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The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Quality Assurance in Residential Foundations and Construction Surveying Layout Techniques in the Southeastern United States John W. Adcox, Jr., EdD, CPC

ABSTRACT This article provides an overview of three areas: Quality Assurance, Placement Considerations and Actual Techniques used in Residential Building Layout. Key Words Construction Surveying, Construction Layout, Residential Construction, Foundation Layout, and Quality Assurance INTRODUCTION Quality assurance in the layout and soil conditions of residential foundations, as a general practice, is given very little consideration. Five major factors contribute to this: 1) Leniency of building codes, 2) The cost of subsurface investigations and construction testing, 3) The short construction timeline of most residential projects, 4) Lack of written formal specifications, and 5) Accuracy used during layout techniques. There is not usually an attempt by a residential contractor to "short cut" the necessary quality assurance steps; however, the constraints of costs and time often preclude the use of quality assurance measures. QUALITY ASSURANCE The importance of the foundation is obvious to the contactor but in most instances never seen or understood by the client or owner. Settlement and cracking problems, which sometimes occur in structures, can often be traced back to inadequate foundation preparation or lack of knowledge of subsurface conditions at the project site. The prevalent indicator of subsurface conditions used by contractors is the history of surrounding structures. If these structures are performing well, it is assumed the next structure will perform equally well. This is sometimes a good indicator but it should not be relied on exclusively. A necessary construction practice that is often neglected is the recompaction of disturbed natural soil during footing excavations. Quite often the upper four to six inches of bearing soil, upon which the foundation will rest, are


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

disturbed during the footing excavation process. Sometimes this is lightly tamped, simply to provide an even bearing surface, but most often not recompacted at all. Most soils encountered in the southeastern United States (lower coastal plains area), can be compacted relatively easily. Due to the nature of these soils, a high compaction percentage rating, when compared to the laboratory standards, can be achieved over a broad range of moisture contents. The grain size distribution of this coastal soil is usually classified as “ SP “ in the United Soil Classification, which is poorly, graded sand. Residential foundations are either dug by hand, specialized footing machines or with a backhoe. Typical types in the south are continuous spread footings (continuous "T") or monolithic. The continuous footings in virtually 99% of the projects are 8" high by 16" wide, 8" high by 20" wide (for brick veneer exterior systems), or 12" high by 24" wide for two story construction and / or poor soil conditions. Most monolithic footings have a 12" to 16" bearing surface and are 12" high. This standard foundation size adds to the potential for neglecting subsurface investigations. The actual layout techniques used by foundation contractors are typically quick, simple and within accuracy limits needed for a building to be square. One problem, which results from some layout techniques, is that corners within the building are not square with each other, often causing large gaps behind kitchen cabinets, countertops or other corner installed applications. RESIDENTIAL LAYOUT TECHNIQUES Residential layout techniques have evolved over the years. Some of the most commonly used techniques include: 1. 2. 3. 4.

The 6-8-10 (right triangle method) used since the pyramids Surveying (instrument-transit, theodolite or builders level) method 30-40-50- rope method (right triangle hybrid) Right angle math method (the most commonly used today due to time savings) 5. Total station and robotic layout (Radial Layout) (Typically used in commercial construction and not residential) See article on radial layout in Concrete construction - 2005. 6. GPS (the very near future)

The layout method selected by the foundation contractor normally requires a diagonal accuracy check of ¼” to ½”. Unfortunately, when foundation contractors allow the diagonal squareness check to exceed this envelope, the house corners will not be true. The lack of 90 degree corners will continue to magnify as the house emerges from the foundation. (See diagram 11).


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

METHODS The 6-8-10 foot method has roots as far back as the pyramids. This method incorporates the use of the right triangle to locate the building footprint on the property. Using three pieces of 1�x 4� lumber cut to lengths of 6-feet, 8-feet and 10-feet nail them together to form a right triangle. When placed on the ground with the 6-foot and 8-foot sides positioned over the outside corner of foundation, the 10-foot section completes the triangle and depicts a squared corner. Nylon string line is then pulled along the 6-foot and 8-foot boards and extended until the home length is measured out. This process requires at least two individuals. The surveying method simply places the instrument over the corner of a building and a sighting is taken down one side of the building then turned 90 degrees to locate the adjacent side. Once each side is measured and staked, the instrument is moved to one of the corners just marked and new exterior wall lines are located and staked. This process also requires at least two individuals. The 30-40-50 foot rope method is a simple variation of the 6-8-10 methods. The pieces of rope or chain are cut to 30 feet, 40 feet and 50 feet lengths with a loop left in each end. Then pieces or rebar (12 to 24 inches long) are used to make a triangle. The process starts with a piece of rebar driven into the ground at the building corner, next the 30 or 40 foot piece of rope is extended along a building exterior foundation wall line and another piece of rebar driven next, place the other pieces of rope or chain over the two ends and pull the lines taut while holding the loose ends together. This will establish the third point of a 30-foot by 40 foot by 50-foot right triangle. Simply extend the rope lines to the needed building dimension. One individual can do this process The right angle math method is the one most used by residential foundation contractors. The building foundations sheet is reviewed to determine the length of two adjacent sides. Those dimensions are squared, added together and the square root calculated to determine the diagonal. This is nothing more than an application of the Pythagorean Theorem. With the common use and low cost of hand held calculators, this step is quick and provides an extremely high degree of accuracy. Once the calculations are made, using a 100-foot tape measure and pieces of rebar or nails, start with one corner of the building and lay out a large box on the ground correctly identifying the actual corners of the building. One individual can do this process. Total station and robotic layout (Radial Layout)


