Importance of Initial Project Assessment and Identifying Red Flags

We have all been there: it’s late at night, and you ought to be asleep, but instead, you’re lying in bed, tossing and turning trying not to think about that project that has gone totally sideways. Frankly, I actually don’t mind lying in bed dreaming about the design of a project, but when things go wrong: when your client becomes Christian Bale from American Psycho, you regret the day you two met. Your dream project has become a true horror story and to avoid this, you want to do an initial project assessment. 

Early in my career, when I was eager to take on as much work as possible, I became an expert at taking on the wrong projects and agreeing to work for the wrong clients. This is why I always stress firms must never diverge from their Mission and Vision statements. These few sentences are more than just words. They are the foundation of every successful firm.

Your Mission statement set forth what your company does, how it does it, and most importantly, why. It ensures that your firm’s goals are aligned with the principles upon which it was founded. 

Your Vision statement describes the future-facing goals and ambitions of your company while reflecting your core values. It should serve as a mantra that inspires your employees to work toward the greater goal of your organization.

When you take on projects that don’t align with these two statements or work with clients that don’t share your values, you create cracks in the foundation that have strong potential to destroy your dreams (if you could ever get back to sleep). The effort you will spend to repair the foundation is not only hugely expensive, it takes you off the path that you had been working so hard to build.

True story. My firm was three years old when a prospect called and asked if I was interested in creating a feasibility study for a huge parcel of land in Chicago. My partner and I, and our little team of 9 architects had been building a successful business working on high-end, single-family residential projects. We were financially solid and all of our processes and systems were geared toward designing and building single-family residential projects and working with clients that understood our value and respected our values. We had no intention of taking on projects of this scope.

Against my partner’s advice, I couldn’t resist the offer. Before opening my firm, I spent 7 years with SOM and had extensive experience designing large, complex projects. Taking on this opportunity was like a trip down memory lane for me. I invited the prospect to come to our office for a meeting. The moment he walked in the door, my spider senses were tingling. I knew something was not right. We talked about his development company and how he came to this particular project. Red flags were flashing like strobe lights but part of me was deluded into ignoring all the warning signals.

I will stop here and give a summary. We were supposed to be paid $35,000 for a three-week feasibility study and asked for half the payment in advance.  We did all the work including preparing twelve bound books. Despite creating a project that made the client very happy, we didn't receive any payment for our work. $0!

Had I taken the time to properly assess the project and identify the risks involved, I could have developed strategies to mitigate them if things went south. But I didn't, and things went very wrong. This story has a bitter-sweet ending. Working with the Illinois State’s Attorney Office we were able to squeeze one-third of our fees from the client and got the perverse pleasure of seeing him go to prison for 15 months. This is not why we went into business. My bad decision forced our firm to suffer financially and took my attention away from the path we really wanted to travel. While this wasn’t the last time we had problems, it was the last time we ever took on work that did not fit with our mission and vision statements.

When I say that an ounce of prevention is worth a pound of cure, believe me, I speak from experience. Don't make the same mistake I did. Take the time to assess your projects thoroughly and identify any potential red flags before diving in headfirst. Your future self (and your bank account) will thank you. 

In this blog, I’m going to help professionals in the A/E industry, like yourself, understand the importance of an initial project assessment and identifying red flags.  

By outlining strategies for identifying and addressing red flags, my goal is to equip you with the tools you need to avoid project failures and improve outcomes.  

I’ll cover a range of topics, including: 

• The consequences of ignoring red flags, 

• strategies for addressing red flags, 

• and tips for outlining effective project assessments. 

The advice I'm about to share will give you a better understanding of the importance of initial project assessment and help you develop the skills you need to be successful and profitable in your work.  

Let’s begin.  

Definition of Initial Project Assessment

Let's start with the basics: what exactly is an initial project assessment?  

So, initial project assessment is the process of evaluating a project's feasibility and determining whether it's worth pursuing. Also, whether the client is worth pursuing. Like story above, if you feel the client is not going to work well with you, it's not worth going down that path. 

Think of your initial project assessment like a job interview - you're trying to figure out if the project is a good fit for your team and if it aligns with your goals and capabilities.  

The initial project assessment process includes everything from conducting market research to assessing resource availability to identifying potential risks or challenges.

