Thursday, December 18, 2014

Presentation on Forensic BIM for the NAHB




In January I will be presenting at the National Association of Home Builders International Builder's Show in Las Vegas.  The presentation, titled Forensic BIM, explores the scope and nature of the legal duties owed by built industry professionals and manufacturers in a BIM environment.

BIM as the new standard of care for designers is not a new concept. In fact I was quoted on the topic in an article published by For Construction Pros in 2011 titled, BIM Emerging as the New Standard of Care.  As I explained in the article at the time I had remained silent on the topic for sometime out of a sense of loyalty / duty to my design clients.

Now however, the cat is out of the bag and creative lawyers will soon seek to hold other built industry professionals, like planners, general contractors, trade contractors and certain specialists to a heightened duty as the use of BIM expands.  In addition, the new standard of care will likely extend to manufacturers as well.

In light of the foregoing I argue a good offense is the best defense and I prepare my clients to utilize BIM effectively and to reduce the risks to themselves and their clients.


 

Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















CPM Conference in San Diego




I will be presenting at the 5th Annual CPM Conference in San Diego in January on two topics. The first presentation provides a jaded construction lawyer's perspective on the cultural and legal implications of BIM and IPD for Construction Project Management and the second is actually a short Katy's Castle Workshop.

Both events are on Saturday, January 17, 2015.  The presentation is from 1:15 p.m. to 2:30 p.m. and the workshop is from 2:45 p.m. to 4:00 p.m.

Below are abstracts introducing the presentation and the workshop.

What are the legal and cultural impacts of BIM and IPD on CPM?

The industry wastes 40% to 60% of the labor, materials and time invested in capital projects; that’s a problem.  Integrated teams capable of deploying better planning, design and construction processes can cut that waste in half; that’s a solution.  Creating a legal framework that supports and enables planning, design and construction in a trust based environment; that’s a strategy.  Creating a smart built culture on your next project; that leads to success.  Join James L. Salmon, Esq. of Collaborative Construction to learn how BIM and IPD are impacting our industry’s fragmented, adversarial and paranoid culture and how construction professionals can created a smart built culture that is integrated, collaborative and cooperative and reduces waste and inefficiency.

 Building Katy’s Castle: A Broken Built Culture Versus A Smart Built Culture   
   
The broken culture pursuant to which capital projects are planned, procured, designed, constructed and ultimately operated and maintained must be repaired.  That broken culture is fragmented, adversarial and paranoid.  It must be replaced with a smart built culture that is integrated, collaborative and cooperative.  Building Katy’s Castle exposes broken features of the current culture and highlights the benefits of a smart built culture that is integrated, collaborative and cooperative.  Join James L. Salmon, Esq. of Collaborative Construction for an opportunity to build Katy’s Castle live.

Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Tuesday, December 16, 2014

Is our built industry culture (STUPID)X?





Is the built industry infected with an incurable case of stupid?

Sometimes I wonder.

Do you?


Hear's a link to an older post that details the Return on Failure and expands on the concept of a Stupid Culture.

Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Defective Business & Delivery Models in Construction




In the article excerpted and linked below Mark Wakeford, the Managing Director of Stepnell, Ltd out of the UK comments on the dangerous nature of the "cash generation" and "hibernation" business models prevalent in the construction industry.  Mark's insightful analysis deserves the attention of advocates of BIM and IPD as he lays bare the dangers associated with running an entire enterprise through the OPX side of the books and neglecting targeted CAPX investments.

OPX is short hand for operating expense and CAPX, of course, refers to capital expense.  Construction companies are notorious for running expenses through operations and neglecting capital investments.  Mark's article describe the bumpy ride associated with the "cash generation" model during a boom and the "hibernation" during a bust.

Mark describes the intersection of these two models as follows:

This hibernation model, coupled with the cash generating model for contracting, explains a number of pressures that contractors are facing as we emerge from recession. A long hibernation period, as we have faced since 2009, means that companies have used more of their financial resources than they may have anticipated during the recession. As a result these companies have less funds and they now need to win work to generate the cash required to support their businesses. One result is that competitive tenders remain highly competitive at a time when input prices are rapidly increasing.
 
