Creating a timeline for the project is a tried and tested method.
(iii) Money – Just as deciding where and how to make use of people and time, money usage is also planned. Money in real estate has vast uses. There are many cases when a builder forgets that use of money can be at various levels. The cost of raw materials, land, man-power, office, stationaries etc. can create many disturbances in the later stage if they are not handled well.
Execution- This is where every above mentioned things synchronize with each other. Execution just does not means to put a tick mark against a worked done, but it is about many things. Firstly, the team members must be led to have a common understanding of the project. The major responsibilities, implementation strategies and key parameters should be documented. Development on initial studies should be ensured. An execution process must possess a Master Plan which has the blue print of all the key functions required in the development of a project and helps to track the plan. These should be in the form of a critical path logic diagram. If man-power is managed well, then execution process becomes somewhat easy. Thus, designating work according to the skills of people is necessary. The execution must yield an efficient and effective work. Monitoring and controlling is a big part of project execution process. These activities run in parallel with execution process and helps to oversee the project. The observation and measurement comes hand in hand with monitoring and controlling which ensures that any variation in cost, schedule and plan comes with in the acceptable frame of the overall project.
Closure – Closure in real estate business has a lot more value than any other. As the project runs for an average of 1-3 years, the firm must first segregate people who work permanently and who work on contract basis. This might be tricky as cost of permanent and contract workers vary. Also, dismantling the resources and team properly is important. At the same time a firm should take responsibility after the completion of the project. For that, some of the permanent members should be engaged.
A real estate project in a developed country is handled with sheer professionalism and precision. But in India, this is often not the case. Builders should spend some money in project management as that will decide how efficiently a work is done. As the real estate project consist of various fields, a project manager should be able to oversee the completion of the project. These large-scale projects can be carried out on time and on the prescribed budget with slightest disturbances only through a dedicated project management system.
Project Management in Real Estate