partnering innovationsSFO Shines On Terminal 3 East

page 8On-Time,

On-Budget

INSIDE:page 14

Bumping it Up with a DRL

Issue 1March/April 2014

2 Partnering Magazine March/April 2014 www.partneringinstitute.org

World-Class Innovators. Landmark Bui ldings. Inspir ing Per formance.

EVERY SUCCESSFUL PROJECT BEGINS WITH A STRONG

PARTNERSHIP.

At Hensel Phelps, our high performance teams understand the importance of integrating our client’s vision with the design and construction of their project.

It requires a synthesis of effectively managed professionals that understand working in a team environment with one overriding goal: to provide the best value, on time and on budget.

For more information scan this code.

hens

elph

elps

.com

www.partneringinstitute.org March/April 2014 Partnering Magazine 3 3

INTERNATIONAL PARTNERING INSTITUTEIPI is a non-profit 501(c) 3 charitable

organization that is funded by our

members and supporters who wish

to change the culture of construction

from combative to collaborative.

Phone: (925) 447-9100

BOARD OF ADVISORSJohn Martin, San Francisco International Airport

Larry Anderson, Salisbury University Center

for Conflict Resolution

Pierre Bigras, PG&E

Roddy Bogus, Parsons Brinckerhoff

Larry Eisenberg, Ovus Partners 360

Michael Ghilotti, Ghilotti Bros, Inc.

Richard Grabinski, Flatiron West, Inc.

Dan Himick, C.C. Myers, Inc.

Randy Iwasaki, Contra Costa Trans. Authority

Mark Leja, Caltrans

Pete Matheson, Granite Construction

Geoff Neumayr, San Francisco International

Airport

Jim Pappas, Hensel Phelps Construction Co.

Zigmund Rubel, Aditazz

Ivar Satero, San Francisco International Airport

Stuart Seiden, County of Fresno

Todd Sutton, Skanska Civil, USA

David Thorman, CA Div. of the State

Architect, Ret.

Len Vetrone, Webcor Builders

Curt Weltz, Walsh Group

EXECUTIVE DIRECTORRob Reaugh, MDR

CEOSue Dyer, MBA, MIPI, MDRF

EDITORIAL OFFICE: SUBSCRIPTIONS/INFORMATIONInternational Partnering Institute

291 McLeod Street

Livermore, CA 94559

Phone: (925) 447-9100

Email: ed@partneringinstitute.org

www.partneringinstitute.org

DESIGN/CREATIVEMichelle Vejby

Email: mvejby@msn.com

COPYRIGHTPartnering Magazine is published by the

International Partnering Institute, 291 McLeod

Street, Livermore, CA 94550. Six bi-monthly

issues are published annually. Contents

copyright 2014 International Partnering

Institute, all rights reserved. Subscription

rates for non-members, $75 for six electronic

issues. Hard copy issues are available

only to IPI members. Additional member

subscriptions are $75 each for six issues.

Postmaster please send address changes to

IPI, 291 McLeod Street, Livermore, CA 94550.

IN THIS ISSUE

4Executive Director’s ReportPromoting Culture Change

7Committee SpotlightThe Facilitator Professional Emphasis Group (PEG)

14Research RoundupConflict is more costly than you think—use partnering strategies to reduce the cost of conflict.

16Facilitator’s CornerUse your project’s dispute resolution ladder when your team gets stuck.

18CEO’s MessageTransform how you work together—Your intentions count!

CONTENTS

FeaturesMarch/April 2014 Partnering Innovations

Enhance Your Partnering with EIThe link between emotional

intelligence and earnings.

6

Partnering InnovationsFind out how SFO successfully

integrates partnering into their

innovative solutions and comes out

on top, on time, and on budget.

10

On-Time, On-BudgetThere is no doubt that the

construction industry needs to

become more collaborative.

8

World-Class Innovators. Landmark Bui ldings. Inspir ing Per formance.

EVERY SUCCESSFUL PROJECT BEGINS WITH A STRONG

PARTNERSHIP.

At Hensel Phelps, our high performance teams understand the importance of integrating our client’s vision with the design and construction of their project.

It requires a synthesis of effectively managed professionals that understand working in a team environment with one overriding goal: to provide the best value, on time and on budget.

For more information scan this code.

hens

elph

elps

.com

Cover photo of SFO Terminal 3 East,courtesy of Gensler, www.gensler.com,(and Joe Fletcher Photography).

