Tenant / Building User Relationship Management

Tenant / Building User Relationship Management – FM Metric #1?

How well facility managers support their tenants and/or building uses with respect to their respective organizational missions is a critical performance metric for any real property owner.

Responsiveness, Quality, and Budgetary/Financial Performance represent key areas in which facility management professionals are judged.

The ability of real property owners, in their role as facility managers/stewards  to collaborate with and understand the needs of building users as well as services providers such as architects, engineers, and construction contractors  determines their effectiveness with respect to improved service delivery, mitigating risk, and overall life-cycle management of built structures.

The ability of an owner/facility manager to efficiently manage their numerous renovation, repair, and maintenance projects encountered on a daily basis, as well as strategically deal with capital renewal and deferred maintenance determines ultimate short and longer term success or failure.

Collaboration, transparency, mutual trust & respects, and shared goals are critical to the achievement of superior facility management outcomes.   Understanding user/tenant requirements is step one, and sharing this information with all project participants from concept through ongoing life-cycle management is necessary in order to improve overall satisfaction as well as return on financial investment.

Use of LEAN collaborative construction delivery is the single most important element in improving overall outcomes.  Whether adopting Job Order Contracting – JOC, for renovation, repair, and maintenance, or Integrated Project Delivery – IPD, for major new construction, the results of proper adoption and implementation with be a high number of quality projects delivered on-time and on-budget, to the satisfaction of all involved parties.

Most Owner (approximately 73%) either lack confidence, or are only somewhat confident of the satisfaction levels of their tenants/building users.  When combined with the fact that the construction sector as a whole remains highly unproductive versus virtually every other industry, the need for cultural and operational change is clear.

Isn’t it time to move beyond ad-hoc business procedures and workflows, lack of standardized information, and limited financial transparency?

LEAN FM and Construction practices deliver…

A focus upon outcomes…

Early and ongoing collaboration…

Financial transparency…

Mutual respect & trust…

Common goal & objectives…

Shared risk/reward…

More projects on-time & on-budget…

Higher quality…

Significant productivity gains…

Standardized data for information-based decision support…

IFC, Cobie & Why the Autodesk / Trimble Interoperability Agreement Won’t Matter

IFC, Cobie, Masterformat, Uniformat, Omniclass are standard data architectures critical to efficient construction delivery.

That said, common terms, definitions , and data architectures are just one of several components of collaborative LEAN construction delivery.   Integrated Project Delivery, IPD and Job Order Contracting, JOC are proven collaborative construction delivery methods that deliver more projects on-time, on-budget, and to the satisfaction of all parties.

Until Owners require collaborative construction delivery and are capable of leading the shift toward built environment life-cycle management, all the technology in world will not make a difference.

The reason that BIM has stagnated in the U.S. and the U.K. is obvious….  culture change has yet to occur.

bim, building information management for FM

strategic facility management and BIM

Strategic Facility Management Execution Plan

Asset Lifecycle Model
for
Facility / Infrastructure Total Cost of Ownership Management
Framework, Glossary & Definitions

  1. Life-cycle versus first-cost perspective
  2. Value-based procurement
  3. Outcome-focused LEAN management
  4. Collaborative construction delivery – Job Order Contracting, JOC and Integrated Project Delivery
  5. Common terms, definitions, and standardized data architectures
  6. Preventative versus reactive maintenance
  7. Data-driven decision support
  8. Key performance indicators – KPIs

job order contract

The consistent use outcome-focused and best value based LEAN collaborative business practices deliver robust, scalable and repeatable processes to drive efficient life-cycle management of the  built environment and associated renovation, repair, maintenance, sustainability, and new construction.

Collaboration, transparency, mutual respect, and common terminology enable effective communication among the various decision makers, building managers, operators and technicians involved with facilities and physical infrastructure investment and management.

Activities that occur over the lifetime of a physical asset – programming, design, construction, operations, maintenance, repairs and utilization – and there are requisite core skills or COMPETENCIES to perform these activities.  Owner must become better educated in order to perform in their role as stewards of the built environment.

These competencies are  aligned with multiple specialized asset management business processes and practices.  The level of collaborative leverage of Competencies and Asset Management Business Processes and Practices determines of effectively an asset’s life-cycle will be managed.

strategic facility management

Job order contacting relationship model

job order contracting value-based

job order contacting strategy

job order contracting

INDUSTRY: SPACE MANAGEMENT
Competency: Space Planning, Utilization
Metrics/Cost Models
􀀹 Annualized Total Cost of Ownership (TCO) per building per gross area = Rate per square foot
􀀹 Annualized TCO per building/Current replacement value = Percent of Current Replacement Value (CRV)
􀀹 Annualized TCO per building/Net assignable square feet = Cost rate per net assignable square
feet per building
􀀹 Annualized TCO per building/Non-assignable square feet = Cost rate per non-assignable square
feet per building
􀀹 Annualized TCO per building/Building Interior square feet = Cost rate per interior square foot per
building
􀀹 Churn Rate
􀀹 Utilization Rate

Adequate Facility/Structure/Space
A facility/structure/space that is fully capable of supporting its current use without modification or repairs (beyond currently funded routine maintenance) and has an acceptable level of reliability.

Alteration
Work required to adjust interior arrangements or other physical characteristics of an existing facility/structure so that it may be more effectively adapted to or utilized for a new or changed use.

Assignable Square Feet
A term used to describe areas that may be occupied and is acceptable for a designated purpose or function. It does not include walls, stairways, corridors, restrooms, parking facilities or mechanical space.

Area/Gross Square Footage (GSF)

A unit of measure representing the cumulative total of an organization’s building(s) inclusive of all floors to the outside faces of exterior walls. Defined as the sum of the floor areas on all levels of a building that are totally enclosed within the building. Measure exterior building gross area to the outside face of exterior walls, disregarding canopies, cornices, pilasters, balconies and buttresses that extend beyond
the wall face and courtyards that are enclosed by walls but have no roof. The building exterior gross area of basement space includes the area measured to the outside face of basement or foundation walls. Exterior bridges and tunnels that are totally enclosed, constructed areas connecting two or more buildings are included in building exterior gross area. This measurement indicates total constructed space and is useful for building efficiency and construction cost comparisons. (Source: ASTM E 1836-01)

Building Core and Service Area
Defined as the floor area of a facility, which is necessary for the operation of the facility and is not available for general occupancy. This may include the following: building lobbies, mechanical rooms, electrical rooms, telephone (communications) rooms, restrooms, custodial rooms, loading docks and utility tunnels that are not used for any other purpose. (Source: ASTM E 1836-01)

Building Projections
A convector, baseboard heating unit, radiator, or other building element located in the interior of a building adjacent to a wall that prevents the use of that space for furniture, equipment, circulation or other functions. (Source: ASTM E 1836-01)

Box Move
No furniture moved, no new wiring or telecommunication systems required. Files and supplies moved. (Source: Project Management Benchmarks, IFMA © 2002)

Bullpen Style Offices
Open office areas with no partitions. (Source: Project Management Benchmarks, IFMA © 2002)

Churn Rate
The total number of moves made within a 12-month period of time divided by the number of occupants during the same period. (Source: Project Management Benchmarks, IFMA © 2002)

Common Support Areas
Facility assignable area includes the area devoted to common support services. Common support area is the portion of the facility usable area not attributed to any one occupant but provides support for several or all occupant groups. Examples of common support areas are: cafeterias, vending areas, auditoriums, fitness facilities, building mail rooms and first aid rooms. These may be separately identified as a sub-category of facility assignable area if required. (Source: ASTM E 1836-01)

Construction Move
New walls, new or additional wiring, new telecommunication systems or other construction needed to complete the move. (Source: Project Management Benchmarks, IFMA © 2002)

Excluded Area
Fully enclosed spaces with adequate clear headroom that are not intended for, or are not suitable for occupancy by people or equipment, but not spaces that are temporarily unusable due to flood, fire damage, construction or renovation activity. (Source: ASTM E 1836-01)

Exterior Walls
Defined as the width of the walls as measured at the intersection of the plane of the finished floor and the finished interior surface of the walls. (Source: ASTM E 1836-01)

Facility Assignable Area
Calculated by measuring the portions of the floor used to house personnel, furniture, support areas and common support areas. Each assignable area is measured to the outside of the enclosing wall or furniture panel except in the case where a wall or furniture panel is common to more than one assignable area. In this case measurements are taken to the center of the wall or furniture panel. This measurement is useful for detailed programming, planning, allocating and layout of space. (Source:
ASTM E 1836-01)

Facility Interior Gross Area
Defined as the building exterior minus the thickness of the exterior walls. (Source: ASTM E 1836-01)

Facility Rentable Area
Calculated by subtracting major vertical penetrations, interior parking space and void areas from facility
interior gross area. (Source: ASTM E 1836-01)

Facility Usable Area
Calculated by subtracting the primary circulation and the building core and service areas from the facility rentable area. It is area that can be assigned to occupant groups. This measurement is useful for programming, planning and allocating space. (Source: ASTM E 1836-01)

Finished Surface
A wall, ceiling or floor surface (including glass) as prepared for tenant or occupant use. Excluding the thickness of any special surfacing materials such as paneling, furring strips and carpet. (Source: ASTM E 1836-01)

Furniture Move
Reconfiguration of existing furniture and/or furniture moved or purchased. Minimal telecommunication reconfiguration needed. (Source: Project Management Benchmarks, IFMA © 2002)

Interior Parking Space
Defined as space used for vehicular parking space that is totally enclosed within the (occupied) building envelope. (Source: ASTM E 1836-01)

Interstitial Area
The area of load-bearing surfaces, located above or below occupied building floors that are not available for general occupancy due to inadequate clear headroom, but may contain building mechanical or electrical systems predominantly serving adjacent floors or provide access to such systems. (Source: ASTM E 1836-01)

Major Vertical Penetrations
Includes stairs, elevator shafts, utility tunnels, flues, pipe shafts, vertical ducts and their enclosing walls.
(Source: ASTM E 1836-01)

Open Plan Offices
Office spaces divided by movable partitions. (Source: Project Management Benchmarks, IFMA © 2002)

Primary Circulation
Defined as the portion of a building that is a public corridor or lobby. Further defined as space required for access by all occupants on a floor to stairs, elevators, restrooms and building entrances or tenant space entry points on multi-tenant floors. (Source: ASTM E 1836-01)

Private Office
Enclosed office, enclosed floor to ceiling walls. (Source: Project Management Benchmarks, IFMA © 2002)

Secondary Circulation
Defined as the portion of a building or floor required for access to some subdivision of space that is not defined as primary circulation. Secondary circulation may or may not be surrounded by walls or furniture panels. (Source: ASTM E 1836-01)

Space Planning
Space Planning is the process of analyzing current and future requirements relative to physical assets (i.e., type, condition, size, capacity, with respect to their ability to support and advance programs and activities at a level deemed appropriate by appropriate parties in concert with associated regulations, codes, mandates, and acceptable levels of performance). Space planning typically involves identifying
each distinct type of activity covered by the program and defining the appropriate values relative to size, capacity, utilization rates, etc.

