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For years, construction has had extremely low productivity growth compared to other industries. Fragmentation within the industry is often cited as the primary cause of this. While other industries have been incentivized by the economies of scale they could realize by putting together large teams and sophisticated processes, such economies have been rarer in the construction industry because each project has a unique set of challenges and opportunities. This has had a detrimental effect on many aspects of project delivery and on overall project success. But new workflows and technologies are enabling the construction industry to achieve greater alignment across projects, with both information and relationships having broader reach than were once possible.

Traditionally, phases of work have been competitively bid. Architects, engineers, general contractors and subcontractors are typically part of different companies that have different—and often conflictinggoals and objectives. Furthermore, the goals for individual projects are short term: the multiple firms that come together to construct a single project move on after it is complete. In this scenario, it is too easy for the companies to become aligned against one another. 

In response to competing interests, hierarchies form. Subcontractors are typically the most affected. Seen as being at the bottom of the chain, they are not treated as equal partners. However, subcontractors are often able to provide great perspectives, ideas, approaches and solutions to a project. If their input is not considered during project planning, this expertise goes untapped, leading to errors and delays as the project moves forward. This is a direct result of competitively bidding the phases of the project.

While competitive bidding may result in lower costs to the owner, it can lead to disputes and conflicts as players seek to shift risks. The litigious nature of construction fuels a risk-averse culture, and a downward spiral is perpetuated. Contract structure and wording tend to reinforce individualism and competitiveness. This translates into unforeseen costs that are passed along to the owner, negating the low prices that seemed to be the benefit of a competitive bid.

Contract structures do exist that can overcome these difficulties. A few of the most common are design-build, early contractor involvement and engineer-procure-construct. With design-build project delivery, a single entity–the design-build team–works under one contract with the project owner to provide design and construction services. It offers a single point of responsibility and is used to minimize risks for the project owner and to reduce the delivery schedule by overlapping the project's design and construction phases. ECI project delivery seeks to capture specialized knowledge on the part of the contractor during very early preconstruction. It involves a two-stage contract and offers advantages related to constructability as well as more realistic budgets and schedules. An EPC contract gives owners a single point of contact for their project. EPC firms handle design, procurement of all equipment and construction materials, and construction services for turnkey delivery of a facility, usually at a lump-sum price or cost reimbursable. 

Ultimately, building and facility owners want the same thing that other industries’ customers want: predictability, a smooth process and on-time, on-budget delivery. They want finished buildings and facilities that meet the plans and specifications originally outlined. Design and construction are means to an enda new facility or completed project—and streamlining the path to that end goal is valuable.

Aligning Project Team Members

Rallying the construction team around the common goal of delivering an optimal solution can greatly reduce project risks and cost and schedule overruns. Successful projects require a clear definition of expectations and responsibilities, with all partners being held accountable. 

Technology, from building information modeling to construction collaboration software, has been a significant enabler of communication and accountability. In the last 10 years, there has been an explosion of software and technology offerings. These include file sharing, RFI and submittal tracking, cost reports, safety checklists, scheduling tools, project management and more. The software enhances communication across planning, design and construction teams and makes for quicker documentation, access to real time information, reduced delays, fewer change orders, etc. If the software is cloud-based, it improves project efficiency by being accessible in the field. Team members can access models and plans, manage labor, measure and track progress, manage punch-lists, record safety observations and inspection data, and even track materials using RFID and infrared scanners. Ultimately, the collaboration software is improving outcomes, including overall project quality, for the owner.

While technology has been a huge enabler, the value of building relationships and having face-to-face meetings cannot be discounted. Newer project delivery methods recognize the importance of relationships as opposed to transactions. They emphasize working together to solve problems and achieve the desired outcome—not on assessing blame, making accusations or gearing up for a legal battle.

Company culture must be changed to reflect a commitment to collaboration and open, honest communication. Each team member must have a sense of shared interest in the project outcome. This culture is easier to institute if all of the people involved have input and decision-making capabilities. Creative approaches and a multiplicity of ideas not only lead to better, more informed decisions, but create a rewarding work culture, thus perpetuating success. Commitment to a common vision fosters inventive solutions to problems that arise during construction. In addition to company culture, a project culture can be formed.

Furthermore, companies must be willing to work together, sometimes at a sacrifice. This can be a tough concept to sell; however, it helps to emphasize that the situation is temporary and limited, because short-term sacrifices that result in a better product eventually translate to better client relationships and a better firm reputation—which is a marketable item in the workplace.

Both technology tools and relationship-building can be leveraged to improve a project during its planning phase. When an owner and key project team members are brought in and engaged early on, it sets the tone for the entire project. Planning sessions can be used for sharing the overall vision; a project charter can be created and signed, gaining commitment from all team members and clarifying project goals and responsibilities. The charter creates a framework for how the project will be managed and becomes the basis for decision making. 

Early project definition and a formal approach to capital appropriation are critical for evaluating risk exposure and mitigation strategies. They highlight specific risks to success, especially from a design and cost standpoint. They also achieve efficiencies by helping designers and construction firms understand an owner’s approach, thought process and critical items.

Successful project definition should exhibit the following characteristics:

  • every potential project is viewed as an opportunity for savings;
  • capital is directed toward the areas that best benefit the organization’s overall goals;
  • stakeholders are included in the front-end loading process at the appropriate times;
  • each step in the capital process is connected to and builds on the previous step;
  • long-term requirements are considered at the front-end of a project; and
  • “gates,” or review processes, ensure that projects meet owner-established criteria at the beginning of the project in order to move forward. 

The construction industry needs to move beyond being a siloed and adversarial industry, where incentives lead stakeholders to preserve their own self-interests and priorities. The traditional chain of command that was instituted to avoid or mitigate risks has hefty costs in terms of delays and inaccuracies. Common goals are the solution, because synergies between team members can produce quality products more efficiently. Genuine collaboration results not only in improved outcomes for the owner, but in more successful projects for all parties involved. It leads to less friction, improved relationships, safer jobs, better quality and higher profits.

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