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CM Through The Eyes Of Both Owner And Industry -- Part 2: Industry Perspective





BY: Chris Hopkins, CCM, PMP, LEED AP BD+C, President SIRIS

INDUSTRY PERSPECTIVE

An experienced Construction Management team engaged early in the capital project lifecycle can multiply the cost effectiveness, optimize the schedule, and reduce the life cycle costs of almost any project. Owner’s can expect a return on investment is roughly three times the return on investment (ROI) during the project and a ten times ROI over the building lifecycle compared to a CM brought on after Construction notice to proceed. This benefit of early involvement is realized by a set of unique services provided by the construction management industry in these four major categories.

  1. Process Optimization – Every organization has silos that develop. These silos are not always bad, some common silos are departmental (Contracting, Financing, Facility Engineering, etc.) others are personality driven. A Construction Manager is tasked as the bridging element. They are a fresh set of eyes questioning organizational processes and procedures that need to be streamlined to meet the project goals. The CM will then analyze how those systems are applied, integrated, and communicated into the project/program team ideally creating a better organization.

  2. Decision Management – The worst decision is often due to the pursuit of a perfect decision at some indefinite point in the future. A Construction Manager should be central for both internal and external Owner correspondence and decision making early in the project/program. Good CMs foresee crucial decisions, potential contradictions and risks in the Owner’s plan and present the implications far enough in advance to illicit well thought out decisions at the right time. This creates less rework, delays, and last-minute changes.

  3. Alignment with Facility Operations – A Construction Manager is uniquely positioned to provide total project budgeting and proactive schedule management (discussed below). One of the key stakeholders to actively manage is the Owner themselves. Schedule delays can originate in design and contactor activities. However, the Owner can also be a source of schedule delay in many ways. This can come from untimely decisions, changed decisions, and changes from User Groups. It is the CMs responsibility to manage the entire project, which includes the Owner and the other participants. These budgets will capture all foreseeable costs, factor in long lead items, acquisition strategy, organizational/business impact, and provide phasing that allows for acceptable levels of interruption to operations.

  4. Transition to Operations – A Construction Manager plans for successful project handover by considering the information needs of operational stakeholders. These stakeholders include, but are not limited to, Facility Directors, building occupants, and maintenance technicians. The stakeholders extend to every member of the project delivery team in some manner as well, such as design professionals, construction personnel, and third-party support services. T2O enables efficient facility startup and activation by providing operations and maintenance staff with the information they need to establish and maintain their maintenance programs. T2O defines and supports the flow of Facility Maintenance (FM) information throughout project delivery. These lean processes include planning, specifying, collection, verification, import, and operations. T2O is most impactful when incorporated into contractual requirements of the project team participants during the planning phase.

Some of the best practices CMs use to bring value to the process are:

  1. Total Project Budgeting (TPB) - TPB has three phases of cost development: 1) Modeling, 2) Estimating, and 3) Managing. Cost Modeling utilizes historically derived and collected information, and the experience of the estimator as it pertains to unit item costs, time, and the projects’ intended end use to generate budgets. Cost Estimating is driven and informed by the design as prepared by the design team and their project consultants. Cost Management: During the Design and Construction Phases it is critical that the estimating team remain engaged.

  2. Proactive Schedule Management – The purpose of proactive schedule management is to set the stage for great execution during the Pre-Project Planning Phase by establishing and communicating schedule expectations, requirements, and reporting standards. The best results start in advance of the AEC team member solicitations and establishment of the Owner’s scheduling requirements (i.e., Owner’s Schedule Specifications in Division 01). If those are deficient or do not exist, then it is the CM responsibility to make appropriate recommendations and adjustments. This minimizes conflicts later in the Project Implementation Phase when the requirements must be executed.

  3. Owner Decision Matrix – Owner’s should require appropriate time to make decisions. The CM team helps to communicate and define those critical decisions to be presented to the Owner’s Project Team with enough time to adequately evaluate the options. This can include mock-ups, finish boards, contracting decisions, or activation clarity.

  4. Operational Efficiency Review (OER) – Often a project can be stalled or significantly hindered if operational impacts are not considered in the plan. This must be balanced with construction costs to properly make a decision. Something like off-site storage of medical supplies for a hospital in Manhattan is often an operational “no-go” and needs to be identified early, security corridors, clean corridors, and other key constraints if identified early can save Owners a great amount of time and money.

  5. Project Development Rating Index (PDRI) – Project Definition Rating Index (PDRI) is a project process created by the Construction Industry Institute (CII) to assess scope gaps early in the design process. Identification of these scope gaps allows for closure strategies and risk reduction for the project. The CII tools allow for a structured and repeatable process to be followed each time. The evaluation tool includes sixty-four (64) unique elements. Most of the elements focus on “early design” impacting items related to the owner’s Project Decision and the Basis of Design, accounting for over 80% of the weighted points available. Thus, PDRI has the most impact during the pre-design and design phase of the project.

  6. Constructability/Biddability Review – This is a more common tool used by clients. Constructability reviews are organized methodically for continuously identifying and measuring key metrics that decrease project risks in the design phase. Project risks include anything that threatens or has the potential to endanger the scope, schedule, budget, or quality of the project to include anything that is a risk to the safety of patients or staff. On the other hand, biddability reviews focus on the ease with which the design can be understood and key logistic or operational considerations that bidders may need to understand.

Bottom Line - close collaboration and communication early in the process and identifying where you can leverage the Core Competencies of CM Professionals and continuously education Owners is an endeavor that can benefit both industry and owners. See the Six Construction Management Core Competencies from the CMAA website and think about constructability at all phases and see if the scope, schedule and budget allows for CM services much earlier in the project lifecycle.

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