NAVAL HOSPITAL PROJECT TEAM EXECUTES A COMPELLING OFFENSE IN THE BATTLE AGAINST PROJECT RISK
BY JIM EISENHART
VENTURA CONSULTING GROUP
The design-build project team for the new $448.8-million U.S. Naval Hospital at Marine Corp Base Camp Pendleton faced a big challenge. They were charged with building a leading-edge, 500,000-sq-ft hospital and surrounding medical campus, and it had to be built on budget and within an unprecedented time frame.
Constructing a state-of-the-art medical facility of this size and scope was a feat in and of itself. Yet, the primary challenge of this project was meeting its aggressive schedule imposed by federal funding requirements. In other words, if the project wasn’t completed within the specified time period, it would not receive the allocated funding.
The Navy’s typical time frame to design and construct a hospital project of this magnitude and scope is five to seven years. Yet, joint-venture builder Clark/McCarthy, a San Diego AGC Chapter member, proposed an aggressive 40-month schedule in order to meet the project requirements.
Some of the Navy participants in the initial partnering workshop expressed their strong concerns with this seemingly “impossible” timeframe. They also pointed out that the funding for furniture, fixtures and equipment (FF&E), as well as for medical equipment, was in the 2014 budget which couldn’t be changed without Congressional approval.
However, U.S. Navy Captain Mike Williamson was more optimistic. “If this team believes they can achieve those dates,” he says, “we might be able to get the funding earlier.” Sure enough, two months later, at the next partnering workshop, Commander Webster announced, “We’ve got the money.” This solidified the team’s commitment to meeting the aggressive goals for the project.
Although the team’s commitment set the stage for a positive project outcome, the inherent risk for those involved on an important and complex facility like this was extremely high, especially since it had to be completed in record time. With this in mind, project team members put considerable time and effort into mitigating the project’s risks.
PLAYING NOT TO LOSE
On the vast majority of construction projects, individual team members initially engage with a “not to lose” mentality, which is to say, acting with the primary intent of minimizing their own perceived risks. This is prudent and expected. Yet, a playing not to lose mentality becomes self-fulfilling when all team members adopt this mindset and is manifested by behaviors that push risk onto others.
For example, an owner’s effort to establish and enforce actions to rigidly conform to a baseline schedule may create an environment that works against the architect, general contractor and owner. This, in turn, discourages the design and construction team from developing fresh ideas to beat the schedule without compromising quality, safety or budget.
PLAYING TO WIN
A better approach to mitigating risk is to create an offensive game plan as a team. This can be accomplished by enabling the team to develop and commit to compelling, measurable, non-contractually binding partnership goals where each individual is committed to “playing to win.”
Contracts can’t do this, nor can alternative project delivery methods (e.g., design-build, IPD, CM at Risk), collaborative technological tools or good intentions, which are short lived at best. Effective “playing to win” risk management takes open, direct and interactive communication, as well as a process or “game plan.”
“On large, complex projects such as the Naval Hospital Camp Pendleton, you need team goals, openly developed by the entire project team, whose successful realization will come before the interest of any individual stakeholder,” explains Carlos Gonzales, project director of the Clark/McCarthy joint venture on the Naval Hospital project. “The goals must be realistic, but aggressive; and every stakeholder must have complete buy-in for them to be embraced by the team as a whole.”
While this approach takes a concerted effort, it is positive, constructive work that taps the full creative potential of the project team. As a subcontractor said on the Naval Hospital project, “We’re not just building a structure, but delivering a state-of-the-art health care facility for our warfighters to use much earlier than expected.”
EXECUTING AN OFFENSIVE GAME PLAN AS A TEAM
The Naval Hospital project team knew they had to fully commit to this game plan if they were going to mitigate risk and achieve success, so they executed a compelling offensive game plan by following these seven steps:
- Creating clear, compelling common project partnership goals addressing the end user’s/base commander’s real intent, which was to complete the hospital as soon as possible. This was not in the contract documents. Partnership goals also included meeting targets for safety, quality impact on the adjacent military community and JV profitability exceeding contract requirements.
- Focusing on pursuing opportunities as a team, rather than only solving problems or dealing with ‘rocks in the road.’ Instead, they created their own road.
- Developing collaborative task forces made up of individuals most able to contribute to the achievement of the goal or who could best expedite the process. Dates, deliverables and the names of those responsible were established and monitored.
For example, the Naval Hospital team had a quality goal of “full conformance to electronic plans the first time; zero written non-compliances; and, zero punch list at beneficial occupancy.” This goal prompted the quality representative for the Naval Facilities Engineering Command to plan for its inspectors to attend the design-build team’s preparatory quality meetings. In turn, the inspectors not only looked for deficiencies, but also focused their quality efforts on supporting the team goal.
- Creating a behavioral protocol that mandated personal meetings or verbal conversations in lieu of emails or letters except to communicate data or facts. This effort effectively eliminated back and forth e-mail/letter communication that, on most construction projects, wastes approximately 60 percent of a team member’s time. Design development and review were not just done over-the-shoulder, but truly collaboratively, eliminating much of the time set aside for formal design review by the owner.
- Developing a joint risk identification, prevention and mitigation process relative to achieving the partnership goals. Typically, over 85 percent of these risks can be identified by a team at the outset of their job. And, as a team, they can develop ways and means to significantly prevent or mitigate these risks. Clark/McCarthy even had the project’s subcontractors do this exercise among themselves with the understanding that they would come up with recommended solutions without impacting cost or schedule. They agreed that preventing or mitigating these team risks would significantly reduce every project team member’s individual risks.
- Developing and employing a conflict resolution elevation ladder and protocol that expedited the resolution of issues and disputes, and that made it alright to “agree to disagree” while keeping trust intact and not delaying the project.
- Ensuring team and individual accountability for commitments. This process included dealing with non-team players—a huge, potential risk if not dealt with quickly by a project team. But perhaps even more importantly, they also recognized and rewarded individuals for “above and beyond” team behaviors.
“I’ve lost my effectiveness as an owner if the other project members do not come to me with their problems,” says Williamson. “If other members of the team are not sharing bad news with me, and this includes their own profitability, this can lead to suboptimal teamwork and project results. This, in turn, creates a downward spiral.”
Instead of looking for someone to blame, a better tactic is active mutual support of one another toward achievement of the common goals. Playing to win as a team does not mean that individuals abandon due diligence, waive contract requirements or compromise on specifications. But again, this can be done through open communication. For example, “Jack, I’m concerned about having access in this area to support the team’s schedule and while complying with the base security requirements. Can we sit down and discuss this? Who else might help us?” After reaching an agreement, the team can then develop the appropriate documentation if deemed necessary.
The efforts of the Naval Hospital team culminated in delivering the award-winning healthcare facility six months ahead of schedule and more than $100 million under budget. Even more importantly, the region’s military and their families now have a modern, effective healthcare facility they truly deserve.
So how do you want to play on your next project? And, where do you want to put your time and energy? Playing not to lose or playing to win as a team? Better yet, ask those questions of your project team.
Using the above processes to achieve victory as a team is by far your best value approach to mitigating risk, optimizing profitability, realizing personal satisfaction and pride and ultimately winning as a world-class team.
Jim Eisenhart is president of the Ventura Consulting Group in Ventura, California and Connecticut. He was the inaugural recipient of the International Partnering Institute’s “Excellence in Partnering Facilitation” award in 2012. He has facilitated partnering on over 1,000 projects worldwide with 13 of the top 15 GCs in the U.S. He is also the author of Raising the Bar on Construction Project Teamwork: From Good to World Class. Force10 Press, 2011.