Seems like we are gluttons for punishment at GagaMuller Group, but we just cannot let sleeping dogs lie. Being innovators and integrators in our industry must come hand in hand with being disruptors. We get the feel we are like marmite, you either love us or you hate us!
The National Children's Hospital is back in the news, and considering the heat we got from the past article we wrote on the subject, you would think we have learned our lesson…..absolutely…that’s why we are writing this again today!
This project has all the hallmarks of what we KNOW to be wrong with this industry. The media and papers are all very quick to point the finger at the contractor but as we have learned from the landmass to the left of our great emerald isle, one should not believe everything they read.
Our opinions might sometimes anger, but our beliefs are pure. This industry is as backwards as they come, second most backwards industry in the world second to hunting…..
All outlined in our previous article, the problem as we see it, is an incomplete design and overall control of change to the project.
The PWC Report states that “the content of the BoQ changed during the GMP Process, resulting in an increase in costs of €158.3m”.
This finding demonstrates that maybe it wasn’t the main contractor that was wrong; it demonstrates that there were fundamental issues with how the client’s appointed party priced the project. There are a number of likely reasons for this:
Inefficient/Conflicting Quantification Techniques
Ineffective Project Controls
Lack of Digitalisation
Today, the main contractor for the National Children’s Hospital has said that it “rejects” accusations that it is “underperforming” or has under-resourced the troubled project. This followed from yesterdays claims from the chief officer of the National Paediatric Hospital Development Board, David Gunning, at the Public Accounts Committee, who said that the “main driver” for the delays and €300m in claims the company had made to date “continues to be the lack of a fully complete, co-ordinated design for the project”.
With a statement released yesterday stating that There have been almost 10,000 new drawings (including mechanical and electrical drawings) since GMP (Guaranteed Maximum Price) stage in January 2019, it seems that for all the heat we got from our article over 12 months ago, it looks like we weren’t too far wrong in what we predicted!
Are the contractors angels? No, of course not, but they are playing the ball as it was laid to them. If I was through on goal and the keeper gets fouled, leaving me with an empty net, I am burying that ball into the onion bag and doing the Klinsmann at the corner flag all day.
Let him who is without sin cast the first stone
Before all the designers line up for abuse here, it's not a crack at them either. Designers over the decades have been given more and more scope to not only design a building for a client and all that comes with it, such as calculations and specification and testing, but also to set up the project infrastructure, the information management plans, the design schedule and to consider risk and budget – all of these added complexities, without any extension on a design schedule. The current day expectations on design teams are ridiculous. Rarely have we seen a design schedule that is realistic.
This obvious gap in the market is what GagaMuller Group was set up to tackle. We are a cost and schedule focused construction management firm.
A big mistake clients are being led to making in our industry is that the answer lies with a BIM consultant….wrong. BIM consultants know how to federate a model and create clashes, they do not develop risk registers, analyse the specification and drawings for potential risk in terms of buildability, they do not offer guidance on value engineering or modularization strategies.
Others believe the client's side that cost consultants and project managers are here to facilitate this….you would think so. We find most ‘experts’ are still using out-dated workflows to deliver advanced projects. Many of these are high level template producing organisations, who provide a weekly meeting service forming a more advisory capacity than getting into the detailed analysis of a project.
Where is the gap then?
It is simple, the term early engagement identifies that we are already trying to fill this gap. But current contract arrangements don’t lend themselves the ability to facilitate it. Why not just use contractors at early stages then? Well depending on the contract type, most contractors are opportunistic, it doesn’t take a genius to understand that there is money to be made through claims and variations by turning a blind eye during design.
Make it someone else’s problem
The concept of pushing the risk down to the contractors needs to be eradicated. Design teams, through the client, tend to push the risk down to the main contractor by passing on inadequate, uncoordinated designs that result in large amounts of RFIs and variations. To combat this, main contractors have taken steps to embrace Digital Construction as it offers a means to mitigate the inherent risk.
Where main Contractors used to inevitably get burnt by these risks, they now have the capability to use the design team's tactic of offloading the risk against them. The main contractor can price what is put in front of them (e.g. insufficient or inaccurate quantification), in what is known as the ‘price it low’ strategy and then hit the client with variations to bump up their margins.
The impact to the owner who was convinced by his advisors and designers over wine and steak 24 months ago that there is no risk, yet all too often the owners are left pondering the unquantifiable impacts of the schedule delays regardless of who is going to win the claim. Over 80% of construction projects run over schedule - This is risk that the owner needs to consider more seriously. NCH is now due to open in 2024, reports suggest, with cost impacts to the tax payers in the hundreds of millions even though the "risk" was supposedly pushed to the contractors. No one is winning here really, yet we will do it all again on the next project.