Swing Space
Temporary space dedicated to displaced workers until permanent space is finished. (Source: Project Management Benchmarks, IFMA © 2002)

Utilization Rate
An indicator used to determine how efficiently available space is being used. Usually time-based in terms of month, quarter or year.
Utilization Rate = Occupied Space
Facility Usable Area

Void Areas
Defined as rooms that are more than one story in height. Void areas exist on upper floors such as atriums, light wells or lobbies. (Source: ASTM E 1836-01)

Workstation
Defined as any type of space designated for occupant usage (either open or enclosed area), where an
occupant can be seated. (Source: Project Management Benchmarks, IFMA © 2002)

INDUSTRY: SPACE MANAGEMENT
Competency: Programming
Metrics/Cost Models
􀀹 AI (Adaptation Index) or PI (Programmatic Index) = PR (Program Requirements)
CRV (Current Replacement Value)
􀀹 Uptime or Downtime – Defined in percent, as amount of time asset is suitable for the program(s) served.

Adaptation Index or Adequacy Index (AI) or Programmatic Index (PI)
A comparative inter/intra sector metric/benchmark expressed a value from 0.0 to 1.0 that indicate the program/mission-based condition of a facility. AI is calculated by dividing the total value of deferred physical programmatic/adaptive requirements (PR) by the current replacement value (CRV) (i.e. AI=PR/CRV).
Program-based or programmatic requirements are facilities-specific needs that are established to meet the mission of the facility or organization, inclusive of evolving technological, programmatic or regulatory demands.
Taking an educational science laboratory as an example, while an existing lab may have zero physical deficiencies the configuration and equipment (e.g. fume hoods, lighting, computer networks, etc.) may not be suitable for current teaching methods. All of the physical, program-related needs therefore have a cost to remedy, and are considered as programmatic deficiencies. Similar to physical deferred maintenance, deferred programmatic requirements are those current needs that are not funded in the present fiscal year. Additionally, the facilities-specific programmatic requirements may include items such as space, configuration, adjacency, security, etc.

Adequate Facility/Structure/Space
A facility/structure/space that is fully capable of supporting its current use without modification or repairs (beyond currently funded routine maintenance), and has an acceptable level of reliability.

Alteration
Work required to adjust interior arrangements or other physical characteristics of an existing facility/structure so that it may be more effectively adapted to or utilized for a new or changed use.

Assignable Square Feet
A term used to describe areas that may be occupied and is acceptable for a designated purpose or function. It does not include walls, stairways, corridors, restrooms, parking facilities or mechanical space.

Facility Usable Area
Calculated by subtracting the primary circulation and the building core and service areas from the facility rentable area. It is area that can be assigned to occupant groups. This measurement is useful for programming, planning and allocating space. (Source: ASTM E 1836-01)

Programming
Programming is the process of planning and organizing the quantitative physical requirements of resources needed to accomplish established goals. A program is an organized set of activities directed toward a common purpose or goal undertaken or proposed in support of an assigned area. A program is characterized by a strategy for accomplishing a definite objective(s), which identifies the means of accomplishment,
particularly in quantitative terms, with respect to manpower, materials, and facilities requirements. A program normally includes an element of ongoing activity and is typically comprised of technology-based activities,
projects, and supports an established level of reliability.

INDUSTRY: PROJECT DELIVERY
Competency: Design, Construction
Metrics / Cost Models
􀀹 Estimating Index (Source: SAM Initiative, APPA 2003)
􀀹 Delivery Speed, Cost Rate of Facility to Completion, Dollar per square foot per month (Source:
Selecting Project Delivery Systems, Sanudio/Konchar, 1999)
􀀹 Project Soft Cost Index (Source: SAM Initiative, APPA 2003)
􀀹 Total Cost (inclusive of construction, design, project management, etc.)/square foot vs. Regionalized Applicable Standard Reference Cost, Percent Variance

Architecture and Engineering Costs
All actual/projected costs charged by the architecture and engineering firms to a project. Total actual project costs represent the total actual cost to complete and close a project.

Construction
Any combination of engineering, procurement, erection, installation, assembly or fabrication activities involved
to create a new facility/structure or to alter, add to, or rehabilitates an existing facility/structure, and its support areas such as parking, grounds, roadways, service buildings for power generation, waste disposal, etc., and the costs to construct interior spaces including the costs of ceilings, lighting, life safety such as sprinklers,
heating, ventilation, air conditioning, floor systems, carpeting, walls, doors, hardware and special finishes.

Design
Design begins with and is the analysis, understanding and response to the base of data, intentions, and impressions collected in the process of discovering what there is to know about a project. The combination of all this into a unified solution is the synthesis that is the core of design.

Estimating Index
The purpose of the estimating index is to measure the accuracy and credibility of the estimate as compared to actual work accomplished. The index is usually used for measuring performance for projects or reimbursable work orders. Different size projects may be accomplished so differently that they may be grouped into several
categories with an estimating index calculated for each. Deviations outside of a reasonable range of values should be examined for opportunities to learn and improve the estimating process. The use of this indicator should also encourage field personnel to be innovative in reducing actual time and costs. As with any cycle of improvement, consistent performance above or below 1.00 will indicate that the estimates are no longer credible and that the estimates need to be adjusted to reflect the actual level of productivity. The estimating index is the ratio of actual time or costs to do work divided by estimated time or costs. The unit of measurement should be the same for both actual and estimated. Time is usually measured in days and costs
are usually measured in whole dollars. When measuring the average performance over a period of time, such as monthly, the number of samples can vary so long as they contain a representative mix to provide reasonable accuracy. The index is usually represented as a decimal number. The estimating index will be greater than 1.00 when the actual time or costs exceeds the estimate. Similarly, the estimating index will be
less than 1.00 when the actual time or costs is less than the estimate.
Estimating Index = Actual Time or Costs
Estimated Time or Costs
(Source: SAM Initiative: APPA 2003)

job order contracting

Project Soft Cost Index
The purpose of this performance indicator is to determine the relative percentage of soft costs in a project. A smaller percentage implies a more efficient use of project funds. The performance indicator can be used to determine how efficiently project funds are utilized for individual projects or to trend cumulative results and
variances for numerous projects over time. These costs are related to those items in a project that are necessary to prepare and complete the non-construction needs of the project. Soft costs include such items as architecture, design, engineering, permits, inspections, consultants, environmental studies and regulatory
demands needing approval before construction begins. Soft costs do not include construction, telecommunications, furnishings, fixed equipment and expenditures for any other permanent components of
the project.
Project Soft Cost Index = Soft Costs
Adjusted Total Actual Project Cost
(Source: SAM Initiative: APPA 2003)

Construction Management At-Risk
Defining Characteristics:
• Separate contracts for design and construction.
• Final selection of builder is based on any combination of Total Construction Costs and other criteria.
Available Selection Options:
• Qualifications Based Selection.
• Best Value Bid.
Typical Characteristics:
• Builder selection occurs during design.
• Builder selection based on a “qualifications based selection” (that may or may not include fees and/or general conditions).
• Builder provides a cost guarantee Guaranteed Maximum Price (GMP) and a schedule guarantee either
during or after their final selection.
• Builder is able to provide input such as cost, schedule and constructability during design.
• Overlapping of design and construction phases (fast-tracking) of the project is typical.
• Cost guarantee provided in the form of a not-to-exceed Guaranteed Maximum Price (GMP).
• Selection of designer and builder are independent processes.
Note: For each of the project delivery methods found below, Design-Build, Design-Bid-Build, and Construction Management At- Risk, the method’s “defining” characteristics, the available selection options (based on definitions provided) and a few sample “typical” characteristics of each method are provided for clarification purposes.
“Defining Characteristics” – Prescribe a delivery method and uniquely distinguish a delivery method from the other delivery methods.
Available Selection Options (definitions):
• Low Bid – Builder’s final selection based 100% on lowest Total Cost and no other criterion.
• Best Value Bid – Builder’s final selection based on some weighting of the Total Cost and other criterion such as
qualifications.
• Qualifications Based Selection – Total Construction Cost not a factor in the builder’s final selection. The final selection of the builder is based on either:
o Pure qualifications based selection (qualifications only, no element of price) or
o A combination of qualifications and fees (possibly including general conditions).
“Typical Characteristics” – Typical characteristics may be “typical” characteristics of a delivery method, but are not required to define the delivery method.

Design/Bid/Build
Defining Characteristics:
• Separate contracts for design and construction.
• Final selection of builder is based usual on Total Construction Cost.
Available Selection Options:
• Low Bid Only (based on the “defining characteristics”).
• Best Value.
Typical Characteristics:
• Design is typically near 100% complete at time of final builder selection.
• The construction phase follows the design phase (after bid process) in linear fashion.
• Selection of designer and builder are independent processes.
Design/Build
Defining Characteristics
• A single contract for design and construction.
Available Selection Options:
• Qualifications Based Selection.
• Best Value Bid.
• Low Bid.
Typical Characteristics:
• Design-Builder able to provide input such as cost, schedule and constructability during design.
• Overlapping of design and construction phases (fast-tracking) of the project.
• Cost guarantee provided in the form of a not-to-exceed Guaranteed Maximum Price (GMP).

