The Commercial Real Estate Revolution E-Book

Rex Miller

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 525

Veröffentlichungsjahr: 2009

Beschreibung

As it currently operates, the commercial real estate construction industry is a disaster full of built-in waste. Seventy-percent of all projects end over budget and late. The buildingSMART Alliance estimates that up to fifty-percent of the process is consumed in waste. Almost every project includes massive hidden taxes in the form of delays, cost overruns, poor quality, and work that has to be redone. Building new structures is a fragmented, adversarial process that commonly results in dissatisfied customers and frequently ends in disappointment, bitterness, and even litigation. The industry must change--for its own good and that of its customers. But while the industry has tried to reform itself, it can't do it alone. Real change can only come from business owners and executives who refuse to continue paying for a dysfunctional system and demand a new way of doing business. The Commercial Real Estate Revolution is a bold manifesto for change from the Mindshift consortium--a group of top commercial real estate industry leaders who are fed up with a system that simply doesn't work. The book explains how business leaders can implement nine principles for any project that will dramatically cut costs, end delays, create better buildings, and force the industry into real reform. The Commercial Real Estate Revolution offers a radically new way of doing business--a beginning-to-end, trust-based methodology that transforms the building process from top to bottom. Based on unifying principles and a common framework that meets the needs of all stakeholders, this new system can reform and remake commercial construction into an industry we're proud to be a part of. If you're one of the millions of hardcore cynics who work in commercial construction, you probably think this sounds like pie in the sky. But this is no magic bullet; it's a call for real reform. If you're an industry professional who's sick of letting down clients or an owner who's sick of cost overruns and endless delays, The Commercial Real Estate Revolution offers a blueprint for fixing a broken industry.

Leseprobe

Table of Contents

Praise

Title Page

Copyright Page

Acknowledgements

Foreword

Introduction

MINDSHIFT FACES THE CHALLENGE FOR TRANSFORMATION

THE COMMERCIAL REAL ESTATE REVOLUTION

Part One - The Commercial Real Estate Money Pit

Chapter 1 - The $500 Billion Black Hole

WHY THE DESIGN-BUILD MODEL IS DEAD

WHERE THE WASTE COMES FROM

LACK OF TIME

SILOS

BOILERPLATE PLANNING

SUB-TRADE COORDINATION

HIERARCHICAL DILUTION

PHASE-INDUCED IGNORANCE

NEW TEAMS FOR EVERY PROJECT

IT’S TIME TO CONNECT THE DOTS

Chapter 2 - What Every Executive Needs to Know About Low-Bid Contracting

WHAT’S WRONG WITH DBB?

PREQUALIFICATION

INVITATION TO BID

AN EXPENSIVE PROPOSITION

BIDDING IS A WASTE OF THE SUPPLIERS’ TIME AND RESOURCES

THE WINNING TEAM

THE WINNER’S CURSE

VALUE ENGINEERING

WHAT EXACTLY DOES THE WINNING BIDDER WIN?

DISPELLING MYTHS AND MISCONCEPTIONS

BOTTOM LINE

Chapter 3 - From Fragmentation to Integration

DRAINING THE SWAMP

FIXES THAT FAIL

TRAGEDY OF THE COMMONS

HOW DID WE GET INTO THIS MESS?

WHEN SYSTEMS ARE OUT OF SYNCH

THE OLD PARADIGM GIVES WAY

SHIFTING PARADIGMS

THE AMBIDEXTROUS APPROACH

CHANGING THE METAPHOR

Part Two - Making the Mindshift

Chapter 4 - Working the Mindshift

A BRIEF HISTORY OF MINDSHIFT

FLIPPING THE PARADIGM

MAVENS AND PERSUADERS IN SEARCH OF CONNECTORS

DOTS WAITING TO BE CONNECTED

SUSTAINABILITY

INTEGRATED PROJECT DELIVERY

OFFSITE CONSTRUCTION

THE VIRTUAL BUILDERS ROUNDTABLE

SUTTER HEALTH

Chapter 5 - What Does a Trust Based Project Look Like ?