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

ACTUAL RESIDENTIAL CONSTRUCTION LAYOUT TECHNIQUES The actual steps or techniques used by residential contractors (or foundation contractors) to layout a residential project use the following procedures: 1) Review site or plot plan to determine footprint of building on property. 2) Locate lot boundaries (property lines) with flagged stakes. This may require a licensed surveyor to come verify the corners. 3) Using a 100-foot tape measure, determine building set backs from property boundaries. (Diagram 1) 4) From corner identified (by drawing marks on ground) establish a large box using the 6–8–10 layout method, right angle math method, or surveying Instrument. (Diagram 3) 5) Mark all exterior wall locations (mark on ground). (Diagram 3) 6) Determine batter board locations (set back at least 3 feet for hand digging or 10 feet from building when a backhoe or other equipment). (Diagram 4) 7) Drive wood stakes (1”x 4”s or 2”x 4”s) for batter boards. (Diagram 5) 8) Using a laser level or surveying instrument, set finish floor elevations (marks) on driven wood stakes, or on nearby permanent structure. (Diagram 6) 9) Nail batter boards on stakes at finish floor elevations, which were marked on wood stakes or permanent structure. (Diagram 7) 10) Using nylon string, carefully tie onto nails driven in the batter boards. Lines must be placed over marks on ground. (Use plumb-bob or 4’ level) 11) Decide which line will be the base line from which all other lines will be pulled. (Diagram 8) 12) Using parallel measurements set lines at every footing location. (all directions) (Diagram 9)


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

13) Adjust nylon line length to correct distance per foundation plan (do not move base line) (Diagram 10) 14) Once all lines are to the correct building dimensions, measure diagonals to be sure the building box is square. (Diagram 11) 15) Double check measurements. 16) Mark ground for location of exterior foundation walls using spray paint, line or similar material. 17) Remove string lines and place forms for monolithic slabs or dig the trench for continuous foundation. 18) Remove string lines temporarily, place rebar, grade stakes, and place concrete in foundation. 19) Replace string lines and mark continuous footing for placement of CMU wall leads. 20) Backfill, compact, install rough plumbing, HVAC, electrical, termite treatment, vapor barrier, place grade stakes and place finish slab.

Diagram 1


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Diagram 2

Diagram 3


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Diagram 4

Diagram 5


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Diagram 6

Diagram 7


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Diagram 8

Diagram 9


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Diagram 10

Diagram 11


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Double check measurements and final placement of strings. Mark ground for footing placement or forms. SUMMARY In summary, quality assurance in residential construction foundations has five factors that should be considered. 1) Leniency of building codes, 2) The cost of subsurface investigations and construction testing, 3) The short construction timeline of most residential projects, 4) Lack of written formal specifications, and 5) Proper application of layout techniques. One of the key elements is accuracy using layout techniques and how it is actually performed on today’s residential construction sites in the southeastern United States. REFERENCES Alsalman, Abdullah. S.A.(Mar. 1999).”Evaluating the accuracy of differential, trigonometric and GPS leveling” Surveying and Land Information Systems. V. 59 no 1, p. 47-51 . Austin, Barry. (1988). Construction Measurements. New York: Wiley. Brinker, Russell.(1987). The Surveying Handbook. New York: Van Nostrand Reinhold. Crawford, Wesley G. (1995). Construction Surveying and Layout. West Lafayette, IN:Creative Construction Pub. Chang, Chia-Chyang.(2000). “Research Papers-Estimation of Local Subsidence Using GPS and Leveling Data.” Surveying and land information systems: journal of American Congress on Surveying and Mapping. V. 60, no.2, p.85 - 95. DeGaspari, John. (Feb. 2002). “Laser Surveying.” Mechanical Engineering; New York. V. 124, p.11. Gibson, David W.(Mar. 1999).” Conversion is out, measurement is in –are we beginning the surveying and mapping era of GIS?” Surveying and Land information Systems, V59, no. 1, p.69-72.. Ghaly, Ashraf M.(Sept. 2000). “Field and computer applications of surveying principles in site development.” Surveying and Land information Systems. V. 60. no. 3 p. 191-196.. Kavanagh, Barry F.(2001). Surveying: with Construction Applications. 4th ed. Upper Saddle River, NJ. Prentice Hall. Kavanagh, Barry F.(2003). Geomatics. Upper Saddle River, NJ. Prentice Hall.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Kaplan, Elliott D.(1996). Understanding GPS: principles and applications. Boston: Artech House. Larijani, L. Casey. (1998). GPS for everyone: how the globel positioning system can work for you. New York: American Interface Corp. Leick, Alfred.(1995). GPS satellite surveying. 2nd ed. New York:Wiley. McCormac, Jack.(1991) Surveying Fundamentals. Englewood Cliffs, NJ: Prentice Hall. Roberts, Jack. (1995). Construction Surveying, layout and dimension control. New York: Delmar Pub. Stull, Paul. (1987). Construction Surveying and layout. Carlsbad, CA:Craftsman Book Co.

Dr. John W. Adcox, Jr., CPC is currently the Program Manager for the Department of Construction Management, Drafting Design, and Building Trades at Florida Community College in Jacksonville, Florida. Dr. Adcox received his doctorate degree from the University of Florida in 1983. Dr. Adcox’s professional career began as a third generation contractor in Picayune, Mississippi; thereafter he attended Mississippi State University earning a Baccalaureate of Science and Master of Education degree in 1973 and 1974. His academic focus was on developing, teaching and administrating construction management education. Dr. Adcox owns consulting business where he teaches seminars, writes e courses, correspondences courses and expert witness work.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