INDUSTRY: OPERATIONS MANAGEMENT
Competency: Operations
Metrics/Cost Models
􀀹 Facility Operating Gross Square Foot (GSF) Index (SAM Performance Indicator: APPA 2003)
􀀹 Custodial Costs per square foot
􀀹 Grounds Keeping Costs per square foot
􀀹 Energy Costs per square foot
􀀹 Energy Usage
􀀹 Utility Costs per square foot
􀀹 Waste Removal Costs per square foot
􀀹 Facility Operating Current Replacement Value (CRV) Index (SAM Performance Indicator: APPA 2003)

Energy Usage
This performance indicator is expressed as a ratio of British Thermal Units (BTUs) for each Gross Square Foot (GSF) of facility, group of facilities, site or portfolio. This indicator represents a universal energy consumption metric that is commonly considered a worldwide standard. This energy usage metric can be tracked over a
given period of time to measure changes and variances of energy usage. Major factors that effect BTU per gross square foot are outside ambient temperature, building load changes, and equipment efficiencies. The amount of energy it takes for heating, cooling, lighting and equipment operation per gross square foot. The
indicator is traditionally represented as total energy consumed annually or monthly. All fuels and electricity are converted to their respective heat, or BTU content, for the purpose of totaling all energy consumed.
Energy Usage = British Thermal Units = BTUs
Gross Area = GSF

Facility Operating Current Replacement Value (CRV) Index
This indicator represents the level of funding provided for the stewardship responsibility of an organization’s capital assets. The indicator is expressed as a ratio of annual facility maintenance operating expenditure to current replacement value (CRV). Annual facility maintenance operating expenditures includes all
expenditures to provide service and routine maintenance related to facilities and grounds. It also includes expenditures for major maintenance funded by the annual facilities maintenance operating budget. This category does not include expenditures for major maintenance and/or capital renewal funded by other accounts, nor does it include expenditures for utilities and support services such as mail, telecommunications, public safety, security, motor pool, parking, environmental health and safety, central receiving, etc.
Facility Operating CRV Index = Annual Facility Maintenance Operating Expenditures ($)
Current Replacement Value ($)

Facility Operating Gross Square Foot (GSF) Index
This indicator represents the level of funding provided for the stewardship responsibility of an organization’s capital assets. The indicator is expressed as a ratio of annual facility maintenance operating expenditure to the institutions gross area. Annual facility maintenance operating expenditures includes all expenditures to
provide service and routine maintenance related to facilities and grounds. It also includes expenditures for major maintenance funded by the annual facilities maintenance operating budget. This category does not include expenditures for major maintenance and/or capital renewal funded by other institutional accounts, nor
does it include expenditures for utilities and support services such as mail, telecommunications, public safety, security, motor pool, parking, environmental health and safety, central receiving, etc.

Facility Operating GSF Index = Annual Facility Maintenance Operating Expenditures ($)
Gross Area (GSF)

Operations
All activities associated with the routine, day to day use, support and maintenance of a building or physical asset; inclusive of administration, management fees, normal/routine maintenance, custodial services and cleaning, fire protection services, pest control, snow removal, grounds care, landscaping, environmental
operations and record keeping, trash-recycle removal, security services, service contracts, utility charges (electric, gas/oil, water), insurance (fire, liability, operating equipment) and taxes. It does not include capital improvements. This category may include expenditures for service contracts and other third-party costs.
Operational activities may involve some routine maintenance and minor repair work that are incidental to operations but they do not include any significant amount of maintenance or repair work that would be included
as a separate budget item.

Normal/Routine Maintenance and Minor Repairs
Cyclical, planned work activities funded through the annual budget cycle, done to continue or achieve either the originally anticipated life of a fixed asset (i.e., buildings and fixed equipment), or an established suitable level of performance. Normal/routine maintenance is performed on capital assets such as buildings and fixed equipment to help them reach their originally anticipated life. Deficiency items are low in cost to correct and are normally accomplished as part of the annual operation and maintenance (O&M) funds. Normal/routine maintenance excludes activities that expand the capacity of an asset, or otherwise upgrade the asset to serve
needs greater than, or different from those originally intended.

Predictive Maintenance/Testing/Inspection
Routine maintenance, testing, or inspection performed to anticipate failure using specific methods and equipment, such as vibration analysis, thermographs, x-ray or acoustic systems to aid in determining future maintenance needs. For example, tests to locate thinning piping, fractures or excessive vibration that are indicative of maintenance requirements.

INDUSTRY: OPERATIONS MANAGEMENT
Competency: Planned Maintenance
Metrics/Cost Models
􀀹 Planned/Preventive Maintenance Costs per square foot

Planned or Programmed Maintenance
Includes those maintenance tasks whose cycle exceeds one year. Examples of planned or programmed maintenance are painting, flood coating of roofs, overlays and seal coating of roads and parking lots, pigging of constricted utility lines and similar functions.

Preventive Maintenance
A planned, controlled program of periodic inspection, adjustment, cleaning, lubrication and/or selective parts replacement of components, and minor repair, as well as performance testing and analysis intended to maximize the reliability, performance, and lifecycle of building systems, equipment, etc. Preventive
maintenance consists of many check point activities on items, that if disabled, may interfere with an essential installation operation, endanger life or property, or involve high cost or long lead time for replacement.

INDUSTRY: OPERATIONS MANAGEMENT
Competency: User Requested Needs
Metrics/Cost Models
􀀹 Emergency Maintenance Costs as a percentage of Annual Operations Expenditures.
􀀹 Unscheduled/Unplanned Maintenance Costs as a percentage of Annual Operations Expenditures.

Emergency Maintenance
Unscheduled work that requires immediate action to restore services, to remove problems that could interrupt activities, or to protect life and property.

Unscheduled/Unplanned Maintenance
Reactive and non-emergency corrective work activities that occur in the current budget cycle or annual program. Activities may range from unplanned maintenance of a nuisance nature requiring low levels of skill for correction, to non-emergency tasks involving a moderate to major repair or correction requiring skilled
labor.

INDUSTRY: OPERATIONS MANAGEMENT
Competency: Repairs
Metrics/Cost Models
􀀹 Repair costs (man hours and materials) as a percentage of Annual Operations Expenditures

Repair(s)
Work that is performed to return equipment to service after a failure, or to make its operation more efficient.
The restoration of a facility or component thereof to such condition that it may be effectively utilized for its designated purposes by overhaul, reprocessing, or replacement of constituent parts or materials that have deteriorated by action of the elements or usage and have not been corrected through maintenance.

Routine Repairs
Actions taken to restore a system or piece of equipment to its original capacity, efficiency or capability.
Routine repairs are not intended to increase significantly the capacity of the item involved. For example, the replacement of a failed boiler with a new unit of similar capacity would be a routine repair project. However, if the capacity of the new unit were double the capacity of the original unit, the cost of the extra capacity would
have to be capitalized and would not be considered routine repair work.

Emergency Repairs
Requests for system or equipment repairs that are unscheduled and unanticipated. Service calls generally are received when a system or component has failed and/or perceived to be working improperly. If the problem has created a hazard or involves an essential service, an emergency response may be necessary.
Conversely, if the problem is not critical, a routine response is adequate.

Unscheduled/Unplanned Maintenance
Requests for system or equipment repairs that – unlike preventive maintenance work – are unscheduled and unanticipated. Service calls generally are received when a system or component has failed and/or perceived to be working improperly. If the problem has created a hazard or involves an essential service, an emergency response may be necessary. Conversely, if the problem is not critical, a routine response is adequate.
Reactive and/or emergency corrective work activities that occur in the current budget cycle or annual program.
Activities may range from unplanned maintenance of a nuisance nature requiring low levels of skill for correction, to non-emergency tasks involving a moderate to major repair or correction requiring skilled labor, to emergency unscheduled work that requires immediate action to restore services, to remove problems that
could interrupt activities, or to protect life and property.

INDUSTRY: CAPITAL ASSET MANAGEMENT
Competency: Retrofits/Upgrades
Metrics / Cost Models
􀀹 FCI (Facility Condition Index) = DM (Deferred Maintenance) + CR (Capital Renewal)
CRV (Current Replacement Value)
􀀹 Recapitalization Rate, Reinvestment Rate
􀀹 Deferred Maintenance Backlog
􀀹 Facilities Deterioration Rate

Capital Asset Management
The identification and prioritization of facility and infrastructure physical, functional, and budgetary needs, spanning a multi-year timeframe. Also includes the process of reinvesting funds into physical assets in support of the organizational mission, above and beyond normal routine operations and maintenance.

Capital (Major) Maintenance/Repairs
Previous or future repairs or replacement, paid from the capital funds budget and not funded by normal
maintenance resources received in the annual operating budget cycle.
• Repairs – work to restore damaged or worn-out assets/systems/components (e.g., large scale roof
replacement after a wind storm) to normal operating condition.
• Replacement – an exchange of one fixed asset for another (e.g., replacing a transformer that blows up and shuts down numerous buildings) that has the same capacity to perform the same function.
Minimum dollar threshold levels for capital renewal are set by the building owners/manager, however typically
in excess of $5,000 or $10,000.

Deferred Maintenance/Deferred Maintenance Backlog/Accumulated Deferred Maintenance Backlog
The total dollar amount of existing maintenance repairs and required replacements (capital renewal), not accomplished when they should have been, not funded in the current fiscal year or otherwise delayed to the future. Typically identified by a comprehensive facilities condition assessment/audit of buildings, grounds,
fixed equipment and infrastructure. These needs have not been scheduled to be accomplished in the current budget cycle and thereby are postponed until future funding budget cycles. The projects have received a lower priority status than those to be completed in the current budget cycle. For calculation of facility condition index
(FCI) values, deferred maintenance does not include grand fathered items (e.g., ADA), or programmatic requirements (e.g, adaptation).

