Using Desktop Project Management Technology for Construction Close-Out

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White Paper 2011

Using Desktop Project Management

Technology for Construction Close-Out

How utilizing desktop project management technology can improve efficiency,

collaboration, and cost during close-out and after completion of a construction

project.

by Allison Way, Think Big Partners

April 13, 2011

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MySmartPlans: Using OCPM Technology for Construction Close-Out| 1

Using OCPM Technology for Construction Close-Out

How utilizing desktop project management technology can improve efficiency,

collaboration, and cost during close-out and after completion of a construction

project.

Executive Summary

The close-out stage: one of the most important phases in a construction process, but often one that is overlooked by general contractors, architects, engineers, and owners alike. On average, the close-out stage of a construction project consists of 5% of that project’s entirety. However, it takes the same amount of time to close out a construction project as it does to complete the first 95% of the project1. With these statistics, it is obvious that the close-out stage of a particular construction project could be made more efficient and better controlled.

Close-out of a construction project includes several services that are critical to the owner of the building. Within the close-out stage, owners of the new building must be satisfied with construction completion in terms of operation, maintenance, product care, as-built drawings, manuals, and product warranties. Without the complete organization, visibility, efficiency, forecasting, management, and collaboration that an OCPM technology provides, the close-out stage of a construction project can become a lengthy, expensive and confusing venture for all parties involved in the project.

In order to take a project to the close-out stage, subcontractors and general contractors must gather the appropriate close-out documentation and deliver it to the project owner in an organized manner. This can be an extremely labor-intensive task, considering that close-out documents can weigh well over 300 pounds. According to Burçin Becerik of the Harvard School of Design:

Successful completion of a construction project depends on accurate, effective, and timely communication, formation, and then exchange of critical information among these project team members. To make this happen, elements of the AEC [architecture, engineering, construction] industry have started to move away from traditional communication methods…and have started to rely heavily on online collaboration and project management (OCPM) technology.2

This white paper study will discuss what it takes to successfully close out a construction project and the importance of utilizing an online collaboration and project management (OCPM) technology in order to produce an organized close-out archive. By outlining the benefits of an OCPM technology during the close-out phase as well as detailing the services that OCPM technology offers, this white paper provides general contractors, subcontractors, architects, engineers, designers, and building owners a better reason to invest in the cutting-edge technology known as OCPM.

The Close-Out Stage

Close-out is the act of managing and administering the completion of a project, including preparation and coordination of the necessary documentation in order to facilitate the effective operation of a project. A project close-out consists of:

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 Punch list formulation;

 Operation and maintenance manuals (O&M) and instructions including,  Product care instructions,

 Product warranties;

 Releases of liens from all subcontractors;

 As-built drawings and BIM models;

 All construction documents;

 Contract document archives;

 Certificates of final completion;

 Record of all meetings;

 SmartRooms*

 Photos and videos, including training videos;

 Contact information;

 Project closeout report3.

The AEC industry consists of a wide variety of different types of projects, all of which must finish with a close-out document.

Chart 1 displays all construction projects within the AEC industry that reach a close-out stage upon completion4.

Chart 1: Construction Projects in the AEC Industry to Close Out

Aberdeen Group Study, 2010

__________________________________ 3

List compiled from various sources including: "Design Professional's Guide - Construction & Closeout." Dormitory Authority of the State of New York. NY.gov. Web. 31 Mar. 2011. <http://www.dasny.org/construc/dcg/section7.php#supersearchresult>, "Project Close-Out Phase." Kascon Inc. Web. 31 Mar. 2011.

<http://www.kasconinc.com/closeout.htm>, "Stage 6 - Project Stages." Betts Townsend - Construction Project Management. Betts Townsend Ltd., 2010. Web. 31 Mar. 2011. <http://www.bettstownsend.co.za/our_services/project_stages_stage6.html>.

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Aberdeen Group. “The Impact of Project Management Technology in the AEC Industry.” Meridian Systems. Aberdeen Group, 2010. Web. 21 Mar. 2011. *SmartRooms have been developed by MySmartPlans to provide owners with documentation of every feature included in one particular room of a building.