The power of Data
Data - it’s a buzz word spinning this industry for the past few years. The people who understand it, can't believe others don’t use it, the people who don’t use it, can't believe others believe in this rubbish or are too scared to get involved. The truth is, at GagaMuller, we find that once we show how simple “Data Analytics” really is – like setting up a few folders on SharePoint and creating a rates library to feed template BOQ’s, simple.
Our Clients tend to develop the rest of their strategy themselves, besides nothing has changed in how we build, we have just found a quicker way of churning through it. We have cases where we have taken the workload off over 30+ staff and put it into the workload of 1. That doesn’t mean 29 staff are now queuing for the dole every Wednesday, it means they are not mindlessly working on administrative duties and can now concentrate on doing what they are actually meant to be doing, generating revenue for their business.
Progress tracking during construction
Our services expand further than cost and schedule risk analysis during design, where we really come into our own, and again, filling a void in construction is to sit alongside a PSCS or General Contractor during construction phase and monitor delivery on behalf of the client. Comparing ourselves to Cambridge analytics might be a bit strong, but allowing the client access to a mission control room of all live data in real time from their project or list of portfolios is where we really come into our own, and where all of our clients to date have commended our business.
Sometimes confused for a BIM company, I would hazard an estimate that 5% of what we do is BIM Management. In fact, a lot of our BIM services we have actually automated because it was getting in the way of the true value added and return on investment to our clients.
Of course we still provide BIM services, however using us for BIM services would be like Brian Cody only using TJ Reid for his free taking ability.
Our mission controls construction management deliverables, which puts the power in the owner's hands in a platform they are comfortable with, all associated geospatially – this means in layman’s that we can offer you a locational view of your sites and floor plans, which you can zoom in and out from much like Google Maps or Uber. Allowing you to toggle on different layers (resources, tasks, equipment, snags, drawings outstanding, design changes, RFIs, conflicts, drone imagery, drawing layers, change requests, site variations, laser scans, narratives of disputes and resolutions) and much more.
Lets get to more specific, and real life examples. Take tracking of works complete and approval of invoicing for the project, which we know is another root cause of cost overruns and claims.
Instead of sending a few QS’s down each week with a notepad and highlighter to put their finger in the air and record a progress completion of works percentage, why not use the data that’s already available to inform everyone of works complete.
The Contractor on this project are one of the best and most advanced digitally in Ireland and even Europe right now, no matter how good other contractors may seem, due to their excessively large marketing budget. Those of us in the know in this industry are all aware of the level of sophistication that contractor possess. All of their work completions, wall closures, ceiling closures, fireproofing sign offs, service installations, concrete pours, are all recorded on mobile devices and signed off using BIM 360 Field.
Well then it wouldn’t take a lot of effort to create an SQL server and map these checklists to a location on a floor plan for traffic light system of works complete per package, linked to a line item in the P6 schedule and linked to a BOQ item and invoice, would it? This is what GagaMuller do on a daily basis. This is why those of you who have bought into digital implementation look at those of you who haven’t, and consider you to be in the same bracket as the Flat Earthers.
It is not a sales pitch, it is a fact
Having an independent firm such as GagaMuller Group can ensure that there is a realistic schedule on the design, the tender cost analysis is backed up by potential risks in the scopes and specifications, and the designers are designing with costs in mind. Moving into the construction phase, it allows for the control measures of delivery and early warnings to be identified and resolved, limiting impact on the schedule.
Heavily focused on cost savings driven by the schedule, we are providing real data and metrics on the BOQ and schedule savings, establishing minimum requirements, standards and procedures to be implemented on all client projects. Integrated design delivery through regular costs estimates and design control with an eye always firmly on the schedule and deliverables. The power of how we utilise data and allow the machines to do the work is something I can confidently say no one, certainly in Europe, and if not globally, can come close to holding a candle to us.
We can typically guarantee a cost savings of at least 5 times what our customers typically invest in our services, all of which we back up with real data, cost reports with detail of delay costs material, labour and schedule impacts. We have, half jokingly, half seriously, offered clients in the past a no fee approach where we get a percentage of savings identified, still waiting for someone brave enough to take us up on it!
We are getting huge traction from client's side clients over the past year, where we are starting to find our rhythm in terms of where we sit in the market. We still work for PSCS, where we partner team members into their organizations and improve on connecting their disciplines, many of whom want us on their side especially to manage narratives for claims and disputes, using data analytics. We have over €5 Million recorded in savings to our customers to date all backed up with data and BOQs.
It's because of this more and more clients prefer us to be working for them than against them with this power of data, especially property developers in residential and commercial markets in London and Dublin, data centre developers across Europe, and even life science pharmaceutical clients are finding it more useful to have us work directly across their accounts in partnership with the PSCS, where we also think we are best positioned. This is all opening us up to early stage engagement and risk mitigation, PMO and project delivery plan configuration, unlocking the power of real time data analytics when onboarding your contractors during construction.