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NEW CONSTRUCTION
STRATEGIES ARTICLES
Southeast
Construction Magazine: March 2005 Issue
One Needed Change is Partnering
By Ted Garrison
Partnering
is not a nirvana. Instead, just like every business
strategy, it’s a choice. However, well-known business
management consultant Peter Drucker hinted at its potential
when he said: “The greatest change in corporate
culture and the way business is being conducted may
be the accelerated growth of relationships based on
partnering.” Of course, Drucker’s
quote isn’t new.
Some
in construction have utilized partnering, to varying
degrees of success, for many years. And, I recognize
that many people in the construction industry think
little of partnering. The problem is that much of what
these people think of when they hear the term is not
truly partnering.
While
seminars can explain how the process works, the problem
is they are usually only attended by project site personnel.
The attendees come out all charged up, but when they
call their office they get something like, “Never
mind – here’s what I want you to do.”
Suddenly, partnering is over and the project isn’t
even out of the ground.
Still,
I believe that it is not whether partnering is needed,
but whether your company will choose to participate.
True partnering is a culture shared by all stakeholders
built on a relationship of trust for the mutual benefit
of all participants.
The
construction industry is made up of five major groups:
owner, general contractor, subcontractors/vendors, designers
and the workers. Only when these groups work together
can they maximize the return for the entire group. Partnering is about developing the
fairest solution. In essence, it’s about increasing
the size of the pie, so there is more to divide among
the stakeholders.
Why partnering is important. Edwards
Deming, a noted business management consultant, has
argued since the 1950s that working together to improve
the systems is the only way to obtain significant improvement.
Those that have followed his advice have seen the benefits,
including lower costs and higher quality. It’s
time the construction industry begins to seriously focus
on this concept and not just apply it in limited situations.
Some of the noted benefits of partnering
include:
Increased profitability for all
stakeholders
Improved productivity
Improved working relationships
Improved communications
Improved quality
Less paperwork
The longer companies work together
the greater the trust and the greater the potential
benefits. Value is added from two basic sources:
Focus
on participant expertise: Negotiated work allows all
members of the team to participant from the beginning.
The benefit is the expertise of each participant can
be utilized from the start. Often design decisions have
negative impacts on construction activities. However,
when the contractors are involved from the beginning
they can eliminate costly delays in revising drawing
at a later date or avoid costly errors. The approach
allows each team member to provide input based upon
their expertise and therefore introduce opportunities
for cost savings and higher quality.
Innovation:
The second major benefit of partnering is innovation.
For innovation to reach its full potential, there is
a learning curve. The more complex the customer’s
requirements the longer the learning curve. For this
reason the longer an innovative contractor works hand-in-hand
with a customer the greater the value they can deliver.
After all it takes effort and money to develop solutions
for the customer, but unless there is sufficient time
to develop them as well as sufficient time for a reasonable
payback, little true innovation will occur.
The next issue will start exploring
the different partnering relationships.
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THE END *
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Ted
Garrison, the author of Strategic Planning
for Contractors, works with businesses
in the constructionindustry. He can be reached
at
Growing@TedGarrison.com
