Thursday, August 20, 2015

The Built Industry's Backwards Bicycle


Tanner Clark, the Director of BIM/VDC Construction Services for Stuart Olson out of Canada recently asked me, "Why is the uptake of BIM and IPD so slow in the Built Industry?" That's a frequent question, especially from sophisticated BIM users like Tanner who instinctively see the value inherent in IPD and experience immense frustration leading change efforts in the Built Industry. The conversation continued with Susan Wadsworth and Patrick Duke the Marketing Director and Managing Director, respectively, of CBRE Healthcare Services and Susan reminded me of the Backwards Bicycle post being discussed in the IPD Thought Leaders group on LinkedIn. After mulling those conversations over I wanted to share my thoughts on the Backwards Bicycle analogy.

The simple answer to Tanner's question of slow up take of BIM and IPD is that too few owners are demanding BIM and IPD and too few Architects, Engineers and Constructors - not to mention Trade Contractors and Suppliers - are prepared to deliver BIM and IPD. But the problem runs deeper than that.

Why aren't more owners aware of the benefits of BIM and IPD and why aren't more AEC Firms pushing BIM & IPD internally and externally? Because the industry is addicted to extracting profits from the 40% to 60% waste of time, materials, labor and other resources embedded in the Design-Bid-Build delivery model. Owners that procure planning, design and construction services under the Design-Bid-Build delivery model mistakenly believe that model saves them money. AEC Firms, Trade Contractors and Material Suppliers know better and have developed business models that EXTRACT profits from that waste stream.

In other words, the entire industry is riding a Backwards Bicycle that is incredibly inefficient but which proves lucrative to those who know how to ride it.  BIM & IPD, by contrast, require that the Built Industry learn to ride a Regular Bicycle, which is incredibly efficient but not quiet as lucrative. Riding a Backwards Bicycles is dangerous and the industry crashes it a lot. But again, those who master the Backwards Bicycle reap huge rewards at the expense of those who crash. As we adopt, adapt to and deploy BIM and IPD the Built Industry needs to transition to a Regular Bicycle, even if experienced Backwards Bicycle riders crash their Regular Bicycles from time to time.

To understand the foregoing Backwards Bicycle analogy you MUST WATCH the video below. If you don't have time to watch it bookmark this blog post and return to it so you can WATCH THE VIDEO. And you must WATCH TILL THE END as there is a twist that is very important to understanding our challenge in the Built Industry.



When one recognizes the Built Industry's preferred delivery model, Design-Bid-Build, is a special Backwards Bicycle that benefits waste based business models it's easy to understand the proliferation of waste based business models in the industry. Facilities procured under a Design-Bid-Build procurement model enjoy a waste rate of 40% to 60% and that waste rate flows through everything from labor to materials and cash. In an environment where 40% to 60% of a capital budget is waste sharp business owners will find ways to EXTRACT profits from that waste stream. Especially if the competition lacks the skills necessary to ride the Built Industry's special Backwards Bicycle. The Built Industry spent over 150 years perfecting their Backwards Bicycle, but now the internet threatens to undermine that model by enabling the use of Regular Bicycles.

In the information age Design-Build, Public-Private-Partnerships and Integrated Project Delivery (IPD) represent competing delivery models that lend themselves to the use of value add business models. Of those three only IPD fully embraces the spirit inherent in value add business models. In other words, IPD is the only Regular Bicycle in the shop! The video below is a STARK reminder of what can be accomplished on a Regular Bicycle. Image Danny MacAskill trying to perform on a Backwards Bicycle... that's what we are doing when we force the best and brightest in the Built Industry to work under a Design-Bid-Build delivery model ... we FORCE them to ride a Backwards Bicycle to work every day!



By extension BIM and IPD are only "no brainers" for enterprises that adopt a value add mindset with the intent to EARN profits by adding value. That is, the enterprises intend to ride a Regular Bike every day. By contrast, those that perfected business models designed to EXTRACT profits from waste have ZERO interest in learning to ride a Regular Bike.

Unfortunately, the built industry finds itself straddling a fence, with Design-Bid-Build enabling waste based business models on one side, and demands for BIM and IPD enabling value add business models on the other. To survive most businesses need to keep one foot in the waste based environment - especially while public owners stupidly insist on procuring planning, design and construction services via Design-Bid-Build - while simultaneously preparing to compete for and win work in an IPD environment that rewards value add business models. Accordingly, to successfully transition from the waste based model to the value add model businesses must train people who spent their ENTIRE LIFE riding the Backwards Bike to ride the Regular Bike.