Deferred Maintenance Backlog Deterioration/Plant (Facilities) Deterioration Rate
Facilities and equipment are in a constant state of degradation. While identified deficiencies/requirements are being corrected, other deficiencies/requirements are continuously being created over time. The rate of deterioration may be expressed as a percentage of current replacement value per year. While degradation
rates vary as a function of multiple variables such as building type, current conditions, geographic location, etc., a benchmark deterioration rate for a reasonably well maintained facility is approximately 2.5% per annum.
Varying annual capital reinvestments into the physical plant and equipment may alter the degradation rate. The facility condition index (FCI) can be used as comparative metric to help monitor degradation rates.

Deficiency/Requirement (Facility/Structure/Asset)
The quantitative difference, typically in terms of dollars amount and associated physical requirements, between an assets current physical or functional condition, and an established minimum level of condition/performance.
Any problem or defect with materials or equipment.

Facility Condition Assessment (FCA)/Audit
The structured development a profile of existing facilities conditions, typically placed in an electronic database format, and populated with detailed facility condition inspection information. A detailed facility condition assessment (FCA’s) typically involve an assessment team of three professionals (architect, mechanical
engineer, electrical engineer), and depend up robust, scalable methodologies to assure accurate and consistent information. It is recommended that FCA’s be done on a regular basis, approximately every three years, or conducting a portion of the overall portfolio annually. The FCA identifies existing deficient conditions
(requirements), in logical grouping and priorities, and also, associated recommended corrections and corrective costs. Costs are generally based upon industry standard cost databases (e.g., Building News, Craftsman Book Company, Richardson General Construction Estimating Standards, RSMeans).

Facility Conditional Assessment Program (Facility Capital Planning and Management Program)
A continuous systematic approach of identifying, assessing, prioritizing, and maintaining the specific maintenance, repair, renewal, and replacement requirements for all facility assets to provide valid documentation, reporting mechanisms, and budgetary information in a detailed database of facility issues.

Facility Condition Index (FCI)
A comparative industry indicator/benchmark used to indicate the relative physical condition of a facility, group of buildings, or entire portfolio “independent” of building type, construction type, location or cost. The facility condition index (FCI) is expressed as a ratio of the cost of remedying existing deficiencies/requirements, and
capital renewal requirements to the current replacement value (i.e., FCI=(DM+CR)/CRV). The FCI provides a
corresponding rule of thumb for the annual reinvestment rate (funding percentage) to prevent further accumulation of deferred maintenance deficiencies. The FCI value is a snapshot in time, calculated on an annual basis. Forecasted FCI values for a building in the future, for example, would include the current deferred maintenance items, plus projected values of capital renewal requirements. The FCI is represented on
a scale of zero to one, or 0% to 100%, with higher FCI values, representing poorer facility’s condition. While property owners/managers establish independent standards, a “fair to good facility” is generally expressed as having an FCI of less than 10-15%.

(FCI) = Deferred Maintenance + Capital Renewal (see definition for Deferred Maintenance)

Current Replacement Value (see definition for Current Replacement Value)

Programmed Major Maintenance: Includes those maintenance tasks whose cycle exceeds one year. Examples of programmed major maintenance are painting, roof maintenance, (flood coating), road and parking
lot maintenance (overlays and seal coating), utility system maintenance (pigging of constricted lines) and similar functions.

Recapitalization/Reinvestment Rate
A facility, system, or component with existing deficiencies will deteriorate at a faster rate than a component that
is in good condition. The level of annual funding for facility renewal and deferred maintenance expressed as a percentage of facility replacement values. Altering the recapitalization/reinvestment rate has direct impact upon the facility condition index (FCI) and associated deferred maintenance levels over time.

Systems Lifecycle Costing
An estimating procedure used to determine the cost of facility system/component renewal based on the average useful life of an individual component. This procedure is typically based upon visual observations, via a facilities conditions assessment/audit, to determine the remaining useful life of a system and the development of cost models for the facility. This process enables multi-year modeling of future replacement
costs and timing.

INDUSTRY: CAPITAL ASSET MANAGEMENT
Competency: Improvements
Metrics / Cost Models
􀀹 FCI (Facility Condition Index) = DM (Deferred Maintenance) + CR (Capital Renewal)
CRV (Current Replacement Value)
􀀹 AI (Adaptive Index) or PI (Programmatic Index) = PR (Program Requirements)
CRV (Current Replacement Value)
􀀹 FQI (Facility Quality Index) or Quality Index or Index = FCI (Facility Condition Index)+ AI (Adaptive Index)

Adaptation/Renovation/Modernization
The improvement, addition or expansion of facilities by work performed to change the interior alignment of space or the physical characteristics of an existing facility so it can be used more effectively, be adapted for new use, or comply with existing codes. Includes the total amount of expenditures required to meet evolving
technological, programmatic or regulatory demands.

Adaptation Index or Adequacy Index (AI)/Programmatic Index (PI)
A comparative inter/intra sector metric/benchmark expressed a value from 0.0 to 1.0 that indicate the program/mission-based condition of a facility. AI is calculated by dividing the total value of deferred physical programmatic/adaptive requirements (PR) by the current replacement value (CRV) (i.e., AI=PR/CRV).
Program-based or programmatic requirements are facilities-specific needs that are established to meet the mission of the facility or organization, inclusive of evolving technological, programmatic or regulatory demands.
Taking an educational science laboratory as an example, while an existing lab may have zero physical deficiencies the configuration and equipment (fume hoods, lighting, computer networks, etc.) may not be suitable for current teaching methods. All of the physical, program-related needs therefore have a cost to remedy and are considered as programmatic deficiencies. Similar to physical deferred maintenance, deferred
programmatic requirements are those current needs that are not funded in the present fiscal year. Additionally, the facilities-specific programmatic requirements may include items such as space, configuration, adjacency,
security, etc.

Improvements
A change or addition to an asset that improves its performance or appearance and/or extends its useful life.

Replacement of Obsolete Items
Refers to work undertaken to bring a component or system into compliance with new codes or safety regulations or to replace an item that is unacceptable, inefficient, or for which spare parts can no longer be obtained.

INDUSTRY: CAPITAL ASSET MANAGEMENT
Competency: Replacements
Metrics / Cost Models
􀀹 FCI (Facility Condition Index) = DM (Deferred Maintenance) + CR (Capital Renewal)
CRV (Current Replacement Value)
􀀹 AI (Adaptive Index) or PI (Programmatic Index) = PR (Program Requirements)
CRV (Current Replacement Value)
􀀹 FQI (Facility Quality Index) or Quality Index or Index = FCI (Facility Condition Index)+ AI (Adaptive Index)
􀀹 Capital Renewal Index (SAM Performance Indicator: APPA 2003)

Capital Project/Construction
A new facility, rehabilitation/renovation or major maintenance that increases the value of the location/site/campus (e.g., a new building) or extends the useful life of a facility. This work includes construction and purchase of fixed equipment. (e.g., a replacement chiller). Minimum dollar threshold levels for capital projects are set by the building owners/managers, however typically in excess of $5,000 or $10,000.

Capital Renewal (CR)/ Replacement
The systematic management process of planning and budgeting for known future cyclical repair and replacement requirements that extend the life and retain the usable condition of facilities and systems, not normally contained in the annual operating budget. This includes major activities that have a maintenance
cycle in excess of one year (e.g., replace roofs, paint buildings, resurface roads, etc.). The cyclical replacement may be for all or a significant portion (e.g., the replacement of 50% or more of a building system component (lighting system, roof system, etc.) as it reaches the end of its useful life, of major components or infrastructure systems, at or near the end of their useful service life. These activities may extend the useful life
and retain the usable condition of an associated capital asset (e.g., replacement of an HVAC system, extending the usable life of a facility). Replacement may be capitalized based on the Governmental Accounting Standards Board/Financial Accounting Standards Board (GASB/FASB) definition. A depreciation model calculates a sinking fund for this maintenance activity. Costs are estimated by a current replacement
value that is derived by industry standard cost databases, (e.g., Building News, Craftsman Book Company, Richardson General Construction Estimating Standards, RSMeans).

Capital Renewal Index
This indicator shows the relative funding effectiveness in addressing identified capital renewal and renovation/modernization needs. The numerator of this ratio is a total of the annual capital renewal expenditure and the annual renovation/modernization expenditure. Annual Capital Renewal Expenditures are all expenditures over and above facility maintenance operating budget expenditures required to keep the physical plant in reliable operating condition for its present use. These expenditures are over and above normal maintenance for items with a lifecycle in excess of one year and are not normally contained in an annual facility operating budget. This is a separately funded, uniquely identified program that renews, replaces, or renovates building systems on a schedule based on lifecycle recommendations and on assessment of expected remaining useful life. This is typically represented as a total expenditure for capital
renewal of an organization’s capital assets. Plant renewal focuses on maintaining the operability, suitability, and value of capital assets. It is accomplished through the replacement and rework of those components of a building that wear out even though those components are routinely maintained. Capital or plant renewal is a time-driven process with specific useful life cycles for heating and ventilation systems, etc. This is often provided in the form of capital funding for “major maintenance” before it becomes “deferred.”

Capital Renewal Index = Annual Capital Renewal and Renovation/Modernization Expenditure ($)
Current Replacement Value ($)
(SAM Performance Indicator: APPA 2003)

Current Replacement Value (CRV)
The total expenditure in current dollars required to replace any facility at the institution, inclusive of construction costs, design costs, project management costs and project administrative costs. Construction costs are calculated as replacement in function vs. in-kind. The value of design (6%), project management (10-12%),
and administrative costs (4%) can be estimated at 20% of the construction cost. The value of property/land however is excluded, and insurance replacement values or book values should not be used to define the current replacement value. Costs for the replacement value are typically generated using a cost models based upon the use of reference cost databases using the building construction type, user and use categories, quality level, buildings systems and or subsystems/components/units, and local experience. The property owner/manager may decide, for internal purposes, to base the current replacement value (CRV) on “replacement in kind” (duplicate constructions techniques), vs. “replacement in function” (e.g., six story office
space). The CRV’s for associated infrastructure, such as utility systems, and generating plants, roadways, non-building structures (e.g., dam, bridges, etc.) are developed in a similar manner.

