Pros & Cons – Learn About Job Order Contracting

Job Order Contracting is a collaborative LEAN construction delivery method that can enable Owners to execute a higher percentage of quality facility renovation repair and renovation projects on-time and on-budget, IF implemented and management properly.

This video is important for anyone with a current Job Order Contract, or planning to participant in a JOC as an Owner, Contractor, Subcontractor, or Consultant.

 

Comprehensive Facility Maintenance Plan

Comprehensive Facility Maintenance Plan / CFMP

job order contracting

The cornerstone of any CFMP should be preventive maintenance.  A regularly-scheduled preventive maintenance,  mitigates the frequency of unplanned failures, extends the longevity of building systems beyond industry standards, and best suits organization needs for a safe and functional physical environment.

Commons CFMP objectives include:

  1. Maintenance of the physical environment in support of the organization’s  mission
  2. Extending the lifespan of building systems
  3. Maintaining the asset value of the property
  4. Mitigating catastrophic building system failures, fires, accidents, and other safety hazards.
  5. Providing buildings that function at requisite efficiency
  6. Providing continuous use of facilities without disruptions
  7. Energy conservation
  8. Regulatory compliance

Staffing,  delivery methodology,  standardized and timely information, and supporting technology are core aspects in the execution of;

  1. Scheduled Maintenance – Description of activities that can be forecast and for which expenditures of parts and labor are based on a predictable time table or use schedule. Main components include: Preventive Maintenance, Modifications and Alterations, and Scheduled Replacement.
  2. Unscheduled Maintenance – Description of activities that cannot be programmed or forecast, including emergency repairs and corrections of breakdowns.
  3. Deferred Maintenance – Description of scheduled activities, delayed or postponed for reasons such as lack of funds or personnel, changes in priorities and change of use.

Staffing

Operations and maintenance departments, based upon size, may have multiple departments, each with an area of specialization, or a single department.  Examples of specialized areas include: 1. Environmental, Health, and Safety, 2. Central Maintenance Shops, 3. Cluster Maintenance Program, 4. Custodial Services, and 5. Energy and Recycling.

Tasks

Ongoing tasks associated with operations and maintenance departments vary widely, and may include:

  • Preventive maintenance program execution for all facilities
  • Work order service requests management
  • Regular inspections of equipment and building systems, such as roofs, boilers, chillers, sprinkler systems, fire alarms, elevators, fire extinguishers…
  • Repair services
  • Maintain regulatory compliance for select building systems (e.g., elevators, fire suppression systems, pressure vessels)
  • Computerized maintenance management system software operation.
  • Administration of renovation, repair, and maintenance contracts
  • General –  grounds maintenance program, custodial, etc.
  • Utility-billing data collection and analysis (including electric, natural gas, heating oil, propone, water/sewer, solid waste, and recycling).
  • Procurement of energy and solid waste services.
  • Manage contracts associated with energy and solid waste services.
  • Monitor the energy market to direct procurement decisions.
  • Coordinate with State and local officials on issues associated with energy, water/sewer utilities, and solid waste management.
  • Development and oversee energy reduction programs
  • Manage resource reduction and recycling program
  • Direct capital improvement projects related to lighting retrofits and solar power
  • Provide energy audits

Key Performance Indicators

The typical key performance indicators may include the following:

  • Top ten work order trouble codes
  • Quantity of temperature complaints (“too hot”, “too cold”)
  • Workforce productivity and utilization
  • Preventive maintenance versus corrective (or “reactive”) maintenance
  • Preventive maintenance schedule completion rate
  • Percent of major building systems operating within industry standard lifespan
  • System life-cycle performance
  • Deferred maintenance backlog reduction

Execution

Best value procurement, LEAN collaborative construction delivery methods such as Job Order Contracting, standard terms, definitions, as well as standardized cost and data architectures, and a documented Operations & Maintenance Execution Guide all contribute to maximizing return-on-investment and improving outcomes.

