CONTRACTOR’S QUALITY PROGRAM

Part I – What Are the Characteristics of the Quality Organization

  1. Mission Statement.  Typical statements in mission statements are “best of class”,  “preferential contractor”, “customer oriented” and others indicating that this contractor is better than the competition, has differential advantages to offer to the benefit of its customers.  Yet, very often the president of the company who writes the mission statement is work.   There is a gap between the mission statement and performance.  The role of the president and staff is to plan and develop and then execute in a manner that its representations of its capability equals its actual performance.
  2. QUALITY AS A CULTURE. There are a few construction companies which have been around more than 100 years, some three generations.  Those are the minority – the very small minority.  An evaluation of those companies which have demonstrated sustainability reveals that each has a culture of quality performance at every level and in every function.   
    1. What is CULTURE?  A culture is a way of life of a group of people, of behavior, beliefs, values, attitudes, performance, commitment to improvement,  and which is susceptible of being passed on generationally.  In every sustainable culture there is leadership which personifies it. 
      1. Culture is not cloning.  It is not a bunch of robots, but rather people who believe in doing things right.  This occurs when leadership establishes the values of the company which include developing personnel and properly recognizing and rewarding their efforts; and processes which it continues to improve through the input of its people;  of a customer obsession which is clothed in accountability.
      2. Culture is like a  sports dynasty.  The Owner and general manager are committed to filling the seats in the stadium *every game, year in and year out.  Those seats are filled by customers and in order to fill the stadium every game and every year, the teams must have the best players in the league, well trained and who have a game plan which they work together in making happen.  They are winners and they are proud to wear the jersey of a winning team.  Sustainable companies are of the same ilk and they continue to be able to hire the best employees because the best employees want to join the best franchise. 
      3. iii.Culture is a team sport.  No quarterback wins ball games and no quarterback will want to take the ball without a line that will protect him and receivers who can run the right routes and make the plays that are necessary to win.  Construction is like that.  There is no player in any sport who is unimportant. There is no player in construction who is unimportant.  Try having a clean-up crew that doesn’t do the job or the delivery driver bring spools from the shop, or the payroll clerk.  Each is important and must be properly trained and recognized.
  3. QUALITY IS A PROCESS:

It is management establishes value and direction for the company; it is hiring and developing people;  putting in place the processes that have highest probability of producing success and then executing them while all the while  evaluating how you can do better.  And then having in place a mechanism for that evaluation process. 

  1. QUALITY THEN MEANS QUALITY ORGANIZATION. Quality is not just workmanship, although it is that.  But workmanship is normally just an end result of a quality organization.   The reader is referred to an article by the author entitled Total Quality Management for Construction Contractors.
  1. BOTTOM LINE: A QUALITY ORGANIZATION IS A LEADERSHIP FUNCTION.  Ultimately, a quality organization is a product of the leadership of the company.  So is a mediocre organization.  Ultimately, a company’s low safety rating (EMR) is the result of leadership which may be more interested in bottom line than the safety of its employees. (Interestingly, when a claims consultant is evaluating a claim, the number of safety incidents – we don’t call them “accidents” because they are almost always the result of an intentional  act or foolish neglect – because a well planed project seldom has an “accident”.  So safety performance is a test of a quality project.) Ultimately, the delays on a project may be the result of company leadership trying to keep its cost down by not providing adequate work force or perhaps taking on more work that it has the resources to perform.   On the  other hand, leaders of companies of sustainability realize that the best approach to profitability and sustainability is through the continual development of a quality organization which indeed lives up to and exceeds its boasts in its mission statement or its website.  It is that leadership which develops cultures of quality, in all of its people and all of its processes and in its execution. 