SUTTER HEALTH CHANGES THE GAME

WORKING WITH THE SKEPTICS

EAST RIVER SCIENCE PARK

EMERSON COLLEGE

BIG 3 AUTO MANUFACTURER

FORTUNE 50 REGIONAL HEADQUARTERS

AARDEX

WHAT TRUST-BASED PROJECTS LOOK LIKE FOR SMALLER FIRMS

NAUGATUCK VALLEY SAVINGS & LOAN

HOW SOLIDUS CREATES A TRUST-BASED PROJECT

TOWARD A REAL CLASS A BUILDING

HOW OWNERS CAN BE CATALYSTS FOR CHANGE

THE KEYS: AN OWNER’S ROADMAP TO GETTING STARTED WITH TRUST-BASED, TURNKEY CONSTRUCTION

Part Three - Nine Transforming Keys to Lowering Cost Cutting Waste, and Driving ...

Chapter 6 - Key 1: Trust-Based Team Formation Team Formation

THE ROI OF TRUST

THE MINDSHIFT BRIDGE

HOW CONVENTIONAL THINKING GETS IN THE WAY OF COMMON SENSE WAY OF COMMON SENSE

A CASE FOR TRUST: THE BOLDT COMPANY, APPLETON, WISCONSIN

TRUST-BASED TEAM SELECTION

COMPATIBLE TEAM FORMATION

THE LIFE OF THE TEAM

INSIDE THE NEW PARADIGM

Chapter 7 - Key 2: Early Collaboration Collaboration

PSYCHO-TRACKING: KLINGSTUBBINS AND NOVARTIS

THE NEW NORMAL?

REDEFINING PROJECT MANAGEMENT

“WE REVERSE ENGINEER THE DESIGN FROM THE BUSINESS PLAN”

ITERATIVE DESIGN

LIVING IN 2D

THE DIFFERENCE BETWEEN 2D AND 3D

THINKING COLLABORATIVELY

THE LEARNING CURVE OF 3D COLLABORATION

THE VALUE OF 3D COLLABORATION

Chapter 8 - Key 3: Built-In Sustainability Sustainability

SUSTAINABILITY MEANS REDUCING ENERGY CONSUMPTION AND WASTE

MYTH TO MINDSHIFT #1: SUSTAINABILITY IS READY FOR MAIN STREET FOR MAIN STREET

MYTH TO MINDSHIFT #2: SUSTAINABLE BUILDINGS ARE COST EFFECTIVE FROM THE BEGINNING

MYTH TO MINDSHIFT #3: A BROWN COMPANY CAN PRODUCE A GREEN PRODUCT

MYTH TO MINDSHIFT #4: GREENHOUSE GASES? IT’S NOT THE CARS, IT’S THE BUILDINGS

LIGHT, AIR, AND POWER

SEEING THE CONNECTIONS

Chapter 9 - Key 4: Transformational Leadership

CLARITY BEGINS TRANSFORMATION

LEARN FROM THOSE WHO’VE BEEN THERE

CREATE A TRANSFORMATIONAL NETWORK

TRANSFORMATIONAL LEADERSHIP BEGINS AT HOME

THE MINDSHIFT TOOLKIT

Chapter 10 - Key 5: “BIG” BIM

BIM DEFINED

THE REVOLUTION TAKING ROOT

OUTSIDE THE BIM BOX

THE BIM MIND SHIFT

OUT WITH THE OLD AND IN WITH THE NEW

BIM VERSUS TRADITIONAL DESIGN

PAPER TRAIL VERSUS PAPERLESS

2D OBJECTS VERSUS 3D OBJECTS THAT WORK

DOMINO EFFECT VERSUS SEAMLESS CHANGES

CHANGE ORDERS VERSUS NO CHANGE ORDERS

RULES OF THUMB VERSUS ACTUAL MEASURE

WORK PHASING VERSUS INTEGRATED PROJECT DELIVERY

TRADITIONAL ROLES VERSUS REDEFINED ROLES

COMPENSATION FOR TIME VERSUS COMPENSATION FOR VALUE

PLUG-AND-PLAY SUPPLIERS VERSUS STRATEGIC PARTNERS

WHERE IS THE INDUSTRY?

