In today’s construction market, we see a clear shift: more and more clients are implementing projects using general construction contracting. Although there are still projects in Lithuania that are implemented in a farm-based manner or with the help of a project manager to coordinate individual contractors, both of these models are increasingly seen as riskier, more expensive in terms of time and requiring significantly greater client resources. We discuss what general contracting is and why it is becoming a rational choice with Almantas Čebanauskas, director of UAB “EIKA Construction”.
With more than two decades of experience, the EIKA Construction team offers not only general contracting services, but alsoDesign-build” (lit. design and construction), design and its management, installation of structures and outdoor engineering networks and infrastructure works. The company performs most of its work in the public sector – about 60-80 percent, and also constantly works with private customers and investors.
What helps you meet deadlines?
Among the recently implemented larger projects of EIKA Construction are the Vilnius Airport Departure Terminal, the Medical Science Center of the Faculty of Medicine of Vilnius University, and the construction of the Panevėžys Infectious Diseases Hospital, and the installation of the infrastructure of the Rūdninkai Military Polygon Phase I. By the way, the installation of the latter was planned for a 36-month period, but EIKA Construction managed to organize the work in such a way that the construction of Phase I is planned to be shortened by as much as 6 months.
“Recently, we have been completing most of the significant projects within the planned deadlines. Not only the general contracting method contributes greatly to this, but also the EIKA Construction team implementing it. Our strength is professional construction specialists from various fields, engineers, estimators, design management and project managers, construction organization and management. An equally important factor is the ability to overcome the greatest challenges, ensuring smooth communication between all participants: builders, designers, general contractor, so that we are all rowing in the same direction and achieving a common goal,” emphasizes A. Čebanauskas.
He points out that meeting deadlines is also helped by the fact that EIKA Construction performs some of the work on its own, for example, the installation of structures (masonry, reinforced concrete, and prefabricated structures), outdoor water supply and sewage networks, and some infrastructure installation work.
“This allows us to manage the risk if, for example, the selected partner or subcontractor does not start the planned work on time or is late in completing it. This way, we do not lose very valuable time during construction,” explains the manager of EIKA Construction.
Eight for
A. Čebanauskas points out at least 8 advantages that general contracting provides to the client and the construction company.
“One of the most important advantages of general contracting is the principle of a single responsible entity. This means that all the issues of responsibility for construction work, quality assurance, meeting deadlines and even eliminating defects during the warranty period lie on the shoulders of the general contractor,” emphasizes the director of EIKA Construction. “It is much simpler for the client – there is no need to figure out which of the subcontractors made a mistake or which is late. The client has one contact who assumes all legal and technical responsibility. In addition, the builder saves during construction because a smaller and less competent team is required. Similarly, during the operation period.”
It is also important for the client that when working with a reliable general contractor, the risk of conflicts is reduced. The construction process becomes more predictable, less dependent on the activities of individual links. This is very important for both the public sector and investors.
“In addition, before calculating projects, we always assess whether the implementation deadline specified in the contract is realistic. If, after discussions with the customer, the data based on our calculations does not change his opinion, we do not submit an offer. We have not signed several contracts due to unrealistic deadlines,” says the director of EIKA Construction. “We have monitored the implementation of these projects – none of them were completed on time – there were delays of 4-12 months. So, we do not share unrealistic promises.”
How experience saves 1-2 months
Construction and its management are very complex technological and managerial processes. Therefore, according to A. Čebanauskas, the second important factor of general contracting is that the client receives a strong team with diverse competencies.
“This is where the third advantage of general contracting comes from – such a team effectively organizes work in the shortest possible time. The general contractor often works according to a precisely planned project management methodology, has the experience and resources to synchronize all stages of work – from preparatory work to interior decoration. Often, companies, having won a project, are very happy, recruit a team and thus “burn” 1-2 months, which, as a rule, are not enough to complete the project on time,” warns A. Čebanauskas.
According to him, EIKA Construction, which won the project, is starting the necessary preparatory work even before signing the contract: it is negotiating the signing of contracts with designers, foundation contractors, and others whose work is being carried out first, in order to start it as soon as possible.
“Since we have decades of experience, this happens by assembling teams in parallel, and thus we “save” those 1-2 months at the very beginning,” the head of EIKA Construction shares his experience. “In addition, the likelihood of downtime is reduced, because all work is coordinated centrally, all processes are carried out consistently and on time, and work can be optimized, for example, some contractors start work while others complete previous stages. This is especially important in projects with tight deadlines, such as schools, hospitals, infrastructure facilities or real estate projects, the sales times of which are planned in advance.”
Guarantees budget clarity and cost control
According to A. Čebanauskas, the fourth and most important aspect of general contracting for the client is guaranteed budget clarity and cost control.
