2004 First Quarter Publication of the CMeJournal
Editors Comments

Do you want to save money for your clients and at the same time increase your firm’s bottom line?  Assuming that your answer is yes, then you will want to read each of the four articles published in this quarter’s edition of the CMeJournal. 

Don Russell and Dennis Dunne, both fellows of our organization, in their paper HOW HEALTHY IS YOUR COMPANY’S LEADERSHIP DEVELOPMENT PROGRAM have described an industry problem that most of us are acutely aware: “We (the construction industry) have not produced enough good leaders to fulfill the needs of our industry today.”  What does good leadership mean to the projects we manage and the firms we own?  It means the difference between success and failure and yet it appears that programs to develop leadership skills often don’t reach the right individuals, don’t provide the right type of training or are given too low of a priority to be truly effective.  Russell and Dunne have laid out a strong argument that we need to develop a “Leadership Development Culture” within our organizations with effective and focused programs.  They describe an eleven step process aimed at nothing short of a transformational change for our industry. The benefits outlined go “straight to the bottom line” with a “10% or 20% increase in profits”.  This is an excellent and insightful paper from two of our most esteemed members and well worth the read.

Hans Picard in his paper DRIVING DOWN CONSTRUCTION PROJECT LABOR COSTS has asked the simple question, why has construction labor productivity declined steadily for the last 40 years in the US while all non-farm industry productivity has more than doubled during the same period?  More importantly, Picard has answered what can be done to turn the situation around. He has based his work on “field experience of applying systematic statistical value analysis on hundreds of industrial construction projects over more than two decades”.  Through his studies he has shown that a typical construction labor hour contains only 59% productive labor.  While we can look at this statistic as a black mark for our industry, Picard has taken the view that we have significant opportunities to improve labor productivity if we can only accurately measure the factors impacting productivity and to take steps to eliminate or reduce those factors.  Bottom line, through the techniques discussed in his paper, Picard has been able to document a 16% to 27% increase in labor productivity.  This paper is well supported and based upon years of practical experience and research.

Mark Sgarlata and Christopher Brasco in their paper SUCCESSFUL CLAIMS RESOLUTION THROUGH AN UNDERSTANDING OF THE LAW GOVERNING ALLOCATION OF RISK FOR DELAY AND DISRUPTION have systematically covered the legal aspects of one of the greatest risks our construction projects face; the dreaded delay claim.  Sgarlata and Brasco have identified what can and can not be done in shifting risk in order to allocate responsibility for delay.  They have discussed the tricky topic of concurrent delay and how the courts treat the issue. They have discussed methods of scheduling used to support delay and disruption claims and how to price those claims.  The paper is very well written and filled with recent and applicable case citations.  This paper is a must read for anyone responsible for overseeing and managing construction schedules and in resolving delay and disruption claims.  Bottom line, if you don’t pay attention to the recommendations made in this paper your projects are inevitably going to carry greater risk and end up costing more.

Ken Pruett in his paper CONSTRUCTIBILITY REVIEWS: CASE STUDY OF BID DOCUMENT ERRORS AND OMISSIONS has identified one of the biggest benefits that we as professional construction managers can bring to our clients: the ability to use our construction expertise to eliminate and reduce conflicts, errors and omissions in design documents before those documents are put out to bid.  The case study involves a program implemented on the Los Angeles Unified School District which had a $1.5 billion, 150 new school and modernization program.  A formal constructability review program was implemented that resulted in the correction of literally thousands of errors in the design documents prior to bidding.  This is an excellent and real life lesson learned paper that documents the tremendous benefits of performing constructability reviews.  Bottom line, by the elimination of costly change orders during construction, the performance of a constructability review is estimated to result in a 2 to 5% reduction in construction costs. And, when you are talking about a $1.5 billion program, that represents a significant savings.

On behalf of our contributing authors and the CMAA’s editorial board we hope that you will enjoy and gain some benefits from the papers published this quarter in the CMeJournal.  We invite you to submit comments and questions regarding these articles or any of our previously published articles.  We also encourage you to become one of our contributing authors and to submit for consideration an abstract.  Bottom line, when you take advantage of the CMeJournal publishing opportunity, you will have the opportunity to gain some important exposure and recognition and to take part in the on-going dialog of ideas that will help all of us improve our industry.

Gary Berman
Editor CMeJournal
President/CEO
Greyhawk North America