Job Order Contracting versus Design Bid Build

Job Order Contracting versus Design Bid Build

Job Order Contracting versus Design Bid Build can help to measurably improve construction productivity, quality, delivery times, and overall satisfaction for all participants.

Job order contracting saves significant time and improves quality, consistency, and overall satisfaction vs. traditional design-bid-build.

Efficiently managing the numerous renovation, repair, maintenance, sustainability, and minor new construction projects facing real property owners and facilities management teams is critical to the success of every facilities dependent organization.

Job order contracting is a LEAN collaborative construction procurement and delivery method that that delivers major advantages versus conventional design-bid-build.   The focus placed upon early upfront and ongoing communications and full transparency associated  with Job Order Contracting  is central to improving outcomes.

Even though job order contracting has been successfully practiced in the U.S. since the 1980’s, it remains unknown to many and is commonly poorly implemented.

Job Order Contracting requires competency and leadership on the part of the owner, and an appropriate focus upon change management.    Collaboration, mutual respect and trust among selected service providers and the owner,  and full financial transparency are targeted goals.

A locally researched, independently sourced detailed line item Unit Price Book, UPB, provides the basis for shared project knowledge and transparent pricing.   A properly designed UPB lists common and repetitive commercial construction tasks construction tasks using industry standard terms in plain English.   Each line item includes labor, material, and equipment costs as appropriate.  The UPB generally has approximately 40,000 to 60,000 line items, including demolition line items and line item modifiers.   The latter account for varying quantities, work location, and other variables.    Best management practice notes that the UPB be updated annually and locally researched.

JOC is an  an integrated project delivery (IPD) approach designed specifically for smaller renovation, repair and minor new construction projects, however maintains all the same collaborative principles.

Integrated project delivery ” integrates people, systems, business structures and practices into a process that collaboratively harnesses the talents and insights of all participants to reduce waste and optimize efficiency through all phases of design, fabrication and construction…. Integrated Project Delivery is built on collaboration. As a result, it can only be successful if the participants share and apply common values and goals.” – AIA

Benefits of Job Order Contracting versus Design Bid Build

  • Higher productivity
  • Improved quality and overall satisfaction
  • On-demand services
  • Improved financial visibility
  • Virtual elimination of legal disputes
  • Fewer change orders
  • Fully defined roles, expectations, and deliverables.

Job Order Contracting versus Design Bid Build

Common Myths Associated with Job Order Contracting versus Design Bid Build

  • Higher costs
  • Best to outsource (JOC managed by a JOC consultant versus a JOC Owner)
  • JOC is for everyone
  • JOC can be managed in spreadsheets
  • JOC doesn’t require continuous training
  • Procurement, facility end-users, and technical teams (DPW/facilities management) are not directly involved
  • Owners don’t need to review contractor estimates
  • Owners don’t need to prepare their own internal estimates for some projects.
  • JOC programs don’t need to be audited

Learn more…

Job Order Contracting versus Design Bid Build

DoD Construction Estimating

DoD Construction Estimating

DoD Construction estimating can be significantly improved with the use of local market, objective, and current construction cost data.

Historically many DoD sites have use “national average” cost data and have attempted to localize information with “area cost factors” and/or other forms of “cost indexes”.   This traditional method can introduce significant errors in cost estimation as demonstrated by several independent sources.

The primary issue associated with construction cost location factoring is Data Accuracy.  Inaccurate data can lead to incorrect cost estimates. Cost data must be up-to-date, and reflect local market conditions (labor, material, and equipment), at a granular level.  The application of factors to an estimate introduces significant error as the method cannot account for a wide range of variances.

Whether new builds, repairs, renovation, or maintenance, including preventive maintenance, the use of local market, current and verifiable granular cost data can significantly improve cost visibility and cost management.

If you are a DoD department or agency and wish to beging a journey to save 30%-40% of construction, renovation, repair, or maintenance costs, reach out to schedule an educational online meeting or reach our capability statement.

FAST and RELIABLE Cost Estimates
commerical cost

DoD Construction Estimating

Four BT, LLC
CAGE/NCAGE: 7RB80
84 COTTONWOOD LN
NAPLES, FL 34112-7230 USA
www.4bt.us
info@4bt.us
903.326.9965‬

Additional Information;

While construction cost factors are widely used for estimating project costs, there are several challenges and potential problems associated with their use. Here are some common issues:

  1. Regional Variations: Construction cost factors rely on regional averages. Local variations in labor costs, material prices, equipment availability, and regulatory requirements can greatly affect the estimate. If your project is in an area with significantly different market conditions, estimates may be poor.
  2. Project Size and Scale: Cost factors may not scale linearly with the size or scale of a project. Large or complex projects may have different economies of scale, and cost factors may not accurately reflect these variations.
  3. Limited Detail: Cost factors are often broad and generalized, providing average values for various  construction aspects or categories. This lack of detail can be a limitation for most projects that generally require a more detailed breakdown of costs.
  4. Inflation and Economic Changes: Economic factors, such as inflation rates, can impact construction costs over time. Cost factors may not account for these changes, leading to significant discrepancies between estimated and actual costs.
  5. Technology and Innovation: Advancements in construction technology and methodologies may not be reflected in traditional cost factors. Innovative approaches or new materials might not be accurately represented, leading to potential underestimation or overestimation of costs.
  6. Lack of Project-Specific Information: Cost factors are based on average conditions, and they may not take into account the specific conditions of a project site. Site-specific challenges, such as environmental conditions or logistical constraints, may not be adequately considered.
  7. Over-Reliance on Averages: Averaging costs across various projects do not capture outliers.  Relying solely on averages without considering the range of potential costs can lead to significant errors.

To mitigate these issues, it’s advisable limit the use of construction cost factors and rely upon detailed local data, expert judgment, and a thorough understanding of specific project requirements.

 

FAST and RELIABLE Cost Estimates

FAST and RELIABLE Cost Estimates

Finally, FAST and RELIABLE Cost Estimates for construction, renovation, repair, and maintenance are now possible with 4BT’s local market detailed cost data!

  • Objective
  • Current
  • Local Market
  • Detailed
  • CSI Masterformat
  • Preventive Maintnenace Cost Data (also available – organized using expanded UNIFORMAT)

Gain measurably improved cost visibility and cost management capability for your organization by using verifable data to build FAST and RELIABLE Cost Estimates.

 

Learn Why 4BT’s Data Structure Excels.

FAST and RELIABLE Cost Estimates

FAST and RELIABLE Cost Estimates
commerical cost

FAST and RELIABLE Cost Estimates FAST and RELIABLE Cost Estimates

Construction cost data must be valid, reliable, and verifiable  to objectively and realistically represent current local market conditions.

  1. Exclusive source of current, LOCAL MARKET commercial construction cost data
  2. Measurably improve Cost Visibility and Cost Management Capabilities
  3. Evaluate and validate contractor bids / proposals with verifiable cost data for materials, labor, and equipment
  4. Eliminate Guesswork: Remove reliance on error prone “market average cost data, location and economic adjustment factors.
  5. Support LEAN and Value Management Principles: Enable waste reduction, value generation, and continuous improvement by providing verifiable and actionable data.
  6. Adapt to Market Realities: Ensure projects are not derailed by unexpected cost changes.

Care should be given as to what form of cost data is being used. 

Objective, verifiable, and locally researched detailed line-item construction tasks, replete with labor, material, equipment and productivity information, provide the highest level of cost visibility and cost management capability.   4BT exclusively offers this information for any location, with all line-items organized using expanded CSI MasterFormat, enabling clear communication, collaboration, and alignment with all technical domains and participants throughout the planning, procurement, and project delivery lifecycle.

Other, less stringent forms of cost estimating include the following:

  • national average line-item cost data (with or without adjustment or localization factors),
  • system level cost data,
  • assembly level cost data,
  • building level,
  • and/or other forms of parametric cost data,
  • historical cost data and economic factoring,
  • contractor, subcontractor quotes.

[NOTE: UNIFORMAT is best used to express functional elements (assemblies) of a repair, renovation, maintnenance, or new build project).  It provides a consistent approach that describes associated components across different projects in cost and function.   UNIFORMAT primarily use is in early stages of a project where a specific work scope (scope of work/SOW) has not been fully defined and  critical characteristics of the projects  not yet been determined, or to denote “Assemblies” that are create from MasterFormat unit price book line items.   MasterFormat, accounts for  specific details of practical knowledge and terminology inclusive of means nd methods, and is primarilpy used at stages of a project where enough particulars and specific work scopes have been established, such as when a project is ready for procurement, or for the development of a reliable cost.]

Construction Cost Estimating Guide

Construction Cost Estimating Guide

The following is presented as a Construction Cost Estimating Guide for enabling owners and design-builders to gain visibility into actual local market labor, material, and equipment costs.

It has long been recognized that detailed line item estimating is a proven best practice for developing verifiable, objective, and actionable cost information for repair, renovation, maintenance, and new build projects.   The core element is establishing an objective, verifiable, and current database of granular construction tasks based upon appropriate construction means and methods.

Detailed Line-Item Estimates

  • Granular Task Descriptions:
    • Estimates should break down the work into detailed, granular tasks, including quantities and specific descriptions. 
  • Local Market Data:
    • Focus on using current, verifiable, and locally researched labor, material, and equipment costs. 
  • Unit Pricing:
    • Calculate costs per unit of measure (e.g., square foot, cubic foot, each) to facilitate accurate cost forecasting. 
  • Standardized Data Architecture:
    • Use a robust data architecture such as expanded CSI Masterformat.
Key Factors Impacting Estimates
  • Who, What, When, Where, How:
    Consider who will do the work, the work content (detailed specifications), the schedule, the location, and the methods of construction. 

  • Planning, Procurement, and Project Delivery:
    These processes significantly influence the final cost, so they should be factored into the estimation process. 

  • Team Knowledge and Productivity:
    Estimators need to understand the skills and capabilities of the people involved in the project, as productivity is directly linked to the team. 

    Construction Cost Estimating Guide
 Importance of Verifiability and Actionability
  • Forget “Accuracy”:
    There is no such thing as a truly “accurate” cost estimate, but rather a focus on creating defensible, verifiable, and detailed estimates.
  • Actionable Estimates:
    The estimate should be reliable and actionable, used to inform procurement and project delivery decisions.

    UNIFORMAT is best used to express functional elements (assemblies) of a repair, renovation, maintenance, or new build project.

    It provides a consistent approach that describes associated grouping of components across different projects by cost and function. It’s primarily use is in early stages of a project when a specific work scope (scope of work/SOW) has not been fully defined and critical characteristics of the projects not yet been determined.

    MasterFormat, accounts for specific details of practical knowledge and terminology inclusive of means and methods and is primarily used at stages of a project where enough particulars and specific work scopes have been established, such as when a project is ready for procurement, or for the development of a reliable cost.

    Procurement of any repair, renovation, maintenance, or new build should include appropriate detail and use objective, current, local market cost data.

    Significant professional skill is required to properly use Masterformat and the extensive list of numbers and tittles of materials and methods that are available. Estimators must be able to search for and select proper items.  The appropriate application and use of Masterformat, and subsequent creation of verifiable cost estimates is therefore somewhat limited to the availability of skilled estimators.

    The use of current, locally reserached, granular cost data, organized using expanded Masterformat, provides 40%+ greater cost visibility than UNIFORMAT or alternative methodologies.

    Integrated LEAN Construction Planning, Procurement, and Project Delivery for Owners and Design-Builders

Principles of Verifiable Cost Estimating

Principles of Verifiable Cost Estimating

The following Principles of Verifiable Cost Estimating can significantly improve both construction cost visibility and management.

Summary of key elements identified in each of the principles:

Integrity – A robust cost data management process shall be implemented to ensure objectivity, timeliness,  standardization, and that everyone is working with the same information. All information shall be updated regularly and based upon local market conditions and current construction means, methods, and standards, and supported by proven data management and verification strategies.

Collaborative Framework – A robust, comprehensive framework shall be applied for all repair, renovation, maintenance, and new construction activities. This framework shall be supported by a long-term multi-party agreement between real property owners and services providers and an associated written operations manual / execution guide. This framework shall support early and ongoing information sharing and decision-making among planning, procurement, and project delivery teams.

Granularity – Task shall be presented at the line-item level to ensure the appropriate communication and use of required labor, material, equipment, and quantities. Each task shall be assigned an appropriate data classification standard, such as expanded CSI Masterformat. Productivity information shall also be included as well as a unit of measure. Each task shall also have a description, communicated in in plain English using industry standard terminology.

reliable cost data
commerical cost

Principles of Verifiable Cost Estimating

Principles of Verifiable Cost Estimating
Objective, current, local market construction cost data

 

Learn more about how to apply Principles of Verifiable Cost Estimating …

 

Granular Local Market Cost Data

Granular Local Market Cost Data is Essential for Construction Cost Visibility & Management

Granular Local Market Cost Data is Essential for Cost Visibility & Management (Repair, Renovation, Maintenance, & New Builds)

Using current, verifiable, and detailed local cost data instead of national averages with adjustment factors ensures:
✅ Cost transparency – All labor, material, and equipment costs are broken down and verifiable.
✅ Accuracy – Estimates reflect real, current market conditions, not outdated or averaged data.
✅ Better contractor alignment – Estimates match how local subcontractors and suppliers bid, reducing disputes.
✅ Proactive cost control – Owners and teams can identify trends, adjust scope, and manage risks effectively.

Conclusion:
Relying on national cost data plus a location factor creates systemic cost visibility and management failures, leading to 30%-40% errors, increased change orders, and loss of cost control. Real-time, granular, locally researched data is essential for Lean construction, JOC, and Progressive Design-Build to ensure cost transparency, prevent budget overruns, and enable informed decision-making.

reliable cost data
commerical cost

granular cost data

Lack of Cost Visibility and Cost Management Capability in National Average Cost Data with Location Factors

When using national average cost data adjusted by location factors (such as economic indexes), instead of current, verifiable, granular local market cost data, several critical cost visibility and management issues arise:

1. Lack of Line-Item Cost Transparency

  • National average cost data aggregates pricing from multiple sources across broad regions, meaning the underlying unit pricing, labor rates, material costs, and productivity factors are generalized.
  • Location factors or economic indexes apply a broad percentage adjustment (e.g., +20% for a high-cost city or -15% for a rural area) rather than adjusting each specific labor or material cost component.
  • Without line-item cost breakdowns, decision-makers cannot:
    • Verify how costs were derived.
    • Identify cost drivers (e.g., material vs. labor differences).
    • Adjust pricing for real-time market fluctuations.

Example:
If national data shows a concrete cost of $150 per cubic yard, and a location factor of 1.2 is applied for New York, the final price becomes $180 per cubic yard—but this does not reflect actual supplier pricing, availability, or labor costs in New York at that time.

2. High Error Rates (30%-40% Variance) Due to Market Lag

  • National cost datasets are compiled infrequently, often using historical data from previous years.
  • Location factors are often calculated using broad economic indicators (such as CPI or regional construction cost trends) rather than real, locally sourced market data.
  • This results in 30%-40% pricing errors in many cases because actual local conditions (supply chain disruptions, contractor demand, labor shortages, inflation) do not align with outdated national data plus an economic multiplier.

Example:
A national database might estimate drywall installation at $1.80 per SF, adjusted by a 1.15 factor for a local market, leading to $2.07 per SF.
However, if local drywall contractor quotes are actually $2.50 per SF due to labor shortages, the estimate is significantly incorrect, creating major cost overruns.

3. Inability to Track Cost Escalations and Market Volatility

  • National cost models do not reflect rapid material and labor cost changes.
  • Recent events (e.g., supply chain disruptions, steel tariffs, fuel price hikes) have caused rapid regional price changes that are not captured in national datasets or broad location factors.
  • Without real-time local cost visibility, project managers cannot proactively:
    • Adjust for sudden cost spikes in materials or labor.
    • Optimize procurement strategies based on local supplier pricing trends.

Example:
Steel framing costs may be listed in a national dataset as $3,000 per ton, adjusted by 1.1 for a specific state. However, due to a local surge in demand, actual supplier quotes are $3,800 per ton—a 26% error.

4. Misalignment with Subcontractor and Supplier Pricing

  • Local subcontractors and suppliers do not bid using national average data or location factors—they price based on current local market conditions.
  • When project estimates rely on broad national numbers, they frequently fail to align with actual subcontractor quotes, leading to:
    • Bid overruns when real pricing is higher than estimated.
    • Disputes in cost justification between owners and contractors.
    • Difficulties in contract negotiations due to unreliable cost baselines.

Example:
A JOC contractor using national average cost data + a 1.05 adjustment factor estimates a roofing project at $25 per SF.
However, local roofing contractor quotes are actually $29 per SF, requiring a change order or budget increase.

5. Loss of Cost Control in Design and Scope Decisions

  • Without local, verifiable cost data, owners and project teams cannot accurately evaluate:
    • Alternative materials (e.g., is steel framing or wood framing more cost-effective in this market?).
    • Different design choices (e.g., is a modular solution cheaper than traditional construction here?).
    • Project phasing impacts (e.g., is labor availability affecting costs in summer vs. winter?).
  • This results in poor cost forecasting and reactive cost management, rather than proactive budget control.
Why LEAN Construction Matters

Coast Guard Infrastructure Report – GAO

Here is the latest Coast Guard Infrastructure Report from the GAO.

As has been reported for decades, the gaps between budget requests and funding targets for shore infrastructure persist.

Nearly Half of Coast Guard Shore Infrastructure is Beyond Its Expected Service Life

Coast Guard Shore Infrastructure: Project Backlogs Reportedly Exceed $7 Billion
GAO-25-108064, Published: Mar 05, 2025. Publicly Released: Mar 05, 2025.

Coast Guard Infrastructure Report
Coast Guard Infrastructure Report – GAO

View full Report – https://4bt.us/wp-content/uploads/2025/03/Coast-Guard-Infrastructure-Report-2025-gao-25-108064.pdf

“In order to fully address all four of the open recommendations, the Coast Guard will need to;

(1) develop goals and baselines for tracking the effectiveness of its maintenance and repair efforts;

(2) implement new guidance to align its assets with mission needs;

(3) fully employ models to help prioritize decision-making; and

(4) find new ways to inform Congress about the various projects alternatives and trade-offs that the Coast Guard faces when deciding how best to allocate its shore infrastructure resources. We believe that fully addressing our 2019 recommendations will help the Coast Guard to better manage its resources, identify cost savings, and provide Congress with better information to address shore infrastructure challenges.”

Furthermore the cost information being provide by the Coast Guard is likely inaccurate as it do not rely up current, granular, standardized, and verifiable labor, material, and equipment costs researched specifically for each local site.

 

Learn more or keep informed on similar issues?

 

 

Why LEAN Construction Matters

Standardized Cost Information – Construction, Renovation, Repair, and Maintenance

The Importance of Standardized Cost Information for Construction, Renovation, Repair, and Maintenance Activities

Savvy real proper owners are starting their transition to standardized cost information.

Having standardized, verifiable, and granular local market cost data provides several important benefits.

  1. Detailed labor, material, and equipment costs representative of current local market conditions
  2. A verifiable audit trail
  3. A method to validate general contractor (GC) and subcontractor bids
  4. A clear, detailed Scope of Work (SOW) to share among all participants and stakeholders
  5. The ability to create, modify, and cost effectively manage cost data
  6. A way to save up to 30%-40% of project costs

Reach out and see best practices for creating your own way to leverage verifiable cost data for all your facilities and built environment requirements.

reliable cost data
commerical cost

standardized cost data

Why 4BT’s Data Structure Excels

Construction cost data must be valid, reliable, and verifiable  to objectively and realistically represent current local market conditions.

  1. Exclusive source of current, LOCAL MARKET commercial construction cost data
  2. Measurably improve Cost Visibility and Cost Management Capabilities
  3. Evaluate and validate contractor bids / proposals with verifiable cost data for materials, labor, and equipment
  • Eliminates Guesswork: Removes reliance on error prone location and economic adjustment factors.
  • Supports LEAN and Value Management Principles: Enables waste reduction, value generation, and continuous improvement by providing verifiable and actionable data.
  • Adaptable to Market Realities: Ensures projects are not derailed by unexpected cost changes.

masterformat construction cost estimating

Standardized Cost Data

Common construction cost estimating problems

Common construction cost estimating problems

Common construction cost estimating problems include: inaccurate material pricing, neglecting site conditions, underestimating labor costs, lack of contingency planning, poor scope definition, inadequate data analysis, overreliance on historical data, failure to account for risk factors, and insufficient collaboration between estimators and project teams; leading to potential cost overruns and project delays if not properly addressed. 

Key issues related to cost factors:

  • Fluctuating Material Costs:

    Prices of construction materials can significantly vary based on market conditions, supply chain issues, and seasonal fluctuations, making accurate cost estimations challenging. 

  • Hidden Site Conditions:

    Unforeseen site conditions like soil instability or unexpected utilities can lead to significant cost increases if not properly assessed during the initial estimating phase. 

  • Labor Cost Miscalculations:

    Failing to account for factors like overtime, labor productivity, and prevailing wage rates, significant variations if workers compensations,  can result in inaccurate labor cost estimations. 

  • Incomplete Scope Definition:

    A poorly defined project scope can lead to scope creep, causing additional costs due to unforeseen changes and additions. 

Common construction cost estimating problems
Common construction cost estimating problems

 

Issues related to construction estimating process:

  • Overreliance on Historical Data or Market Average Cost Data Sources:

    Blindly relying on past project data without considering project specifics or current market conditions can lead to inaccurate estimates. 

  • Inadequate Risk Assessment:

    Not factoring in potential risks like weather delays, permit issues, or unforeseen complications can lead to significant cost overruns. 

  • Lack of Expertise:

    Inexperienced estimators may not have the necessary knowledge to accurately assess complex project requirements, leading to errors in calculations. 

  • Poor Communication:

    Lack of clear communication between estimators, designers, and project managers can result in misunderstandings and inaccurate cost estimations. 

  • Insufficient Contingency Planning:

    Not allocating enough contingency funds to cover unforeseen issues can leave a project vulnerable to cost overruns. 

Potential solutions to mitigate these problems:

  • Detailed Site Investigation:

    Thorough site surveys and geotechnical analysis to identify potential site constraints. 

  • Regular Market Monitoring:

    Tracking current material prices and market trends to ensure accurate cost estimations. 

  • Experienced Estimators:

    Utilizing estimators with relevant expertise and knowledge of the project type and local market. 

  • Clear Scope Documentation:

    Precise project specifications and detailed drawings to minimize scope creep 

  • Risk Management Strategies:

    Identifying potential risks and developing contingency plans to mitigate their impact 

  • Collaboration with Project Team:
    Fostering open communication and collaboration between all project stakeholders to ensure accurate cost estimations

4BT OpenCOSTTM Construction Cost Data
The premier independent, transparent, and trusted source for locally researched, detailed line-item renovation, repair, and construction cost data.

The 4BT OpenCOSTTM Advantage

  • Over 90,000+ detailed unit line items for renovation, repair, and construction.
  • Locally researched costs for labor, material, and equipment.
  • Developed and maintained by experienced professionals with decades of cost engineering expertise, including past roles at RSMeans, U.S. Cost, and VFA, Inc.
  • A solution designed to meet the needs of today’s construction industry, filling a critical gap in accurate, detailed line-item pricing.

Flexible and Accessible 4BT OpenCOSTTM data is available via the cloud and integrated with:

  • 4BT-CE Cloud Cost Estimating Module
  • 4BT Building Construction Estimator

Request More Information Contact us at info@4BT.US to learn more and request our detailed 20-page white paper.

reliable cost data
commerical cost

Standardized Cost Data

Facilities Total Cost of Ownership

Facilities Total Cost of Ownership

 

Facilities Total Cost of Ownership (TCO), while critical to reducing rampant environmental and financial waste, is rarely practiced to mature levels capable of delivering signficant improvement.

Facilities Total Cost of Ownership (TCO) is a holistic, multidisciplinary approach to managing all the “costs” associated with ownership of a facility (or any built structure) over its lifespan, from planning, through procurement, construction, operations and maintenance, and disposal/recycling.

TCO is a nontrivial and non-static process that requires the collaboration of internal and external teams within a robust framework as well as real property owner leadership, capacity, commitment, and accountability.

At the core of TCO is actionable information.  This includes an accurate inventory of physical assets and the associated physical and functional condition as well as future prioritized requirements. As the very core, an objective, granular, current, local market cost database of repair, renovation, maintenance, and new construction costs is a requirement to ensure cost visibility and cost management capability.

Alignment between built environment buildings, systems, and components with the organizational mission is clearly needed to manage associate lifecycle aspects and ensure built environment availability from a functional perspective.