“Using a general contractor, the total cost of the project is known in advance, when a fixed price or guaranteed budget model has been agreed upon. It also avoids hidden costs that often arise in construction by a farm or project manager, when the client negotiates with many suppliers and contractors,” the director of EIKA Construction continues to list the advantages of general contracting that are relevant to the client. “For example, we manage project budgets using the Bauwise program, in which we manage financial flows, risks, and we can see the planned final result and the change from the original.”
He also emphasizes that the general contractor can negotiate more favorable prices for materials or work because he has greater purchasing leverage and long-term relationships with suppliers.
“Another advantage of general contracting is no less important for the construction client – quality control is obtained from one source. As a rule, the general contractor has its own quality assurance standards and practices, ensures that all subcontractors work in accordance with design solutions, construction technical regulations (STR) and other legal acts,” A. Čebanauskas lists the benefits. “The general contractor also carries out constant supervision of construction works – both at the technical and procedural level. Thus, the client receives a single guarantee that ensures the performance of warranty work during the warranty period.”
When working in a farm-out or with a project manager, situations often arise where different contractors follow different standards or technical interpretations, which causes problems and ultimately direct damage to quality and construction deadlines.
The benefits of technology and digital tools
The general contractor, as a rule, invests heavily in advanced technologies and digital tools to be able to prepare and implement competitive proposals. As a result, clients who are offered the most technologically advanced solutions win.
“For example, since the beginning of this year, all our projects have been managed through the Dalux system. For particularly large projects, one of the most important things is to manage a large flow of information both at the design stage and during construction. The integration of 3D models, their use at all stages of the project, document sharing, and clarity of communication between project participants are steps towards a good result,” the head of EIKA Construction shares the benefits of advanced technologies.
A. Čebanauskas details that the aforementioned Dalux program is a project data repository where IFC models, drawings, and other information are stored and exchanged, it records defects and indicates necessary corrections, and it is used for communication between project participants, coordination and assurance of materials, and work safety control.
“We have also been using Building Information Modeling (BIM) for five years.”. Building Information Modeling) helped manage 384,349 BIM elements in the construction of the Medical Science Center of the Faculty of Medicine of Vilnius University – so many were designed by designers, which had to be purchased, delivered and installed, – A. Čebanauskas shares the benefits of digitalization. – In addition, during BIM design, it includes calculation of quantity analyses, visualization and review of the building information modeling project, design and modeling, engineering calculations and analysis, structural analysis and design, lighting analysis, 3D coordination and intersection verification.
During construction, BIM serves as an electronic construction log, work safety control and for recording and correcting defects using the Dalux Field tool, tracking and managing changes to the model and drawings, recording work progress and creating inspection logs. And during operation, when BIM was used during construction, the customer does not lose the information accumulated during construction and design and can use it. By the way, post-warranty maintenance is carried out in the same Dalux system, where all project participants’ connections and contacts remain, so it is easy to ask questions, record defects and inform about solutions.
EIKA Construction also uses electronic construction management platforms such as MS Project, LetsBuild, etc., which allow real-time tracking of work progress, resolution of emerging problems, and communication between teams.
The customer saves time and resources
“When working with a general contractor, the client does not need to deal with issues of logistics, supply or work sequencing, coordinate dozens of contracts with different entities, or look for solutions when something gets stuck on the construction site,” the director of EIKA Construction shares the seventh benefit of a general contractor. “All of these issues are resolved by the general contractor, and the client can concentrate on strategic decisions, the purpose of the facility, marketing or shaping consumer needs.”
And finally, according to A. Čebanauskas, working with a single contractor reduces legal risk and the likelihood of disputes, because contractual liability is clearly defined, the risk that subcontractors will blame each other for defects or delays is reduced, and the customer has a single defendant in all matters, which is especially significant in legal disputes or during the warranty period.
“Why are all the above-mentioned advantages of general contracting particularly relevant today? In Lithuania, we increasingly hear about delayed or stalled construction projects – especially those that are implemented in an economic manner or without clear central coordination. Often, such projects are delayed for years, experience budget overruns, and the final result does not meet quality expectations,” shares the director of EIKA Construction. “And both private real estate project developers and public sector institutions, having switched to the general contracting model, notice significant changes: smoother progress, clearer responsibility, more efficient use of resources, better cooperation and lower stress levels.”
According to A. Čebanauskas, the general construction contracting method is not just a technical or legal solution. It is a comprehensive project implementation model that allows for achieving higher-quality, timely, and financially sound results.
“The construction market is becoming increasingly complex, so the rational solution is to choose partners who are able to take full responsibility, effectively manage processes, and guarantee results. General contracting is exactly that path,” states the director of EIKA Construction.