BIMSTORM

THE FUTURE OF BIM

Chapter 11 - Key 6: Integrating Project Delivery

TRADITIONAL PROJECT MANAGEMENT

LEAN CONSTRUCTION

A NETWORK OF COMMITMENTS

DESCRIBING THE ELEPHANT

IF IT CAN WORK WITH GM . . .

IS IT WORTH THE EFFORT?

WHAT DO YOU TRACK?

GETTING USED TO NEW THINKING

THE ESSENTIALS

GETTING STARTED

THE AIRPLANE GAME

MAKING CONNECTIONS

PIECES TO THE PUZZLE

VALUE STREAM MAPPING (VSM)

LAST PLANNER SYSTEM

NO MORE SILOS

STAN GETS A FIRST-HAND TASTE

LEAN ARCHITECTS

LEAN: TALKING POINTS

THE FUTURE FOR LEAN

Chapter 12 - Key 7: Trust-Based Agreements and Client-Centered Incentives

THE CONTRACT MINDSHIFT

WHAT OWNERS NEED TO KNOW

A NEW HOME FOR GLOBAL FOODS: TRUST-BASED AGREEMENT FOR A LARGE PROJECT

SUPPORTING CHANGED WORK

TEAM SELECTION BEGINS

SETTING THE PROJECT TARGET COST

NEEDS AND WANTS

THE TRYOUT

ACHIEVING A FIVE-STAR SOLUTION

CHOOSING THE CONTRACT

INSURANCE AND LIABILITY

FURNITURE DEALER: A TRUST-BASED PROJECT WITHOUT THE BELLS AND WHISTLES

THE EXECUTIVE PRODUCER

GOING TO MARKET

CREATING VALUE THROUGH LONG-TERM RELATIONSHIPS

Chapter 13 - Key 8: Offsite Construction

A GLIMPSE INTO THE FUTURE

HOW GOOD CAN IT LOOK?

STICK BUILT NO MORE

THE ESTIMATING ROADBLOCK

THE OWNER’S ADVANTAGE

THE NEW MASTER BUILDER

THE FUTURE

Chapter 14 - Key 9: Workplace Productivity

A PRODUCTIVE WORKPLACE DOES NOT HAVE TO COST MORE

THE BIG IDEAS

COGNITIVE ERGONOMICS

VISUAL RICH ENVIRONMENTS

ASSESSMENT TOOLS

THE OWNER’S MIND SHIFT

MAPPING WORKPLACE IMPROVEMENT

CATEGORIES FOR IMPROVEMENT

CASE STUDY: HIGH-TECH TELECOMMUNICATIONS FIRM EXPANSION

JOIN THE REVOLUTION!

Appendix 1: - Mindshift Core Team

Appendix 2: - Mindshift Advisors

Appendix 3: - Recommended Reading

Appendix 4: - Website Resources and Links

Appendix 5: - Mapping the Future

Notes

References

Index

Praise for The Commercial Real Estate Revolution

New movements are transforming the building industry and there hasn’t been a single place to find them represented together, until now. In a systematic and coherent way, current inefficient processes are identified. The Commercial Real Estate Revolution is an essential road map for organizations and owners that want to transform the industry.

—Kimon Onuma, FAIA, Onuma

This is a thoughtful and wonderful read that should interest architects, designers, and leaders in the construction industry. The research is solid and leads to important strategic understanding. I recommend it to you.

