1. Ideas for today and tomorrow
Deliver Real Estate
Projects on Time:
Save the Industry
Transformation of a company is led from TOP. Therefore, the
first step is to have the TOP convinced for a change.
Vijay Pandey
vk100pandey@gmail.com

2. • Engineering –IIT Kanpur, Management – IIM Kolkata, PMP – PMI/ USA
• Design, Engineering, Construction of large projects in Steel Industry, Oil
& Gas Industry, IT Industry and Real Estate Industry
• Rs 800 cr worth of projects in Steel Industry, Rs 3600 cr worth of projects
in Oil & Gas, USD 700 million worth of work in IT industry, and Rs 2200
cr worth of work in Real Estate.
• Worked Across 17 Countries in the World. Well travelled and managed
multi-lingual, multi-cultural people.
• Managed design, projects, global business and P&L
• Based in Bangalore
About me

6. Real Estate Regulatory Act
• No pre-launch without all
approvals in place
• Escrow account for projects –
50% to be locked
• Pay penalty for Delays at the
same rate (@PLR + 2% = 11.2%)
• Carpet area as the base for sale
Real Estate Industry under Multiple Challenges

7. What's happening?
2005 2010 2015
1000
2000
3000
4000
Cost
Price
Salary/
Affordability
Not
buying
Buying
5000
• Enquiries have not come down.
• Transactions have come down.
• Low ticket options are still selling.

8. What's happening?
2005 2010 2015
1000
2000
3000
Land
(20%)
Const.
OH
(10%)
Land
(25%)
Const.
OH
(30%)
Land
(30%)
Const.
OH
(40%)
4000
• Much larger projects/
longer duration
• Empire building (OH)
• No change in
construction technology.
• Construction cost
shoots up (input
prices)
• Land prices shoot up
• OH shoots up
• Debt shoots up
• Debt ridden
companies
struggling
• Retail Sales
dropped
• RERA brings
additional risks
• Revenue drops
• Profit drops
• Cashflow drops
• Distress sale
started (30%
discounts)
Only two options to rebound:
1. Innovation in sale methodology
2. Innovation in construction technology to reduce cost
by 40-50%, OH by >50%

9. The Time & Cost Equation
Total Project Cost = PrePojectCost (NOCs, Arch, Engg) + Material Cost * (1+ δ T * IR) + Labour Cost *(1+
δ T)+ Finance Cost * (1+ δ T*I) + SOH * (1+ δ T) + COH * (1+ δ T) + Penalty * δ T
= PrePojectCost (NOCs, Arch, Engg) + Material Cost + Labour Cost + Finance Cost + SOH + COH
+ δ T* (Material Cost *IR + Labour Cost + Finance Cost *I + SOH + COH + Penalty)
= 1.45 * Construction Cost + Construction Cost * (0.83*0.10 + 0.21*0.15 + 0.08 + 0.40 + 0.11) * δ T
= 1.45 * Construction Cost + Construction Cost * (0.083 + 0.03 + 0.08 + 0.40 + 0.11) * δ T
= Construction Cost * (1.45 + 0.7 * δ T)
Delay in Project (for a 3 year project) % Cost Increase
1 year delay in completion 16%
1.5 year delay in completion 24%
2 year delay in completion 34%
3 year delay in completion 49%
Industry Benchmarks
Total Project Cost = 1.45 *
Construction Cost
EBIDTA Margins = 30%

10. How to Get Projects Delivered on Time?
1. Drawings
2. WO
3. Material
4. Equipment
5. Labor
6. Payments
7. Work Front
8. Project Clearance
(NOCs)
1. Strikes/ Bunds
2. Rains
3. Accidents
4. Seasonal
Holidays
a) October
b) March
5. Eqpt downtime
6. Procurement
Lead times
7. Material approval
lead time by
architect
Inputs Provision for
Uncontrolled Delays
1. 3 Months
Rolling Plan
2. Monthly/
Weekly Progress
Review at Site
3. Project Review
by Management
Process to Put in Place