Here's a link to Mark's article titled, A Dangerous Business Model.

While Mark's article accurately describes certain deficiencies in the alternating "cash generation / hibernation" business models his solution is simply a gentle reminder of the need to diversify revenue streams, primarily through owning income generating properties.  Specifically, Mark says:

If this construction business model is unsuitable for this phase of the economic cycle then what is appropriate? Clearly a business that generates a return during a recession is more robust as it can invest and prepare for an improving market. Historically, contractors used to hold significant property interests that provided both an income during recession and assets to support a growing turnover post-recession. Other models exist, but this is the one that Stepnell follows as our historic property interests support our construction activities.

Not every enterprise that delivers services in the construction industry has the ability to invest in real property that generates income during an economic downturn.  Large well managed construction firms with deep pockets may have that luxury, but not the vast majority of the stakeholders in the industry. In fact, more than 98% of the business entities that deliver planning, design and construction services in the United States have 50 or fewer employees.  Similar numbers are seen in Europe, Asia and Australia. However, the fact that most in the industry lack the resources to successfully execute the hibernation half of the "cash generation / hibernation" business models takes nothing away from Mark's criticism of those models.

Lack of liquidity and access to capital reinforces, rather than detracts from, the argument Mark is making.  So what's the key problem?  How do we solve that problem? And where, strategically  does the industry go from here?

The built industry's problem is a waste rate of 50% to 60% on capital projects, manifested by the Fifty (5) Years of Failure to improve labor productivity in the industry. 

The solution to that is to form, deploy and utilize integrated teams capable of better planning, design and construction processes in a trust based environment.  In construction this is known as integrated project delivery or IPD

The best strategy is to creating a smart built culture that supports and enables the formation, deployment and utilization of integrated teams in a trust based environment.

In addition to reliance on the inefficient business models of "cash generation / hibernation" the industry relies on a  defective delivery model, design, bid build & its economic spawn, profits extracted from waste.  That defective delivery model exacerbates the pain inflicted by the defective business models Mark described. While even a flat worm turns away from pain, not the construction industry. We wallow in the misery. Smart collaborative delivery models, like integrated project delivery, where profits are earned by adding value mitigate the risks better and built industry players that want to survive in the emerging knowledge economy will adopt, adapt to and deploy smart built cultures.


Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Friday, December 12, 2014

Esoteric Philosophy in the Built Industry




Ancient philosophers wrote in an esoteric style because telling the plain unvarnished truth could get them killed. Below are excerpts from and a link to Paul Cantor's review of Arthur Metzler's Philosophy Between the Lines. Cantor argues that Metzer's insights into esoteric writing help explain modern culture too.

In the passage below Cantor explains the rationale underlying the use of an esoteric writing style by philosophers.

Imagine, then, the plight of philosophers who commit their dangerous thoughts to writing and thereby threaten to publicize their disagreements with the political and religious establishments. Philosophers had to learn an art of writing that would enable them at one and the same time to conceal and reveal their thoughts—to conceal their unorthodox ideas from a potentially hostile public and yet reveal them to like-minded, potential philosophers whom they wished to develop as students. The result was the famous “double doctrine of the ancient philosophers.” They learned to write in such a way that their works had an exoteric and an esoteric meaning, a conventional meaning on the surface that would placate would-be censors and persecutors, and an unconventional meaning tucked away between the lines, which careful readers could figure out by paying attention to various anomalies in the text.

Next he expands on the value of understanding the impact of these esoteric ploys on modern culture.