4 Partnering Magazine March/April 2014 www.partneringinstitute.org

get.” When you work with

IPI, this becomes especially

true. There are many ways to

get involved. Just let us know

what it is you need and we

can get you “plugged in.” We

consistently see members,

like SFO, who have found

Collaborative Partnering to

be the process that greatly

increased their level of

project success. We want

that for you too!

Thank you for being a part

of IPI. You are an essential

part of accomplishing our

mission—to change the

culture of construction from

combative to collaborative.

We encourage you to share

Partnering Magazine

with your staff, boss, and

colleagues. Together we can

make structured partnering

and collaboration the norm

for construction projects.

Sharing Best Practices

Promotes Culture Change

partnering to a new owner.

We are proud to kick off

the magazine by focusing on

“Partnering Innovations.”

In this issue we feature an

outstanding project recently

completed by one of our

Founding Members, the

San Francisco International

Airport (p. 10). With the 68,800

SF Terminal 3 Boarding Area

East (BAE) Project, SFO and

the Hensel Phelps, Gensler

and KPA Group have delivered

again. Many have been asking

how they consistently deliver

extraordinary results. In

this issue we highlight 3 of

the “Keys to Success.” This

issue also includes some

practical advice for how

to best use your Dispute

Resolution Ladder (p. 16).

We highlight two new pieces

It is with great

excitement that IPI is

launching Partnering

Magazine. Partnering

Magazine represents a

new way for IPI to share

Collaborative Partnering’s

best practices, lessons learned,

research and ideas to help

our members be better able to

create a culture of partnership

on their projects. In each issue,

we will tap into the collective

wisdom of our members

along with those inside and

outside of the industry who

can help us take partnering to

the next level. Our goal is to

arm you with practical ways

to make you a better partner

—regardless of whether

you are a Project Manager

leading weekly meetings, or

an executive trying to “sell”

of research: the first focused

on Emotional Intelligence (p.

6) and the second describing

how expensive day-to-day

conflicts can be on the job site

(p. 14). We are also pleased

to announce the launch of

our new IPI Professional

Partnering Facilitator

Certifications (p. 6).

The certifications were

developed so you will know

that people with the IPI

designation have a proven

level of ability. This should

allow you to confidently

select the best Facilitators

for your projects.

Partnering Magazine is

for you. It is here to serve

your needs. We invite you to

participate by sharing your

success stories, questions,

thoughts, and lessons learned.

There is an old saying,

“what you give is what you

EXECUTIVE DIRECTOR’S

REPORT

Rob Reaugh, MDR

IPI Executive Director

usa.skanska.com

Collaboration. Innovation. Sustainability.Partnering to build a better future for our customers and communities.

James B. Hunt Library, North Carolina State University

George Bush Intercontinental Airport, Terminal B Redevelopment, Houston TX

2013 NAIOP Community Enhancement Day, Seattle, WA

Gold Line Bridge, Arcadia, CA

6 Partnering Magazine March/April 2014 www.partneringinstitute.org

PARTNERING IN THE

TRENCHES

Using Emotional Intelligence to Enhance Your PartneringIn an article published in February

2014 for the American Society of

Civil Engineers, IPI member Mark

Cacamis, State Construction Engineer,

Virginia Dept. of Transportation, and

Mounir El Asmir, Assistant Professor,

School of Sustainable Engineering

and the Built Environment, Arizona

State University, make the case that

emotional intelligence can improve

your partnering effort. In the article

the authors say that, by improving the

emotional intelligence capabilities of

project team members, you can improve

your partnering effort and improve your

overall project results. To support their

argument, the authors did a random

study of eight of the Virginia DOT project

managers who had a reputation for

having good projects. They found that

each of the eight PMs had an emotional

intelligence score that ranged in the

very high (6 out of 8) or higher than

average (2 of 8) levels!

So, what is emotional intelligence

and how might you use this to help your

partnering effort?

The concept of emotional intelligence

has been around since the 1960’s but

became mainstream in 1995 with

the publishing of Daniel Goleman’s

book Emotional Intelligence – Why it

can matter more than IQ. Goleman’s

model outlines five main emotional

intelligence’s:

1. Self-awareness – the ability to know

one’s emotions, strengths, weaknesses,

drives, values and goals and recognize

their impact on others while using gut

feelings to guide decisions.

2. Self-regulation – involves controlling

or redirecting one’s disruptive

emotions and impulses and adapting

to changing circumstances.

3. Social skill – managing relationships

to move people in the desired

direction.