The Economics of Solar Photovoltaics in Residential Construction In North Carolina Carol M. Woodson, PhD, AIC and Mark W. Huggins ABSTRACT Many people today still have misconceptions or misunderstandings concerning the economics behind the utilization of alternative energy in a residential setting. Alternative energy systems have become more competitive economically today, especially in respect to the current escalating energy costs. This paper will explore and clarify some of those misconceptions, specifically solar power hybrid systems in North Carolina. While the focus is on North Carolina, many of the concepts are applicable to other States. With proper home design, passive solar orientation, a well designed integrated solar photovoltaic system, and by taking advantage of the many state and federal tax incentives, initial costs can be compensated in paybacks and life time energy savings. A 2030% increase in initial costs can be offset by tax incentives reducing the increase down to 10%; with annual energy savings the 10% can be offset making solar homes cost the same as conventional. Today, solar photovoltaics are far more obtainable and economical for residential homes. Key Words Solar Photovoltaics, Residential Construction, North Carolina, Energy Savings INTRODUCTION Many people today still have misconceptions or misunderstandings concerning the economics behind the utilization of alternative energy in a residential setting. Alternative energy systems have become more competitive economically today, especially in respect to the current escalating energy costs. This paper will explore and clarify some of those misconceptions, specifically solar power hybrid systems in North Carolina. While the focus is on North Carolina, many of the concepts are applicable to other States. By taking advantage of the various incentives from the State and Federal governments both owner and contractor can benefit financially by installing solar photovoltaic systems in the residential genre. With a proper home design, passive solar orientation, and a well designed integrated solar photovoltaic system any increase in initial costs can be compensated in paybacks within a matter of a few years and with a life time of energy savings.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Prior to 1950 the U.S. had been energy self sufficient, but has consistently since then become ever more reliant on imported oil from the Middle East with 60% of the oil from imports. Energy costs are constantly fluctuating upward with no end in site. Alternative energy sources are increasingly becoming more competitive economically in today’s volatile oil market. From an economic perspective, the environment should be considered as a scarce resource where its goods and services are no longer in ample supply; its decrease in supply will have a direct effect on economics and allocation (Siebert, 1995, USDOE, 2006). In many respects that is the current situation in the oil supply. Solar energy is responsible for life on earth. While the sun emits 2 billion units of energy into space, the earth receives approximately only 1 unit out of 2 billion; and there is evidence that this rate of energy has been fairly constant for the last 5 billion years (Greeley, Ouellette, & Cheremisinoff, 1981). The United States receives more energy from the sun in 40 minutes than it does from the fossil fuel it burns in one year (De Laquil, Kearney, et.al., 1993). Solar energy is abundant, constant, nonpolluting, inexhaustible, renewable and free. PASSIVE SOLAR The two types of solar energy gain are passive and active. The energy efficiency performance is optimal whenever they can be used together. Passive solar design is comprised of a few simple building practices. It is simply the practice of controlling the solar energy by means of utilizing the sun’s changing orientation to the home during the seasonal changes occurring in one calendar year. By maximizing the attributes of the sun and integrating them into the design of the home in a synergetic approach; the use of any mechanical systems can be minimized. Passive solar has been used to some extent by all civilizations, but it was the Romans who developed passive solar designs in their buildings. These designs were commonly used and recorded in Roman writings (Lechner, 1991). The distinct advantage of passive solar is its little or minimal increase in the initial costs of the home. Passive solar design is site specific using the basic passive solar design principles. The home is constructed facing south, with around 6070% of the homes windows on the south side. The exterior walls are at least 2x6 framing material and well insulated. The home should have several deciduous trees established within close proximity to provide shade in the summer and allow the warmth of the sun to penetrate in the winter months when the leaves have fallen. The windows orientation allows the radiation from the sun in and helps to heat the structure and the well insulated walls and ceiling trap in the free heat. SOLAR PHOTOVOLTAICS


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

An active solar system is slightly more involved. It is the conversion of solar energy into useable electricity. There are two basic types of photovoltaic systems, the stand alone and the utility interactive. While both systems use photovoltaic cells for collection, the stand alone uses a battery storage system to store the electricity generated with a diesel fuel generator as a back-up. The batteries used for storage typically last 20 years or more and require very little maintenance (Lechner, 1991). The integrated system is connected to a traditional electrical utility grid system as a means of back-up. Any additional electricity not needed is not stored but fed into the grid system, or more accurately sold to the utility company. The light absorbed into a PV cell generates electricity. This is accomplished by the energy of the absorbed light being transferred to electrons in the PV cell. These electrons escape from their normal positions in the atoms of the semiconductor PV material and become part of the electrical flow in an electrical circuit. A special electrical property of the PV cell called a “built in electric field” provides the voltage needed to drive the current by positioning two layers of different semiconductor materials in contact with each other. One layer with a negative charge and one with a positive; this “p/n” interface creates an electrical field. The primary material is silicon (USDOE, 2006). The cells when oriented to true south will collect more sun and increase efficiency. While there are several different types of solar cells ranging from the traditional panel to the translucent panel that can be used as window glazing or skylights; the relatively new and seemingly preferred solar roofing system is the solar shingle system that looks and is applied as a standard three tab asphalt shingle. Applied to the back of the shingle is the PV wiring system that is connected by the installer and linked directly to the homes power transformer. The shingles are attractive; resemble standard shingle roofing, providing an unobtrusive solar panel. Not only can they produce electricity, but they function as a common building material. The PV cells are connected to a power tracker, which tracks incoming power, the stored and available power, and records the power usage of the occupants. Supplemental systems are also integrated before the transformer converts the DC current to AC for use by the occupants. The integrated system is recommended for North Carolina. The sunshine is more than ample to utilize a solar system; however, it is not uncommon to have consecutive overcast or rainy days. Therefore, for convenience the homeowner will need to integrate the PV system with the local utility grid for days of inclement weather (Uni-Solar, 2006). ECONOMICS AND TAX CREDITS It is difficult to assess the proper hybrid system for a home without proper attention to funding the investment. While the reluctance to use solar photovoltaics is quite understandably due to its perceived high initial cost, recent developments have decreased this cost. For example, cells in 1970 cost over


