Let’s paint a scenario… As a project manager for a large construction firm, you tender for a small, three-month project to replace a piece of infrastructure on a remote site, near a small town in Mpumalanga. The client specifies that the majority of your unskilled and semi-skilled workforce should be local. You don’t mind, because your crew of specialists are only about 14 guys, and they are used to working away from home all the time. They are labour broker guys. The semi-skilled labour you need is probably not more than 30 people: trench diggers, a few tacklers, cleaners, two people waving flags, fire watcher, general labourers – all locals. They come straight to work from home and organise their own food and transport.
The crew you’re bringing in are two crane operators, a couple of speciality welders, a few riggers, cementation guys, a driver and supervisor who must all stay in town. You decide to rent two houses and supply basic furniture. On Property24 you see that you can easily rent a house for no more than R7 500 per month. There are about seven houses to let right now, but surely, by the time you need to be on site, the local estate agents will be able to supply you with a few more options. Your supervisor definitely needs his own room, and bathroom. You don’t really mind because it’s only one guy.You find plenty of guesthouses in town on Airbnb. Two pique your interest at R450 per night, including breakfast. There is also a farm a few kilometres outside town, on a gravel road. They can accommodate your whole crew, at a very affordable rate, if need be. Armed with your research, you cost your project, submit a tender, leaving an 8% margin of error on the accommodation. Seven months later, the tender is awarded to you. You read in Engineering News that the project is actually somewhat bigger than the portion you have tendered on. SANRAL is also starting work on a section of road that will be broadened between the town and your site to allow for the increased volume of coal transported by road to the nearby power station.
As you start to ramp up your arrangements, you notice that the guesthouses are no longer advertising rates of R450 per night, as they did before. Everyone is now starting at R1 050 per night. It must be the start of summer. You’ve spoken to your labour broker, and everyone agrees that you are not going to use guesthouses, and that it would be best if everyone stays in houses. You decide to give your supervisor the main bedroom, with a private bathroom, in one of the houses – even if it means you may now need a third house. You will furnish the houses with basic furnishings, and the guys will also bring some personal items with them, to make them feel at home. In your costing, you made provisions for a single bed and mattress. You will also provide each bed with one set of bedding and a bedside table. There will be one TV and microwave per house and some basic kitchen utensils. You also decide to employ a local housekeeper to clean the houses, do the laundry by hand and perhaps help with cooking. You again go back to Property24 and find houses for rent and call the agent. You reach the local attorney, who is also the only estate agent with an office in town. National franchises have offices in a larger town, 80km away. However, it seems like they list not only some of the same, but even fewer houses than the attorney. Luckily, the attorney knows all about the infrastructure programme and the SANRAL project, and he has been able to secure a number of properties from local people. Some of these properties are even furnished –what a bargain. Lease agreements are also handled by the attorney’s office and they also broker accommodation in various guesthouses including the farm which is now, unfortunately, fully booked by a large cementation company. You feel a little anxious and decide to take two days and go into town to see the attorney and perhaps also recce the streets for “to let” signs.
Your accommodation in the only guesthouse with a room available at R1 400 for the night. Breakfast (which is included) is cereal, yogurt and Ricoffee with Ouma rusks. The attorney will talk to his clients to perhaps consider a six-month minimum rental, but it would appear the norm is actually a minimum of 12 months. According to the owner of one property, there are many delays on this project, so he thinks that you shouldn’t worry about the six-month lease term. On the plus side, it looks like there are at least six possible properties, although now starting at ±R22 000 per month, excluding water and electricity. It also dawns on you, that none of the properties you have seen boast any en-suite bathrooms. Another unfortunate realisation is that there are no prepaid meters in any of these old houses. Next to the most promising house you’ve seen so far, there is a small workshop which shares the electrical connection with the main house. “At least they are very honest in terms of bookkeeping electricity consumption,” the attorney tells you. You meet with the guy who rents the workshop, and it sounds like he may even have space for contractors on a plot, not too far from town, and can supply meals. The next morning, after viewing converted animal pens originally built in the early 1950s, you look at eight more houses. You decide to stay another day, but you have to move to a different room, because the room you were in the night before, was pre-booked by SANRAL.
The next day you visit four guesthouses, two converted offices, the local school hostel and a caravan park, which may provide containers that can be used for workers to sleep in. You also meet the manager at the local OK Bazaars who can possibly help with meals for your workforce since the idea of a housekeeper who can also cook didn’t materialise. Later that afternoon, the head of the local taxi association – who you were meant to meet outside the local municipality – never arrives. At least you had time to register as a prospective employer who would be employing local people, and gave out your personal cell number. On your three-hour drive back, you contemplate some issues. You have not signed for any houses because they cost about three times more than what you budgeted. What’s more, no one will have a private bathroom. The attorney requires a two months’ deposit and the first month’s rental upfront. And yes, there is a local furniture store in town that can supply and deliver the furniture, fully assembled, and installed, saving you another two-day outing and trailer rental but the cost is way higher than the factory in Rosslyn quoted you for your cost estimate. The owner of one house said that everything in his property is brand new, although you couldn’t tell this from looking at the house. You can’t help but be a bit worried about the issues you may encounter if there were any damages to this “newly renovated” house. You’re also trying to remember what the attorney mentioned about penalty clauses for early termination of leases. Hopefully you’ll be able to see the taxi association head when you return next week to look at a possible yard for your cranes. As you pull into your driveway, you realise that none of these issues are actually in any way related to your project, but all of them will influence your success.
Scenario complete. What did you think? Is it sounding like a nightmare?
As the owner of a contracting company or a project manager at a large firm, you may find the “tongue in cheek” nightmare scenario depicted in the story above very close to, if not 100%, accurate. The board and lodging of project resources can be a pain, and an expensive pain at that. One should consider the actual cost of self-managing offsite services, in terms of time, effort and risk, before, during, and after the conclusion of a project. By onboarding a nationwide offsite services specialist like iLodge during the planning phase of your project, the risks for latent costs associated with offsite services are largely reduced, if not avoided entirely. Based on the story above, iLodge would typically render the following services under contract before site establishment:
- Conduct a thorough accommodation and services audit and share the results and recommendations with the project team.
- Provide fact-based, real current costs, for the required services in the specific geographical area, or on similar projects.
- Formulate an offsite services strategy based on the audit, the project requirements and the budget.
- Visit and inspect each proposed local service provider.
- Conclude agreements with all approved and necessary service providers for the required service.
- Engage and negotiate with the local taxi association and arrange for all transport requirements.
- Engage and negotiate with local catering and laundry suppliers as required by the offsite service project plan.
- Provide regular communication on the implementation of the approved offsite services action plan.
With the above steps taken and arrangements made, the client company will not have wasted any time or human resources.