4. Empathy – considering other people’s

feelings especially when making

decisions.

5. Motivation – being driven to achieve

for the sake of achievement.

It is believed that emotional

intelligence can be learned, or at

least improved. There are several

instruments for measuring emotional

intelligence in individuals. By improving

in these five areas it stands to reason

that our team members would be better

equipped for the complex world of

construction projects.

Call for FacilitatorsIPI Facilitator Certifications Are Now AvailableFor some time now IPI members have been asking for a Professional Facilitator Certification. The need is to be able to identify those facilitators who have a good level of ability. The Board of Advisors along with the Facilitator Professional Emphasis Group (PEG) have developed a performance based certification process with three levels of professional certification—Certified, Senior, and Master levels.

By using a performance based approach, certification is earned after performing a given number of partnering sessions. This process allows the marketplace to be the indicator of proficiency. Thus indicating that the facilitator was good enough to be hired numerous times. It was decided that a “test” or “classroom” based certification was not the best indicator of ability.

The certification process requires a listing of the projects for which the facilitator was the professional facilitator, along with sharing the Partnering Charter, and contact information. There is also a requirement for an owner and contractor to provide a letter of recommendation. To become certified a professional facilitator must have successfully performed 25 partnering sessions. For Senior level, the requirement is 100 sessions; and for Master level the requirement is 250 sessions. Professional Partnering Certification also requires that you be a member of IPI, and there is a fee of $250. For more details and information please contact the IPI office or send an email to ED@PartneringInstitute.org

The first IPI Certified Professional Partnering Facilitators will be honored at the May 15th IPI Partnering Awards ceremony.

ei EmotionalIntelligence

• The average salary of people with a high degree of EI is $29,000 more per year than people with a low degree of emotional intelligence.

• The link between emotional intelligence and earnings is so direct that every point increase in emotional intelligence adds $1,300 to an annual salary.

Source: TalentSmart

EmotionalIntelligence

• The average salary of people with a high degree of EI is $29,000 more per year than people with a low degree of emotional intelligence.

• The link between emotional intelligence and earnings is so direct that every point increase in emotional intelligence adds $1,300 to an annual salary.

Source: TalentSmart

www.partneringinstitute.org March/April 2014 Partnering Magazine 7

COMMITTEE SPOTLIGHT

must be an adequate pool of professional, seasoned partnering

facilitators who can act as the change agents for partnering

programs and projects. This is why we want to work to make

the Professional Partnering Facilitator a profession.

The IPI Facilitator PEG is chaired by Jim Eisenhart, Ventura

Consulting and Sue Dyer, OrgMetrics. The Facilitator PEG

meets every six weeks. All professional facilitators are invited

to participate.

Next up will be the implementation of a Mentor/Protégé

process that will marry Senior Certified facilitators with

aspiring facilitators. And, the development of a Facilitated

Dispute Resolution Facilitator certification criteria and process.

The Facilitator Professional Emphasis Group (PEG)

The IPI Facilitator Professional Emphasis Group, or

PEG, is a place where professional facilitators come

together to share their perspectives, knowledge and

lessons learned with one another and IPI. Members of the

PEG include professional partnering facilitators from all

over the US, Canada and Sweden. The purpose of the PEG

is to tap into the collective wisdom of the facilitators who

participate in hundreds of projects all over the country

and beyond. So far the PEG has focused on developing

an IPI Facilitator Code of Ethics and they created the IPI

Professional Partnering Facilitator Certification levels

and process (see page 6 for more information).

The professional partnering facilitator is an essential

element in the process of developing culture change. There

IPI Launches Collaborative PartneringOrientation Training

IPI’s Collaborative Partnering Orientation Training was

born out of the many requests received for an introduction

to IPI’s Collaborative Partnering Model. As more owners

are adopting the model there was a need to provide an

overview to their team members. This half-day orientation

training presents a summary of the Collaborative Partnering

Model. The training is designed to help answer questions

that your team will likely have as you begin to implement

the Collaborative Partnering Model. It can also be helpful

if you want to influence others to use the Collaborative

Partnering Model. You will be armed with a better overall

understanding of what the model is, why it is needed, and

how it works.

The training includes a review of the vertical and

horizontal Collaborative Partnering matrices. These outline

the Collaborative Partnering Program elements that are

needed/required, based on the risk level of your project. The

training will walk you through the Collaborative Partnering

Specifications so you can choose the best spec for each

project and understand the roles and responsibilities of the

project team members and stakeholders. An experiential

element is also included where the participants will explore

ways they believe increased collaboration could benefit

their projects.

