Saudi Construction Benchmarking to Improve Performance and Profitability
The client’s internal performance metrics were not aligned with market benchmarks. Key issues included inflated indirect costs, overstaffed project management layers, and inconsistent subcontractor utilization. Without competitive reference points, the client couldn’t determine whether these challenges were internal inefficiencies or industry-wide norms. Procurement and scheduling practices varied between projects, further complicating efforts to measure systemic gaps. These limitations hindered operational planning, investor reporting, and talent strategy formulation.
The project followed a four-phase benchmarking methodology:
- Data Collection: Gathered internal cost, timeline, and labor data across 12 active and completed projects
- Peer Identification: Selected 18 comparable firms across Saudi and UAE markets
- Indicator Mapping: Focused on 10 KPIs including RFI turnaround, productivity (sqm/hour), and site overheads
- Gap Analysis & Recommendations: Identified 8 major gaps exceeding a 10% deviation from peers
Insights were translated into project-specific action plans for internal teams.
Our recommendations included:
- Redesign project reporting to align with 5 critical external KPIs
- Implement centralized procurement to reduce material costs by 6–8%
- Adopt lean construction practices to improve labor efficiency by 12–15%
- Benchmark safety and QA/QC processes quarterly using third-party audits
- Integrate performance dashboards into weekly site management routines
These actions positioned the client to continuously assess and improve performance relative to peers.
By realigning internal operations with benchmarked KPIs, the client achieved cost savings of SAR 9.6 million across three pilot projects. Labor efficiency increased by 14%, while overhead costs were reduced by 11% through site consolidation and centralized services. Visibility into competitive performance boosted internal confidence and helped refine pricing strategies in tender submissions, increasing win rates by 18% in the subsequent bidding cycle.
