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INTRODUCTION

Federal agencies typically spend some $4 billion to $5 billion annually for construction of new and substantially renovated buildings, and total spending for construction of all federal facilities in 1989 was roughly $12.7 billion (Department of Commerce, 1990). State and local governments together spend approximately another $25 billion for buildings and $71.6 billion overall each year. The products of this spending are public assets that serve a wide range of private and public purposes and have pervasive influence on the productivity and quality of life of everyone. Assuring that these products meet the highest possible quality standards is a major challenge. Purchasers of construction in the private sector face this challenge as well, and some observers suggest the challenge is being poorly met in both private and public sectors.

The Business Roundtable's Construction Industry Cost Effectiveness (CICE) Project noted quality problems influencing the



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Inspection and Other Strategies for Assuring Quality in Government Construction 1 INTRODUCTION Federal agencies typically spend some $4 billion to $5 billion annually for construction of new and substantially renovated buildings, and total spending for construction of all federal facilities in 1989 was roughly $12.7 billion (Department of Commerce, 1990). State and local governments together spend approximately another $25 billion for buildings and $71.6 billion overall each year. The products of this spending are public assets that serve a wide range of private and public purposes and have pervasive influence on the productivity and quality of life of everyone. Assuring that these products meet the highest possible quality standards is a major challenge. Purchasers of construction in the private sector face this challenge as well, and some observers suggest the challenge is being poorly met in both private and public sectors. The Business Roundtable's Construction Industry Cost Effectiveness (CICE) Project noted quality problems influencing the

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Inspection and Other Strategies for Assuring Quality in Government Construction declining productivity of the nation's construction industries.1 That group's 1983 report cited evidence of a rapid growth of ''disputes involving liability, negligence, claims for errors and omissions, and governmental citations,'' and called for better quality control. In 1984, a workshop of nearly 100 representatives of the design and construction industry, convened in Chicago under the auspices of the American Society of Civil Engineers (ASCE), agreed that "accidents, design flaws, cost overruns, and other similar problems were occurring at a serious rate."2 That group's discussions motivated ASCE to undertake development of a comprehensive guide to quality in design and construction. Regardless of current quality, facilities owners and the construction industry share a common concern for the quality of our buildings and other constructed facilities. The sponsors of the Federal Construction Council (FCC),3 government agencies responsible for managing the public's assets, feel this concern most keenly. Managers of some of these agencies find that budgetary constraints and other technical and administrative forces increasingly threaten the effectiveness of their inspection programs and thereby pose serious impediments to achieving quality. Others have delegated the inspection task to contractors and find themselves accused of abandoning all hope of achieving quality by asking foxes to guard the henhouse. The FCC agencies asked the Building Research Board (BRB) of the National Research Council to undertake a study of inspection as a means to control quality in construction. The BRB selected a committee of professionals with broad expertise 1   The Business Roundtable, 1983. More Construction for the Money, Summary Report of the Construction Industry Cost Effectiveness Project. 2   American Society of Civil Engineers, 1988. Quality in the Constructed Project: A Guideline for Owners, Designers and Constructors, Volume 1, preliminary edition for trial use and comment. 3   Sixteen federal government agencies with major interests in building and facilities research, construction, operation, and maintenance comprise the Federal Construction Council. These agencies had a combined responsibility for facilities-related budgets in FY 1989 exceeding $17 billion.