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

$1,000 per peak watt of power. In 1997 they had dropped to just under $5 per peak watt of power and in 2001 were selling at below $3 per peak watt. Today, due to new process technology in producing the cells by a California company, Nanosolar, they are selling for below $1 per peak watt (Building-integrated Photovoltaics, 2000; Sustainable Systems, 1997; Nanosolar, 2006). In relation to the rising fuel costs, solar photovoltaics may be far more economical today then at any previous time. With the anticipation of continued rising energy costs solar photovoltaics may be the energy source of the future for residential homes. In addition with the available funds in tax credits from both state and federal sources the installation of an integrated solar photovoltaic system has become even more enticing economically. Today, forty-eight states provide incentives for solar energy systems (USDOE, 2006). North Carolina provides some of the best tax credits in the nation. There are also additional tax credits available at the federal government level that can be used in addition to the state credits. Tax form NC-478G 2005, is considered a personal tax credit originally enacted in 1977 and when reviewed in 2005 was extended for yet another 5 years. The revised statute provides for a tax credit of 35% of the cost of renewable energy property constructed, purchased, or leased by a taxpayer and placed into service in North Carolina during the taxable year. There are various ceilings depending on sector and type of renewable-energy system. The following credit limits for various technologies and sectors apply. •

A maximum of $3,500 for residential active space heating, combined active space and domestic water heating systems, and passive space heating;

A maximum of $1,400 for residential solar water-heating systems, including solar pool-heating systems;

A maximum of $10,500 for photovoltaic (solar electric), wind, or other renewable-energy systems for residential use; (The Database for State Incentives for Renewable Energy (DSIRE), 2006).

Renewable –energy equipment expenditures eligible for the tax credit include the cost of the equipment and associated design; construction cost; and installation costs less any discounts, rebates, advertising, installation-assistance credits, name-referral allowances or other similar reductions. Under North Carolina’s tax code, the allowable credit may not exceed 50% of a taxpayer’s liability for the year, reduced by the sum of all other credits. Single-family homeowners who purchase and install a qualifying renewable-energy system must take the maximum credit amount allowable for the tax year in which the system is installed. If the credit is not used entirely during the first year, the remaining amount may be carried over for the next five years. For all others, the


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

credit is taken in five equal installments beginning with the year in which the property is placed in service. If the credit is not used entirely during these five years, the remaining amount may be carried over for the next five years. The credit can be taken against franchise tax, income tax or, if the taxpayer is an insurance company, against the gross premiums tax.

From the Federal Government, the North Carolina home owner can expect an additional 30% from the Residential Solar and Fuel Cell Tax Credit. The ceiling is $2,000 dollars for the purchase and installation of a residential P.V. system, a 30% up to $2,000 credit for a solar hot water system, and a 30% credit up to $500 dollars per 0.5 kW is also available for fuel cells. Excess credit may be carried forward to succeeding tax year. Combining the State and Federal Tax incentives the homeowner has up to 65% of the system paid for up to the applicable ceilings for dollar amounts (DSIRE, 2006).

The other applicable State and Federal incentives are summarized as follows:

NORTH CAROLINA STATE INCENTIVES: 1.) Active Solar Heating and Cooling Systems Exemption Last DSIRE Review: 08/21/2005 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Max. Limit: Authority 1: Date Enacted:

Property Tax Exemption Solar Water Heat, Solar Space Heat

Commercial, Industrial, Residential No more than conventional equipment None N.C. Gen. Stat. § 105-277 1977


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

2.) NC Green Power Production Incentive Last DSIRE Review: 05/17/2005 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Terms: Website: Authority 1: Date Enacted:

Production Incentive Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Hydroelectric, Anaerobic Digestion Commercial, Industrial, Residential, Nonprofit, Schools, Local Government, State Government, Agricultural, Institutional Varies by technology and customer demand for NC Green Power Payments contingent on program success http://www.ncgreenpower.org NCUC Order, Docket No. E-100, Sub 90 1/28/03

3.) Renewable Energy Tax Credit - Personal Last DSIRE Review: 01/27/2006 Incentive Type: Eligible Renewable/Other Technologies:

Personal Tax Credit Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Wind, Biomass, Hydroelectric, Renewable Transportation Fuels, Spent pulping liquor, Solar Pool Heating, Day lighting, Ethanol, Methanol, Biodiesel Applicable Sectors: Commercial, Residential, Multi-Family Residential Amount: 35% Maximum Incentive: $1,400 - $10,500 (varies by technology); $2.5M for commercial applications Carryover Provisions: Single-family dwellings: excess credit may be carried forward five years; all other property: credit taken in five equal installments; allowable credit not to exceed 50% of taxpayer's liability for the year, reduced by the sum of all other credits. Eligible System Size: Maximum of 50 kWh battery storage capacity per kW of hydro generator capacity (DC rated); maximum of 35 kWh battery storage capacity per kW for other technologies Equipment/Installation System must be new and in compliance with all applicable Requirements: performance and safety standards. Specific equipment and


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Website: Authority 1: Date Enacted: Effective Date: Expiration Date: Authority 2: Date Enacted: Effective Date: Expiration Date:

installation requirements vary by technology. http://www.ncsc.ncsu.edu/ information_resources/renewable_energy_tax_guidelines.cfm N.C. Gen. Stat. § 105-129.15; § 105-129.16A - 19 1977; revised 1994, 1999 1/1/00 1/1/06 SB 1149 of 2005 9/2005 1/1/06 12/31/10 • • • • • •

Guidelines for NC Renewable Energy Tax Credit NC-478G 2005 NC-478G 2005 Instructions NC-478 2005 NC-478 2005 Instructions NC-478 Series 2005 General Instructions

4.) TVA - Green Power Switch Generation Partners Program Last DSIRE Review: 08/19/2005 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Terms: Website:

Production Incentive Photovoltaics, Wind

Commercial, Residential $500 (residential only) plus $0.15/kWh (residential/smallcommercial) or $0.20/kWh (large commercial) for 10 years $500 payment available only until the program capacity reaches 150 kW http://www.gpsgenpartners.com


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

5.) North Carolina - Net Metering Last DSIRE Review: 10/26/2005 Incentive Type: Net Metering Rules Eligible Photovoltaics, Landfill Gas, Wind, Biomass, Anaerobic Digestion Renewable/Other Technologies: Applicable Commercial, Industrial, Residential Sectors: Limit on System 20 kW for residential systems; 100 kW for non-residential Size: systems Limit on Overall 0.2% of each utility's North Carolina retail peak load for the Enrollment: previous year Treatment of Net Credited to a customer's next monthly bill, but reset to zero Excess: at the beginning of each summer (June 1) and winter (October 1) billing season. Any renewable-energy credits associated with net excess is granted to the utility when the balance is zeroed out. Utilities Involved: Investor-owned utilities (Progress Energy, Duke Power, Dominion North Carolina Power) Interconnection Standards for Net Metering? Yes Authority 1: NCUC Order, Docket No. E-100, Sub 83 Date Enacted: 10/20/2005 Effective Date: 1/1/2006

Federal Incentives: 1. Tribal Energy Program Grant Last DSIRE Review: 03/10/2005 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount:

Federal Grant Program Passive Solar Space Heat, Solar Water Heat, Solar Space Heat, Photovoltaics, Wind, Biomass, Hydroelectric, Geothermal Electric, Geothermal Heat Pumps Tribal Government Varies


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Max. Limit: Terms: Website:

Varies Varies http://www.eere.energy.gov/ tribalenergy/financial.html

2.) Energy Efficient Mortgage (EEM) Last DSIRE Review: 08/24/2004 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Max. Limit:

Federal Loan Program Solar Water Heat, Solar Space Heat, Photovoltaics

Terms: Website:

Vary http://www.natresnet.org/ resources/lender/default.htm

Residential Varies Varies-- All buyers who qualify for a home loan qualify for the EEM. The EEM is intended to give the buyer additional benefits on top of their usual mortgage deal. The lender will use the energy-efficiency of the house, as determined by a HERS rating, to determine what these benefits will be.

3.) Energy Star Financing and Mortgages Last DSIRE Review: 01/14/2005 Incentive Type: Federal Loan Program Eligible Geothermal Heat Pumps, Renewable techs if other requirements are Renewable/Other met Technologies: Applicable Commercial, Residential, Schools, Local Government, Construction, Sectors: Utility, State Government, Installer/Contractor Website: http://www.energystar.gov/ index.cfm?c=bldrs_lenders_raters.pt_HowLndrWhatAreESMortgages


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

4.) Veterans Housing Guaranteed and Insured Loans Last DSIRE Review: 01/27/2006 Incentive Type: Federal Loan Program Eligible Efficiency Equipment Insulation, Heat pumps, Caulking/Weather-stripping, Technologies: Building Insulation, Windows, Doors, Roofs Eligible Passive Solar Space Heat, Solar Water Heat, Solar Space Heat Renewable/Other Technologies: Applicable Residential, Veterans, Retired Service Personnel, Sectors: Unmarried Surviving Spouses of Veterans Amount: Varies Max. Limit: $3,000-$6,000 (see summary) Terms: Department of Veterans Affairs guarantees 50% for loans up to $45,000. Website: http://www.federalgrantswire.com/ veterans_housingguaranteed_and_insured_loans.html Authority 1: 37 USC § 3710 Date Enacted: 10/28/1992 Effective Date: 10/28/1992 5.) Residential Energy Efficiency Tax Credit Last DSIRE Review: 03/02/2006 Incentive Type: Personal Tax Credit Eligible Efficiency Water Heaters, Furnaces, Boilers, Heat pumps, Air conditioners, Technologies: Building Insulation, Windows, Doors, Roofs, Circulating fan used in a qualifying furnace Eligible Geothermal Heat Pumps Renewable/Other Technologies: Applicable Sectors: Residential Amount: 10% of cost of building envelope improvements; 100% for qualified energy property (heating, cooling, water heaters) Maximum Incentive: Varies by technology; no more than $500 credit for all energy property and envelope improvements for all tax years. Equipment/Installation Equipment must be new and in compliance with all


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Requirements: Website: Authority 1: Date Enacted: Effective Date: Expiration Date:

applicable performance and safety standards; performance and quality standards vary by technology http://www.irs.gov/ newsroom/article/0,,id=154657,00.html 26 USC § 25C 8/8/2005 1/1/2006 12/31/2007

6.) Residential Solar and Fuel Cell Tax Credit Last DSIRE Review: 02/17/2006 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Maximum Incentive:

Personal Tax Credit Solar Water Heat, Photovoltaics, Fuel Cells

Residential 30% $2,000 for photovoltaics and solar water heating; $500 per 0.5 kW for fuel cells Carryover Provisions: Excess credit may be carried forward to succeeding tax year. Eligible System Size: Not specified Equipment/Installation Solar water heating property must be certified by Requirements: SRCC or by comparable entity endorsed by the state. At least half the energy used to heat the dwelling's water must be from solar in order for the solar water heating property expenditures to be eligible. Authority 1: 26 USC § 25D (2005) Date Enacted: 1/1/2006 Effective Date: 8/8/2005 Expiration Date: 12/31/2007


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

7.) Renewable Energy Production Incentive (REPI) Last DSIRE Review: 10/25/2005 Incentive Type: Eligible Renewable/Other Technologies: Applicable Sectors: Amount: Terms: Website: Authority 1: Date Enacted:

