As the world awaits vaccines, an analysis of pharmaceutical construction projects finds that delays average four months. The time for better planning processes has arrived!
Speed Can Backfire—and Increase Costs
Turner & Townsend’s analysis of 20 of the world’s pharmaceutical construction projects found that 70% finished over budget, with delays of four months typical. The analysis involved projects with budgeted at $100 million or more. As reported by Construction Dive:
Of the projects that exceeded their budgets…90% did so in the areas of process equipment; clean utilities; and mechanical, engineering and plumbing. Together, these phases of the work made up an average of 44% of the projects’ total cost and approximately 50% of their schedules.
During a time when getting drugs like the COVID-19 vaccine to market is critically important, Turner & Townsend suggested the best way forward is to engage in more thorough early planning on these projects and to develop and apply a system of industry benchmarks.
One common aspect of rushed planning revealed in the analysis is over-reliance on historical data. This can lead to making projections on outdated or incorrect numbers—which results in higher engineering costs. Experts also stress that changes made once the design well underway creates challenges for procurement teams which also contribute to delays and expenses.
Get Up To Date Financial Intel
As big and small contractors across the country juggle percolating project plans and bids, they can often benefit from better financial intel. That’s why leading national surety bond expert, Colonial Surety Company offers a unique Partnership Account®. Apply and pre-qualify for a surety-line of credit that can help you manage and grow your business.
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Contractors who pre-qualify for a surety line of credit, go on to upload a few more documents that help Colonial better understand their operation and underwrite the Partnership Account®.
Collaborate—and Think Ahead Too!
How can the kinds of delays experienced in big pharmaceutical construction be curtailed? The Turner & Townsend report advises:
Collaboration…is key to achieving better outcomes for these pharma projects as well as building correct estimates and validating them independently, conducting interactive planning sessions and utilizing proactive risk management.
Whatever projects are on the horizon for your contract business this spring (yes it is going to come), you can also take a note from baseball legend Yogi Berra : It gets late early out here.
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Founded in 1930, Colonial Surety Company is a leading direct seller and writer of surety bonds and insurance products across the USA. Colonial is rated “A Excellent” by A.M. Best Company and U.S. Treasury listed.