Pmnetwork December 1993 p. 32 Concerns of Project Managers
James H. Brown
Introduction
Partnering as a strategy was introduced to the construction industry approximately eight years ago.
Since its introduction there have been many example of "multi-project partnering" where two companies (owner-contractor) established long-term strategic business alliances. There has also been a growth trend in the industry for "single-project partnering" on a project-by-project basic. The major differences between these two variations of partnering is in the duration of the relationship, who initiates it, and the number of organizations involved.
The strongest barrier to the partnering concept is a project organizational structure that promotes an adversarial attitude between the parties involved. There are norrnally two to six distinct management teams, each making independent decisions with the intent of reaching their own goals for the project. These decisions directly affect the path each party chooses to achieve its goals--but they are often made in a vacuum, without regard for the other party's interests and expectations. Conflicts are inevitable as paths diverge and expectations are not met.
A key element of successful partnering is trust. Unfortunately, the E/C project environment has not been conducive to trust among the various contracting parties with the flood of lawsuits associated with the industry. Trust is difficult to build where there is cynicism about others' motives and a tendency exists to resolve disputes through litigation.
Because partnering is a departure from "business as usual," individuals and entire organizations often feel a loss of control, being at risk or being awkwardly dependent on others. Working under a partnering concept also places an even greater responsibility on project management to build col]aboration among the project entities and manage conflict. Since partnering relies heavily on a democratic versus authoritarian leadership style, many project managers and other key project members become completely frustrated with the effort.
Agreeing to partner on a project does not make these problems go away or keep conflict between organizations from occurring. Partnering is only a concept that the project team, once it agrees to it, has to "own" and successfully manage on a day-to-day basis. This keeps some partnering relationships from ever living through or past the first project.
EXAMPLE OF A FAILURE TO MANAGEA case in point involves a large manufacturing company (client) that used a partnering concept on a major capital expansion project in 1990. When the project was started the client informed the major contracting entities (engineer/design firm, construction management company, general contractor, and major subcontractors) that it wanted to approach the project differently than previous projects they had undertaken together. The client wanted to use a true project team approach where each entity was expected to be a team player and work together as partners to help each other be successful. Since the client wanted it this way, everyone agreed to it.
The typical problems started the third month into the project. Within six months the contracting entities had become entrenched in their protective modes of doing business. There was much "placing blame and finger pointing" by everyone as open communications shut down and project team members started defensive case building with the expectation that litigation would occur.
The following types of project issues surfaced in one-on-one interviews with a neutral third party at the eighth month stage:
The example illustrated above can happen on any project, whether or not a partnering concept is used. Partnering can be an effective way to prevent certain organizational problems from occurring, deal with those that do occur, and build a collaborative relationship among the project team -- but as shown above, it has to be managed.
A review of why project partnering sometimes fails to achieve its potential and intended goals points to the following key requirements:
Most project teams (client and contracting entities) rush to the technical side of the project at the beginning and focus all their resources there. The partnering/team side is often left to happen on its own or to be addressed after everything else has been settled. Since things rarely "settle" on a major project, the "ox cart is in the ditch" before it is addressed.
The commitment must be from the top down. Because of the additional ef- forts and up-front costs required for partner- ing, top levels of man- agement in each organization must be fully committed to the concept and the process. Without vis- ible commitment through partnering actions the process will have little chance of success. A partnering leader must be identified in each organization to champion and support the effort. Top management and partnering leaders should attend a workshop to gain a better understanding of their roles, develop a partnering vision and execute a partnering agreement for the project.
Successful partnering requires a "leap of faith" that is difficult for team members and their organizations. The workshop should strengthen the skills and ability of team members to work together and jointly manage conflict, solve problems, improve communications, identify potential problems, and clarify roles and responsibilities. The partnering leaders should introduce the partnering concept and outline the products to be developed in the workshop. Some of the workshop products should be a partnering charter, a dispute resolution model, project success criteri- a, an implementation plan, and an evaluation process.
E/C projects are contractual. Partnering does not automatically change the contract or project scope. It has to be managed within the legal framework of the contract(s) and the specifications of the project. Ambiguity of what partnering means on a specific project has led many contracting parties to perform work that was not reimbursed.
The work of E/C pro- jects gets done in the field and at lower organizational levels. These individuals must also be brought into the process. The project team must have a plan of action for rolling down the partnering concept to the people performing most of the work.
Formal, periodic evaluation is necessary to keep the project management team on track, review team perfommance, and assess opportunities for improvement. Follow-up sessions and workshops have proved essential to the maintenance and continuous renewal of the partnering commitment. Without follow-up, the tendency is to revert back to the traditional adversarial relationships and business- as-usual.
There is a feeling among some that partnering means "all relationships and no substance," and that the benefits are intangible and not worth the extra effort and cost. Although there needs to be additional data collected and analyzed re- garding the benefits of partnering, initial indications are that the benefits far outweigh the costs and effort.
A Construction Industry Institute (CII) Task Force that studied E/C partnering identified the following benefits based on survey data from existing partnering relationships [ 1 ]:
Total project cost reduced Improved contractor profitability Improvement in schedule Less adversarial Improved resburce planning Increased openness Increased trust Improved safety Fewer errors Improved quality |
% in Agreement 8% 10% 7% 85% 85% 83% 78% 90% 82% 96% |
Frank Carr, chief trial attorney and chief labor counselor for the U.S. Army Corps of Engineers, summarized the Corps' project partnering experiences in a 1991 address to the American Arbitration Association by stating:
Project partnering has potential benefits and payoff for all entities involved in a major E/C project. However, the success it attains depends on the sup- port of the organizations and the man- agement of the process by the project team.
REFERENCES
James H. Brown is a partner in Maxim, Inc., an organizational development and training firm located in Greenville, South Carolina. He has an MEd degree from the University of South Carolina and advanced graduate study in instructional design. Mr. Brown has 17 years of experience in the engineering and construction industry and has held training and project management positions with one of the largest ElC firms in the U.S. His area of speciality is helping organizations build multi-party project teams and assisting troubled teams realign for project success.