—James P. Cramer, President, Design Futures Council Chairman, CEO for the Greenway Group, and Editor of Design Intelligence

The Commercial Real Estate Revolution does more than just provide us a clear view of a dysfunctional AEC industry. Rex and his Mindshift posse are leading the way for owners, design and construction professionals to develop new collaborative processes that will lead to better workplace environments that are on-time and on budget.

—Daniel Gonzales, Corporate Manager, Virtual Design & Construction Swinerton, Inc.

Anyone who has tried to manage a major construction project can readily attest to the fact that the current model fails to consistently deliver the desired results. But what could you do? An entire industry had been built, passed down from one generation to the next, around the concept of control. Yet in The Commercial Real Estate Revolution, we clearly see there is a better way, a way to run projects based not on control, but on trust. And it delivers every time.

—Randy Thompson, Area Leader, Client Solutions, Cushman & Wakefield, Inc.

The work of Mindshift is an industry innovation catalyst. The Commercial Real Estate Revolution identifies the glaring problems and lurking inefficiencies in the current process by which buildings are dreamed, planned, budgeted, designed, coordinated and built. Mindshift also advocates a common sense but revolutionary design and construction business model that is rapidly gaining supporters and will ultimately add tremendous value to clients. Architects, engineers, and contractors: take notice and prepare to mind shift.

—Bradley H. Thomas P.E., MBA, CEO, Progressive AE Grand Rapids, MI

Anyone involved in the construction industry needs to read and understand the ideas and principles presented in this important book to remain viable in the built environment. Business as usual will not work or be of value to owners and to society in the near future.

—Ray Lucchesi, Principal, Lucchesi Galati

The Boldt Company continues to lead the industry in helping develop transforming trends. The Commercial Real Estate Revolution does an excellent job of explaining these trends and their importance for all of the project stakeholders including the owner. The book provides a better understanding of the challenges associated with traditional project delivery and a deeper appreciation for the emerging trends within the industry. A must read for ALL stakeholders.

—Dave Kievet, Group President, California Operations, Boldt Construction

Owners want high design, speed to market, flexibility, and green initiatives—all at predetermined value. The current delivery model forces the industry to trade between these values. An adversarial and fragmented system will never be able to pull these together. It is time to change the rules to allow and support trust-based teams who can deliver on these demands. The Commercial Real Estate Revolution provides several examples of owners and project teams who have changed the rules—the results will make you sit up and take note. The book describes a growing movement delivering buildings that please the owners and are rewarding to all involved. It’s a true Win/Win model.

—Ric Nelson, Vice President, Development Services, Transwestern Commercial Services Central Region-Dallas

The Commercial Real Estate Revolution rings the bell, and it must be answered. The collision of this game-changing economy with the large, slow, inept construction industry machine offers a perfect backdrop for the basic Mindshift message—rebuild the entire system, now! I am listening.

—David Dillard, President, CSD Architects

The Commercial Real Estate Revolution sets the table for radical improvements within the world of real estate development. Change is hard, but by exploring the principles outlined in this book, I believe we’ll find better solutions in these rapidly changing times—more collaborative, more cost-effective, more integrated, and more innovative.

—Dean Strombom, Principal, Gensler

Finally, someone has actually taken the time to think about how we build things—or rather how we should be creating the buildings of the future. Every project needs to be examined in the light of many of the ideas and experiences in this The Commercial Real Estate Revolution. It is the work of experienced and thought provoking professionals. The only remaining question is, “Will we listen?”

—Larry Fees, President, former VP Real Estate, Compuware Great Lakes Renaissance Group

The Commercial Real Estate Revolution is a great introduction to the project delivery process that is based on trust. The industry is calling it Integrated Project Delivery. This book outlines the concepts that must be in place for this new delivery process to achieve its maximum potential.