The foregoing explains, in part, the slow uptake of BIM and IPD.

Meanwhile, a summary of my experience and qualifications is set forth below for interested parties.

Experience and Qualifications
James L. Salmon's CV

Creative Counselor – Collaborative Consultant – Change Champion

Exceptional lawyer, mediator, collaborator, mentor and strategic change champion
creating integrated BIM enabled teams in energy, healthcare, higher education,
government, transportation, mining, and construction capable of planning,
designing, constructing, operating and maintaining infrastructure
more efficiently and more intelligently over the
life-cycle of the infrastructure
through the use
of IPD and
BIM

Expertise and Knowledge

  
● Integrated Project Delivery (IPD) ● Integrated Team Building ● Procurement of Integrated Services ● Functional Digital Assets ● Lean Processes ● Building Information Models (BIM) ● Collaborative and Integrated Agreements ● Public Private Partnerships ● IPD, BIM & Lean to Increase Efficiency ● Risk Management & Mitigation ● Preventive Law ● Strategic & Lean Process Plans ● Lean Supply Chain Management ● Integrated Project Delivery Guides ● Integrated Project Insurance ● Net Zero Energy Plans ● Smart Built Cultures™ ● Construction Litigation ● Insurance Coverage ● Bad Faith Litigation ● Expert Testimony ● IPD Financing ● Financing & Insuring Public Private Partnerships ●

  
CURRENT EXPERIENCE 
President of Collaborative Construction Resources, LLC
  • Provide collaborative consulting services to integrated BIM enabled teams – consisting of owners, designers and constructors – to increase the efficiency with which such teams deliver capital projects
  • Teach built industry professionals, students - both graduate and undergraduate - and others about the cultural and legal implications of BIM and IPD
  • Develop visionary business processes – including the Smart Built Culture Program – that enable integrated BIM enabled teams to public sector capital projects more efficiently
  • Launch IPD Round Table Series, a web-based series of collaborative workshop, to introduce participants to IPD, BIM and Lean processes as tools of efficiency
  • Serve as editor of the BUILT – BIM to FM section of the AUGIWorld Magazine and author articles in the series
  • Retained as a litigation consultant by law firms, contractors and designers to prepare expert witnesses to testify in complex construction disputes – including several involving public private partnerships worth more than $200 million – throughout the country
  • Created web-based presentations detailing the key features of a new generation of legal instruments
  • Launched and managed a series of national webinars introducing Collaborative Construction and IPD in 3D™ to owners, designers and constructors involved in planning, designing, constructing and maintaining complex facilities for public and private owners
  • Wrote content for dozens of web-based presentations introducing AEC professionals to innovative business processes revolutionizing public and private procurement of integrated services
  • Joined the National Building Information Model Standards (NBIMS) Project Committee as a contributing member, analyzed and presented seminars on the resulting NBIMS Protocol
  • Selected as a member of the buildingSMARTalliance’s Business Process Integration Task Team charged with integrating BIM into everyday business processes
  • Formulated practical business processes for the use of functional digital representations of facilities and infrastructure on public and private construction projects
  • Joined the Lean Construction Institute to advocate the use by integrated BIM enabled teams of Lean Construction techniques
  • Made a series of national presentations to public owners’ groups regarding implementation of the ConsensusDOCS 300 Series Tri-Party Agreement for Collaborative Project Delivery
  • Worked with the Construction Users Round Table (CURT) locally and nationally to publicize Collaborative Agreements, BIM, Lean Construction and Integrated Project Delivery to public and private owners
  • Founded and managed the 3,000+ member LinkedIn Group, Collaborative BIM Advocates which provides networking opportunities for like-minded professionals seeking to become members of integrated BIM enabled teams around the globe
  • Author, edit, publish and distribute Collaborative Construction Blog and Newsletter to members of the AEC industry, including integrated BIM enabled teams, around the globe
LEGAL EXPERIENCE 
  
