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Inspection and Other Strategies for Assuring Quality in Government Construction 3 EXTENSIONS AND ALTERNATIVES TO INSPECTION Quality facilities—buildings and other construction that protect and enhance safety, productivity, and overall quality of life—are achieved through a complex interaction of many participants in the facilities development process. Inspection is one important and effective tool that serves the task of assuring quality, a tool that has evolved and continues to change in parallel with construction practices. Within the context of these practices, there are extensions and alternatives to inspection that federal agencies may use to improve their ability to achieve quality facilities. The committee drew on its assessment of agency and private practices and the knowledge of the committee's members to suggest what these extensions and alternatives are and how they can be used. TOTAL QUALITY MANAGEMENT IN CONSTRUCTION While they do not fault specifically the practices and achievements of any of the federal agencies' quality manage-
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Inspection and Other Strategies for Assuring Quality in Government Construction ment activities, the committee points out that many participants and observers of U. S. construction believe that the industry as a whole has serious problems. As discussed in Chapter 1, both the private and public sectors share these problems, experiencing serious cost growth due to a lack of quality. Industry groups such as the Business Roundtable, the Construction Industry Institute, and the ASCE have documented that the quality of the industry's work has declined in recent years and that the nation's productivity and international competitiveness have suffered. According to the director of the Construction Industry Institute, recent studies have shown that more than one-third of our current projects fail to meet budget objectives, a similar proportion finish behind schedule, and only about 80 percent meet technical objectives (Tucker, 1990). Industries cannot survive on such a low rate of satisfactory product delivery. The industry has begun to work for change. A theme originated by U. S. consultants and educators W. E. Deming and J. M. Juran and adopted wholeheartedly in Japan—Total Quality Management (TQM)—has been gaining increasing popularity in the U. S. construction industry (The Quality Management Task Force, 1990). TQM is an organization-wide effort to improve performance that involves everyone and permeates every aspect of the organization to make quality a primary strategic objective. TQM is achieved through an integrated effort among personnel at all levels to increase customer satisfaction by continuously improving current performance.25 The quest for continuous improvement, one of Deming's "fourteen points," has in fact become a keystone of Japanese practice.26 Staff at all levels are encouraged to remain vigilant, to bring opportunities for improvement to managers' attention. Improvements occur through a team effort to assess, adapt, and apply all suggestions for enhancement of product, process, or service. 25 A brief discussion of the principles of TQM are included in Appendix D. 26 The Japanese have a word, keizen, for this practice.
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Inspection and Other Strategies for Assuring Quality in Government Construction Then-Secretary of Defense Frank Carlucci stated the DoD's recognition of TOM in a 1988 memorandum. ". . . I am giving top priority to the DoD Total Quality Management (TQM) effort as the vehicle for attaining continuous quality improvement in our operations, and as a major strategy to meet the President's productivity objectives under Executive Order 12552." The committee believes that all federal agencies should implement TQM throughout the life cycle of their construction projects. TEAMWORK AND QUALITY One key aspect of TQM is teamwork, an integrated effort by all participants in the construction process to produce a quality building. A major conflict between current practice and TQM is the adversarial relationship among owners, designers, and constructors established by traditional inspection-based QA programs. This relationship—which can become especially severe if third-party professionals27 are responsible for QA inspections—has the unfortunate consequence that participants become concerned primarily with avoiding blame when construction documents, constructed facilities, and owner's needs are poorly matched. These participants then feel little incentive to anticipate, prevent, and help to resolve such disputes when these mismatches arise. Greater teamwork for most government agencies would mean an increasing role in the construction phase for the architect or engineer who designed the project. Rather than viewing this increased role as a substitute for the agency's staff who traditionally have performed construction inspection on federal projects, the A/E and agency staff would complement one another, the former focusing on the project's technical 27 Such professionals could be members of the owner's organization, who were not involved in the building's design, or an A/E firm or other consultant providing QA services.
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Inspection and Other Strategies for Assuring Quality in Government Construction requirements and the latter responsible for administrative procedures. The details of staff roles should be responsive to characteristics of projects and agencies. Teamwork extends to the construction contractor as well. Current laws and regulations governing federal agency construction make it difficult to reward good contractor performance with preferential or non-competitive award of future construction contracts. The reward of future work and lasting business relationship, common in the private sector, is an incentive for excellence that reinforces a quality contractor's own pride of workmanship. However, the government contractor must compete in the same way for new federal work, regardless of past quality or level of performance, and so needs only to perform adequately to prosper. CONTRACTOR PERFORMANCE EVALUATION While preferential treatment in bidding for future work is not readily available, federal agencies can develop mechanisms to strengthen construction contractors' incentives to deliver quality. Section 36.201 of the FAR requires agencies to prepare performance evaluation reports.28 The DFARS also require that all DoD agencies forward these reports to a central data base maintained by Corps' North Pacific Division. This data base, called the Construction Contractor Appraisal Support System (CCASS), is the result of a July 1986 memorandum by the Chief of Engineers to the Under Secretary of the Army and has been on-line since July 1987. At the end of 1989, there were more than 13,000 reports on nearly 10,000 contractors in the system, with ratings assigned as outstanding, satisfactory, or unsatisfactory. (Of 13,251 final evaluations, 7.0 percent were outstanding, 84.2 percent satisfactory and 8.8 percent unsatisfactory.) 28 Using Standard Form (SF) 1420.