System Life-spans

  • Boilers (Steel, fire-tube) 25 years
  • Boilers (Cast iron) 35 years
  • Chillers (Air-cooled, reciprocating compressor) 20 years
  • Chillers (Water-cooled, screw compressor) 25 years
  • Chillers (Water-cooled, centrifugal compressor) 28 years •
  • HVAC (Rooftop units) 20 years
  • HVAC (Room unit ventilators) 25 years
  • HVAC (Penthouse/Interior mounted air handlers) 40 years
  • Flooring (Carpet) 15 years
  • Roofs (Asphalt Built-Up Roof, sloped) 25 years
  • Roofs (Metal) 30 years
  • Paving 25 years

City of Long Beach Job Order Contract Audit

City Auditor shares findings of an audit which found that
” that found LB’s (City of Long Beach) Public Works Department had let some contractors receive roughly $1.9 million more than they should have under the Job Order Contracting program. The actions involved projects costing an average of $100,000 each, meaning LB taxpayers didn’t receive as many as 19 infrastructure projects that they might have. ”  (Source: LBReport.com)

“In April (entering the campaign cycle for the sales tax increase portrayed as for infrastructure), Mayor Garcia agendized an item seeking changes in the Public Works Dept. program without disclosing Audit findings of which the Auditor had made him aware. On May 24, the Council approved City Attorney office-drafted changes to the Job Order Contracting program without disclosing the Audit-based underlying reasons for them. On May 25 (after vote by mail ballots had been circulating since roughly May 9), the Auditor’s office released its findings. The Auditor’s office has told LBREPORT.com that its timeline for releasing its Audit findings was coincidental.” – LBReport.com

Learn more

Proper oversight, education, and training are required for developing and implementing a Job Order Contract.

Improving Construction Productivity = Collaboration & Alternative Project Delivery

 

Eight Steps Toward Improving Construction Productivity

Partnering and collaboration must be a key performance metric by which real property owners and facility management professionals are measured.  Until this occurs, there is little hope for construction sector productivity improvement.

 

  1. Owners Foster and Mandate Collaborative Construction
  2. Best Value versus Lowest Bidder Procurement
  3.  Full Financial Transparency
  4.  Shared Risk / Reward
  5.  Mutual Goals & Trust
  6.  Common Terms, Definitions, and Data Architectures
  7.  Continuous Education, Improvement and Monitoring
  8. Adoption of LEAN Alternative Construction Delivery Methods – Job Order Contracting, JOC & Integrated Project Delivery (IPD)

JOB ORDER CONTRACTING

BIM has stagnated, and the construction industry (Architecture, Engineering, Construction, Operations, and Real Property Owners) as a whole remains unproductive due lack of focus upon process change management.

While most of us are aware that early and ongoing communication among all renovation, repair, or new construction stakeholders is the path to success, its rare that a team is established that is both clear on objectives and working towards common objectives.

Successful outcomes should be the objectives of ALL participants and partnering must not only be encouraged but mandated by real property owners.

Partnering is can not be accomplished solely through the implementation of technology. Nor is excessive management and control the path to success.  Adopting and fostering of LEAN best management practices, specifically developed for construction and which focus upon outcomes, is the path to productivity improvement.

Job order contracting and integrated project delivery are two examples of LEAN construction delivery methods that share decades of successful implementation and enable higher quality and a higher percentage of projects to be completed on-time and on-budget.

The most important element to successful project delivery is an educated and capable Owner.  An Owner that understands collaborative construction delivery and is focused upon successful outcomes for ALL project participants and stakeholders.

Technology will do little to solving the construction industry’s productivity issues. Despite the marketing of software vendors, technology is simply an enabler for faster and lower cost consistent deployment.  The key to success is the best management practices and processes embedded within technology.

Real property owners required training and ongoing professional development.  This includes real property executives, facility management, technical/engineering teams, cost estimators, purchasing/procurement, and facility users.   Educational institutions must also alter their programs.   Examples of competencies and content include; life-cycle management of the built environment, total cost of ownership practices, LEAN best management practices, and collaborative and/or alternative construction delivery methods.