11. The Mechanism – To Get Inputs on Time
Project Plan Monthly
Review at
Site by PM
Monthly Project
Review by
Management
Inputs PM’s Impact Management
Impact
Drawings 30% +10% 40% +55% 95%
WO 30% +10% 40% +55% 95%
Material 30% +30% 60% +35% 95%
Equipment 30% +60% 90% +5% 95%
Labor 30% +40% 70% +25% 95%
Payments 30% +0% 30% +650% 90%
Work Front 60% +20% 80% +15% 95%
Project Clearance
(NOCs)
100% +0% 100% +0% 100%
0.044% 1.45% 66.15%

12. The Mechanism – To Get Inputs on Time
Project Plan Monthly
Review at
Site by PM
Monthly Project
Review by
Management
Review Cycle PM’s Impact Management
Impact
1st Month Review 0.044% 1.45% 66.15%
2nd Month Review 66.15% 75% 85%
3rd Month Review 85% 95% 99%
As we can see from the above, we live in a probabilistic world and the probability
increases with each cycle of review. The numbers may vary from organization to
organization, but for real estate companies in India, the trend will normally be
similar.
A three month rolling plan almost ensures that the targets are reach month on month.
A PRM is the real booster and needs to be instituted in the company.

13. Inter-relation between PMI and & PRM (For
Real Estate Companies)
Project Manager Level Reviews
PM Knowledge Areas
(Initiation, Planning, Execution, Control, &
Closeout)
Management Level Reviews (PRM)
(Land, Legal, NOCs, Architecture, Engineering, Marketing,
Sales, Purchase, Contracts, CRM, Finance, Accounts, Municipal
Authorities, Labor Authorities, Other Govt. Agencies)
The influence area of a Project
Manager is inside the
boundary of the project.
However, real estate projects
have lot of external influences
for which PM does not possess
necessary skills and is
dependent on other
specialized departments.
The executive management
(CEO) alone has control over
all these departments and this
review facilitates resolution of
issues and supply of inputs to
PM for successful execution of
projects.

14. Development Manager vs Project Manager
• As the Company grows up with several verticals (e.g. DLF), the business vertical head
conducts the PRM for his vertical.
• Also, as the number of projects and the sizes grow up, PRM too is not able to give the
desired attention at times for each project
• Hence, emergence of the role Development Manager (DM) or Development Director.
• DM becomes the P&L owner of the project and ensures that the Project Manager is
provided with all the support and escalations outside his project boundary.
• DM, however still does not replace the role of PRM. PRM still needs to be conducted.

15. Ingredients of a PRM
• Conducted once a month at the Head Office
• All projects to provide a PRM report – Brief, max 7 to 8 page report
• Plan vs Progress, Progress Pictures
• Planned Completion vs Forecasted Completion,
• Planned Cost (Budget) vs Forecasted Cost of Completion,
• Project Inventory,
• Project Manpower,
• Project Risks
• Audience – All department heads, all PMs, all DMs, CEO/ COO/ CFO
• Each PM can present his report, or a person in role of Ops Head
• All action items to be recorded with action-by and action-date
• Weekly follow up of action items till closure

16. Conclusion
• Project completion delays are the single biggest business risk to real estate companies
today, next to sales slowdown.
• About a year & half delay can erode the entire project margin, and if buyers need to be
paid penalty on top of it, it becomes a loss making proposition.
• Hence, completion of real estate construction projects on time is the single most focus
today.
• There is need to bring in trained PMs, 3 month rolling plans, and PRM in practice.