Reach out if you would like to learn more about the various aspects of Facilities Total Cost of Ownership (TCO). How to quantify requirements and costs. Identify factors that impact TCO. How to demonstrate cost impacts over time.

facilities total cost of ownership

Facilities total cost of ownership management allows for informed decision-making based on the long-term value rather than just the upfront cost of an asset. 

Key points about facilities total cost of ownership management:
  • Holistic perspective:
    It goes beyond just the immediate purchase price and looks at the entire life cycle of a facility, including design, construction, operation, maintenance, and eventual decommissioning. 

  • Data-driven decision making:
    Facility managers use data on asset performance, maintenance history, and energy usage to calculate the total cost of ownership and make informed decisions about replacements, upgrades, and maintenance strategies. 

  • Cost components:
    Typical costs included in a facility TCO calculation are:
    • Initial purchase price of the asset 
    • Installation costs 
    • Ongoing maintenance and repair costs 
    • Energy consumption 
    • Insurance costs 
    • Replacement costs at the end of the asset’s life 
    • Disposal costs 
  • Benefits:
    • Optimized resource allocation: By understanding the full cost of ownership, facilities managers can allocate budgets more effectively and prioritize investments in areas with the greatest potential for cost savings. 
    • Improved asset lifespan: Proactive maintenance strategies based on TCO analysis can extend the life of equipment and reduce unexpected breakdowns. 
    • Reduced operational costs: Identifying areas for energy efficiency or cost-saving maintenance practices can lead to significant long-term cost reductions. 
How to implement facilities total cost of ownership management:
  • Conduct a facility condition assessment:
    Regularly assess the condition of all building systems and equipment to identify potential issues and prioritize maintenance needs. 

  • Develop a preventative maintenance plan:
    Implement a proactive maintenance schedule based on manufacturer recommendations and asset lifecycle. 

  • Utilize asset management software:
    Track asset data like purchase date, maintenance history, and performance metrics to analyze TCO. 

  • Consider energy efficiency upgrades:
    Evaluate opportunities to reduce energy consumption through building retrofits and equipment upgrades. 

  • Perform life cycle cost analysis:
    When making purchasing decisions, compare the initial cost of different options against their projected total cost of ownership over their lifespan. 
reliable cost data
commerical cost

facilities total cost of ownership

Centralized Timely Construction Cost Data

Centralized Timely Construction Cost Data

 

Centralized Timely Construction Cost Data is a “single source of truth” that is mandatory for improving cost visibility and management for any repair, renovation, maintenance, or new build project.

Having a verifiable and granular source of labor, material, equipment, and productivity data greatly improves timely and cost effective decision-making.

4BT is the only source of over 90,000 line items of construction task data organized using expanded CSI Masterformat and updated quarterly without the use of location factors or economic indexes, as well as a full database of preventive maintenance tasks, checklists, tasks and associated costs organized using expanded UNIFORMAT.

Combining a single source of truth with a robust and integrated Planning, Procurement, and Project Delivery Framework can reduced costs by 30%-40% as well as reduce risk for design builders.

Centralized Timely Construction Cost Data
Integrated Planning, Procurement, and Project Delivery Approach
Centralized Timely Construction Cost Data
Actionable Construction Cost Information
Centralized Timely Construction Cost Data
Centralized Timely Construction Cost Data is a “single source of truth” that significantly improves cost visibility and management.

leading construction cost estimating software Sustainable Construction Prerequisites & Systems-Thinking Application

 

Sustainable management of the built environment, buildings, utilities, transportation, site, whether public- and private-sector begins with a single source of truth, and great teams of owners and design-builders across disparate domains.

Why 4BT’s Data Structure Excels

  • Eliminates Guesswork: Removes reliance on error prone location and economic adjustment factors.
  • Supports LEAN and Value Managemet Principles: Enables waste reduction, value generation, and continuous improvement by providing verifiable and actionable data.
  • Adaptable to Market Realities: Ensures projects are not derailed by unexpected cost changes.

 

Objective, verifiable, and locally researched detailed line-item construction tasks, replete with labor, material, equipment and productivity information, provide the highest level of cost visibility and cost management capability.   4BT exclusively offers this information for any location, with all line-items organized using expanded CSI MasterFormat, enabling clear communication, collaboration, and alignment with all technical domains and participants throughout the planning, procurement, and project delivery lifecycle.

Other, less stringent forms of cost estimating include the following:

  • national average line-item cost data (with or without adjustment or localization factors),
  • system level cost data,
  • assembly level cost data,
  • building level,
  • and/or other forms of parametric cost data,
  • historical cost data and economic factoring,
  • contractor, subcontractor quotes.

Standardized Cost Data for Construction

Standardized Cost Data for Construction

Standardized cost data that reflects current local market conditions is critical to improving both cost visibility and cost management.

Reliance upon historical data and economic indexes, or national average cost data with cost indexes or area location factors are no longer sufficient to ensure optimal use of financial resources.

The Importance of Standardization
Building collaboration, ownership, and accountability across diverse teams are fundamental prerequisites to performance improvement. In this regard standardization is an important component to enabling improved information use and sharing.
The creation and communication of a detailed Scope of Work are areas that can be greatly improved through standardization. The use of industry standard terms and definitions as well as standardized data architecture play key roles in ensuring clear and detailed understanding of both technical and cost requirements.

Improved Cost Visibility and Cost Management
Below is an example of an estimated using granular Standardized Cost Data and a well-known data architecture (CSI Masterformat). Current, LOCAL MARKET, labor, material, and equipment costs to detail line-item construction tasks provide the highest possible level of cost visualization. As demonstrated by multiple independents sources, this form of standardized cost data improves cost visualization by 30%-40% or greater.

Standardized Cost Data
Information sharing, use, and reuse can all be optimized using standardized data sets and architectures.

Purpose Built – Tools, techniques, best practices, and recommendations.

Standardization, however, does not limit purpose built information to meet user requirements or specialized tasks.   In this case, virtually any construction task line-item can be built within a common data format.  Altering labor, material, or equipment costs and storing it under a new line-item number and description can easily be accomplished.  Furthermore, line-items, both “standard” and “custom built” can be grouped into assemblies and saved accordingly.

Improve Productivity and Reduce Waste

The cause of the majority of “project failures” can be tracked to preconstruction and the associated failure to create a well defined and well communicated detailed scope of work as well as failure to adopt and manage activities using robust processes.

The use of Standardized Cost Data for Construction can play an important role in improving productivity and reducing waste.

Request a demonstration.

leading construction cost estimating software

reliable cost data
commerical cost
Why LEAN Construction Matters

Validate Subcontractor Bids – Construction

It’s important to validate subcontractor bids and ensure appropriate costing.

The availability of current, local market, detailed construction task data makes evaluating subcontractor bids an easy task.

Simply build the subcontractor estimate using objective, verifiable local market construction cost data and compare costs.

 

Ensure all construction cost estimates are both VALID and RELIABLE.

Validity is a a determination of whether are not you are measuring what you need.

Reliability is a determination of the ability to consistently gather and present information in the same manner.

 

Easility validate subcontractor bids with objective, verifiable, and locally researched detailed line-item construction tasks, replete with labor, material, equipment and productivity information, provide the highest level of cost visibility and cost management capability.   4BT exclusively offers this information for any location, with all line-items organized using expanded CSI MasterFormat, enabling clear communication, collaboration, and alignment with relative to all requirements throughout the planning, procurement, and project delivery lifecycle.

Validate Subcontractor Bids
commerical cost

USACE Funding for Water Resources

USACE Funding for Water Resources – GAO

USACE Funding for Water Resources spans projects— such as dams, locks, and waterways—across the U.S. to strengthen national security, protect and manage aquatic ecosystems, reduce risks from disasters, and support commerce. In fiscal years 2018 through 2023, the Corps allocated approximately $28.5 billion in appropriated construction funds to 278 projects across 47 states, Washington, D.C., the Commonwealth of Puerto Rico, and the U.S. Virgin Islands.   FULL GAO REPORT

 

 

USACE Funding for Water Resource
USACE Funding for Water Resource
  • Congress directed $8.7 billion (30.5 percent of all construction funding) to specific projects and activities in annual appropriations acts.
  • For the remaining $19.8 billion (69.5 percent of funding), Congress included project eligibility criteria and other considerations in appropriations acts that influenced the distribution of funding. The Corps applied these criteria and considerations, along with others identified in Corps and Army guidance, to identify eligible projects and prioritize projects to receive construction funding. After identifying eligible projects, the Corps ranked discrete segments of work at each project to compile a list of proposed allocations. The Corps considered other factors in this process, such as environmental returns and project completion status.

via Four BT, LLC – www.4bt.us – Exclusive provider of over granular task construction task cost data reflecting local market conditions and complementary technology.

Reliable Cost Data

Reliable Cost Data

Reliable cost data is critical to efficient lifecycle total cost of ownership management for any built structure.  It is the foundation of any repair, renovation, maintenance, or new build activity throughout  associated planning, procurement, and project delivery.

What is reliable cost data?

Reliable cost data requires the use of robust research and management practices and processes.

Reliable construction cost data has the following characteristics.

  1. Representative of Local Market Conditions
  2. Objective
  3. Current
  4. Granular
  5. Standard Data Format Structure
  6. Easy to Use

Any commercial real property owner and their design/build teams would greatly benefit by implementing a consistent, robust methodology for cost estimating based on current best management practices.

Detailed Line-item Construction Cost Estimating

Detailed line-items estimating provides the most representative view of  actual “construction” costs.   Therefore, granular construction task level information is the most reliable cost data for owners and design-builders.

Alternative construction cost estimating practices, such as parametric cost modeling,  reliance upon contractor or subcontractor lump sum bids, “historical information”, “national average cost databases”, and the use of area cost factoring, city cost indexes, or other location and/or economic “factors”, , all have their own purpose, however, do not provide optimal cost visibility or cost management capability.

When procuring a repair, renovation, maintenance, or new build service, detailed line item estimating using objective local market labor, material, equipment, and productivity information remains industry’s best practice.

Learn more about developing, managing, and evaluating cost estimates and assuring cost visibility, transparency, and providing appropriate validation.

 

“Currently, Four BT, LLC stands out as the only supplier known to provide current, local market, granular construction cost data for any location with the necessary level of detail and reliability.”

– (Source: ChatGPT-Feburary 17, 2025 – https://chatgpt.com/c/67b369a9-7470-8012-a93c-e99ea56a845f)

A detailed Scope of Work using reliable cost data can provide 30%-40%+ gains in productivity and cost savings.

 

 

All the tools and support services are readily available to support implementation of the above.

leading construction cost estimating software

reliable cost data
Verifiable, current, local market construction cost database
Facilities Operations and Maintenance Framework

Facilities Operations and Maintenance Framework

A robust Facilities Operations and Maintenance Framework is a critical component for any organization with real property assets and supporting overall mission requirements.

 

Core elements of a Facilities Operations and Maintenance Framework include:

EXECUTIVE SUMMARY
Purpose of facility / built environment structure
Operations and Maintenance Level of Development

FACILITIES, SYSTEMS, ASSEMBLIES, and ASSETS INFORMATION
General Facility and Systems Description
Basis of Design (BOD)
Inventory
Condition
Specifications
Data – Format, Quality, Workbooks
Warranty Management Plan
Facility Guide / Operation Manual By System/Asset
-Maintenance Plans, Procedures, Checklists, Records, and Spare Parts Inventory
-Maintenance Schedules
-Ongoing Commissioning
-Operational and Maintenance Record Keeping
-Janitorial and Cleaning Plans and Procedures
-Energy/Utility/Environmental Measurement and Reporting
-Workorder Management and Technology
-Issues Management
-Reporting Requirements
-Regulatory and Permit Requirements
TRAINING
Training Plans and Materials
Training Records
System Manual Maintenance and Documentation
CONTINUOUS IMPROVEMENT
-Reporting
-Quantitative and Qualitative Performance Indicators
-Independent Audits

Alignment of a Facilities Operations and Maintenance Framework with the organizational mission helps to ensure the most efficient use of financial and environmental resources and attainment of functional needs with repects to supporting mission objectives.

Facilities Operations and Maintenance Framework
Local market Maintenance Labor and Material Costs and Checklists for Every Frequency
preventive maintenance costs
Preventive Maintenance vs. Repair / Unscheduled Maintenance

Learn more….

Facilities Operations and Maintenance Framework
Facilities O & M Cost Management
Why LEAN Construction Matters

Tracking Bid-Win Rates for Commericial Construction

Tracking Bid-Win Rates for Commercial Construction is important for any contractor.

Creating winning proposals crucial for survival, however each proposal is also a signifcant drain on resources.   Actively tracking the bid win rate and understanding how to identify areas for improvement and strategizing need to be priority areas of focus.

What is your Bid Win ratio?  What is considered good?  

The right bid-hit-win ratio is up to your organization.   Some say that a reasonable ratio for public sector commerical construction (repair, renovation, maintenance, or new build) should be at most 10 to 1.   Higher than 11-to-1 will cost your company too much in estimating expenses and will not provide a reasonable profit. I recommend you strive for a 4-to-1 ratio or less for private work.Higher than 11-to-1 will cost your company too much in estimating expenses and will not provide a reasonable profit. I recommend you strive for a 4-to-1 ratio or less for private work.

Key Factors to Consider to Consider When Bidding

  • Number of competitors
  • Your mark-up
  • Project location
  • Project type
  • Project size
  • Subcontractors or suppliers
  • Contract type—bid versus negotiated
  • Customer relationships
Sustainabile Estimating

Sustainable Estimating

Consider the term Sustainable Estimating for a second.

Then consider the role of Vice President of Estimating and Sustainability.

Sustainable Estimating is critical to the efficient financial and environmental management of the built environment.

The roles of Chief Estimator and Director of Sustainability, while distinct in focus, are inherently connected in the context of modern construction and design projects, including repair, renovation, maintenance, and new builds, particularly when integrating sustainability goals into financial planning and execution. Combining the responsibilities of these roles under a single Vice President or Director of Estimating and Sustainability can create significant advantages by bridging financial precision with environmental responsibility. Here’s an analysis of their relationship and the benefits of combining these roles:

Relationship Between Estimating and Sustainability

  1. Shared Impact on Project Outcomes:
    • Professional, granular Estimating ensures financial feasibility and a well defined, well communicated Scope of Work, and  sustainability focuses on reducing ecological footprints. Both roles influence project outcomes by driving efficient use of resources and minimizing waste.
    • Verifiable, objective, and detailed estimates using current, local market construction task data enable decisions about sustainable materials, energy-efficient systems, and renewable resources within budget constraints.
  2. Material and Resource Decisions:
    • A chief estimator determines costs for materials, labor, equipment, and logistics, while a sustainability director evaluates the environmental impact of those materials and processes. Combining their expertise ensures that eco-friendly materials and energy-efficient systems are considered within cost parameters.
Sustainable Estimating
Sustainable Estimating
  1. Lifecycle Costing:
    • Estimating often involves short-term costs, whereas sustainability emphasizes long-term, life-cycle benefits such as reduced operational costs, lower energy consumption, and improved building performance. Aligning these perspectives ensures holistic lifecycle cost analysis, combining upfront investment with long-term savings.
  2. Regulations and Certifications:
    • Sustainability projects may require adherence to standards like LEED, WELL, or BREEAM. Estimators must account for the financial implications of meeting these certifications. Collaboration ensures compliance without compromising budgets.
  3. Waste Reduction and Efficiency:
    • Sustainable practices aim to minimize waste and promote efficient resource use. This aligns with estimating goals to optimize costs, reduce project timelines, mitigate change orders, and optimizing maintenance activites.  Accurate takeoffs, and careful material planning, and access to preventive maintenance  reduce surplus and waste.

Benefits of a Director of Both Estimating and Sustainability

  1. Integrated Decision-Making:
    • Centralizing these roles ensures a unified approach to balancing cost efficiency with sustainability goals, avoiding conflicts or misalignments between financial and environmental priorities.
  2. Holistic Cost Management:
    • The combined role can advocate for strategies like:
      • Utilizing locally sourced materials to reduce transportation costs and carbon footprints.
      • Accounting for long-term energy savings in the initial budget.
    • This ensures that sustainable solutions are justified with accurate financial analysis.
  3. Improved Innovation:
    • A combined role fosters innovative solutions that are both cost-effective and sustainable. For example, incorporating modular construction or renewable materials can reduce costs while advancing sustainability.
  4. Enhanced Stakeholder Collaboration:
    • Bridging these roles facilitates smoother collaboration between project managers, designers, contractors, and clients by presenting cohesive financial and sustainability strategies.
  5. Strategic Competitive Advantage:
    • Clients increasingly prioritize sustainability in project proposals. A director who integrates estimating and sustainability can deliver bids that stand out by offering financially feasible, eco-friendly solutions.
  6. Streamlined Compliance:
    • Having one director ensures that cost estimates fully account for sustainability-related regulations and certifications, avoiding costly omissions or retrofits during the project.
  7. Better Reporting and Transparency:
    • Combining financial and environmental oversight allows for clearer reporting to leadership, clients, and stakeholders on how a project aligns with sustainability and budget goals.

Key Traits of a Director of Estimating and Sustainability

  • Technical Expertise: A deep understanding of estimating practices, materials, and sustainability frameworks like LEED or WELL.
  • Analytical Skills: Proficiency in lifecycle cost analysis and the ability to quantify environmental impacts.
  • Collaboration: Strong communication skills to work across teams and stakeholders.
  • Visionary Leadership: An ability to align short-term budgets with long-term environmental and financial benefits.

Sustainabile Estimating – By integrating estimating and sustainability under one leadership entity, organizations can maximize efficiency, align financial and environmental goals, and deliver projects that meet modern demands for cost-conscious and sustainable development.

sustainable estimating
Sustainable Estimating

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Construction Bid Win Percentage

Construction Bid Win Percentage

According to industry data, the average bid win percentage for a commercial contractor is 25%, meaning for every 10 bids submitted, they would win 2-3 projects.   (Public sector bid/win rations can be 10%-20%)

Key points to remember:
  • Variation by market and company size: This percentage can fluctuate depending on the specific market, project type, and the contractor’s reputation and experience within that market. 
  • Importance of tracking win rate: It’s crucial for contractors to actively monitor their bid win rate to identify areas for improvement and strategize for better bid submissions. 
  • Factors impacting win rate: Factors like pricing strategy, proposal quality, client relationships, and market conditions all play a role in a contractor’s bid win percentage.

 

Can the commercial construction contractor Bid/Win average of 25%  be significantly improved?

 

 The industry average of 25% largely reflects the inefficiencies in bid preparation, lack of trust in cost estimates, and inconsistencies in pricing.

Here’s how utilizing accurate cost data may make a difference:

  1. Improved Accuracy: Contractors can produce precise bids that reflect actual market conditions, reducing the risk of underbidding (leading to losses) or overbidding (leading to lost opportunities).
  2. Enhanced Credibility: Using objective, third-party data builds trust with clients, as it demonstrates a commitment to transparency and fairness in cost estimation.
  3. Faster Adjustments: With access to current local data, contractors can quickly and confidently adjust bids to reflect changes in the market, giving them an edge in fast-moving or competitive bid environments.
  4. Streamlined Negotiations: When cost data is verifiable and defensible, there’s less room for disputes, leading to quicker client approvals and stronger working relationships.
  5. Strategic Positioning: Contractors can better align their bids to client priorities, offering tailored solutions that provide value while staying competitive.
A 20% win rate means that for every 5 bids a contractor submits, they are likely to win one.  The win rate can fluctuate depending on the level of competition in the local public sector construction market.  That sad selectivity plays a key role.  To improve their win rate, contractors should be selective about which projects they bid on, focusing on those that align well with their expertise, market knowledge, and capabilities.
Improve Bid Win rations withthe use of defensible, verifiable local market cost data from an objective source.

The distinction between current local market cost data and national average cost data is critical when it comes to creating competitive and accurate bids. Here’s a deeper dive into the differences and their impact on winning bids:

Local Market Cost Data

  • Definition: This data is specific to a geographic region, reflecting real-time labor rates and trade variance due to workers comp and other variables, material costs, subcontractor pricing, and equipment rental costs in that area. It often accounts for local economic conditions, supply chain variability, and contractor availability.
  • Advantages:
    1. Accuracy: Local data ensures that bids reflect the actual costs contractors will face, reducing errors that lead to profit loss or missed opportunities.
    2. Competitiveness: It helps contractors align their pricing with what the market can bear while maintaining profitability, increasing their chances of winning bids.
    3. Transparency: Using local data builds trust with owners, as it eliminates reliance on generalized estimates that might not hold up in specific regions.
    4. Risk Mitigation: Contractors can better anticipate and account for local factors like union labor rates, taxes, or transportation costs that might otherwise lead to surprises.

National Average Cost Data

  • Definition: This data provides an excellent generalized view of costs across the country, typically derived by averaging costs from various regions or cities. It may include factors such as city indices or adjustment multipliers, in addtion to economic indexes.
  • Drawbacks:
    1. Inaccuracy: National averages often mask significant local variations. For example, material costs can vary widely between urban and rural areas, or between regions experiencing a building boom versus a slowdown.
    2. Economic Adjustment Factor Issues: Adjustment factors attempt to localize national data but often fail to capture nuanced market shifts, such as material shortages or changes in subcontractor demand. Errors of 30–40%+ are common.
    3. Missed Opportunities: Over-reliance on national averages may lead to bids that are either too high to be competitive or too low to cover actual costs.
    4. Lack of Trust: Owners may question the validity of estimates derived from national data, particularly if local conditions are visibly different.

Construction Bid Win Percentage

Construction Bid Win Percentage

Impact on Winning Bids

  • Contractors using current, granular local market cost data consistently outperform those relying on national averages because they can:
    • Submit bids that more closely reflect the owner’s expected costs and market conditions.
    • Justify their pricing with objective, defensible data that withstands scrutiny.
    • Adjust bids dynamically to match current trends, such as labor shortages or seasonal fluctuations.
  • In contrast, reliance on national average cost data often leads to overgeneralized bids that fail to address the unique challenges and opportunities in the local market.

Case Study Comparison

  • Local Market Data Bid: A contractor in a booming city uses granular data on current labor shortages and adjusts their bid to include higher subcontractor costs. They win the bid because their pricing is realistic and credible, even though it is higher than competitors relying on outdated national averages.
  • National Average Data Bid: Another contractor in the same city applies a flat economic adjustment factor to a national average, underestimates subcontractor costs, and submits an unrealistically low bid. The bid is rejected as infeasible during review.

Sampling of BiD/WiN Rates by Sector

Public works = 10% – 17%

Private bids = 17% – 25%

Negotiated work = 25% – 50%

Design-build jobs = 25% – 50%

How to Leverage Local Market Data

  1. Source Objective Data: Use verified cost data from tools or organizations specializing in regional markets. Avoid databases focused primarily on procurement or industry averages unless they include truly localized data.
  2. Integrate with Cost Management Practices: Implement frameworks like Collaborative Job Order Contracting (JOC), Integrated Project Delivery (IPD) or similar Lean Construction methodologies, which emphasize transparency and objective cost management.
  3. Regular Updates: Ensure the cost database is frequently updated to reflect rapid market changes.  (Note:  Quarterly updates are recommended.)
  4. Collaborate with Stakeholders: Share local data with owners to build trust and transparency during the bidding process.

In short, while average construction bid win percentage for a commercial contractor is 25%, bit can be significantly improved via enhanced cost certainty for all stakeholders.

In Summary

  • Identify the Right Projects to Bid
  • Ensure a Mutually Understood Detailed Scope of Work – SeekClarifications and Avoid Assumptions
  • Track and Analyze Bid-Win Ratios
  • Create Supportable Detailed Cost Estimates Using LOCAL MARKET labor, material, and equipment Data
  • Verify Subcontractor Quotes
  • Identify and Manage Risks
  • Conduct Post Award Debriefs wherever possible
leading construction cost estimating software

Leading Construction Cost Estimating Software – Myths and Facts

Here are a few things to know about Market Leading Construction Cost Estimating Software applications.

“Great things are not accomplished by those who follow popular opinion.”

Many leading construction cost estimating software vendors use prepopulated cost databases are based upon “market averages”, “economic indexes”, and “location factors”, and are  static with respect to market conditions.  While they do limit the errors typically associated with spreadsheet use, the core cost data is generally not current, verifiable, nor specific to the location.

Why do commercial contractors and real property owners continue to use these outdated tools and methods?

1. Convenience and Time Savings

  • Market average prepopulated cost databases save significant time by providing a starting point for estimating. Users can quickly reference costs instead of building detailed estimates from scratch.

