The Use of Partnering & Risk Management

Principles in Construction Projects

Mark E. Cacamis, PE, CCM George P. Gardner, PE, CMC

State Construction Engineer State Partnering Coordinator
 About VDOT - Districts

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 Sizing Up VDOT

• Responsible for the construction, maintenance,

and operation of interstate, primary, and
secondary highways, including bridges &
tunnels

• 3rd largest U.S. state-maintained highway

system (approx. 57,000 miles of state roads)

• Approximately 9,000 employees

• Typical budget of $3 billion +

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 Partnering Mindset

“Coming together is a beginning,

keeping together is progress,

working together is success.”

- Henry Ford

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 Partnering Definition

"a process based on trust and an open,

honest attitude in which all participants in a

project/process recognize both common and

individual objectives and work to achieve

those objectives through improved

communication and cooperation.”

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 Risk Management is the Systematic Process of:

• Identifying Hazards and Associated Risks

• Assessment-Quantifying Risks

• Mitigation-Identifying Pro-active Actions planned to

eliminate or mitigate the risks

• Control-Identifying Methods to be utilized for the

control of risks
 Partnering & Risk Management Values

• Trust

• Teamwork

• Communication

• Motivation

• Empowerment

• Issue Resolution

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 What Partnering & Risk Management
“Is Not”

• Does Not Change the Terms of the Contract

• A Score Keeping Relationship where One

Side Attempts to Take Advantage of the
Other

• A Give Away Program

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 What Partnering & Risk Management
“Is”

• Going the Extra Mile to Look at Issues from

the Other Party’s Point of View

• A Commitment by all Parties to Work Within

the Requirements of the Contract

• Shared Responsibility by all Stakeholders

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 Typical Stakeholders

• Prime Contractor

• Sub-Contractors

• Key Owner Staff

• Utility Companies

• Designers

• Federal, State, other Local Officials

• Suppliers

• Inspection Consultants

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 Typical Goals/Benefits/Outcomes of
Partnering & Risk Management

• Improved Communications & Relationships

• Quicker/Simpler Problem Solving, Issue

Resolution, Decision Making, &
Evaluation/Mitigation of Risks

• These all lead to More Efficient Schedules,

which in-turn leads to Completing Projects
Within Budget, while Meeting Safety, Quality
& Environmental Standards
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 Standard Partnering & Risk Management
Process
• Plan for Partnering & Risk Management (in pre-
advertisement stage, type-formal, informal, etc.)
• Hold Pre-Partnering & Risk Meeting (after pre-con
meeting, set plans with contractor, etc.)
• Conduct Initial Partnering & Risk Management
Workshop (decide to use either external or internal
facilitator at beginning of project, etc.)
• Schedule Follow-up Sessions (conducted monthly,
quarterly, & final closeout session, etc.)
• Utilize Team Surveys (to keep efforts on track,
use of survey software, etc.)
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 Typical Workshop Agenda
• Introduction/Purpose/Project Overview

• Review Partnering & Risk Management Principles

• Review Key Project Performance & Risk Areas (Safety,

Quality, Environmental, Schedule, Budget, etc.)

• Develop Communication & Decision Making Process

• Develop Issue Resolution Ladder

• Analyze Current/Potential Issues and Identify & Assign

Probability (P) and Impact (I) of Risks (P x I = RS)

• Develop Charter & Action Plans to Mitigate Risks

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 Typical Performance & Risk Areas
(note: can be different/specific to each project)

Partnering
* Communication * Cooperation and Respect
* Teamwork * Issue Resolution

Risk Management
* Safety * Environmental
* Quality * Schedule
* Budget * Materials, Utilities

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 Typical Charter Contents

• Project Name & Description

• Team Mission Statement

• Guiding Principles (Professionalism, Honesty,

Trust, Respect, Relationships & Cooperation, etc.)

• Strategies (Safety, Quality, Environment,

Communications & Decision-Making, Issue
Resolution, On-Time & On-Budget, etc.)

