Large variations in the resource loading across a project’s duration impact cash flow and field productivity.
Labor intensive contractors are impacted the worst because there is zero cash flow float on labor costs. Labor is paid within days of being incurred without any ability to stretch the payments out at all.
The best schedule you can have for cash flow is one that ramps up smoothly, holds at peak production for a period of time, and then ramps down smoothly. The closer you can get to this schedule flow on your projects, the smoother they will run.
Schedule management starts with making clear production assumptions during the bid process and where applicable, getting those integrated into your contract.
From there, focus on planning your project and keeping a level schedule flow in mind.
Plan your Schedule-of-Values (SOV) for maximum cash flow based on the project schedule.
Leverage your relationships to negotiate the best schedule flow and SOV you can.
We are revamping our publicly available cash flow workshop that includes these 18 tactics that contractors can use to accelerate cash flow. Stay informed of updates on release.
