What is Job Order Contracting? What is IDIQ?

What is an IDIQ?

Indefinite delivery/indefinite quantity (IDIQ) contracts has been a useful tool in federal government acquisition for many years.

IDIQ contracts had historically been used only as single award contracts to procure services or supplies until the Federal Acquisition Streamlining Act (FASA) of 1994, noting the value of multiple award contracts.   Additionally the court system determined that IDIQ contracts were applicable to construction and architect-engineering services, provided the selection of contractors and placement of orders are consistent with the Federal Acquisition Regulation Part 36.

Multiple forms of both multiple and single award construction IDIQ contracts are available as well as software to enable rapid implementation and consistent deployment.  Examples of multiple awards are multiple award construction contracts (MACC) and multiple award task order contracts (MATOC). Single awards include job order contracts / job order contracting (JOC) and simplified acquisition of base engineer requirements (SABER). SABER is the US Air Force implementation of JOC.

Multiple awards result in individual job tasks for which all awardees compete and are negotiated and priced per the specific requirement. Single awards and multiple awards are typically priced using detailed line item cost estimating provided specific to the IDIQ.  Commercial, industry standard unit price books may be use, such as RSMeans Cost Books or  “custom” IDIQ price books.  Both may be referred to a Unit Price Book (UPB), or an IDIQ price book/guide.   It is important that both the Owner and the Contractor have unit line item cost estimating capability. It is generally regarded as “best practice” and may even be a regulatory requirement that the Owner does their own internal estimate (sometimes referred to as an Independent Government Estimate – IGE).  Some Owners for specific forms of IDIQ, such as JOC for example,  may elect to “outsource” or subcontract the JOC program to a third party for a fee (typically a percentage of the overall JOC program annually).  In this instance the third party acts as an “owner’s agent” and works with the Contractors directly, vs. Owner “hands-on”  participation. The latter is not recommend, nor consistent with “pure” JOC program implementation. It may however be the only option for Owners with limited technical estimating and/or project/program management capabilities.

Additionally, multiple awards are forms of design-build for complex projects, typically $750,000 to $5 million. Single awards involve minimum design for non-complex projects that typically range from $2,000 to $750,000. However multi-year JOC/SABER programs can easily exceed $300 million.  Many JOC/SABER and IDIQ contacts involve a base year and three or four year options. This means that the owner/contractor relationship is long term, with no need to re-solicit for five years, a potential benefit for all parties.

Construction IDIQ contracts provide a streamlined means to complete projects with benefits for both the government ‘/ public agency (DOD, non-DOD Federal Government, State/County/Local Government, Airports, Education, Healthcare, and the commercial business (Contractor/AE).

National Construction Contracts and Law Survey – UK – 2012

NBS National Construction Contracts and Law Survey 2012

by Adrian Malleson
Research and Analysis Manager, RIBA Enterprises (Source: http://www.thenbs.com/topics/ContractsLaw/articles/nbsNationalConstructionContractsLawSurvey2012.asp?utm_source=eNews-Weekly&utm_medium=email&utm_campaign=2012-07-09)

From March to April 2012,  NBS a survey about contracts and legal issues within the UK construction industry.  to understand, among other things:

  • The different contracts and procurement methods being used
  • At what point in the process contracts are signed
  • The number and kinds of disputes taking place
  • How frequently partnering or collaborative working are used in construction projects.

To help the survey get industry wide representation more than 20 industry bodies, including the RIBA, assisted by getting their members to take part. Over 1,000 responses from across the industry were received.  This cross industry participation has meant that, for the first time, the UK now has had a broad based, independent survey of these areas. The responses weren’t just from architects and other consultants: clients and contractors took part too and the report breaks down responses by each group.
The findings give a full and at times startling picture of the UK construction industry’s relationship with contract and law.

In some ways, the industry remains rather traditional.  Collaboration, team integration and partnering have, at best, only been partially realised.

When we look at the contracts the industry uses, we see that traditional forms of contract still dominate. Sixty per cent of respondents tell us that the JCT Contracts are the ones they use most often, and 72 per cent of people used JCT Contracts at least once in the last year. That said, the NEC Contracts, associated more with non-traditional, collaborative working and procurement, have a firm place in the industry. Sixteen per cent tell us they use them most often and 29 per cent have used them at least once in the last year. For standard forms of contract, JCT and NEC dominate; together they are used more than all other standard contract types combined.

That said, “bespoke” contracts are widely used too; almost one quarter of respondents had used them in at least one project in the last year. Twenty years ago, the Latham Report concluded: “Endlessly refining existing conditions of contract will not solve adversarial problems. Public and private sector clients should begin to phase out bespoke documents“. That “phasing out” is turning out to be a long process – but one we’ll be able to track with subsequent surveys.

