by Aaron T. Hansz
I heard a story where an architectural and engineering firm was in the middle of a presentation to a potential client and the CEO got up and said, “If it weren't for the weather, we wouldn't need a building…we only need to keep the weather off of our tools.”
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Today, the environment that our tools sit in is just as important as the tools themselves. Yet, every day I meet with senior management, facility managers and end users that hold onto that mode of thinking. Time and time again I see organizations pick the low bidder strictly because of price and not because of quality or services offered. When sitting on a selection committee, be aware of how the proposed bid relates to the quality and operation of the proposed facility changes.
Those are the projects that go over budget and way off schedule; the ones where the product that was intended to hit the market gets pushed back six months to a year resulting in hundreds of thousands, if not millions of dollars in lost revenue for the company.
There are methods, thinking processes, that can help alleviate these headaches and massive losses to your bottom line. The key is choosing the one that is most relevant to your project.
All facility projects, from small retrofits to large greenfields have common characteristics. The common denominators are that the facility must be designed, put to paper and constructed. There are many different ways to contract these services—three of the most common are plan and spec, design/build and design construction management (CM). The main differences among these options are the contractual set ups between owner and project members, as well as the communication structure of the project. However, the goal is to design the facility and then build it.
In years past, the traditional way of doing this has been to plan and spec or design/bid/build. This occurs when an owner hires architects and engineers to design the facility and the project goes out for bidding to construction companies to put a price on the building construction.
In the last twenty or thirty years, we've seen other forms of the process emerge such as design/build and design/CM where the owner can go to one company for total “turnkey” or management services. Momentum is shifting toward an approach that offers single-source responsibility. This gives the owner one point of contact for communication and decision making.
There's much to say for all three methods; however, that's a two-day seminar and it would take an entire book to explore all three options sufficiently. In an attempt to simplify choices and options, go back to the statement, “If it was not for the weather, we would not need a building.” Owners do need buildings and those buildings need to be feasible, flexible and safe.
Budget is typically the largest and most watched part of a project. Usually in a plan-and-spec project, the design team will get feedback from upper management, facility management and end users. The team will then compile the information and start designing.
As designers, they'll put together a budget after they've completed the design to a certain level. If the budget number is too large, they'll go back to designing and try to bring the design back to an acceptable budget level and go through a bidding process until a contractor is awarded the project. Most of the time there will be design issues that will have to be re-evaluated and re-designed. In this scenario, value engineering is an additional step in the process, adding cost and time to the schedule.
This back-and-forth process is expensive and time consuming and can be avoided by bringing in a contractor with a team of architects and engineers.
The first suggestion to overcome this volley would be to get rid of all the marketing titles. Don't get caught up with different terminology to the point that your facility will suffer. Create a team that consists of appropriate members from your own staff—architects, engineers and a contractor. Bring them all on board to the project at the same time and their involvement and contribution will save the project time and money. You've heard it before and you'll hear it again—choosing a complete team is the most important part of your project.
Another suggested point is to start off with a projected cost that's in line with your business model. I've heard that cost cannot be determined until a level of design has been achieved. This is true in some situations; however, an organization can determine with ease the amount it can afford and apply that amount to a project. With the right team, cost can be identified early and options can be weighed before substantial design starts.
The process of determining the cost of a facility up front will force value engineering to be a consistent dimension in the project and will turn budgets into more detailed and specific estimates.
If you start with a price for the facility, the project will be relieved of re-design. Another valuable point is that as the design phase continues, options will become a by-product. In this scenario, the decision to act upon an option is based on wants rather than needs.
In a typical design process, options are most likely to be taken as a reduction in scope to reduce the cost of the facility. In the scenario where cost is the predetermining factor, an addition may be taken not out of a need to rescue cost, but a desire to improve the facility. In many cases, an appropriate reduction will not even be seen and will be unable to be realized.
If the end cost drives design, chances are that reduction has already been incorporated into the design—leaving funds for a more valuable addition. In this case, your facility will be more feasible and flexible than previously conceived.
In the end, don't get caught up in all the terminology. Start with a firm cost for the facility, choose the team that is right for your project and be sure to include all the team members from the design and construction sides as well as your staff.
Aaron Hansz handles technical sales and marketing for Luwa Lepco Advanced Technology Facilities and is a frequent presenter at CleanRooms Group conferences. Contact: [email protected].