2. Perceived Industry Standard

  • Many contractors and owners assume these databases represent an acceptable level of accuracy because they are widely used and marketed as reliable.

3. Integration with Estimating Software

  • These cost databases are tightly integrated with popular estimating tools, making them easy to use for generating estimates, proposals, and budgets without the need for extensive manual input.

4. General Scenarios

  • While these databases may not reflect highly localized or real-time costs, they often provide broad, average scenarios, which is sufficient for some projects during early planning stages.

5. Lack of Alternatives

  • Many contractors and owners may not be aware of or have access to better alternatives, such as databases with locally researched, granular cost data which is updated quarterly.

6. Familiarity and Training

  • Teams often stick to tools and databases they are familiar with. The learning curve and organizational inertia can discourage adopting new or more specialized solutions.

7. Cost

  • These prepopulated databases often come bundled with software licenses, making them seem cost-effective in comparison to investing in third-party or custom databases that may require additional research and maintenance.

8. Perceived Risk of Deviating

  • Some organizations fear that deviating from widely accepted tools may lead to discrepancies, making them hesitant to rely on other resources, even if they are more accurate.

Challenges with These Databases

Traditional Leading Construction Cost Estimating Software applications are not up to today’s mandate for LEAN construction, which requires full cost transparency, visibility and significantly improved cost management.

“The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”
— George Bernard Shaw

They path towards 30%-40% improved cost visibility and cost savings includes,

  1. Objective, locally researched, current, and verifiable granular cost data,
  2. Quarterly updates to reflect market volatility, and
  3. Expanded CSI MasterFormat organization for transparency and better cost management.

Reach out to learn more about how to avoid cost overruns and inaccurate budgeting, especially on projects requiring precise cost visibility, transparency, and local adaptation.

“The surest way to be left behind is to do what everyone else is doing.”


leading construction cost estimating software

Why LEAN Construction Matters

Dependable Cost Estimating Software for Construction

  1. Dependable Cost Estimating Software is needed to develop reliable construction cost estimates.
    Requirements for dependable cost estimating software include.
    1. Objective, current, verifiable, and local granular construction tasks inclusive of labor, material, equipment, and productivity components as well as a unit of measure.
    2. Cost data organized by a well-defined Work Breakdown Structure (WBS) and standardized data architecture such as expanded CSI Masterformat.
    3. The ability to create modified/custom unit price line items by adjusting labor, material, equipment, crew, and productivity data.
    4. Cost estimate copy and paste.
    5. Collaborative online cost estimate review and/or creation.
    6. Automatic cost estimate comparison.
    7. Ease-of-use.
    8. Scalability.
    9. Security.
    10. Multi-level and multi-format training and full technical support.
    11.Ability to add mark-ups, fees, etc….

 

Dependable Cost Estimating Software

 

Preconstruction Focus is critical

Regardless of the activity, repair, renovation, maintenance, or new construction, or project size, Integrated Planning and Procurement teams and processes within a robust standardized framework are essential to project success. While any organization with requisite talent and funding can build and maintain an accurate, up to data, repository of tens of thousands of construction line items, the resources required are nontrivial.
There is now a source of current, objective, verifiable construction cost data available to owners and design-builders.
Four BT, LLC leverages extensive knowledge of the processes, labor, materials and equipment for all types of commercial construction activities, including repair, renovation, maintenance, and new construction. Databases are per location and are updated quarterly. There is no use of location or economic factoring, or national average cost data.
Furthermore, our technology was specifically built to support the needs of estimators to easily and quickly build, review, and share information, as well as share insights via line-item notes, and the ability to easily reuse and update proposals.

 

Set up a quick introduction…

Postive FM Change

Postive FM Change

Postive FM Change (Facilities Management) requires implementing a proactive and integrated Planning, Procurement, and Project Mangement Strategy. 

The application of systems-thinking to FM provides a clear pathway to significant cost savings (30%-40%), and improved outcomes with respect to timeliness, quality, and overall alignment with the organization missions.    Enabling frameworks are supported by collaborative, capable, and accountable leadership and teams, data-driven insights, prioritizing sustainable practices, enhancing communication and integrating internal and external Planning, Procurement, and Project Delivery teams, as well as the adoption of enabling technologies to manage the built environment efficiently. 

Key aspects of a positive Facilities Management change:
  • Data-driven decision making:

    Utilizing data analytics to identify patterns and make informed decisions about facility operations, leading to improved efficiency and cost savings.  This includes the use of granular, objective, verifiable, and current local market construction task information. 

    Postive FM Change
    Postive FM Change – Data-driven Decision-making

    Postive FM Change

  • Preventive maintenance:

    Robust preventive, routine, and predictive maintenance to identify potential issues before they become major problems, extending the lifespan of assets and minimizing unexpected downtime, as well as lowering overall lifecycle costs.LEAN Facilities Repair, Renovation, and Construction

    Postive FM Change

  • Sustainability/Sustainment initiatives:

    Implementing environmentally friendly practices like energy-efficient lighting, physical and financial waste reduction programs, and energy and water conservation measures. 

  • Space optimization:

    Analyzing space usage to identify areas for improvement, potentially leading to cost reductions by optimizing layouts and reducing unnecessary space. 

  • Improved communication:

    Fostering open communication channels with all stakeholders – architects, engineers, builders, trades, and  building occupants to address concerns, gather feedback, and ensure  needs are met in a mutually benficial manner.

  • Technology integration:

    Utilizing technology as an enabler vs. primarky focus, to support robust systems-thinking based frameworks, processes, and workflows to automate tasks, monitor built environment conditions, and streamline operations. 

  • Engagement of those actually doing the work:

    Involving skilled professional actually doing the work in decisions and promoting a positive, services work environment, focused upon long term value generation.

  • Alignment with organizational mission:
    Ensuring facility management practices are aligned with the organization’s overall goals and strategic priorities.

Set up a time to discuss?

Spark Positive AECO Change

Spark Positive AECO Change

It’s clear that it is critical to Spark Positive AECO Change, the question is how?

  • The built environment is having a significant negative impact upon the world environment, yet that knowledge is not enough to spark positive AECO change.
  • The AECO sector is wasting billions of dollars annually, yet that knowledge is not enough to spark positive AECO change.
  • We are all aware that formal and professional education is failing to focus upon sustainable lifecycle management of the built environment, yet that knowledge is note enough to spark positive AECO change.
  • IPD, Collaborative JOC, and the use of actionable, objective, shared, current, local market construction task data, have  all demonstrated to significantly reduce environmental and financial waste, yet that knowledge is not enough to spark positive AECO change.

So again, ask, how to we  to spark positive AECO change.

 

spark positive AECO change yet that knowledge is note enough to

 

Construction Work Packages
commerical cost

www.4bt.us

DoD's reliance on RSMeans

DoD’s reliance on RSMeans for FSRM

The DoD’s reliance on “RSMeans “for FSRM (Facilities Sustainment, Restoration, and Modernization) cost management, despite the availability of current and verifiable local cost data, likely stems from several historical and institutional factors:

1. Historical Precedent and Familiarity

  • RSMeans has been a longstanding standard in construction cost estimation. Many DoD agencies have used it for decades, and institutional inertia can delay the adoption of newer methods, even if those methods offer better accuracy.

2. Perceived Standardization

  • RSMeans provides a nationally standardized database, which may give the illusion of consistency across different regions and projects. However, this approach often overlooks local market fluctuations and nuances, leading to inaccurate cost estimates.

3. Procurement Focus

  • DoD contracting processes have traditionally prioritized procurement tools over integrated cost management frameworks. Since RSMeans is often seen as a procurement support tool rather than a cost management solution, its use persists even though it doesn’t fully support LEAN construction principles or cost transparency.

4. Lack of Awareness or Trust in New Solutions

  • Even though objective, verifiable, and current local cost data is available, DoD decision-makers may not be aware of these solutions or may not trust their reliability without extensive validation. RSMeans, by contrast, is a “known quantity” and thus falsely perceived as lower risk.

5. Economic Adjustment Factor Issues

  • RSMeans often relies on national averages adjusted by economic factors, which can lead to significant errors—commonly as high as 30-40% and even greater on individual items due to inaccurate local market representations. However, without a push toward more localized cost data, such practices persist.

6. Need for a Shift in Strategy

  • Current cost management frameworks, like Collaborative JOC, Integrated Project Deliver, Progressive Design-Build, and Target Value Costing emphasize real-time cost visibility and collaboration between owners and contractors. However, unless the DoD transitions from a procurement-centric approach to one that prioritizes integrated project delivery and cost transparency, reliance on outdated methods will continue.  Objective, verifiable, current, local market cost data is readily available for repair, renovation, maintenance, and new construction.
DoD's reliance on RSMeans
Improving FSRM Cost Management
DoD's reliance on RSMeans
Altenative FSRM Cost Management Approach

Sustainable Construction Prerequisites

Sustainable construction prerequisites

Sustianable construction prerequisites for improving  cost, schedule,  quality, and satisfaction outcomes deserve greater focus.

First, let’s define sustainable construction.  In this context Sustainable Construction is the practice of planning, designing, building, and operating buildings and physical infrastructure in an environmentally and financially responsible way, involving, but not limited to:

  • Using robust, integrated Planning, Procurement, and Project Delivery Frameworks
  • Minimizing waste
  • Leveraging standardized, current, objective, verifiable, and local market granular (line-time construction task level) labor, material, and equipment data
  • Use of renewable and non-toxic materials, including S sustainable recycled building materials
  • Increasing energy efficiency
  • Improving indoor air quality
  • Conserving water

Despite the advances in innovation seen in the manufacturing and service industries, the majority of AECOO (architecture, engineering, construction, owner, operations/operator) practices are based upon traditional, antagonistic, and inefficient techniques which have remained in place due to poor formal and professional education and cultural barriers.  Sustainable construction prerequisites are not defined, nor applied.  The attendant sector fragmentation, supply chain deficiencies, and high levels of financial and environmental waste are staggering.

Fortunately,  robust, proven solutions are readily available, should real property owners display the requisite levels of leadership, capacity, and accountability

Adherence to sustainable construction prerequisites can reduce costs and other forms of waste by 30%-40%+.   This is accomplished by the consistent application of systems-thinking based processes to all repair, renovation, maintenance, and new build activities.  These frameworks mitigate common inefficiencies, mistakes, delays, and poor communications.

 

Sustainable Construction Prerequisites
Sustainable Construction Prerequisites

Sustainable Construction Prerequisites & Systems-Thinking Application

Numerous studies readily demonstrate that waste predominantly occurs due to a poorly communicated and poorly defined detailed project Scope of Work.  The interaction between planners, procurement professionals, construction managers, and trades actually doing the work is not early and ongoing and does not followed a robust process and associated workflow with defined information and workflow requirements.   AECCO focus has been upon the application of technology as a solution, with, as would be expected, virtually no measurable improvement in outcomes.  Adherence to sustianable construction prerequisites would benefit all participants and stakeholders.
Sustainable Construction Prerequisites
Construction Work Packages
commerical cost

The pervasive lack of a unified strategy has been readily apparent for decades.

Why LEAN Construction Matters

Construction TARGET COSTING – Should be required of all public sector real property owners

Construction Target Costing is a method used to shape repair, renovation, maintenance, or new build outcomes and process design to deliver customer value within specific constraints. Despite its effectiveness, it is seldom utilized by public sector real property owners. To effectively implement Construction Target Costing, several key elements must be considered:

1. Detailed technical and cost requirements for the project should align with current commercial construction standards. These requirements should be meticulously developed using precise labor, material, and equipment information sourced from the local market.

2. Collaborative preconstruction activities are essential. Internal and external Planning, Procurement, and Project Delivery Teams should engage in thorough information sharing to ensure a cohesive approach.

3. Embracing robust and collaborative “construction” delivery methodologies is crucial. This includes the creation of written execution plans or operation manuals, along with a multi-party contract that incorporates quantitative metrics for a successful project outcome.

construction target design
Construction Target Costing requires system thinking
construction target design
Construction Target Costing requires robust process
construction target design
Constructio Target Costing requires objective, granular, local market data

Comprehensive Construction database

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• Hold a kickoff workshop
• Use a set based approach, evaluating sets against target values
• Provide cost and constructability guidelines  and ensure process standardization
• Require collaboration
• Continuously improve uopn technical and cost detailing
• Use value engineering proactively
• Hold reguar review

Task Orders for Preventive Maintenanc

Task Orders for Preventive Maintenance – Government Sector

Far too often task orders for preventive maintenance are inefficient due to poor process and a lack of cost visibility/management.

A task order is a miniature contract that is used to define a project’s scope, cost, schedule, and to determine the obligations of the parties to the agreement1. It is an order for products or services associated with a main general contract that sets out the basic stipulations of a business agreement, in this case a preventive and routine maintenance contract. Task orders are used in IDIQs (indefinite delivery, indefinite quantity) and are adaptable contract types that give a government agency or agencies flexibility to agree to a contract when the exact requirements or needs are not known3. The agency provides specifics and describes the overall scope, project background, and Performance Work Statement/Statement of Work.

Specific to Preventive Maintenance, it is critical that a current objective, locally researched, preventive maintenance task database be used. The database can be used by contractors to bid a coefficient to include profit and overhead and to create individual task order for government approval. The government can use the PM database to ensure cost management by having an accurate representation of labor and materials for all associated tasks required for specific requirements. Both the government and the contractor have a detailed Scope of Work (SOW) for each PM activity based upon local market wage rates, associated materials, and the specific checklist of discrete tasks for the associated piece of equipment and frequency interval.

For example, the annual PM cost for a 200-bed hospital could be readily created using the PM task database and the building equipment inventory (i.e. Real property installed equipment (RPIE) or installed building equipment.)

Task Orders for Preventive Maintenance Task Orders for Preventive Maintenance preventive maintenance costs

Learn how to gain PM and routine maintenance cost visibility and cost management capability.

 

Industry Leading Cost Data

Industry Leading Cost Data

If you are using “industry leading cost data” and “following the pack” , then it’s time to optimize construction cost visibility and management.

Many organizations, especially in the public sector, are resistant to change. The belief is that there is safety and surety in maintaining the ‘status quo’. The net result is a failure to adopt innovative, productive, and cost saving solutions.

The following is a direct copy of a recent solicitation for “Construction Cost Estimating Software”. I have inserted informational comments in “red” and would love to hear your comments.

The acquisition of software to enhance the accuracy, efficiency, and competitiveness of our construction cost estimation process, acquiring RS Means is a strategic necessity. RS Means is a comprehensive and industry-standard database of construction cost information, offering detailed and up-to-date pricing data across a wide range of construction activities, materials, and labor. (RS Means is indeed a comprehensive industry standard database and very useful for reference purposes. It does not, however, provide up-to-date pricing for local market conditions. Price books are created annually and quarterly updates are provided using factors, called a CCI. The use of factors has been shown to introduced significant errors in costs.  It is also important to not the CCI is only based 66 materials, 21 trades and six pieces of equipment (plus fuel and maintenance costs, and reflective of a comparsion to thirty (30) defined ciities throughout the United States.  Further more RS Means notes that CCIs should NOT be used to to compare construction prices across different years, to predict price trends over time and for a specific location or to  adjust for local requirements, union practices, and building codes.)

With the dynamic nature of construction costs, the need for accurate, region-specific data is critical for project planning, budgeting, and ensuring that estimates reflect real-world conditions. (Construction costs are indeed dynamic and highly influence by local market, regional, and national factors.  That said, the only objective and verifiable method of creating a dependable estimate for a local site is to use locally reserached labor, material, and equipment costs applied to granular construction tasks based upon relevant commercial construction means and methods.  The latter is not accomplish with RS Means to the level available from alternative sources.) 

The following key points highlight the importance of acquiring RS Means:

Accurate Cost Estimation: RS Means provides reliable cost data for both new construction and renovation projects, ensuring that our estimates are based on current, localized market trends. (Most importantly it is important to understand  an  “accurate cost estimate” is a falacy.  Accuracy requires a datum, and a construction cost estimate lacks any quantitative, reliable datum. Construction estimates and be objective, verifiable, and granular.)

This level of precision will help reduce the risk of underestimating or overestimating project costs, leading to better financial planning. (There is no basis in fact for this statement.  Independent authors have noted that RSMeans costing methodology can result in significant error due to the reliance upon national averages and CCI factoring, resulting in both overestimating and underestimating.  See References below.)

Time Efficiency: RS Means includes a wide range of pre-built formulas and unit costs, which will streamline the estimation process. This allows our team to produce detailed and accurate estimates faster, saving valuable time on each project. (Speed in estimating comes from the use of a standardized data architecture, such as expanded CSI Masterformat and the associated aggregation of construction activities basis upon commercial standards.  Again, while “accurate estimates” is a misnomer/oxymoron, a more reliabe estimate for a specfic location can be achieve using local market labor, materials, and equipmetn data that is readily availabe via altenative sources.)

Industry Credibility: As a widely recognized and trusted source, RS Means data will enhance the credibility of our estimates with clients, contractors, and stakeholders. This will contribute to building trust and maintaining a competitive edge in the industry. (RSMeans is known as an “industry leader” due largely to its long-term use and market presence. It is, however, known by most skilled professional estimators to be a research resource.  In today’s environment, the ability to created verifiable local market cost estimates and to validate contractor and subcontractor bids is critical. This can only be accomplished using data that is locally researched and current and does not depend upon cost factoring, either location-based or economic.) 

Comprehensive Data Coverage: RS Means offers a broad scope of cost data, covering various construction types, geographical regions, and market sectors. This breadth of information will support more informed decision-making for diverse project types. (RSMeans provides approximately 90,000-line items of cost data, alternative source provide comparable quantities.)

Mitigating Cost Overruns: With access to detailed historical cost data and trends, RS Means enables better forecasting of future price changes. This will allow us to anticipate fluctuations and incorporate contingency plans, minimizing the likelihood of cost overruns during project execution.  (Historical cost data has very little, if any, influence upon forecasting future costs. Like the stock market, there are far too many variables that cannot be quantitatively considered to provide any significant level of predictive precision. While some organization may have and may continue to market the ability to predict future prices and costs, the ability remains elusive. The real source of cost overruns lies in poor organizational leadership, poor processes, use of improper data, and a lack of accountability.)

Care should be given as to what form of cost data is being used.  Objective, verifiable, and locally researched detailed line-item construction tasks, replete with labor, material, equipment and productivity information, provide the highest level of cost visibility and cost management capability.   4BT exclusively offers this information for any location, with all line-items organized using expanded CSI MasterFormat, enabling clear communication, collaboration, and alignment with all technical domains and participants throughout the planning, procurement, and project delivery lifecycle.

Other, less stringent forms of cost estimating include the following:

  • national average line-item cost data (with or without adjustment or localization factors),
  • system level cost data,
  • assembly level cost data,
  • building level,
  • and/or other forms of parametric cost data,
  • historical cost data and economic factoring,
  • contractor, subcontractor quotes.

[NOTE: UNIFORMAT is best used to express functional elements (assemblies) of a repair, renovation, maintnenance, or new build project).  It provides a consistent approach that describes associated components across different projects in cost and function.   It’s  primarily use is in early stages of a project where a specific work scope (scope of work/SOW) has not been fully defined and  critical characteristics of the projects  not yet been determined.   MasterFormat, accounts for  specific details of practical knowledge and terminology inclusive of means nd methods, and is primarilpy used at stages of a project where enough particulars and specific work scopes have been established, such as when a project is ready for procurement, or for the development of a reliable cost.]

Metrics for a Construction Cost Database

#1 Verifiable – All components are traceable, including labor, material, and equipment costs.

#2 Current – Cost data has been updated within the past quarter.

#3 Standardized, Easy to Understand, and Uniquely Identified – Common industry terms and definitions are used for all construction, repair, renovation, and maintenance task. Data is organized using a standard data architecture such as CSI MasterFormat or expanded UNIFORTMAT.

#4 Detailed – Data is presented at a granular level sufficient to support line item estimating.

#5 Local – Data is locally researched and does not rely upon location factors or economic factoring.

“Prevailing wage” is equivalent to the wage paid to at least 30% of workers in a given trade in a locality.

FM Productivity Constraints

Industry Leading Cost Data
commerical cost

Industry Leading Cost Data

References:

Multiple independent sources have noted the issues associated with using national average cost data and location factors as noted as follows.

 

“Location factors are used during preliminary project evaluations. They are not intended to be used when preparing appropriation-quality estimates. They often are applied to conceptual estimates for identifying “go/no-go” projects at an early stage.”

(Peitlock, B.A., ccc, Developing Location Factors Using a Factoring Method, International Cost Engineering Council, ICEC International Cost Management Journal (ICMJ), 1998.)

 

Location factors are primarily used in class 4 and 5 estimates and are not intended to be used for higher quality estimates, such as class 3, 2, or 1. The RSMeans city cost index (CCI) and the Department of Defense area cost factor (ACF) index are two primary examples of location factor publications.

(Martinez, A., Validation of methods for adjusting construction cost estimates by project location, University of New Mexico UNM Digital Repository, 2010)

 

“Despite its potential weaknesses, estimation by adjustment factors is a very common approach for all types of construction. A very common approach for performing quick-order-of-magnitude estimates is based on using Location Cost Adjustment Factors (LCAFs). The accuracy of cost estimates in the early phases varies within an expected range that spans from -100% to +200% ” “Using the results of this study, various commercial entities (e.g., RS Means) could enhance their online tools by uploading publicly available socio-economic variables and allowing users to perform geostatistical analysis. As a result, a cost engineer could input the location of a project and obtain the most accurate location adjustment factor through a mix of interpolation and geostatistical prediction techniques.”

(Migliaccio, G., Empirical Assessment of Spatial Prediction Methods for Location Cost Adjustment Factors, J Constr Eng Manag. 2013)

 

“Problems within the methodology, unfortunately, will continue to arise as standardized estimation tools (CCI) simply cannot account for the unique characteristics of individual states.  Unfortunately, the accuracy of program-wide CCIs occasionally led to swings of ±20 percent after projects had gone through the bidding process. Additionally, no direct application of market or economic conditions existed in this conventional CCI process, which was theorized by FHWA to potentially be a significant influence on resulting project estimate accuracy.”

(University of Colorado Denver College of Engineering and Applied Science Department of Civil Engineering, Validation of Project-level Construction Cost Index Estimation Methodology, 2017)

 

In the United States, RSMeans and other published construction cost data are useful for estimating the overall cost of a project. However, these are typically nationally aggregated mean costs and intended to be used with a local multiplier. Prior studies have found that locally adjusted RSMeans costs vary from actual local material prices. For example, Estes (2016) found that for a slab-on-grade foundation assembly with 0.1 m (4 inches) thick slab, vapour barrier and welded wire fabric in Baton Rouge, Louisiana, United States, concrete was found to be underestimated by 18% and vapour barrier by as much as 67%. Additionally, assembly costs for 0.1 m (4 inches) thick concrete slab were found to differ significantly (p = 0.004, α = 0.05) when comparing locally sourced costs and adjusted RSMeans cost data (Estes, 2016). Published cost data also lack accuracy due to the type and manner of data collected and represented. For example, RSMeans data do not account for variations caused by local codes, productivity rates, climate conditions, labor quality and availability, or costs related to land prices and permit fees

(Kodavatiganti Y, Rahim MA, Friedland CJ, Mostafiz RB, Taghinezhad A and Heil S (2023), Material quantities and estimated construction costs for new elevated IRC 2015-compliant single-family home foundations. Front. Built Environ. 9:1111563. doi: 10.3389/fbuil.2023.1111563) Front. Built Environ., 21 May 2023 Sec. Construction Management Volume 9 – 2023 | https://doi.org/10.3389/fbuil.2023.1111563)

 

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Construction work packages

Construction Work Packages

Construction work packages are the scalable standard for construction processes. All data is structured around it, and all workflows are designed inside the work package.

That said, what is the standard/holy grail for validating work packages?

  1. Estimating costs and Optimizing  costs – Current, objective, locally research granular construction task data organized using expanded CSI MasterFormat.
  2. Sequence creation
  3. Optimizing labor resources
  4. Optimized flow
  5. Optimized efficiency
  6. Estimating risks
  7. Estimating manpower
  8. Offering intelligent solutions
  9. Optimizing scheduling
  10. Automated workpackage creation
  11. Optimized work content
  12. Optimizing logistics

 

Construction Work Packages
Creating Construction Work Packages
IPD methodology is critical to apply within JOC Programs and rarely applied.   Directly daily involvement without the excessive use of “JOC Consultants” is the only path that enables growth of owner knowledge, capability, and improved outcomes.  The integration of collaborative internal and external Planning, Procurement, and Project Delivery teams is equally important.  While TAKT, LPS, etc. are important, LEAN construction can  be achieved via a holistic approach that puts People first then Process, Information, and  enabling Technology.
Organizational maturity with respect to data usage is also a key component with respect to Construction Work Packages.
Construction Work Packages
Construction Advanced Work
Reach out to further the discussion.