• All Stakeholders Sign Charter

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 Typical Issue Resolution Action Plan
Project Number: Description:
Entry Issue Description Responsible Target Status
Date Description of Proposed Person (s) Resolution
Resolution Date

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Full Stakeholder Risk Management
Typical Risk Breakdown Structure
Risk Management Database
Risks Ranked by Risk Score (RS)
Risk Analysis for Monthly Update
16-Week Look Ahead Risk Report
Risk Reporting
 Current Supporting VDOT Policies

• Special Specification Provision for Partnering:

– Describes the requirements of partnering in
contracts
• Partnering Guidelines:
– Recommends appropriate level of partnering
for contracts based on type, complexity,
duration, etc.

* To develop a risk management specification

with procedures once prototyped on a
variety of projects
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 Program Communications
• Training/Orientation Sessions:
– Each year, the State Construction Engineer & State Partnering
Coordinator, holds briefings in VDOT Districts across the
State as needed and at the Transportation Construction
Management Institute (TCMI)

– Session outline typically includes:

• Partnering Principles, Processes, and Policies (to include
Risk Management once process is fully developed)

– Attendees typically include:

• Industry Representatives
• District Construction Engineers
• District Preliminary Engineering Managers
• Area Construction Engineers
• Design Engineers & Technicians
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• Construction Managers & Inspectors
 Program Communications
• Professional Practice, Research, & Papers
– The State Construction Engineer has researched and applied
extensively, the practice of Partnering & Risk Management in
both private and public sectors

– Research includes outcomes and new practices that enhance

Partnering with industry:
– CMAdvisor Magazine, Volume XXXI, No. 2, March/April 2012,
Evolving Partnering, by Mark E. Cacamis, PE, CCM

– American Society of Civil Engineers’, Practice Periodical on

Structural Design and Construction, 2013, Improving Project
Performance through Partnering and Emotional Intelligence, by
Mark E. Cacamis, PE, M.ASCE and Mounir El Asmar, Ph.D., M. ASCE

– Member of International Partnering Institute (IPI) working

committee
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 Driving Forces

 VDOT Executives committed to forging Improved

Relationships with Industry:
 Improves efficiency & effectiveness of projects
 Pressure from legislature & public perception

 CEO’s of Industry demand More Accountability:

 Decreases time in decision-making & problem solving and
increases risk mitigation

 District Construction Teams (DCE, ACE, CM, Insp.)

More Focused on Process Outcomes:
 Functioning as Champions of Partnering & Risk
Management in the Field
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 Major Milestones/Timeline
• 1990’s:
• Partnering formally or informally on thirty-seven past contracts

• 2000’s:
• Construction Directive 2004-1 issued: contained guidelines for making
decisions and managing timeliness of communications
• Members from Industry and VDOT convened: CEO & Commissioner Meetings
used to develop strategies in revitalizing the use of Partnering concepts
• Published Partnering Field Guide v1.0
• New Contract Provision developed: suggested the use of either formal or
informal Partnering in all contracts
• Contract Guidelines implemented: provides direction on the level of Partnering
needed based on complexity and contract characteristics

• 2014-Future:
– Most large contracts use either Formal or Informal Partnering
– Continuing to refine the process and educate staff
– Integrating Risk Management principals into (3) current projects
and a variety of future projects
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 Success Stories - Example Projects
 Gilmerton Bridge Project, 2013 (Hampton Roads):
 General Contractor: PCL. Inc.
 Excellent Safety, On-Time, On-Budget, High Quality
 Very Technically complicated
 The first VDOT project to implement “Risk Management” concepts
into the partnering process

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 Success Stories - Example Projects
 Woodrow Wilson Bridge Project, 2012 (Northern Virginia):

 Megaproject on-time, on-budget

 Major VDOT contracts (all Partnered):
 Route 1 Earthwork Shirley Contracting $32.9 million
 Route 1 Tie-in Corman Construction 61.5 million
 Route 1 Advance Bridge R R Dawson 41.9 million
 Route 1 Interchange Skanska USA Civil 168.2 million
 Telegraph Earthwork Shirley Contracting 3.2 million
 Telegraph Utilities Shirley Contracting 24.9 million
 Telegraph Interchange CK Constructors 236.4 million