The adoption of electronic working also shows the traditional ways of working still remain. While we continue to envisage an electronic future of BIM orientated, collaborative working, more than 40 per cent of consultants and clients are still not using electronic tendering at all. There’s work to be done.

The report also gives an understanding of the number of disputes: both the perceived trend in the number of disputes in the industry and the number of disputes actually gone into by respondents.

Ninety-two per cent of the respondents agreed that the number of disputes in the sectors had either increased or stayed at the same level, with the current state of the economy being most often described as the cause. This somewhat dark assessment is borne out by almost one quarter of those taking part in the survey having been involved in a dispute during 2011.

It’s significant that 49 per cent of contractors who completed the survey tell us that “poor specification” is a “most difficult or recurrent issue” leading to dispute.

Together, the issues people gave as the causes of dispute make clear the need for jointly owned, standardized information. A clear information model including tight specification and variance tracking can help prevent legal action later.

So, the overall picture that emerges is one of an industry that still makes use of traditional methods but which sees the place for more innovation.

In many of the comments people made when completing the survey we could see a real desire for construction to be a collaborative, team-based enterprise where extra value is generated through cooperation. We hope to be moving towards a more collaborative industry. This move towards collaboration goes hand in hand with the move towards shared, co-owned information as well as in the choices of contracts and working methods.

One of the most, if not the most, significant impediments to true team working and collaboration is legal dispute whether actual, threatened or envisaged. The survey uncovered these disputes are disruptive, expensive and not uncommon. That’s why from the outset, projects need standardized, shared information models that are easy to update, maintain and act upon. These need to clearly delineate where risk and responsibility lie. That’s not to say the solution is just a technical one, or one of keeping records, though doing these things well can only help. Any information model, any discharge of a contract, can only be as successful as the team that creates and uses it.

National Construction Contracts and Law Survey 2012

Hope you enjoy reading the full report.

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A Framework for Efficient Life-cycle Management of Facilities

Robust Construction Cost Estimating with Best Representation of RSMeans Cost Data – Contractors, Owners, AEs, JOC, IPD, SABER, IDIQ …

“We can’t solve problems by using the same kind of thinking we used when we created them.”  – Albert Einstein

Despite Einstein’s quote, most Owners, Contractors, and AEs are burdened by aging and outdated tools that now create more problems than they solve.   Spreadsheets are a primary example.  Sure, they are an important tool.  But remember, they were designed some thirty years ago to deal with the mundane tasks of pen an paper accounting and forecasting.   Today’s world of Architecture, Engineering, Construction, Owner, and Operations, ( AECCO ) demands the collaboration of dispersed disciplines and teams,  accelerated deadlines, and “doing more with less”.   Creating and sharing spreadsheets can’t keep pace with the speed of business, and the documented (see references below) spreadsheet issues of formula and data input errors are far too costly.

Powerful cost estimating software, integrated with visual estimating, contract management, project management, and document management is the new standard.   Owners, Contractors, and AEs can be significantly more productive and collaborative, working literally at any time, from any place.

Furthermore with an integration of an exclusively enhanced 400,000+ line item RSMeans database (or an IDIQ, or custom database), transparency and consistency are virtually assured.

Make the move to newer, more productive cost estimating and project management systems.

Note: Christofferson, Jay. “Estimating with Microsoft Excel”, Brigham Young University.Nickols, Robert Duane. “Construction Estimating Using Excel” Lexington Technical Institute, University of Kentucky.

Comparison of Cost Estimating Tools

JOC White Paper

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Estimating, Project Delivery Methods and Improved Construction Productivity

Accurate construction estimates are a fundamental component of any successful construction project.

The more accurate the scope of a construction project, the more accurate the estimate.

To achieve accuracy in both the scope and the estimate requires collaboration and communication among Owners, AE’s, and Contractors.  Thus, while many/most AEC professionals could likely provide an accurate estimate if provided an accurate, detailed scope of the project, the latter is rare.

The endemic lack of collaboration among Owners, AEs, and Contractors, as well as relatively low percentage of timely accurate construction project scopes are both due to the inconsistent application of robust project delivery methods.

Any significant improvement in construction cost estimating and associated procurement, project management, and actual job-site work must be based in the development and deployment of efficient project delivery methods, such as Integrated Project Delivery (IPD), IPD-lite, Job Order Contacting(JOC).

Accurate scoping requires a knowledge of the construction processes. Unit costs and standardized data architectures and lexicon play key roles in accurately communication project requirements, however, AE, site, and execution components all impact unit pricing.