Replacement of Obsolete Items
Refers to work undertaken to bring a component or system into compliance with new codes or safety regulations or to replace an item that is unacceptable, inefficient, or for which spare parts can no longer be obtained.

Facility Quality Index (FQI)/Quality Index (QI)/Index
An overall metric of facility quality inclusive of both physical and facility-specific programmatic requirements.
Expressed in a value of 0.0 to 2.0 the facility quality index is calculated as follows:
Facility Quality Index (FQI) = Deferred Maintenance (DM)+Capital Renewal (CR)+Program Requirements (PR)
Current Replacement Value ($)

Total Cost of Ownership (TCO)/Lifecycle Cost Management
Total cost of ownership (TCO) is a dollar per square foot value ($#/square foot) associated with a facility. It is a calculation of all facilities-specific costs (not including furnishings or non-facility specific equipment) divided by estimated lifespan of the building (30 or 50 years), and the total gross area. Facilities specific costs include
all construction, preservation, maintenance, and operations costs. A strategic asset management practice that considers all costs of operations and maintenance, and other costs, in addition to acquisition costs. TCO, therefore includes the representation of the sum total of the present value of all direct, indirect, recurring and non-recurring costs incurred or estimated to be incurred in the design, development, production, operation, maintenance of an facility/structure/asset over its anticipated lifespan. (Inclusive of site/utilities, new construction, deferred maintenance, preventive/routine maintenance, renovation, compliance, capital renewal, and occupancy costs.) Again, note that land values are specifically excluded.

Real Property – Best Management Practices

As a real property owner, can you answer the following questions?

  1. What is the Average Facility Condition Index – FCI?
  2.  What is the average cost of a Requirement relative to your Deferred Maintenance?
  3.  What is the average Requirement Cost per Square Foot?
  4.  What is the total Replacement Cost for your portfolio? Per Building?
  5.   What is the total Number of your building Assets?
  6.   What is the total Square Foot Area of your buildings?

Information-based decision support is critical to the efficient life-cycle management of the built environment.    How are you monitoring functionality, obsolescence, life safety, ADA, building codes, appearance, capacity, utilization, energy use, integrity …

These are just a sampling of basic data needed to better allocate your resources.

Federal Real Property Facility Managment

jobordercontracting.org

 

Construction Productivity must be Owner driven – BIM, IPD, JOC

One thing is clear, the construction sector (architecture, engineering, contractors, owners, operators, users, suppliers) has been lagging virtually all other business sectors for decades with respect to productivity improvement.

I believe that the cause is largely cultural, however, any major improvement must be driven by Owners,and/or mandated by governmental regulation.

My reasoning is simple, Owners pay the bills.  Thus as long as Owners remain satisfied with the status quo and/or remain “uneducated” with respect to proven business “best practices” and lean management processes, as well as supporting technologies, economic and environmental waste will continue to be rampant.

Currently, my outlook is somewhat pessimistic.  If one looks at  capability and knowledge specific to life-cycle  facility management from an industry perspective, most has originated with the government sector, followed by higher education, state government, healthcare, process-based industries, etc. etc.    Basically, Owners whose mission is dependent upon their built environment tend to create and follow life-cycle management practices. These are Owners that can’t adopt a “churn and burn”, or “run to failure” approach to facility management.  These sectors can’t easily pack up and move if their facilities and physical infrastructure fail.

That said, even government owners, for the most part, have failed in any sort of department or agency-wide adoption of standardized best practices.  This is true even for  “simple” areas such as facility repair, maintenance, and renovation.  Only the Air Force appears to come close to having any true adoption of robust, proven, best-practices in this regard, as well as associated training, etc., most notably with their SABER construction delivery structure.

In order to effect measurable productivity improvement in the “construction” sector, , I have put together a core requirements “checklist”.

1. Robust Ontology – Cost effective information management and information reuse can only be accomplished with a detailed set of terms, definitions, metrics, etc.  This aspect is also critical to improved strategic and tactical decision support mechanisms.

2. An understanding of life-cycle management of the built environment from a collaborative, best-practices, process perspective as well as associated supporting technologies.  Forget the traditional strategy-design-construction-demolish approach.

3. Commitment to a total cost of ownership perspective including both economic and environmental costs vs. our classic “first-cost” mentality.

4. “Trust but measure” – Owners MUST conduct their own internal cost estimating and associated capital planning and compare these to contractor estimates, with each party using the same  data architecture (examples: RSMeans, masterformat, uniformat, omniclass).

5. Adoption of collaborative construction delivery methods such as Integrated Project Delivery, IPD, and Job Order Contracting, JOC, in lieu of antagonistic and inefficient design-bid-built, or even design-build.

6. STOP reinventing the wheel.  Nothing noted here is “rocket science”.  Many, if not most, processes, procedures, and technologies are readily available for anyone who does a bit of basic research!!!   Also, stop with the focus upon BIM from a 3D visualization perspective!  3D tools are great, and add value, however, INFORMATION and PROCESS drive success.

 

BLM2

The Metrics of BIM – The Manage the Built Environment

As the old saying goes…”you can’t manage what you don’t measure”.

 

 

Here’s the beginning of a list of information requirements spanning various domains/competencies, technologies, etc.,
While an important component, the 3D component of BIM has been a very unfortunate distraction.  It appears that many/most have “gone to the weeds” and/or are “recreating the wheel” vs. working on core foundational needs such as the consistent use of appropriate terminology and the establishment of robust, scalable and repeatable business practices, methodologies, standards, metrics and benchmarks for facilities and physical infrastructure management.

It is common terminology that enables effective communication and transparency among the various decision makers, building managers, operators and technicians involved with facilities and physical infrastructure investment and management.

Here are examples of metrics associated with the life-cycle management of the built environment:

Annualized Total Cost of Ownership (TCO) per building per gross area = Rate per square foot

Annualized TCO per building/Current replacement value = Percent of Current Replacement Value (CRV)

Annualized TCO per building/Net assignable square feet = Cost rate per net assignable square feet per building

Annualized TCO per building/Non-assignable square feet = Cost rate per non-assignable square feet per building

Annualized TCO per building/Building Interior square feet = Cost rate per interior square foot per building

Churn Rate

Utilization Rate

AI (Adaptation Index) or PI (Programmatic Index) = PR (Program Requirements) /
CRV (Current Replacement Value)

Uptime or Downtime – Defined in percent, as amount of time asset is suitable for the program(s) served.

Facility Operating Gross Square Foot (GSF) Index (SAM Performance Indicator: APPA 2003)

Custodial Costs per square foot

Grounds Keeping Costs per square foot

Energy Costs per square foot

Energy Usage

Utility Costs per square foot

Waste Removal Costs per square foot

Facility Operating Current Replacement Value (CRV) Index (SAM Performance Indicator: APPA 2003)

Planned/Preventive Maintenance Costs per square foot

Emergency Maintenance Costs as a percentage of Annual Operations Expenditures.

Unscheduled/Unplanned Maintenance Costs as a percentage of Annual Operations Expenditures.

Repair costs (man hours and materials) as a percentage of Annual Operations Expenditures

FCI (Facility Condition Index) = DM (Deferred Maintenance) + CR (Capital Renewal)
/ CRV (Current Replacement Value)

Recapitalization Rate, Reinvestment Rate

Deferred Maintenance Backlog

Facilities Deterioration Rate

FCI (Facility Condition Index) = DM (Deferred Maintenance) + CR (Capital Renewal) /
CRV (Current Replacement Value)

AI (Adaptive Index) or PI (Programmatic Index) = PR (Program Requirements) /
CRV (Current Replacement Value)

FQI (Facility Quality Index) or Quality Index or Index = FCI (Facility Condition Index)+ AI (Adaptive Index)

BIMF - Building Information Management FrameworkVia http://www.4Clicks.com – Premier cost estimating and efficient project delivery software for the built environment – , …

The “I” for Information if Building Information Modeling or Life-cycle Facility Management

While articles and discussions continue about Facility Management and BIM, in reality they are virtual synonyms.

Facility management is a profession that encompasses multiple disciplines to ensure functionality of the built environment by integrating people, place, process and technology. – Definition of Facility Management – IFMA

Building Information Modeling (BIM) is a digital representation of physical and functional characteristics of a facility.  A BIM is a shared knowledge resource for information about a facility forming a reliable basis for decisions during its life-cycle; defined as existing from earliest conception to demolition. – NIBS

In order to achieve either efficiently I argue that Information and Process must be shared in a consistent, mutually understood format among all stakeholders of the built environment: Owners, AEs, Contractors, Sub-contractors, Business Product Manufacturers, Building Users, and Oversight Groups.

The problem remains, however, that many don’t understand the multiple knowledge domains or competencies associated with the life-cycle management of the built environment, nor how to integrated them.  What is even worse, is that some of those that do understand are unwilling to share that information due to perceived issues with doing so.

NBIMS and similar efforts are steps in the right direction.  NBIMS attempts to consolidate and communicate information requirements, models, and associated usage processes, with an “open industry” approach.

Owners must clearly push for BIM and Life-cycle Facility Management.  Why?  Simple…they pay the bills and it is in their best interests to optimize their return on investment (ROI).  That said, Owners can’t do it alone.  By the very nature of the industry, all stakeholders must collaborate.  Unlike an airplane, or car… buildings are around for 50-100 years, have multiple uses, and can be adapted to changing situations.. also a far greater number of suppliers and service providers are involved, as well as a virtually infinite number of configurations.

 

Here’s are quick graphic of just a few of the areas, competencies, and technologies involved:

BIMF - Building Information Management Framework

 

via http://www.4Clicks.com – Premier cost estimating and efficient project delivery software featuring an exclusively enhanced 400,000+ RSMeans Cost database and support for JOC, SABER, IDIQ, SATOC, MATOC, MACC, POCA, BOA, BOS, and more!

