In my post about identifying risk in projects, I said that I used Microsoft Copilot AI to generate a list of risk prompt questions. I wanted to share that full exchange to give project managers a taste of some basic ways to use AI to make their project plans stronger and easier to create. There are lots of articles online that go into much more advanced applications, so this will be a very basic one in comparison. I hope that will means it will be approachable for most project managers and increase its helpfulness.

The Conversation

Me: What are some reasons commercial construction projects go over budget?

AI: A commercial construction project can go over budget for several reasons, some predictable and others completely unexpected. Here are some of the most common factors:

1. Design Changes & Scope Creep
   Modifications to the project design or additional features requested after construction begins can significantly increase costs.
2. Inaccurate Cost Estimates
   If the initial budget underestimates labor, materials, or permitting fees, unexpected expenses can quickly add up.
3. Unforeseen Site Conditions
   Issues like unstable soil, underground utilities, or contamination can require expensive solutions that weren’t planned for.
4. Material & Labor Cost Fluctuations
   The prices of construction materials—steel, lumber, concrete—can change due to market conditions. Labor shortages or wage increases can also drive up costs.
5. Permitting & Regulatory Delays
   Securing permits or meeting compliance requirements can take longer than expected, leading to increased costs.
6. Poor Project Management
   Lack of coordination between contractors, suppliers, and designers can result in miscommunication, delays, and rework.
7. Weather-Related Delays
   Extreme weather, storms, or unexpected natural events can slow construction progress and require additional resources to stay on track.
8. Contractor Issues
   Disputes, inefficiency, or financial instability of contractors and subcontractors can cause disruptions, leading to higher expenses.

Managing costs in commercial construction requires careful planning, solid management, and strong communication. Are you dealing with budget concerns on a project?

Me: What strategies can help prevent budget overruns? [this was a suggested prompt, I didn’t come up with it]

AI: Keeping a commercial construction project within budget takes careful planning and proactive management. Here are some key strategies to prevent overruns:

1. Precise Budgeting & Contingency Planning
   Start with a detailed cost estimate, factoring in labor, materials, and potential risks. Set aside contingency funds—typically 10-20%—to handle unexpected expenses without derailing the project.
2. Scope Control & Change Management
   Define the project scope clearly and resist unnecessary changes. If modifications are needed, ensure they go through a structured approval process with a cost analysis.
3. Strong Vendor & Contractor Selection
   Work with reliable contractors and suppliers who have a track record of delivering quality work on time. Vet bids thoroughly and avoid selecting based solely on the lowest price.
4. Real-Time Cost Monitoring
   Use construction management software to track spending as the project progresses. Regularly compare costs to the budget to catch discrepancies early.
5. Well-Defined Contracts
   Create detailed contracts that outline pricing, responsibilities, schedules, and penalties for delays. Clear agreements help avoid disputes and unexpected financial burdens.
6. Risk Management & Site Assessments
   Identify risks early—such as soil issues or regulatory hurdles—and plan accordingly. Conduct thorough site evaluations to uncover hidden challenges before construction begins.
7. Efficient Scheduling & Resource Management
   A realistic timeline and optimized resource allocation can prevent delays, which often lead to additional costs. Ensure materials and labor are available when needed to avoid downtime.
8. Communication & Collaboration
   Keep all stakeholders informed and engaged. Open communication between developers, contractors, and suppliers minimizes misunderstandings that could lead to costly mistakes.
9. Periodic Audits & Reviews
   Conduct regular financial audits to confirm spending aligns with projections. Adjust strategies as needed to keep costs controlled.

Planning ahead and staying vigilant throughout the project can make a huge difference in maintaining financial stability. Are you involved in a construction project right now?

What to Do With This?

So we’ve seen an example of AI having a reasonably good knowledge of project management problems and tools that can help. So what? How can we make use of that?

I am by no means a “power user” of AI, so others use it much more than I do. But here’s my approach: Normally I either (1) use the results as inspiration or ideas, or (2) take the structure and rework it for my own purposes. This even works with images or diagrams/drawings generated by AI.

Reasons to use it: The US Copywrite Office is working on legal guidance covering the details of copywrite in AI. However what seems settled is that content generated 100% by AI is not copyrightable, as a human author is required for copywrite to apply. That means that you can directly copy/paste AI content in your work, adapt the ideas as you see fit, or even directly sell it and no one can sue you for intellectual property reasons. However, please verify it first. As a professional, you are 100% responsible for any content you use, whether AI-generated or not. There are serious and sometimes funny stories about professionals trusting AI more than they should, as AI has been known to very confidently invent “facts” or cite “sources” that aren’t real at all.

Reasons to be careful: If you are using AI generated content in any academic context, whether as a student or a researcher, please talk to your librarian. Sometimes using AI-generated content academically can still be considered a violation of anti-plagiarism or academic integrity standards, even if it’s not technically illegal.