This training can accommodate up to 30 attendees per

class. IPI members’ experiences show that making training

required proves to be highly effective in contributing

significantly to the success of their partnering programs.

For best results you will want to include people from the

owner, contractor, designer and construction manager.

This will allow for a shared learning experience, aligned

expectations, a common vocabulary along with learning

about each others’ point of view. To schedule training(s) for

your organization’s teams, give IPI a call at (925) 447-9100 or

email ED@PartneringInstitute.org.

8 Partnering Magazine March/April 2014 www.partneringinstitute.com

BEST PRACTICES

On-Time,On-BudgetHow to start a Collaborative Partnering Program

To assist owners in starting their Collaborative Partnering Program, IPI has just published a new Owners’

Guide entitled On-Time On-Budget: How to Start a Collaborative Partnering Program. This easy to read

guide walks owners through ten steps to starting their Collaborative Partnering Program (CPP).

Step 1 Decide to start a collaborative partnering programThe first step is to decide to start a CP program and commit to making it happen. It is also important

to understand what it is you want to achieve—lower prices, no claims, improved productivity, keeping

your good people, etc. What do you want to achieve with your CPP? Knowing this will help you “sell”

everyone on following you to achieve tangible results.

Step 2 Agree to utilize the IPI matrices and specificationsFollowing the CPP structure (embedded in the matrices and specifications) is essential to supporting the

development of a culture of collaboration. Taking a long term view is essential. Culture change will not

happen overnight. It will take time. When change happens on your projects, others will take note and

wonder how they are able to accomplish such significant results. This will lead to others learning and

following the CPP structure, looking for similar results.

T here is no doubt that the construction

industry needs to become more collaborative.

We lose billions of dollars each year due to

loss of productivity, miscommunication, excess

administration and claims. All of these dollars

could be used to build things. Worse yet, is that the

nature of construction is highly interdependent.

Because of our interdependence, no one working

on a construction project can just walk away from

issues and succeed. We must have the cooperation

of the other team members, who hold our success in

their hands, as much as we hold it in our own. This

is why IPI has created the Collaborative Partnering

Program—a structured approach to developing

highly collaborative construction project teams

focused on the success of their projects. “Change will not occur

if you don’t change.

People don’t like to

change.”

www.partneringinstitute.org March/April 2014 Partnering Magazine 9

Step 3 Conduct orientation trainingYour people must know what you are trying to accomplish, that you are

serious, and broadly what they are to do. The IPI CPP Orientation Training

is essential to help support a good launch to your program. This training is

best held jointly including the owner, contractor, users, designer and other

key stakeholders. Together the counterparts learn about the CPP model, your

objectives and what is expected. This will help you get some momentum going.

Step 4 Hire a partnering program consultant to assist and guide your culture change processMost organizations just “smell their own exhaust” and really don’t

understand where they are dysfunctional. You will need a “change agent.”

Someone who is not a part of your organization; is a subject matter expert;

has much experience with the CPP and culture change; and is someone you

will allow to help guide you on this journey. Change will not occur if you

don’t change. People don’t like to change. You will need a strong (but kind)

change agent that is on the outside!

Step 5 Appoint staff and create a structure to support your collaborative partnering programYou are embarking on a culture change effort that will play out on your

projects and within all of your support functions. You will need to have a

CPP organizational structure, up and down the organization, to help you

achieve your results. This can include having a Partnering Program Manger

to help make sure all of the program elements get implemented, to having

representatives from the field level provide feedback, to having a policy making

body. You will need to put some structure around your culture change process.

Step 6 Develop a collaborative partnering steering committeeA very powerful step is to develop a Collaborative Partnering Steering

Committee to identify barriers to partnering and then work to overcome

each barrier. This policy making body includes senior level decision

makers from the owner organization and construction industry, as well as

representatives from designers and CMs. It will be the collective wisdom

of this group that helps to steer you where you need to go.

Step 7 Develop a collaborative partnering project manualAt the project field level, you will want to create a project partnering manual

to guide the field teams on what they are to do to fully implement your

partnering program. The guide can be updated as the steering committee

changes policies or learns better ways of producing more significant results.

Step 8 Provide joint collaborative partnering basics training (on the project manual) to all field personnelOnce your partnering manual is completed, you will want to provide

training to everyone in the field on the guide. This is called Partnering

Basics Training. This 4-8 hour training outlines, roles, responsibilities,

requirements, elements along with answering the question why you are

establishing a CP program.