—Greg Wilkinson, LEED AP; CEO, Hill & Wilkinson General Contractors

Copyright © 2009 by Rex Miller, Dean Strombom, Bill Black, and Mark Iammarino. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

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eISBN : 978-0-470-52370-4

Acknowledgments

Writing is a solitary endeavor, but The Commercial Real Estate Revolution is a true collective effort. More than 50 individuals played important roles putting together a book that covers such a wide range of trends and disciplines. I will do my best to name those who deserve credit but will likely overlook some simply due to the scale of the project.

The Mindshift experiment begins with Dick Haworth’s willingness to invite a group of respected leaders together to discuss the current and future state of the industry. Art Gensler offered to host that first meeting in their Houston offices, and through those two leaders the dialogue began. Christine McEntee (executive director for the American Institute of Architects) affirmed the value of our effort and joined us in Chicago and allowed us to tap into Markku Allison for coaching and guidance throughout the process. Peter Davoren added Turner Construction’s weight behind the initiative and from there the interest and momentum grew.

The hard work took place during our retreats in Houston, Chicago, Calgary, Dallas, and Denver. Kyle Davy led some of those sessions that took us through the difficult process of layering away preconceptions about how the industry really works, how we think it should work, and what we thought of each other. That process opened us to discovering a new way to think about our industry and future. The greatest thanks go to those who invested time and resources to attend the retreats, not hold back, ask hard questions, hold each person accountable, and push beyond readymade solutions. They include Mark Iammarino, Dean Strombom, Bill Black, Craig Janssen, Mabel Casey, Ray Lucchesi, Mark Charette, Les Shepherd, Marilyn Archer, Susan Szenasy, Ric Nelson, Ben Weeks, and Lydia Knowles.

Our discovery led us to several experts, advisors, and coaches who helped us understand the scope of this revolution and just how fundamental the mindshift is. I would like to thank George Zettle, Kurt Young, Gary Hamor, Dan Gonzales, Will Lichtig, Vince Chapman, Andy Fuhrman, Tim Springer, Tim McGinn, Andrew Fisher, John Paul Beitler III, Mike Wolff, Stephen Jones, and James Timberlake.

I want to thank several who shared the details of their breakthrough projects and how those lessons tested our assumptions and revealed common themes for successfully transforming future projects and the industry. Those include David Thurm, Dean Reed, Bob Mauck, Scott Simpson, David Kievet, and Larry Fees.

I also want to thank many who followed our blog and got into the act by reading and commenting on our early drafts or shared a cup of coffee to offer their insights. They include Larry Canfield, Tyler Adams, Monte Chapin, Kevin Kamschroer, Carl Chinn, Bob Theodore, Wes Garwood, Peter Paesch, Steve Fridsma, Cathy Hutchison, Raymond Kahl, and Cliff Bourland.

I would like to thank my three co-authors: Mark Iammarino, Dean Strombom, and Bill Black. They were venturesome enough to take the message on the road, speaking at conferences and at several other venues. The feedback they received showed us important gaps or questions we needed to address. Their expertise and ongoing consultation through the book has shaped its content and tone.

All of these people have been very generous and open with their time—sending articles, providing interviews, proofing draft chapters, taking spur-of-the-moment calls and answering questions, and tolerating (and responding to) a barrage of requests. All who participated expressed a common interest in producing a well-written, well-documented account and map of the revolution transforming the commercial real estate industry.

I also want to thank some good friends who patiently listened to these ideas take shape for the last three years, and helped probe and test them over many breakfasts. They include David Dillard, Greg Wilkinson, Doug Harden, and Randy Thompson.

I turned to Naomi Lucks, the editor for my first book, The Millennium Matrix, to help me complete this on time and to provide the wonderful developmental editing work she is so gifted with. She coached me through the process and kept me on track.

I would like to thank my wife, Lisa, and our three children, Michelle, Tyler, and Nathan, for allowing me to hide away in my office for three months to compile and write the book. Their support and interest provided encouragement to put in the hours needed in the short timeframe.