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Inspection and Other Strategies for Assuring Quality in Government Construction In addition to the data base, the system includes periodic analysis of contractor performance and interim appraisals. Unsatisfactory appraisals are used to motivate the contractor's management to take corrective action. The Corps has also established29 a board to review CCASS data for initiation of debarment actions, and revised the EFARS to require contracting officers to make a determination on pursuit of debarment action for each final unsatisfactory performance rating. There have been three performance-based debarments and three more were under review in early 1990. Adoption of such a process, including coordinated data exchange, uniform policies, and consistent enforcement by all federal agencies could become a powerful tool for more effective quality management. BIDDER PRE-QUALIFICATION Even in the absence of past performance information, prequalifying contract bidders is a useful quality management tool. It should be more widely used. Criteria for pre-qualification of contractors can include requested references testifying to the bidders management quality and financial strength, visits to the contractors' recently completed projects, and contractors' presentations of their work. The pre-qualification procedure may continue after bids are received by holding interviews and additional reviews. This practice is sometimes criticized as "bid shopping"—inviting a contractor to underbid another's offer—but the committee finds that most contractors will accept this process as a reasonable business procedure. 29 Under Engineer Regulation (ER) 15-1-29.
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Inspection and Other Strategies for Assuring Quality in Government Construction INCENTIVE CONTRACTING Incentive contracting, widely used in the private sector, is a system whereby the contractor receives a bonus for performance above some pre-agreed base or norm, and is penalized for performance below that base. Such factors as cost, schedule, quality, safety, responsiveness, and management effectiveness may be negotiated as a basis for incentive payments, and amounts in the range of 0.33 percent to 1.0 percent of the construction cost are typical. In the committee's view, experience and research have shown that positive incentives for good performance are more useful than penalties for failure to meet targets. For such incentives to work, the plan for their use must be simple. Reward should be commensurate with the risk the contractor is asked to accept, and all participants must be committed to the success of the incentive plan and continuously act in each other's best interest. Incentive awards therefore work best when they are passed along to subcontractors and craftsmen on the project. The plan must be such that if one party to the agreement wins, all win. The incentive payments should be viewed not as additional costs, but rather as part of the savings achieved by the owner when the contractor performs particularly well. Use of as much quantitative measurement as is possible, consistent with making the plan simple, facilitates administration of the incentive contract. A team is formed to oversee evaluation and award of incentives, with equal representation by the contractor and owner. A higher level management team, also with equal representation of both parties, is formed to resolve disputes that may arise. In practice, the evaluation team typically reconciles differences rather than reporting to their superiors that they cannot arrive at a decision. INTEGRATED INSPECTION PLANS When construction is supervised by an organization other than the user, disagreements and user dissatisfaction can arise
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Inspection and Other Strategies for Assuring Quality in Government Construction during construction because inspections for quality assurance do not adequately address the users concerns. The integrated inspection plan (1) has input from the design, construction, and inspection organizations, (2) documents their concurrence in the plan, and (3) contains mutually agreed upon criteria for acceptance or rejection of work. Although the construction contractor is not generally involved in formulation of the plan, it is important that the contractor both understand the contents of the plan and recognize that the engineering, construction, and inspection organizations concur with it. An integrated inspection plan helps dispel a contractor's concerns about inspectors over-inspecting, an owner's concerns about the constructor's preferences for meeting schedule at the expense of doing the job right, and the designer's inclination to view a job as finished when the design is delivered to the owner. Potential sources of dispute surface during the review of the inspection plan and are resolved prior to the actual performance of work in the field. Like any other formal and consistent inspection plan, an integrated plan helps to assure the uniformity of inspections from one inspector to another and reduces the frequency of office consultations to review standards for acceptance of work. COST AND SCHEDULE PROTECTION PLANS The cost and schedule protection plan is a management tool intended to prevent problems that pose threats to cost or schedule due to the lack of conformance to required workmanship or material characteristics. Prior to construction, inspection personnel review construction schedules and specifications to identify those activities that can cause quality problems that may adversely affect the cost or schedule. These activities, termed ''quality critical,'' typically have one or more of the characteristics listed in Table 3.1. Quality-critical activities are included in the cost and schedule protection plan, which identifies the specific critical work-