Converting scope to quantities requires a solid understanding of construction techniques, working with numbers, drawing scales, waste factors, plan reading, conversion factors, labor/material/crew/equipment variables …. and quantity take-off (QTO) and unit, assembly, system, and square foot costs are all important aspects.  For example, professional estimators..whether Owners, Contractors, or Independent,  get their unit costs a wide range of sources… historical information, contractors, trades, business product manufactures, as well as published national average, and localized cost data.
While a  lump sum price is so much more than “just” the total of unit material, labor and equipment costs, unit costs and standardized cost data architecture do, however, help in mitigating “missed items” and in communicating and resusing cost data.

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Integrated Project Delivery / IPD, Job Order Contracting / JOC , Simplified Acquisition Base Engineering Requirements. / SABER.. Central to Achieiving Sustainability and High Performance Buildings

IPD, SABER and JOC for High Performance Buildings

1. Buildings account for almost 40 percent of primary energy use in the United States, 12 percent of total water use, and 60 percent of all non-industrial waste. Indoor environmental quality of buildings affects the health, safety, and productivity of the people who occupy them.

2. The U.S. federal government has the opportunity, and the responsibility, to significantly improve the performance of its buildings and to lead the way for other large organizations to do the same. The Federal government owns or leases 429,000 buildings worldwide, containing 3.34 billion square feet of space.

3. JOC and SABER programs can play a very important role retrofitting existing buildings to achieve higher performance levels, while IPD provides more efficient project delivery for major new construction.

IPD, JOC, and SABER are  efficient construction delivery methods capable of delivering significantly  higher productivity and greater transparency vs. traditional “design-bid-build”, or even “design-build”.  More projects can be accomplished on-time and on-budget with Job Order Contracting, Simplified Acquisition of Base Engineering Requirements, and IPD… it’s that simple.

Efficient project delivery is a requisite component to achieiving sustainability goals and BIM.

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Data Requirements to Achieve High Performance Buildings – 2011 – Congressional Testimony

Data Needs to Achieve High Performance Buildings

 

Representative Hearing, July 18, 2011

 

Testimony from Cathy Turner, New Buildings Institute

 

INTRODUCTION


New Buildings Institute (NBI) is a nonprofit organization working to improve the energy performance of commercial buildings. We work collaboratively with commercial building market players—governments, utilities, energy efficiency advocates and building professionals—to remove barriers to energy efficiency. Our activities include promoting advanced design practices, improved technologies, performance feedback mechanisms, and public policies and programs that improve energy efficiency.

 

NBI is a sponsor of this effort because of its critical importance to the core mission of our nonprofit organization.

To achieve deep energy savings, all parties – policymakers, program managers, designers, owners, tenants, and the real estate community –must all have access to data that shows the strategies that are working and areas needing improvement.

 

As part of our research, we have compiled a substantial internal database of high performance buildings. That dataset is used in our analyses of the actual performance levels achieved and in the development of tools to better interpret energy use data. We have also participated actively in the DASH (Database for Analyzing Sustainable and High Performance Buildings) efforts over the past several years, working with a broad community of interested parties to identify the contents and structure of a national data repository.

This testimony summarizes the highest priority data needs the we see for the objective of dramatic progress toward very low energy buildings. We also include some suggestions for the process and structure of developing a data repository, based on our internal experience and that of the DASH effort. Fuller descriptions can be found in our supporting document.

OBJECTIVES AND USES OF HIGH PERFORMANCE BUILDING DATA

We need timely feedback on the actual energy performance being achieved in today’s buildings. This is critical to tracking the energy use progress leading to net-zero energy buildings, defining our pathway and interim goals to move forward. In particular, we must:

1. Know the actual energy performance of buildings compliant with recent energy codes.

Initial baselines and subsequent calibration points of codes to energy performance are fundamental to effective energy code policies.  While policymakers have set specific performance targets, most notably achieving net‐zero energy use in buildings by 2030, there is no way to tell how much progress our building stock is making toward that goal. Current energy code practice is based on estimated energy use of a theoretical sample of buildings that meet all code requirements. This is  not the same as using actual, measured building energy use as a basis for determining progress toward energy policy goals in buildings.

2. Know the results that beyond-code programs are producing High performance buildings, from voluntary programs state stretch codes or LEED, should be providing guidance for tomorrows energy codes. However, anumber of recent studies have demonstrated that various components of new buildings do not perform as well as intended. Stated savings are often based on modeled building performance, which assumes that all systems, components, and operation work as designed. In reality, such perfection is rarely attained, much less maintained.