By taking the time to conduct a thorough assessment, you can identify potential issues early on and develop a plan to address them, ensuring that your project is set up for success. 

Process of Initial Project Assessment 

The process of initial project assessment involves several important steps. 

1. Reviewing project scope and requirements.

This is all about understanding the goals, objectives, and deliverables of the project. This is what you want to look at immediately Make sure that everyone is on the same page and that the project scope is clearly defined. If you don’t, you run into the dreaded scope creep, and your entire project is thrown off course resulting in upset clients and your firm running over budget.  

2. Identifying stakeholders

You’re going to see me bring this up multiple times. This involves identifying all stakeholders and understanding their needs and expectations to ensure that the project meets their requirements. You want to make sure that everyone's needs are taken into account so that the project can be successful. You don’t want to meet some exec after you’ve finished the project that you suddenly learn has a big say so in the expectations, only to find out he isn’t happy one bit with the outcome. He wanted something else entirely different. Know everyone involved from the beginning.

3. Analyzing the project budget 

Once you've got a handle on the scope and stakeholders, it's time to analyze the project budget and timeline. This involves taking a good hard look at the budget and timeline to make sure they're realistic and achievable.  

4. Conducting a risk assessment

This involves identifying potential risks and developing strategies to mitigate them. You want to make sure that you're prepared for any unexpected issues that may arise.  

Based on the findings of the initial project assessment, you must develop a project plan. This plan should outline: 

• The scope

• Timeline

• Budget

• Risks

• And include a detailed project schedule, resource plan, and communication plan. 

If you follow these key steps, you can set your project up for success and ensure that you're prepared for anything that comes your way. 

Identifying Red Flags

Now let's talk about the other very important part of this blog: identifying red flags.  I’m sure you know what a red flag is, we see them all the time in life and relationships, but what do they mean when it comes to your projects? 

Red flags are warning signs that indicate potential problems or issues that could affect the success of a project. Think of them as the little voice in your head that says, "Uh oh, this could be a problem." We’ve all heard that voice multiple times.  

Red flags can come in many forms - it could be an unexpected change in the project scope, a team member who isn't pulling their weight, or a budget that's spiraling out of control. 

Whatever the case may be, identifying red flags is key to keeping your project on track. 

Common Red Flags in Project Assessment 

Now let’s move on and talk about some of the most common red flags that can pop up in A/E projects.  

1. Unrealistic timelines

When a project has a timeline that's too short or unrealistic, there's no way around it- it's going to fail. Trying to rush into an unrealistic timeline will not only stress your team out but present a product that falls short of expectations.  

2. Inadequate budgets

Projects with insufficient budgets typically fail due to cost overruns or an inability to complete the project scope. It's important to ensure that your project budget is realistic and adequate for the scope of work. Your time is valuable. Your skills and talent are worth the budget you know you need for your project. 

3. Unclear project scope

When stakeholders have different ideas about the project scope, it can lead to misunderstandings and conflicts, which can cause delays and quality issues. It's important to ensure that the project scope is clearly defined and understood by all stakeholders. 

4. Insufficient communication

When communication between stakeholders is inadequate, it can lead to misunderstandings and cost overruns. You must establish clear lines of communication and ensure that all stakeholders are on the same page throughout the project. Communicating along the way will save you from clients accusing you of not being transparent. 

If a project fails due to red flags that were ignored, this can damage your hard-earned reputation and result in a loss of business. Clients may be hesitant to work with a firm that has a history of project failures or cost overruns. 

Strategies for Identifying Red Flags

So now that we’ve talked a little bit about what these red flags are, let’s unlock some strategies for identifying red flags in A/E projects. 

1. Engage in proactive risk management

This involves taking steps to identify potential risks early in the project and developing strategies to mitigate them. This can include conducting a risk assessment and developing a risk management plan. 

2. Establish clear communication channels

As I mentioned earlier, you absolutely must ensure all stakeholders are on the same page. This can help to identify potential issues or conflicts early on and develop strategies to address them. 

3. Conduct regular project reviews and status updates

Doing this helps to identify any red flags that may have arisen since the last review. Being consistent and thorough in your reviews and updates to the client and your team can help to catch potential issues before they become major problems.