Step 9 Develop performance measures (program and project)What gets measured gets done. What gets

measured improves. If you believe these

tenants, then you will definitely want to develop

performance measures for your program to

get regular feedback on what and how much is

improving. For your projects you will want to

measure that the team is following through with

what they committed to doing. This accountability

will keep their goals and commitments fresh in

front of their faces each month.

Step 10 Develop a participate in partnering recognition programs and awards Recognizing those who are making it happen is

important. You can start your own, or participate

in IPI’s prestigious partnering awards. By

celebrating the successes of your teams that

accomplished their goals, and became a highly

functioning collaborative team; you will be

broadcasting your commitment to culture change.

As people advance within your organization

because they know how to create a culture of

collaboration, you will be on your way to real,

lasting culture change.

IPI’s new Owners’ Guide entitled On-Time

On-Budget: How to start a collaborative partnering

program is now available. Just email ED@

PartneringInstitute.org to get your copy, or to get

copies to share with those organization whom you

wish would establish a CPP. One copy is free for

each IPI member.

10 Partnering Magazine March/April 2014 www.partneringinstitute.org

An Exceptional Project Outcome for SFOTO SFO, AN EXCELLENT PROJECT

OUTCOME (EPO) DESCRIBES A PROCESS,

WHICH GIVES ALL STAKEHOLDERS A

VOICE AND FULLY INTEGRATES EVERY

PROJECT TEAM FROM THE PROJECT

EXECUTIVES TO THE FIELD LEVEL

The San Francisco International Airport (SFO) and their design-build partners Hensel Phelps, Gensler and

KPA Group have done it again! The newly rehabilitated $138,000,000 and 68,800 square foot Terminal 3 Boarding Area East (BAE) project has raised the bar in terms

of elegant design combined with a unique experience for United Airlines Passengers. What is perhaps most incredible about the new boarding area was how the project team was able to vision, plan, design, construct, and activate the new Terminal in just over 18-months, and managed to deliver it on time, under budget, and safely (no LT injuries). Other Airports have taken five years to deliver this type of project, but through Collaborative Partnering, the team delivered an Excellent Project Outcome (EPO).

Over the past 18 years, the Airport has delivered more than $800 Million of work without any claims. Construction programs world-wide are seeking them out to learn how they are so consistently raising the bar with each and every project, while remaining true to the core values of highly collaborative teams. What are they doing and how can you apply it to your projects?

Three Keys to Success In order to ensure an EPO on highly complex projects, SFO implements the see three “Keys to Success” that make the SFO program so consistently successful:1. Executive Commitment to a

Collaborative Culture 2. A Collaborative Partnering Program

with a Multi-tiered Approach3. A FAST Way to Tap into Stakeholder

Knowledge and Expertise

Key to Success #1: Executive CommitmentLike any process focused on changing a culture, Collaborative Partnering requires executive commitment. Notes Hensel Phelps VP Jim Pappas, “Airport Director John L. Martin’s faith and commitment to Partnering empowers his management team to view their role as collaborators

PARTNERINGINNOVATIONS

www.partneringinstitute.org March/April 2014 Partnering Magazine 11

set of goals, it is essential to use a highly structured process. Remember, the objective is not solely to reduce conflict within the design/build team. Instead, an Excellent Project Outcome requires that the entire team (Owners, Tenants, IT Special Systems subs, the concessionaires, everyone) feel that they have a voice, have a stake in the outcome, and have bought in to the project. Furthermore, the structure must allow the team to interact with adjacent projects, so throughout the construction phase, the team is prepared to handle any issue that may arise. The result is that when it comes time to open the Terminal building to the travelling public, the entire team is realizing a “shared vision.”

In order to develop a fully-integrated team for the BAE project, the Executive Team committed to a partnering structure that had several levels to it. Below we share the roles of each “Level” and the frequency of the meetings. All of the sessions were professionally facilitated.

• Executive Level: C-Level project leaders, who steer the Terminal 3 Program from a 40,000 foot level. They commit to key milestone dates and goals for the project and meet quarterly to discuss all of the projects involved in the program (Boarding Area E, Terminal 3 East Mod 4, and the Concessions).