17. Case Study (Simulation)
with Real Project
Management & Team

18. Planning Simulation
J F M A M J J A S O N D J F M A M J J A S O N D
Sl Activity
Durati
on
Duration
(Days)
Start End 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
1 Excavation 3 90 1-Jan-15 1-Apr-15 0.7 0.7 0.7
2 RCC Sub structure 4 120 15-Feb-15 15-Jun-15 2.1 2.1 2.1 2.1
3 Commencement Cert. 2 60 16-May-15 15-Jul-15
4 RCC Super Structure 8 240 26-Apr-15 22-Dec-15 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5 2.5
5 Masonry 6 180 25-Jun-15 22-Dec-15 0.5 0.5 0.5 0.5 0.5 0.5 0.5
6 Internal Plastering 6 180 24-Aug-15 20-Feb-16 0.7 0.7 0.7 0.7 0.7 0.7
7 External Plastering 3.3 100 21-Mar-16 29-Jun-16 0.5 0.5 0.5 0.5
8 Dadoing & Flooring 6 180 22-Nov-15 20-May-16 1.4 1.4 1.4 1.4 1.4 1.4 1.4
9 Doors 3.3 100 22-Nov-15 1-Mar-16 0.8 0.8 0.8 0.8 0.8
10 Windows 3.3 100 22-Dec-15 31-Mar-16 0.6 0.6 0.6 0.6
11 Internal Painting 5 150 23-Oct-15 21-Mar-16 0.3 0.3 0.3 0.3 0.3
12 External Painting 3.3 100 20-May-16 28-Aug-16 0.3 0.3 0.3 0.3
13 Lifts 4 120 22-Dec-15 20-Apr-16 0.4 0.4 0.4 0.4 0.4
14 Sanitary Fixtures 3 90 21-Jan-16 20-Apr-16 0.4 0.4 0.4 0.4
15 Plumbing & Sanitary 3 90 25-Jul-15 23-Oct-15 0.6 0.6 0.6 0.6
16 Electrical Internal 3 90 25-Jul-15 23-Oct-15 0.7 0.7 0.7 0.7
17 Electrical External work 3 90 23-Oct-15 21-Jan-16 1.0 1.0 1.0 1.0
18 Fire Protection 3 90 21-Jan-16 20-Apr-16 0.7 0.7 0.7 0.7
19 Misc. (STP, Strl & 3 90 20-May-16 18-Aug-16 1.9 1.9 1.9 1.9
20 Amenities & External 6 180 22-Dec-15 19-Jun-16 0.5 0.5 0.5 0.5 0.5 0.5 0.5
21 Occupancy Cert. 3 90 20-Apr-16 19-Jul-16
22 Hand Over to CRM 4 120 19-Jul-16 16-Nov-16
Total Project Duration 685 0.7 0.7 2.8 4.6 4.6 4.6 3.1 4.3 5.0 5.0 7.5 7.1 6.2 5.7 5.5 5.4 5.6 4.2 3.2 2.2 - - - -
0.7 1 4 9 13 18 21 25 30 35 43 50 56 62 67 73 78 83 86 88 88 88 88 88
Scoring Criteria
133
133
550
921
921
921
613
868
1,005
1,005
1,498
1,423
1,242
1,134
1,091
1,081
1,119
844
646
438
-
-
-
-