Part II – Built-in-Quality

  1. Inspect and Correct or Built-in-Quality. The construction industry has had a tradition of doing the work and then having it inspected and reams of punchlists issued, and then remediating the work that was done.  This is called “inspect and correct”.   It is also called STUPID because it is a senseless waste of time and money.  On the other hand, there is now a trend toward the concept of BUILT-IN-QUALITY which will be detailed later.  Basically, Built-in-Quality or process of planning the steps to achieve the required outcome, is about as old as the carpenter who would measure twice and cut once.  The built-in-quality approach is used now because it is often specified in contractors (almost all federal and infrastructure contracts as well as a trend toward specifying in commercial contracts.)  But it is also used because it improves productivity, saves time, and is an excellent planning tool.  It is used because it is SMART  and  PRUDENT to do so.  Nevertheless, even when specified, too often it is given short shrift and not effectively implemented.
  2. What Activities Should the Concept of Built-in-Quality Be Applied to?  The foregoing is a discussion of the three step approach to built-in-quality of a given work activity.  But let’s go one step further and list just a few other meaningful activities for building in quality:
    1. Cost Reporting.  If cost reports are inaccurate through intent or otherwise, then being able to have a real handle on productivity is diminished and losses are incurred that could have been prevented or mitigated.  That is one of the reasons for profit fade: inaccurate cost and profit reporting.  A major culprit in the industry. 
    2. Financial Statements.  To prove how many financial statements are incorrect and inflated, just let a recession come along and see how many contractors go out of business because they do not have the financial strength reported on their statements, even audited statements.  If I were a bank or surety president, I would have a rule that the auditors of the construction companies financial records never take ski trips or party with their clients. 
    3. Project Schedules.  If the schedule is to truly be a road map for the team members to follow to attain an on time project, how about having real input from all the members of the team, update it routinely and honestly and completely.  Otherwise, trash it.
    4. Promises.  An underlying thesis of successful project management is the doctrine of reliable promises.  Lean management gurus state that a project is really just a series of promises and successful projects are the ones which are made and kept – reliable promises.  The promise to have a given size crew on the project next week, or to respond to that RFI by the due date, or deliver the equipment when scheduled.   So the quality of promises is a key part of the process.
    5. A fear free environment.  When employees are intimidated for presenting their ideas, or admitting mistakes or miscues, accurate information goes out the window.  Management is really a function of how to use information.  When personnel are fearful of communicating honest and accurate information, then there can be no effective management. 

The point is from these few illustrations, that building in quality relates to every function on a project, not just snapping blue lies on a slab and installing studs and there must be built into each function quality of performance, honest and reliability.    

  1. THREE STEP QUALITY APPROACH. Typical contractual requirements for the three step approach are set forth in the attachment.  The following are principles that should be followed:
    1. Commitment to the concept of built-in-quality.  This gets us back to leadership and company culture.  If the president only gives lip service to safety, for example, the AMR will always be higher than acceptable.  The same is true for quality: leadership must have high standards and develop personnel to attain them.  If I were a president of a construction company, I would continually ask myself the question: “Have I built a quality organization at every level?  Am I doing the best to bring on board quality subcontractors and to manage their quality as well as that of my own troops?  Am I a quality leader?”
    2. Acceptance of accountability.  The contractor may be willing to accept accountability for a minor problem the cost of which to fix is low.  But if the cost is steep, does the contractor attempt to duck his responsibility or accept it and the consequences. 
    3. Communicate to the employees the company value system and its commitment to built-in-quality.   Even new hires or outsourced employees should be fully aware of company values and policies.  Disney has continuous training programs with all of its employees regarding its quality concepts and it has obviously paid off big. 
    4. The subcontractors are involved.  I heard a major general contractor state that it was not responsible for the  quality of a subcontractor’s work.  What bothers me is the number of general contractors who have the same mistaken notion.  In the manufacturing world, companies such as BMW and Coors,  will actually bring in subcontractors and suppliers  to training sessions on Six Sigma, TQM and new technology.
    5. Suppliers are involved. Site visits with fabricators of major components are often very worth while.  The point is, quality is a function of every player on the project and each must be working toward the same goals.   Quality is not limited to the general contractor or the MEP.   The culture of quality should be universal.
  1. The Elements of the Three Step Approach to Built-in-Quality
    1. What are the three steps. Each of these steps should be set forth ih the project schedule.
      1. Preparatory Phase
      2. Interim Phase
      3. iii.Final
    2. Preparatory Phase obviously consists of getting ready to perform the work.  “The work” is a definable activity which normally should be on the CPM. 
      1. The team gets together in advance of the activity, far enough I advance that preparations  and deliveries required can be accomplished.
        1. The acronym PPOIC comes into play
          1. People
          2. Planning
          3. Organization
          4. Implementation
          5. Control
      2. Hopefully, the team will consist of an owner’s representative
      3. iii.The plans and specifications are reviewed:
        1. If there are discrepancies or ambiguities, this is the time to resolve them, not during installation.
        2. Tolerances and basis of acceptance are reviewed to assure clarification of the requirements of the end product.
        3. Have pre-installation requirements (seismic, et al) been met?
      4. Review coordination drawings
      5. Review supply items:
        1. Deliveries
        2. Review of submittals, installation drawings
        3. Required tests accomplished
      6. vi.Review status of precedent work (state of readiness)
      7. vii.Determine tools and equipment required
      8. viii.Resources needed from home office
      9. ix.Means and methods to be used
      10. Crews and crew sizing analysis
        1. Are adequate skilled craftsmen available
        2. How will outsourced personnel be handled
      11. xi.Hazard analysis (for example, work in confined environmentally unfriendly spaces.
      12. xii.Develop productivity goals and targets
      13. xiii.Assure all affected parties, including subs and suppliers are on board
      14. xiv.Special  operations that may be required (eg, cold or hot weather concrete placement)
      15. xv.Lessons from learned from previous type work
      16. xvi.Potential problems and how to cope (use20/20 foresight)
      17. xvii.Inform inspectors of schedule