 

OpenCOSTTM  Construction Cost Data is now available exclusively from 4BT! 

Managing any type of construction project requires the ability to OBJECTIVELY VERIFY local market costs.  

  • The traditional use of a “national average cost database”  and location factoring (city cost index – CCI)   to introduces significant error and therefore provides insufficient cost visibility and cost management capability. (See “Source Information”). 
  • The use of historical cost data and economic factoring is equally ineffective.
  • Verification of contractor and trades quotes is a must!

Our veteran-owned certified small business, Four BT, LLC (4BT) now provides online software, current, local market cost data, and full support services enabling significantly enhanced construction work packages and cost estimation.  

All cost data is locally researched, granular to the construction task level, organized by expanded CSI MasterFormat, and updated quarterly (without any use of economic or location factoring). 

Comprehensive Unit Cost Database

Comprehensive Unit Cost Database – Construction

Improve construction cost visibility and management with a LOCAL, CURRENT, OBJECTIVE, and VERIFIABLE Comprehensive Unit Cost Database with 90,000 granular construction tasks including labor, material, equipment, and productivity details.

Getting preconstruction data and process right is critical and only 4BT (Four BT, LLC) offers local market granular cost data that is locally researched, provided in expanded CSI Masterformat, inclusive of over 90,000-line times, and capable of providing a highest degree of cost visibility and cost management available today.

Comprehensive Unit Cost Database

  1. Easily estimate the any type of commercial repair, renovation, maintenance, or new build project.
  2. No longer rely on historical data, national average cost data, contractor lump sum quotes, location factors, or economic factors
  3. Improve cost estimates and visibility 30%-40%+
  4. Itemize quantities, labor requirements, materials, equipment.
  5. Move beyond square foot and parametric estimating
  6. Stop using inefficient processes and get Planning, Procurement, and Project Delivery Teams on the same page via robust programmatic frameworks.

 

Active Construction Cost Management
commerical cost

Comprehensive Construction database Construction Advanced Work

 

 

 

Notes: Problems with using location and economic factors –

 

Schedule an informational session.

 

Advancing construction cost estimating data, tools, communications, and technology is central to achieving sustainable facilities management.

Traditional tools, such a national average cost data, location factors, historical costs, and spreadsheet no longer support today’s need for enhanced cost visibility, transparency, and management.

Advancing Construction Costs Estimating Tools for Today and Tomorrow

  1. Local market research – To be relevant, construction cost data must reflect local market conditions.  This means specifically researching local labor markets across all trades, research local market materials to determine local, regional, and national interdependencies, and of course, equipment costs.
  2. Dynamic vs. static – Cost data is in continuous flux, therefore local market data needs to be research at least on a quarterly basis, or more frequently basis upon market conditions.
  3. Granularity – All cost data needs be presented a detailed, individual construction task data to provide the highest level of cost visibility and reliability.
  4. Objective – Using an independent resource for local market cost data avoid any potential bias or conflict of interest.
  5. Standard Format – Cost data represented using expanded CSI MasterFormat, with all description in plain English and using industry standard terms.
commercial construction costs

Commerical Construction Costs 2024

Commercial Construction Costs 2024  increased 0.1% for the month of November 2024, while overall construction input prices are 0.5% higher than a year ago, and nonresidential construction input prices are 0.3% higher. Prices decreased crude petroleum prices were down 3.3%, while unprocessed energy materials prices were down 2.0%., while natural gas prices were up 2.6% in November.

Commercial Construction Costs 2025

Commercial Construction Costs 2024

Commercial Construction Costs 2025

 

Objective, Current, and Local Market Granular Labor, Material, Equipment Commercial Construction Cost Data is exclusively available form Four BT, LLC in expanded CSI MasterFormat.  All data is updated quarterly without the use of location or economic factors.

Owner and design-builders gain 30%-40%+ in cost visibility and cost management capability, reducing both risk and overall construction costs.

ALliance Job Order Contracting

Active Construction Cost Management
commerical cost

Learn how to better manage Commercial Construction Costs 2024 and beyond.

FM productivity constraints remain a barrier for most public sector areas.

FM productivity constraints remain a barrier for most public sector organizations, presenting barriers to efficient sustainment & new builds.

To address rising sustainment (repair, renovation, maintenance) and new build  costs, robust, integrated Planning, Procurement, and Project Deliver Frameworks are increasing needed to maximize resource utilization.

Why LEAN Construction Matters

FM Productivity Constraints – Public Sector

FM productivity constraints remain a barrier for most public sector areas.

FM productivity constraints remain a barrier for most public sector organizations, presenting barriers to efficient sustainment & new builds.

To address rising sustainment (repair, renovation, maintenance) and new build costs, robust, integrated Planning, Procurement, and Project Deliver Frameworks arecincreasing needed to maximize resource utilization.Yet public sector organization are still not providing the Leadership, Commitment, and Accountability in this area.

Legacy policies, practices and systems are the biggest barriers to requisite change management, the latter capable of delivering 30%-40%+ reductions in financial and environmental waste. Transformation, thought sorely needed, does not appear to be on the horizon.

Challenges to Sustainable FM in the Public Sector
1. Lack of real property owner leadership, commitment, and accountability
2. Planning, Procurement, and Project Delivery Teams not ready, or not willing, or not being allowed to implement efficient methods and technologies.
3. Barriers to collaboration among owners, architects, engineers, and builders.
4. Poor information management
5. Lack of clear priorities
6. Lack of awareness and education relative to efficient lifecycle facilities management.

The importance of financial, environmental, and social governance is clear, however, measurable improvement remains nonexistent.

Pathway to Sustainable FM in the Public Sector
1. Organizational Leadership, Commitment, and Accountability
2. Integrated Planning, Procurement, and Project Delivery
3. Support of Change Management
4. Adoption of robust Programmatic project deliver methods
5. Use of objective, current, granular, Local Market, labor, material, equipment and productivity data
6. Mandatory initial and ongoing multi-format, multi-level training in collaborative FM lifecycle total cost of ownerships asset management methods
7. Quantitative performance metrics
8. Regular independent audits

FM Productivity Constraints
FM Productivity Constraints

 

Active Construction Cost Management ALliance Job Order Contracting data driven cost estimating

Request more information or set up a Teams meeting!

Facilities asset lifecycle management

Facilities asset lifecycle management

A robust Facilities asset lifecycle management process is required to sustainably manage any building portfolio.

The good news is that adapting to and implementing a facilities lifecycle management process is not difficult and frameworks are readily avaialable  that can measurably reduce financial and environmental waste.

Reach out learn…

  • How to accelerate your facilities lifecycle management journey and move to data-driven decisionmaking.
  • What types of data and data formats are needed.
  • Detailed workfows for managing Programs, Contracts, Projects, Workorders, Documents, People and more.
  • Multiple Key Performance Indicators (KPIs) to measure success.
  • Why focus upon People first is critical to creating long-term mutually beneficial relationship.
  • The benefits of Program versus Project Management.
  • How to integrate Planning, Procurement, and Project Delivery Teams

 

The ability to engage in sustainable Facilities asset lifecycle management has eluded most public sector organizations as it requires a significant change in behaviors, means, and methods.  As noted, however, all the required tools and support services are readily available.

All that is needed are the requisite levels of commitment, leadership, capability, and accountability to reduce financial and environmental waste associated with facilities repair, renovation, maintenance, and new construction activities.

Facilities asset lifecycle management
Barriers to Facilities asset lifecycle management

 

Why LEAN Construction Matters

Managing Change Orders

Managing change orders for any size of repair, renovation, maintenance, or new build project, whether IPD, alliance job order contracting, DB, DBB, ‘et al’,  simply requires a robust preconstruction process in most instances.

A granular, well communciated (among owner and design/builders), well organized (using a standardized data architecture such as expanded CSI MasterFormat) DETAILED SCOPE OF WORK, eliminates of 90% of change orders.

Change orders should not result from errors and omissions,  coordination issues, means and methods, or material substitutions as these are all manageable via application of robust, detailed scope of work (SOW) development.   Objective, granular, current, local market granular construction task data is a requisite tools for robust scope of work development.

Managing Change Orders
Managing Change Orders

 

 

 

Typical change orders that may not be attributed to inefficient preconstruction activities include.

Agency change orders –  Originate from permitting or regulatory organization and not associated with existing standard codes.

Discovered site conditions – Site conditions not readily found using standard pre-construction practices.

Owner scope change – Changes initiative by the real property owner  is the most common reason for work scope modification.

 

Learn more about Managing Change Orders…

Managing Change Orders

A robust and integrated Construction Planning, Procurement, and Project Deliver Framework is the pathway to reducing change orders, lowering project costs, and ensuring timely delivery.

The management of change orders  projects is a dynamic process beginning early in a project lifecycle and involves all project participants and stakeholders from day one.  A robust project delivery framework is needed and must be supported by both a written contract and an operations manual or execution guide.   This proactive and collaborative approach of sharing cost and technical requirements from day one can ensure 30%-40% cost saving vs. traditionalmethods.

Owner and service provider teams jointly bear risk and share in reward and foucs upon  collaborative planning and effective communication.,ensuring project continuity and success.

Challenge and Improve Construction Cost Estimating

Challenge and Improve Construction Cost Estimating

Challenge and improve construction cost estimating methods by enhancing data and ensuring process standardization.

Improving construction cost estimating data and processes are central to significantly enhancing cost visibility and cost management.

Robust Construction Cost Estimating Requirements:

#1.  Detailed line item estimating

#2. Local market, current, verifiable and objective labor, material, equipment, and productivity data sets linked to granular construction tasks.

#3. Standardization of terms, definitions, descriptions, and data architecture (sample data architecture:  expanded CSI MasterFormat).

#4. Collaborative and integrated planning, procurement, and project delivery processes and teams.

#5. Experienced construction cost estimators.

#6. Leadership support.

Savvy professionals understand the need to Challenge and Improve Construction Cost Estimating.

Advancing construction cost estimating data, tools, communications, and technology is central to achieving sustainable facilities management.

Traditional tools, such a national average cost data, location factors, historical costs, and spreadsheet no longer support today’s need for enhanced cost visibility, transparency, and management.

Advancing Construction Costs Estimating Tools for Today and Tomorrow

  1. Local market research – To be relevant, construction cost data must reflect local market conditions.  This means specifically researching local labor markets across all trades, research local market materials to determine local, regional, and national interdependencies, and of course, equipment costs.
  2. Dynamic vs. static – Cost data is in continuous flux, therefore local market data needs to be research at least on a quarterly basis, or more frequently basis upon market conditions.
  3. Granularity – All cost data needs be presented a detailed, individual construction task data to provide the highest level of cost visibility and reliability.
  4. Objective – Using an independent resource for local market cost data avoid any potential bias or conflict of interest.
  5. Standard Format – Cost data represented using expanded CSI MasterFormat, with all description in plain English and using industry standard terms.

 

Challenge and improve construction cost estimating
Challenge and improve construction cost estimating methods by enhancing data and ensuring process standardization.

Traditionally cost estimates are created by either contacting local constractors or subconstractors, or by using a national average construction cost database and applying a cost factor.  Neither of this methods generally provides sufficient cost visibility or truly enables cost management.

The ONLY way to have an objective, and verifiable construction cost estimate is to create a line item listing of granular construction tasks using LOCAL MARKET, current labor, material, and equipment costs.

Engage in data driven cost estimating with objective, verifiable, and current local market labor, material, and equipment price books from 4BT (Four BT, LLC).

Approximately 90,000 line items including demolition lines and line item modifiers available within an easy-to-use web application.

Challenge and improve construction cost estimating Challenge and improve construction cost estimating

Request and educational Teams Meeting:

circular construction

 

Alliance Job Order Contracting

Alliance Job Order Contracting 2025

Alliance Job Order Contracting has multiple benefits over traditional JOC.

While traditional JOC Programs use national average cost data and location factoring or pay “JOC Consultants” a percentage of total JOC construction volume, neither maximize the potential of Alliance Job Order Contracting.  The older methods, while prevalent and arguable the ‘status quo, do not provide requisite levels of cost visibility and/or cost management.   Nor do they generally provide the level of support and collaboration required to maximize return on investment in mutually acceptable manner for both real property owners and JOC design/builders.

What is Alliance Job Order Contracting?

  1.   A form of integrated project delivery specifically designed to maximize efficiency of repair, renovation, maintenance, or new build projects.
  2.   A fully support framework that focuses upon an integrated vs. current silo-based Planning, Procurement, and Project Delivery approaches.
  3.   Validated financial transparency supported by objective, verifiable, and current labor, material, labor, and productivity information (no use of location or economic factoring).
  4.   Multi-formant, multi-level training and support for all participants and stakeholders.
  5.  A methodology that enables owners to build and retain knowledge vs. dependency upon “JOC consultants”.
  6.  Superior replacement to traditional JOC Programs and up to 10x less costly, while providing 30%-40%+ enhanced cost visibility.

alliance job order contacting Alliance Job Order Contracting ALliance Job Order Contracting

Schedule an educational Teams Meeting

Alliance Job Order Contracting

  • Auditable Procurement Process
  • Verifiable, current, and dynamic cost information
  • Superior capacity utilization
  • Enhanced collaboration
  • Unparalleled support
  • Realtime management feedback
Early Contractor Involvement

Early Contractor Involvement & Improved Sustainment / Construction Cost Management

Early Contractor Involvement is a mandatory component in any real property owner process designed to ensure consistent delivery of quaility repair, renovation, maintenance, and new build projects on-time and on-budget.

 

The issues associated with Traditional Construction* Project Delivery  (DB, DBB, CMAR…) are clear.

  • Lack of Detailed Line-item based Plans & Specs
  • Change Orders
  • Disputes
  • Adversarial
  • Cost/Schedule Growth

early contractor involvement

Introduce capacity for innovation via collaboration and early contractor involvement

Collaborative Project Delivery (Integrated Project Delivery and Advanced Job Order Contracting)

  • Non-traditional Program-centric Project Administration
  • Preconstruction integrated team collaboration (owner, design/builder, planning/procurement/project delivery)
  • Improved Design Quality – Constructability
  • Objective, verifiable, current, standardized, local market granular cost data
  • Increased understanding of market conditions
  • Pricing feedback from industry during design development
  • Fast Tracking
  • Earned Value Management Focus
  • Shared risk of cost increases
  • Mitigated change orders and disputes
  • 90%+ On-time/On-budget
  • Contractor incentivized to collaboratively work with Government team to meet cost objectives

 

 

Early contractor involvement ensures consistent quality, timely delivery, & cost control for government real property owners.

Early Contractor Involvement

*Construction = repair, renovation, maintenance, and new builds

4bt.us

Why LEAN Construction Matters

Circular Construction and Its Benefits

The benefits of circular construction and a consistently applied programmatic approach to all repair, renovation, maintenance, and new build projects include a significant reduction in financial and environmental waste.

Keywords: Construction, facilitiesmanagement, totalcostofownership, assetmangement,  lifecycle, costmanagement, Circular economy, Recycling, Waste management, Reuse, Machine learning

What is circular construction?  The application of strategies such as integrated planning, procurement, and project delivery, and a regenerative model for materials reuse, design for disassembly, prefabrication, and recycling for reducing resource consumption and waste.

What is circular procurement?  A process of prioritizing the purchase and user of  products and services designed to minimize waste, maximize resource reuse, and extend “product” lifespans throughout their entire lifecycle, thereby supporting a more sustainable supply chain; essentially, it involves looking beyond initial purchase price to consider the product’s entire life cycle and potential for recycling or reusing materials when it reaches the end of its useful life.

The construction industry is a heavy consumer of natural resources including materials and energy consumption and a major contributor to environmental issues including  elevated greenhouse gas (GHG) emissions, air pollution, environmental degradation, and global warming.  Furthermore, approximately 80% of construction materials end up as waste at the end of their useful life, and 80% 0f construction projects* are over budget, late, or completed with some level of perceived dissatisfaction from participants/stakeholders.

Unfortunately, the lack of a centralized materials reuse/recycling model specific to the built environment presents a major barrier, as does the relative lack of leadership to support requisite change throughout the AECOO** sector.  Additionally, knowledge sharing among built environment participants and stakeholders (owners, architects, builders, materials suppliers…) remains limited due to industry culture.

A prioritization of material reuse and lifecycle asset management form both overall cost and benefit perspectives must occur before the AECOO sector can achieve any level of measurable improvement.

 

 

circular construction

circular construction circular construction

 

*Construction includes new builds, rebuild, renovation, or maintenance activities.

**AECOO – Architecture, Engineering, Construction, Owner, Operator/Operations

 

construction advanced work packaging

Construction Advanced Work Packaging AWP

Construction advance work packaging isn’t really “advanced”, but the application of common sense by skilled professionals.

Cost overruns and delays result in the 80%+ of all repair, renovation, maintenance, and new build projects being 30%-40% over budget.

Construction advanced work Packaging is a construction-driven planning and collaboration system for building capital projects that is sharply focused on creating a constraint-free work environment in the field. It requires that detailed work packages be created early in the project life cycle; i.e., in advance.

85% of construction “failures”* are the result of poor preconstruction planning and disjointed procurement, and/or failure to implement a robust, collaborative project delivery method.  Construction advanced work packing is a mandatory component of a any resolution framework.

Focus upon front-end defintion of project requirements and teams enables the higher likelyhood of project success. Seting setting clear directions, and deliverables at a granular level ensures cost-effective and timely project delivery.

While “flow” methods and philosophies such as last planner, takt, etc., have significant value, the requirement for detailed construction task data at a granular level, complete with current, local market labor, material, and equipment data, based upon commerical construction requirements and a standardized data architecture (i.e. expanded CSI Masterformat) is mandatory.  This approach is ideal for the fastest and most economical project outcome, and associated mitigation of communication errors, omissions, and change orders.

Establishiing an ideal schedule and alignment with AEC and owner participants requires a detailed understanding of project line items, crews, and associated productivity. Collaboration among these teams through onging interactive planning sessions to identify gaps and explore opportunities to build and accelerate schedules using a common, shared, and reliable detailed local market construction cost database is a proven pathway to project success.

Active Construction Cost Management active construction cost management Construction Advanced Work

It’s no secret that cost proposals are highly dependent upon perceived risk on the part of design-builders.   A detailed and shared understanding of construction requirements significantly lowers perceived risk.

Changing the Way Projects are Defined, Procured, and Run

Construction advanced work packaging, in conjunction with integrated project delivery and collaborative job order contracting and/or alliance partnering is a transformative methodology that redefines project planning and execution.   Planning, Procurement,  and  Project Delivery, inclusive of  collaborative scheduling, tracking, and other process define success.

The shortcomings of the traditional approaches, where planning, procurement, and project delivery teams and objectives are disjointed and conflicted  lead to delays, change orders, and cost overruns.   The only way to stop pervasive financial and environmental waste is to leverage robust, integrated frameworks and common data environments based on “lessons learned” through decades of experience, identified key project influences, and leverage front end AWP and integrated internal and external planning, procurement, and project delivery teams.  This approach enables owners and service providers to deliver the fastest and most cost-effective projects  without compromising quality or safety.

 

*A construction “failure” is a renovation, repair, maintenance, or new build activity that is over budget, late, or result in dissatisfaction of one or more project participants.

 

“The earlier project participants get involved, and leverage advanced work packaging and a common data environment the more they can contribute to the beneficial influence on any project” 

Learn more….

cost saving public sector FM solution

Cost Saving Public Sector FM Solution

An innovative cost saving public sector FM solution is now available.   

Organizations can save 30%-40%+ vs. traditional methods for renovation, repair, and maintenance projects.

Consequently, a practical, proven framework delivers enhanced cost visibility and cost management capability.

  1. Use Verifiable, Objective, and Current granular local market cost data
  2. Standardize work packaging using expanded CSI MasterFormat
  3. Maximize Efficiency
  4. Ensure Compliance

No longer rely solely upon contractor/subcontractor quotes, historical data, or national average price data and location/economic factoring!

The best path forward is for everyone to agree upon what must be done!*

Most importantly you gain reliable insight into costs, and labor, material, and equipment, and time requirements.

  1. The amount of time which is needed complete the process to meet the customer demand
  2. The granular construction tasks required, step by step operations needed.
  3. Monitor projects through planning, procurement, and project delivery stages.
  4. Detailed, easily communicated Scope of Work creations.

Objective, current, and local labor, material and equipment data  provides a fast & efficient way of defining standard work.

Cost Saving Public Sector FM Solution
Cost Saving Public Sector FM Solution

Cost Saving Public Sector FM Solution

Learn more about a Cost Saving Public Sector FM Solution, proven to drive better outcomes for owners and design-builders.

 

*Every repair, renovation, maintenance, or new build requires skilled professionals to all agree on exactly what the process should deliver.  Work must be clearly defined among all participants and this requires the defining of work standards inclusive of terms, definitions, data format and architectures.  Means and methods, timing, and sequence can only be defined across a multidiscipline team via a requisite level of standardization.    An objective granular construction task list, organized using expanded CSI MasterFormat enables teams to better create, communicate, and evaluate the steps required to enable a high degree of confidence in project completion.  It also provides a framework for continuous improvement.  Teams can better identify and discuss improvements to means, methods, sequence, etc., to help generate and build awareness of potential improvements.   A reliable standard work classification is a foundational element for any lean, collaborative planning, procurement, and project delivery approach.

 

via Four BT, LLC – www.4bt.us – Innovative Construction Planning, Procurement, and Project Delivery Solutions

Practical LEAN construction

Practical LEAN Construction

Practical LEAN construction frameworks involve robust approaches inclusive of multi-level training, detailed workflows, clear responsibilities, and a common data environment (CDE)*.

Examples of practical LEAN construction frameworks are Integrated Project Delivery (if it includes objective, granular, detailed line-time construction task data), Alliance Partnering, and collaborative Job Order Contracting.

While there are multiple philosophies, partial solutions, and a hundreds of so called “LEAN experts”, the simple truth is that less than 1% of projects incorporate all the requisite components of LEAN.   Those owners and design-builders who do implement practical LEAN construction frameworks can consistently save 30%-40% vs. their peers and deliver quality projects on-time.

Practical LEAN constructionPractical LEAN construction

Practical LEAN construction

Request White Papers

*A “Common Data Environment” (CDE) is a centralized digital platform where all project information related to a construction project is stored and accessible to all team members, allowing for streamlined collaboration and improved decision-making by providing a single source of truth for project data, crucial for efficient facilities lifecycle management workflows and Lean Construction practices.   Learn more.

Guide to Practical LEAN Construction

Active Construction Cost Managemen

Active Construction Cost Management – Government, Healthcare, Education, Transportation

Active Construction Cost Management is important to any repair, renovation, maintenance, or new build activity.   Yet, despite is value, most public sector organizations have yet to deploy it.

Over eighty percent (80%+) of all projects are late or overbudget largely due to an inadequately detailed and poorly communicated Scope of Work (SOW), including the failure to leverage readily available objective, current, verifiable, local market labor, material, equipment, and productivity data.

Questions every real property owners should ask before procuring a repair, renovation, maintenance, or new build service.

#1 Can I objectively validate the cost estimate?

#2 Is the cost estimate objective?

#3 Does the cost estimating include all granular construction tasks and quantities, including labor, material, equipment, and productivity representing current local market conditions.

#4 Is the cost estimate organized using a standard data architecture (i.e. expanded CSI MasterFormat) and industry standard terms and definitions understandable to all participants and stakeholders?

#5 Do all planning, procurement, and project delivery teams understand and agree with the construction cost estimate?

#6 Can I dynamically review, edit, and track the construction cost estimate as needed?  Are all changes logged as well as notes included per line-item as to why changes were made?

#7 Can I track the performance of the cost estimate through the project lifecycle?

#8 Is my cost estimate part of a robust, integrated planning, procurement, and project delivery process?

 

Haven’t answered “Yes” to all the above….  let’s talk.

 

active construction cost management

active construction cost management

Construction Cost Management Methods

Construction Cost Management Methods – Public Sector

The underutilization of robust  construction cost management methods continue to drive high levels of waste across virtually all public sector organizations.

You can’t manage what you don’t measure… 

A standardized approach to construction data collection, maintenance, and use should be established use a common format data format and yields objective, verifiable, and current local market labor, material, equipment, and productivity details.  The data should then be made available to both public and private sector audiences to leverage the latest methods and tools supporting optimal project planning, costing, procurement, delivery, and lifecycle management.