19. Constraints – SLAs, Escalations, Lead Time
SLA-1 SLA-2
PIC & his team Make Project (Execution) Plan
a. Site Logistics 1 month
b. Detailed Activity Plan 1 month
c. Procurement Plan 1 month
d. Work Order Plan 1 month
e. Labour Deployment Plan 1 month
f. Equipment Deployment Plan 1 month
g. Project Staff Deployment
plan & org Structure
1 month
f. Cash burn plan 1 month
g. Quality Assurance Plan 1 month
Daily/ Weekly/Monthly Plan
Daily/ Weekly Progress Review
Catch Up plan
Reporting to Tech Head & PRM
Stores/ Inventory Management
Technical BOQ 3 months
Estimate 3 months
Budget 6 months
Approval of Purchase Requisition 1 week
Approval of Work Orders 2 weeks
Project Phasing & Milestones 3 months
Project Specification 3 months
P&C Team Conduct Review Meetings Done
Send Reminders/ Follow up on
actions
Done
QA/ QC QA/ QC as per QAP 100%
QA/ QC without QAP 80% 20%
Architecture Architecture Drawings 1 month
Area Statement 3 months 6 months
GFC Drawings (Structural,
Plumbing, Electrical etc.)
6 months 9 months
Finalise material specs to be used
- tiles
- doors
- windows
- paint
- club house
- interiors
- amenities
1 months 2 months
Procurement Purchase Orders 1 week
Test Certificates 2 months
Replacement for stolen /
damaged/ expired materials
1 months 3 months
Purchase Cement, Steel, Tiles 3 weeks
Purchase Doors & Windows 2 months 6 months
Purchase other materials 2 weeks
Contracts Tender Preparation & Floating 3 months
Issue Work Order (large contracts) 3 month
Issue Work Order (other contracts) 2 months
Issue Change Work Orders
(Amendments)
2 months
WO for Doors & Windows 3 months
WO for lift 3 months
Other Work Orders 2 months
Billing/ Finance/
Accounts
Approval of Vendor Invoices 2 weeks
Release Payment 1 week 1 month
Human Capital Recruitment of Staff 3 months 6 months
Legal/ Land Handling legal issues on the
project
3 months 6 months
Handling legal issues on land 6 months 2 yrs
Sort out boundary issues 6 months
Sort out Kharab land issues 6 months
Liaisoning Get CC 3 months
Get OC 6 months
Get Fire NOC 3 months 6 months
Get Electricity 3 months 6 months
Get Water Supply 3 months 6 months
Main Contractor Supply Labour 1 months
Supply material (his scope) 50% 75%
Execute Work 50% 75%
Landscape
Contractor
Landscaping Drgs 3 months 6 months
Swimming Pool Drgs 3 months 6 months
Landscaping 3 months 6 months
Swimming Pool 3 months 6 months
Club house 3 months 6 months
Management Escalations (max 2 in a month) Reduce time by 30%
Note: Projects which provide GFC drawing requirement plan will get drawings
one month in advance.
Note: Contract timelines will be less by one month for projects which provide
work order plan for the entire project in the beginning itself
Note: Recruitment timelines will be less by one month for projects which
provide recruitment plan in the beginning of project
Note: All procurments can be made in one week time if a procurement plan is
given in the beginning for the entire project.
Note: Entire invoice amount will be paid if cash burn projection given for entire
project in the beginning itself.

20. Four Project Teams – Given Same Project
0.7 1.3
4.1
8.7
13.3
17.9
21.0
25.3
30.3
35.4
42.9
50.0
-
10.0
20.0
30.0
40.0
50.0
60.0
1 2 3 4 5 6 7 8 9 10 11 12
Cumu A Cumu B Cumu C Cumu D Plan 1. As is typical of the industry,
all the four teams fell behind
the planned completion date.
2. All four are on different
progress curve based on the
experience of the PM.
3. There is no uniformity in
approach.

21. Added Surprise Elements (new unexpected
constraints)
Sl No Issue Month No Duration Impact
1 Legal notice - stop work 3 1month No work at site.
2
Errorin boundary line;
retaining wall to be
modified.
6 1month
5% of substructure additional cost to be
spent.
3 Sand Strike 7 2weeks
Work will not progress if stock not
available.
4 Holiday Month 10 1month
Labour-halved;
to rebuild the labourforce
5
Quality Issues in Projects
which did not have QAP
12 1month
20% of the work found having defects
and need to be rectified. Progress
reduced to 80%. Remaining 20% to be
rectified.
1. The projects were
repeated second time.
2. Some new, surprise
constraints were
added.
3. However, training was
given on how to use a 3
month rolling plan.

22. Four teams – Second attempt
1. Despite additional
surprise constraints, all
the teams performed
better than the plan.
2. All four teams crossed
the planned curve at
the same time.
3. There is uniformity in
approach, and all the
four progress lines
almost converge on top
of each other.

23. Monthly Progress – first & second attempts

24. Project Execution JNAN
PLANNING
a Make a complete execution plan - Work orders, Labour, Material, Equipment, GFC Drawings
b Quality Assurance Plan is part of the planning though it needs input from Quality team
c Plan for the entire project monthwise
d Ensure material and labour are kept in synch all through
e Focus for long term - 3 to 6 months look ahead during execution
EXECUTION
a Target for doing more than planned - at least 15% to 20% more (if possible)
b It is the cumulative target which is more important than the month target
c Focus on getting Work Orders Issued as much in advance as you can
d Get GFC drawings in advance as much as you can
e Use Management Escalation - as a process (not as complaint)
Meeting the Project Timeline (Schedule)
a Cannot achieve target without having cushions in planned time
b That means, Increase productivity per month; stay ahead of schedule by 15% roughly.

25. Thank You