• Core Level: The Project Level “steering team” (PM’s, Superintendents, key exec’s etc.) who are the key decision-makers on a day-to-day basis for the project. In design, this group meets quarterly and during the heat of construction, meets monthly to identify and research risks and negotiate resolution to issues in real time.

rather than enforcers.” Too frequently in our industry, PMs have been taught to “protect the Owner’s interests,” but experience and research have shown that this develops adversarial project teams, which tend to posture and lack trust. Instead, Executives commit to the full Collaborative Partnering Process for SFO’s projects. For Executives, this involves attending quarterly Terminal 3 Program Level Partnering meetings and filling out monthly scorecards. Further, they frequently attend monthly sessions and hold their team accountable to actively participate by speaking up and sharing concerns, rather than hiding problems. This Executive Level commitment gives the entire team confidence that they have a voice and can trust that they will be rewarded for telling the truth, rather than punished for sharing bad news.

Key to Success #2: Partnering a Program with a Multi-Level ApproachTo ensure that more than 100 organizations involved in the design, construction, and activation of the facility (each with their own culture), become focused on a single vision and a single

“The Partnering Scorecards provided a safe way for project team members to be heard, while allowing the management team to take the pulse of the project, monthly.”

— Judi Masqeuda, SFO PM

Recent SFO Partnering Projects:• Terminal 2

• Secure Connector

• Building 575

• Boarding Area East

• Replacement Air Traffic

Control Tower

• Baggage-Handling

Systems Modernization

• Runway Safety Area

(RSA)

Photos shown below of SFO Terminal 3 East: (left) courtesy of Gensler, www.gensler.com, and Joe Fletcher Photography; (right) courtesy of photographer Joseph Driste.

12 Partnering Magazine March/April 2014 www.partneringinstitute.org

PARTNERINGINNOVATIONS

• Stakeholder Level: The key project influencers and end-users, who often have great insights into how to best design and construct the facility. By being engaged with the partnering process, they can raise issues, share “know-how” and identify common mistakes that have haunted similar projects. They meet quarterly.

Key to Success #3: A FAST Way to Tap into Stakeholder Knowledge and ExpertiseFor SFO to organize and integrate the over 100 organizations involved in a Terminal project, they use Focused Action Strategic Teams (FAST) (formerly known as QRTs). Each large project will have roughly 36 “FAST” teams assembled for each critical airport terminal system (i.e. Special Systems, Airlines Operations/Coordination, Art Program, etc.). Each FAST includes a system Owner (SFO Rep), a User, a Maintainer and Reps from the Design/Build team. The role and the composition of FASTs will change throughout Planning, Design, Construction, and Activation. In planning and design, the FASTs answer questions and explore issues that may arise with design. Later in the project, according to Hensel Phelps Operations Manager Todd Temple, “FAST teams could be recalled to help with special issue resolution when we needed stakeholder input. When the team agreed to adding a

second elevator to the project in early 2013, we had to re-design the foundations, structural steel, exterior cladding, roofing and reroute the electrical and other key building systems. This was a $1.5 million change and could have added months to the schedule without such a collaborative process in place.” For SFO’s teams, the FAST process helps produce a high level of integration and results in stakeholders and end-users who are fully vested in the facility once it is finally built.

By implementing these 3 Keys to Success: Executive Commitment, a Multi-Level Approach, and the FAST process, SFO and the Hensel Phelps, Gensler and KPA Group team delivered yet another highly complex project on time and under budget! Boarding Area E is a breathtaking facility that has once again raised expectations for how domestic travelers experience the too-frequently stressful hours as we wait for our flight to depart.Great work!

Take a look at these two photos above: on the left is the jobsite of BAE on December 13, 2012; on the right is the terminal on December 6, 2013. It is truly remarkable how much work got done in just one year (photos courtesy Hensel Phelps Construction Co.).

14 Partnering Magazine March/April 2014 www.partneringinstitute.org

RESEARCHROUNDUP

The Cost of Conflict

“Partnering is the perfect forum

for unearthing emerging conflicts.”

In December 2012, Julie Brockman,

Ph D. of Michigan State University

published a study entitled “The

Interpersonal Cost of Conflict in

Construction.” In a study of 41 jobsite

conflicts, they found that on AVERAGE,

161 hours (~20 days) were spent

attempting to manage each conflict.

When they analyzed those work

hours spent on managing each conflict

they found that each conflict cost an

AVERAGE of $10,948.00!

I am sorry to be the one to break it

to you, but conflict is Really Expensive!

This study, funded by CPWR—The

Center for Construction Research and

Training, is the first of its kind, where

they assigned time and monetary value

to conflicts that arose on actual jobsites.