Richard Narramore, with John Wiley & Sons, provided the strategy and framework for writing the book. He very quickly found the meat of the book and provided clear direction on what to eliminate. I enjoyed his coaching and his economy to conveying strong content.

Finally, I want to thank Haworth for supporting my efforts and allowing me to focus on the Mindshift project and on writing this book. They provided the ideal context for support. They are genuinely interested in seeing our industry transform and to realize its potential—for the benefit of building owners and for everyone who works in the industry. Haworth’s leadership recognizes how dramatically the world and business are changing, and how important it is that we adapt. There is nothing more fulfilling than to wake up to a meaningful mission and do so for a company and people who appreciate your contribution.

—Rex Miller

Southlake, Texas

Foreword

Imagine work relationships built on trust, supported by technology, and aided by collaboration. In the twentieth century this seemed like an idealist’s dream. But for those of us who like to envision better ways of getting things done, this dream was always alive. It was just hard to find really good examples of it. Now—as this book proves—we are seeing the realization of our dreams.

We are also witnessing a momentous shift into the new century. The timing for this shift is urgent. Our systems, based on the old industrial model that has served us well for more than a century, are facing calamitous post-industrial stresses. They are becoming increasingly unworkable in our networked world. Our beleaguered economy, dangerously polluted environment, and worldwide competition for limited materials spell out the urgent need for a new approach.

The building industry may present the best case study for how the twenty-first century can work. With its potential for productive collaborations between architects, designers, engineers, developers, construction companies, subcontractors, furnishers, and others, it can unite hitherto adversarial professionals around a common goal.

Today, these groups have access to mature electronic software and hardware systems designed to work for teams who solve problems across time and space, and streamline the way buildings are made and furnished. These bring us a good distance toward changing the way we work. But our industry needs more than a tech fix.

It’s the human element that needs our full attention today. How can an array of strong personalities, all used to working self-protectively, become members of a smoothly functioning integrated team based on trust? How, for instance, can an architect who sees her design as being compromised by the developer, the engineer, and the subcontractor learn to work productively with these specialists? How can an owner used to seeing project after project come in over budget, over schedule, and in danger of litigation believe that a trust-based team can even exist?

The teams whose stories are told in this book—and the successful projects they brought in on (or under) budget and on schedule—are the outriders of the building industry. Like those brave scouts who galloped ahead of the westward-moving wagon trains, the individuals on these teams had the interest of the group in mind. They learned to put aside differences because they wanted to learn how to make better, sustainable buildings—ones that are resource- and energy-efficient as well as healthy for their users. Along the way, they learned how to put together a realistic budget, work flexibly together to make adjustments in real time, and meet deadlines without budget overruns. Their experience shows that building on trust is the foundation of design and construction for the twenty-first century: better, more efficient, higher-performing structures that fit the financial, social, environmental, material, and cultural conditions of the twenty-first century. It really can be done.

The groundbreaking book you hold in your hands right now gives you everything you need—the understanding, the principles, the tools, and the encouragement—to change your mind about what’s possible, and to begin changing the world.

—Susan S. Szenasy

Editor in Chief, Metropolis Magazine

Construction plays a vital role in the nation’s economy. Owners have growing demands to manage real estate cost, improve quality, and deliver sustainable buildings. However, we are an industry divided by disciplines, traditions, contracts, and old habits. This fragmentation produces lower trust and increased conflict that gets in the way of all of our efforts. Owners want more and they deserve more.

Turner accepted the invitation with an open mind to participate in the first Mindshift meeting in Houston. We knew there would be a broad cross section of leaders that we normally do not have a chance to sit across the table from. We also heard that the leaders attending shared similar concerns and interests for improving how our industry works together. The candor and insight reached during those two days produced a mutual interest to dig deeper into some of the problems that we commonly face and explore promising trends.

