Case study: Specialty food grocer reduces construction cost overruns

A rapidly expanding specialty food grocer with locations across multiple states.

The situation

The client was experiencing significant challenges related to the rapid expansion of their retail locations. Construction projects consistently exceeded budget and fell behind schedule, leading to substantial financial impacts.

Company leadership also lacked visibility into the root causes of these delays and cost overruns, hindering their ability to implement appropriate corrective measures for smoother operations and financial stability.

The solution and results

Because the client had active construction projects in distress, the firm quickly conducted a comprehensive construction process assessment. This involved stakeholder interviews and document reviews to pinpoint key challenges and opportunities, revealing:

• A critical need for monthly reporting to keep leadership updated on project performance, budget compliance and timeline adherence
• Poor accounting practices; data was inconsistent and inaccurate among financial and operational accounting systems leaving stakeholders in the dark about project financials
• Policies and procedures that did not support construction project transparency or accountability
• Challenges in maintaining proper budget controls leading to cost overruns
• Inadequate staffing levels for projects; managers either lacked grocer experience or were assigned too many projects at once
• Lack of clear and consistent communication among all stakeholders due to lack of documentation regarding design changes and change orders

To address these challenges, the firm implemented several initiatives:

• Monthly performance reporting. Established a regular reporting system that provided leadership with critical insights for proactive decision-making and timely interventions
• Policy development. Developed new policies and procedures to enhance transparency and accountability, utilizing the RACI framework to define roles and responsibilities
• Change order reviews. Conducted thorough reviews to ensure that all modifications were documented and aligned with project goals
• Staffing and communication improvements. Advised on staffing considerations and helped facilitate communication by participating in cross-functional implementation team meetings, providing examples and resources of best practices, and assisting in meeting agenda development
• Ongoing implementation support. Provided tools and templates to help track and manage implementation goals, specific activities, milestones, and deliverables

As a result, the client experienced an immediate return on investment, including:

• Increased visibility. Gained timely visibility into project status, budget management and timeline progress of active construction projects
• Enhanced policies and procedures. Improved accountability and transparency
• Stronger budget controls. Achieved better financial oversight, significantly reducing cost overruns
• Strengthened contract language. Alignment of stakeholder expectations and responsibilities, and a streamlined change order process