An Investigation of Field Rework in Industrial Construction

1
An Investigation of Field Rework in Industrial
Construction
2
Capsule Summary of ResearchFunded by
theConstruction Industry Institute
(CII)Directed by the Causes Effects of
Field Rework Research Team (RT-153)Conducted
by Oregon State University (OSU)
3
Field ReworkResearch Team RT - 153

• Jim Atkinson
• US Steel (Chairman)
• Richard Calhoun
• Phillips Petroleum Co.
• Francis House
• Kellogg Brown Root
• William Wright
• Chemtex International
• Andrew Beal
• Air Products Chemicals

• Joe Beffa
• Black Veatch
• Phill Stassi
• Jacobs Engineering Group, Inc.
• Tom Falso
• Eichleay
• Dr. David Rogge (Researcher)
• Oregon State University

4
Presentation by Dr. David F. RoggeProgram
CoordinatorConstruction Engineering Management
(CEM)Oregon State University
5
Overview
6
RT-153 Objectives

• Identify methods being used to track rework.
• Identify the major causes of rework.
• Identify practices that most effectively
• minimize field rework.
• Develop a tool (Field Rework Index, FRI) that
  will foretell the degree of field rework.

7
Definition

• Field Rework is
• Total direct cost of rework in the field
  regardless of initiating cause or source.
• Field Rework is not
• Change orders for new work
• Off-site fabricator errors
• Off-site modular fabrication errors

8
Calculation

• Field Rework
• Total direct cost of rework performed in field
• Total field construction phase cost

9
How BIG is the Problem?

• CII Data
• Research Summary 10-2 (1989)
• 12 rework on 9 industrial projects
• Benchmarking Metrics Data Report (1997)
• 3.4 for 19 industrial projects
• This Research
• 4.4 for 109 industrial projects
• Ranges between 0 and 25
• High levels impact schedule

10
How is Field Rework Tracked? Objective 1

• CIIs Quality Performance Management System
  (QPMS) CII 10.3
• Measures field rework and design rework
• Measures cost of prevention and appraisal
• Adaptations of QPMS elements
• Company internal systems
• RT-153 Final Research Report will present a
  simplified system for field rework tracking only

11
Rework Causes and CuresObjectives 2 3

• Analysis of 145 projects shows strongest
  relationships between field rework and
• Owner organization alignment
• Engineering rework
• Constructability Commitment

12
Rework Causes and CuresObjectives 2 3

• Conclusion Improve the upstream processes
  (pre-project planning and engineering) and you
  will improve the downstream process
  (construction).

gtgt Not Rocket Science ltlt
13
Predicting Field ReworkObjective 4

• The Field Rework Index (FRI)
• Accurately predict field rework ?-- NO.
• Provide early warning? YES.
• BONUS Early warning for cost growth!

14
Predicting Field ReworkObjective 4

• How the FRI works
• Project team answers 14 questions
• Scores are summed
• X1 X2 X14 FRI
• Xn Team score for a question

15
FRI Form
16
FRI Rework Danger Chart
17
What are the Questions?

• Three categories of questions
• Team Planning Organization
• Information Availability
• Staffing or Schedule Constraints

18
Team Planning Organization

• Alignment within the Owners organization
• Degree of use of Project Execution Planning
• Design firms qualifications
• Change of design discipline leaders
• Commitment to using Constructability by design
  and construction contractors

19
Information Availability

• Field verification of conditions by Engineering
• Quality of interdisciplinary design coordination
• Availability of vendor information
• Level of design rework

20
Staffing or Schedule Constraints

• Compression of design schedule
• Design overtime
• Quality of Vendor prequalification
• Availability of skilled craftworkers
• Construction contractor overtime

21
The FRI is available through CII

• The Field Rework Index Early Warning for Field
  Rework and Cost Growth
• Research Summary 153-1
• February 2001
• (http//construction-institute.org)

22
Background
23
Why Does the FRI Work?

• Research Methodology
• Industry survey
• Attitudes and practices
• Identify best practices
• 85 responses from 46 organizations
• Focus group
• Database of actual project data
• Evaluate relationships
• Identify variables for early warning

24
The FRI Database

• Field rework measures from completed projects
• Percent
• Subjective rating
• Retroactive evaluations

25
Predictor Variables

• Selection process
• Industry survey analysis
• Research team brainstorming
• Focus group ? 63 variables
• Forced ranking ? 44 variables
• Analysis of initial 43-project database ?19
  variables
• Final FRI tool ? 14 survivor variables

26
Database

• 153 total projects
• 144 with subjective rework ratings
• 137 with complete info. for FRI
• 109 with measured rework
• 107 with cost growth information