4. Establish clear project goals, objectives, and deliverables 

Here I am, sounding repetitive, but be sure that all stakeholders are in agreement. Establishing project goals can help to prevent misunderstandings and conflicts that can lead to delays and cost overruns. 

5. Engage in continuous improvement

I started my first company in 1993 and throughout the years I still learned something new from every project and this was done through detailed monitoring. To continually improve and learn, you must monitor the project's progress, identify areas for improvement, and take steps to address them.  

By adopting these strategies, you can identify potential red flags early on and take steps to address them before they become major problems. 

Strategies for Addressing Red Flags

We talked about strategies for identifying red flags, so now why don’t I give you what you really want—strategies for addressing them.  

When it comes to addressing red flags, there are several strategies that you can use.  

1. Develop a contingency plan

Here's a quick example of putting together a contingency plan. So, let's say you’re planning to design a large office building for a client. As part of your initial project assessment, you identify several potential risks and red flags, including a tight timeline, some very complex design requirements you might not be able to fulfill, and the potential for budget overruns. Yikes. 

When you develop a contingency plan, this helps you prepare for these risks so you have a solution ready for each possible scenario.

For this example, you’d start by identifying specific actions you can take to mitigate each risk, such as: 

• If the timeline becomes too tight, you can prioritize certain design elements over others to ensure the project stays on schedule. 

• If the design requirements become too complex, you can break the project down into smaller, more manageable phases. 

• If you get too close to your budget, you can look for areas to reduce costs or negotiate with the client for additional funding if necessary. 

You then document these actions in the contingency plan and share it with all stakeholders, including the client. This way, everyone is aware of the potential risks and how you plan to address them. 

2. Adjust the project scope

By reviewing the project scope and making changes to ensure that it’s clearly defined and achievable, you can avoid misunderstandings and delays and even prevent going over budget. 

3. Revise the project budget and timeline

By reviewing the project budget and timeline and making changes to ensure that they’re realistic and achievable, you can avoid cost overruns and delays. Don’t feel like you have to agree with everything the client says. If you know that timeline is too short or the budget too small, let them know. It’s your project. 

4. Improve communication

Communication is key when it comes to addressing red flags. Insufficient communication between stakeholders is a common problem that leads to so many issues. By establishing regular communication channels and keeping all stakeholders informed of project progress, you can avoid misunderstandings and keep your clients happy. The easiest way to do this is with consistent reporting and check ins. 

5. Regular project monitoring

We all know that feeling of relief and satisfaction when a project is complete. However, the work isn't done just because the project is complete.

Now it's time to monitor.

Regular project monitoring is just as important as the initial project assessment. By monitoring projects regularly, you can identify potential red flags early on and take the necessary steps to address them.

You want to establish regular project checkpoints and review the progress against your project plan. This lets you adjust course if need be and keep the project on track.  

You don’t have to do a project assessment and identify risks in a manual and tedious way. You also don't have to do it alone. One tool I highly vouch for that can greatly assist with your project assessment and even ongoing project monitoring is BQE CORE. This software can help you establish regular checkpoints and track progress against the project plan.  

By providing real-time updates on project status, BQE CORE allows you to identify potential red flags and take action before they turn into serious issues. The software can also help with resource allocation and budget tracking, ensuring that the project stays on track and within budget. 

Closing Remarks on Initial Project Assessment

Most of us got into the A/E industry because we love to work on projects and share our passion with our clients. We want to see those same projects bring us in that hard-earned money. But if you take on every single project and client, without conducting an initial project assessment and identifying red flags, not only is this going to potentially lead to project failures, but it can also negatively impact your firm’s reputation. 

No matter how you go about managing your initial project assessment, it’s important you conduct one in the first place.  

As I said earlier, an ounce of prevention is worth a pound of cure. When your project stays on track and within budget and any risks are caught before they become major problems, you’ll be able to deliver a successful project that meets the needs of your clients and stakeholders.  

This not only improves your reputation in the industry but also increases the likelihood of repeat business and referrals. 

And with the help of project management software like BQE CORE, you can streamline your project monitoring process and make data-driven decisions that lead to successful project outcomes. 

So, take the time to assess your projects, identify potential red flags, and develop a plan to mitigate them. Your business and your clients will thank you for it.