We Need a Construction Leadership Forum

Our St. Louis construction industry is built on traditions and relationships. Unfortunately those traditions and relationships have become tarnished and fractured in the past few years. Bluntly, what worked in the past is no longer working. Change is necessary if we are to have any possibility of recovery and growth.

A combination of issues has effectively stalemated our ability to recover from the current construction recession and has opened our market to further deterioration, both in loss of business to other areas of the country and to the entry of national contracting and design entities from other markets into the St. Louis area.

One of the most effective ways to begin change is to openly and candidly address the issues at hand with dialogue and with the presentation of statistical evidence. Individual constituencies such as construction consumers, general contractors, subcontractors, and designers have done admirable jobs of attempting to address the issues through their programming and communication. But while there has been a lot of discussion about "best practices," new approaches, and collaboration, where the rubber meets the road we are an industry more divided against itself than at any point in decades.

Here are some of my recent, admittedly random, observations about the need for something to change:

• At the November meeting of the American Society of Professional Engineers, John Grady, senior BIM technician at McCarthy demonstrated the ways in which BIM information can inform and streamline the construction process. Despite the impressiveness of the technology, the thought that came foremost to my mind was that the potential of this rich flow of information is wasted unless an open, trusting, collaborative environment exists in which it can be shared.

• Shortly before writing this column I had a discussion with some young project managers who truly believe in taking the high road in being open and honest in competing for work and in collaborative relationships with owners and other team members once the work is won. These young men believe that honesty and collaboration will prove out in the young run. But they have become truly disillusioned by the amount of "gaming" that takes place in today's construction bid and project management environment.

• Steve Bannes, director of the Sever Institute graduate studies program in construction at Washington University told me that he recently asked students in one of his classes how many felt that playing the flexible ethics game was part of the construction process. The disheartening number of students who agreed that taking the low road surprised Bannes.

• A recent CNR enews/website article "All Low Price Buys is Changes Orders" served as a catalyst for lively discussion both online and in person. The article was an interview outlining the viewpoint of author Bill Black, who came to St. Louis to share his perspective on the current price-focused bid market with commercial real estate and design industry representatives. For two weeks after the article ran a lively online and offline discussion of the issue ensued. It is this kind of change-related dialogue that I believe that our industry is currently lacking. I encourage you to check out the article on the CNR website.

There has been no single point of dialogue or repository of information regarding these issues. The leadership forum which I am proposing would attempt to address that need with work products which would include, but not be limited to, the following:

• Annual or bi-annual executive-level "leadership summits"
• A website with
• downloadable summaries of the summits
• industry statistics
• blogs on industry issues
• discussion forums
• webinars on forum topics
• A regularly circulated e-newsletter
• Position papers on key issues facing the industry (downloadable)
• University graduate and undergraduate research on local industry issues (downloadable)

University construction study programs at Washington University and SIUE could be involved in vetting and assisting with the development of programming for these communication channels. The goal would be to create an objective presentation of the facts which has the necessary credibility to reasonably assess the current situation and to affect change. A steering body representing the gamut of the industry would help to direct the evolution of the effort.

The primary issues which need to be addressed directly and candidly are:

• Labor issues: The role of unions historically and in the future needs to be examined candidly, in light of the current state of the industry. Unions have provided a stable, trained work force for the St. Louis area for over a century. They have, in effect, created an environment that has largely been closed to contractors from outside the metropolitan area.

• Project Award Environment: Two years ago the industry appeared to be entering a new environment of process for project awards. An increasing amount of work was being awarded on a negotiated basis. Integrated Project Delivery was at least being explored, if not practiced in reality. Now the "buyers' market" for construction is creating an acrimonious climate in which price is the primary determinant of project awards. Incomplete scopes result in change orders, and contentious project management. The subcontractor/general/owner relationship is more fractious and distrustful than it has been in decades.

• Political Divisions: The large number of political entities in the metropolitan area and parochialism among those entities has long been an impediment to development and construction in St. Louis. While this forum cannot change the political infrastructure of the St. Louis area, it is possible that a factual presentation of the effects of political fractionalization on the construction environment can at least result in communication leading to a more building-friendly political environment.

• Inclusion: Despite the best efforts of AGC, SLCCC and other organizations the reality of including MBE/WBE organizations in the market, who does and does not qualify as MBE/WEB and what inclusion looks like when it's really happening has become increasingly muddied. Further, the current contentious bid fray and the variety of programs that institutional and corporate buyers are creating make it difficult for industry firms to build cohesive inclusion policies.

I have been in discussion with association and educational leaders and have received their support for this St. Louis Construction Leadership Forum concept. CNR would take an active role - working with the associations and educational institutions in developing the events and electronic communication tools.

I'll update you as plans for this concept become more concrete. I invite your comments and input.

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