25%

16%

14%

13%

12%

8%

7%

5%

Commerical Facility

Industrial/Plant

Commerical Retail

Roads & Bridges

Water & Sewer

Residential

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MySmartPlans: Using OCPM Technology for Construction Close-Out| 3 Close-out is the most prominent stage in the AEC industry. According to a study conducted by the Harvard School of Design, 23% of all construction projects are categorized in the close-out stage, the highest of any other stage in the construction process5 (Chart 2).51

Chart 2: Project Status for the AEC Industry

Computer Aided Collaboration in Managing Construction Study, 2006

About OCPM Technology

2

5

Becerik, Burçin. “Computer Aided Collaboration in Managing Construction.” Meridian Systems. Harvard School of Design, 2006. Print.

6

Becerik, Burçin. "Online Collaboration and Project Management Technology: Its Value and Implementation Practices."Meridian Systems. Harvard School of Design, 9 Mar. 2006. Web. 16 Mar. 2011. Path: http://my.meridiansystems.com/downloads/).

23%

21%

17%

16%

9%

3%

3% 2%

Close Out

Planning

Construction

Cancelled

Completed

Bidding

Awaiting Approval

Design

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MySmartPlans: Using OCPM Technology for Construction Close-Out| 4 The most effective OCPM technologies function as dashboards that systematically organize all project information during an entire construction life cycle. OCPM technology is a revolutionary software as a service (SaaS) that has the ability to correlate and update plans, specifications, BIM models, RFIs, ASIs, submittals, as-built drawings, planholders lists, email correspondence, videos, photos, and any additional requested information. In addition, OCPM technology creates a collaborative environment for every individual that is involved in the construction process while simultaneously archiving information for electronic closeout.

The ultimate reason to invest in an OCPM technology is to facilitate transparent and continuous communication among an entire project team—owners, general contractors, subcontractors, architects, engineers, consultants, suppliers, and more—and with the internal staff. In addition, OCPM technology aims to:

 Facilitate construction workflow (RFIs, change orders, submittals, drawings, and specs)

 Create standards, procedures, and policies

 Create a historical archive of information

 Enable information availability and control

 Improve project control and change management

 Provide a competitive advantage for the AEC industry

 Improve efficiency (time and budget)

Chart 3 outlines the individuals or companies that invest in OCPM technology. Chart 4 displays the most relevant users of OCPM technology. In both charts, it can be noted that the general contractor is the biggest investor and user of OCPM technology. The second biggest investor and user is the owner, who is involved most heavily the close-out stage of construction6.

Chart 3: Investors of OCPM Chart 4: Users of OCPM

Online Collaboration and Project Management Technology Study, 2006

33%

20%

14%

12%

8%

7%

4%

2%

General

Contractors

Owners

Construction

Management

Architects

Engineers

Subcontractors

Consultants

Design/Builders

63%

28%

4%

1%

General

Contractors

Owners

Construction

Management

Consultants

Subcontractors

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OCPM Technology in Close-Out

Using OCPM technology during the close-out stage of a construction project is highly effective. Not only does the

implementation of OCPM keep the out stage more organized, but it also allows for greater forecasting before the close-out takes place, accurate performance measuring, easy RFI archiving, and beneficial location of data and information. Additionally, utilized OCPM technology generates a faster release of retainage, saving construction clients both time and money.

Chart 5 outlines the most common uses of OCPM technology. Note that five of the nine uses are active in close-out (contract and change management, document management, portfolio management, collaboration, and executive dashboards and reports.)73

Chart 5: Uses of OCPM Technology

Utilizing Construction Management Technology to Create Best-in-Class Organizations, 2011

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"Utilizing Construction Management Technology to Create Best-in-Class Organizations." FMI Management Consulting & Investment Banking (2008): 1-22. Meridian

Systems. Web. 29 Mar. 2011. http://my.meridiansystems.com/downloads/.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

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Forecasting Tool

Because the goal of a construction project is to get to the close-out stage, a forecasting tool can be effectively utilized in order to predict when close-out will be reached and whether or not it will be reached within budget. Forecasting includes budget (current, pending, estimated, adjustments, projected) and commitment (original, approved revisions, pending revisions, estimate to complete, anticipated) predictions.

Performance Measuring

OCPM technology allows for the review of project performance as well as individual performance. As performance measuring is implemented into the OCPM system, investors and owners have the ability to measure current performance against past performance. With these assessments, the investor or owner can then reward some contractors with more projects and reduce the workload of others8.

