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Project Phases and Target Value Design
St. Olaf’s Fieldhouse Project
St. Olaf Carleton College
College Recreation Center
Fieldhouse
Completion Date August 2002 April 2000

Project Duration 14 months 24 months

Gross Square Feet 114,000 85,414

Total Cost (incl. A/E & $11,716,836 $13,533,179


CM fees )

Cost per square foot $102.79 $158.44


74/)/,00

No No

Board Design Board


Business Engage
Approval SD’s DD’s CDs Approval Permit Construction
Planning FPD
Feasibility

Planning

Business Project Sometimes 75% DD’s CD Check Project GMP On


Case Context Incremental First Est. Est. Approval Approved
Scope & Approval On the Docs.
For Design Large
Budget Projects
/$1)70&$+/,00),9
Fewer
Back Checks
Expected
No

FPD &
Feasibility Board
Business SD’s & DD’s CD’s Permit Construct
Study Approval
Planning

Project Set Target Detailed Target Doc Production & Predictable


Context Scope & Budget Value Complete Coordination Time & Cost
Scope, • Owner Design
Budget & • Arch Set Based Design Increased
Business • CM/GC Value Focus Value & Less
Case • Estimating Consultant Stress
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©The
©The
©The Boldt
Bol
oldt
lddtt Company
Com
mppa
annyy 2007
200
007
007
Shawano Clinic
•The target cost (construction budget) was set 3.6%
below market, the actual cost was 14.6% below
target, and 17.6% below the benchmark. Most of
the released funds were used to provide value-
adding scope, especially for imaging capability, with
the remainder returned to the client.

•Completed 3.5 months ahead of schedule –70


additional days of clinic revenue translating into
nearly $1 mil. in the expanded imaging service line
functions and additional revenue in the 2006 year.
Lean Project Delivery System

Design Product Fabrication


Purposes Commissioning
Concepts Design & Logistics

Process Operations &


Constraints Detailed
Design Installation Maintenance
Engineering

Project Definition Lean Design Lean Supply Lean Assembly Use

Production Control
Work Structuring
Learning
Loops
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Cathedral Hill Hospital Project:
Expected, Allowable & Target Cost

Allowable Cost for Construction (normalized for changes in scope)


Cathedral Hill Hospital Project:
Market, Allowable, Expected & Target Cost

Market cost with inflation

Allowable Cost for Construction (normalized for changes in


Allowable cost for construction
scope)All
Cathedral Hill Hospital Project:
Changes in Expected Cost
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13h
11m 11h
28m 10h 10h
28m 15m 10h
6m 9h
Area of Opportunity
17m

Inpatient Discharge Time of Day



+2;&+$&)&1;G/(,&+1H
How many visits to the Emergency Department can our facility
handle as designed with 32 ED Beds and 370 IP Beds?

ED LOS
(hrs)
(*"0)$
FEEDBACK LOOP
•
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© Glenn Ballard, 2008


Haahtela’s
Taku Cost
Model
Project Phases and Target Value Design
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Purpose Finance Action Example Comments
Create Maximum available Target Property
something to funds or minimum cost developer
Developer sell to others acceptable ROI

Create means Maximum available Target Oil refiner,


for producing funds or minimum cost healthcare
Producer products or acceptable ROI company,
services university

Acquire Ability to afford Buy at Law firm, But note: If facilities are
commodities lowest insurance not commodities and
price company can impact use benefits
through different
designs, then Shoppers
Shopper are actually Producers,
and buying at lowest
price is not likely to
deliver greatest value.

Create Within initially Design, Municipal At some point,


something indeterminate limits, then library, maximum available
without funds can be estimate performing funds will constrain the
Art predefinable acquired based on cost, then arts theater design. That point may
Collector properties the attractiveness of acquire occur earlier or later in
the design funds the design process.
=%)&*")#$*)$
%2#&)%("**)*)
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Dave Chambers
Chief Architect
Sutter Health
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