If you don’t work in construction it can be difficult to make sense of what the various roles are within the industry. If you’re new to the process and planning a project, you may be wondering which types of pros you should consider hiring. You may have heard the terms General Contractor and Construction Manager before. Sometimes people believe they are one and the same. However, there are different definitions of the tasks associated with these roles and you may need one or the other, or both, so it’s good to know what they actually mean.
The most common use of the term “General Contractor” typically refers to a business entity. This would be a construction firm with its own set of employees. Most people use this term to refer to a licensed, insured builder that is contracted by the Owner to oversee projects that they are responsible for completing, based on pricing given for a defined scope of work.
General Contractors (or GC’s) are usually the top authority figure on a jobsite and are contracted directly with the project’s Owner or developer, who pays them. They should have foreman or superintendents who primarily work at the job site overseeing progress, making schedules, interpreting plans, directing subcontractors and laborers, and managing the job.
GC’s usually have a group of Subcontractors or tradesmen that work under them completing various aspects of the job. Subcontractors may do work for many different General Contractors at the same time. Subcontractors and other tradesmen contract not with the project’s owner, but directly to the GC, who accepts responsibility for paying them and for the quality of their work. Most commonly, General Contractors are named on the project’s Building Permit and have trusted Subcontractors that they tend to use over and over again as they build a relationship and rapport over time.
This serves as an advantage for Owners when comparing General Contractors to Construction Managers. It means that everyone on the project is already familiar with working together so expectations and general operating procedures are likely to be established. This familiarity also implies that there is a certain level of loyalty, cooperation and camaraderie; that the GC and the subs know, like and respect one another. The GC will also take responsibility (financial and otherwise) if a Subcontractor has performance issues. General Contractors most often specialize in one or more types of construction projects.
Unlike a GC, which is usually a firm, a Construction Manager usually refers to either an individual or a group of people. A key difference between the GC’s and CM’s is that the Construction Manager doesn’t do any of the actual building. Rather, they are estimators, project managers, accountants or other professionals that act as the Owner’s stand in or proxy during the project.
General Contractors can also serve as Construction Managers, most commonly on projects that they are not the GC for. A good reason to hire a GC for your Construction Manager is that they are experienced with all the various aspects of General Contracting and thus can effectively manage another GC as the Owners’ representative.
Construction Managers roles are defined by each Owner and that may vary depending on the needs of the Owner. Some Owners are very hands-on and the role of the Construction Manager may be smaller; other times the Owner is located far away or doesn’t want as much input, or doesn’t have the time required to manage the project themselves. In this case the CM will take a much more active role.
Construction Managers are usually compensated at a percentage of the total project cost. The Manager assists Owners with research and other pre-construction tasks such as meeting with designers, financiers, and code officials, or interviewing General Contractors during the planning phases. Often Construction Managers also oversee construction, sometimes by hiring and communicating with Contractors throughout the project’s build phase. Construction managers often work for only one Owner over and over on various projects.
General Contractors and Construction Managers are very different entities, with different organizational structures and responsibilities. They differ too in their business relationships with Owners & Subcontractors, and their entry and exit points on each project. Hopefully this information helps you decide whether you need a General Contractor or the services of a Construction Manager, or both!
Hunnicutt Construction offers both Construction Management services and General Contracting. If you are planning a build, give our team a call to discuss whether you will need a CM, a GC, or both. We’re happy to answer questions and set up a consultation to help you assemble the right team for your job.