Mandatory Partnering

While mandatory partnering may seem contradictory, it is not.   All construction contracts, projects, and programs should include a operational manual.  The manual describes the roles, responsibilities, deliverables, and outcomes for all parties.  While each manual can, and should be tailored to each owner’s requirements, common components of the core framework are ever present.  The operations manual spells out all requirements, terms, etc., associated with the collaborative construction delivery process.  An example of a job order contracting process is shown below.

job order contracting

OpenJOCcycle

Common elements to any LEAN Collaborative Construction Delivery Method

Common elements to implementing a productive LEAN construction delivery methods include the following:

 

Owner Leadership of Team Collaboration

Best Value Procurement

Mutually Beneficial Goals and Outcomes

Performance-based Reward System

Shared Risk/Reward

Common Terms, Definitions, and Data Archtectures

Outcome-based Key Performance Metrics – KPIs

Continuous Monitoring, Improvement, and Education/Training

Global Oversight with Local Implementation

 

” Great care is taken to establish an IPD team where participants can work together as a collaborative unit. Team formation considers capability, team dynamics, compatibility, communication, trust building and commitment to an integrated process….Once a team is formed, it’s important to create a team atmosphere where collaboration and open communication can flourish.” – AIA

 

One of the most important life lesson that I have learned is that success or failure is generally not determined by a problem, issue, or even an opportunity, but rather by how we react and deal with the situation.   Whether it’s a construction project, or other situation,  if we react and act as a team versus as individuals, outcomes are ultimately improved.

“The goal of everyone in the industry should be better, faster, more capable project delivery created by fully integrated, collaborative teams. Owners must be the ones to drive this change, by leading the creation or collaborative, cross-functional teams comprised of design, construction, and facility management professionals.” – CURT

Job Order Contracting – Education, Training, Best Practices

Job Order Contracting – Education, Training, Best Practices

Strategy – Foundations – Collaboration – Standards – People – Process – Technology – Enabling Tools – Resources

 

Job order contracting provides distinct advantages to traditional design-bid-build, design-build, or CM@R.

Job order contracting is a LEAN collaborative construction delivery method that enable numerous renovation, repair, and construction projects to be completed on-time and on-budget, as well as to the satisfaction of all participants.

Job order contracting is NOT for everyone as it requires a shift is Culture and Behavior as well as a minimum set of capabilities on the part of the Owner, Contractor, and other stakeholders.   In point of fact, many/most Owners are not capable of deploying Job Order Contracting as they require additional education in the areas of LEAN, total-cost-of-ownership, and life-cycle management of the  built environment.   Similarly many contractors may not have the necessary skills and/or mindsets of transparency, collaboration, and shared/common goals.

job order contracting

A best practice job order contacting framework incorporates a JOC contract and an associated job order contracting operations manual.   Roles, responsibilities, and deliverables are clearly defined.   A unit price book, UPB is used by Owners and Contractors to provide line item detail and cost estimates for all construction projects / task orders.

A best practice Job Order Contract is also one that is Owner developed, deployed, and managed.  While outsourcing a Job Order Contracting Program to a third party may provide a way to become familiar with job order contracting, both it and the use of Cooperatives do not provide the full capabilities and benefits associated with Job Order Contracting.

Learn more about Job Order Contracting best management practices…

 

 

 

 

BIM & Efficient Life-cycle Management of Facilities & Infrastructure

bim and efficient life-cycle facility management

Efficient life-cycle management of facilities and other physical infrastructure is impossible until real property owners are better educated and truly capable in their role as stewards of the built environment.

LEAN best management practices and associated collaborative construction delivery methods (Integrated project delivery – IPD, Job Order Contracting – JOC, etc.) are REQUIRED in order to deliver quality renovation, repair, sustainability, and new construction projects on-time and on-budget.

