FMI/CMAA Tenth Annual Survey of Owners

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Exhibit 1Outsourcing Trends% Outsourced90%80%70%60%50%40%30%20062009201420%10%0%Pre-DesignDesignOversightDesignServicesProcurementServicesConstructionOversightConstructionPerformanceProgramActivationOperations andMaintenanceNotably, the outsourcing of program activation and O&M will increase significantly, 60 percent and 30 percent respectively, andrepresents evidence of a long-term trend demanding a broader set of services from traditional design and construction firms.FMI has long believed one of the transformations occurring in the design/construction markets is a shift away from “silo”sourcing of services and toward preferred service providers offering multiple services.Inflection Point: Perspectives and Experiences Shift Importance of FunctionSeveral services or functions that are viewed as relatively unimportant today will gain dramatically in emphasis over the nextfive years (Exhibit 2). Four of these five “least important” factors in 2009 registered the greatest gains in importance over thenext five years.Falling just outside of the top five, “11c Commissioning: Completion and submission of all commissioning,facility turnover, LEED, and other documentation necessary to support facility transfer orcertification obtainable during the post-construction process” demonstrates one of the highestpercentage gains in “very” and “quite important” ratings, further reinforcing a shift in perspectivebetween 2009 and 2014.[Biggest change desired]“Familiarity withsustainable design/LEED”– National Retail Owner/DeveloperExhibit 22009 Lowest Importance Standards of PracticeStandards of Practice 2014 Overall 2014 “Very” and “QuiteImportance Gain Important” Gain Only8c Project Delivery System:Determine the best project delivery system…* 7.1% 16.7%12b Maintenance Management:Design a maintenance management system…* 9.2% 24.4%6c Avoid Claims: Develop strategies to avoid disputes and claims * 7.5% 17.7%6b Find Likely Claims: Identify elements…give rise to disputes and claims 7.3% 14.4%12c Maintenance Technology:Use GIS, GPS BIM to provide effective maintenance management * 26.4% 83.8%* Denotes factors registering the greatest gains in importance over the next five years25FMI/CMAA Tenth Annual Survey of Owners
Inflection Point: Holistic StrategyThese shifts in importance also portend a growing owner emphasis on true life-cycle cost calculation and an ever-strongerdesire for contractors to help them predict and control long-term costs. This holistic strategy can be observed by the increasingnumber of owners using both a program management, versus a project-centric, approach and an asset management approachto capital construction. This approach is demonstrated by the top 10 most important standards of practices containing at leastone practice originating from each of the major phases of the construction process. In addition, five of eleven areas mostfrequently mentioned for improvement by owners relate to or infer the use of a life cycle cost type approach.The most important services today remain so in the future. Presented in Exhibit 3 are four depictions of the most importantstandards of practice or activities as rated by responding owners.Exhibit 3Most Important Standards of Practice2009 Most Important Standards of Practice 2014 Most Important Standards of PracticeTop 10 OverallImportance10c - Work Conformance9e - Contractor Compliance10d - Risk Mgt.10b - Build Schedule8d - Scope of Work11d - Punch List6e - Design Conformance11b - Monitor Testing7d - Address Comments9c - Critical-Path ScheduleTop 5 “Very” and“Quite Important” Only10c - Work Conformance9e - Contractor Compliance8d - Scope of Work11d - Punch List9c - Critical-Path ScheduleTop 10 OverallImportance10c - Work Conformance9e - Contractor Compliance10d - Risk Mgt.10b - Build Schedule8d - Scope of Work6e - Design Conformance6d - Monitor Cost7d - Address Comments9c - Critical-Path Schedule11b - Monitor TestingTop 5 “Very” and“Quite Important” Only10c - Work Conformance9e - Contractor Compliance10b - Build Schedule10d - Risk Mgt.7d - Address CommentsToday’s top two concerns, as measured by the frequency of “very” and “quite important” rankings only, deal chiefly with assuringthat a project is built in conformance with the contract documents. They remain the most important considerations five yearsfrom now. The third through fifth items in 2014, measured by the frequency of “very”and “quite important” rankings, although new to the “top five” in 2014, are actuallyranked sixth through eighth in 2009, and have moved up without changing their order.The three items they replace – scope of work, punch list, and critical path schedule –will fall out of the top five to 13th, eighth and ninth positions, respectively. “8d Scopeof work: Developing the scope of work for bid packages” is the only 2009 top five factorthat falls out of the top 10 in 2014.[Greatest area for improvement]“Lack of critical thinking, communicationand writing skills area major detriment to projects”– Large U.S. City, Public Works DirectorIn some cases a relatively small gain in importance rating has resulted in a move of severalspaces up the ranking list. For example, “7d Address Comments: Ensure that reviewcomments are adequately addressed during the design phase” is ranked as quite or very important by 85 percent of respondentstoday and 92 percent for 2014, a gain of 9 percent. This gain was sufficient to move this factor from eighth place to fifth.Team coordination in some form was mentioned most often across all provider categories. This includes integrated projectdelivery, more use of BIM, adoption of 3D and 4D design techniques, and similar factors. The processes necessary to implementthese types of techniques demand integration across the construction supply chain and are also necessary to utilize a full lifecycle or asset management approach to capital construction.Taken together, the combination of highly important standards of practice and general comments describe an environmentwhere owners of all types are looking for a more effective collaborative approach from their service providers. This is fullyconsistent with the comprehensive view of projects that is revealed by the other survey questions.FMI Management Consulting26
Page 2 and 3: TABLE OF CONTENTSExecutive Summary
Page 4 and 5: HIGHLIGHTSUse of outsourcing in all
Page 8 and 9: A/E/C FUTURES RESEARCHWhat?During 2
Page 10 and 11: Scenario 2: Struggle for StabilityI
Page 12 and 13: Scenario 4: Controlled EnvironmentI
Page 14 and 15: SURVEY RESULTSFMI and CMAA develope
Page 16 and 17: By 2014, a general increase in outs
Page 18 and 19: Surprisingly, “6c Avoid Claims”
Page 20 and 21: Exhibit 10Rating of Importance (2 o
Page 22 and 23: General QuestionsOwners were asked
Page 24 and 25: Exhibit 14Owner Response by Industr
Page 26 and 27: CONCLUSIONThe Tenth Annual Survey o

FMI/CMAA Tenth Annual Survey of Owners

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