Welcome to Session 228

The Benefits of EPCM Project Delivery
for Your Distribution Facility
Presented by:

Sponsored by:

Stephen Donohoe, PMP – Manager of
Construction
Ted Dalferes, P.E. – Director,
Distribution Center Design
Tim Johnson – Project Manager
© 2011 Material Handling Industry®. Copyright claimed as to audiovisual works of seminar
sessions and sound recordings of seminar sessions. All rights reserved.

Construction Management .Agenda • Speaker Introductions • Factors & Influencers • Owner’s Control & Risk • Why Use an EPCM* Approach? *Engineering. Procurement.

claims. etc. objectives • Degree of Project Complexity .Factors & Influencers • When to bring on CM or GC • Owner Requirements – How much control – Schedule objectives – Cost objective – Quality objectives – Safety.

Typical Owner’s Requirements • Budget – On budget – Min contingency remaining at completion • Schedule – Meet commitments • Design – Quality – Functionality • NO CHANGES! LOWEST COST! MAXIMIZE CONTROL! Construction – No defects – No claims – No accidents • Coordination – Minimize impact to operations SHORTEST SCHEDULE! .

renovation .Delivery Method Influencers • Owner’s: – – – – Budget & risk objectives – guarantees? Schedule objectives – degree of urgency Desire for control – design & construction Resources – experienced & qualified PMs • Project complexity & design • Procurement flexibility • Single project or multiple projects • New construction vs.

Balancing the Variables Risk Exposure Low High Procurement Flexibility Public Private Owner Control Min. Max. Schedule Criticality Low High .

Owner’s Control & Risk OWNER CONTROL HIGH Where do you want to be? CONTROL AND RISK LOW CM Agent CM Cost Multi-Prime Plus CMR CMR = w/ Negotiated GMP CMR-GMP w/ Competitive GMP CMR-GMP GC Lump Sum .

Don’t confuse “project management methods with “project delivery” methods…they are different! Project Management Methods • In-house staff • Owner’s representative • Agency construction manager • Program manager Project Delivery Methods • Design / bid / build (GC Lump Sum) • CM at Risk with competitive GMP • CM at Risk with negotiated GMP • CM at Risk Cost Plus • CM Agent Multi-Prime .

accountability and responsibility • Maximizes execution flexibility • Controls / saves cost • Improves safety • Reduces project schedule • Eliminates redundant project management / site indirects • Focused change control .Why an EPCM Approach? • Provides a single point of contact.

Design-Bid-Build CM-Based Delivery CM Gives More Opportunity to Reduce Schedule .

Setting the Stage • Construction costs are out of control • Escalation of materials & equipment is unprecedented • Project delivery time needs to be reduced to meet customer needs • Traditional construction delivery is not conducive for teamwork and controlling cost .

Time is Money cost curve selection of delivery method CONCEPT CONSTRUCTION DOCUMENTS PROJECT LEVEL of INFLUENCE DESIGN DEVELOPMENT BIDDING CONSTRUCTION CLOSE OUT EXPENDITURES SCHEMATIC influence curve PROJECT LIFE CYCLE .

Clients Looking for Change • Control & ownership of budgets – Design and Construct to budget • Schedule-driven projects • Staffing resource challenged • Risk mitigation critical for project success • Lean execution for streamlined project delivery .

Why EPCM cost reimbursable fixed fee open book approach? • CM GMP has bad track record for increased cost • Costs are rising faster than can be forecasted • Schedule does not allow for detailed GMP early • Clients looking for integrated team by 1 firm – single point of accountability / responsibility • Client only pays for “actual” cost of project • Client wants assurance and comfort in working with contractor .

Selling EPCM Cost Reimbursable Fixed Fee Open Book Integrated Project Delivery • Requires selling outside the box • Requires passion for process • Requires courage to challenge norm • Requires discipline and strong project controls similar to lump-sum • Requires a firm like Jacobs .

energy. shipping and labor to be managed and minimized .Benefits of An EPCM Delivery Model • Integrated project delivery team • Project execution based on the “end in mind” – commissioning and turnover • High degree of cost visibility – we are “open book” • Continually tracks & informs client of real time costs • Allows escalating costs of steel.

…continued Benefits of An EPCM Delivery Model (continued) • Allows design to overlap construction • Procurement can be arranged to achieve the best value for our clients • Pre-purchase equipment detailed in final design • Allows major subcontractors to provide input to design to allow for best value in the field • Rapid response to field issues keeps project on schedule .

schedule control • Flexibility to divert or focus resources as needed for the project • Established field procedures to hit the ground running • Detailed early commissioning plans and schedules with maximum involvement of client operations and maintenance staff. as well as equipment vendors .Benefits of An EPCM Delivery Model (continued) • Quality management plan maximizes efficiency through administration. quality control. communication.

jacobs.com Visit ProMat 2011 Booth 2678 © 2011 Material Handling Industry®.donohoe@jacobs.dalferes@jacobs.For More Information: Speaker: stephen. .com Speaker: thomas. All rights reserved. Copyright claimed as to audiovisual works of seminar sessions and sound recordings of seminar sessions.johnson@jacobs.com Home Page: www.com Speaker: timothy.