March 13, 2013

Owner's panel lays out expectations

VINCE VERSACE

DCN managing editor

LA MALBAIE, QUE.

Increased collaboration, flexibility and fiscal predictability are among the key owner expectations in the current construction marketplace, an owners' panel explained at the Canadian Construction Association (CCA) conference.

“There’s certainly a more complex world now, more collaboration and technology is required. I think we are getting to the point that we really need to change how we deliver projects,” said Diane Dalgeish, Alberta Infrastructure assistant deputy minister.

The CCA held a session called Meeting the Owners’ Expectations in the Current Construction Marketplace at its 95th annual conference in La Malbaie, Que.

Representing owners on the panel were Dalgeish, John McBain, Department of Public Works and Government Services (PWGS), Real Property Branch, assistant deputy minister, James Paul, Defence Construction Canada (DCC) president and chief executive officer (CEO), John McBride, PPP Canada CEO, Sarah Clark, Partnerships BC CEO and Mark Mulholland, Brookfield Johnson Controls managing director.

The panel members explained what the changing expectations are from an owner’s perspective and how the delivery of design and construction will need to change in response.

Panel members universally agreed that construction needs to begin to invest in improving productivity and the use of project tools such as Integrated Project Delivery (IPD), lean principles and Building Information Modeling etc.

Dalgeish added that through traditional design-bid-build projects there was a “luxury of time” for planning, design, tendering, bidding and getting the lowest price.

However, recent “political drivers” have required a change in order to deliver infrastructure quickly.

“We have been relying a lot more heavily on construction management and public-private partnerships (P3) to deliver infrastructure,” she said.

“Those project delivery methods suit better the way we have to live today. They are a more collaborative process, linear and take less time if you’ve done it right. They tend to give the owners what we need.”

The use of design-bid-build was also standard for PWGS, noted McBain.

“We are very much into a different mode. We use a variety of solutions to meet our needs – it depends on the program requirement, market, and the location.”

McBain added that PWGS project approvals go through an “intense justification” with the Treasury Board and ministers approving the project.

“That scrutiny talks about first and foremost value-for-money or the lifecycle cost of the project,” he said.

Clark said construction can expect to look for more accountability built into projects.

Clark has participated in procurement teams for some of British Columbia’s largest P3 projects.

“What does accountability mean? Risk transfer in some cases, innovation and communication around the outcome of a project,” she said.

“I think governments are less and less resourced to be able to implement these projects and they are looking for resources to do it.”

PPP Canada is the lead adviser on federal P3 projects and is responsible for the $1.2 billion P3 Canada Fund.

The corporation reports to the federal finance minister and a “minister of finance likes fiscal predictability,” said McBride.

“In tight fiscal times, knowing what things are going to cost and when things are going to cost are a huge advantage,” he added.

For Paul at DCC, the team approach is considered the best approach for overall facility delivery management.

“We are moving to more innovative, collaborative delivery models. Whether it is some form of design- build or modified design–build, even IPD or modified IPD,” he said. “The things that work for our model are much more collaborative.”

Mulholland said one of the biggest things for Brookfield Johnson Controls is a more performance-based approach to how they manage their vendors and contractors.

They look for performance items such as on-time, on-budget, bringing the right team to a project, quality workmanship and fairness in change orders.

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