Delivering School Construction Successfully

Regardless of the Delivery Method

Presented by:

Doug Sitton, PE, LEED AP

Sitton Construction Group

What if you could spend less time, reduce the overall cost, and

eliminate most of the problems on your next construction project without reducing quantity or

quality?

Agenda

• Case Studies• Project Complexity• Bridging the Gaps• Keys to Success• Project Delivery• Additional Tips

Projects That Fell Short

What did the following projects all have in common that caused them to fall

short of expectations?

Project #1

• New High School• Design/bid/build with CM as Advisor• $45 million new construction• 20-month original schedule• 12 months late• 14% delay claims/change orders

Project #2

• University Student Rec Center• CM at Risk• $13 million new construction• 15-month original schedule• 12 months late

Project #3

• University Student Center• Design/bid/build – multiple prime• $14 million addition/renovation• 18-month original schedule• 12 months late

Project #4

• New College Classroom Building• Design/bid/build – multiple prime• $11 million new construction/addition• 21-month original schedule• 15 months late• 11% delay claims/change orders

What Was The Common Cause?

What did each of these projects have in common?

A. Under-qualified contractor(s) or CM

B. Under-qualified architect/engineer

C. Wrong delivery method

D. Unusually complex

E. Other

The Common Cause

What did each of these projects have in common?

The gaps that existed were not filled

Gaps are caused by complexity

Successful Case Study #1

• $60 million program • 2 new elementary schools• Various additions/renovations• Design/bid/build – single primes• Delivered in 16 months and under

budget

Successful Case Study #2

• $6 million program • Renovations to elementary and high

schools• D/B/B – single primes and PC• Saved $550,000 while adding in

quantity and quality

Project Complexity

Project Organizational Chart

Thousands of exchanges of info in different languages

• Owner• Funding sources• Design firms• Consultants • Contractors• Subcontractors• Utilities• Regulatory agencies• Manufacturers/vendors• Stakeholders

Design/Construction Complexity

Organizations

X

People

X

Processes

X

Technical

X

External Forces

Technical Complexity

• Systems:– Structural

– MEP/FP

– Security

– Data/telecommunications

– Furnishings and equipment

• Codes, soils, environmental, etc.• Project delivery• LEED• BIM

The Cost of Complexity

U. of I. Sues over Dorm's Big Cost Overrun

Cost Overruns at Prairie State Energy

SCHOOL BOARD TO MEET ON SCHOOL COST OVERRUNS

MetroLink Files Damage Suit Against Four Companies

Big Dig Cost Explodes To $22 Billion from Original $2.6 Billion

Complexity = Change Orders

Complexity = Change Orders

Gaps

Why Complexity Often Wins

Where Are The Gaps?

Between all project participants• Owner• Funding sources• Design firms• Consultants • Contractors• Subcontractors• Utilities• Regulatory agencies• Manufacturers/vendors• Stakeholders

What are the Gaps?

• Knowledge and experience• Priorities, goals and objectives• Roles, responsibilities and risk• Information and communication• Cultures and

personalities• Performance

and results

Bridging the Gaps

The Owner’s (District’s) Role

Build the bridges

Start with the 3 legs

The Owner is responsible for the

team of teams.

The Owner’s Role

• Financing/budget/costs• Project delivery method• Requirements/program/operations/objectives• Property/surveys/utilities/environmental/soils• Existing conditions/testing• Schedule• Permits• Furniture/Fixtures/Equipment• Voice/Data/Security• Move management• Reviews/decisions

The Owner’s Role

• Procurement and performance– Architect/engineer– Consultants– Contractors– Construction manager– Performance contractor

• Dispute resolution

The Owner’s Required Expertise

Bridge building:• Improve all contracts• Manage and improve

everyone’s performance• Facilitate collaboration and teamwork• Streamline and improve the delivery of

planning, design and construction

Who Wins When The Owner Has Sufficient Resources?

Everyone!

Two Options: Win-Win or Lose-Lose

Minimize the Owner’s Role?

• Avoid paying for expertise?

Any expertise should more than pay for itself

• Hand it off to the Architect, CM or PC?