BIM, Value Management, Life-cycle Cost Management

Source:  International Journal of Facility Management, Vol 4, No 1 (2013), via http://www.4Clickscom – Premier cost estimating and efficient project delivery software for JOC, SABER, IDIQ, SATOC, MATOC, MACC POCA, BOA, BOA… including exclusively enhanced 400,000+ RSMeans line item cost database, contract/project/document management, and visual estimating/QTO.

BIM is the life-cycle management of the built environment supported by digital technology.  Unfortunately, too much emphasis has been placed upon 3-D visualization and other technology components vs. the process of life-cycle management.

Facility / Infrastructure Life Cycle Cost:   Costs associated with designing, acquiring, constructing, adapting, maintaining, repairing, and operating a built structure.

While Value Management is used as term in this paper, it is arguably interchangeable with Capital Planning and Management (CPMS).  The latter is a process involving the construction and management of physical and functional conditions of a built structure over time.

 

A CRITICAL REVIEW OF VALUE MANAGEMENT AND WHOLE LIFE COSTING ON CONSTRUCTION PROJECTS

Abdul Lateef A, Olanrewaju
Department of Civil Engineering, Universiti Teknologi PETRONAS,
Bandar Seri Iskandar 31750 Tronoh, Perak Darul Ridzuan

Correspondence: abdullateef.olanrewaju@ymail.com

ABSTRACT

It is the aim of this paper, to present the complexity of the body of knowledge capturing the range of conflicting assumptions and understanding on the theories and practices of value management (VM) and life cycle-cost (LCC). Life cycle cost in facility construction projects is a management tool that is used to analyze the cost of constructed facilities in terms of cost of acquiring the facility and as well as maintaining and operating the facility. It makes a lot of sense to consider the capital costs of projects with their associated operation and maintenance costs. This is so that the project that is procured would economically viable through its entire life span. The recent increase in demand for sustainable or green buildings is further making the consideration of life cycle cost an issue.

However, life cycle of the project alone is not sufficient as source of creating value to the clients and end users. Consequently, the need for value management emerges. Based on extensive literature review this paper has shown that the life cycle costing techniques is a tool in the value management methodology an basic finding from the connection is that both VM and LCC can be embedded into the wider context of FM.

Keywords: life cycle cost; value management; reflexivity in research, facility management, best value; construction projects

I. INTRODUCTION

In this paper, our aim is to represent the complexity of the body of literature capturing the range of conflicting assumptions and understandings about the theories and practice of VM and LCC. Before proceeding however, it is important to acknowledge what although we attempt to offer a balanced portrait of opposing views, our opinions and biases will come through whether we want them to or not. Although we are more comfortable with usual impersonal academic writing style, we believe it will help readers to differentiate what we believe from what other believe if we are honest and explicit about where we stand on some of these issues under investigations. We do this here and again wherever we view it is necessary. This kind of discussion of the preference and opinions of an author is reflexivity paradigm, and it is particularly important in value management issues, in which so many divergent assumptions are often left unsaid or asserted as truth. While some could argue that some issues are better left unsaid, it is not at any one interest to continue to pretend as everything is right and thus failed to present our side of the case. At least, this could serve as impetus to some writers and commentators.

Published literature revealed a wide range of opinion which tends to polarize either towards life cycle costing or value management. In other words, there are misconceptions and misunderstandings as to which of the two techniques is more involving, proactive and can ultimately create and sustain best value for construction projects. However, the purpose of life cycle costing is to maximize the total cost of ownership of the projects over the project’s life span (Morton and Jaggar, 1995 and Arditi and Messiha, 1996). It is also defined as the total cash flow of the project from the conceptual stage to the disposal stage (Bennett, 2003). Life cycle analysis takes into account the capital costs of the project as well as costs of operation and maintenance. The fundamental issue in the LCC is the determination of the operation and maintenance costs of all possible alternatives which are then discounted to present worth of money (Pasquire and Swaffield, 2006) for analysis.

However, while selecting alternative proposals or elements, the criteria of selections are more than just the issues of total costs. Many criteria, in addition to the cost criterion must be analyzed and adequately considered if maximum value is to be delivered to the client (Ahuja and Walsh, 1983). VM takes into accounts all the criteria that the client / user desire in their project. Value management involves the identification of the required functions and the selection of alternative that maximize the achievement of the functions and performance at the lowest possible total cost (Best and De-Valennce, 2003). The value management approach reduces the risk of project failure, lower cost, shorten projects schedules, improve quality, functions, performance and ensure high reliability and safety. While, life cycle costing is useful when a “project” has been “selected or defined”, value management is introduced much earlier. Value management is introduced when a decision has not been made yet either to build or not. At this stage, the “project” is still soft; the client’s solution to the client’s problem might not even be constructed facilities. For instance, if a client wants higher return for investment, value management is introduced to determine the kind of project that will provide to the client the expected return on investment (Kelly and Male, 2001). Perhaps the project in this case may be for the client to invest in agricultural activities. So from the beginning, the clients and other stakeholders are explicitly aware of the kind of project in which to invest.

This paper used literature review to achieve its aim. The remainder of the paper is organized as follows. It commences in II “epistemology of reflexivity, in this section, overview of reflexivity are presented. This section is preceded with the section on the “introduction”. Section III; dwell on the “principle of life cycle costing”. The section III reviews literature on the technique of life cycle costing. The purposes and methodology of the technique were provided and discussed. In section IV, the principle and methodology of value management were discussed. In this section, explicit references on the two important phases in the value management methodology where life cycle analysis is mainly used were outlined. Analytical comparisons of the two techniques are then presented in section V as discussion. However, before detail information on comparing the two techniques is provided, linkages between facilities management, value management and life cycle cost are provided. A basic finding from the connection is that both VM and LCC can be embedded into the wider context of FM. The paper is concluded in section VI by bringing together major themes of the paper in: “conclusion and observations”.

II. EPISTEMOLOGY OF REFLEXIVITY IN RESEARCH

Research could involve quantitative or qualitative data or both. The degree of influence the researcher has on a research depends on the type of data being collected. For instance data collected through interviews are more prone to bias as compared to survey questionnaire instrumentation. Being reflexive involves being conscious on how the researcher’s personal values, opinions, views, actions will not creep into the data collection, analysis, results and interpretations. For instance, bias could also creep into research because of how the researchers analyze and interpret previous related works-i.e. through literature review. However, bias could creep into research knowingly or unknowingly. According to Dainty, there is a “traditional of reflexivity in qualitative enquiry where researcher openly questioned the effectiveness of their research methods on the robustness of their results and debate the influence and effect that their enquiry has had on the phenomena that they have sought to observe” (Dainty, 2008). Cohen, et al., (2006) also outlined that reflection occur at every stage of action research. In that regards, in actual practice, biasness is difficult to eliminate in all type of research. However, being aware of it and the ability to control or minimize it is the most important element in research. In order to minimize biases, researchers should apply to themselves the same decisive criteria they set for other people works to pass through (Cohen, et al., 2006). However, we are consciously aware of the effects of the reflexivity on this study. In other words, we recognized the influence our sentiment, perceptions, values, feelings, thoughts and understandings may have on this study. For these reasons, we have made all possible efforts to be on the fence– yet to be decisive and analytical. In other words, as far as this issue is concerned, we have not taken a neutral position but a middle course position.

III. LIFE CYCLE COST TECHNIQUE IN CONSTRUCTION PROJECT

While information on the exact time, on the origin of LCC and the time it was first applied to the construction projects is not available, but it can be safely concluded that it preceded the VM techniques. Life cycle costing is also being referred to as whole life cost or cost-in-use. However, life cycle cost is preferred here as it is the most familiar time term even among the practitioners. Regardless of the nomenclature, the main purpose is to consider future costs in the determination of true cost of projects. In other words, LCC is a technique that is used to relate the initial cost with future based costs like running, operation, maintenance, replacement, alteration costs (Ahuja and Walsh, 1983; Morton and Jaggar, 1995; Bennett, 2003 and Kiyoyuki, et al., 2005). Elsewhere, it is defined as the total cost of project measured over a period of financial interest of the clients (Flanagan and Jewell, 2005). LCC enables a practical economic comparison of the alternatives, in terms of both the present and future costs. This is to allow in the final evaluation, to find out how much additional capital expenditure is warranted today in order to achieve future benefit over the entire life of the project. It is therefore the relationship of initial cost and other future based cost. Certainly, there is a need to relate capital cost with operation and maintenance costs in order to procure buildings that present value for money invested to the clients. This requirement is becoming more of a necessity with the increase in drive and subsequent demand for sustainable or green buildings. Since the 1960s, studies have shown there are the needs to balance capital costs against the subsequent maintenance costs of the buildings (Seeley, 1996).

Decision regarding the life cost of a project has to be ascertained right from the project’s conceptual stage as to whether to reduce the initial cost at the detriment of the maintenance and running costs. This depends on the client’s value system on the projects; however, effective balance must be strike to ensure meaningful selection. In addition to the initial construction costs which are foreseeable cost, other unforeseeable cost that should be considered are the operation cost, cost of energy usage, maintenance cost, disposal cost / salvage cost. Today clients are wiser, as they seem to prefer investing little more today for tomorrow savings. Clients are becoming knowledgeable about construction projects, as to what the future might likely portray regarding collateral costs. Issues of LCC are more important to the owner-occupier than to the developer who only builds to let or sell the construction projects on completion or over a certain period of time. In this case, end-users are left to bear the maintenance costs. The modern procurement system (i.e. design, building and operate) is possibly a good channel to consider building life cycle. In fact, the LCC is a tool that is often used by the management team to procure value for money invested

IV. VALUE MANAGEMENT IN CONSTRUCTION PROJECT

Various terms – value engineering, value control, value analysis and value engineering- have been used to describe the principle of value engineering. However, in this paper all the terms are synonymous. The most common are value management and value engineering, though. The two terms are used interchangeably in this paper. VM was developed due to shortage of materials and components that faced the manufacturing industry in the North America during the WW11. VM is both problem solving and problem seeking processes. As a problem seeking system, it identified problems that might arise in future and develop or identified solution to the problem. Value management is a proactive, problems solving management system that maximizes the functional value of a project by managing its development from concept stage to operation stage of a projects through multidisciplinary value team (Kelly and Male, 2001). It make client value system explicitly clear at the project’s conceptual stage. It seeks to obtain the best functional balance between cost, quality, reliability, safety and aesthetic. The approach could be introduced at any stage in the projects’ life cycle, but it is more beneficial if it is introduced from the pre-construction phase of the projects; before any design is committed (Ahuja and Walsh, 1983).