Most Owners do not have the educational background or professional experience needed to consistently deploy LEAN construction delivery methods and/or life-cycle management.

job order contracting

job order contacting - JOC

Job Order Contracting – JOC, Training, & Motivation

Job Order Contracting – JOC – delivers greater numbers of quality projects, on-time and on-budget projects, as well as higher overall satisfaction levels than  “traditional” construction delivery methods such as design bid build, design build, CM@R, etc.   For this reason, the top 5% of Owners and Contractors depend upon JOC for horizontal and vertical renovation, repair, and minor new construction.

However, not all Owners and Contractors are ready for job order contracting. JOC requires higher levels of transparency, collaboration, motivation, and training than less productive traditional construction delivery methods.  It also requires shared/risk reward and common terms, definitions, and data architectures.  Many of these characteristics are foreign to Owners and Contractors sole experienced with arcahic and unproductive processes and outcomes associated  with low-bid procurement and dependent upon excessive change orders to complete construction projects.

Leadership and training versus excessive management and control are common with job order contracting.   In fact, on going training and continuous improvement are requirements for all LEAN construction delivery methods (job order contracting – JOC, integrated project delivery-IPD, etc.)

Studies have demonstrated that ongoing training and the selection of the construction delivery method are directly linked to motivation, as well as overall outcomes.  For example the below chart clearly demonstrates that more frequent training leads to higher levels of motivation (2016, Moriarty, T.)

job order contracting

Similarly the benefits of Job Order Contracting are are shown below.   Again, however, these benefits can only be recognized through the implement of LEAN best management practices and continuous support, monitoring, and ongoing training.
JOC - DB - DBB
(2015, Job Order Contracting – Performance Study – ASU / PBRSG)

 

LEAN – Job Order Contracting WebCast – Society of Military Engineers Facility Asset Management Committee

“LEAN – Job Order Contracting WebCast” – Society of Military Engineers Facility Asset Management Committee

On April 14th, The Society of Military Engineers (SAME) Facility Asset Management Committee hosted a WebCast presented by the Center for Job Order Contracting Excellence – CJE.

The WebCast titled, Efficient Renovation, Repair, and Minor New Construction LEAN – Job  Order Contracting, Best Management Practices,  was well attended and well received by attendees.

Presenters included:

Peter Cholakis, CJE Board Member

Charlie Bowers, LEED AP – CJE Board Member, Center for Job Order Contracting Excellence

 Jacob Kashiwagi, PhD, – Program Manager/Lecturer, Performance Based Studies Research Group, School of Sustainable Engineering and the   Built Environment, Ira A. Fulton Schools of Engineering, Arizona State University

WebCast Outline:

  • Definition of JOC (Termed SABER / Air Force)
  • JOC Best Management Practice Areas
  • Defining Characteristics of a JOC Program
  • Experience, Capability, and Technology Requirements
  • Roles – Owners, Contractors, Subcontractors, Oversight Groups, COOPs, Service Providers
  • Performance Metrics
  • Lessons Learned
  • ASU 2015 National JOC Research Study

“Owner implemented and managed Job Order Contracts are, by far, the fastest growing.” – Charlie Bowers, CJE Board Member

“We need to make more Owners aware of JOC, as it clearly provides major benefits such as the highest rate of on-time, on-budget, projects, as well as higher quality and greater overall satisfaction” – WebCast Attendee

“Only a fraction of Owners are aware of JOC” –  WebCast Attendee

“Five percent (5%) or less of real property owners are aware of JOC and practice Job Order Contracting using “best management practices” – Peter Cholakis, CJE Board Member

“The biggest obstacle to efficient construction delivery is Owners not hiring experts, not using BEST VALUE procurement, and not allowing competent experts to exercise their expertise” – Jacob Kashiwagi  –  Performance Based Studies Research Group -p PRBSRG,  Arizona State University

20160414-SAME Facility Asset Management WebCast

20160414-SAME Facility Asset Management WebCast

 

Collaboration Matrix

job order contractingjoc CERTIFIED