For most municipalities, a major construction project does not come along very frequently. Administrators with a large renovation and construction program are faced with a dilemma – use their current staff or bring someone in to manage the program. They typically have limited experience with capital construction projects and as a result, these decision-makers can find themselves facing a very costly enterprise, for which they rarely have the expertise or the time required to handle efficiently – and expensive mistakes may be the result.
The Program Manager
You can compare a program manager to the CEO of a corporation, albeit in this case a very specific corporation. A program management team must possess skill sets that include public relations, financial consulting, planning, design, construction, management and the ability to effectively bring together a diverse group of people in a very short period of time. A construction program is very similar. The program manager is the “eyes and ears” of the owner and the manager of the many complex parts of the construction process. A qualified PM firm will have a staff of highly trained professionals that will have the broad experience necessary to handle anything from ordinary to out of the ordinary that happens – surprises are all too common on a construction project, especially in renovation, and a seasoned and experienced PM firm will help to minimize those all to common surprises. With a qualified PM firm there is a good chance that someone on their staff has experience with almost any problem that could arise and this will ensure that it will be handled quickly and effectively – saving you stress, and money while maintaining the project schedule. For example, on one fire district construction project the land deal fell apart just before closing. We were able to identify another parcel quickly due to our connections and experience working with this type of transaction. There was no lost time due to this incident and the new property was an even better location.
Staffing up in-house with good personnel is an option, but it is unlikely that they will be equipped with the control systems and technology necessary to manage the project successfully. Even the most dedicated staff members may not be able to keep up with the schedule and time needed to provide sufficient management. Then there is the problem of down-sizing after the completion of the project. Usually the out-sourced PM team is no more expensive than an in-house team – and is without the overhead costs and disruption to your internal staff. When the project is over the PM firm goes away. Most important to the client, because a PM firm is an independent third party representing the owner’s interest, the program may be viewed as more objective, credible and will get better buy-on than if the program is managed in-house.
Many municipalities will turn to an architect or a general contractor for guidance, but they usually only offer services that directly address specific issues – they do not have knowledge or oversight of your entire program – thus their solutions can be inefficient or short-sighted and may actually cause more problems. On the other hand, the PM participates in every step of the project and has broad oversight of the budget, schedule, quality of work and the client’s goals.
Well Rounded Expertise
A good PM firm is essential in helping the client make sound financial, economic, design and construction method decisions and should be brought on as early as possible in the process, usually way before design and financing.. One of their most important roles is to guide and advise the client in funding decisions, design options, construction methods, as well as assembling the design and construction teams that will be reflect your culture and goals. An experienced and reputable PM firm will bring systems and procedures perfected through years of experience and refinement. Working without them is like flying in a plane without navigation equipment – it is just not a good idea.
With tight budgets, the need to coordinate the many professional disciplines needed for the success of a project, and with so much at stake, it makes sense that more municipalities are turning to a PM to coordinate their capital construction programs, manage the project and make sure that you are getting what you bargained for.
Experience Across Multiple Industries
Organizations are increasingly realizing that traditional forms of project management cannot accommodate the ever-changing landscape of today’s economic, social and business environment. For this reason, a PM firm that has experience working in numerous industries offers an advantage to the district, due to their exposure to numerous funding methods, economic analysis, design and delivery methods, entitlements, multiple contractors, and building methods. A PM’s staff has had exposure to numerous types of requirements, problems and solutions that are an asset to their client. PM firms have the ability to bring new and fresh ideas and methods from one industrial sector to another. This ability to share knowledge across industry sectors brings value to the client and allows capital projects to be executed in a more efficient manner.
What Services Does a Program Manger Provide?
A program manager will put together a plan that will customize their scope of services to the client’s needs. Like a CEO carrying out the needs of its organization, a PM carries out the needs of the client. These services are varied and diverse; may include early program services such as a comprehensive facility assessment, bond referenda strategy services, definition of concepts and needs, pro-forma and economic modeling, assembly of the project team including architect, contractor and consultants. From here they would provide pre-design services, design phase services, procurement phase services, construction phase services, post-construction phase services, and move-in services. A PM firm will also maintain project files for several years after completion. But their involvement should not stop there – there may be warranty and maintenance issues several years later and a good PM firm will make a commitment to helping their clients with these. For instance, our firm was recently called by a previous client who needed information about design and maintenance issues associated with a very complex boiler system nearly three years after project completion. We had the drawings, specifications and warranty information at-hand and were able to effectively handle the situation for them.
What Does it Cost?
There are no hard rules for this, but the fee should be for services provided – nothing more. There can be many variables in the fee such as whether the client can provide a temporary office, if specialized services will be required, if there is a need for a public relations person, and other specialized components. A good PM firm will typically provide guidance and efficiencies that are valued well above their fees; PM firms bring a wealth of experience and knowledge that can be leveraged by the client. Some examples could be their value engineering and cost estimating experts will likely generate cost savings, or the ability to provide funding strategies, the ability to address bond holder questions and concerns, resolve design and constructability issues and many other cost saving attributes. Their team can quickly mobilize to provide the most sophisticated processes and technology available to effectively control costs, schedules, quality and agreements – each of which will translate into value and savings.