3. Provide the basis for benchmarking and interpreting energy use levels

a. Know building performance characteristics

A national repository of shared data should include important information on current building performance-related characteristics (relevant system types, ages, physical components, etc). That would enable extracting and communicating cross-cutting lessons from broad experience.

b. Separate whole building performance into the base building and occupant-driven components

For proper benchmarking, we must be able to split energy used by the tenants as a requirement of their basic business activity from energy used for conditioning and lighting the base building. Submetering plug loads and tenant energy use is important for tenant-specific feedback, which becomes essential as we move toward outcome-based codes and very low energy goals. At a minimum, tools for reasonably estimating that split are critical to benchmarking whole building energy, and a national data repository should contain the data needed to use such tools.

4. Enable the transition to a forward-looking rating scale with a fixed baseline.

This will support:

a. More meaningful tracking of performance levels over time. Many organizations and agencies have set aggressive performance improvement goals based on a year 2000 baseline. A national data collection strategy must support tracking progress toward policy goals on a consistent basis – not continuously changing the baseline by always looking at “% better than current code.”

b. Continued meaningful benchmarking, to identify progress as buildings move beyond the best 1% of all existing turn-of-the century building stock. In other words, we must be able to benchmark progress beyond a current Energy Star rating of 99.

GENERAL COMMENTS ON PROCESS AND ANTICIPATED DATA STRUCTURE

These comments are in the context of a usable national repository of data, to be fed by multiple information sources, maintained over time, and to be publicly accessible with appropriate protection of confidentiality.

5. Clear definitions of expected users and objectives will be essential as desired data is identified.

a. The intended use of information determines the amount and level of detail needed. Some objectives, such as accurately estimating the entire national energy use or the total savings achieved from a utility program, require rigorously sampled, statistically representative data.

However, other goals, such as the support for local jurisdictions with disclosure ordinances or the move to forward-looking benchmarking, can be even better served with a more easily collected set of good, credible examples.

6. Create a framework for efficient prioritization and staging.

b. Identify core data items needed for nearly all the desired uses, and provide consistent definitions to be used by all data contributors.

c. Create a framework that supports adding deeper sets of information for specific purposes as definition and data become available.

d.Create synergies with local and state disclosure ordinances.

The jurisdictions that have adopted disclosure ordinances represent a potentially great data resource. No individual jurisdiction is in a position to collect national data from other jurisdictions.

7. Use modern data technology to facilitate information gathering.

e. Anticipate ongoing updates, and possible multiple years of experience for a single building, as opposed to a periodic single survey

f. As one example, consider an approach that could simplify the challenge of recording data for recent construction and renovation.

i. Capture building information at the time of a building permit. Building data needed for calculating and benchmarking performance results should be readily available at this time: square footage, primary systems, and general occupancy characteristics.

ii. Establish a standardized protocol to accept data from utilities, and Set up automatic uploads of utility data to the confidential central repository for these buildings.

iii. Such an approach could be piloted in a single jurisdiction or utility program.

The best role of NIBS will emerge from the discussions begun today. Logical components could include defining and communicating the standards and definitions, hosting the repository, and spearheading the addition of information for targeted segments of the marketplace or types of information.

 

The above is just one more case evidencing then need for a BIM Framework:

BIM

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BIM – Technology – LEAN Construction – Process

There are those that believe that the desire to utilize BIM is outpacing technology.

This belief is ill-founded.

The REAL issue is that many Owners, Contractors, AE’s, BPMs (business product manufactures), and oversight groups are being outpaced due to their lack of understanding of “basic” BIM PROCESSES.

BIM is NOT 3-D rendering or collision detection.  Tools like Revit, ArchiCAD, Bentely, et al, are only components of a total BIM solution.

BIM is a PROCESS, combined and integrated with supporting TECHNOLOGY(IES) to enable life-cycle management of the built environment.

Cloud technology will support web-centric collaboration and associated secure/rapid data exchange, as well as associated taxonomies, data architectures, etc. such as COBIE, IFC, OMNICLASS (and associated UNIFORMAT, MASTERFORMAT, etc.), STEP…

The integration of the following TECHNOLOGIES, PROCESSES, and COMPETENCIES via CLOUD enablement will expedite BIM:

Efficient Construction Delivery Methods and Software: ( IPD – Integrated Project Delivery, JOC – Job Order Contracting, JOC is IPD specifically for repair, renovation, sustainability and new construction; whereas IPD is for major new construction).

Capital Planning and Management Systems-CPMS: Facility condition assessment, multi-year capital planning scenario analysis.

Space Planning – CAFM: Utilization, hoteling.

