General Managers in Construction – Roles and Importance

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The management of construction projects requires knowledge of modern management as well as an understanding of the design and construction process. Construction projects have a specific set of objectives and constraints such as a required time frame for completion. While the relevant technology, institutional arrangements or processes will differ, the management of such projects has much in common with the management of similar types of projects in other specialty or technology domains such as aerospace, pharmaceutical, and energy developments.

Generally, project management is distinguished from the general management of corporations by the mission-oriented nature of a project. A project organization will generally be terminated when the mission is accomplished. According to the Project Management Institute, the discipline of project management can be defined as follows: 

“Project management is the art of directing and coordinating human and material resources throughout the life of a project by using modern management techniques to achieve predetermined objectives of scope, cost, time, quality and participation satisfaction.”

By contrast, the general management of business and industrial corporations assumes a broader outlook with greater continuity of operations. Nevertheless, there are sufficient similarities as well as differences between the two so that modern management techniques developed for general management may be adapted for project management.

The working knowledge of general management and familiarity with the special knowledge domain related to the project are indispensable. Supporting disciplines such as computer science and decision science may also play an important role. In fact, modern management practices and various special knowledge domains have absorbed various techniques or tools which were once identified only with the supporting disciplines. For example, computer-based information systems such as project management software and decision support systems are now common-place tools for general management. Similarly, many operations research techniques such as linear programming and network analysis are now widely used in many knowledge or application domains.

To understand further, let us first differentiate the difference between a project manager and a construction general manager.

Project Manager vs General Manager in Construction

When beginning a construction project, one of the very first questions that come up in the mind of the client is: “who should I hire to run my project?” With this inquiry comes many confusing possibilities, and eventually, the question becomes not who is to be hired but rather what is to be hired.

In general, there are three common consultants which run a construction project: Project Managers (PM), Construction Managers or the general manager (CM), and General Contractors (GC). The differences between these job descriptions are distinct, but they are often and easily confused. Each consultant comes with a different perspective and it is important to identify which is best for each project.

I – Project Manager

The project manager is involved in all aspects of the real estate project, including pre-construction activities, construction administration, and post-construction. The Project Manager understands the client’s goals and priorities and ensures that all project consultants are in line with these goals. He also manages the human resources according to the target capacity, budget, time frame, and quality of the project.

Project managers are mostly on-site throughout the project, but in contrast to a general contractor or the construction general manager, they oversee the entire project from pre-construction to close-out, not just construction. A project manager typically manages the Construction general manager and/or the general contractor on behalf of the client. Essentially, the project manager becomes an extension of the client’s internal team and is able to guide all consultants in accordance with the client’s goals.

II – Construction General Managers

Construction general managers are hired before construction begins and are heavily involved during pre-construction. They also work with the design architect. He is involved in setting the budget and schedule of the project. Construction Managers work with onsite managers who handle the projects during construction.

The value of a Construction General Manager is advising the project owners and leading the team of construction workers, including the general contractor. Construction managers are responsible for setting and keeping schedules, monitoring finances, and making certain that all contractors are doing what they should every day.

To summarize, a construction manager and project manager serve as organizers and leaders of an assigned initiative. A construction manager has a more defined role, who works specifically on a construction project. A project manager is an expert leader, who can work in a variety of industries. As a generalist, a project manager completes administrative duties, such as organizing meetings, completing paperwork, and broadly completing a short-term project that’s tailored to the goals of a specific client or business. Meanwhile, the construction manager follows an established set of blueprints and oversees sub-contractors and the overall construction process involved in completing a building project.

Construction General Manager and His Roles

Without repeating some of the previous points, let us list out some reasons why a general manager might be a great option for construction firms.

  •         Company is simply growing beyond one leader’s capabilities and/or time allowance.
  •         Contractor is expanding into new geographical markets and having an on-site leader, totally dedicated to that market would benefit the company leaders and support the growth.
  •         Construction owner buys out another contractor and wants to set that owner up as a general manager for one to two years, giving the company a chance to learn the new market.
  • The Contractor needs a “buffer” between his level and that of the other staff.
  •         “Too many relatives” employed and the owner realizes that what is needed is an independent and non-family leader to run the show.
  •         Contractor is upgrading systems, computers, management tools like project management software, etc. and needs an expert to oversee such efforts.
  • The Contractor is diversifying the business and wants independent “Profit & Loss” divisions led by a dedicated general manager.
  •         Again, the contractor has children still three to five years from leading the company so the general manager role becomes a bridge between the now and the future.

As you can see, there are a host of reasons why the general manager role should be seriously considered in a construction firm’s stakeholders.

Now, let’s consider what skills might be needed by a general manager. Remember, some skills might be more slanted to one area or another depending on the reason the position is needed. But for our purposes here, I think we’ll hit many of the needed skills.

The skills of an effective general manager in construction should include:

  1. Communication skills — First and foremost the general manager must have communication skills to be able to converse with a wide variety of individuals. These days, it’s already easier to ensure communication skills are optimal, thanks to project management software like Pro Crew Schedule that makes communication consistent.
  2. Team skills — It is the general manager that must work at bringing different parties together to have them working effectively.
  3. Systems skills — The more the general manager understands systems and process management the quicker she will be to truly have a positive impact on the business or some portion of the business.
  4. Public relations skills — Meeting customers, satisfying architects, and engineers, etc., are just a few of the types of people whom the general manager will need to work his magic. Since the general manager fully represents the contractor’s business, it is extremely important that he understand how to “schmooze and mingle” with others.
  5. Financial skills — The general manager will have to be able to read, understand and produce important financial documents for your business.
  6. Safety and quality skills — Yes! The general manager needs to be a loud voice for safety and drive every ounce of quality thinking and execution possible. With all of the support today for safety and “lean construction,” these skill areas should be no obstacle to finding a good general manager.
  7. Decision making/problem-solving skills — Certainly there is a difference between making decisions and problem solving, but for our purpose, we’ll consider them very close cousins. The general manager role must possess the person who can “pull the trigger” on a daily basis. Prudence, wisdom and effective use of problem-solving tools and techniques should be incorporated, but in the end, the general manager must solve problems and make decisions!
  8. Presentation and facilitation skills — Like communication skills, this skill area lands on several leader’s requirement lists. The general manager will be expected to provide regular updates to their owner or senior leaders so possessing the skills needed to present their information will be necessary.

Final Words

We’ve had contractors over the years tell us that their general manager can just about run the company, without them. Well, to a degree, that’s the idea for most general manager roles. With them, business owners or senior leaders who must deal with banks, spend more time on business development, etc., then the general manager might come pretty darn close to running the show. However, at the very least, the general manager should be clearly directing traffic on a daily basis.

That, in a nutshell, is why general managers are needed and some of the skills they need to have.

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