Overall, Brockman interviewed

74 industry personnel from various

trades using a methodology that would

elicit descriptions of conflict incidents.

Ultimately, her interviews revealed 86

incidents, of which, 41 were analyzed.

www.partneringinstitute.org March/April 2014 Partnering Magazine 15

As one of North America’s largest transportation and infrastructure contractors, our commitment to building the best is demonstrated in the projects we build and the partnerships we develop. Our success is dependent upon our relationships with owners, partners, designers, subcontractors and community members. Flatiron works closely with our partners to develop innovative solutions that benefi t everyone, and we’re proud of what we’ve created together. The more than 20 partnering awards Flatiron has won in the past decade serve as recognition of these relationships and

the resulting successful projects.

To learn more about Flatiron’s innovation in partnering visit

www.fl atironcorp.com

Interstate 880/State Route 92 Interchange Reconstruction

Hayward, CA

2012 IPI Partnered Project of the Year, Diamond Level

The 41 conflicts analyzed were assigned a “cost” in terms of lost

time and lost money based on time spent involved in managing

the conflict. To give you a sense of scale, the shortest conflicts in

the study lasted about 30 minutes. The longest involved 6,000

hours (750 days of work), and cost $367,000! And this is just the

lost time tied directly to the dispute. It does not take into account

the reduced productivity, increased absenteeism and employee

turnover that often result from these types of conflicts.

The chart “Sample Cost of a Field Conflict” (p. 14) shows

how the study assigned cost and time to a conflict. In this case,

Worker A refused to lay a pipe the way his co-worker (Worker

B) wanted him to. After arguing for half an hour, Worker

B reported Worker A to his Supervisor. Ultimately, because

Worker A refused to change his methodology and kept fighting

back, his Supervisor replaced him with Worker C. After Worker

A was removed from the jobsite, his Supervisor continued

working with him and counseling him for five months to

improve how he worked with his peers.

This type of conflict and intervention, which happens

fairly regularly, would represent more than 100 hours of

time lost and more than $5,000 spent in lost productivity.

Dealing with conflict is an important skill for any manager.

But in an adversarial industry like construction, it becomes

essential. Our Project Managers and Field Superintendents

need to learn how to handle disagreements within their own

team (like in the case here) and also need to be able to work

across the table when they have disagreement with their

counterpart over a potential claim.

Partnering is the perfect forum for unearthing emerging

conflicts like the above pipe laying issue. It also is an

opportunity for managers to get together and set up systems

for effectively negotiating issues before problems inevitably

arise in the field.

The end result is that conflict hurts your bottom line.

Investing in partnering is a great way to help reduce

conflict and improve your job culture from the outset, so

disagreements can be handled in the same shift, rather than

drawn out over the length of the project. Last year, IPI Award-

winning projects told us that $1 spent on partnering saved the

project $93. It’s a better way to spend your money and time.

Thanks to IPI Member Neal Flesner of Ventura Consulting

Group for Sharing the “Cost of Conflict Study” featured in

this article.

16 Partnering Magazine March/April 2014 www.partneringinstitute.org

FACILITATOR’S CORNER

Impasse is normal. Every day on the job site we have disagreements

and it is common for Owner and the Contractor reps to interpret

specifications or site conditions differently. But how does your team

respond to these issues?

Research has shown us that it is important to resolve issues early enough

to insert technical solutions before a delay will affect the schedule. Great

teams do this by effectively using the Dispute Resolution Ladder (DRL).

The Dispute Resolution Ladder is a system for negotiating the resolution

to issues when a team gets stuck. We set up a Dispute Resolution Ladder

because we know that although we all benefit from resolving issues at the

lowest level possible, lingering unresolved issues create drag on a project.

And, issues get harder to resolve the longer they linger. Therefore, a policy

of expedited elevation is in the best interest of the project and all

of its stakeholders.

The Dispute Resolution Ladder is a system for

negotiating the resolution

to issues when a team

gets stuck.

Bumping it Up:5 Tips for Using Your Project’s Dispute Resolution Ladder

Bumping it Up:5 Tips for Using Your Project’s Dispute Resolution Ladder

www.partneringinstitute.org March/April 2014 Partnering Magazine 17

The following five tips will help you use your dispute resolution ladder to maximum benefit.

1. Your Job is to Elevate itProjects are a team sport. You have your role. Moreover, you

have a team surrounding you, with professionals who each

have their parts to play. That means when you have exhausted

your ability to resolve an issue, your job is to elevate it!