The tools and techniques of VM push stakeholders to provide answers to questions that might not ordinarily be considered if other approaches were used (Olanrewaju and Khairuddin, 2006). Value engineering identifies items of unnecessary costs in a project and develops alternative ways of achieving the same functions at the lowest possible cost, without impairing on the quality, aesthetic, image, safety and functional performances of the building and at the same time improves the project schedules. VM programs commonly take the form of arranging a workshop in which the client, contractors, suppliers, manufacturers, specialists and other stakeholders involved take part and put forward suggestions for discussions and investigations (Harry, 2000). This will make the consultants and designers understand what a client will accept as the benchmark to measure the outcome of their investment (Leung, Chu and Lu, 2003).

Consequently, the client will be provided with projects they can occupy, operate, maintain, at their preferred location, on schedule without compromising the require quality, function, aesthetic and images with acceptable comfort. If the client value system is not made explicit, consultants and designers merely focus on requirements that were not intended by a client. Thus, opportunity for maximizing concept, design, construction and maintenance might not be possible. However, the VM workshop or session is different from the normal project meeting as the objectives of each are distinct.

Value management is defined as an organized set of 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, taken cognizance of the client’s value system for quality, reliability, durability, conformance, durability, aesthetic, time, and cost (Olanrewaju and Khairuddin, 2007). The methodology is about being creative, innovative, and susceptible to changes, consensus, enhancing the use of resources, analytical, togetherness and good communication (Stevens, 1997). Value engineering program is commonly carried out in the systematic stages of; feasibility, concept design, design development, construction and operations and occupancy phase of the projects (Table 1). The work activities are strategically carried out in the job plan. The job plan is the frame works that guide the systematic maneuvering of ideas to ensure that alternatives are not unnecessarily omitted (Ahuja and Walsh, 1983).

Table 1.Value Management’s Job Plan

alt

The value management job plan is an organized framework that guides the processes of analyzing the project, products, services or components under study, to enable the development of numbers of viable economical and functional alternatives that meet clients’ requirements. The strict adherence to the framework ensures maximum benefits and offer greater chances for flexibility. It also ensures that no step or phase is over-sighted or omitted. The value management process can be broken down into various phases. Regardless of the number of phases in the process, the major activities still holds. In many cases, the phases are however broken down into five major phases. However, in this paper, it is broken onto nine major phases for easy understanding. Life cost of project of an item or element is mainly considered during two of the value management phases, namely, the evaluation phase and the development phase. Therefore, the next two sections will discuss in-depth the two main phase.

IV.1 The evaluation phase

This is the fifth phase in the value management methodologies. The evaluation phase is some time call the investigation phase. The evaluation phase is very important phase of the value management process. It is a strategic planning stage of the process (Stevens, 1997). The phase should be considered with the spirit of creative thinking that is associated with the analytical phase. The refined and modified results of the analytical phase are considered in detailed in evaluation phase, on one to one basis judging among themselves. Primarily, the basic activities of this phase is elimination, pruning, modifying and combining ideas in order to reduce the large quantity of ideas collected from the analytical stage to meaningful and workable ones. Generally, alternatives are evaluated in terms of its total cost, availability, technology, its merits, its constraints, ease of construction, effect on schedules of works, safety, ease of procurement, coordination (Bennett, 2003). The evaluation should not just be based on what similar design had cost before or currently cost, but the comparison should include physical appearance, similar properties, and methods of designs, technology and maintainability (Ahuj and Walsh, 1983).

In the course of pruning ideas, some ideas might appear to have potentials but perhaps due to the prevalent technological advancement, they might not be considered. Those ideas should be put aside for later discussions with interested manufacturers or vendors for productions or purchase (Dell’Isola, 1982) where possible. Overall, the project must be looked at from different dimensions. In order to avoid fall-out during the evaluating process, a benchmark should be set against which to establish and measure whether idea should be rejected, pruned, modified or combined. However, it is important to invite some if not all members of the designing team in order to listen to their opinion regarding the evaluated alternatives, particularly, those that were selected. This is important in case they might have considered inculcating some of the analyzed alternatives earlier on. And, if they had, a request should be made as to why they did not consider using these alternatives. Their ground of rejection might be important to the study team (Kelly and Male, 2001) in search for better alternatives.

IV.II: The development phase

Based on the outcome of the evaluation phase, some or the entire item will require further development so that best value proposal can be made more explicit. In other words, the purpose of this phase is to enable further development of the alternative proposals. The major activity that is performed in the development phase includes the preparation of alternative design and cost so that a justification can be made on the viability and feasibility of the new proposals (Dell’Isola, 1982; Ahuja & Walsh, 1983 and Ashworth, and Hogg, 2002). Further benchmarking is to be considered here aside the one in the preceding phase such as; if the idea will work and meet the client’s requirements considering the prevalent advancement of technology. In addition, the interests of the clients who will approve the recommendations require systematic consideration to avoid unnecessary objections. All the relevant information regarding the development of a project must be documented, as this will later be presented to the clients as evidence. The associated risk inherent in the alternative proposals are determined, documented and solutions proffer in advance (James, 1994).

V. DISCUSSION

This section discusses the crossing point between value management and life cycle cost. But before proceeding, a brief discussion on how the two strategies relate with facility management is provided. The question can be asked, whether LCC or VM fit with facility management? Facilities include all fixed properties of an organization such as buildings, plants and equipments. Assets entail both fixed and non-fixed properties of an organisation. Facilities contribute significantly to the enhancement in productivities, profit-abilities and service quality of an organization. Facility management (FM) involves the management of all the services that support core business of an organization (Amaratunga, et al., 2000). FM focuses on meeting organization’s performance in terms of relationship between operational facilities and business outcome. Although, both VM or/ LCC are applicable to all classes of facilities (management), the focus of the classes of the facilities that this paper is concerned with are the constructed facilities and the building projects in particular. Building in this context involve the building’s fabrics, structure and engineering services. The value of a building is determined in relation to its current ability to provide user functional requirements, the current market value and the building condition and performance rating in comparison to that of a new building (Kyle, 2001). The roles are consistent with functions of professional including value managers, asset managers, facility managers and the real estate managers.

One of the major functions of facility management is to ensure that building projects receive adequate maintenance in order to continue to function efficiently and effectively to support the organisation’s corporate objectives. Maintenance process is a fundamental stage in the building life cycle. Maintenance has to be initiated if the building is still functionally sound and cost-efficient to do so against procuring new building or embarking on activities including refurbishment, conversion and alteration. In order to ensure high building performance, maintenance must be considered from the initiation of the buildings. From the foregoing, the opening question is pertinent, because LCC is a technique that is used by the facility management organisation or team to procure value for money invested (Flanagan and Jewell, 2005). In other words, LCC enables facility managers to make informed decisions on how much to invest today for future economic benefits. While the needs for space requirements in an organisation can be triggered by organisation’s asset / facility management unit, the strategic nature of VM allows it to be explicitly clear whether the proposed facility is require and what nature and form it should takes. Generally, the primary functions of the facility managers concern the coordination of the needs of properties users, equipments and plants and operational activities taken place within the space (IREM, 2006). This role is different from that of the value managers. The feedback from the post occupancy evaluation, which forms part of the FM directive, can also serve as feedback to the VM workshop in order to provide best values to the stakeholders. In general, VM can be integrated into the largest context of FM (Green and Moss, 1998) as FM provides a wider platform for decision making throughout the building life cycle. Therefore, FM focuses on space planning. Thus, the combination of VM and FM would produce good outputs. Having provided connections between facility management, life cycle costing and value management, in the remaining paragraphs the discussion emphasises LCC and VM.

Issues relating to LCC of facility have received wider acceptance, because what appears to be cheaper might in actual fact be expensive taking into account future-based costs. Therefore, when selecting a design solution capable of achieving the client value system, alternative that has the lowest cost, will in most cases be the first to be selected, if other performance criteria are satisfied. However, criteria like aesthetic (inspiring and harmonious), images (reputable and progressive), fitness for purpose, sustainability, buildablity, maintainability, technology, quality, safety, convenience, comfort, reliability must be included if best value is to be achieved. Construction clients are becoming more demanding, complex, sophisticated and in fact wiser compare to how they use to be in the past. Today’s clients want to see and in fact have projects that will perform the required functions; that costs less, be sustainable, completed within shortest possible time and also meet other basic requirements (Fong, 1999). Whereas, life cycle costing concentrate on the cost criteria (capital, operation and maintenance cost though), value management takes account all of the criteria within the client value system. Indeed, today clients are taking into account various set of complex algorithm that defined value to them (Halil, and Celik, 1999). The benefits and satisfactions they are getting from other industries like the automobile, aircraft industries are all fascinating experience. These are also making them to be more aggressive with the construction industry. The LCC techniques might be capable of providing best price, but best price does not in any way connote best value.

LCC is introduced after it has been decided that the best alternative proposals that will meet the client’s corporate objective is construction project, whereas VM examine the client’s business case to establish what type of “projects” a client required. Project in this stage is not necessarily a construction projects, but any alternatives that would provide the best return for the client’s investment in terms of money, time and other criteria of their value system.