Both data and tools are readily available to align and optimize owner, design-builder, and facilities management teams.

Construction Cost Management Methods Construction Cost Management Methods

Metrics for a Construction Cost Database

#1 Verifiable – All components are traceable, including labor, material, and equipment costs.

#2 Current – Cost data has been updated within the past quarter.

#3 Standardized, Easy to Understand, and Uniquely Identified – Common industry terms and definitions are used for all construction, repair, renovation, and maintenance task. Data is organized using a standard data architecture such as CSI MasterFormat or expanded UNIFORMAT.

#4 Detailed – Data is presented at a granular level sufficient to support line item estimating.

#5 Local Market – Data is locally researched and does not rely upon location factors or economic factoring.

“Prevailing wage” is equivalent to the wage paid to at least 30% of workers in a given trade in a locality.

4bt.us – Your exclusive resource for current, actionable, and verifiable local market construction cost data.

 

 

 

Why LEAN Construction Matters

Construction Cost Optimization

The Guide to Construction Cost Optimization provides a road map for applying best management practices to drive financial visibility and transparency.

Introduction

Objective, verifiable, and locally researched detailed line-item unit price construction data provides the highest level of cost visibility and cost management capability.

Since other levels or types of cost estimating can’t meet this level, care should be given as to what form of cost data is being use.

Other, less stringent forms of cost estimating include the following: national average line-item cost data (with or without adjustment or localization factors), system or assembly level cost data,  building level and/or other forms of parametric cost data, as well as historical cost data and economic factoring.

Construction Cost Optimization
Construction Cost Optimization

Labor

Based upon contract requirements, local labor costs may be sourced from published Davis Bacon Wage Rates, or published state data sources, or directly researched local prevailing wage rates with appropriate inclusion markups for worker compensation, unemployment, liability insurance and allowance for small tools and consumables.  In the public sector,  federal government contracts may require Davis Bacon Wage Rates or prevailing wage rates, or both, with the usage of the higher of the two.   Markups include worker compensation and unemployment insurance costs per state in which work is performed. Liability insurance based upon local contractor rates is also added as a percentage. Finally, a percentage of labor is added for small tools and consumables based upon the labor category. The base rate usually does not include overhead and profit, however, can be added later to ensure data integrity.

In addition, highly specialized subcontract items may require travel and per-diem expenses for mechanics.

The labor-hours expressed in quality construction cost databases reflect average installation time, using an efficiency level that is consistent with the particular trade.

Material Costs

Material costs are local for commodities such as concrete, asphalt and aggregate. Other material costs are based upon either local costs, national or regional costs. Many items that are researched do not vary nationally due to the national pricing by many vendors and manufacturers. Some costs are regional and are priced for large areas of the country such as western, central and eastern states. If regional or national prices are used, these should be checked against local pricing to assure that the local costs do not significantly vary. Material costs are either local, regional or national depending upon the location. Sales tax is generally not added unless requested to ensure data integrity.   Material prices must consider whether local areas are remote  or congested inner-city regions which can cause significant variance.

Equipment Costs 

Equipment costs are either local rates or a national rate for each piece of equipment used in crews performing the task based upon daily usage. Overhead and profit markups are not included in the pricing, but can be added electronically to the database as needed.
General Conditions

General overhead and profit can be added by percentage if desired.  In addition, some general provision items can be added to the estimate such as construction trailers, cleanup and temporary power.
Quality / Quantity

The prices for materials and the workmanship are based upon normal construction standards. Many material prices can also be adjusted for quantity as an adjustment factor in the database.   The are generally provided in the form of line item modifiers.  Modifiers are add or deduct cost from the parent line item.

via Four BT, LLC, the AEC industry’s innovative integrated project delivery, detailed locally researched construction cost data, and SAAS technology solutions provider. Integrating powerful, proven project planning, procurement, and execution methods to help guide organizations to achieve accelerated improvement of their facilities repair, renovation, and construction outcomes. We focus upon supporting a collaborative culture and client-specific programs centered upon delivering customer value, driven by, proven LEAN processes, actionable data, enabling cloud technology, ongoing training, and continuous improvement.

Improve Construction Cost Certainty

Improve Construction Cost Certainty

The need to improve construction cost certainty is critical regardess of whether repair, renovation, maintenance, or new build projects are invovled.

Here is proven method improving cost visibility and saving up to 30%40%.

  1. Create detailed line item estimates for ALL repair, renovation, maintenance, and new build projects.
  2. Use LOCALLY RESEARCHED labor, material, and equipment costs from an objective source.
  3. Ensure cost data is CURRENT and organized using expanded CSI MasterFormat.
  4. Require all service providers use the same costing methodology.

Learn more….

 

significantly improved contruction cost visibility improve construction cost certainty

Why LEAN Construction Matters

Better CONSTRUCTION COST ESTIMATION workflows

Better CONSTRUCTION COST ESTIMATION workflows can be used by owners and design-builders to better navigate the journey to improved cost visibility and cost management.

Leveraging single resource for  Objective, Verifiable, and Current LOCAL MARKET granular construction tasks (over 90,000) replete with labor, material, and equipment costs and productivity informatoin is a proven pathway to the development of a ROBUST SCOPE OF WORK and OnBUDGET project delivery.

Reliance on subcontractor or contractor quotes and national average cost data and location factoring, or historical cost data introduces significant cost errors of 30% to 40%+.

Learn more today.

Better CONSTRUCTION COST ESTIMATION
Better CONSTRUCTION COST ESTIMATION
Better CONSTRUCTION COST ESTIMATION
Better CONSTRUCTION COST ESTIMATION

 

MINIMIZING TIME AND COST OF Commercial Construction

MINIMIZING TIME AND COST OF Commercial Construction PROJECTs

 

Minimizing the time and cost of commercial construction projects without sacrificing quality requires the following elements:

  1. Owner leadership and accountability
  2.  Integreated planning, procurement, and project delivery teams
  3.  A well defined and well communicated detailed Scope of Work
  4.  A process focused upon mutually beneficial outcomes.

90%+ of ALL repair, renovation, maintenance, and new build projects “fail” due to a poorly defined and poorly communicated Scope of Work (SOW).

Considering that most project failures (late, overbudget, general dissatisfaction) are due to a poorly defined scope of work, focus upon this area is paramount. Without an objective, verificable, well communicated and agreed upon scope of work it is virtually impossible to have any reliable form of cost visibility, cost management, or technical review.

improving mutl-trade construction cost estimates

What is are some of requirements for a detailed scope of work?

  • A common, shared data environment.
  • An objective, verifiable database, of detailed line item construction tasks developed using current, locally reserached labor, material, and equipment data.
  • A robust process for SOW development, review, and approve.

Request an 18-page document on how to create a detailed SOW.

Transform Construction Cost Estimating

Transform Construction Cost Estimating

If your projects are overbudget, late, and continue to go “off the rails”, it may be time to transform construction cost estimating practices.

Transform Construction Cost Estimating
Transform Construction Cost Estimating

 

Traditionally cost estimates are created by either contacting local constractors or subconstractors, or by using a national average construction cost database and applying a cost factor.  Neither of this methods generally provides sufficient cost visibility or truly enables cost management.

The ONLY way to have an objective, and verifiable construction cost estimate is to create a line item listing of granular construction tasks using LOCAL MARKET, current labor, material, and equipment costs.

If you are ready to transform construction cost estimating, improve your detailed scope of work, and significantly improve construction cost management, contact us today!

transform constuction cost estimating data driven cost estimating

Significantly Improved Construction Cost Visibility

Better Tools For Estimators Drive Significantly Improved Construction Cost Visibility

Better Tools are now availalble for construction estimators to drive significantly improved contruction cost visibility.

Approximately 90,000 line items with  locally researched labor, material, and equipment costs are essential for superior cost visibility.

Current data, available exclusive from Four BT, LLC (4Bt) offers granular, real-time insights into the actual cost dynamics specific to a project’s location. This approach captures variations due to local market conditions, regulations, and resource availability, which are often overlooked by generalized or aggregated cost indices, avaible from “traditional” “market leadering resources”.

With objective local data, stakeholders can more accurately estimate costs, make informed budgeting decisions, and mitigate the risk of cost overruns. This visibility is crucial for Lean construction, as it enhances cost transparency, enabling better planning, accountability, and more precise cost control.

 

significantly improved contruction cost visibility significantly improved contruction cost visibility

Why LEAN Construction Matters

Data Driven Cost Estimating

Engage in data driven cost estimating with objective, verifiable, and current local market labor, material, and equipment price books from 4BT (Four BT, LLC).

Approximately 90,000 line items including demolition lines and line item modifiers available within an easy-to-use web application.

improving mutl-trade construction cost estimates data driven cost estimating

Improving Multi-Trade Construction Cost Estimates

Improving Multi-Trade Construction Cost Estimates

Improving Multi-Trade Construction Cost Estimates is critical for any CM or real property owner.

Depending solely upon historical costs or subcontractor/trades quotes will not provide sufficient cost visibility or cost management capability.

Leveraging current, granular,  and locally researched labor, material, and equipment cost data enables CMs and real property owners to validate information, thereby improving multi-trade construction cost estimates.

improving mutl-trade construction cost estimates
Improving Multi-Trade Construction Cost Estimates is central to enhancing cost visibility and cost management

 

Advancing Construction Cost Estimating

Advancing Construction Cost Estimating

Advancing construction cost estimating data, tools, communications, and technology is central to achieving sustainable facilities management.

Traditional tools, such a national average cost data, location factors, historical costs, and spreadsheet no longer support today’s need for enhanced cost visibility, transparency, and management.

 

“Decisions made to adjust to  changing circumstances are all based on the data collected.”

While advancing construction cost estimating remains a challenge as it requires a change in the way things have been done in the past,  organizations who depend on facilities must be prepared for the journey.

Advancing Construction Costs Estimating Tools for Today and Tomorrow

  1. Local market research – To be relevant, construction cost data must reflect local market conditions.  This means specifically researching local labor markets across all trades, research local market materials to determine local, regional, and national interdependencies, and of course, equipment costs.
  2. Dynamic vs. static – Cost data is in continuous flux, therefore local market data needs to be research at least on a quarterly basis, or more frequently basis upon market conditions.
  3. Granularity – All cost data needs be presented a detailed, individual construction task data to provide the highest level of cost visibility and reliability.
  4. Objective – Using an independent resource for local market cost data avoid any potential bias or conflict of interest.
  5. Standard Format – Cost data represented using expanded CSI MasterFormat, with all description in plain English and using industry standard terms.

advancing contruction cost estimating

Inquire about the availability of Objective, Verifiable, Current, Local Market Construction Cost Data…

 

 

Collaborative Job Order Contracting

Benefits of Collaborative Job Order Contracting

The Benefits of Collaborative Job Order Contracting far exceed  “traditional” JOC Programs and their sole focus upon procurement.

Most current JOC Programs focus exclusively on procuring construction services faster.  As a result, they fail to provide the major benefits afforded by a collaborative approach and the use of objective, current, and verifiable labor, material, and equipment cost and task information, including…

  1.   Enablement and support of change management
  2.   Support for continuous improvement
  3.   Enhanced cost visibility and cost management capability
  4.   Development of long-term mutually beneficial relationships
  5.   Repeatable enhanced business processes
  6.   The basis for developing a shared knowledge base
  7.   Development of a new standard of asset management

Learn more about LEAN construction and 4BT’s OpenJOC (TM) collaborative Job Order Contracting solution.

Collaborative Job Order Contracting

 

Sustainable Lifecycle Building Management

Robust Management Practices Lead to Sustainable Lifecycle Building Management

ROBUST PRACTICES IMPROVE SUSTAINABLE LIFE CYCLE MANAGEMENT OF BUILDINGS

Sustainable lifecycle building management requires:

– Integrated Planning, Procurement, and Project Management Teams
– Owner Leadership, Capacity, and Commitment
– Common Data Environment – (Example: Objective, Current, Granular, and Locally Researched Labor, Material, and Equipment Costs and Tasks)
– Adoption and Continuous Improvement of robust Integrated Project Delivery frameworks, including collaborative Job Order Contracting (https://lnkd.in/gDZ8j_Pt).

The goal of sustainable development is to achieve a state of sustainability for society as a whole and for the planet.

Collaborative repair, renovation, maintenance, and new construction, sustainability and the life cycle management of buildings are interrelated.

hashtag#sustainable hashtag#buildings hashtag#management hashtag#facilitiesmanagement hashtag#lifecycle hashtag#costs hashtag#costmanagement hashtag#projectmangement hashtag#costdata

 

Sustainable Lifecycle Building Management
Productivity and innovation have a direct relationship with sustainability

 

BUILDING LIFECYCLE ELEMENTS  – Social, Economic, Environmental

1. Definition of physical and funtional needs including environmental needs and project
requirements (users) / Project Requirements Development.
2. Definition of planning, procurement, and project delivery execution methods and teams;
4. Construction
5. Use, operation and maintenance of the building; and
6. Demolition/Reuse

Construction and building management activities have a major effect on the environment, human health and the economy in general.

Environmental: Avoiding pollution, protectiing and
improving biodiversity, improving energy efficiency
and the efficient use of resources;

Social: Respecting staff/project participants, relationship with local
communities and establishment of long term, mutually beneficiao partnerships;

Economic: Increasing productivity/reducing waste  and improving/monitoring project performance
versus goals.

Real property owners must meet the challenges of sustainable building lifecycle mangement, continuous improvement, waste elimination, a stronger focus on the user, the need to increase the value for money coupled with high quality project management and improved supply chains and communications.

Traditional “project devlivery methods”, design-bid-build, design-build…  are limited and have low sustainability as they do not fully address aspects of people’s individual and collective behaviors.

Why LEAN Construction Matters

Target Value Deliery – How to Apply TVD with 5 Steps.

Target Value Delivery (TVD) is “a management practice that drives the (design and construction) to deliver customer values within project constraints” (Ballard, 2009).

How to apply TVD:

1. Early involvement and ongoing participation of owners, engineers, and design/builders.
2. A robust collaborative project delivery methods and associated written “execution guide” or “operations manual” as part of contractual documents that aligns mutually biennial goals and outcomes for all participants.
3. An objective, verifiable, and current, granular, locally researched database of labor, material, and equipment costs and tasks, shared by all participants and organized in a standardized, easily understood and manageable manner.  Learn more.
4. A centralized data repository and associated quantitative metrics
5. Initial and ongoing training for ALL participants and stakeholders.

Target Value Delivery

Target Value Delivery

Purchasing Job Order Contracting Audit 2024

Job Order Contracting Audit – Tampa 2024

The Internal Audit Department released its Purchasing Department – Job Order Contracting, Audit 24-12

The City of Tampa (City) established a Job Order Contracting program to facilitate the repair and rehabilitation of City facilities and infrastructure. The report in its entirety can viewed on TampaGov.net .

“The following steps were performed to determine the accuracy and relevance of the metrics
reported:
1. Identified the Gordian System as the source for the JOC metrics being reported.
2. Traced reported metrics to supporting documentation. “*

“AUDIT CONCLUSIONS
Based upon the test work performed and the audit findings noted below, we conclude that:
1. The system of internal controls related to the JOC program needs to be improved.
2. The administration of the JOC program needs to be improved.
3. The JOC program complied with the protocols for managing scope changes.
4. Performance metrics are relevant but not accurate.”*

Job Order Contracting Audit

* Source: PURCHASING DEPARTMENT JOB ORDER CONTRACTING AUDIT 24-12, City of Tampa, Internal Audit Department

 

When will State, County, and Local Governments learn?

Robust, service oriented Job Order Contracting Solutions – https://4bt.us/job-order-contracting-services-and-tools/

“There is currently no formal standard operating procedures (SOP) manual that documents the daily activities of the JOC program.”*
“The Performance Dashboard on Tampa.Gov erroneously reports dollars awarded as dollars spent for women/minority owned business enterprises (W/MBE) and small local business enterprises (SLBE) as metrics for the Job Order Contracting (JOC) program under the Purchasing Department.”*
“A review of the JOC program processes showed there is lack of segregation of duties in the administration of the program. We found that key tasks, responsibilities, and incompatible duties were being performed by an individual employee. For example, the employee has sole discretion in selecting contractors, obtaining documentation, completing job order reviews, scheduling final walk-throughs, verifying inspections, and overseeing final project activities.”*
“We found that contractors’ performance evaluations were not conducted during or at the close of every project. For example, we judgmentally selected three
Prime Contractors with JOC activities during the audit period to verify whether performance evaluations are being conducted. The results showed no performance evaluations are being
conducted for Prime Contractors.”*

Why LEAN Construction Matters

Validate a Construction Takt Plan

How to validate a construction takt plan:

Validating an “optimized” TAKT plan is challenging, if not impossible, without access to an objective and granular local market database of construction tasks that includes labor, material, and equipment requirements.


Here’s why this database is critical:
1. Accurate Resource Planning
Labor: Without detailed information on labor requirements for each task, it’s difficult to determine whether the TAKT time is feasible or if you have the right number of skilled workers available at the right time.
Materials: Precise material quantities and delivery schedules are essential to ensure that the right materials are on-site when needed, avoiding delays or overstock.
Equipment: The availability and allocation of equipment must be aligned with the TAKT plan to avoid bottlenecks.
2. Cost Management and Optimization
Cost Visibility: Granular data on tasks allow for better cost estimation and management. Without this, cost overruns are likely, and the TAKT plan may not be financially viable.
Transparency: Objective data provides transparency in cost management, which is crucial for stakeholders to trust the plan.
3. Feasibility of TAKT Time
Realistic Timelines: Granular data helps in setting realistic TAKT times by considering the actual time needed to complete each task under specific site conditions.
Adjusting for Variability: With detailed data, it’s possible to account for variations in productivity due to different factors, such as weather or site conditions, making the TAKT time more reliable.
4. Data-Driven Decision Making
Validation Through Data: An objective database allows for data-driven validation of the TAKT plan, ensuring that each aspect of the plan is grounded in reality rather than assumptions.
Benchmarking: The database can provide benchmarks from similar projects, offering a point of comparison to validate the plan’s realism.
5. Integration with Other Systems
Alignment with IPD, JOC, and other Lean methods: To fully integrate with other systems like Job Order Contracting (JOC) and Lean construction practices, having granular cost and task data ensures that the TAKT plan is not only optimized for efficiency but also aligned with broader planning, procurement, and project delivery and cost management strategies.Objective-Verifiable-Current Local Market Construction Task Data https://lnkd.in/eDBAAc4G
validating a construction takt plan Validate a Construction Takt Plan

 

 

 

Why LEAN Construction Matters

Actionable Construction Cost Data

The importance of actionable construction cost data cannot be overstated.  From preconstruction through procurement and project delivery, actionable construction cost data is required in order manage multiple aspects of any size repair, renovation, maintenance, or new build project.

Characteristics of actionable cost data:

  1. Organized using a standard data architecture – example CSI Masterformat
  2. Objective and verifiable
  3. Granular components – Individual construction tasks, each with a Description (in plain English and using industry standard terms), Unit of Measure, Labor type and cost, Material type and Cost, Equipment Type and Cost, Productivity rate (based upon associated crew)
  4. Locally researched – (national average cost data and location factoring provides insufficient cost visibility)
  5. Current – (Cost data should be updated quarterly at a minimum, or more frequently based upon market events)
Actionable Construction Cost Data
Locally researched current construction data provides a more dynamic and responsive cost management tool.

Granularity and Specificity:  Locally researched cost data offers detailed, project-specific information, capturing variations in costs within specific locals, regions, or even specific sites. It considers the exact materials, labor, and equipment required for the project’s location.  The use of construction cost indexes or area location factors, or other generalized adjustment factor does not capture these fine details, potentially leading to inaccuracies of up to 30% to 40%+ or greater.

Curret actionable cost is is critical in an economic environment where costs can fluctuate rapidly.  It is directly sourced from the market where the project is being executed. It can account for local variations in labor, material, equipment and site conditions.

Issues with National Average Cost Data

 

Why LEAN Construction Matters

Master Builder Concept, LEAN, and Job Order Contracting

Lean construction aims to embody the benefits of the Master Builder concept, as does Advanced Job Order Contracting, Integrated Project Delivery, and Alliance Partnering.

The Master Builder concept is an ancient approach to construction, where a single individual or entity is responsible for both the design and the construction of a project. This role encompasses all aspects of planning, architecture, engineering, and building, integrating both creative and technical responsibilities. Historically, the master builder was seen as a highly skilled craftsman and a leader who had deep expertise in all areas of construction, overseeing projects from inception to completion.

Key Characteristics:

  1. Unified Responsibility: The master builder held ultimate responsibility for the project, ensuring it met design intent, functioned properly, and was built to high-quality standards.
  2. Integration of Design and Construction: Unlike modern construction, where design (architecture) and construction are often separate entities, the master builder concept integrates both, allowing for seamless communication between design intent and execution.
  3. Holistic Vision: Master builders had a comprehensive understanding of the entire construction process, from material selection to structural integrity, which allowed them to create cohesive, well-executed projects.
  4. Historical Examples: Many iconic structures from ancient times including medieval cathedrals, Roman aqueducts, were built under the master builder model.

Modern Context

In modern construction, the master builder concept has evolved into initial concepts such as design-build, where a single entity manages both design and construction. While specialization and complexity have grown over time, the core idea of integrating design and construction to ensure quality, efficiency, and cohesion remains valued.

Today the Master Builder concept has evolved into frameworks like Integrated Project Delivery (IPD), where a single entity or team is responsible for both the design and construction of a project, and Advanced Job Order Contracting (example OpenJOC(TM) Open Job Order Contacting.  Although today’s construction processes are more specialized and fragmented than in ancient times, the underlying goal of integrating planning, design, procurement and project delivery/construction remains, aimed at improving efficiency, reducing conflicts, and enhancing project outcomes.

DoD Facilites Sustainment Practices

Key Modern Concepts Based on the Master Builder Idea:

  1. Design-Build (Partial Lean solution):
    • Single Entity Responsibility: In the design-build model, one company or a team is contracted to handle both the design and construction aspects of a project. This contrasts with the traditional design-bid-build approach, where design and construction are handled by separate entities.
    • Advantages: This integration helps to streamline communication, reduce delays, manage costs more effectively, and minimize disputes between designers and builders.
    • Collaboration and Efficiency: The design-build process fosters collaboration from the start, as the design team works directly with the construction team to ensure the design is feasible, constructible, and cost-efficient.
  2. Integrated Project Delivery (IPD):
    • Shared Risk and Reward: IPD is a highly collaborative approach that brings together the owner, designers, contractors, and often key subcontractors under one contract. All parties share the risks and rewards, fostering greater collaboration and innovation.
    • Technology Integration: The use of advanced technology, such as Building Information Modeling (BIM), enables better coordination between design and construction teams, echoing the holistic control the master builder once had over a project.
    • Focus on Outcomes: IPD aims to optimize project results, increase value to the owner, reduce waste, and maximize efficiency, aligning with the master builder’s role in ensuring the best possible outcomes.
    • Lean Construction Principles: Modern construction methods, especially those involving Lean principles, emphasize waste reduction, collaboration, and continuous improvement, which are aligned with the holistic vision of the master builder.
  3. Advanced Job Order Contracting (JOC):
    • Integrated Planning, Procurement, and Project Delivery: While JOC has been traditional used primarily as a method to speed procurement, when deployed more holistically, as a Broader Integrative Tool it can serve as a comprehensive tool that integrates planning, procurement, and project delivery, leveraging granular cost data to enhance overall cost management and project outcomes.  JOC can synchronize internal planning (like project scheduling and resource allocation) with external factors such as contractor selection and supply chain management. This creates a cohesive framework for managing projects, ensuring that all steps align with the broader organizational goals.
    • Single Source of Responsibility:  In a JOC, like in the Master Builder concept, there is a single point of responsibility for executing the construction projects. The contractor is on-call for various jobs under a pre-negotiated contract, making them the go-to for all construction-related tasks within the scope.  The JOC contractor is responsible for managing and delivering construction outcomes, similar to how a Master Builder would oversee and manage the entire building process.
    • Efficiency and Streamlined Processes:  JOC is designed to allow for quick mobilization and execution of smaller, repetitive construction tasks without the delays of traditional bidding. This reflects the Master Builder’s ability to directly execute or oversee work without the inefficiencies caused by fragmented responsibilities. The pre-established pricing models and workflows in JOC resemble how a Master Builder might rely on standardized processes to maintain efficiency and quality over a series of projects.  The costs data used however must me current, objective, granular, and directly based upon locally researched labor, material and equipment costs and not based upon national averages and/or cost factoring.
    • Ongoing Relationship and Collaboration: In JOC, the contractor maintains an ongoing relationship with the client (often public instituion) over time, addressing multiple projects under a single contract. This ongoing collaboration is akin to the long-term relationship a Master Builder might have had with a patron or community, handling multiple construction tasks as needed.  The contractor becomes familiar with the owner’s needs and preferences, which can improve project outcomes—similar to how a Master Builder’s understanding of the client and their vision would contribute to success.
    • Objective, Granular Cost Data: One of the significant advantages of JOC is its ability to leverage current, verifiable cost data. The use of unit price books (UPBs) or other cost databases provides a transparent, accurate picture of costs for various tasks. This aligns with the need for cost visibility and transparency you mentioned earlier, which is crucial for effective cost management, especially in a Lean construction context.
    • Enhanced Cost Management: By using real-time, detailed cost information, JOC enables better cost prediction, tracking, and control. This can help avoid the common pitfalls of cost overruns or inaccuracies seen in more traditional models. The availability of such data also helps improve decision-making during the design and construction phases, similar to how the Master Builder’s deep knowledge ensured efficient project delivery.
    • Project Delivery Improvement: By fostering a streamlined and collaborative environment, JOC can help integrate project delivery processes with cost data and procurement in a way that improves efficiency, reduces waste, and leads to better project outcomes. This approach creates a feedback loop where data from completed projects inform future planning, creating continuous improvement in the process.
      • Efficiency and Control: Like the Master Builder, JOC allows for efficient execution, particularly for recurring or similar types of projects. The focus on efficiency and managing resources well, without the delays of traditional procurement methods, is a shared characteristic.
      • Continuity and Expertise: The long-term relationship between the JOC contractor and the client is somewhat analogous to the ongoing role of a Master Builder, who would have been relied upon for various construction needs over time.
      • Modern Applications of JOC Reflecting Master Builder Concepts:
        In summary, JOC shares some aspects of the Master Builder concept, particularly in terms of efficiency, single-source responsibility, and continuity.  It focuses on efficient, pre-planned construction tasks, often based on existing designs or minor modifications, and collaboration between owners and design-builders.  When implemented fully, JOC can integrate planning, procurement, and project deliver professionals.  JOC’s ability to integrate these elements makes it a powerful tool not only for procurement but also for project delivery and cost management, much like the holistic oversight of a Master Builder in modern terms.