2. Jointly Define the ProblemThe way a problem is defined influences how it is resolved.

The most effective issue elevation occurs when you and your

counterpart focus on “what is fair” and then, jointly define

the problem.

3. Tell them Where You’re StuckYou’ve worked hard to resolve the issue. That makes you and

your counterpart the current experts on the problem. You owe

it to the next level to share what you know. That means that

you and your counterpart delineate each and every item in

contention. Together, you need to tell them where you are stuck.

4. Identify Areas of AgreementMost of the time, you and your counterpart have reached

agreement on some elements of the overall problems. To be

most effective, when you elevate an issue, you need to provide

information about what is resolved too. That means that you

tell them what you’ve done to try to solve the problem and

specifically identify areas of agreement.

5. Once a Decision is Made—Own it!The reason we have the Dispute Resolution Ladder is to make

decisions and resolve issues. It is likely that you will love some

of the decisions and others you will think are wrong. Either way,

once a decision is made—own it!

Cinda Bond Partnering Facilitator, OrgMetrics

Cinda Bond is an IPI Senior Certified

Partnering Facilitator and has worked in

the construction industry for over 30 years.

She specializes in facilitating large, complex

projects. You can contact Cinda at CindaBond@orgmet.com or

directly at (925) 640-9007.

Sample Dispute Resolution Ladder (DRL)With Alternative Dispute Resolution (ADR)

Level Owner (including Designer/Survey/Lab) Contractor (including Subs/Suppliers) Time to Elevate

ADR VII Facilitated Dispute Resolution (FDR)

VI Dispute Review Board (DRB)

DRL V Deputy Director/Senior Executive Owner: President 2 weeks

IV Construction Unit Leader Operations Manager 2 weeks

III PM Unit Leader/Construction Engineer Area Manager 1 week

II Manager/Resident Engineer Project Manager 1 week

I Project Engineer/Inspector Foreman/Superintendent 1 day

Sample Dispute Resultion Ladder (DRL) with Alternative Dispute Resolution (ADR)

ADVERTISE IN

Visit www.partneringinstitute.org

May/June 2014Feature: IPI Award WinnersDeadline: April 10, 2014

July/August 2014Feature: Partnering PioneersDeadline: June 9, 2014

September/October 2014Feature: Partnering Around the WorldDeadline: August 8, 2014

November/December 2014Feature: Year in ReviewDeadline: October 10, 2014

partnering innovationsSFO Shines On Terminal 3 East

page 8On-Time,

On-Budget

INSIDE:page 14

Bumping it Up with a DRL

Issue 1March/April 2014

18 Partnering Magazine March/April 2014 www.partneringinstitute.org

how they work together.

There is commitment that

there is to be a high level of

collaboration in everything

they do. It is this intention

that leads to creative problem

solving, to continuous

improvement and to trusted

leadership. This guides

everyone along the path to

creating a strong and lasting

culture of collaboration.

Your Intentions

Count

“...when the intention of

the leadership and teams is for true

culture change,

everyone is focused on

transforming how they work

together.”

Sue Dyer, MBA, MIPI, MDRF

Founder and CEO,

International Partnering Institute

IPI is often asked, how do

I make the Collaborative

Partnering Program

produce the results I want?

That I see others achieving?

We often find that the people

involved in programs that

are under-performing have a

different “intention” than in

those programs where they

are achieving extraordinary

results. Of course Collaborative

Partnering has a learning

curve and it will take time,

so please be patient. But

intention matters!

The graphic at the right

shows what we often see.

In the left column you see

the path where there is little

to no real change—people

are going through the

motions. The intention of the

leadership and teams is to

comply with an “order.” This

could come in the form of a

new statute, specification,

or memorandum. Since

the intention is to comply,

then that is what everyone

focuses on.

On the other hand (see

the right column), when the

intention of the leadership

and teams is for true

culture change, everyone

is focused on transforming

CEO’S MESSAGE

Making SFO’sPartnering Program FlyFor almost two decades OrgMetrics has been providing Partnering Services for San Francisco International Airport’srenowned Partnering Program

Partnering Program Development/Facilitation • Project Partnering Facilitation • Strategic Partnering Facilitation • Facilitated Dispute Resolution • Project Scorecards

www.orgmet.com | (925) 449-8300

20 Partnering Magazine March/April 2014 www.partneringinstitute.org