Document Management/Location of Documents

OCPM technology has document and process management features such as built-in viewers, auditing and

processes/documents supported, reporting, sorting and redlining drawings, version control and more and can be used effectively in the close-out stage of a project. Most importantly, OCPM technology organizes all operation and maintenance manuals, warranties, as-built drawings, RFIs, photos and videos, certificates, and all documents from the construction process. Because of the incomparable organization of an OCPM, all individuals and companies involved in the building of a project are granted quick access to agendas, project information, contact information, as well as the names of experts on the job. According to Burçin Becerik, the organization of OCPM technology allows for much more than just that. “The OCPM tool eliminates the disconnected silos of project data, enabling all team members to see the latest version of the files and fostering better teamwork. The tool provides the flexibility to execute a project globally when users are in different locations and time zones9 .4

SmartRooms

OCPM technology also provides client access to SmartRooms. Features such as SmartRooms (branded by MySmartPlans) tie O&M manuals or videos to photographic views and plan sheets. This feature gives OCPM technology clients a visual environment to attribute to their finished project. SmartRooms provide specific details to each room constructed in a particular project.

Benefits: OCPM Technology in the Close-Out Stage

The implementation of OCPM technology in a construction project has tangible benefits, quasi-tangible benefits, and intangible benefits.

Tangible benefits: benefits that can be measured in terms of money.

Quasi-tangible benefits: benefits that focus on improving the efficiency of an existing organization.

Quasi-tangible benefits are quantifiable but difficult to measure.

Intangible benefits: benefits that focus on improving the effectiveness and performance of an organization.

Intangible benefits are not quantifiable and cannot be measured.

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Becerik, Burçin. "Online Collaboration and Project Management Technology: Its Value and Implementation Practices."Meridian Systems. Harvard School of Design, 9 Mar. 2006. Web. 16 Mar. 2011. Path: http://my.meridiansystems.com/downloads/.

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Becerik, Burcin. "Identification and Measurement of Online Collaboration and Project Management Systems’ Value."Meridian Systems. Harvard School of Design, 2005. Web. 29 Mar. 2011. Path: http://my.meridiansystems.com/downloads/.

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MySmartPlans: Using OCPM Technology for Construction Close-Out| 7 Specific benefits from the use of OCPM technology during close-out of a project are listed below. These benefits are restricted to the AEC industry.

Information Management and Documentation

Utilization of OCPM technology allows for the archiving of accurate and timely information, making data available to all individuals involved in the project. OCPM technology also quickens reporting and feedback, improves inventory management and decreases information bottlenecks. Information management and documentation also allows for the archiving of finish schedules, which are critical for maintenance of a building.

Version Control and Change Management

Although most change management instances occur in the construction phase rather than in close-out, OCPM technology can document these changes so that they are readily available upon completion of the project. This allows for better

project/program control, a timely capture of design and construction decisions, more accurate forecasting, and improved process automation (RFIs, change orders, auto-updated master budgets, etc.).

Public Relations and Customer Satisfaction

OCPM technology can not only be used as a competitive advantage during the bidding phase, but also during the close-out phase. OCPM has been noted to improve project relationships with strategic partners, enhance the company image, and allow for stronger customer relationships, which in turn, generates repeat business. In addition, AEC companies with OCPM technology are 44% more likely to measure customer satisfaction10. Because OCPM technology is used as a collaborative tool, companies who utilize the software can cooperate more effectively with partners for a much more enjoyable close-out. 5

Efficiency

In the construction phase, OCPM technology improves day-to-day efficiency. Because of OCPM technology, the AEC industry has noticed a faster launch to market, faster delivery lead times and early occupancy trends. In a 2010 Aberdeen Group Study11, it was found that AEC companies using OCPM technology were able to deliver projects within plus or minus seven days of its forecasted date. AEC companies without OCPM technology tend to deliver their project milestones plus or minus twelve days.

Competitive Advantage and Repeat Business

Better performance and analysis during close-out can set up an AEC company with guaranteed future projects. OCPM technology allows for better learning experiences within the AEC industry so that companies never make the same mistake twice in the construction or close-out stages.

