lean contracting practices without an ipd contract and the ... · escalation addressed in: ... •...
TRANSCRIPT
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1 www.consensusdocs.org | [email protected] | 866.925.DOCS (3627)1
Joel DarringtonContracting CounselDPR [email protected]
Brian PerlbergExecutive Director [email protected]
Tom RichertPrincipal Lean Project Consulting, [email protected]
Lean Contracting Practices without an IPD Contract and the New ConsensusDocs 305 Lean Construction Addendum
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ConsensusDocs 12+ Years
$1,000,000+ In donated free educational licenses.
12Years publishes best practice contracts
100+ Standard contract documents.
40Leading construction associations participating in the Coalition.
3,000+Subscribers.
1 GoalImprove the design and construction industry with Best Practice Contracts
$40+ Billion in Construction Contracts
ZERO Reported Cases
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What is the ConsensusDocs 305?
Owner/Design
ProfessionalContract
CD 305 Lean
ConstructionAddendum
Owner/Constructor
Contract
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Ways to Contract for Lean Design + Construction
• Integrated Project Delivery (IPD) Agreement (a/k/a IFOA)• e.g., CD 300 (2016 edition)
• Custom-created IPD-ish design & construction agreements• Vague references to Lean added to an owner’s standard
contract• Now with CD305, an industry standard form outside of IPD
that addresses a wide spectrum of Lean practices
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Addendum to What?
ConsensusDocs 305 can be used with:• ConsensusDocs 500 Agreement between Owner & CM• Other forms of CM at Risk contracts• Construction contracts under Design-Bid-Build• Owner contracts with Design Professional
• Not intended for Design-Build Prime Contracts, but … • ConsensusDocs 341 will be published this summer.
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How is this Different than IPD?
Owner
CM/GC
Key Trades
Key Design Consultants
IPD
Owner
CM/GC
Design Prof.
Sub-contractors
CD 305
Specialty Designers
CD305
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DesignProf.
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Addendum vs. Silence
• Increase alignment among parties• First collaborative act• Parameters for Lean behavior and activities• Some Lean methods will conflict with standard contract
language, so Addendum overrides • Allows enforcement of Lean requirements, but take care
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Using the CD 305
• When? • O/A/C are committed to Lean, but one or more are not
ready or able to enter an IPD Agreement• As early in the Project as the Owner will allow
• How?• Jointly negotiated, separately attached• Check-the-box
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Typical Chronology of IPD Project
Allowable Cost
Preconstruction Phase Construction Phase
Expected Cost & Target Cost
Contract PriceActual Cost
Validation Phase
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CD305 Check-the-Box Example 1
Preconstruction Phase
Construction Phase
Validation Phase
Joint Worksite Investigation (6.1)
Evaluate Owner’s Program (6.2)
Validation Study (6.3)
Continuous Cost Modeling (6.4)
Integrated Design/Target Value Design (6.5)
Risk Identification/Management (6.6)
(Always included; no check boxes)
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CD305 Check-the-Box Example 2
Preconstruction Phase
Construction Phase
Validation Phase
Joint Worksite Investigation (6.1)
Evaluate Owner’s Program (6.2)
Validation Study (6.3)
Continuous Cost Modeling (6.4)
Integrated Design/Target Value Design (6.5)
Risk Identification/Management (6.6)
(Always included; no check boxes)
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CD305 Check-the-Box Example 3
Preconstruction Phase
Construction Phase
Validation Phase
Joint Worksite Investigation (6.1)
Evaluate Owner’s Program (6.2)
Validation Study (6.3)
Continuous Cost Modeling (6.4)
Integrated Design/Target Value Design (6.5)
Risk Identification/Management (6.6)
(Always included; no check boxes)
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What about Incentives?
• CD305 does not itself provide for incentive compensation
• Too much variability to standardize incentives
• CD305 does provide for Performance Improvement Program, which individual projects could use as a platform for incentive compensation
• Provide for incentives through amendment to Owner contracts
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Reliable Promises 3.3
• Conditions of satisfaction must be clear
• Competent to perform
• Time estimated and reserved
• Performer sincere
• Performer accepts consequences
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• Owner, Design Professional, and Constructor Reps, plus others invited
• Resolves problems through consensus decisions and best interests of the project
• Selects team• Provides daily leadership for the project• Manages budget and design process• Implements production control• Oversees personnel and team members.
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Core Group Owner, Design Professional, Constructor
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• Candor and thick skin
• Enthusiasm for change and improvement
• Commitment to goals and principles
• Ability to decide and commit
• No hierarchy
• Shared accountability and responsibility.