The point is that the preparatory meeting is a planning meeting.  It is an opportunity for the supervision and others who will be responsible for achieving the goals of this activity have figured out the best approach, get rid of the potential speed bumps. So though it is considered a leg of the quality program, it is actually a stout leg of productivity goal attainment.  It ties all the players into the activity: home office, owner’s representative, subs, supply chain, inspectors.  Everyone is on board.  Owners are sometimes reluctant to attend because they do not want to be accused of dictating means and methods.  There is a simple solution: attend and just not dictate means and methods.  A wise contractor, however, may wish to seek the experience of the owner’s representatives on other similar activities. 

    1. Initial Phase.  There should be equality between that which was planned and that which has been accomplished.  Before the task gets too far along, the idea is to make sure that equality is occurring, and if not, to be able to take corrective measures as soon as possible.  If a quarterback is getting sacked every other play, the coach brings him over to the side line quickly and tries to figure out in real time what the problem is and how to correct it rather than waiting for the game to be lost and evaluate it on the game film.  This is the idea: in real time evaluate how the plan is being implemented, correct if necessary, improve where possible. 
      1. Review minutes of Preparatory Meeting
      2. Check the work  for compliance
      3. iii.Check for potential problems
      4. Discuss solutions for potential problems
      5. Discuss some ways that process can be improved
      6. vi.Seek home office support if required
      7. vii.Are testing requirements being scheduled
      8. viii.Are equipment deliveries on time
      9. ix.Is clean up being performed timely
      10. Are backcharges being avoided
      11. xi.Are conflicts with other crews being resolved
      12. xii.Are conflicts with owner’s representative being resolved
      13. xiii.Are targets being met
    2. Final Phase The real final phase is the process between the initial phase and the completion of the activity; that is, the contractor’s supervisor and quality personnel continue to check on a daily basis to assure that the work is being completed in compliance with the contract; that discrepancies are being completed as discovered; that tests are scheduled, conducted and documented and that all required documentation is being recorded accurately and properly disseminated and maintained.

SUMMARY

I suppose the first time I became aware of the concept of built in quality was from my grandfather who was a  skilled carpenter, and who indeed did measure twice so he only had to cut once.

Then I saw the concept used on a one billion pump storage project at Bad Creek, a Duke Energy project.  A new kid on the block for Duke was made vice president of construction.  The new kid did not have a construction background; in fact he was from human resources.  But for the life of him, he could not understand why extensive punch lists were just accepted in the construction industry, and so he  developed what he called the COMPACT.  A “compact” to him was like a treaty in which the parties would get together and figure out how to do something.  So, for every new definable activity on the project, he brought together the parties who would be responsible for performing it and go through pretty much the items listed above.   Each party committed to  performing those things over which he had control (the idea of “reliable promise”).  And of course there was surveillance to assure the various goals and targets were attained and believe it or not the project completed ahead of schedule and under budget, in large part because of the intensive planning and commitments during the various compact meetings.   All because a non construction guy did some thinking outside the box.

Then Naval Captain Joe Hedges pushed this concept in all their procurements and of course it is now a staple with the COE as well.

My own observation is that it remains a great arrow in one’s arsenal but remains underused.   Considering that construction productivity has basically remained stagnant over the last thirty or so years, it might be a good idea to not only think out of the box, but maybe to get outside it.