How Construction Management Differs From General Contracting

At first look, construction management work sounds a lot like general contracting. In both cases, you will put a small firm at the top of a project so they can direct the action.

Construction management services firms differ in several key ways from general contractors, though. Here are four of the biggest differences and why they matter to customers.

Little to No Labor Involvement

Typically, a GC will bring at least some general laborers from its payroll to handle basic work. Conversely, construction managers have little to no involvement with the labor at a site. The construction management approach is about bringing together ideas, coordinating people, and directing jobs. While both a GC and a construction management services provider will subcontract tasks, the management model depends on it.

Incentives

A GC will usually bid on a project, but a CM is more likely to be contracted for a specified rate without bidding. Consequently, the incentives for the two are quite different. A general contractor has a strong incentive to keep costs down or else they won't turn a profit. CMs are unplugged from the profit motive, and they may be more desirable on projects where build quality is a priority ahead of strict cost control.

Similarly, a construction manager will tend to be more adaptable to the circumstances. A GC may have to renegotiate or take a loss on a job if economic conditions change suddenly. A CM can usually adjust better because they have the freedom within the project to do so.

More Focused

As the name implies, folks in construction management do nothing but building work. Many GCs, on the other hand, deal with tasks that are similar to construction, especially remodeling and roofing, but aren't perfectly the same. When you hire a CM, you can assume their professional focus is putting up new structures.

Timing of Involvement

People usually hire GCs just before they're ready to move ahead with projects. A construction management services company is typically involved from the start or early on. The management firm will provide input regarding the larger engineering of the project, while a GC mostly does whatever the contract says to do.

If you're looking at a situation that may require significant adjustments during the early stages, there's a strong argument for hiring a construction management firm. They can work with architects, designers, and customers to sort out potential engineering and budget challenges long before shovels go in the ground.

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