Operation Mindshift Corenet 08

CoreNet Global Summit

#11 A Corporate Real Estate “mindshift”: The New Trust-Based Turnkey Approach to Building and Development

Moderator:Rick Page, GVA Williams

Speakers:Dean Strombom, GenslerMark Iammarino, Turner ConstructionRex Miller, mindshift

A new way of thinking about an old problem.

Acknowledgements/Credits is comprised of AIA, GSA, Gensler, KPMG, Metropolis Magazine, Turner Construction, Haworth, WP Moore, Acoustic Dimensions, Kyle Davy Consulting, Lucchesi Galati Architects, Transwestern, Cushman & Wakefield, Solidus, and Aardex. Our purpose is to shift the building culture toward greater collaboration and integration.

Learning ObjectivesExplore and Explain:

• Broken Buildings and Busted Budgets* - the industry today.

• What is the mindshift?

• 4 Principles.

• 5 Keys to Alignment.

*Barry LePatner

Agile Race in an Institutional Buggy!

Silos

McDonough Holland & Allen PCAttorneys At Law

Adapted from:

“Buildings Leak at the Intersection of Contracts”

Adapted from: Todd Zabelle, Strategic Project Solutions

Hierarchal Delivery Model

Fielding a New Team Every Project

80% of the Cost is Brought in Late

McDonough Holland & Allen PCAttorneys At Law

Adapted from:

If Corollas were Design-Bid-Build?

Design-Bid-Build…It would cost: $44,000

and it would be• Late• Over budget• Value-engineered• Missing parts• and have

No warranty

Integrated…It would cost: $16,000

Waste in the System

Manufacturing Construction

12%

57%

The Brutal Facts• $700 billion annual WASTE

(BuildingsSmartAlliance)

• 48% of GHG (Energy Info Admin Statistics and Pew Climate report)

• 70% over budget and late

• 10-12% Annual Cost Escalation (RS Means)

Owners Demand Fundamental Change

Construction Users Roundtable (CURT):“Address the perception of inadequate, poorly coordinated AE drawings and the resulting difficulties in the field. These problems are symptoms of larger industry issues.”

Principle 1: Trust-Based Teams

• Values

• Capabilities

• Play Book

• Tools

• Pre-Game

• Measure

• Improve

Principle 2: Getting it Right at the Start

“All the big mistakes are made in the first day.” — Paul Adams, AIA

1. The Team Aligns with the Business Plan

2. The Business Plan Drives Design

3. Design is an Early Collaborative Process

4. 80% of the Cost Lies with the Sub-trades

Principle 3: Built-In Sustainability

• By Removing Some of the 57% Waste.

• Through Good Design vs. a Check List

• The 2030 Challenge demands a new approach.

• Smart developers can gain a competitive advantage.

Sustainable projects at no premium using integration.

Principle 4: True Improvement

A common team, process plus relevant performance metrics allows continuous improvement.

Alignment 1: Big BIM

• Collaborative Design• Modeling is Different than

Drawing• Subs Model Shop Drawings• Collision Detection• Target Costing• Full Project Simulation• Off-site Fabrication• Life Cycle testing• Built-in Sustainable

Alignment 2: Toyota Style

• Reduces cost by 30%• Client Defines Value• Involve Those Doing the Work• Identify Activities that Deliver Value• Identify and Measures Waste• Create a Process to Remove Waste• Continual Incremental Improvement

• AIA IPD Guidelines• Lean Construction• Responsibility-based Project

Delivery

Alignment 3: Shared Risk/Reward

• Project vs. Scope• Joint Incentive and Risk

• AIA’s Integrated Project Delivery Guidelines

• Egan Report• Project Alliance Guide• Sutter Health Multi-Party

Agreement• Profitable Partnering

Alignment 4: Off-Site Fabrication

• Structure• Interior Walls• Access Floors• Mechanical• Electrical• Plumbing• Concrete• Millwork• Bathrooms

Alignment 5: Performance Impact

Camino RoyaleMulti-Party Agreement

Early Business Model

Little BIM

IPD/Lean

• Off-Site Assembly

• Workplace Improvement

• Sustainability

$94M budget$9M Saved6 Months Reduced6 MEP RFIs37% of Contingency

Results:

Aardex Signature CenterVertical

Integration Early Business

Model

• Little BIM• IPD/Lean Assembly Business

Enhancement Sustainability

$20.5 million/$3 per sqft less than conventional

191,000 square feet

LEED Platinum

User Effective

50% Lower Operations

100% Leased

Results:

A Prescription for Success

MindshiftWiki Resource Site

Mindshift Project Assessment

Mindshift Project Delivery

Mindshift Consulting and Coaching

The Mindshift Cure

Stay Tuned for the Book

The Commercial Real Estate Revolution

Release August 2009 through John P. Wiley Publishing

The Mindshift Cure

Call to Action (1)• Select teams early based on

qualifications

• Prepare to shift $ forward to develop business case, validation and design

• 80% of the errors are made in the early stage of design

• Set up tightly coordinated design through collaboration and/or BIM

• The business case drives design

Call to Action (2)• Be aware of the extend of waste,

develop a plan to identify and eliminate

• Rehearses common avoidable conflicts and errors

• Pool risk and reward to incentivize project results instead of scope results

• Measure performance based on commitments to costs, quality and schedule weekly

• Actively improve upon the metrics developed

Contact InformationRex Miller, Thought Leaderrex@rexmiller.netDean Strombom, Principaldean_strombom@gensler.comMark Iammarino, VP/GMmiammarino@tcco.com

Website: www.mindshiftblog.comResource Site: www.mindshiftwiki.com