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Inspection and Other Strategies for Assuring Quality in Government Construction and extensive experience to undertake this study.4 This document is a report of that committee's deliberations. SCOPE OF THE COMMITTEE'S DELIBERATIONS The BRB's committee examined the factors that affect the need for inspection, and the extent and nature of inspection during construction, with the goal of recommending techniques for enhancing the value of inspection that will achieve more cost-effective construction of federal projects. Most federal facilities are constructed under fixed price contracts awarded on the basis of open competitive bidding. Agencies use detailed design criteria and construction specifications to describe the characteristics of materials and workmanship required, and use inspection to monitor contractor compliance. The committee met several times during a period of about one year, and heard testimony of federal agency representatives and experts in the private sector and academia. Early in their deliberations, the committee agreed that construction quality is inextricably related to design quality, and that inspection is only one of a number of methods for assuring quality in the constructed facility. More importantly, the committee found that many of the problems perceived with construction quality in the United States today are beyond the reach of inspection. While the committee's work was focused on inspection, the committee's report unavoidably touches on design and other strategies for achieving quality. In particular, the committee asserted that in their judgment major problems of quality in U.S. construction today begin in planning and design. Construction contractors are expected to deliver facilities that conform to requirements presented in drawings and specifications prepared by planners and designers. If these drawings and specifications are not accurate, complete, 4   Biographical sketches of the committee members are presented in Appendix A.

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Inspection and Other Strategies for Assuring Quality in Government Construction and clearly presented, or if they describe a facility unlikely to meet the needs of owner and users, even the most careful and conscientious construction will not deliver quality. Cost growth in construction—costs greater than were estimated in design—is one indicator of lost quality. If the design is effective in getting the requirements right and estimating accurately, then cost growth is attributable to construction problems. However, this is not often the case. One study in the private sector involving the construction of nine fast-track5 industrial projects revealed that the cost of repair or replacement (rework), an average of more than 12 percent of the total installed project costs, was attributable primarily to design errors (25 percent) and owner and designer changes (54 percent), and only 17 percent to construction errors.6 These rework costs were borne by the owner in the form of contract modifications or change orders. In the federal sector, design is generally completed prior to issuance of construction contracts. A study of projects constructed for the U. S. Army Corps of Engineers and the Naval Facilities Engineering Command (NAVFAC) found average cost growth of approximately 6 percent attributable primarily to design error (50 to 65 percent) and owner changes (23 to 35 percent).7 More recent data furnished the committee by the Corps and NAVFAC indicate that similar cost growth is still 5   "Fast-track" is the term used for projects whose construction begins before all design is completed. Fast-track procedures are used to reduce the time between start of design and construction completion. 6   The Quality Management Task Force, 1989. Cost of Quality Deviations, CII Publication 10-1, The Construction Industry Institute, The University of Texas at Austin. 7   Building Research Board, 1986. Construction Contract Modifications: Comparing the Experiences of Federal Agencies with Other Owners. National Academy Press, Washington, DC. Some agencies report that owner changes are much higher.

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Inspection and Other Strategies for Assuring Quality in Government Construction being experienced, and earlier studies show that the scale of the problem is not new.8 ORGANIZATION OF THE REPORT While the committee focused on government—particularly at the federal level—such cases illustrate that both private and public sectors share the problem of assuring construction quality. The committee's deliberations thus considered both sectors, and this report is meant to have a broad bearing on the construction industry as a whole. The following pages summarize the committee's discussions of construction quality and current practices for its assurance, highlighting the role of inspection. Chapter 2 presents the underlying principles and definitions the committee adopted for their discussions. Chapter 3 describes inspection strategies of various federal agencies and the private sector, highlighting some of the latter that are likely, in the committee's assessment, to be particularly effective for assuring quality in federal construction. Chapter 4 considers the limitations of inspection and presents selected alternative strategies to enhance inspection for assuring quality. Chapter 5 summarizes the committee's specific recommendations for achieving government construction quality. Appendices present supplemental information on topics introduced in these chapters. Quality in construction occurs through a complex interaction of many participants in the facilities development process. The committee's recommendations are aimed primarily at agency managers, but address design and construction professionals, educators, and policy makers as well. The committee agreed that quality in construction is assured only when there is a commitment to quality throughout planning, design, and con- 8   Building Research Board, 1986. Supervision and Inspection of Federal Construction, Federal Construction Council Technical Report No. 54, National Academy Press.

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Inspection and Other Strategies for Assuring Quality in Government Construction struction, and that quality facilities require that this commitment continue through operations and maintenance. Quality facilities that meet and exceed expectations—enhancing our safety, productivity, and overall quality of life—are the real goal of the committee's deliberations.