Paper

The average construction project close-out exceeds 300 pounds in paper, binders and boxes12. Reducing the amount of paper used on a construction project is not only beneficial for its users (storage, handling, cost), but also for the environment. With the implementation of OCPM technology, the pounds of paper used on a project during close-out can be significantly reduced to a thumb drive, an external hard drive or a small number of disks. The reduction of the administrative costs associated with paper and the physical storage of documents can dramatically lower costs and improves manageability and portability of close-out papers. From 300 pounds of paper to one thumb drive; it’s possible with OCPM technology.

10,11

Aberdeen Group. “The Impact of Project Management Technology in the AEC Industry.” Meridian Systems. Aberdeen Group, 2010. Web. 21 Mar. 2011.

12

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Conclusion

OCPM solutions combine the document management and collaboration tools that the AEC industry needs in order to be more efficient, accurate, effective, and productive in the close-out stage. When implementing an OCPM solution in its practices, the AEC industry is taking a step toward better organization of documents, outstanding public relations and customer satisfaction, repeat business, improved efficiency, and reduced costs due to paper. The trends currently taking place in the AEC industry act as proof that the movement toward a more organized, efficient, communication-driven business starts with a cutting-edge solution—that solution is OCPM technology.

References

Aberdeen Group. “The Impact of Project Management Technology in the AEC Industry.” Meridian Systems. Aberdeen Group, 2010. Web. 21 Mar. 2011.

Becerik, Burçin. “Computer Aided Collaboration in Managing Construction.” Meridian Systems. Harvard School of Design, 2006. Print.

Becerik, Burcin. "Identification and Measurement of Online Collaboration and Project Management Systems’ Value."Meridian

Systems. Harvard School of Design, 2005. Web. 29 Mar. 2011. Path: http://my.meridiansystems.com/downloads/.

Becerik, Burçin. "Online Collaboration and Project Management Technology: Its Value and Implementation Practices."Meridian

Systems. Harvard School of Design, 9 Mar. 2006. Web. 16 Mar. 2011. Path: http://my.meridiansystems.com/downloads/. Data Builder, Inc. - Document Management Software. Web. 31 Mar. 2011. <http://www.databuilderinc.com/ecc.shtml>.

"Design Professional's Guide - Construction & Closeout." Dormitory Authority of the State of New York. NY.gov. Web. 31 Mar. 2011. http://www.dasny.org/construc/dcg/section7.php#supersearchresult.

"Project Close-Out Phase." Kascon Inc. Web. 31 Mar. 2011. http://www.kasconinc.com/closeout.htm Sachs, Lisa C. "Successful Project Close Out." CMAA Southern California Chapter 2: 1-4. Print.

"Stage 6 - Project Stages." Betts Townsend - Construction Project Management. Betts Townsend Ltd., 2010. Web. 31 Mar. 2011. <http://www.bettstownsend.co.za/our_services/project_stages_stage6.html>.

"Utilizing Construction Management Technology to Create Best-in-Class Organizations." FMI Management Consulting &

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Creating Chaos-Free Construction

MySmartPlans is a project centric dashboard that automatically organizes all construction project information from bid phase to closeout. This online collaboration and project management (OCPM) technology allows for improved visibility, transparency, organization, and collaboration. By effectively organizing all plans, specs, RFIs, ASIs, submittals, as-built drawings, planholders lists, email correspondence, videos and photos, and client-requested information onto a single project-centric dashboard, MySmartPlans keeps all users on the same page all while staying green and going paperless. With a strong project information management (PIM) team MySmartPlans provides clients and users with access to real people in real time in order to facilitate ease of use and overall collaboration.

MySmartPlans provides a very robust, customized closeout archive. Upon completion of the project, MySmartPlans provides a digital archive containing all of the project documents, photos and videos, including, but not limited to: plans, specifications, as-built plans, O&M manuals, as-as-built finish schedules, and submittals.

MySmartPlans Electronic Closeout features include:

 SmartRooms which can tie O&M manuals or videos to photographic views and plan sheets

 Reduction in stacks of paper and plans

 Quick access to key operational references and manuals

 Incorporation of graphics, videos and photographs into a 50-year ISO standard archive

 Faster closeouts which help ensure retainage is released sooner

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