This thesis shows how performance management can improve client satisfaction

Early in her construction career, Wendy (Li) MacLeod-Roemer realized there was significant room to improve construction delivery beyond traditional means. To help advance our industry, she decided to pursue a PhD in organization management to understand what changes would be most effective. She dedicated her thesis to exploring how performance management can transform construction projects. Here, Wendy – now one of our senior project managers – explains how her research shows that cost isn’t what is most important to clients.

What inspired your thesis?

I had worked for several years for another general contractor, and I felt that, in general, the architecture, engineering and construction (A/E/C) industry is very conservative and, innovation-wise, operating backward from other industries. I was motivated to improve that and wanted to explore any tools the A/E/C industry can adopt from other industries.

What were the main tools you tried to adopt?

I read a lot about lean manufacturing and the Toyota Production System, and thought it was particularly of interest how the company continuously tracks and visually displays its performance to all workers – from those on the front lines all the way up to the executive level. This constant feedback helps them stay on top of their work, catch potential problems and course correct with agility – all important factors in the success of a project. I thought to myself: “This is such a simple thing, why doesn’t everyone do it?” On construction projects, no matter how many people you ask you’ll probably get a different answer regarding how each individual thinks the project is doing in terms of performance. I explored the “why” behind this and tried to see if construction could adopt what Toyota and other manufacturing industry leaders have been using to see similar successes with improving client satisfaction and performance. I needed to measure the data against something, and so I chose client satisfaction, the foremost indicator of project success.

How did you collect your data?

Project team members involved in day-to-day operations – including project managers and engineers, superintendents, design consultants and client representatives – were sent a handful of survey questions each week surrounding project performance metrics most closely related to their involvement on the project. The metrics included such subjects as commitment reliability (relating to how often promises made – such as for requests for information, submittals and meeting action items – were kept); constraint removal (relating to whatever is preventing a task from proceeding) and such subjective measures as leadership and meeting effectiveness.

The entire team would then receive feedback a couple of days after the survey: circling back this way helped project leaders know which areas to prioritize to improve day-to-day planning and overall project performance. Ultimately, I wanted to collect lots of data so I could see which areas of performance mattered most to the client at any given time – which areas truly predict project success. Is it really cost and schedule, as it often assumed?

What did you find?

Through looking at survey answers and talking with the clients, I found that it wasn’t cost that made them most happy, but rather overall project performance predictability. It is more important to clients that the team is effective and keeps the client in the loop on what is happening and what is planned to happen. This is in part because with complex projects with evolving needs throughout construction, cost can be somewhat fluid.

Another meaningful finding is that greater building information modeling (BIM) use and higher perceived BIM value leads to higher client satisfaction. Perceived BIM value refers to the benefits that construction team members believe that BIM brings to their projects. By using more effective BIM techniques, data showed that it ultimately led to happier clients. This is likely an indirect correlation – perhaps BIM improved the quality of design, which in turn improved on-site work, thus leading to happier clients.

PMC1

Sample dashboards used as feedback for the teams.

How was the performance management data displayed to the team?

Every week for three years, we emailed them the visual performance dashboard summarizing the survey results, and some projects would also post it in their office. The data was displayed much like a dashboard in your car. It had visual graphics like pie charts, line graphs and had traffic lights – green, yellow and red – to illustrate where you should focus your resources. When it showed yellow, it meant you needed to keep an eye on the issue, and red lights showed where you needed put your attention immediately. One of the drivers in creating the dashboard was that everyone is busy and has limited resources – a red light immediately draws your attention to something that’s wrong now.

I studied this on five projects over three years: these were the Palo Alto Medical Foundation’s San Carlos Center near San Francisco for which Skanska was part of the integrated project delivery team, and four projects for Walt Disney Imagineering. I picked San Carlos Center because the client – Sutter Health – is at the forefront of innovation and lean adoption, and Disney is also a leader in using lean for facilities delivery. Survey participation was voluntary, and, during the research period, I had over 10,700 responses from all the project teams, data was collected every single week. Additionally, by introducing this performance management tracking and feedback method, client satisfaction volatility was reduced by 13 percent across all five case studies. Reducing volatility is the first step to increasing satisfaction!

For general contractors, is this something you could use for trade contractors or craft workers?

It’s very flexible. It can be geared toward anything you want to manage. As project teams, you can send the surveys out to your trade contractors to get their feedback to measure specific scopes of work. You can vary the metrics and ask questions more specific to project controls or preconstruction.

PMC2

A snapshot of labor productivity over the last 40 years. The blue line shows the increase in productivity across industries with the exception of construction, portrayed by the red line, which has decreased.

How do you envision this method being implemented in the future?

No formal method has been widely disseminated to keep track of construction project performance. To fill this gap, my method offers a very simple and intuitive approach. The survey and statistical analysis tools I used already exist and are easy to use. Ideally, in the future a program could automate all of this and put it together to include both metric data collection and dashboard feedback. It’s kind of like how BIM use diffused throughout the A/E/C industry. There was some resistance at first, but compared to BIM this is much easier to implement. It’s one of my goals to hopefully get Skanska to use this metric-based performance feedback methodology (called MetPerforma) at the regional level where I am, and then adopt it across the board.

All other industries have improved in terms of labor productivity in the last 40 years except for construction, which went down 20 percent! This even included farming, which shot straight up on the index. Economists found that performance management as a practice is directly correlated to productivity, among other contributing factors. My PhD research validated that MetPerforma improves construction performance management as a practice. My vision is for it to ultimately improve field productivity industry-wide.

For more information on Wendy’s dissertation check out her presentation here:

Skanska USA

Skanska USA

Skanska USA is one of the largest, most financially sound construction and development companies in the U.S., serving a broad range of clients in the public and private sectors, including those in transportation, power, industrial, water/wastewater, healthcare, life science, education, sports & entertainment, data centers, government, aviation and commercial industries.

More Posts - Website

Share this postShare on FacebookShare on Google+Share on StumbleUponPin on PinterestTweet about this on TwitterShare on RedditShare on LinkedInEmail this to someone
{ 1 comment… add one }

Leave a Comment