What is Subcontractor Management Plan
The subcontractor Management Plan describes the relationship between the client/contractor and contractor/Subcontractor while they are working on a project. In order to build long-term business partnerships, contractors must use a variety of strategies to deliver high-quality output on time and on budget.
The process of managing subcontractors can be split into four levels:
1. Pre-award level is primarily concerned with identifying a project’s needs and recruiting individuals capable of fulfilling those requirements.
2. Award level entails defining basic project work criteria, such as safety standards, as well as qualifying and obtaining the actual contract.
3. Post-award level includes monitoring subcontractor performance and maintaining continuous communication.
4. Close-out level ensures that the engaged subcontractor has performed satisfactorily on all agreed-upon responsibilities.
Selection of Subcontractor
When a contractor engages a subcontractor, the reputation of the contractor’s company depends on the subcontractor. Experienced/qualified subcontractor are crucial to the successful completion of project’s tasks.
Therefore, Engaging subcontractors is a critical step with the appropriate experience and the capacity to do the task/activity safely, on time, and on budget. subcontractors lowers the risk and increases the probability of a project being properly done.
Subcontractors are usually hired based on the lowest bid of the contract. Generally, Low bid contracts may not assure that a project will be delivered on time and within budget. Lowest-bid contracts have a higher rate of change orders throughout the procedure, which enhances the overall cost of the contract and ultimately resulted in delays and failed projects.
The following things must be fulfilled when going through the engagement process.
- Similar projects experience
- Failure project details
- Sufficient resources to complete the job
- History of litigation or other legal issues
Managing of Subcontractor
The process of supervising the existence of one or more subcontracts for a client/contractor.
When it comes to managing your subcontractors, construction management software is a lifesaver. It simplifies scheduling, maintains a written record of all conversations, and lets you to know where the subcontractor is on the project.
Even more significantly, it assists you in sticking to your budget. Many of the systems available interface with accounting software to make invoicing and payments more efficient.
Above all, Construction management software manages projects from planning to completion. Stay up to date on every construction project’s progress by sharing files, comments, checklists, and other services. Moreover, view your data in a variety of ways to keep track of all areas of your project, from budgets to accomplishments.
Three points to remember when managing the Subcontractors
An agreement describes the scope of the work includes the project requirements and specifications. Any terms and conditions should be defined and explained to the subcontractor in a clear and concise manner.
The following are some of the terms and conditions of agreement:
- Scope of contracted work along with project requirement and specifications.
- Value of the contract and schedule of payment.
- Completion period of work
- maintenance of valid license, insurances, approvals and permits from respective department.
- Termination of the agreement
- Liquidity damages
- All aspects of remuneration and payment methods must be mentioned.
Communication plays a crucial role in a project. It is necessary to communicate in a simple manner whenever it is feasible. Miscommunications leads the project to run beyond the time and budget. In order to overcome the miscommunication, always keep a record in written correspondence on how the disputes arise and resolved.
Conduction of daily meetings will keep everyone informed and on track once again. Subcontractors can also use these sessions to convey any concerns or issues they have about safety, quality of work, general project issues or disputes.
So, Throughout the project duration, the contractor shall be open to the feedback of the subcontractor. Working as a team ensures that the project to deliver high-quality output on time and on budget.
It is essential to keep track of written correspondence such as confirmation letters and mail approval documents. Even if individual drawings or documentation required to execute the task have been submitted, subcontractors may claim they have not received them.
To ensure that you’re protected and to avoid any delays in the construction project, have your subcontractors sign any drawings, revisions, or documents they receive. Hence, every copy of their correspondence is crucial in the event of future disagreements.
Some of the following reports shall submit to the contractor on required basis:
- Project progress and status
- Planned program and Budget requirement
- Organization of manpower and machinery
- Reports such as inspection, disputes, etc.
Performance of Subcontractor
Subcontractor should abide the rules and regulations that are set forth in the contract. The contractor should monitor the task’s progress on a daily basis to determine if it is on schedule or within budget. Subcontractors should report on the status and performance of their contractual obligations.
Here are some of the points that describes the performance of the subcontractor
- Delivery of quality work
- Ability to commit to a schedule and meet deadlines
- Completion of the project within the budget
- Techniques for management
- Professional behavior
- Submission of reports on time
- Completion of project ahead of schedule
- Fulfilling the project’s requirements
In conclusion, Add the subcontractor to a list of approved contractors for future reference if they done a good job. Meet with the subcontractor to discuss what may have been done better if the subcontractor didn’t meet your expectations.
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Also Read: What is Earned Value Management and Uses?