In short, Melzer shows how much is at stake in the subject of esoteric writing: no less than the issue of the freedom of the human intellect. By losing sight of esotericism, modern thinkers have radically changed their conception of philosophy and have come to question its original claim to be the search for true knowledge as opposed to the limited opinions of particular political communities. In the terms of Plato’s Republic, contemporary thinkers deny that the philosopher can ever ascend from the intellectual cave constituted by the city. In his most significant contribution, Melzer argues persuasively against this view, insisting that only an understanding of the use of esoteric writing in earlier philosophers can alert us to a perennial human potentiality: freedom of thought. In Melzer’s view, grasping the importance of esoteric writing is a liberating and inspiring experience: 
The whole course of Western philosophical thought is not so well-known and settled as we have long thought it to be. Beneath its conventional exterior, it is more daring, original, and alive.
Individuals and entities walking the tight rope of politically correctness may find value in the use of esoteric writing, marketing and news releases that assuage the high priests of politically correct thought while delving into critically important matters beneath the surface.  I see many in the built industry utilizing esoteric language to mollify green activists while delivering more valuable analysis to those willing to dig a little deeper.

It's interesting how everything old is eventually new again.



Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Wednesday, December 10, 2014

Oil & Gas Prices Fall ... How will OPEC react?




And how will lower prices impact the Oil & Gas market in North America, Australia and Europe?

Some insights in this article, Bank of America Sees $50 a Barrel Oil.
 

Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Monday, December 8, 2014

Measuring Labor Productivity in Construction




Measuring productivity in any enterprise is critical to success.  If the cost of a project, measured in time, materials, labor and other resources is unknown, or at best murky, pricing the project accurately presents challenges. In construction, which confronts the iron triangle of cost, quality and schedule daily, lack of precision presents all stakeholders with opportunities for graft and risks of loss.  Our antiquated procurement methods - design bid build chief among them - exacerbate these problems.  Dr. Teicholz at Stanford University brilliantly addresses the labor prong of the issue in his most recent article in AECbytes titled Labor-Productivity Declines in the Construction Industry: Causes and Remedies (Another Look).  I linked to the article last week and wanted to share Dr. Teicholz's introduction to the statistics that control the debate. His insights deserve careful analysis by advocates of BIM and IPD in construction and I encourage readers to take a long hard look at the article and think about all the ways the lack of productivity in labor impact and are impacted by defective logistics in construction.  Our inability to deliver personnel and or materials to the site "just in time" as manufacturers do negatively impacts our ability, as an industry, to impact the iron triangle of cost, quality and schedule in a positive manner.  Bill Standish's company, Stangate Management, Inc. is working hard to solve the logistics problem in the Midwest, but much work remains. 

Dr. Teicholz's introduction to the critical statistics, vis a vi labor in construction, is excerpted below. 

The definition of labor productivity at the task level is quite simple: output per work hour, e.g.,50 SF per work hour of wall forms built to a given specification at grade level.  However, when measuring the output of entire industry rather than a task, output is defined in dollars of revenue (for a given base year) per work hour.  There are two US Government agencies that measure the outputs and inputs of almost all industries.  The Census Bureau (CB) focuses primarily on outputs (such as the C30 series of construction industry output) and the dollar value of inputs, while the Bureau of Labor Standards (BLS) focuses on labor inputs and many other measures of labor. The data sets produced by these groups are updated weekly, monthly, annually,and for the Census Bureau, every 5 years in their Economic Census.  BLS does calculate labor productivity for some industries, e.g., manufacturing and all non-farm industries, but does not do so for the construction industry. It requires careful use of the available data to make valid comparisons over time and within different sectors of the construction industry. A third government agency, the Bureau of Economic Analysis (BEA) takes the data collected by other agencies (CB, BLS, and others) to develop GDP, Value Added, Input/Output analyses and other measures of US economic activity. Using the data from these three sources provides many insights into the construction industry.

Here's another LINK to the article.  Print it, read it, analyze it and solve the problems highlighted in it on your next project!


Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Friday, December 5, 2014

How small is too small for IPD?




My good friend Oscia Wilson, the founder and president of Boiled Architecture, knocks the question out of the park. Oscia is also the the author of The Owners Guide to Starting Integrated Projects. I strongly encourage you to click the link and get a copy of that book on your shelf!  Anyway, she received the question through the Boiled Architecture website and, as noted above, she knocked the question out of the park.  Below is short excerpt of her rationale along with the killer graphic she posted and a link to the blog post.  Call her if you need a BIM and IPD enabled architect on your team!


My answer is "Anything smaller than a dog house, doll house or wood shed." but Oscia is more polite and thoughtful than me.