Comparison with Historical Master Builder:

  • Specialization: Modern projects often involve highly specialized roles (architects, engineers, contractors, etc.), unlike the generalist master builder of the past. However, these specializations are now more integrated under frameworks like design-build or IPD or advanced Job Order Contracting
  • Collaborative Tools: The use of robust processes, actionable data, and advanced technology enables a level of precision and collaboration that the historical master builder could only achieve through deep personal expertise and oversight.

In essence, the modern construction industry’s shift toward more integrated, collaborative delivery models mirrors the holistic approach of the ancient master builder, but leverages modern technology and organizational frameworks to manage the complexity of today’s projects.

 

 

 

 

uilding Collisions Kill Over One Billion Birds Annually

Buildings Over One Billion Birds Annually in U.S. Alone

A recent study has confirmed Buildings Kill Over One Billion Birds Annually – Building Collisions Kill Over One Billion Birds Annually in U.S..

Buildings Kill Over One Billion Birds Annually
Buildings Kill Over One Billion Birds Annually

Birds collide with buildings as they largely cannot see or recognize glass.  Inexpensive window treatments are available to mitigate the problem.

Report reference

Report https://4bt.us/wp-content/uploads/2024/08/2023-Report.pdf https://4bt.us/wp-content/uploads/2024/08/BUildingsKillOneBillionBirdsjournal.pdf

 

via 4bt.us

Why LEAN Construction Matters

STOP Thinking about ACCURATE CONTRUCTION COST ESTIMATES

Isn’t it time for owners, designers, engineers, and builders to STOP thinking about accurate construction cost estimates?

The fact of the matter is that there is no such thing as an “accurate construction cost estimate”. 

Measuring accuracy requires a reliable reference point or datum.  In construction cost estimating there is no such value.  Many mistakenly use the actual build cost, others use historical costs, while other depend upon experience to measure some level of accuracy.  None of these can serve as a datum.  Bad datums provide poor measurements.

A construction cost estimate, however, can and should be Objective, Current, Granular, and reflect LOCAL Market Labor, Material, and Equipment costs.   A detailed, line items estimate using this information provides the highest level of cost visibility, transparency, and management possible.

A detailed line item cost estimate using objective, current local market granular line item construction task data delivers should therefore be used prior to the procurement of ANY repair, renovation, maintenance (including preventive, routine, etc.), and new construction service.  This is especially true for public sector organization where fiduciary responsibility is a legal and professional requirement.

 

accurate construction cost estimates
Creating “accurate” construction cost estimates is impossible, however, they can be “objective”, “verifiable”, “granular”, and reflect local market labor, market, and equipment costs.

accurate construction cost estimates accurate construction cost estimate accurate construction cost estimate

 

Sustainability and Preventive Maintenance = Environmental Stewardship

Sustainability and Preventive Maintenance = Environmental Stewardship

Sustainability and Preventive maintenance are linked in several ways:

Building account for around 40% of global greenhouse gas emissions.  

Day-to-day operations of buildings can account for three-quarters of real estate’s overall carbon footprint.

Developing and implementing the right preventive maintenance strategy can deliver significant savings across ongoing operating costs and reduce consumption of nonrenewable resources and lower CO2 emmissions.

Sustainability and Preventive maintenance are linked in several ways; Energy Efficiency, Resource Conservation, Waste Reduction, Environmental Impact, Health and Safety, Cost Savings, and Compliance and Standards

  1. Energy Efficiency:
    • Regular Equipment Servicing: Ensures that HVAC systems, lighting, and other energy-consuming equipment operate at peak efficiency, reducing energy consumption.
    • Upgrades and Replacements: Regular inspections can identify opportunities for upgrading to more energy-efficient models or implementing energy-saving technologies.
  2. Resource Conservation:
    • Water Systems: Maintenance of plumbing systems can prevent leaks, ensuring efficient water use and reducing waste.
    • Material Longevity: Proper upkeep of building materials (e.g., roofs, windows) extends their life, reducing the need for replacements and conserving resources.
  3. Waste Reduction:
    • Avoiding Major Repairs: By addressing minor issues before they become major problems, preventive maintenance reduces the amount of waste generated from large-scale repairs or replacements.
    • Inventory Management: Regular checks can optimize the use of supplies and materials, minimizing excess and waste.
  4. Environmental Impact:
    • Pollution Control: Well-maintained equipment and systems are less likely to cause environmental pollution through leaks, emissions, or inefficient operation.
    • Sustainable Practices: Incorporating sustainable maintenance practices, such as using eco-friendly cleaning products and materials, can further reduce the environmental footprint.
  5. Health and Safety:
    • Indoor Air Quality: Regular maintenance of HVAC systems and proper ventilation ensure good indoor air quality, promoting health and reducing the need for energy-intensive air purification.
    • Structural Integrity: Maintaining the structural components of a facility prevents degradation that could lead to unsafe conditions and costly emergency repairs.
  6. Cost Savings:
    • Operational Efficiency: Efficient systems and equipment lead to lower operational costs, freeing up resources for further sustainability initiatives.
    • Avoiding Downtime: Preventive maintenance reduces the likelihood of unexpected breakdowns, ensuring continuous operation and productivity.
  7. Compliance and Standards:
    • Regulatory Compliance: Regular maintenance helps ensure that facilities meet environmental and safety regulations, avoiding fines and promoting sustainable practices.
    • Sustainability Standards: Adherence to sustainability standards and certifications (e.g., LEED) is facilitated by a robust preventive maintenance program.

Requisite Preventive Maintenance Tools

  1. Written Preventive Maintenance Plan
  2. Detailed Facility Condition Assessment and Asset Inventory
  3. Job Order Contract or similar integrated project delivery method
  4. Locally researched preventive maintenance cost database
  5. Integrated CMMS technology

#1.  Written Preventive Maintenance Plan – Real property owner leadership, support, and accountability relative to a facilities portfolio preventive maintenance plan as well as strategies, processes, documentation, and metrics should be communicated to all participants and stakeholders with a written PM Operations Manual or PM Execution Guide.

#2.  Detailed Facility Condition Assessment and Asset Inventory –  A detailed FCA and an associated inventory of facility related assets are needed to prioritize maintenance activities when compared against the organization mission requirement.

#3. JOC Program or similar integrated project delivery method –  Efficient planning, procurement, and project delivery related to the numerous, ongoing preventive maintenance tasks associated with a facilities portfolio requires a well-designed and well managed integrated process framework.  Job Order Contracting enables the rapid, and efficient planning, procurement, and project delivery of these tasks when properly leveraged.

#4. Locally researched preventive maintenance cost database  –  To ensure cost visibility and cost management, as well as the appropriate action items for each preventive maintenance task required, an objective, locally research database inclusive of labor and material information and costs, and checklists for each frequency of  every task are needed.

#5. Integrated CMMS technology – CMMS technology can play a role with respect to gathering and managing asset inventory as well as scheduling PM tasks.  Unfortunately, most applications of CMMS technology fail due to the lack of one or more of the above items.

 

preventive maintenance sustainability

 

By proactively addressing potential issues, preventive maintenance supports the long-term sustainability of facilities, ensuring they operate efficiently, safely, and in an environmentally responsible manner.

 

Learn more about optimiziting preventive maintenance, sustainability, and associated cost management.

Why LEAN Construction Matters

FSRM – Facilities Sustainment, Restoration, and Modification

Facilities Sustainment, Restoration, and Modification (FSRM)

Peter Cholakis

Peter Cholakis

Improve facilities repair, renovation, maintenance, and new build outcomes and reduce costs

WHAT?

Facilities sustainment – The maintenance and repair activities necessary to keep an inventory of facilities in good working order. It includes regularly scheduled adjustments and inspections, preventive maintenance tasks, and emergency response and service calls for minor repairs. It also includes major repairs or replacement of facility components (usually accomplished by contract) that are expected to occur periodically throughout the lifecycle of facilities. This work includes regular roof replacement, refinishing of wall surfaces, repairing and replacement of heating and cooling systems, replacing tile and carpeting, and similar types of work. It does not include environmental compliance costs, facility leases, or other tasks associated with scheduled adjustments and inspections, preventive maintenance tasks, and emergency response and service calls for minor repairs.

Restoration – Activities required to bring a facilities to such a condition that it may be used for its designated purpose. Restoration includes repair or replacement work to restore facilities damaged by inadequate sustainment, excessive age, natural disaster, fire, accident, or other causes.

Modernization – The alteration or replacement of facilities solely to implement new or higher standards, to accommodate new functions, or to replace building components that typically last more than 50 years (such as the framework or foundation).

WHY?

Robust FSRM activities are required to efficiently manage the lifecycle of a portfolio of facilities and associated physical infrastructure.

Most public sector agencies fail to achieve optimal performance and cost-efficiency due to a lack of understand of implementation of robust and integrated Planning, Procurement, and Project Delivery frameworks. A strong FRSM program is required to drive significant long-term organizational financial and mission benefits and aids in compliance and sustainability efforts.

HOW?

The Importance PEOPLE, PROCESS, INFORMATION, and TECHNOLOGY

1. Holistic View of Asset Management

PEOPLE – A primary focus upon PEOPLE is the first step towards sustainable facilities management. First and foremost, leadership must be capable, committed, and accountable with respect to the implementation of a holistic approach to physical asset management.

PEOPLE Focus

Significant change management is needed to shift from archaic and waste planning, procurement, and project delivery methods and practices. The fundamental change in attitudes and processes needed to achieve significant improvement represents a formidable if not impenetrable barrier to most public sector organizations.

Internal and external teams must be capable and willing to collaborate, share technical and financial data, and work towards mutually beneficial goals. Internal and external planning, procurement, and project delivery teams must work in a complementary manner.

PROCESS – A programmatic process, applied to each and every project and workorder. Whether a repair, renovation, maintenance, or new build activity, each must follow a defined workflow with appropriate requirements and approvals are each process stage from planning through completion. A root cause of failure for most projects is the lack of a well-defined, granular Scope of Work (SOW) that is communicated in standardized manner to all participants and stakeholders. It is this lack of financial and technical visibility that drives project failure resulting in delays, cost overruns, and dissatisfaction among parties.

Process requirements include:

#1. Predefined workflow for all projects, regardless of type.

#2. Defined documentation and approvals for all project phases.

#3. Common shared date environment, including current, objective, and verifiable locally researched granular labor, material, and equipment cost data.

#4. Quantitative performance monitoring.

Robust PROCESS

INFORMATION – A shared common data environment that is shared by all participants and stakeholders is needed to support timely and appropriate decision-making. This includes the use of a common, industry-standard glossary of terms and definition as well as the use of standard data architectures such as expanded CSI MasterFormat, expanded UNIFORMAT, etc.

TECHNOLOGY – Technology is an enablers, not a driver. The role of technology is to enable consistent, lower cost deployment and execution of PROCESS. Far too often technology is viewed as a solution and/or major focus relative to change management.

2. Cost Efficiency and Budgeting

The statement “you cannot manage what you do not manage” is directly applicable. Most organizations have zero cost visibility or transparency. How can this be? Simple. Cost visibility can only come from one source, current, objective, and verifiable local market labor, material, and equipment costs. Verifiable cost information cannot be found in contractor or subcontractor quotes, historical data, or national average cost data. Unfortunately, most public sector organizations do not understand this basic fact.

By understanding these financial implications upfront, planning, procurement, and project delivery professionals can allocate budgets more effectively, avoiding unexpected expenses and optimizing investment returns.

3. Enhanced Maintenance Planning

Effective maintenance planning is crucial for the longevity and performance of a building. Preventive maintenance is one of least quantitatively managed processes , leading to system excessive system failures and poor use of organizational financial resources.

Details schedules, inclusive of frequency and equipment driven checklists as well as labor and material details and costs are central to efficient and effective preventive maintenance programs.

SUMMARY

By having a clear understanding programmatic facilities sustainment, real property owners and facilities managers can better plan for and anticipate costs, potential issues, and implement risk mitigation strategies. This quantitative proactive approach minimizes disruptions and maintains the safety and functionality of the facility as well as maximizes decision-making capabilities and the associated the use of available resources.

Those who embrace a dynamic, quantitative approach to FSRM will be better equipped to meet the challenges and opportunities ahead, ensuring the sustainment and success of their organizational mission.

Construction Cost Data Information

Construction Cost Data Information

Current, objective, verifiable, and detailed construction cost data is critical to achieving any useful level of cost visibility and cost management.   The fact that detailed unit price cost estimates using this type of information is rarely used and shared among owners and design/builders is largely responsible for cost overruns.

“National average price books” are wide used by both owners and design/builders, however, cannot provide an adequate representation of local market conditions.  Attempts to localize information using “location indexes” have be proven to be insufficient.   As a result, users of national average price books generally attempt to compensate by attempting to add extra hours to the work to be performed.  This practice is of course problematic, especially when JOC/SABER and related contracts are involved and being managed properly.  Unfortunately, alternative methods of compensating for a national average cost book include  inflate quantities and/or to adding unnecessary activities.

The benefits of using a standardized unit price book however are clear.  They provide a method to simplify and accelerate estimating and negotiating of construction work orders by locking in certain variables, such as crew mix, labor hours, equipment types and hours to perform various activities. This helps define some level of fair and reasonableness.

Solution

Current, locally researched unit price books (UPBs) are now available that are updated quarterly and organized using expanded CSI MasterFormat.  These local market UPBs improve cost visibility by 30%-40%+ thus providing a significant benefit to both owners and design/builders.   As both owners and design/builders now have greater cost visibility and risk is lowers, overall project costs can be reduced.

Furthermore as material, labor, and equipment costs can vary widely, the concept of have a UPB that is updated quarterly again significantly reduces risk to all parties involved.

Notwithstanding the abovie, using generic equipment types and output often represent only one solution and don’t necessarily reflect an organization’s owned equipment inventory or what they might actually rent.  Firms such as Four BT, LLC (4BT) are responsive in this regard and provide for the ability to research and update a UPB in a timely manner.

Summary

While historically using a “national average cost book” with or without location factoring has proven ineffective, generally resulting in over priced work, performance, and cooperation issues, the availability on current, objective, locally researched cost data has significant mitigated these issues.   These locally researched unit price cost databases greatly improve cost visibility and cost management capabilities for all parties.  They can even be used to validate subconstractor quotes.

Construction Cost Data Information
Construction Cost Data Information

 

 

 

Why LEAN Construction Matters

Aggregates Pricing – Crushed Stone

Construction Aggregates

The U.S. Geological Survey (USGS) defines the construction aggregates industry as those companies that mine and process crushed stone and (or) construction sand and gravel. Construction aggregates are an essential part of the construction industry and serve as an indicator of the strength of the industry. All 50 U.S. States produce construction aggregates. The USGS National Minerals Information Center (NMIC) collects construction aggregates data from producers that voluntarily complete canvass forms for the survey and estimates production data for nonrespondents based on the Mining Health and Safety Administration worker hours. In 2022, a total of 1,400 companies operating 3,585 quarries and 333 sales/distribution yards produced crushed stone and 3,360 companies operating 6,500 pits and 292 sales/distribution yards produced construction sand and gravel.

Data Set

Data set contains the following information on construction aggregates standardized to metric tons (t) and dollars per metric ton ($/t):

  • Production (quantities sold or used) by State
  • Unit value
  • Types of Stone
  • End Uses

aggregate pricing

via 4BT.us – Objective, current, granular construction cost data  https://4bt.us/unit-price-book/

 

and project delivery integration

6 Steps to Construction planning, procurement, and project delivery integration and significantly improved outcomes.

Construction planning, procurement, and project delivery integration is a prerequisite to the consistent delivery of quality facilities repair, renovation, maintenance, and new build project on time and on budget.

Failure to achieve the above is the #1 reason for the  rampant waste endemic to public sector organizations.

Achieving integration and collaboration among internal and external groups is far from complex.  The formidable barrier, however, is that is does require change from the ‘status quo’.

All repair, renovation, maintenance, and new builds struggle at the onset at the interfaces of planning, procurement, and project delivery teams.  Specifically, managing and leveraging the dependencies between various disciplines like planning, design, engineering, procurement, project management, builders, and other service providers remains the greatest challenge to most organizations and a common failure point.   Failure to address the issue at a programmatic levels is the cause of rework, delays, cost overruns, churn, and poor relations for all involved.

Robust solutions exist to resolve the above which  improve collaboration, communication, and coordination through the transparent, proactive management of all interfaces and participants.  All these solutions share the following fundamental requirements and elements.

#1. Owner leadership, capacity, commitment, and accountability

#2. A common programmatic approach and process applied to all projects.

#3. A written execution guide as part of a multi-year collaborative agreement that focus upon mutually beneficial outcomes, transparency, trust, and performance.

#4. A common, shared data environment inclusive of current, locally researched labor, material, and equipment granular data organized via a standard data format (expanded CSI Masterformat).

#5. Mandatory initial and ongoing training for all.

#6. Quantitative performance metrics.

Construction planning, procurement, and project delivery integration

Construction planning, procurement, and project delivery integrationConstruction planning, procurement, and project delivery integration

Learn more?

www.4bt.us

 

JOC Program Management Solution

4BT JOC Program Management Solution

Why consider the 4BT JOC Program Management Solution?

 

1. Critical management functionality
2. Current, objective, verifiable, LOCAL MARKET labor, material, and equipment costs
3. Achieves unparalled value, cost savings, and ROI
4. Builds and retains owner and design-builder knowledge

 

JOC Program Management JOC Program Management

and harness

FM Professionals engage, inspire, and harness the full potential of your teams

It’s critical that FM professionals engage, inspire, and harness the full potential of internal and external teams.

Communicate vision, purpose, mission, and strategy for your organization clearly, directly, and continuously.

FM Productivity Solution – Technology

 

#1.  Collaborate and communicate at speed and scale.

#2. Ensure cost visibility and cost management capability.

#3. Leverage robust processes and common data architectures.

#4. Be a passionate, truly inspiring, and accountable leader!

Outsourcing important FM tasks is a surefire way to erode stakeholder and team trust. 

DoD Facilites Sustainment Practices

 

Learn more…

 

Objective Verifiable Construction Cost Estimates

Unlocking the door to Objective Verifiable Construction Cost Estimates

Unlocking the door to Objective Verifiable Construction Cost Estimates is now possible with current, locally research line item labor, material, and equipment data from Four BT, LLC (4BT).

 

An important construction cost estimating improvement is the use of current, objective, verifiable, and locally researched granular labor, material, and equipment construction tasks.

If you use “Sage” or “RS Means”, isn’t it time time to consider improving your cost visibility and cost management capabilities?

Using “traditional” cost estimating solutions is no longer viable in today’s volatile and competitive landscape.  It’s no longer the “safe option” using so call “market leaders”.  There is now a construction cost estimating improvement that benefits both owners and design-builders.

Construction Cost Estimating Improvement including locally researched, objective, current, granular labor, material, and equipment info.

  • Locally researched granular construction line items updated quarterly
  • Ability so copy, share, reuse estimates with multiple databases
  • Create and save assemblies
  • Export to Excel with formulas and “add-ons” or PDF
  • Easy to use estimate builder
  • Secure, web technology

Objective Verifiable Construction Cost Estimates

All trademarks and rights remain solely with their respective owners.

Verifiable Construction Cost Estimates
Verifiable Construction Cost Estimates

Balancing Job Order Contracting Objectives and Costs

Balancing Job Order Contracting Objectives and Costs

Balancing Objectives and Costs for Job Order Contracting is often overlooked by most organizations.

  • Are you consistently achieving quality on-time, on-budget repair, renovation, maintenance, and new build outcomes at a reasonable cost?
  • Do you have full, verifiable, objective cost visibility?
  • Are you using just to simply speed the procurement process?
  • Are you paying a “JOC Consultant” a percentage of JOC construction volume?

Balancing Objectives and Costs for Job Order Contracting in alignment with an organization’s overall mission is a critical consideration for any JOC Program.

The need to balance short-term and long-term investments in alignment with an organization’s overall mission and objectives is a critical consideration for any JOC Program.  Far too often, however, JOC is viewed simply as a means to speed procurement resulting in excessive costs and little strategic value to an organization.

Learn more?

Balancing Job Order Contracting Objectives and Costs
Balancing Job Order Contracting Objectives and Costs
Construction Cost Estimating Improvement

Major Construction Cost Estimating Improvement

An important construction cost estimating inprovement is the use of current, objective, verifiable, and locally researched granular labor, material, and equipment construction tasks.

An important construction cost estimating improvement is the use of current, objective, verifiable, and locally researched granular labor, material, and equipment construction tasks.

If you use “Sage” or “RS Means”, it’s time to consider improving your cost visibility and cost management capabilities.

Using “traditional” cost estimating solutions is no longer viable in today’s volatile and competitive landscape.  There is no longer “safety: is using so call “market leaders”.  There is finally a construction cost estimating improvement that benefits both owners and design-builders.

Construction Cost Estimating Improvement including locally researched, objective, current, granular labor, material, and equipment info.

  • Locally researched granular construction line items updated quarterly
  • Ability so copy, share, reuse estimates with multiple databases
  • Create and save assemblies
  • Export to Excel with formulas and “add-ons” or PDF
  • Easy to use estimate builder
  • Secure, web technology
Construction Cost Estimating Improvement
Major Construction Cost Estimating Improvement

 

  • Enable internals and external estimating teams to collaborate, and gain insights
  • Create and share detailed Scope of Work information
  • Validate contractor and subcontractor estimates
  • Simple-to-use web interface
  • Cloud-based multi-user platform
  • Mitigate risk
  • Improve owner/design-builder collaboration
  • Take your estimating to the next level!

 

Trademarks remain under their respective ownership.

Improving Construction Services Procurement

Improving Construction Services Procurement – JOC

Improving Construction Services Procurement is critical to sustainable facilities management.  JOC, Job Order Contracting can play a major role, if, JOC Programs as not used to simply “speed procurement” and robust, collaborative processes are leveraged.

Effective construction services procurement capability is critical to sustainable facilities lifecycle management.

4BT’s tools and services are specifically designed to provide a lower cost, higher performing Job Order Contracting Solution. Instead of a sole focus upon faster procurement, the firm enables on-time and on-budget quality outcomes by integrating planning, procurement, and project delivery team within a robust environment. They offer a better alternative to a monopolized JOC market with excessive administration costs based on percentage fees of total JOC construction volume.

