18 May What’s the Real Cost of Poor Coordination……….

Introduction

Poor coordination in projects and teams doesn’t just slow things down — it’s a silent profit killer with far-reaching impacts. When examining the cost of poor building services coordination, we find that from missed deadlines to eroded trust, the costs are both visible and hidden, affecting budgets, morale, and program. Let’s break it down with insights grounded in industry evidence, including Australian and New Zealand perspectives on the cost of poor building services coordination.

Main Costs:

• Budget Overruns: A 2020 study by the Project Management Institute (PMI) found that poor coordination contributes to 37% of project failures globally, with cost overruns averaging 20-30%. In Australia, the 2016 CPA Australia report on infrastructure projects highlighted that ineffective coordination led to a 15% average cost increase in major public works.
• Delays: The New Zealand Infrastructure Commission (Te Waihanga) noted in 2021 that coordination failures in construction projects caused delays in 68% of surveyed initiatives, pushing timelines out by months and inflating costs.

Hidden Costs:

• Team Burnout: The cost of poor building services coordination includes increased rework and miscommunication, leading to stress. A 2023 Australian Institute of Management survey found that 62% of project managers reported burnout due to misaligned teams, reducing productivity and increasing turnover.
• Stakeholder Trust: Inconsistent updates and missed milestones erode confidence. A 2019 Auckland Council review of urban development projects cited poor coordination as a key factor in diminishing public and investor trust.
• Opportunity Loss: Resources tied up in fixing coordination issues can’t be allocated to innovation or new projects. PMI’s 2022 Pulse of the Profession report estimated that organisations lose $99 million for every $1 billion invested due to inefficiencies like poor coordination.

Program Impacts:

Quality Compromise: Rushed work to meet delayed timelines often sacrifices standards. The 2018 Australian Productivity Commission report on construction flagged that poor coordination led to defects in 25% of reviewed projects, further showing the cost of poor building services coordination.

• Reputation Damage: High-profile flops, like the delays in Sydney’s WestConnex project, show how coordination failures can tarnish an organisation’s credibility, as noted in a 2020 Infrastructure Australia analysis.

Proven Insights:

• PMI’s 2021 report stresses that organisations with strong coordination practices see 28% higher project success rates.
• McKinsey & Company (2022) found that companies investing in digital tools for coordination, like integrated project management platforms, reduced costs by up to 15% and improved delivery times by 20%.
• In New Zealand, Fletcher Construction’s adoption of collaborative frameworks on the Auckland City Rail Link project cut coordination-related delays by 30%, per a 2023 case study.

Poor coordination isn’t just a hiccup — it’s a costly cascade that undermines success. Investing in clear communication, robust tools, and collaborative culture isn’t optional; it’s essential. Actions to reduce the cost of poor building services coordination can lead to significant improvements across projects.
Contact Innovo for advice on structuing your MEP&F coordination for optimal results on your next project.