Trial and litigation experience involving construction claims 
  • $140 million mixed use development in Cincinnati, Ohio. Served as BIM and IPD consultant to counsel representing trade contractors seeking in excess of $10 million in damages.  Settled claims on terms favorable to trade contractor clients
  • $30 million school construction project. Litigated toxic mold claims related to alleged defects in construction and design in Preble County, Ohio. Won summary judgment on behalf of client-designer in the trial court.
  • $10 million school construction project. Litigated collapse of portion of existing school that occurred during excavation for new addition. Settled claims on behalf of client-owner against general contractor on favorable terms.
  • $280 million hotel and convention center project. Litigated almost 40 separate lien claims filed against general contractor. Settled dozens of claims for millions of dollars on terms favorable to client-general contractor.
  • $25 million hotel project. Litigated toxic mold claims related to defective caulking of the EIFS cladding system on the hotel. Settled claims on terms favorable to owner client.
  • $8 million wood chipping plant explosion case. Litigated claims filed by owner against designer of the fire suppression system installed during expansion of the plant. Settled claims on terms favorable to client-fire detection system manufacturer.
  • $120 million mixed use project procured under P3. Litigated multiple contentious lien claims worth more than $8.0 million on behalf of subcontractors against bank and general contractor. On going. Subcontractor clients.
  • $50 million coal processing plant. Litigated lien claims filed by subcontractors involved in supplying pipe to coal processing plant. Settled claims on terms favorable to subcontractor client.
  • Multi-million single family home development. Litigated toxic model claims related to failed brick work. Settled claims on terms favorable to home owner clients.
  • $30 million power plant. Litigated dispute arising from alleged design defects in the flue. Settled claims on terms favorable to design client.
  • $100 million highway construction project. Litigated multiple wrongful death claims arising out of an explosion that occurred when a DC-9 Cat drug a ripper through a gas pipeline main. Won summary judgment on behalf of general contractor client.
  • $75 million highway construction project. Litigated claims arising from alleged design defects. Settled claim on terms favorable to design client.
Business Litigation and Mediation
  • Defend, prosecute and mediate breaches of non-compete agreements, wage and hour claims, employment discrimination claims and general commercial disputes
  • Pursue and defend claims for injunctive relief on the basis of non-compete agreements on behalf of a pharmaceutical companies, commodities traders and trainers
  • Pursue and defend claims under FLSA, ADA, Title VII, § 1983, and other civil rights statutes
  • Pursue and defend contract claims and tort claims for corporate and individual clients
Teaching Experience
  • Adjunct professor at Middlesex University in London
  • Guest lecturer at the University of Cincinnati College of Applied Sciences
  • Experienced writing instructor and seminar presenter
  • Taught paralegal course at Sheridan Community College
  • Taught paralegal course at Laramie County Community College
  • Teach AEC Professionals about IPD, BIM, Lean Construction and Collaborative Agreements
PROFESSIONAL POSITIONS

Collaborative Construction Resources, LLC
President, February 2008 to the present

Ulmer & Berne, LLP, Cincinnati, Ohio
Senior Associate, December 1999 to February 2008

Lonabaugh & Riggs, Sheridan, Wyoming
Associate, September 1996, to December 1999

Sheridan & Laramie Community Colleges, Wyoming
Adjunct Professor, September 1994 to January 1998

Chief Justice William A. Taylor, Wyoming Supreme Court
Law Clerk, September 1994, to September 1996

Community Involvement
  • Creator of the Charitable Doll House concept for Allied Construction Industries, Inc.
  • Member, Johnson Elementary School Site Based Decision Making Council
  • Co-Chair, Marketing for Johnson Elementary School Fund Raiser
  • President, Texas Tech University Alumni Chapter, Cincinnati
  • Volunteer Mediator, Kentucky and Ohio Courts
  • President, Kappa Sigma Fraternity, Texas Tech University
Education
  • Texas Tech University (B.A., 1991)
  • University of Cincinnati (J.D., 1994)
  • Certified Mediator, Administrative Office of the Courts, Kentucky
Publications & References
Available upon request

Welcome to the Golden Rule Alliance

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












3 comments:

VicO1 said...

James,

I continue to think about enterprise-level change, and this business of learning new behaviors and etching new neural pathways. Why is it, for example, that it took the person in the bike video 8 months to learn/unlearn bike riding? Why is it that it would take that same guy only a few experiences with crack cocaine to learn to use it and want to use it again and again? The brain can be geared to "rapid learning” when the circumstances require.

Behaviorists, certainly since Skinner, have been telling us that positive reinforcement delivered on a rather random schedule, is a more powerful reinforcement than “aversive” (unpleasant) reinforcements. Falling off a bike is an aversive reinforcement to my way of thinking. It tells you something is not working, but does not tell you what to do right. Addictive substances provide immediate gratification (positive reinforcement) at a very deep neuro-chemical level and learning is very fast – with potentially disastrous consequences.

Some rapid learning – often the fastest, comes really a aversive experience – often something life threatening. Our neurology jumps into action and says, “Whoa! Don’t’ do that again!” Stepping into traffic, and almost getting hit, or seeing your two year old heading out in front of an oncoming vehicle will create some new neural pathways in a jiffy! But that is not the sort of learning we want to have on the work site, except, perhaps, in some limited ways, like when a Foreman comes down heavily on someone for a safety violation. But the danger with aversive reinforcement is that is also gives other messages – like “Don’t get caught next time”.

