The Challenges and Lessons Learned Related to the

Qualification, Selection and Monitoring of Site

Contractors

Tom Mudge31st Energy & Environmental

ConferenceSeptember 2004Orlando, Florida

LEARNING OBJECTIVES

• UNDERSTANDING RISKS

• KEYS TO SUCCESS

• EVALUATION METHODS

• COMPENSATORY ACTIONS

RISK ASSESSMENT

PROBLEMS ATTRIBUTED TO INADEQUATE PERFORMANCE OF

CONTRACTORS CAN BE AS MUCH AS 60% OF THE OVERALL QUALITY

PROBLEMS ON A PROJECT.

BIG BUCKS $$$$$

RISK ASSESSMENT

• NATURE OF ACTIVITY

• CRITICALITY OF MISSION

• CONSEQUENCES OF FAILURE

NATURE OF ACTIVITY

• TYPE OF ACTIVITY• WHAT CAN GO WRONG?• PROBABILITY • PREVIOUS EXPERIENCE

TYPE OF ACTIVITIES

•REINFORCED CONCRETE

•STRUCTURAL STEEL

•PIPING

•HVAC•CARPENTRY•PAINTING• I&C /

ELECTRICAL

CRITICALITY OF MISSION

• RESIDENTIAL HOUSING• PUBLIC FACILITY Buildings Rail Highway• INDUSTRIAL Chemical / Nuclear

CONSEQUENCES OF FAILURE

• LOSS OF LIFE AND LIMB• REPAIR / REWORK• SCHEDULE DELAYS• CONTRACT TERMINATION• CUSTOMER SATISFACTION• DAMAGED REPUTATION

COMPENSATORY ACTIONS

•SURVEILLANCE / AUDIT•WITNESS / HOLD POINTS•CONTINUOUS OVERSIGHT - INSPECTION - TESTING

ATLANTIC CITY GARAGE COLLAPSE

• INADEQUATE REBAR INSTALLATION

- Quantity - Connections• NO CYLINDER TESTING• NO BRACING• SCHEDULE PRESSURE

KEYS TO SUCCESS

• MANAGEMENT SYSTEM - Organization• PROJECT TEAM PERSONNEL - Technical Background - Work Experience - Team• MANAGEMENT’S ROLE

HUMAN SIDE OF QUALITY

PRIDE

LOYALTY / COMMITMENT

EGO / POWER

INTEGRITY

“ME”

DON’T UNDERESTIMATE THE HUMAN SIDE

OF QUALITY.

ORGANIZATION

• INDEPENDENCE

• MANAGEMENT INVOLVEMENT - AWARENESS - RESPONSE

Contractor Characteristics

Contractor A Contractor B Contractor C Contractor D

Type Local Local National National

Supervision Long Term Long Term Long Term Short Term

Work Force Long Term Short Term Short Term Short Term

Team Experience

Yes No Yes No

Management Involvement

Close Intermittent Intermittent Intermittent

EVALUATION METHODS

• REVIEW QA MANUAL• REVIEW RESUMES• FACILITY SURVEY• QUESTIONNAIRES• PREVIOUS CUSTOMERS• MANAGEMENT OVERVIEW

INVEST IN THE EVALUATION PROCESS

THE COST OF THE EVALUATION PROCESS IS

MINOR COMPARED TO THE COST OF FAILURE –NOW AND THE FUTURE

SELECT THE BEST

All companies will occasionally

experience quality problems on their

projects.

What sets the good

contractor apart, however, is their ability to

understand why the problem occurred and implement effective

corrective action to prevent recurrence in the future