Public organizations have a Capital Plan that lays out the government’s Capital investment building priorities over a time horizon of 1 to 5, and even 5 to 10 years. Each project submission is completed with a Business Case to support the investment and to align with government’s priorities for service delivery to taxpayers. Capital Plans are updated annually to capture more detailed input, costs and/or realigned priorities.
Needs, Goals, Constraints
A Business Case is typically the document articulating the project service delivery Needs, Goals and Constraints – what the built item (building, roadway, bridge) is intended to support – the value, the cost, return on investment (ROI), and timeframe to finish. The Business Case with the Owner's Project Requirements (OPR) typically includes a Functional Program, often prepared as part of a design report by an architect / engineer / design consultant, and for a building project, includes the following:
The Owner’s values, goals, and desired image,
Community goals and concerns,
Sustainability and environmental goals - i.e. Net Zero, LEED,
Life-cycle and total cost of ownership goals,
Site requirements such as parking, circulation, and orientation,
Space requirements for the building – usually based on Space and/or Design Standards,
Definition of the activities which will take place in each space,
The functional relationship and adjacencies of the spaces, and
Special technical requirements of each of the spaces and the building systems – Furniture, Fixtures & Equipment (FF&E)
The OPR will also include various constraints such as:
Financial and cashflow requirements with a preliminary budget,
Scheduling and time frame for the project,
Regulatory issues such as zoning and building code requirements,
Project impact on daily business operations, and
Authorities Having Jurisdiction requirements.
Often, Owners engage Quantity Surveyors to produce a cost estimate that is used to seek approval for the project budget. Cost estimates are usually high-level and based on similar recent projects and associated costs.
This is all critical information that helps set the project scope direction and guide the project players in their work.
However … is this adequate?
The following chart illustrates the common factors that traditionally cause project uncertainty and risk – as articulated in another recent article.
Owner Causes of Uncertainty/Risks
"The top uncertainty-related risks, according to architects and contractors, are Owner-driven changes, and the need for clearer direction from Owners."
From an Owner's perspective, they deal with a range of internal stakeholders (boards, Finance officers, Politicians, administrators, end users, operations staff, neighbours etc.) as well as changing external forces (market conditions, regulations, technology advances, personal etc.).
It is difficult to identify and provide absolute information in that stakeholder diversity.
Organizations are dynamic. It is always challenging to control scope during the project timelines using traditional methods. Since the mid-20th century work space has been used as a hierarchal class differentiator and reward perk. The enclosed office versus open office, the corner office with windows versus the interior cube farm. Bigger is better, is more important – a strong visual of status differentiated. The most important space is my space. And how does technology impact work-flow?
It is unrealistic to expect all Owner stakeholders to understand how to articulate their technical, work-flow or operating requirements to designers or constructors. And frequently, stakeholder requirements may be in conflict with each other. This issue is a project communication constraint.
LEAN project delivery offers better methods and tools for problem solving and communicating information leading to better project results.
The old design adage – Form Follows Function - is supported by Value Stream Mapping (VSM) stakeholder work processes or taking the LEAN planning approach using the – People, Preparation, Process (3P). Both methodologies place the value on the customer – recipient of the stakeholders’ work – as the measure of efficient work flow. Space and buildings should support this workflow.
Why is this important?
Clearly defining the scope of a project and identifying constraints is the foundation of project success. It is the basis for guiding the design & construction solutions, setting the budget and determining the schedule. If your project scope is undefined or fluid when you start – your risk of ‘blowing’ the budget, missing the schedule and compromising the value required is escalated.
So, how best to nail the Owner’s Project Requirements (OPR)?
LEAN Learning from the project site:
Start by building your internal stakeholder team. Include:
a varied representation of the workers who will use the space,
customer representation (e.g. healthcare patients),
Facility Management staff,
a seasoned procurement practitioner, and
a rep from the capital Finance group.
Depending on the type of project, also on-board the experts for assembling required data (site soils, hydrology, perhaps transportation, construction costs, Furniture, Fixtures & Equipment FF&E, etc.).
With the data assembled, finalize stakeholder value propositions so you know what problems the project needs to solve. The design process shouldn’t need to guess what is of primary importance on a project. But don’t determine design solutions - this stage is not design.
The OPR should:
Be clear on the Problem definition. (For example, the Moose Jaw Hospital project wanted to improve on patient wait times and improve information flow around patient care. That was their Problem definition.)
Be clear on desired Value (involve stakeholders in Value Stream Mapping & 3P exercises to create a Current State & Future State work process flows and agree on design criteria
Provide an estimate of cost and maximum budget
Review project Risk & update as the project progresses
Suggest how long the project should take, or more specifically, when you need the project to be complete
Be clear on how the Owner will make decisions (draft a project RACI Chart), and
Determine the requirement for technology (BIM, PM software, etc).
Value Stream Map Example (wikipedia)
Spaghetti diagrams are useful to visualize time/motion of various stakeholder work and distance traveled – to determine improvement opportunities.
Spaghetti Diagram Example (Summit Surgical Center)
The OPR defined, the Owner can then determine the most appropriate Project Delivery Model and the Procurement Plan with which to ‘go-to market’ to on-board the project Design & Construction team and start the design process.
Stay curious. Stay tuned…
About the Author:
Kathleen Lausman, BES, MBA is a Principal at Shift2Lean and building industry professional with a background in architecture and business. Her experience is that of the Public Owner and buyer of design & construction expertise. She is a former Deputy Minister, Community & Government Services for the Nunavut Government and one of the forming members of the LEAN in Design & Construction community in Canada. She started her Lean journey sixteen years ago and is still learning.
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