The project owners have made excellent progress in planning, risk management and execution in recent years but challenges still remain, said regional industry experts.

As construction projects continue to evolve, and grow larger and more complex, more nad more organizations have gained more confidence in their ability to hit schedule, budget and quality targets, stated KPMG in its survey.

More than 100 private and public organizations within the construction sector around the world took part in the Global Construction Project Owners’s Survey 2015.

“It’s clear that there have been significant developments across the industry however, the survey also highlighted areas where owners are still striving to improve, namely - talent management, project management, project scheduling and contingency planning,” stated James Stewart, the global head of infrastructure at KPMG.

Stewart was in Bahrain recently to meet a number of KPMG’s key clients, discussing industry trends and best practice and advising on a number of the firm’s high profile engagements.

In the survey, over half of all global respondents said they had suffered one or more underperforming projects in the previous financial year.

For larger organizations, this rose to 61 per cent, while executives from the energy and natural resources and public sectors experienced even higher levels of project failure, at 71 per cent and 90 per cent respectively, it added.

Looking back over the past three years, fewer than one-third of all respondents’ projects managed to come within 10 per cent of the planned budget, with the energy and natural resources, and especially the public sector, performing considerably worse than other industries. And, in the same time period, just a quarter of construction projects came within 10 percent of their original deadlines; only one in ten public sector organizations managed to hit this target, said the report.

Mihir Shah, the director and head of Infrastructure Advisory at KPMG in Bahrain, believes that the survey findings have very strong correlation with the construction industry in the kingdom and the region at large.

"Thanks to large capital spend, improving technology and exposure to international best practice through tie-ups with international contractors, overall maturity of the construction sector in Bahrain has improved over time," remarked Shah.

Whilst larger players have naturally moved positively on the maturity curve, smaller, local firms also have huge potential, he added.

Shah said the step change in quality of project planning and management from local firms was visible and increasingly, "contractors are coming to us, looking for help to develop skills in project planning and risk, cost and project management."

Sophisticated improvements to planning and operations are no longer limited to the construction giants and the impact at a local level is clear.”

However, while the local construction sector is benefiting from the large spend, it is also facing challenges as it attempts to climb the maturity curve.

"Maturity in ongoing risk and project management; for contingency management to cope with the inevitable setbacks that accompany major construction projects; and to build positive and effective working relationships between project owners and contractors are some of the areas where the sector has potential to progress," explained Shah.

With millions – sometimes billions – of dollars on the line, global reputation at risk and economic growth in the balance, construction sector needs to take a more strategic approach to planning and delivery. By doing so, the sector can greatly enhance the potential for project success.

"With tens of thousands of activities to manage, too many project teams get bogged down in intense detail at earlier stages, rather than viewing activities at a summary level," remarked Stewart.

"And most scheduling is far too optimistic, based upon tight estimates with little leeway for delays. It’s little surprise that, as this survey shows, only a small proportion of projects meet their delivery and cost goals," he noted.

"We prefer to apply logic built upon knowledge and experience of what actually happens during the construction life cycle – and what can go wrong. Project owners and contractors also need to be able to link the cash flow with the work flow, to evaluate the financial impact of any delays," he added.-TradeArabia News Service