Project Management: Projects on Hold During the COVID-19 Pandemic

  • 21 April, 2020

During these uncertain times, it is important to make sure that you clearly communicate with your clients. This is especially true when the client puts a project on hold. There are several assumptions the client could be making when they put a project on hold, and it can be critical to your firm's operations that the client has all the facts.

This is especially true when it comes to accounts receivable. The client may be assuming that since the project was put on hold, they won't be seeing any invoices until the project restarts. That is most likely an incorrect assumption, and something you'll want to proactively correct. Most firms issue invoices every 30 days and allow the client another 30 days to pay without accruing interest for late payment. This means that at the time a client puts a project on hold, they could be just about to get one of two invoices. This compounds if the client is on a longer payment cycle such as 60 days. The best approach to take is at the time the client puts the project on hold, coordinate with your accounting team, and make sure to inform the client of how many invoices they can expect, (and provide an approximate amount). Taking this step will eliminate any confusion about invoices during the project hold.

In addition, it is a good practice to inform your client that there will be additional efforts involved in properly putting the project on hold for a while. The original scope of the project likely assumed a progressive flow to developing the design and construction documents, and stopping the project suddenly was not anticipated. You should encourage the client to consider that it will take some effort to wrap up elements of the project that are in midstream and to close it down in a way that facilitates a smoother project restart. These efforts and the related fees are normally outside the scope of work identified in the contract, and the architect is entitled to be compensated for them. Having this discussion at the time the project is put on hold will have better results for all involved.

Project Management: Projects on Hold During the COVID-19 Pandemic

Another subject to discuss with the client is what to expect at project restart. Architectural projects are very complex, and it's not practical to expect that a project can be simply activated without some challenges. For one, there is the issue of staff availability. Can you get the same staff on your team that you had when the project was put on hold? Will you have to bring new team members up to speed? What about the project schedule? When states relax the stay-at-home orders and people begin to return to work, will there be new conditions in the workplace that present challenges to staffing your project? You might not know the answers to these questions now, but it's best to have an open dialog with the client as the project is being put on hold to addresses the possible challenges to project restart, most of which will likely impact the schedule.

In the end, best practices related to project management require a strong emphasis on clear communication with your client, especially in these uncertain times. Doing so could greatly improve your firm's ability to resume normal operations and to thrive in the future.

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