Computerized Maintenance Management Systems – CMMS:  Routine/preventitive maintenance of “moveable” equipment (typically under $5,000-$10,000, vs. capital issues.

Building Automation Systems – BAS: Automated HVAC, Security, Energy monitoring and control systems.

Geographic Information Systems – GIS:  Physical location systems.

A single “BIM” system will not support the above, and likely will not for a long time.
(Those that have implemented “ERP” systems, are honest with themselves, know the folly of assuming that implementing a single technology will improve and/or manage disparate processes.)

Technology is not the limiting factor relative to BIM,  however, a thorough understanding of the basic concepts, components, and processes associated with BIM, and gaining the appropriate level of competency within each domain, is certainly a challenge.

Equally daunting is gaining the associated requisite support of upper management within the Owner, Contractor, AE and other communities.

BIM – Energy Efficiency Tied to Real Estate / Real Property Sales – The Importance of High Performance Buildings vs. ROI

Due diligence relative to the energy efficiency of commercial is not only important relative to building resale and ROI, but is becoming mandated in several states, counties, and cities.   For example, use of the new ASTM (American Society for Testing and Materials) Standard E-2797-11, Standard Practice for Building Energy Performance Assessment for a Building Involved in a Real Estate Transaction, is required in several states and cities and under consideration in a growing number of others. Federal legislation is sure to follow.

Energy-efficient buildings cost less to operate, have higher net operating income (NOI), better asset value, and are more attractive to tenants.   Property owners and lessors can leverage higher performing buildings to attract and retain tenants that recognize that these buildings  have lower utility and operating costs.  In many cases leanders are provided a Pro Forma with a specific aline item for utilities/energy costs as a component of building operating costs.  Savvy buyers will also consider energy usage when comparing similar properties.

The Role of BIM, JOC, and IPD in Sustainability

Creating a baseline energy audit isalso  a “best practice” relative to enabling better short and longer term planning for facility renovation, repair, and maintenance projects.

It is likely that more and more facility condition assessments (FCAs) will include energy audits are a required, standardized component.

 In summary, standards and best practices relative to energy and condition audits are an important component of BIM ( Building Information Modeling ).  Robust practices for collection, assembly, evaluation, and reporting required information are key to BIM as are efficient renovation and repair contstruction methods such as JOC – Job Order Contracting, and IPD – Integrated Project Delivery.

Consistency and transparency in data collection, project evaluation, costing, and project managemetn are requirements in order to efficiently deliver quality  improvement project on time and on budget. 

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Construction Cost Estimating – Art or Science?

Both?

Standardized, repeatable methods, reference cost databases with common data structures, and robust software technology enable information sharing and reuse. All are key components of the construction cost estimating process for facility portfolio owners, contractors, subcontractors, and AE’s.

Construction Cost Estimating - Process Overview

That said, experience is equally important to enable localization and customization of costs due to when and where construction is taking place, and/or particular functional needs.

The role of software integrated with the construction delivery process, is equally important.  For example, JOC / SABER cost estimating and project management software leverages and shares the estimating team’s experience with everyone working on a planned or current project, as well as preserves valuable information for future reuse.

Software also helps to assure consistency, transparency, and quality.  Cost estimating software that includes project/program management, document management, and visual estimating is even more efficient as it assists estimators, procurement, designers, engineers, contractors, subcontractors, and owners from concept thru design, procurement, construction, and warranty!

(learn more at http://www.4clicks.com)

4D, 5D BIM can learn a lot from JOC – Job Order Contracting

The destiny of BIM is life-cycle facility management.  When this will happen is anyone’s guess.

In the interim, BIMers and FMers can learn a lot from JOC – Job Order Contracting.  JOC is arguably the best construction project delivery method for facility renovation, repair, and sustainability.

It is efficient (projects take far less time to scope, bid, and start), performance-based (contractors that deliver quality on time and on budge are rewarded with additional work), collaborative (long term, open relationships are the norm), and transparent (reference cost databases and/or custom cost guides are used along with associated standardized templates, reporting methods, etc.)

JOC shares the benefits of IPD (integrated project delivery) however, has a proven 25 years track record of success.

In a time when the economy and global warming force a new focus upon existing buildings and efficiency…. JOC can delivery today.

For these reasons that JOC adoption is rapidly accelerating in government, institution, and private sectors. .. and why BIM can learn from JOC.

4Clicks.JOC.BluePaper June 2010

Creating a Job Order Contract RFPJOC Trust Partnering Relationships

Thinking Outside the Box

Job Order Contracting and LEED

Creating a Job Order Contract RFP