Production Incentive Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Livestock Methane, Tidal Energy, Wave Energy, Ocean Thermal, Fuel Cells (Renewable Fuels) Tribal Government, Municipal Utility, Rural Electric Cooperative, State/local gov't that sell project's electricity 1.5 cents per kWh (indexed for inflation) 10 years http://www.eere.energy.gov/wip/program/repi.html 42 USCS § 13317 1992, amended 2005

CONCLUSION The two organizations compiling figures and establishing standardized alternative building practices are the U.S. Department of Energy (USDOE) working with the U.S. Green Building Council (USGBC). They have been monitoring various volunteer homes to compile the most accurate data to date concerning the energy savings for residences utilizing the latest alternative energy systems. According to the USDOE the average annual energy bill for a U.S. family today is $1,570. By contrast a solar home that operates under solar power yet consumes and contributes to the main power grid on average has an annual energy bill of $300 annually or $25 dollars a month. It is possible a payback on the system can be achieved in 2 years (USDOE, 2006). The energy saving technology, depending upon the sophistication of the system, will increase the final dollar amount of the home 20-30%, however, when the homeowner takes advantage of the available State and Federal incentives and financing, the total increase to the monthly mortgage payment is only 10%. With the annual energy savings the rest of the increased costs can be offset making solar homes cost the same as conventional; making solar photovoltaics far more obtainable and economical for residential homes.


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REFERENCES Building-integrated photovoltaics: Putting power production where it belongs. (2001, March). Environmental Building News, 10(3), 1, 8-14 Database for State Incentives for Renewable Energy. (2006). State and Federal tax incentives. Retrieved February 8, 2006, from http://www.dsireusa.org. DeLaquil, P., Kearney, D., Geyer, G., & Diver, R. (1993). Solar-thermal electric technology. In T. Johansson, H. Kelly, A. Reddy, &R. Williams (Eds.), Renewable Energy (pp. 213-296). Washington, DC: Island Press. Greeley, R., Ouellette, R., & Cheremisinoff, P. (1981). Solar heating and cooling of buildings. Ann Arbor, MI: Ann Arbor Science Publishers. Lechner, N. M. (1991). Heating, cooling, lighting: Design methods for architects. New York: John Wiley & Sons. Nanosolar. (2006). Products and technology. Retrieved June 2, 2006, from http://www.nanosolar.com Siebert, H. (1995). Economics of the environment: Theory and policy (4th ed.). Berlin: Springer-Verlag. Sustainable Systems. (1997). Greening federal facilities. (DOE Publication No. DOE/EE-0123). Washington, DC: U.S. Department of Energy. Uni-solar. (2006). Building integrated systems; Home energy solutions. Retrieved June 1, 2006, from http://www.uni-solar.com/interior.asp?id=69 United States Department of Energy (USDOE). (2006). Solar energy technologies. Retrieved May 14, 2006, from http://www.eere.energy.gov/solar /photovolaics.html

Carol M. Woodson, Ph D is an Assistant Professor in the Construction Management Department in the Kimmel School of Construction Management, Engineering and Technology at Western Carolina University. She holds a PhD from the University of Florida. Dr. Woodson has over 25 years experience in the construction industry and construction education. Her extensive experience as an owner’s representative includes management positions in both the public and private sectors, with a specialty in school construction. She holds a Bachelor of Fine Arts from Wesleyan College, a Bachelor of Building Construction, and a Masters in Building Construction from the University of Florida. She is faculty advisor for Sigma Lambda Chi at Western Carolina University. Dr. Woodson’s


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

research interests are in Sustainable Construction and Educational Facilities. She is a member of the Associated General Contractors of America (AGC), The American Institute of Constructors (AIC), and Sigma Lambda Chi, the Construction International Honor Society (SLX). Mark W. Huggins is a junior at Western Carolina University. He is a dual major and will be receiving a Bachelors degree of Business Administration in Construction Management from the Kimmel School of Construction Management, Engineering and Technology as well as a Bachelors of Arts degree in Philosophy. He has over 5 years experience working for a custom residential Design/Build firm in Cashiers, North Carolina and is a member of the Western North Carolina Green Building Council (WNCGBC).


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

The Role of the Contractor in Sustainable Construction Wayne Jensen, PhD, PE and Anthony Kouba ABSTRACT Sustainable construction is an expanding segment of the U.S. construction industry. Sustainable construction considers a building’s life cycle cost and the building’s impact on the environment versus only its cost of construction. In the US, sustainable construction is based upon LEED standards. Contractors play a significant role in many aspects of LEED certification for any structure. LEED standards place heavy emphasis on sustainable construction practices incorporated as early as possible into the design process, where LEED certification is primarily the responsibility of the designers. While early incorporation is ideal, it may not always be feasible. When LEED certification is introduced later in the design phase, the contactor becomes more heavily involved in the certification process. This paper discusses various aspects of designing and constructing a sustainable building and outlines some of the differences between the role of the design professionals and contractors during the construction process. Key Words Sustainable Construction, LEED, Sustainable Building INTRODUCTION Currently more than six billion people inhabit Planet Earth and by the year 2050 that number is expected to be more than nine billion. Our world is changing due to the increasing number of human beings and their effects on the environment. Acreage devoted to forests continues to shrink and hundreds of wildlife species disappear every year. Worldwide oil dependence is at an all time high and continues to spiral out of control. Water and air pollution remain at the forefront of environmental issues. Construction has existed as an industry that has been mostly exempt from environmental concerns. However, construction is now being challenged to be more responsible and in some instances regulated with regard to its impact on resources and the environment. Construction comprises about 8% of the U.S. gross domestic product but consumes almost 40% of the extracted resources used in the United States annually (LEED for New Construction 2005). Since construction is very resource intensive, the industry is becoming motivated to seek ways to use resources more efficiently. In addition to those resources required for new construction, concern also exists over the volume of construction waste. Kibert (2005) illustrates the impact of construction waste with the following: “…construction and demolition waste totaled more than 135 million tons in the United States in 1998; about 77 million tons resulted from commercial work


