Last year, in 2019 around 42,726 housing projects and 33,906 real estate agents were registered under the 2016 Act and 20,000 plus disputes were resolved under the law. There were several reasons which prompted buyers for filing a RERA complaint. Here are some of the conditions under which made the buyers file complaints:
- Delay in Possession
- False Advertisement
- Advance Payment
- Improper Registration of a Project
- No details about the Project
- Structural Defects
- Ownership Transfer
Analysing the trends in increase of no of cases in the RERA over the years, it seems like the customers will not stop going to the courts. Anticipating this, the RERA courts have planned to grade real estate projects & companies, appoint CRISIL consultants, create single-window clearance frameworks, implement e-court modules and also create a panel of auditing firms to carry out forensic and financial audit of real estate projects & escrow accounts.
Earlier when there was no such Act to understand the customers concerns but cases were being filed in courts. Today, it is not only the customers who are going to court but also the contractors & suppliers. The problem is that Construction projects – whether residential or commercial often do not meet customer satisfaction requirements – both internal & external. Sub-contracting is one of the core elements in Construction Management since they deploy huge manpower. The Suppliers’ materials constitute more than 60% of the costs. I have personally seen that the organisations keep huge amount of buffer time in their project plans, yet they are unable to deliver the promises. Some organisations have adopted systems like resource planning, ISOs, design technology, digital communication systems, but still fail to satisfy the customers.
As a construction management consultant, I have been analysing the various factors responsible for delay in possession, structural defects, ownership transfer etc considered complaints under RERA as cited above. There are several reasons for it! I am going highlight today the topmost two – people & process.
First, there is a common understanding among construction professionals about projects, that it is “permanently temporary” in nature. Since the duration of construction projects considered short in some cases and medium or large in some, there is a lack of clear approach to how the people are to be hired and managed.
The people working on project delivery are mostly sub contracted which means around 80% of the work is done by the contractual staff. The rest 20% considered staff oversee the management at all levels of a project. Big organisations could develop systems to address their staffing issues but the “contractual” mindset about the whole work does not create the impetus for understanding people’s needs more than the basics. In some cases, even the basics are missing. Unless the needs of an employee – both contractual & internal staff are understood and met, it becomes very difficult to manage issues like low productivity, absenteeism, accountability etc.
Therefore, managing performance of all people is the most crucial element achieving project goals & customer satisfaction. Afterall, it is the people who design & drive processes towards business excellence.
Secondly, a lack of standards results into creating inefficiencies in the process. In such bungling systems like construction every interaction among people becomes a challenge where experience wins over something that is better for the employees, company and the final customer. In any construction organisation, most of the work that is required to be done is mostly defined by the project owner in the initial stages. Contracting firms like design, planning & execution works etc are undertaken after analysing the cost, regulations, outcomes etc. Though the construction work is not yet completely defined in industrial engineering terms but there is definitely a standard for everything like surveying, casting, finishing, so on – as to – how the work is to be done and in how much time! At least with the guiding agencies.
Therefore, though every project has a uniqueness element, most of the process must be standardised to make them repeatable by utilising optimum resources eg casting of a slab in a residential building. Every slab that is to be casted is a standard but the amount of materials consumed in each slab and people required to construct it varies to a great length. Inefficient processes cause defects, rework & thus delays. So, the RCC process should benchmarked internally first to deliver the best quality in standard time at the right cost. Similarly, each process can be standardised by using the best practices. Unless that happens, the output and outcomes to be achieved would remain a far-fetched dream.
The need of the hour is to manage people & process performance efficiently & effectively to achieve customer satisfaction – both internal & external.
Vedzen Consulting has been leading change management for organisations in construction industry for years now. We, as Lean Consultants, have been working hand in hand with organisations to save them from getting into such situations ie RERA rigmarole.
In Lean management philosophy, underutilising the people capabilities is classified as the 8th form of Waste. Lean advocates training & development of individuals in order to tap their potential beyond basics to improve products, services & processes. When an organisation becomes successful in eliminating process inefficiencies, satisfies its customers internally, ie its employees also contractors & suppliers, it can satisfy its customers – the buyers.
Lean Construction is a proven management strategy which challenges the conventional understanding and construction business practices. It focuses on profitably delivering what the customer needs by managing and improving the performance of people & process in the construction industry. Lean tools & techniques help in designing right systems, processes & measures to deliver things right first time at the right cost.
Write to us at firstname.lastname@example.org to improve your people & process performance to avoid RERA courts.