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Core Group - Key Attributes
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• 15 performance metrics
• Periodic evaluations
• A focus on team members’ behaviors
• Clear standards for evaluating performance
• Feedback mechanism on improvements.
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Performance Improvement Program
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• Aligning Personal, Team and Project Goals
• Focus on Clarity of Requests and Commitments
• Coaching
• Equip the Team for Rapid Learning
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Implementing Team Leadership & Culture
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Aligning Personal, Team and Project Goals
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Focus on Clarity of Requests and Commitments
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Where you are.
Where you want to be.
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Equip the Team for Rapid Learning
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• Section 5.1• What is a Project Planning System• Weekly Planning Cycle• Daily Adjustments• Implied Practices
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Project Planning System
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Source: Ballard, Tommelein. 2016 Benchmark for the Last Planner System®
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What is a Project Planning System
®
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Allowable Cost
Expected Cost & Target Cost
Validation PhaseJoint Worksite Investigation (6.1)
Evaluate Owner’s Program (6.2)
Validation Study (6.3)
Program Services & Validation
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Preconstruction Phase
Expected Cost & Target Cost
Continuous Cost Modeling (6.4)
Integrated Design/Target Value Design (6.5)
Risk Identification/Management (6.6)
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Integrated Design & TVD
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Preconstruction Phase: Constructor to:• Provide continuous cost modeling and analysis• Generate periodic cost model reports
Construction Phase: Constructor + Subcontractors to:• Provide cost information and estimates requested by Core Group
Core Group to:• Establish milestones for updating Project cost model• Direct actions if cost model exceeds Allowable Cost
Compare to lower design-assist option in CD 541.
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Continuous Cost Modeling
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• Collaborative – DP still in charge and responsible, but must coord. + integrate with Team
• Value, Cost and Schedule and constructability are basic components of design (6.5.1)
• Written Protocols for Target costs [6.5.7.3 (a-h)]
• Add value w/ VAPs, TVD Clusters, A-3s (6.5.8)
• Design phases – planning/programming, design, detailing,
and production planning
• Uses pull based design process to drive innovation
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Target Value Design
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Document Review
• Examine Design Documents with reasonable care
• Advise Core Group of issues prompting additional contingency
• Suggest options for additional investigation
Target Value Pricing 6.5.7
• Establish Expected Cost and Target Cost early
• Target Cost only exceeded by express approval of Core Group.
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Target Value Design Processes
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Continuing refinement of cost models
Cost analysis not to be deferred• Byproduct of continuing TVD process• Core Group jointly manages
Escalation addressed in:• Estimates• Expected Cost• Target CostExpected Cost and Target Cost adjusted• At Final Completion• Reflecting difference between escalation allowance and actual escalation
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Target Value Pricing
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• BIM (verb) as a process not a software application
• Interconnected models and databases
• The power of BIM makes the payoff of lean greater –Provide continuous, immediate, and
reliable informationRegarding design, scope, schedule,
and cost.
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Building Information Modeling (B.I.M.)
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Design Model As-Built
Design Model Vs As-Built
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Design As-Built
Des
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• Identify material risks in early workshops
• Create risk identification report• Rank and focus on higher priority risksLikelihood of occurrenceTime and cost impacts
• Develop Risk Management Plan withContingency plansAssignment of primary responsibilityAddress roles of others in managing risk
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Risk Assessment and Management 6.6
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Article 7
• 5S Plan• Quality, Standardized Work, PDCA• Material Flow• Information Flow
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Construction Phase Lean Features
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5S Plan
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Sort Set in Order Shine/Sweep
Standardize Sustain
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Quality, Standardized Work, PDCA
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Material Flow
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ConsensusDocs 541 Design Assist Addendum• Addendum to prime agreements, consultant and subs• Optional tools from CD 305:
• BIM• Owner’s program evaluation• Value Analysis• Cost modeling• Optional risk analysis• Optional production planning
• Constructability (in 541 only) • Manpower analysis, design-build packages early
procurement packages, etc. (in 541 only) • Design Coordination (in 541 only).
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How do you Structure the ConsensusDocs 305 & 541?
Owner
Constructor
Key Trades
Key Design Consultants
DesignProf.
IPDCD 300
Owner
CM/GCDesign
Prof
Sub-contractors
CD 305CD 541
Specialty Designers
CD305
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CD 541or both
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TheCollabometer
DesignAssist
“Collabometer” Courtesy of Jack Mumma Michigan State University
45
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Design-Assist can help Prevent Against
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Joel DarringtonContracting CounselDPR [email protected]
Brian PerlbergExecutive Director [email protected]
Tom RichertPrincipal Lean [email protected]
Lean Contracting w/o IPD & the New ConsensusDocs 305Download a sample by registering at www.consensusdocs.org.
Questions?