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

alone. Per-square-foot waste generation ranges from about 4 lbs per square foot for new construction and renovation to about 155 lbs for building demolition”. The building industry is beginning to experience pressure to assume more responsibility for the future. The principles of sustainable construction or “green building” can be applied to make buildings more energy and resource efficient while minimizing the quantity of waste generated during construction. Contractors can respond by resisting or embracing these efforts; however some changes have already been mandated by law. Specific aspects of sustainable construction are now being requested more frequently in response to resources and energy becoming more expensive. Background Before briefly exploring some practices related to energy, resource efficiency and waste reduction in the construction industry, some terms relating to these concepts should be clarified. In the past, the terms “high performance building”, “green building” and “sustainable construction” have all been used to describe essentially the same process. Sustainable construction appears to have evolved into the most comprehensive term. The Counseil International du Batiment, an international construction research organization, defines sustainable construction as “creating and operating a healthy built environment based on resource efficiency and ecological design” (Kibert 2005). Sustainable construction has been evolving for at least two decades in various locations around the world. In the United States, a landmark date was the founding of the U.S. Green Building Council (USGBC) in 1993. Creation of the USGBC signaled that the construction industry as well as the U.S. government acknowledged the need for more responsible construction practices. From 1994-1998, the USGBC developed the first standard to evaluate the impact of a building on the natural environment. This standard became known as Leadership in Energy and Environmental Design (LEED) program, which is based upon a checklist containing five categories of environmental concerns. LEED certification should ideally be incorporated into the construction process at the earliest opportunity. Early registration makes the building certification process considerably less arduous by offering options which are later closed. As design progresses, drawings and plans are inspected and evaluated by engineers, architects and contractors and accumulate credits during design and construction. Points are awarded for minimizing the environmental impact of the structure on the environment. Sixty-nine is the maximum number of points available for any building. Four levels of achievement are possible, including: Certified (28-32 points), Silver (33-38 points), Gold 39-51 (points) and Platinum (52-69 points).


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Certification at different levels can offer benefits in the form of tax breaks or owner/tenant incentives and demonstrates the level of environmental commitment achieved through conscientious design and construction. The five categories of environmental credits evaluated by the LEED system and specific practices being used or developed with regard to each are discussed briefly in the paragraphs that follow. Building Site and Landscaping The first consideration for a green structure is the building’s site and landscaping. A sustainable building should be constructed on a site that promotes responsible use of the environment. Choosing a site such as a grayfield or brownfield is a significant step toward complying with LEED standards and can have a positive impact on the local community. A somewhat environmentally friendly building constructed on a former industrial site is considered more beneficial than a completely environmentally acceptable building constructed on prime farmland. Since the contractor seldom has influence over site selection, this point will not be discussed further. The contractor plays a much more significant role in other aspects of sustainable sites, including site disturbance and erosion control. Each year over 600 million tons of soil is eroded from construction sites in the U.S. (Kibert 2005). When selecting a building site and during construction, it is important that the construction manager and the subcontractors develop methods to control erosion. The 2003 Environmental Protection Agency (EPA) Construction Control Permit, local erosion and sedimentation standards, and many building codes hold the contractor responsible for runoff and erosion of soil from his/her site(s). Significant penalties have been imposed for violations. Runoff carries pollutants and silt which contaminate water supplies. Effective ways to combat erosion and protect water quality include geotextile matting, completing excavation in stages to limit the time of exposure and protecting storm drains with silt fences or hay bale barriers. Methods of controlling dust and air pollution are also a primary responsibility of the contractor and are required by law in most jurisdictions. The building landscaping is also an important part of sustainable construction. Sustainable landscapes maximize the recycling of resources, nutrients and by-products, and produce minimal waste. Ornamental plant species should be chosen with regard to the vegetative species that existed in the area under natural conditions. Ideally, only captured or recycled water should be used for irrigation. If landscaping falls under control of the general contractor, consulting with a landscape architect to select plants indigenous to the area may even eliminate the need to install a permanent irrigation system. One design aspect of some sustainable landscapes is a “green roof”. Somewhat resembling a sod roof, a green roof is a roof that is covered with grass or other plant species. Green roofs can reduce building energy costs by ten percent, decrease summer roof temperatures significantly and reduce rainwater runoff (Kibert 2005). Green roofs also filter out pollutants, which in turn helps protect the water supply.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Green roofs are gaining popularity; a 72% growth in green roof square footage for North America was noted between 2004 and 2005, while in the United States an 80% growth was noted for the same period. North American green roofs increased in area from 1.3 million square feet in 2004 to 2.5 million square feet in 2005 (80% North American Greenroof Growth 2006). Green roofs can be very beneficial in urban areas with wet climates because large areas of roof and pavement create a tremendous quantity of storm water runoff. The City of Chicago and City of Portland both provide incentives to owners who integrate a green roof into their building’s construction. In Title 33 of the Portland Zoning Code, a floor area bonus exists for projects that install green roofs in the city’s central business district (Case Studies 2006). The density bonus allowed for a specific building depends on the square feet of green roof in relation to the building’s footprint. There are three levels of incentive listed: 1) 10-30% of building’s footprint is covered with green roof earns an additional 1 ft2 of floor area per ft2 of green roof. 2) 30-60% of building’s footprint is covered with green roof earns an additional 2 ft2 of floor area per ft2 of green roof. 3) 60% or greater of building’s footprint is covered with green roof earns an additional 3 ft2 of floor area per ft2 of green roof. Water Use in Sustainable Buildings Water resources are another important consideration in sustainable construction. Water is a finite resource; only 0.3 percent of the world’s water is available for everyday human use (Water Efficiency 2006). Creating large quantities of potable water, especially in drier climates, can place severe strains on hydrologic and energy resources. Water conservation is important in a sustainable building; this can be accomplished with low-flow plumbing fixtures, by rainwater re-use, and through utilizing drought resistant plants in the building landscaping. A workable combination of these elements will create a sustainable building that gets the most use out of the water that enters. Two major situations must be considered when designing or constructing a building with regard to its water supply, water needed and wastewater generated. When designing a sustainable building, the goal is to reduce water quantity required and reuse as much waste water as possible. The first step towards lowering water consumption in a green building is specifying low-flow fixtures. The National Energy Policy Act of 1995 required all plumbing fixtures produced in the U.S. to meet specific requirements of 1.6 gallons of water or less per flush for toilets and 1.0 gallon or less for urinals. Sustainable construction takes this a step further and encourages the use of gravity-tank toilets, dual flush toilets, flushometer toilets, and vacuum assisted toilets.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