Four BT, LLC (4BT), a certified veteran-owned small business (VOSB), was founded in 2016 by JOC program management, technology, and cost data experts with decades of experience with traditional sector leading organization, including the RS Means Company, LLC; 4Clicks Solutions, LLC; and VFA, Inc.

4BT provides a complete range of Job Order Contracting and Integrated Project Delivery solutions, tools, and professional support services:

• Enterprise knowledge management technology
• Local market, current, granular construction cost data inclusive of line-item modifi ers, organized using expanded CSI Masterformat
• Preventive maintenance tasks, checklists, and costs for all associated frequencies organized using expanded UNIFORMAT
• Construction technical specifi cations
• Consulting
• Multi-format, multi-level industry leading training
• 24/7 Support services
• Customization

Improving Construction Services Procurement

Four BT, LLC (4BT) 84 Cottonwood Lane, Naples, FL 34112-7230 | (903) 326-9965 | Certifi cations: VSOB www.4bt.us

Job Order Contract Cooperatives

Job Order Contract Cooperatives – WHEN and HOW to Use Them

JOC Cooperatives enable organizations to speed the procurement of renovation, repair, maintenance, and new construction services (based upon applicable statutes) using a “Master Agreement” and within the basic structure/process of an “owner managed” JOC Program.

The diagram below represents a process workflow within which a member organization (school, hospital, DPW, college, courthouse, city…)  requests a proposal from an approved JOC contractor and then makes an award decision.

JOC Cooperative

A few things organizations should know when considering or evaluating a JOC Cooperative…

 

#1. A JOC Cooperative is best used when the annual total “construction value” is anticipated to be less than $2-3M for all associated projects/workorders.   If the annual total construction volume exceeds this level, and owned-management JOC Program is likely the most efficient method.

#2. Beware of the costs associated with using a JOC Cooperative.  There also may be “hidden fees” being charged to the awarded JOC Contractors that nonetheless end up being owner costs.  In most cases, if the total cost of JOC Cooperative administration exceeds 2% of the total project value, the cost is too high and alternatives should be researched.

#3. Ensure that object, current, granular local market construction cost data is being used by the JOC Cooperative.  Outdated cost information, or national average cost data and the use of local or economic factoring generally will not provide adequate cost visibility.  Furthermore, “static” unit price books (UPB, UPBs) or static “construction task catalogs” should be avoided.  It is recommended that UPBs be updated annually at a minimum, and quarterly if possible.  This procedure mitigates risk for both owners and design-builders and improve overall efficient use of capital.

#4. JOC Cooperative policies and procedures are critical.   Does the JOC Cooperative Program REQUIRE that a compliance audit be done for EVERY contractor estimate prior to the award by an owner?   Is there an optional service available to have a fully independent line-item audit of a contractor estimate including quantities and line-item content?   Ensuring that every contract awarded to a contractor is in compliance with the Job Order Contract is a responsibility of every public sector owner.

#5.  Is the JOC Cooperative run buy a “for profit” enterprise or a government entity?   For example, The Allied States Cooperative / ESC-19  is a national governmental purchasing cooperative which competitively bids and awards contracts to local, regional, and national vendors in compliance with local, state, and federal procurement laws and regulations.  Contracts are available to public schools, charter schools, private schools, community colleges, universities, cities, counties, other governmental agencies, and non-profits.  No fees are charged to the Allied States Cooperative members. As a member, your entity deals directly with the vendor who can provide the goods and/or services you may require. The savings for members are realized through dealing with vendors who have been evaluated and verified to provide a quality product or service at a competitively bid price in compliance with bidding requirements.

Why LEAN Construction Matters

GSA PBS JOC Program Management Audit – Issues Continue

GSA PBS JOC Program Management Audit – Issues Continue:  The General Services Administration (GSA) Public Buildings Service (PBS) has faced scrutiny and criticism in the past for various financial and management issues, including those related to Job Order Contracting (JOC) programs.

Financial Management Issues

  1. Budget Overruns: There have been instances where projects managed by GSA PBS exceeded their budget estimates, leading to increased costs and financial inefficiencies.
  2. Mismanagement of Funds: Audits and reports have sometimes highlighted improper use or allocation of funds, affecting the overall financial health of the agency.
  3. Lack of Accountability: Poor financial tracking and reporting mechanisms have occasionally resulted in a lack of accountability for spending, making it difficult to identify and rectify financial mismanagement.

Job Order Contracting (JOC) Program Management Issues

  1. Inefficient Contracting Processes: Delays and inefficiencies in the contracting process have been a recurring issue, affecting the timely execution of projects.
  2. Lack of Oversight: Inadequate oversight and monitoring of JOC projects can lead to quality control issues and deviations from project specifications.
  3. Contractor Performance: Problems with contractor performance, including failure to meet deadlines and deliver quality work, have been reported. This can be attributed to both the selection process and insufficient management of contractors.
  4. Cost Control: Challenges in controlling costs within the JOC program have led to budget overruns and financial inefficiencies, similar to broader financial management issues within the GSA PBS.  GSA continues to use national average cost data and location factoring for JOC Programs, despite the availability of objective, verifiable, current, granular construction labor, material, and equipment construction task data that is locally researched.

Addressing these issues often requires systemic changes, improved oversight, and stronger accountability mechanisms to ensure better financial and program management.

GSA PBS JOC

GSA PBS continues to faces challenges with the management of JOC Programs and cost control. A recent assessment highlighted deficiencies in pricing for the PBS Southeast Sunbelt Region’s Job Order Construction contracts. The audit revealed inflated or unsustainably low pricing due to flaws in price analyses. Inappropriate use of flawed pricing also impacted project cost estimates. Find out more in the memorandum: [Link to the memorandum](https://lnkd.in/eVmEKpgz)

Robust Construction Productivity Tools

Robust Construction Productivity Tools

Robust construction productivity tools are now available to measurably reduce overall costs by 30%-40%+.

We all know that the ability to consistently plan and executive on time, on budget, and quality repair, renovation, maintenance, and new builds requires focus upon and the integration of PEOPLE, PROCESS, INFORMATION, and enabling TECHNOLOGY.

90%+ of ALL projects fail due to poor preconstruction processes.

 

Solution

#1. Deploy an appropriate collaborative construction delivery method  and associated processes consistenty for ALL projects.   Project vary, however, process should not!  Think a programmatic approach versus a project approach.  Communicating effectively on an early and ongoing basis with ALL project participants and stakeholders enables organizations to realize the raw power of collective knowledge in support of organizational mission and vision.

Leaders who consistently communicate the strategy and tactics in plain language, and link the organization’s initiatives and required progress, help inspire and motivate internal and external teams, keeping them focused and working together toward success.

 

#2. An incomplete and/or poorly communicated Scope of Work and the lack of an associated Common Data Environment is the also the root cause of failure.   This aspect is directly related to #1, as a robust collaborative project delivery methods mandates a detailed, well communicated granular Scope of Work, presented in plain English, using industry standard teams, and shared with all participants early in the planning, procurement, and project delivery lifecycle.

Learn more…

DoD Facilites Sustainment Practices

 

Sustainable Facilities Management and Leadership

Sustainable Facilities Management and Leadership

Sustainable facilities management and leadership are inseparable.

This is not only a fact, but a significant barrier to efficient life-cycle management of the built environment.

Committed, competent, and accountable real property owner leadership is a fundamental requirement for enabling the change that must occur throughout the AECOO community.  While we are all aware that the traditional processes used for decades are extremely wasteful from both environmental and economic perspectives, there has been no measurable shift in leadership practices to drive requisite change.

Despite that fact that robust processes and tools are readily available to improve productivity 30%-40%+, they will remain unused without appropriate leadership.   A focus upon PEOPLE, PROCESS, INFORMATION, and enabling TECHNOLOGY, and in that order, is needed, however, likely foreign to traditional organizational leadership.

Sustainable Facilities Management and LeadershipSustainable Facilities Management and Leadership

If your organization is ready for Sustainable Facilities Management and Leadership that supports requisite change…

 

DoD Facilites Sustainment Practices

DoD Facilities Sustainment Practices NOT KEEPING PACE with Changing Landscape

Fact:  DoD Facilites Sustainment Practices NOT KEEPING PACE with Changing Landscape

 

Delivering integrated and transparent Sustainment Capability must be a priority!  Integrated and
outcome-based performance-based planning, procurement, and project delivery teams are needed to drive progress towards required cost effective Sustainment capabilities, capacities, and operational outcomes.  This is only possible with the full support accountable leadship leveraging existing robust governance frameworks, s throughout the DoD Sustainment enterprise.

 

Unfortunately, the above is true for non-DoD federal agencies/departments also.

As simple example is PPC, also known as Percent Plan Complete.   PPC is a crucial aspect of Lean philosophies and practices like “Last Planner” and has been a part of DoD FM project management for decades.

For PPC to be effective, however, a detailed Scope of Work with construction tasks, labor, materials, equipment details, and local market costs is essential.  Most DoD and non-DoD organizations fail to use objective, verifiable, and current granular local market construction labor, material, and equipment information, organized in a fully standardized and transparent manner.

In short, “you cannot manage what you do not measure”.  The Federal Sector has no verifiable method for repair, renovation, maintenance, and new build cost transparency, visibility, or management.

DoD Facilites Sustainment Practices

Sustainable management of the built environment demands a consistently applied programmatic approach.

Everyone MUST DO BETTER.

Learn more about unit pricing and cost management here: https://lnkd.in/eDBAAc4G and here: https://lnkd.in/exRbeYAX

PPC LeanPhilosophy SustainableManagement construction costdata costmanagement lastplanner lps lean sustainment

Relearn Construction Cost Estimating

Relearn Construction Cost Estimating – 4 Critical Learnings

It’s time to relearn construction cost estimating.

Before relearning construction cost estimating, it’s important to hit your resent button.  The following represent the new realities.

  1. Technology will not solve your problems.  Tech is an enablers.
  2. People, Process, and Information are the three kings.  Focus on working with professions with experience, yet willing to learn, listen, and share information.  Robust process is critical.  Move away from “project-based thinking”, to program thinking.  This simply means, fundamental steps/workflows work for ALL projects.  Stick with them.  As to information, there is only one critical aspect.   Use and share objective, granular, current, and locally researched line item data that is organized using a standard data architecture (for example, expanded CSI Masterformat).
  3. Focus on a developing a detailed Scope of Work from day one and work collaboratively with all constituencies (owners, design-builders, planners, procurement, facilities management…).
  4. Work as part of an integrated planning, procurement, and project delivery team.

Also remember that there so NO SUCH THING as an “accurate construction estimate.”   Turn and run from any estimator, vendor, or consultant who claims to be able to provide one.   Construction estimates can be detailed, verifiable, and objective but NEVER accurate.   Why?  It’s simple.  Accuracy is how close a given set of measurements (observations or readings) are to their true value.   Thus what is the “true value” or “datum” to enable the computation of accuracy?  Well, there isn’t one.   Certainly its not the final construction cost.   There are far to many variables to assume that the final construction cost can be used.  Certainly not “like projects” as the statistical significance again is low.

The ability to enable sustainable repair, renovation, maintenance, and new construction relies upon current verifiable, objective, and granular cost data.

Learn more abour reliable construction cost data.  Relearn Construction Cost Estimating Relearn Construction Cost Estimating

Ready for advanced construction cost estimating and improve cost visibility and management capability?

Relearn Construction Cost Estimating Relearn Construction Cost Estimating

New cost data resources and significantly enhanced methods to improve estimating are now available.  the jobsite.

 

  • Shared dommon data environment
  • Quarterly updates
  • Local labor, material, and equipment costs
  • Productivity data

Relearn Construction Cost Estimating

AI - caveat emptor - FM

AI – caveat emptor – FM

AI -Caveat Emptor – FM

(Above image by rawpixel.com on Freepik)

 

While the below was intended to apply to computers, the content has relevance to AI.

That said, the current status of AI is basically “pattern recognition”, the problem of assuming biased or misinformation is accurate is very real. AI algorithims sort through avaiable data, look for relevant information based upon statistically high conformity and output a result.  The issue is with this approach is clear, rarely is the “consensus” of available data the answer when it comes to complex or innovative solutions.

 

six reasons construction projects fail, Why LEAN Construction Matters

Six Reasons Construction Project Fail

These are the top six reasons construction projects fail.

Six Reasons Construction Project Fail

Whether repair, renovation, maintenance, or new builds, 30%-40% waste is the norm due to one or more of the following…

#1 Lack owner leadership, capacity, accountability.
#2 Failure to adopt, implement, and manage a robust and integrated planning, procurement, and project delivery process.
#3 Poor team selection.
#4 Insufficiently detailed and/or poorly communicated Scope of Work (SOW).
#5 Lack of trust.
#6 Failure to leverage the knowledge of those doing the work.

Learn more about the six reasons construction projects fail

2024 JOC Program

2024 JOC Program

Is your 2024 JOC Program up to date?

FACT:  Most JOC Programs have not kept pace with current robust processes, cost data sets, or technologies.

 

Are you and your Job Order Contracting Team….

    • continually making improvements.
    • adopting a long-term perspective,
    • engaging in better internal and external communications,
    • allocating resources to the most attractive improvement activities,
    • collaboratively and efficiently engaging in planning, procurement, and project delivery activities,
    • encouraging correct organizational behaviors,
    • supporting core initiatives and managing change,
    • monitoring and identifying both successes and failures,
    • ensuring ALL participants and stakeholder understand their roles, activities, and objectives,
    • identifying where problems, bottlenecks and waste exists, and where improvements are necessary,
    • ensure that decisions are based on objective, quantifiable facts, and not supposition or simply “the old way of doing things”,
    • quantitating  if planned JOC outcomes happened.
    • identifying if the JOC Program is actually meeting  “customer” and organizational requirements?

2024 JOC Program

Goverment Agency FM Strategy

Goverment Agency FM Strategy

United States Government agency FM strategy and management has remained inefficient and without proper oversight for decades.

Lacking leadership, capacity, and accountability, they are still remain unable or unwilling to quantify and manage the returns on FM investment.  Other countries, such as the UK for example, are realizing that early engagement of the real property owner, the end user, and the planning, procurement, and project delivery teams are critical to improving overall repair, renovation, maintenance, and new construction outcomes.

The needs and scope associated with efficient management of built environment have been identified, and solutions have been available, for decades.  Nonetheless, government agencies continue fail to adopt  robust frameworks that integrate objective, current, and locally researched granular labor, material, and equipment costs with Integrated Project Delivery (IPD) and Job Order Contracting  (such at 4BT’s OpenJOC(TM) Framework, as efficient project delivery methods.   The latter providing greater increased scope of work (SOW) and cost transparency and detail, and overall enhanced communication on an early and ongoing basis.

 

United States Government agency FM strategy and management has remained ineffcient and without proper oversight for decades.

United States Government agency FM strategy and management has remained ineffcient and without proper oversight for decades.

 

Why LEAN Construction Matters

FM Perspectives – Public Sector #124

Public sector facilities management has not measurably improved for decades.

The reason is simple.  Lack of organizational development readiness.

Despite the availability of integrated, collaborative, and robust frameworks that enable Planning, Procurement, and Project Delivery teams to performs at signinficant higher levels with respect to cost visibility, cost management, quality, and speed, public sector FM suffers from an endemic lack of accountable, capable leadership.

Mired in barriers to improvement, largely reinforced by leaderships inability or lack of interest in change, the public sector FM remains highly wasteful from both environmental and economic perspectives.

Technology will NOT solve the problem.

The real question is what disruptive event(s) will force measureable improvement?

Enhance Construction Cost Estimating

Enhance Construction Cost Estimating – 5 Steps

While we are all aware of the high levels of financial and environmental waste associated with the construction and sustainment of the built environment, very little has been done to address the issue at the root cause level.   .

What are the sources of most project cost overruns, delays, and overall dissatisfaction with outcomes?

  • The failure to use standard terms, definitions, and data architectures as well as objective local market data.
  • Reliance upon traditional and flawed techniques of planning, procurement, and project delivery methods.
  • Archaic cost estimation methods such as the use of historical data, lump sum subcontractor quotes, and/or national average cost data and location factors, area cost factors, and/or economic factors.

Enhance Construction Cost Estimating

What’s needed to improve construction cost estimating?

  1. A detailed, well-communicated Scope of Work is critical to the success of any project whether repair, renovation, maintenance, or new construction and the associated use of commonly understood, standardized terms, definitions, and data architectures (expanded CSI Masterformat, UNIFORMAT…).
  2. Early and ongoing communication and collaboration among owners and design/builders during the planning, procurement, and project delivery phases based upon a robust integrated framework.
  3. Development of a shared detailed Scope of Work
  4. A detail quantity take off and associated objective current, locally researched line item construction cost database.
  5. Owner leadership, capacity, and accountability.

Enhance Construction Cost Estimating

Maximize available project budget via informed decisions made by shared, current, and objective information.

Reduce the number of surprises, disruptions, and change orders.

Join the converstation and make a difference!

Construction Estimating Cost Data
local construction cost dast
Objective, current, local market construction cost data
Why LEAN Construction Matters

Improving Job Order Contracting Outcomes

Improving Job Order Contracting outcomes requires transformational change.

We have yet to reach a point where JOC is valued for more than simply speeding procurement times.

To date, most public sector owners use JOC to shorten procurement timelines without sufficient consideration of cost, quality, relationship building, or risk mitigation.  The net effect is that many owners are wasting hundreds of thousands to millions of dollars paying for “JOC consulting” fees as a percentage of construction costs, and not engaging with design/builders in a manner that achieve maximum benefit for both parties.

Learn more about collaborative Job Order Contracting…

Why LEAN Construction Matters

The BETTER Job Order Contracting Solution

Looking for a better Job Order Contracting application?  The 4BT OpenJOCTM  Solution is just that!

Why is the 4BT OpenJOCTM  Solution better?  Simple, it allows you and your team to…

  • Leverage current best management practices with a focus upon collaboratoin and best value outcomes for all participants and stakeholders.
  • Engage and empower the project leadership team and  higher level of stakeholder involvement throughout a project.
  • Full owner/design-builder involvement without a “JOC Consultant” intermediary.
  • No “percentage fee” based upon construction volume.  (Why waste hundreds of thousands of dollars?)
  • Current, local market labor, material, and equipment costs, updated quarterly.  Over 80,000 line items.
  • Access to experienced senior professionals by phone and email for support and training.
  • Technology securely hosted on Microsoft Azure Government Cloud.

BETTER Job Order Contracting

BETTER Job Order Contracting

Construction Estimating Cost Data

 

Why LEAN Construction Matters

Looking for a BETTER Job Order Contracting Solution?

If you are looking for a better job order contracting solution, it’s time we talked.

 

  1. Bolster your team with a diverse range of perspectives and expertise can help ensure you’re sufficiently covering all you requirements.
  2. Transparently communicate your plans, SOWs, and requirements so that everyone has a firm grasp.
  3. Remember that repair, renovation, maintenance, and new builders can no longer be the purview of one person or a small group of individuals.
  4. Respond quickly to opportunities and problems and make timely decisions.
  5. Use objective, current, granular local market labor, material, and equipement cost information.
  6. Become independent of costly fee-based “JOC Consultants”.

Lower costs and improve performance today with the 4BT OpenJOC(TM) Solutions.

TM

Collaboration and informed decision-making

Collaboration and informed decision-making in the construction industry

Cost visibilty and transparency promotes a culture of collaboration and informed decision-making and can ensure greater efficiency across the facilities management and AECOO sectors.

 

Improving construction cost estimating requires collaboration, transparency, and a robust process. An essential aspect is sharing objective, local market, granular labor, material, and equipment costs. Relying solely on contractor or subcontractor costs, especially lump sums without collaborating on a detailed Scope of Work (SOW), will not lead to verifiable construction costs.

To efficiently share cost information, organize data in a standard architecture, such as expanded CSI MasterFormat, and use industry standard terms, definitions, and units of measure. Collaboration in the above manner allows disparate groups, including owners, A/E’s, builders, and procurement professionals, to focus on common goals.

Collaboration involves both giving and receiving help. It’s essential to remember that the process must include direct owner involvement. The excessive use of “consultants” will not enable an environment of true owner and design/builder collaboration that is mandatory for optimization of outcomes. Maintaining alignment among team members is challenging but essential.

4BT.us offers a useful resource for objective, verifiable, and current local market unit price books to help improve construction cost estimating. Check it out!

#costestimating #construction #estimating #verifiable #accurate #costdata #masterformat #csi #benchmark #standard

Collaboration and informed decision-making in the construction industry

Why LEAN Construction Matters

Introducing LEED v5 – For what it is worth.

Introducing LEED v5.  “LEED v5 is next version of the globally recognized comprehensive framework for green building practices. Embracing market demands for greater accountability, v5 will champion solutions to aligning the built environment with critical imperatives including decarbonization, ecosystem conservation and restoration, equity, health, and resilience. LEED v5 will drive real-world impact and positive change worldwide.”

 

Introducing LEED V5

Learn more…  https://www.usgbc.org/leed/v5

 

via 4BT.us

 

 

Lifecycle facilities management is so wasteful

Lifecycle facilities management is so wasteful. Why?

Lifecycle facilities management is so wasteful because we fail to do the hard work.

“We put off the hard work of reflecting on what we did wrong.” “Sometimes we’re reluctant to admit that we failed in the first place,” she continues. “We’re embarrassed by our failures and quick to spot those of others. We deny, gloss over, and quickly move on from – or blame circumstances and other people for – things that go wrong. Every child learns, sooner or later, to dodge blame by pointing the finger elsewhere. Over time, this becomes habitual.”  – Amy Edmondson

Change is very difficult for humans to accept, yet is sorely needed across the AECOO sector.

Lifecycle facilities management is so wasteful CONSTRUCTION COST MANAGEMENT
FM 2023

#construction #facilitiesmanagement #productivity #costmanagement #sustainability #relationships #collaboration

JOC Coefficients Less than 1.0

JOC Coefficients Less than 1.0

JOC Coefficients less than 1.0 are unfortunately common however represent sinficant risk to both real property owners and JOC contractors.

 

A Job Order Contract (JOC) coefficient refers to a multiplier that is used to adjust the prices in a JOC contract. The coefficient should typically not be less than 1.0.

Let’s break down what this means:

Job Order Contracts (JOC)

  • Definition: JOC is a type of procurement process used by public agencies to accomplish a large number of small to medium-sized projects with a single, competitively bid contract.
  • Coefficient: The coefficient in a JOC is a factor that adjusts the unit prices established in the contract.  It should be used to account for contractor overhead and profit.  It should NOT BE USED to account for fluctuations in material costs, labor rates, and other factors that can change during the contract term. ( A unit price book should represent the costs for construction tasks (material, labor, and equipment) without contractor overhead and profit.  This representation is referred to as “bare costs”.

Why Coefficient Should Not Be Less Than 1.0

  • Cost Adjustment: A coefficient less than 1.0 would mean that the unit prices in the contract would be decreased, which might lead to issues with covering costs.
  • Risk of Underestimation: If the coefficient is too low, it may not adequately cover unexpected increases in material prices, labor rates, or other project costs.
  • Contractor Viability: A coefficient less than 1.0 could put financial strain on the contractor, potentially affecting the quality and timeliness of project delivery.
  • Poor Estimating Practices: A coefficient less than 1.0 may cause a contractor to “pad” his estimates by introducing high quantities than required, needlessly creating non-prepriced line items, or otherwise impact pricing in an inappropriate manner.

Recommended Practices:

  • Standard Coefficient: It’s common for JOC contracts to have a starting coefficient of 1.0 or higher.   If a unit price price is appropriately and locally researched (not a national average cost book using location factors), objective, and current, the variance from 1.0 should simply include contractor overhead and profit.
  • Adjustment: Some contracts allow for adjustments to the coefficient over time, based on agreed-upon factors such as inflation rates or market conditions.  This practice is NOT RECOMMENDED.  It is recommend that the unit price cost data be reqularly updated, preferably quarterly, however, annually at a minimum.
  • Balancing Costs: The goal is to balance the contractor’s need to cover costs with the client’s need for cost-effectiveness, predictability, and cost visibility.

Conclusion:

A JOC coefficient less than 1.0 is generally not recommended because it can introduce financial risks for both the contractor and the client. The coefficient should be set at a level that allows the contractor to cover costs and maintain a reasonable profit margin while providing value to the client.

 

local construction cost dast
Objective, current, local market construction cost data

Species loss due to construction

Why Sustainable FM Matters

Here’s a simple reason why sustainable FM matters.

According to a 2015 study, almost 16% of terrestrial plant and vertebrate species are at risk of extinction in the long term due to construction  and land use, as well as  14% of terrestrial vertebrate species native habitat.

