By David Fiore
Every construction project involves partnerships. Not the legal partnerships that we might be accustomed to, but daily partnerships that involve companies, communities, regulators and PEOPLE working together to make a complex set of systems come together to become a beautiful piece of work. I’ve long been concerned that our industry approaches these relationships as adversarial situations that must be overcome in order to be successful. Building owners far too often treat our General Contractors with mistrust expecting to be overcharged and mistreated. GC’s in turn treat Subcontractors and suppliers with the same disregard and expectation of the negative. There is a common practice of gamesmanship equivalent of playing poker rather than working for the same goal – BUILD AN AMAZING, QUALITY PRODUCT FOR A REASONABLE PRICE and allow all parties involved to make a reasonable profit. Sadly, we have come to expect that every project involves one or more parties winning at one or more parties’ expense.
I don’t believe it has to be that way – in fact, I KNOW it doesn’t have to be that way. The most successful projects I have been involved in have had everyone working together as a team to ensure that everyone was accountable to each other and worked to find mutually beneficial solutions. Added work or unforeseen conditions were treated as real and acceptable cost impacts. Schedule conflicts were negotiated and worked out. Change orders were approved with little consternation because they were reasonably priced. The original contract didn’t contain gaping holes in scope because the Prime Contractor insured they provided a full and accurate bid. When the project starts out on the right footing (kind of like our buildings) the rest of the project can go smoothly. I’ve seen it work the right way and I question why ANY of us in the construction industry would accept doing work any differently. Sadly, the answer is “because ABC Contractor is willing to do it” and we need the work. Do we really need to work that badly that we are willing to work for a loss, compromise our quality, not pay our bills or miss our performance deadlines? If the answer is YES, then you are on your way out of business anyway so cut your losses now – with that standard it’s only a matter of time.
We damage the overall industry when we allow projects to proceed with short scopes, unreasonable schedules or low price contracts that are created with known unreasonable performance expectations. We’ve all seen them. Contractor or Subcontractor X comes in with a bid that is 10% lower on price claiming that they can meet the expedited schedule and will guarantee no change orders. We know it’s too good to be true, but we ask them – “are you sure you have all of this covered” and we write up the contract. Then somehow, we are surprised when they aren’t showing up, asking for change orders, not paying the bills and having mechanic’s liens filed against our project. That doesn’t sound like success to me. Interestingly, most of us got into this industry and have moved up in this industry because of our ability to fight it out and end up on top so we believe that’s what it takes to succeed. The belief is if you try to partner with contractors you will find yourself on the losing side because Construction is more like a UFC Fight than a Yoga studio. Sadly, it has been that way and following a UFC fight, both parties are bloodied and hurt, but one party has clearly one, but both parties question whether they want to do that ever again. At the Yoga studio virtually everyone leaves feeling fulfilled and ready to do it again tomorrow.
Expect more out of your relationships with your Owners, Contractors, Subcontractors and Vendors. Collaborate. Ask for sharing of ideas on how to manage costs. Pre-select your project team based on a combination of trust, financial stability, capability and willingness to collaborate. You will that your projects will result in overall shorter build cycles, cheaper prices and better quality because you will have a team of people focused on mutual success. Long term there is no such thing as win/lose in this business. If you are an owner that believes you can build quality projects with that model you will find a marginal success rate – buildings may get built inexpensively, but schedule or quality with falter. If you are a GC that believes you can profit off the ignorance of your Subcontractors you will eventually be left with uncompleted contracts, poor work quality, mechanics liens, etc. If you are a sub that expects your suppliers to provide lower cost product with better service you will eventually get left short of supplies and missed schedules or cost overruns.
My goal as a construction business owner is to find owners, clients and vendors that value partnership – that understand the relationship between quality, schedule and price. It’s shameful to watch the games. It’s sad to watch the lies and deceit we share with one another because we don’t believe that we all have something to gain by working together. We can do better as an industry and we can all be successful.