When there has been has been a long history of positive reinforcement for construction behavior that is not actually very effective, and therefore the target of change during a Lean Transformation, and when in the training environment some level of failure is suddenly experienced as in the Katy’s Castle exercise, the combination of expected success and experienced failure creates what is called “cognitive dissonance”, i.e., confusion/mixed messages. Neuro-Linguistic Programming (NLP) is a form of psychotherapy (though some think of it more psycho-manipulation) which noticed that people become highly suggestible (open to influence) when something unexpected and confusing creates a moment of cognitive dissonance, and has intentionally used the creation of cognitively dissonant moments to suggest new ways of behaving or thinking at a moment when access to the unconscious and rapid learning capabilities is heightened. That may be what is happening, somewhat more slowly but systematically, in your workshop.

One thing we seem to see in Lean Transformation is that once one has experienced the Lean “Ah-Ha!” moment, and begins to see the world through “Lean Lenses”, as I call them, the world does not look the same again. We have learned to ride the bike in a new way, one that works better. That is certainly true for those of us who have made the transformation. We will not go back to the old ways. However, we also see companies that have used Lean on one project, but not on all their projects, take “Lean Teams” off to a new project where Lean is not embraced, and they can quickly revert to old behaviors – like alcoholics falling off the wagon. (Comment will be continued)

VicO1 said...

My current thinking is that we need to address lean transformation on many levels. Learning experiences and training are high leverage opportunities – and they need to be because they are rather expensive. The more we can learn about accelerated learning, the better. And back to behavioral psychology, we also need to make sure that there is positive reinforcement built into the systems we introduce. I have supported teams that rapidly pick up Last Planner behaviors when they use tools like SPS Production Manager or Ghafari vPlanner, because both of those systems provide a variety of clear reinforcements of desired behavior. By using such tools, one can immediately see whether a revised plan of action enhances or constrains the ability to meet production targets. A better plan give an immediate “win” and positive reinforcement. Automatic measurements of “Percent of Plan Completed/Commitment Reliability” (PPC/CR) are also rapid reinforcers. However, if those reinforcements exist in a contractual atmosphere that does not reward the new behavior, mixed signals are created, confusion is experienced, and because confusion is an unpleasant/aversive experience, the positive reinforcement is undone. The cognitive dissonance created may even open participants to receiving the wrong messages, if, for example, their boss or owner sees time spent on collaborative planning as an unnecessary overhead expense and actively discourages participation.

This brings me back to the first of Deming’s famous 14 Points: “Constancy of Purpose”. We simply have to have senior leadership in place that will support capital project delivery transformation over the long haul, will deliver consistently supportive (even when delivering criticism) messages. And we need contractual agreements that support and reward the desired future state, rather than frustrating it. Piecemeal and incremental change efforts will not get the job done. An enterprise-level approach is required.

Bill Standish said...

James, this is an excellent article, video (s), and a great follow up response from Vic01. This is really deep stuff but I truly believe in the Construction Enterprise approach (ALL aspects of a project not just the jobsite) and now I have a better understanding of why the construction industry is so slow to transition to a better model. Basically they learned a backwards approach that made them a lot of money and are trapped in that world and have no positive reinforcement to make a major commitment towards a new world. But almost every industry has face similar circumstances and something eventually forced them to change i.e. technology, societal acceptance, customer demands, etc. Now if we can figure out how to get the senior construction executives to embrace this maybe we will have a chance to move forward more quickly.

I also believe in the value of being the first-provider (Stangate’s supply chain management for commercial construction) or first-adopter (Owner, CM, Trade contractor) who will be the leader and consequently reap the greatest reward. So maybe it has to be the Owners who become the first adopters not the CM! After all, it is the Hospital group that builds 5 hospitals in a decade that really will benefit most not the CM or trades. The constructors will realize some gains from a less wasteful environment DRIVEN by the Owner who might realize a 25+% drop in construction cost per hospital! So the Hospital group becomes the real winner because they save a half a billion dollars or more over a 10 year period and literally dominate (annual review per hospital) every one of their markets because they are the most cost effective provider (low cost producer). Probably every insurance company will flock to them to establish long term healthcare partnerships because of that lower cost structure. So the Medical Groups should WANT to ride the Regular Bicycle now and lead the construction industry into the new age!

Regards,
Bill Standish
Stangate Management,Inc.