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 Success Stories - Example Projects

 Woodrow Wilson Bridge Project, 2012 (Northern Virginia) continued:

 Partnering elements:
 Top management support

 Designated in-house partnering advocate

 Regular follow-up meetings

 Convenient measurement &

reporting

 Multiple award winner:

 NPHQ Silver award for partnering on Route 1 Advance Bridge
 ARTBA/TDF Globe awards for environmental
 IRF Global Road Achievement Award for program management
 ASCE Outstanding Civil Engineering Achievement award

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 Success Stories - Example Projects

 I-95 4th Lane Widening Project, 2011 (NOVA):

 General Contractor: Shirley Contracting, Inc.
 One of the most successfully partnered recent projects
 $122 million project finished ahead of schedule and under budget
 High quality scores and safety accomplishments

 Route 5 Bridge Project, 2010 (Richmond):

 General Contractor: Skanska Inc.
 An example of real-time successful Partnering
 Facilitated internally by State Partnering Coordinator
 Completed on-time & on-budget, safely, with no claims, and a focus
on quality

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 Success Stories - Example Projects

 Rt. 33 West Point Bridge Project, 2007 (Fredericksburg):

 General Contractor: Joint Venture of McLean & Bryant
 On-time, on-budget, high quality, solid safety
 Received 2007 NPHQ “National Achievement Award” for:
 Formal partnering commitments
 Context-sensitive solutions (CSS)
 Communication with community

 I-81 Scales Replacement Project, 1993 (Staunton):

 General Contractor: English Inc.
 One of VDOT’s early successful formal Partnering efforts
 Winner of the AGC of America Excellence in Partnering - Marvin
Black Award
 Completed on-time & on-budget, safely, with no claims, and a
focus on quality

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 VDOT Contract Performance (reflection of improved field
leadership, specifications, scheduling, and partnering)
100%

90%

80%

70% Const. On-Time

60% Const. On-Budget

Linear (Const. On-Time)

50%

Linear (Const. On-Budget)

40%
Partnering
30% Instituted

20%

10%

0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
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 VDOT Contract Quality (CQIP) (reflection of improved
field leadership, specifications, scheduling, and
partnering
94.00%

93.00%

92.00%

91.00%

90.00%

89.00% Partnering
Instituted
88.00%

87.00%

86.00%

85.00%

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 Lessons Learned So far

• Don’t drop the ball after the initial workshop

– A “Partnering & Risk Champion” should live with the project
– This could be an outside facilitator, DCE, ACE, contractor, etc.

• Involve the top project leaders in implementing

Partnering & Risk Management and keep them engaged in
the process
– They set the tone & budgets

• Encourage all Partnering & Risk Stakeholders along the

journey
– There will be bumps in the road
– Choose to be positive!
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 Lessons Learned So Far

• Don’t make the processes too bureaucratic or

cumbersome
– Too much bureaucracy can sink it
– Ownership and Buy-In “by Choice” from Contractor and Districts

• Show the value of Partnering & Risk Assessment in each

project
– By regular assessment and honest discussion

• Largest single success factor so far has been the reduced

time required to make decisions
– Ultimately completing projects safely, on-time, on-budget,
with great quality
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 Available Resources
• Field Guide for Partnering
• Contract Special Provision for Partnering
• Contract Partnering Guidelines (Formal, Informal)
• Approved Facilitator Listing
• VDOT Risk Management Database
• Others in Partnering Library (on Inside VDOT, Construction
Division, Partnering Team site)

Contacts:
Mark E. Cacamis, PE, CCM (State Construction Engineer)
Mark.Cacamis@vdot.virginia.gov

George P. Gardner, PE, CMC (State Partnering Coordinator)

George.Gardner@vdot.virginia.gov
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