Best Value News

Interesting people you meet.

While at a Best Value Conference in Phoenix, AZ. in Feb., I had the opportunity to chat with Ted Garrison, who was also in attendance. Ted is from the Internet radio program, New Construction Strategies. I found Ted to be a very interesting, knowledgeable person, with many views similar to mine. Ted has agreed to let CPI put some of his radio broadcast and interviews on our Web site. Check them out at: http://www.constructionpartnership.com

You can also reach the Garrison report on CPI’s Web site. The interviews with Dr Dean Kashiwagi are only a click away. Dr Dean’s research on Best Value Contracting at the Performance Based Studies Research Group at Arizona State University insures he is the outstanding leader in this field.

All of this brings me to announce, far in advance, that Construction Partnership will hold a seminar on Best Value Construction the morning of Aug. 20, in Rochester. A Win - Win seminar for all. John Savicky, a member of the Performance Based Studies Research Group, will present the seminar. Mark your calendars now for the morning. More details will follow.

You can read or listen to the following article.

Have A Great Day!

Don De Keyrel

The Garrison Report #2008-4 (The Report on Strategic Thinking)

The Garrison Report

Lessons from Dubai 

Listen to the audio version of this report here.

I've just returned from Dubai in the United Arab Emirates. It's a trip that everyone in the construction industry should make. It's a dynamic and lively place. Everywhere you look, you see tower cranes. The claim that a third of the entire world's supply of tower cranes is located in Dubai is probably a little overstated (if there were one tower crane in every city around the world, it would make this claim impossible). However, I'm sure every visitor is awed by the sheer number of tower cranes that are visible throughout the city. I can certainly say I've never seen anything like it.

For the past decade and half, Dubai has been growing at an incredible rate. But the question is this: How has it been able to accomplish that? The answer provides some valuable lessons for the United States. The simple answer is that the UAE government has created an atmosphere that not only encourages growth, but has invested in and supported that growth with critical policies.

First, at the beginning and throughout the process, the government has heavily invested in the infrastructure. This includes the navigation improvements to Dubai Creek, the construction of the largest man-made harbor in the world, roads and bridges, desalination water-treatment plants and the construction of the longest tram complex in the world.

During the 1800s the United States grew rapidly due to the investment in the railroad system. While society often distained the tremendous wealth it created for those who directly invested in that enterprise by referring to them as "robber barons," without that investment, the United States would not have thrived during that period. Then the Federal Aid Highway Act of 1956 established one of the wonders of the world, the U.S. interstate highway system, which spurred another period of rapid growth that never could have occurred without that program.

Yet America has lost its way. Our infrastructure has been allowed to deteriorate, sometimes with deadly consequences as in the case of I-35W bridge collapse in Minneapolis in 2007. The United States must make the necessary estimated $225 billion annual investment in our surface transportation infrastructure system for the next 50 years. Otherwise, we will see increased congestion, which will jeopardize America's economic leadership in the world because it will make it more and more difficult to reliably and efficiently move goods. As a benchmark, we are currently spending only about 40 percent of what is needed.

In part this requires a partnership between government and the private sector. This requires the establishment of transparent policies that support and encourage private enterprise. Investments made by the government must be based on priorities that maximize the value and benefit to the nation instead of supporting special-interest groups. Congressional earmarking needs to be eliminated; funds should be allocated based on national interest—not awarded based on power of local political leaders. The current system has created little confidence in the American public, making it difficult to generate the necessary funds to maintain our economic engine.

The Financial Times asked the governor of the Dubai Financial Centre what the key to sustaining the country's economic growth was. He responded, "The key is to create political stability and retain a high caliber of human resources. Developing human resources and attracting and retaining individuals with experience is our goal."

The point here is that the construction industry needs to recognize that it must invest in the development of its workforce. The reality is there aren't enough skilled workers and management to fill the needs. Therefore, we need to develop them. In part, the industry needs to work with universities to help create curricula that better reflect the needs of the industry. Further, colleges need to increase the number of courses that focus on teaching students how to seek solutions and find better answers, not merely manage the old, outdated processes.

In 1990 Edwards Deming said, "The economic position of the U.S. has been on the decline for three decades." He further added, "We have been led astray by faith in adversarial competition." Unfortunately, things have only gotten worse in the past 17 years. It's time we start educating students and those within our industry that the solution is collaboration, not increased control and competition. Only through collaboration can the best solution for a project be found because it takes the collective expertise of all the various disciplines to produce the best result. When each discipline is in competition with the others, everyone loses.

Even the community that gets a bridge to nowhere, despite the short-term benefit, loses because when that money could have been better spent, it negatively impacts the nation's economy and costs to deliver goods. The result is the development that was anticipated by that bridge may never occur. We love to import "things" from overseas. Well, it's about time we import a few very valuable ideas from Dubai.