27
Database

• Project size (US -- Construction Phase)
• Minimum 200 thousand
• Maximum 558 million
• Mean 58 million
• Median 17 million

28
Database
29
Factors Related to Field Rework

• FRI variables in descending order of relationship
  with field rework rating
• Owner alignment
• Design Rework
• Constructability commitment
• Interdisciplinary design coordination
• Degree of project execution planning

30
Factors Related to Field Rework

• FRI variables (continued)
• Design firms qualifications
• Field verification
• Expected craftworker availability
• Expected construction overtime
• Engineering overtime
• Design leadership changes
• Design schedule compression
• Supplier prequalification
• Supplier information

31
How Strong Were the Relationships?
32
Rework vs FRI
33
Rework Rating vs FRI
34
Database Analysis

• CONCLUSION Accurate prediction of percent field
  rework not possible.
• BUT, is early warning possible?

35
Yes.

• For the database
• FRI gt45
• 6.8 mean rework (16 projects)
• FRI lt 30
• 2.5 mean rework (34 projects)

36
Rework Rating for FRI lt30
37
Rework Rating for FRI gt45
38
But Wait, Theres More!
39
FRI Warns of Cost Growth!
FRI Score Cost Growth () Number of Projects
gt45 25.8 15
30-45 6.0 54
lt30 -7.8 SAVINGS! 31
40
Cost Growth versus FRI
41
FRI Warns for Field Rework and Cost Growth

• For Database
• Warning for field rework and for cost growth
  about equal
• FRI target of lt30 is good for both

42
RECAP FRI Development

• 63 possible predictor variables identified
• Analysis of 145 project database reduced
  variables to 14.
• Survivor variables form FRI
• Projects with FRIs lt30
• had low or very low rework
• cost growth was negative
• Projects with FRIs gt45
• two of three had high or very high rework
• cost growth was gt25

43
Other Findings

• Field rework metrics are not standardized
• Metrics used
• of actual construction phase cost
• of total installed cost
• of labor hours or dollars (by craft or not)
• Other variations
• Significant differences in magnitude
• Example 5 of labor may be 2 of construction
  and 0.5 of TIC

44
Other Findings

• From the survey of CII companies
• 87 track field rework
• 79 unfamiliar with QPMS
• Only 2 of 17 trying QPMS discontinued
• 72 used field rework data to improve engineering

45
Other Findings

• Survey of CII companies (continued)
• Ways to minimize field rework
• 98 - up-front planning and scope definition
• 88 - constructability
• 48 - establish goals
• 31 - use PDRI (CIIs Project Definition Rating
  Index, Pre-Project Planning Tools PDRI and
  Alignment, Research Summary 113-1)

46
Best Practices for Measuring and Managing Field
Rework

• Research Team studied best practices
• Companies identified by
• Questionnaire survey
• Research team
• Six site visits

47
Earning Rework Incentive

• Best Practice Example
• Contract allowed increased profit through reduced
  field rework
• Examine, flow chart, and improve engineering
  processes
• Use of 3D-CAD
• Use of site photogrammetry
• Incentives earned.

48
QPMS for 10 Years

• Best Practice Example
• CII Research Summary 10-3 introduced QPMS in 1989
• Measures field rework and design rework
• Measures cost of prevention and appraisal
• One company has used extensively
• Average rework of 10.1 in 88
• Average rework of 2.6 in 98
• Revised procedures
• Software to facilitate
• Lessons learned

49
Field Rework Incentives in Design Contracts

• Best Practice Example
• Owner uses field rework measures
• as factor in awarding design contracts
• as incentive for fees in design contracts

50
Construction Contractor

• Best Practice Example
• Construction contractor tracks field rework
• Norms by design firm
• Constructor-caused
• For continuous improvement
• No cost to owner even when cost-reimbursable

51
Conclusions

• Field rework is significant cost for industrial
  construction
• Average 4.4 of construction phase cost
• Median 3.0
• Range of 0 - 25
• FRI is simple tool providing early warning
• for field rework
• for cost growth

52
Conclusions (contd)

• Efforts to minimize field rework must start long
  before construction
• Improve Owner organization alignment
• Minimize engineering rework
• Constructability commitment
• Other 11 variables of FRI

53
Recommendations

• Use FRI on industrial projects to warn of
  potentially high field rework and cost growth
• Include FRI variable scores in project summaries
  to build company-specific database.

54
Thank you.

• Contact Dr. David Rogge with information or
  questions
• Dept. of Civil Engineering
• Oregon State University
• Apperson Hall, Rm. 111
• Corvallis, OR 97331-2302
• Phone [phone], FAX [phone]
• E-mail David.Rogge_at_orst.edu
• www.engr.orst.edu/rogged