VM precedes other strategies in that it is introduced before the design even commences (Kelly and Male, 2001; (Qipping, and Liu, 2004 and Shen, 2004). It is also unique in that it makes explicitly the client value system and goes ahead to determine weather the projects is desirable, viable and feasible before any commitment is made to whether to build or not. In that regards, it entail getting it right from the concept. It is only when the correct problem is identified that the correct solution can be developed. Regardless of the sophistication of the instrument used, if the client’s needs and wants are not known, it is either the projects is abandoned, completed but unoccupied or very expensive to operate and maintain. While LCC is tactical; VM is both strategic and systemic. While the LCC could be described as a strategy that provides answer to the question “how do we do it efficiently”, VM ask and provide answer to the question “why do we do it-why do we need the projects”. This is achieved using the functional analytical procedure of the VM. VM is certainly not a replacement alternative to the previous cost saving approach but it is certainly a viable alternative for achieving client value system (Ahuja and Walsh, 1983).

In the value management of construction projects, techniques like the supply chain, risk management, procurement, system engineering, concurrent engineering, safety management and partnering are applied during the development stage of the VM workshop; when developing alternative proposals, elements, components, equipments, items, materials and construction methods that provide value for money to the client. Therefore, these techniques are tools in the kits of the value management process. Apart from the LCC technique, VM makes used of other tools and techniques including, functional analysis, decision matrix, criteria scoring, brainstorming and functional cost model, SWOT analysis, supply chain analysis, risk analysis and checklists. To underscore the holistic and uniqueness of value management, various writers including Male, et al., (1998) and Fong (2004) have found that value management is more involving and unique than many methods / systems including total quality management, supply chain management, risk management, time management, cost management and lean construction.

VI: CONCLUSION AND OBSERVATIONS

The study has been able to investigate the relationship between value management and life cycle costing through literature review. This is done by bringing the theory behind each of the concept into context through literature survey. The paper has revisited the debate on VM and LCC which began sometime ago perhaps unnoticed. While the exact time cannot be traced the debate probably began on the arrival of the VM into the construction scene around 1960. This paper should be regarded as reflective contributions of the authors to the debate about the two concepts and tools. Life cycle costing technique is specific to particular stages and it is useful when it has been established that a “project” will satisfied the client requirements. The techniques and tools used in VM are not new per se, however the methodologies, consistent, systematic and holistic ways they are applied in VM is prominent. While value management has reached certain level of popularity and maturity, the LCC is yet to gain similar recognition even in the construction.

In conclusion, hopefully, we have been able to provide intermediate interpretations of the two concepts because we do not intend to provide extreme viewpoints. This paper does not claim that total cost of building is not important, but what it claimed is that, the value of projects does not ends with the consideration of the cost alone. Many “soft or qualitative” issues in actual fact are more important to the “hard or engineering” issues in majority or all of the cases. Perhaps, we should also add that considerations of the quality and completion time of project are also engineering or hard issues. Our aim is to provide a broad overview over a significant, yet complex issue and the emphasis has been to demonstrate the connection between the two concepts. Since we are aware of the bias that might creep into research like, attempts were made consciously to bring them to the barest level even though it is very difficult to eliminate it altogether. The conclusions of this paper are based on literature review In future primary data through survey or case studies will be collected from those that are consider to have adequate knowledge on the two techniques to see how our opinions differ from that of others’. On a final note, VM is about getting the initial concept right from the word “go”!

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Sustainability of DOD Buildings – Reuse of Existing Buildings

Reusing existing buildings achieves a 15%+ higher return on investment and 20% reduction in greenhouse gases.   It is less  costly and more sustainable to reuse existing buildings.

With 345,000 buildings, with over 105,000 buildings more than 50 years old, the importance of efficient renovation, repair, and sustainability of existing buildings is paramount.

DoD Building Treatment Terms
•“Adaptive reuse & rehabilitation” are terms of art outside DoD
•The DoD term for “major rehabilitation” is “modernization”
•Modernization means: “the alteration or replacement of facilities solely to implement new or higher standards to accommodate new functions or to replace a building component that typically lasts more than 50 years.”
•This study compares the costs and GHG of modernization with new construction

Sustainment/Status Quo
•Formulated for measuring baseline energy consumption
Demolition and New Construction
•LEED Silver certifiable construction – 2009 LEED for New Construction and Major Renovations
Full Modernization with Strict Application of Historic Preservation Standards (HPS)
•Full modernization with a strict application of Historic Preservation Standards ( HPS) and other DoD facility design standards
•LEED Silver
Full Modernization with Strict Application of AT/FP
•Full rehabilitation/modernization but with strict application of Anti-terrorism/ Force Protection requirements through building hardening, seismic and other DoD facility design standards
•LEED Silver

Applicable design standards include:

  • Whole Building Design
  • UFC 1-200-01 General Building Requirements
  • UFC 4-610-01 Administrative Facilities
  • UFC 1-900-01 Selection of Methods for the Reduction, Reuse and Recycling of Demolition Waste
  • UFC 3-310-04 Seismic Design for Buildings
  • DoD Minimum Antiterrorism Force Protection Standards for Buildings
  • Secretary of Interior’s Standards for Rehabilitation of Historic Buildings

Findings

  • DoD’s Pre-War masonry buildings are an underutilized resource for meeting DoD GHG carbon reduction goals
  • ATFP and Progressive Collapse requirements tend to be rigidly and prescriptively applied, raising construction costs and introducing additional Scope 3 GHG emissions
  • Prior modernization treatments result in loss of original energy saving design features in Pre-War Buildings
  • Differences in GHG in alternatives resulted from the amount of new building materials introduced and transportation of demolition debris
  • Cost estimates and construction bid requests should include materials quantities in addition to costs to evaluate and validate GHG impacts.
  • Design professionals with practical experience with archaic building materials and systems are critical to the development of accurate planning level specifications
  • GHG emission tradeoffs of proposed new materials and building options should be evaluated early in the conceptual design process

Recommendations

  • Incorporate life-cycle GHG emissions analysis into DoD MILCON and SRM programs
  • Invest in formulation of carbon calculator system
  • Place more emphasis on existing buildings as viable project alternatives to meet mission requirements
  • Identify characteristic strengths and vulnerabilities by class of building
    Place more emphasis on existing buildings to meet DoD energy reduction goals
  • Avoid modernization treatments that result in loss of original energy saving design features in Pre-War Buildings

Green House Gas - Benefits of Building Re-use vs. New Construction

Efficient project delivery methods are of critical importance to the task of sustainability and life-cycle management of the built environment.   Job Order Contracting ( JOC ), and SABER are proven project delivery methods for renovation, repair, sustainability, and minor new construction.  JOC and SABER are a form of Integrated Project Delivery for existing buildings and infrastructure.

JOC and SABER provide the following advantages to building portfolio Owners:

•Fast and timely delivery of projects.
•Consolidation of procurement – lower overhead cost and procurement cost.
•Contractor and owner efficiencies in prosecution of the work.  Development of a partner relationship based on work performance.
•Virtual elimination of legal disputes, claims and mitigation of change orders.
•Standard pricing and specification utilizing a published unit price book (UPB), typcially RSMeans-based, resulting in efficient and effective estimating, design, and fixed price construction.
A bit more about JOC –
  1. “IPD Lite” for Existing Buildings.
  2. Consolidates procurement to shorten Project Timelines and reduce procurement costs.
  3. Transparency of pricing and procurement compliance through Unit Price Book.  Owner creates internal estimating (IGE)
  4. Long Term Facility Relationship increases productivity and enables reiterative process improvements.
  5. Quality and performance incentivized through IDIQ form of contract with minimal guarantee and clear maximum volume.

Traditional Project Delivery vs. Integrated Project Delivery

via.www.4Clicks.com – Premier cost estimating and efficient project delivery software and services for JOC, SABER, SATOC, IDIQ, MATOC, MACC, POCA, and BOA.  Featurings:

  • Exclusive 400,000 line item enhancement of RSMeans Cost Data
  • Automated Technical Evaluations
  • Contract, Project, Estimating, Document Management
  • Visual Estimating

TCO - Green House Gas

Legal and Policy Framework
•National Historic Preservation Act of 1966 ( Amended)
•Energy Policy Act of 2005
•Energy Independence and Security Act of 2007
•Executive Order 13423: Federal Environment, Energy, and Transportation Management (2007)
•Executive Order 13514: Federal Leadership in Environment, Energy, Economic Performance (2009)

AGC – Job Order Contracting Webinar – March 12, 2013

Webinar:   Job Order Contracting

Tuesday, March 12, 2013 – 2:00pm to 3:30pmJOC Process

Job Order Contracting (JOC) is an innovative delivery method focused on the renovation and repair of large facility infrastructure under a long-term contract.   JOC has been around for a long time but is experiencing an upswing in an era of limited capital dollars and greater efficiency.   Like IPD, JOC focuses on relational contracting, an integrated team, and performance incentives, but JOC is unique in its unit-price structure and repetitive delivery order process.  This webinar will demystify unit pricing, coefficient development, job order scoping and estimating process, and skillsets needed to succeed in JOC. The current JOC market will be framed, with an emphasis on serving owners throughout the building life-cycle.

During this webinar, participants will learn about:

  • Compare Job Order Contracting (JOC) to other well-known delivery methods.
  • Describe the pricing structure of JOC, identify strategies for developing a coefficient, and understand the basics of line item estimating.
  • Discuss the JOC delivery order process, including scoping, proposal preparation, and execution.
  • Identify current JOC market opportunities and dynamics, including market segments, contract structure, unit price books, consultants, etc.
  • Determine skillsets and culture to be a successful JOC contractor..

Speakers

Lisa Cooley
Consultant, LEED AP

Perfecto Solis
Vice-President of Airport Development and Engineering, DFW Airport

Leo Wright
Vice-President of Job Order Contracting Division, F.H. Paschen

 

 


Any questions or changes to your registration should be made via email to meetings@agc.org.

via http://www.4Clicks.com – Premier Cost Estimating and Efficient Project Delivery Technology for JOC, SABER, IDIQ, IPD, SATOC, MATOC, POCA, BOA.