Time, focus, qualifications, conflicts

Keys to Success

10 Pieces to the Successful Project Puzzle

10 Pieces to the Project Puzzle

1. Identify Owner’s Expertise

2. Establish Goals and Objectives

3. Maximize Competition for Selection

4. Negotiate Effective Contracts

5. Place Right People in Right Roles

6. Plan Ahead

7. Establish Effective Processes

8. Set Performance Metrics

9. Apply Cost-Effective Technology

10. Lead and Manage Proactively

Solve It at the Beginning

.

Project Delivery

Methods and Myths

Project Delivery Methods

• Design/Bid/Build – Single Prime• Design/Bid/Build – Multiple Prime or

CM• Construction Manager at Risk• Performance Contracting

Design/Bid/Build – Single Prime

• Owner contracts with a design team• Design team provides design and

produces bid/construction documents• Project is bid to single general

contractor• Low responsive, responsible bidder

selected

Design/Bid/Build – Multiple Prime

Same as Single Prime except:• Project is bid in multiple packages• Low responsive, responsible bidders

selected• Multiple primes “assigned” to general

contractor as coordinating contractor

General Contractor as CMa

Same as Multiple Prime except: • Owner contracts with a CM• CM participates in design phase• Owner is at risk and holds all contracts

– no “assignments”• Typically many more contracts

General Contractor as CM at Risk

Same as GC as CMa except:• GC holds the contracts and is at risk

Performance Contracting

• Same as Design-Build except: • For energy savings improvements• ESCO provides:

– Financing

– Guaranteed energy savings

Which Method . . .

Can be completed in the least amount of time?

Requires the least amount of District time to oversee?

Takes the least amount of District expertise to manage?

Has the fewest change orders?

Involves the least risk for the District?

Provides the highest overall value for the District?

Design/Bid/Build – single prime Design/Bid/Build – multiple prime or CMa Construction Manager at Risk Performance Contracting It depends

Which Method . . .

Can be completed in the least amount of time?

Requires the least amount of District time to oversee?

Takes the least amount of District expertise to manage?

Has the fewest change orders?

Involves the least risk for the District?

Provides the highest overall value for the District?

Design/Bid/Build – single prime Design/Bid/Build – multiple prime or CMa Construction Manager at Risk Performance Contracting It depends

It Depends

• Every method:– Has positives and negatives, has

succeeded and failed– Is complex, just in a different way– Can be fast-tracked– Should never be used “as is”– Should be tailored to the specific client,

project, and local/current market

• Customization and management matter most, not the method

Selecting Project Delivery

Consider:• Most common, best understood• Experience and knowledge of:

architect, engineers, contractors

Don’t consider:• Time – overall or District’s• Change orders• Risk

These are customization considerations

Additional Tips for Success

Minimizing Owner’s Time Invested

• Have the right level of expertise• Invest the time early• Avoid gaps

More time here

Pick Any Two

• The Project

Management

Triangle

• Why not have all three?• Low quality often adds cost and time• Quality design can reduce overall cost • “Too” slow and “too” fast both cost more• Effective Owner management improves all

three

Improving All Three – Q/B/S

“Avoidable failures are common and persistent . . . the volume and complexity of what we know has exceeded our individual ability to deliver its benefits correctly, safely, or reliably.”

“We need a new strategy . . . and there is such a strategy. It is a checklist.”

Getting Things Right

• Ninety-second checklist• Complex world of surgery• Eight hospitals around the

world• All kinds of operations• Reduced deaths and

complications by one-third• No cost

Example Checklists

• Facility appraisals • Facility assessments• Plan/spec reviews• Inter-disciplinary reviews• Scorecards

eTools Examples• Building Information Modeling (BIM)• eProject Management• eDeliverables

Summarizing Success

• Understand the complexity• Identify expertise necessary for the

District’s “Owner” role• Identify/predict the gaps• Bridge the gaps• Use checklists!

Equal Understanding is Key

“Armed with the most the most powerful weapon in anyone’s business arsenal

– understanding – you will have a fighting chance to get the building you want, when you want it, for the price

you originally agreed upon.”

Broken Buildings, Busted Budgets

by Barry LePatner