The Commercial Real Estate Revolution is an important contribution to the current dialogue about the future direction for the industry. The book offers two years of our collective effort to deal with the questions raised during that first meeting. In our work together we identified nine trends that are reshaping our industry. We also discovered common themes that offer an organizing framework for a future that can replace fragmentation with integrated team efforts and high performance results.

—Peter Davoren

President and CEO, Turner Construction

I think we can all agree that everyone associated with the building industry wants to create great spaces. We crave beautiful design. We ache to create buildings that reach their potential. We love it when a space comes together on time and delights the customer with its aesthetics, its function, its furnishings, its sustainability, and its price tag.

So if everybody working on buildings has essentially this same commitment to excellence, why does the process so often go horribly wrong? Why do customers end up with bad spaces that don’t function well and cost far more than they should?

As the leader of a global company that designs and manufactures commercial building interiors—including raised floors, moveable walls, systems furniture, seating, wood and steel casegoods—I’ve asked myself that question countless times. I’d venture to say that Haworth has created more than our fair share of great spaces. But it’s rarely easy. It’s characteristically painful. And the process often leaves me thinking, “There’s got to be a better way.”

Enter Rex Miller and his revolutionary ideas about commercial real estate. When he approached us with the concept, I was excited about the possibilities it offered to literally change a basic paradigm in the building industry and give us a decent chance to do a better job for our customers, ourselves, the broader economy, and the environment. This book contains that essence: a blueprint of new and better ways of working together as an industry.

In working with our customers to create world-class buildings, Haworth has had the privilege of partnering with many of the world’s most outstanding architects, contractors, interior designers, real estate developers, dealers, facility managers, and owners. But what would happen if instead of functioning as a loose coalition of quasi-competitors, we truly collaborated on projects from beginning to end, with the customer as a full partner? Here’s what would happen: Better projects. Lower costs. Happier customers.

Achieving such a seismic shift will require trust, collaboration, and effort. For a start, the executive leaders of all the players must set the right vision for the project team. As leaders, we are the only ones who can break the destructive bid environment that lurks at the heart of conventional thinking. We must agree upon a clear set of project objectives to help our employees become more effective. Those objectives should include achieving strategic alignment with the owner/ occupant, developing realistic budget parameters, agreeing on the project’s sustainability, and setting a clear expectation that partnerships will begin early and carry through to completion.

As an early adopter of lean thinking and total quality management, Haworth has been in sync with these forward-looking ideas since at least the 1970s. Rex has now articulated them in a way that could benefit our entire industry. We look forward to partnering with organizations who embrace this collaborative approach to improving our industry.

Haworth is excited to be a supporter of this much-needed shift in thinking. After you read the book, we hope you are, too. We know that this new way of working will help create better, more sustainable and pain-free projects that wow our customers and make us proud to be a part of them.

—Richard G. Haworth

Chairman Emeritus, Haworth, Inc.

Introduction: The Money Pit

We are proposing a radical change in the way we build.

—Rethinking Construction: The Egan Report

In the 1986 movie The Money Pit, Tom Hanks’ and Shelly Long’s characters pour buckets of money into a disastrous and never-ending home remodel. Back in 1948, the Cary Grant comedy Mr. Blandings Builds His Dream House told a similar tale of high hopes that are quickly dashed by real estate renovations. But it’s not only homeowners who laugh through their tears at these films: The familiar story of unforeseen building nightmares touches a well of deep emotions with anyone who has ever been involved in a construction project. The conditions of poor quality, cost overruns, and late projects are just the obvious symptoms of an increasingly dysfunctional industry. Randy Thompson, a construction manager for the global real estate firm Cushman Wakefield, summarizes this situation well: “The current system causes good people to do bad things.”

Jokes reveal another symptom and insight into a dysfunctional system. Here are some fun definitions for many of the key stakeholders in construction.

• Contractor: A gambler who never gets to shuffle, cut, or deal