Job Order Contracting Life-cycle Facilities Value Management

Job Order Contracting Life-cycle Facilities Value Management and improving AECOO outcomes for all participants and stakeholders.

INTRODUCTION – The goal of Job Order Contracting Life-cycle Facilities Value Management activities is to maximize the value of physical structures and assure appropriate ownership of the project outcomes over the project’s life span.   Funding for maintaining built structures is rarely sufficient, thus existing budgets must be maximized.   Job Order Contracting Life-cycle Facilities Value Management enables the efficient use of available funds targeted  for executing renovation, repair, maintenance, and minor new construction projects.  While some attempt to differentiate between life-cycle and value management, in reality, they should be one in the same, thus the use of the term, Job Order Contracting Life-cycle Facilities Value Management.

Life-cycle analysis takes into account best value.  This includes first costs as well as ongoing operation, maintenance,and disposal/recycling.  A best value approach to facilities management considers all possible alternatives and focuses upon total cost of ownership in concert with the built structures relative support of the organizational mission.

Maximizing facilities functions and performance at the lowest possible total cost is the definition of best practice facilities management, and/or Job Order Contracting Life-cycle Facilities Value Management.   This includes reducing the risk of project/system failure, on-time and on-budget project delivery,  shortening projects delivery times,  lowering operational costs, as well as improving quality, reliability and safety.

ROLE OF CONSTRUCTION DELIVERY METHODS – Collaborative participation of all participants and stakeholders as early in the project phase as possible and on an ongoing basis,  i.e. from concept onward, is a core element of successful life-cycle / value management.

The degree of success achieved with respect to life-cycle / value management is largely determined by the construction delivery method used.   Traditional design-bid-built has been noteworthy in its failure to deliver efficiency and long-term mutually beneficial relationships.   Alternatively, the proven success of Job Order Contracting, JOC and integrated project delivery, IPD have demonstrated significant measurable improvements in construction and life-cycle outcomes for all participants and stakeholders.

For example, Job Order Contracting can deliver over 90% of projects on-time, on-budget, and to the satisfaction of all stakeholders. This is amazing within an AECOO industry where waste and low productivity is the norm.

Both collaborative construction delivery methods, JOC and IPD,  focus upon best value.   They are proactive and based upon  problem solving management and maximizing the functional value of a project by assuring teamwork from concept stage to operation stage of projects.  They also leverage the expertise multidisciplinary teams.    JOC and IPD make the real property owner’s  value system explicitly clear from the project’s conceptual stage and onward.   They are designed to obtain the best functional balance between cost, quality, reliability, safety and aesthetic as determined by owner specifications.   Owner leadership and competence is a fundamental requirement, as is the competency and collaborative nature of each team member.

IMPLEMENTATION – Implementation of IPD and JOC programs commonly take the form of arranging an intial workshop in which all participants, the client/real property owner, facilities management, AE’s, contractors, suppliers, manufacturers, specialists and other stakeholders involved take part and put forward suggestions for discussions.   This is distinct from a project kick-off meeting.  The process assures that everyone understands what a client will accept as the benchmark to measure the outcome of their investment, as well as everyone’s roles, responsibilities, capabilities, risks, and rewards.

JOC, IPD, and life-cycle / value management are defined as an organized and written set of procedures.  Example being Operations Manuals or Execution Manuals, which are part of the contractual documents.  Both are based upon LEAN management principles, as both JOC and IPD are LEAN collaborative construction delivery methods.   Both are and  organized and written set of specified procedures and processes that are introduced, purposely to enhance the function of a designs, services, facilities or systems at
the lowest possible total cost of effective ownership, in concert with the client’s value system for quality, reliability, durability, conformance, durability, aesthetic, time, and cost.

JOC, IPD and other LEAN collaborative construction delivery methods center around enabling  team  creativity, innovation, and continuous improvement.   Other key characteristics include the following:

• Mutual trust/resepect
• Leveraging diverse areas of expertise
• Common data environment (CSI Uniformat, MasterFormat, shared terms, definitions in plain English, etc.)
• Shared risk/reward
• Best value procurement
• Supporting technology (cloud-based, collaborative platforms)
• Financial transparency (locally researched, defensible shared unit price cost books from independent and objective sources)
• Focus upon outcomes
• Required ongoing training for all participants
• Continuous improvement
• Regular independent audits

LEAN Planning Outline