As Oscia argues:

IPD projects heretofore have been large projects–many of them were new hospitals.  Many of them had more than a dozen companies signed onto the multi-party agreements.  These typical IPD projects have project teams of several hundred people.
Of course it takes a long time to get a dozen companies to agree to a contract they’ve never done before, especially when millions of dollars are at stake.
Of course it takes a long time and a lot of effort to teach hundreds of individuals how to work together in radical collaboration and un-learn their bad habits.
And yes, when you want hundreds of people to collaborate for 5-8 years, you absolutely need a giant colocation space with its own dedicated server and technology solutions.  These take time and money to set up.
But guess what – None of that is true with a small project. 

Here's the killer graphic.

Effort graph


Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















A Great C.S. Lewis Quote




"I'm from the government and I'm here to help!"  Oh wait, that's not it.  Here you go,

"Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. They may be more likely to go to Heaven yet at the same time likelier to make a Hell of earth. This very kindness stings with intolerable insult. To be "cured" against one's will and cured of states which we may not regard as disease is to be put on a level of those who have not yet reached the age of reason or those who never will; to be classed with infants, imbeciles, and domestic animals." 

-- C.S. Lewis, God in the Dock: Essays on Theology (Making of Modern Theology)

Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website















Fifty (50) Years of Failure in Construction: Let's Change That!




As an advocate of building information modeling, (BIM) it's kissing cousins virtual design and construction, (VDC) and integrated project delivery, (IPD) I closely follow developments in the construction industry.  In 2001 I read an article by Dr. Paul Teicholz in which he detailed deficiencies in the labor productivity rate in construction.  As a construction lawyer involved in the triage of failed construction projects I was keenly aware of the failure points that lead to low productivity rates in the industry.  The 2001 article highlighted fundamental failings in the construction industry and I began to question the wisdom of the legal framework within which I operated on behalf of my clients.

Dr. Teicholz's article gnawed at my conscience and I eventually launched Collaborative Construction, which regular readers know provides preventive legal services and collaborative consulting to the construction industry.  Dr. Teicholz recently published a follow up study in AECbytes Viewpoint #67 (March 14, 2013) titled Labor Productivity in the Construction Industry: Causes and Remedies (Another Look), and like the initial article in 2001, the study commands the attention of the industry.

I linked to the article on this blog when it first came out but I recently re-read the article in preparation for two upcoming presentations (NAHB International Builders' Show in Las Vegas and the 2015 Construction CPM Conference in San Diego) and I wanted to again bring Dr. Teicholz's excellent analysis to the attention of the industry.

I tell clients' all the time there is a 40% to 60% rate of waste on capital projects and they routinely push back, arguing there are no lean six sigma style studies in the construction industry that confirm those claims.  I counter those arguments with a detailed review of Dr. Teicholz's study.  The keystone of his analysis is the chart below that shows the stagnant nature of labor-productivity rates in construction compared to all non-farm industries.


While the chart ends in 2012 we know the trends continue and we are now at the 50 year mark.  How much longer will we wallow in this failure as an industry?

Dr. Teicholz identifies the problem with ruthless precision and the outlines a number of potential solutions as well.  It's time for the industry to step to the plate.  Below I've outlined the problem, solution and strategy in simple terms.  This is the approach Collaborative Construction and its allies, like FirstPlan, LLC, and Benjamin Yocum & Heather, LLC take.  If you have questions about how to create a smart built culture within your organization please call.

Problem: The industry wastes 40% to 60% of the labor, materials and time invested in capital projects.

Solution: Integrated teams capable of deploying better planning, design and construction processes.

Strategy: Create a smart built culture that supports and enables planning, design and construction in a trust based environment.

Action: Contact us to learn more about the key to creating a smart built culture strategy in your organization.


Welcome to the Collaborative Revolution!

James L. Salmon, Esq.
Collaborative Construction
300 Pike Street
Cincinnati, Ohio 45202
Summary of Services and James L. Salmon's CV


Office 513-721-5672
Fax 513-562-4388
Cell 512-630-4446
JamesLSalmon@gmailcom


Collaborative Construction Website
No Silos Website