 

 

sustainable FM matters

Source: United Nations Environment Programme (2022). International Good Practice Principles for Sustainable Infrastructure. Nairobi

 

sustainable FM

Circular Economy and Sustainable FM

Circular Economy and Sustainable FM

There is a direct linkage between the concept of a circular economy and sustainable FM.

The principles of a circular economy are:

  1. design out waste and pollution;
  2. keep products and materials in use; and
  3. regenerate natural systems.

The applicability of these to sustainable FM is clear.

Improving the efficiency of facilities repair, renovation, maintenance, and new build projects is fundmental to attainment of both a circular economy and sustainable FM.

Circular Economy and Sustainable FM

 

Learn more…

Why LEAN Construction Matters

FedRAMP limits Construction Productivity and Innovation

While the concept of providing a standardized security approach may have been sound, FedRAMP limits Construction Productivity and Innovation,

FEDRAMP is Hindering Facilities Management in the Federal Sector due to its failure to keep pace with current technology and methods.

 

The Federal Risk and Authorization Management Program (FedRAMP) is a government-wide program that provides a standardized approach to security assessment, authorization, and continuous monitoring for cloud products and services. While FedRAMP aims to enhance the security of cloud services used by the federal government, it negatively impacts small businesses, the overall attempt to improve the AECOO sector’s low productivity, and innovation.

FEDRAMP is a clear create a barrier to entry for smaller businesses, reducing competition and innovation in the market.

Challenges for Small Businesses:

  1. Costs: Achieving FedRAMP compliance is cost prohibitive for most  small businesses.  The cost of hiring consultants, implementing necessary security measures, and undergoing the assessment process is beynond the means of most small companies providing next generation solutions.
  2. Complexity: The process of obtaining FedRAMP compliance is complex and time-consuming. Small businesses are at a distinct disadvantage with respect to navigating the requirements, leading to delays and increased costs.
  3. Resource Intensity: Compliance requires a significant investment of time and manpower. For smaller businesses with limited staff, dedicating resources to FedRAMP compliance diverts attention from other critical areas of operation and growth.
  4. Competitive Disadvantage: Large companies with more resources can more easily absorb the costs and navigate the complexities of FedRAMP compliance. This  is a clear create a barrier to entry for smaller businesses, reducing competition and innovation in the market.

Impacts on Innovation:

  1. Inhibiting Experimentation: The rigorous requirements of FedRAMP discourages small businesses from experimenting with new technologies and services for the federal sector.  The fear of investing in a solution that may not meet compliance standards stifles innovation.
  2. Slowed Development Cycles: Meeting FedRAMP standards slowse development and release cycles of new products and services. Small businesses end up spending more time ensuring compliance than focusing on innovation and improvement.
  3. Opportunity Cost: The time and resources spent on achieving FedRAMP compliance that could beused for research, development, and bringing new ideas to market hampers the growth and competitiveness of small businesses.

Mitigation Strategies:

  1. Simplification: Streamlining the FedRAMP process, especially for small businesses, would lower the barrier to entry. Creating tiers of compliance based on the scale and scope of the business might help.
  2. Resource Support: Providing resources such as grants, low-cost loans, or consulting services specifically aimed at helping small businesses achieve FedRAMP compliance would make it more accessible.
  3. Education and Guidance:  Many applications, especially those accessing publicly available information, do not require FedRAMP approval, yet many federal organization do not understand this concept, or worse yet use FedRAMP as an excuse to use favored vendors.   Better education about FedRAMP requirements and assistance in navigating the process can empower owners to use more efficient solutions and enable small businesses to tackle compliance more effectively.
  4. Innovation Incentives: Offering incentives or grants for innovative solutions that meet FedRAMP compliance would encourage small businesses to continue innovating despite the challenges.

In conclusion, while FedRAMP’s intention is to enhance security for government data, its impact on small businesses and innovation is a serious valid concern. Addressing these challenges through simplification, support, education, and incentives could help strike a balance between security requirements and fostering innovation among small businesses and reducing the traditional high levels of financial and environment waste associated with the federal government.

 

Public Procurement of Construction Services

Public Procurement of Construction Services

Public procurement of construction services could be improved through the adoption of currently available best management practices.

While most organizations are aware of the rampant economic and environmental waste associated with construction, associate repair, renovation, and maintenance projects, focus continues be upon largely upon simply “getting project done”.

While there may be restrictions with respect to competitive, fixed price contracts there is a significant opportunity to better integrate planning, procurement, and project delivery teams and develop collaborative, transparent, and cost saving practices.

How

Organizational integration and alignment of cultural, professional, management, and commercial interests is also required, both internally and with construction services providers.  Without out this, the vast majority of projects, approximately eighty percent or more (80%+) will continue to fail by being late, over budget, or viewed as not being satisfactorily completed by one or more parties.

  • Multiparty Agreement
  • Shared Financial Risk
    and Reward
  • Early Involvement of All
    Parties
  • Collaborative Decisionmaking
  • Liability Waivers
  • Fiscal Transparency
  • Integrated Design

Public Procurement of Construction Services Public Procurement of Construction Services

  1. Focus upon people, teams, and collaborative processes
  2. Leverage existing robust planning, procurement, and project delivery methods
  3. Engage all participants and stakeholders as early as possible in the overall process
  4. Use objective and granular local market construction task data for all projects.
  5. Ensure appropriate access to current information to all project participants and stakeholders
  6. Mandate introductory and ongoing training for all participants
  7. Owner leadership, capacity, and accountability

Primary Obstacles to Execution

  1. Lack of awareness/education
  2. Lack of real property owner leadership capacity, commitment, and accountability
  3. Internal resistance to change

The benefits of adopting improved construction services procurement practices

  • Continuity of preferences and objectives throughout the planning, design, procurement and construction lifecycle
  • 30%-40% cost savings
  • Mutually beneficial long-term relationships with service providers
  • Consistent delivery of on-time, on-budget projects
  • Higher levels of quality
  • Faster project delivery
  • Significant reduction in the number of change orders

 

via Four BT, LLC – www.4bt.us

References:

AIA (2007). “Integrated Project Delivery: A Guide.” The American Institute of Architects
(AIA), Washington, DC
AGC (2010). Integrated Project Delivery for Public and Private Owners.
Ballard, G. (2008). ‘The Lean Project Delivery System”, Lean Construction Journal, 2008
Cohen, J. (2010). Integrated Project Delivery: Case Studies, American Institute of Architects (AIA), Washington, DC
Construction Users Roundtable (CURT). (2004). “Collaboration, Integrated Information and the Project Lifecycle in Building Design, Construction and Operation.”
Construction Users Roundtable (CURT). (2007).“Construction Strategy: CURT’s Path toward LEAN Project Delivery.”
Ballard, G., Kim, Y., Azari, R., and Cho, S. (2011). “Starting from Scratch: A New Project Delivery Paradigm.”, Research Report 271, Construction Industry Institute, Austin, Tx.
Kent, D. and Becerik-Gerber B. (2010). “Understanding Construction Industry Experience and Attitudes toward Integrated Project Delivery.” Journal of Construction Engineering and Management
Kim, Y., and Dossick, C. (2011). “What Makes the Delivery of a Project Integrated? A Case Study of Children’s Hospital, Bellevue, WA.”, Lean Construction Journal
Lee, H.W., Anderson, S., Kim, Y., and Ballard, G. (2013). “Advancing the Impact of Education, Training, and Professional Experience on Integrated Project Delivery.”
Matthews, O., and Howell, G. A. (2005). “Integrated Project Delivery an Example of Relational Contracting.” Lean Construction Journal

Sustainable Facilities Management Practices

Sustainable Facilities Management Practices

Sustainable Facilities Management Practices involve a clear set of objectives, methods, and processes aimed at maximizing performance of the built environment with respect to economic and environmental resources in concert with meeting organizational mission needs.

Concurrent planning, design, construction, and operation throughout the lifecycle of a built structure across disparate multidiscipline teams operating in a transparent and collaborative manner, in concert with real property owner leadership, commitment, and accountability are core requirements.

Robust strategies and support tools have also been developed for the implementation of sustainable facilities management and are continuing to evolve.

The majority of repair, renovation, maintenance, and new construction projects fail to be delivered on time or within with a satisfactory standard, or on budget despite the adoption various new technologies and tools such as BIM, CMMS, IWMS, CAFM, ERP, LPS, 5S, 5Whys, Gemba, etc.    The reason rests in the absence of an effective philosophy and supporting framework to manage and leverage working relationships and information shared between owners, architects, engineers, builders, building users, and facilities management.   

Core elements of sustainable facilities management

  1. Owner  leadership capacity, commitment, and accountability
  2. Team unity, commitment, and focus based upon the establishment of clear, mutually beneficial goals
  3. Significant investment in intitial and ongoing training for all participants and stakeholders
  4. Common, shared information environment
  5. Objective, current, verifiable, and granular construction task data shared throughout the project lifecycle
  6. Programmatic framework consistently applied to all projects
  7. Quantitative performance indicators
  8. Regular third-party audits

Coordination between organizations and crews can only be accomplish via early and ongoing information sharing among all participants and stakeholders.
Cost reduction/increased productivity results from learning that occurs within a shared information environment and the associated reduction of  errors throughout the project duration and associated rework.

Primary failure points for repair, renovation, maintenance, or new construction projects include;

  • Poor owner leadership
  • Selection of wasteful project procurement and project delivery methods.
  • Lack of objective local market granular line item labor, material, and equipment costs information and/or failure to share information this and all relevant information with all project partcipants.

Sustainable Facilities Management PracticesSustainable Facilities Management Practices

 

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Linking Program Management and Project Management

Linking Program Management and Project Management – A Proven Construction Productivity Solution

Linking Program Management and Project Management  and enhancing  this relationship aligns single projects to a robust programmatic approach to significantsly improve overall outcomes for owners, architects, engineers, and builders.

Linking Program Management and Project Management

 

TRANSPARENCY-COLLABORATION-ROBUST PROCESS

Imagine that the the person who owns the facility and the one designing, engineering, repair, renovating, maintaing, or building it  had the same information.

Imagine a long term, mutually beneficial relationship among all parties that is aligned to the mutually beneficial interests of all parties.

 

Programs vs. Projects – Addressing Construction Productivity

What’s the difference between a project and a program?

A project is temporary, with a beginning and an end, while a program is a framework that supports projects.

In the construction industry, every repair, renovation, maintenance, or new build project may have its unique characteristics, but they should all observe the same fundamental programmatic approach in order to achieve maximum beneficial value for all participants and stakeholders.

Unfortunately, the root cause of low productivity and high levels of financial and environmental waste associated with the creation and sustainment of the built environment is the failure of owners, architects, engineers, and builders to adopt a robust programmatic framework. By adopting a programmatic approach, we can address these issues and ensure that every project is completed efficiently and sustainably.

Let’s work together to improve construction productivity and create a more sustainable built environment for all.

Linking Program Management and Project Management

CONSTRUCTION COST MANAGEMENT Linking Program Management and Project Management

Linking Program Management and Project Management
Managing all projects in a coordinated way ensures…
#1. Alignment of all participant and stakeholder goals.
#2. Full technical and cost visibility and transparency.
#3. 90%+ of all projects delivered on-time, on-budget, and per specification.

4bt.us – Current, local market granular cost data and integrated project delivery solutions.

 

Facilities Leaders NOT Facilities Managers

Facilities Leaders NOT Facilities Managers

Attaining a sustainable built environment requires Facilities Leaders NOT Facilities Managers.

#1. Managers focus upon goals; leaders grow their people and perfect their systems.
Repair, renovation, maintenance, and new build project fail due to poor systems and rarely due to the people doing the work.
Leaders leverage systems-thinking and are process-oriented. Focus is on the daily habits, routines, cultures, and actions that lead to success. They understand that people and robust systems dictate outcomes.
Managers tend to focus upon individual details without paying as much attention to the processes, systems, and strategies needed to consistently achieve optimal outcomes.

#2. Leaders focus upon importance, managers are reactionary.
Managers are stuck on on tasks that appear urgent but are not important.
Leaders expended resources that enable them to concentrate on tasks that are important and build towards long-term success.

Facilities Leaders NOT Facilities Managers
#3. Leaders see road maps to success, managers see paperwork.
Time, objective, current actionable information is critical to any project. Without it, production, flow, and knowing what will happen and when is impossible.
Managers complain about documentation, especially allocating the time and resources to develop a detailed, well communicated Scope of Work including local market granular material, equipment, and labor requirements. Leaders understand the need to quantify what planned and what is being built.

#4. Leaders set and enforce standards; managers work without them.
Leaders set clear methods and means for how things should be done and deploy processes to ensure everyone is on board.
Leaders are accountable are all internal and external supporting teams.

#5. Leaders listen and learn, manages enable the ‘status quo’.
Unhealthy relationships are due to difficult people, but rather misunderstanding of our differences, our inability to easily change.
Leaders make a serious effort to see things from someone else’s point of view. They respect their differences and adjust their approach accordingly.

#6. Managers focus on dates, while leaders focus all aspects of production.
Who does what by when, is irrelevant if the details of how things get done are not fully considered. Leaders fully appreciate how work happens, the “flow” of production activities, and implement the right systems to deal with variances.
Facilities Leaders NOT Facilities Managers Facilities Leaders NOT Facilities Managers
#7. Leaders plans carefully and execute quickly. Managers speed through the planning process.
Rushing through the planning phase is the fastest way to errors, cost overruns, and rework. Managers tend to minimize planning are forced to engage in inefficient reactive tasks.

#8. Leaders listen to and value those doing the work. Managers do the opposite.
Amateurs undervalue trade partners. While leaders know that the value of developing strong relationships with skilled trade partners, managers tend to abuse them. Leaders provide support, express appreciation, and learn from those actually doing the work.

#9. Managers focus upon command & control, while leaders gain trust and alignment through communication.
Building the vision of a shared, mutually beneficial outcome drives creativity, passion, and commitment. It is the compelling direction and vision that connects everyone’s work to a larger purpose.
Managers tend to focus on maximizing the performance of individual’s, resulting in unanticipated conflicts with mission goals and other team players.

#10. Leaders focus upon people, while managers focus upon skills.
While technical skills certainly matter, communication, problem-solving, collaborative leadership, and critical thinking cannot be overlooked.

via 4bt.us

ISO - FM & Data Management

ISO – FM & Data Management

“ISO 55000/1 are standards that define a management system for asset management. The focus of these standards is not the asset (in this case the data asset). Instead, its focus is on managing the value generated by and through the asset (to include data and data as an asset). This is an important nuance because it means the ISO 55000 standard series will not tell you how to manage data, it will only cover how data interfaces with asset management and thereby generates value for the organization.

ISO 55001 (2014) currently contains paragraphs that touch on the management of data in terms its support of asset management objectives – that is the management objectives for assets that are needed to achieve organizational objectives. They are: 7.5. – Information Requirements, and 7.6. – Documented Information. Furthermore, the word “data” is mentioned only twice in the body of the standard and not in context of requirements for its explicit management. I agree this is unsatisfactory and undervalues the importance of data as an asset and its role in asset management. Currently, ISO 55000/1 does not do a good job on how intangible (non-physical) assets are covered. Thankfully, this is not where this story ends.

The ISO Technical Committee (TC 251) that manages the ISO 55000 series is seeking to remedy this through updates and new standards planned to be released this year. These includes:

Update: ISO 55000 – Overview, Principles, and Terminology: introduces “data” as a technical term and integrates use of data in benefits of asset management.

Update: ISO 55001 – Asset Management System Requirements: Expands a subclause to cover Data and Information and adds another on Knowledge in clause 7. – Support. Also, it adds substantial new content on decision making and frameworks that will elevate recognition and prominence of data in support of asset management.

New: ISO 55012 – Guidance on People Involvement and Competence:  Introduces and details the human-side of asset management knowledge and application that, given ISO 55000/1 expanded scope, is inclusive of data/information/knowledge management and their roles supporting achievement of asset management.

New: ISO 55013 – Guidance on the Management of Data Assets: Provides a detailed overview on data’s role in asset management and the management of data as an asset. Primary clauses herein are titled: Managing Asset Data, Delivering Value from Asset Data, Identifying Data Assets, Managing Data Assets, and Governance. This includes about 12 pages of content that will develop and reinforce the role data has in asset management and supporting value generating activities.”

(Source:  Jack Dempsey – Linked In Feed 20240228)

Efficiently Manage Dynamic Projects

How to Efficiently Manage Dynamic Projects – The Solution to FM and Construction Waste

Learning how to effciently manage dynamic project is the first step toward solving FM and construction waste.

Focus must shift from constantly seeking technology as a solution to the root cause of the AECOO sector’s problem.  The root cause is a bad process, the solution is the application of systems thinking and the adoption of robust frameworks that focus upon People, then Process, then Information, and finally enabling Technology.

 

Image Source: Leyla Acaroglu (https://medium.com/disruptive-design/tools-for-systems-thinkers-the-6-fundamental-concepts-of-systems-thinking-379cdac3dc6a)
Image Source: Leyla Acaroglu (https://medium.com/disruptive-design/tools-for-systems-thinkers-the-6-fundamental-concepts-of-systems-thinking-379cdac3dc6a)

The lack of system thinking across the FM and construction sector is a primary cause of rampant economic and environmental waste. Until system thinking is understood and adopted on a widespread basis, there is little likelihood of measurable improvement.

What is system thinking? – Simple, it’s the process of considering the whole and how the all the associated parts, people, actions, resources interrelate, and discovering ways of improvement.

Why does it matter? – The application of system thinking to facilities management (FM) and the AECOO sector, and associated tools and support processes, can consistently ensure the delivery of quality, sustainable outcomes, on time and on budget. (AECOO = Architecture, Engineering, Construction, Owners, Operators)

What are the barriers? – System thinking requires a fundamental change in mindset for current AECOO players. While the following may sound like “common sense”, the philosophies and concepts are rarely practiced. Care of People. – Innovation and improvement require that traditional adversaries find common ground. We all know that traditional planning, procurement, and project delivery practices are adversarial, and broken, yet we fail to address this basic issue. Owners must lead a change in mindset and provide a consistently safe, welcoming, and collaborative environment. Everyone involved also must enable those doing the work, those with hands-on knowledge, to contribute to solutions in innovative ways.

Examples of FM and construction philosophies, concepts, and tools that leverage system thinking? Lifecycle total cost of ownership (TCO) asset management, Alliance Contracting, Integrated Project Delivery (IPD), and LEAN Job Order Contracting all embody system thinking. While the degree to which these and other practices maximize the benefits of system thinking varies widely based upon actual implementation, significant, measurable benefit can be realized if ALL the following criteria are met. Total cost savings of 30%-40%, on time, on budget quality delivery, and satisfaction of all involved participants and stakeholders are just a few of benefits.

  1. Real property owner leadership, accountability, and commitment
  2. Multi-party, long term agreement with an integral operation manual and/or execution guide that clearly communicates roles, responsibilities, deliverables, processes, workflows, quantitative performance metrics, and shared risks/rewards.
  3. Integrated internal and external planning, procurement, and project delivery teams that communicate and collaborate on an early and ongoing basis.
  4. A common data environment (CDE) inclusive of 1. A common written set of terms and definitions using industry standards without confusing acronyms or abbreviations, and 2. a granular, line time construction task listing that is both locally researched, current, and organized using a standard data architecture (examples: expanded CSI Masterformat, expanded Uniformat).
  5. Mandatory initial and ongoing training for all participants.
System Thinking for FM and Construction
The System Thinking Journey from Mindset to Tools & Processes

There are other elements involved and customizations per organization to be considered, however, these represent core fundamental requirements.

Reach out to learn more….

Everything is ready… are you?

 

FEDRAMP is Hindering Facilities Management

FEDRAMP is Hindering Facilities Management in the Federal Sector

We have all been dealing with FEDRAMP for years along with associated misinformation, ambiguity, and missteps.

 

FEDRAMP is Hindering Facilities Management in the Federal Sector due to its failure to keep pace with current technology and methods.

 

FEDRAMP is Hindering Facilities Management in the Federal Sector due to its failure to keep pace with current technology and methods.

 

As a result, there is a misunderstanding as to how and if these requirements provide benefit. The fact is that FEDRAMP can and has harmed efficient federal sector stewardship of the built environment.

We are happy to hop on a call to assist you from an informational standpoint.

The following factual information is provided to assist Federal Departments and Agencies in making, or revising, policy specifically with respect to effectively and securely using commercial SaaS solutions to improve the efficiency of facilities and physical infrastructure operations, repair, renovation, maintenance, and new build activities, sustainment, and sustainability.

#1FEDRAMP was initially establish to provide a standardized method for ensuring digital information security for federal government agencies. It was based upon NIST standards and other information available at the time. Since that time, it has failed to keep pace with evolving technologies and methods.

#2 There a total of 459 companies in the world who have achieved FedRAMP certification. As you can imagine, the Government contracts with a lot more than that for SaaS solutions (https://marketplace.fedramp.gov/products). When looking over those companies who are certified, most of them are very very large companies and companies who are “hosting focused” versus “application focused”. As a result the “application focused” solutions tend to be traditional, outdated, and relatively expensive and do not maximize potential value to a government using agency.

#3 It is now recognized that the FEDRAMP process, while well intended, has several major issues.  It is now understood that requiring FEDRAMP certification in not in the best interests of federal government agencies and departments for many, if not most applications. Please review the following which clearly support this fact.

Here is a draft memo from OMB regarding FEDRAMP revisions, that: https://www.cio.gov/assets/files/resources/FedRAMP-updated-draft-guidance-2023.pdf . This memo clearly notes that SaaS product like those provided by Four BT, LLC and hundreds of other innovative solutions per #3 below are NOT subject to FEDRAMP requirements. )

“Examples of excluded cloud-based services that do not host an information system operated by an agency or contractor of an agency or another organization on behalf of an agency include:

#1. Ancillary services whose compromise would pose a negligible risk to Federal information or information systems, such as systems that make external measurements or read information from other publicly available services.

#2. Publicly available social media or communications platforms governed under Federal agency social media policies, in which Federal employees or support contractors may or may not enter Federal information.

#3. Publicly available services that provide commercially available information.”

“FedRAMP acts as a barrier to entry to firms offering their cloud services to the government.

FEDRAMP has created barriers for businesses offering cloud services to the government and have slowed agencies’ access to technology that increases their operational efficiency and reduces costs.

These issues have created artificial barriers to businesses offering their services to the federal government, thereby slowing agencies’ access to cloud services that increase their ability to serve the public while cutting costs.

The wide-ranging benefits of cloud computing make it clear that it is in the interest of the government to remove any unnecessary barriers to its adoption.”

This above quotes clearly support the issues associated with FEDRAMP(source: of above – https://itif.org/ )

Because Federal agencies require the ability to use more commercial SaaS products and services to meet their enterprise and public-facing needs, the FedRAMP program must continue to change and evolve. (Source: (Federal Secure Cloud Advisory Committee (FSCAC) Feedback to the GSA Administrator on the 2023 Draft Office of Management and Budget(OMB) Memo, “Modernizing the Federal Risk Authorization Management Program (FedRAMP)”)

#54BT’s Job Order Contracting and cost estimating systems using locally researched current and objective granular repair, renovation, maintenance, and new build cost and construction cost data are hosted in a FedRAMP certified data center and therefore inherit the controls from them.

There are few if any additional requirements that should be requested.

ALL Federal Departments and Agencies MUST update their SaaS use policies and change from needlessly requiring FEDRAMP approval. Not doing so, negatively impacts the efficiency of these organizations, in contradiction to FAR regulations and their fiduciary responsibility to taxpayers. Furthermore, exclusively requiring FEDRAMP certification for all SaaS applications favors large businesses, again, a violation of existing statutes.

#6It important that commercial SaaS providers, and the associated infrastructure used to deploy SaaS products, meet appropriated compliance requirements for specified levels of security as developed by NIST.

For example, Four BT LLC products are fully compliant in this regard.

Four BT, LLC (4BT) SaaS products are hosted on Microsoft AZURE and Amazon AWS.  Our products are hosted on Microsoft AZURE, and Amazon AWS in the United States, both hosting infrastructures are FEDRAMP compliant.

As a result of Microsoft AZURE hosting for example, and its FEDRAMP compliance, 4BT SaaS software inherits compliance. In addition, Four BT, LLC is company is DFARS, NIST 800-171 and CMMC Level 2 compliant and operates using the Microsoft GCC High. [Note: Microsoft 365 Government Community Cloud High is a cloud platform developed by Microsoft for cleared personnel and organizations that support the Department of Defense (DoD).]