The way to deliver 96%+ of renovation, repair, and maintenance projects on-time, on-budget, and at the appropriate level of quality is to enable collaboration with contractors and other expert service providers
Robust collaborative construction delivery methods provide a proven path for Owners to significantly improve construction productivity and levels of satisfaction among a participants and building users.
The major challenge to delivering construction services on-time and on-budget , however, is the required level of Owner capability and competence.
As a result of 1800+ tests, researchers have concluded that a primary cause in low project performance (time, cost and customer satisfaction) is the traditional owner-vendor relationship in which the owner uses a design, bid and build (DBB) approach. – 2016, Arizona State University – Job Order Contracting Performance Survey-2015
This obstacle can only be overcome by changing current formal education and professional training programs. Educational and training programs must focus upon asset life-cycle management and modeling. An improved understanding is required among real property owners, facility managers, architects, engineers, and construction contractors relative to the various COMPETENCIES, PROCESSES, COMMON TERMS, and TECHNOLOGIES associated with efficient life-cycle management of the built environment.
Overall focus must shift from first-cost mentality to life-cycle/total-cost-of-ownership. Business aspects must shift from lowest-bidder and adversarial, inefficient design-bid-build delivery models to BEST VALUE, INTEGRATED COLLABORATIVE CONSTRUCTION DELIVERY.
The most widely used and known collaborative construction delivery methods are INTEGRATED PROJECT DELIVERY, IPD (for major new construction), and JOB ORDER CONTRACTING, JOC (for renovation, repair, sustainability, maintenance, and minor new construction).
Properly designed and implemented Job Order Contracts can deliver 96% of projects with satisfactory results, a level unmatched or even approached by traditional construction delivery methods. Faster project delivery, financial transparency, and less required project management are additional benefits provided by JOC.
JOC Do’s and Don’ts
From a generic perspective, an effective measurement system for a job order contract will incorporate the following:
- Clearly defined, actionable, and measurable goals.
- Goals that include consideration of global oversight and local actions of all JOC program participants.
- Key performance indicators that monitor the overall administration of the JOC program, as well as individual projects / task orders, and all associated workflows, deliverables, and outcomes.
- Established baselines that enable measurement of historical and current progress.
- Timely, accurate, repeatable, and verifiable information based upon standardized terms, definitions, and data architectures
- Applicable reporting and feedback systems to support continuous improvement of processes, practices, and outcomes.
The importance of Job Order Contract performance measurement cannot be understated. As JOC is a LEAN best-management practice, it is dependent upon foundational elements that enable collaboration, transparency, and continuous improvement. Furthermore since many Job Order Contracts are use across building portfolios and locations, the diversity of participants, requirements, and activities demands specified levels of capabilities, performance, and responsibility.
THE DO’s & DON’Ts of JOB ORDER CONTRACTING
A JOC performance measurement system should be capable of answering questions such as the following:
- How many requests for quotations have been issued?
- How many contractor estimates have been issued?
- What is the average time from RFQ to contractor estimate?
- How many owner estimates were created?
- What is average time to create an owner estimate?
- What is average variance between owner estimates and contractor estimate?
- How many cycles were required for owner/contractor negotiations per task order?
- How many task orders were completed on-time, on-budget?
- What percentage of task orders required change orders?
- What is the total value of change orders?
- What is the average project delivery time?
- What is the level of quality of work performed?
- What is the level of responsiveness of the contractor? The owner?
- What is the average dollar value of the task order
- What problems or issues need to be addressed?
- How do associated JOC metrics compare to alternative construction delivery methods?
- Overall trend of KPIs versus time?
- Is the JOC slowing the overall deterioration rate of the buildings or infrastructure?
- Is the JOC improving the service levels supported by the built infrastructure?
- Is the JOC contractor technically capable of all JOC tasks?
- Are Job Order Contract funding levels sufficient?
- How are Job Order Contract activities dispersed throughout the year?
Associated key performance indicators should enable management to determine if the Job Order Contract is meeting established organization goals. The key characteristic of KPIs are as follows (Aveson, P. 1998):
- Leading Indicators: forecast future trends inside and outside the organization
- Objective and Unbiased: fact based, not subject to manipulation and can be repeated
- Normalized: can be benchmarked against other organizations
- Statistically Reliable: small margin of error
- Unobtrusive: not disruptive of work or trust
- Inexpensive to Collect: small sample sizes adequate
- Balanced: qualitative/quantitative, multiple perspectives
- Appropriate: measures the right things
- Quantifiable: for ease of aggregation, calculation, and comparison
- Efficient: can draw multiple conclusions out of dataset
- Comprehensive: show all significant features of an organization’s status
- Discriminating: small changes are meaningful
- Action Oriented: suggest next analysis or action step; motivate and direct action
- Understandable to Decision Makers: understanding of performance indicators not dependent upon specialized facilities management knowledge; highly intuitive
- Verifiable: auditable.
Job Order Contracts may be implemented for a variety of reasons, however, anticipated benefits or outcomes generally includes all, or a subset of the following:
- More responsive / on-demand services
- Higher quality work product
- Shorter procurement times
- Shorter overall project delivery time
- Lower total cost
- Higher overall levels of satisfaction from all program participants
- Greater financial visibility
- Higher overall transparency
- Shared and acceptable levels of risk/reward
- A collaborative working relationship between program participants
- Long / longer term relationships
- Improved resource utilization / reduced waste
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