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Inspection and Other Strategies for Assuring Quality in Government Construction TABLE 3.1 Indicators of quality critical activities (Source: committee experience) Activities are likely to be quality critical if they are - on the critical path or an accelerated schedule - repetitive and a generic defect or fault would necessitate many repairs - very labor-intensive to repair - an intensive user of expensive or hard-to-get materials - critical to facility operation - likely to be inaccessible for repair - historically a problem or source of high reject rates - dependent on high skill levels or certifications - dependent on special processes such as heat treating - subject to approval by outside organizations - complicated by specification, drawing or interface ambiguities - a user of in-place storage, temporary construction shoring, tracing, or weather proofing that could lead to damage of expensive equipment and materials - dependent on highly stressed and structurally significant components, high energy fluid systems, or other components whose failure would create life-threatening hazards to personnel manship, processes or materials and the hypothesized modes of failure which are the most probable sources of quality failure. The applicable criteria for judging the risk are then specified and the inspections and tests needed to manage this risk are scheduled. Finally, the plan designates the persons or organizations responsible for inspections, tests or other actions designed to monitor activity and provide early warning of impending problems. When conditions arise that may threaten the cost and schedule, the inspection organization immediately notifies the construction organization and recommends corrective actions and recurrence control. Timely detection of unacceptable conditions precludes further wasteful processing of defective work and greatly reduces the costs and delays associated with repairs.
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Inspection and Other Strategies for Assuring Quality in Government Construction Through early detection, a larger percentage of craft man-hours are spent on work that meets specifications the first time. NEW TECHNOLOGY FOR INSPECTION Emerging tools and procedures that utilize modern electronics, computers, and other technologies new to the field of construction quality control and assurance may in coming years revolutionize the industry. The task of inspection will be accomplished more quickly, using less labor, and yielding more reliable information about the quality of construction in-place. Federal agencies have much to gain from such improvements and can foster their development through research and demonstrations in the field. For example, research on how the electrical and chemical properties of Portland cement concrete change during mixing and curing may lead to inspection methods that replace slump tests30 at the time of placement and compressive strength testing of cylinders days after the concrete is placed. Transmission and resonance behavior of structural members, roof coverings, and wall sheathing materials (brick and other masonry, in particular) exposed to sonic and radio-frequency waves may become the basis for monitoring for voids and failures to achieve bonding at the interfaces between different materials. Computers and communication technology are enhancing both constructors' and owners' abilities to review inspection data and monitor construction performance. A voice-mail system developed by the Army's Construction Engineering Research Laboratory permits inspectors to telephone their reports to a central office for typing and review, enhancing the speed and accuracy of inspection reporting. Laptop and hand- 30 Slump is a measure of a physical characteristic of the still-plastic concrete mix, that indicates the workability of the mix and correlates broadly with later performance of the cured and finished concrete.
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Inspection and Other Strategies for Assuring Quality in Government Construction held computers are used in the field to facilitate access to design data and previous inspection information. Development of expert systems software will supplement the inspector's judgment in quality control. Already in use are electronic surveying and leveling devices that have improved dramatically the dimensional accuracy of construction. These devices are also yielding benefits in faster construction because less time is required to tailor components on site to fit idiosyncratic results of preceding stages of construction. Such results—improved accuracy and construction time—assure true and unambiguous improvements in construction quality. QUALITY MEASUREMENT SYSTEMS The Construction Industry Institute has developed a Quality Performance Management System (QPMS), which classifies and tracks the costs of quality during the design and construction of projects.31 This management tool is designed to determine what quality management activities and deviation categories are involved in a project and to ascertain when (i.e., during which project phases) the quality management activities and deviation costs occur. The manager is helped to discover why the deviations occur and to learn how the rework relates to the quality management. The tool thus can provide cost-of-quality information to establish baselines and identify opportunities for improvement, without providing either too much or too little detail. Appendix E summarizes principal elements of the Quality Performance Management System. 31 The Quality Management Task Force, February, 1990. The Quality Performance Management System: A Blueprint for Implementation, Publication 10-3, The Construction Industry Institute, The University of Texas at Austin.
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Inspection and Other Strategies for Assuring Quality in Government Construction References The Quality Management Task Force, May, 1990. Total Quality Management: The Competitive Edge, CII Publication 10-4, The Construction Industry Institute, The University of Texas at Austin. Tucker, Richard L., May 1990. "The Big 'Q'," "Perspectives," The Construction Specifier, Volume 43, Number 5, 151–152.
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