The dual flush toilet has two flushes, one for smaller needs requiring one gallon per flush and the other at the maximum rate of 1.6 gallons per flush. Waterless urinals are another option for controlling water usage by plumbing fixtures. In a waterless urinal the conventional water-filled trap drain is replaced by a disposable trap inserted in the urinal outlet. The trap holds a layer of liquid floating on top of a urine layer. This combination trap seal blocks out sewer gases while the covering liquid layer blocks urine odors from the room. The liquid normally lasts over 1,500 uses, which replaces up to 4,500 gallons of water (“How They Work” 2006). Other methods of reducing water usage include installation of showers, faucets and drinking fountains with lower flows or with electronic controls. Some buildings have recorded seventy percent water savings after installing electronic controls on their fixtures (Kibert 2005). Since the contractor is responsible for purchase and installation of plumbing fixtures, he/she can significantly reduce the quantity of water used by any building through selection of appropriate fixtures. The second aspect of water use is the disposal of waste-water. Some wastewater must be treated, but water that has been used but not contaminated with human waste can be used for landscape irrigation or to flush toilets. This water is commonly referred to as greywater. Using greywater for landscape irrigation and to flush toilets requires some additional plumbing and water storage, but it significantly contributes to reducing the quantity of water used over the entire lifetime of the building. Installation of a greywater system is normally specified by design professionals, but retrofitting a building under construction to include this type of system is well within the expertise of the average contractor. Rainwater harvesting is another method to make use of the water that a building receives external to the city’s distribution system. Rainwater can be collected and used without treatment in the same manner as greywater, for irrigating landscaping or for flushing toilets. In extremely dry climates rainwater can be collected, filtered, treated and used as a potable water source. Potable water requires an extensive treatment system which is usually fairly expensive, so the best use for harvested rainwater is normally landscape irrigation. Rainwater harvesting has become an increasingly popular way to conserve water. Rainwater harvesting systems are required by law in new construction in Bermuda and the US Virgin Islands (“Harvested Rainwater” 2006). Government incentives are sometimes offered as well. California offers a tax credit for rainwater harvesting systems and financial incentives are offered in specific cities in Germany and Japan (“Harvested Rainwater” 2006). Building Energy Requirements The primary uses of energy within buildings include heating and cooling demands and building illumination. Natural illumination is very important in a sustainable structure. The term daylighting is used to describe providing natural light to increase illumination as well as help reduce heating and cooling costs. Not only does daylighting assist in lowering building operating cost, but it also has been shown that


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

people are more productive and healthier when working in natural light (Kibert 2005). Daylighting combined with modern technology can produce outstanding results. Buildings have been constructed that include sensors to measure the level of natural light in a room and automatically turn off the interior lighting (thereby saving energy) when sufficient natural light is available (Meyerson 2005). Energy use is another significant concern of sustainable construction. The cost of energy will always increase with the passage of time. In this environment, a sustainable building must be designed with energy conservation in mind. The building shell should be designed and constructed to resist heat transfer. A sustainable building should also employ renewable energy sources and incorporate passive solar design whenever possible. Passive solar design consists of using the building’s geometry, orientation, and mass to influence the way the building is heated and cooled, thus saving energy. Spatial orientation on a specific site can make a building much more energy efficient without adding to the cost of construction. Providing passive ventilation through design is another method of controlling building energy usage. Ventilation is usually accomplished by using fans, dampers and other controls to circulate air throughout a building. These usually require electricity and contribute to the energy demand of the building. Passive ventilation uses natural forces to circulate air. The most common method of passive ventilation involves use of windcatchers. Windcatchers are devices built into a structure which turn with the orientation of the wind and create suction (or pressure) which drives air through the building. Clean air commonly enters at the base of the structure and, as it is heated by sunlight, body heat and electronics, rises and is carried out the top. Many other factors influence how a building can lower its energy consumption including window selection, wall systems, and various solar heating systems. Combining some or all of these elements with those discussed above will create a building that efficiently uses the energy supplied without making unreasonable demands on the environment. Sustainable Building Materials Perhaps the most significant role of the contractor working on a sustainable building project lies within the area of materials selection. Kibert (2005) outlines three priorities for contractors when selecting building materials for a sustainable project: 1) The primary emphasis should be on reducing the quantity of material needed for construction. 2) The second priority is to reuse materials and products from existing buildings. 3) The third priority is to use materials and products with recycled content that are themselves recyclable or to use products and materials that are created from renewable resources. Wood plays a leading role in construction today and is important as a sustainable building material because wood is a renewable resource. Wood used in construction includes dimensional lumber, engineered wood, plywood and other composite wood


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

products. For sustainable construction projects, wood should come from sustainably managed forests and should be certified accordingly. Depending on where a project is located, obtaining certified wood may be difficult. However, over 108 million acres of forest have been enrolled in the Sustainable Forest Initiative (SFI) program and more is being added each year (Kibert 2005). Concrete is another important element in many buildings and has many beneficial environmental attributes. These attributes include its high strength, local availability, resistance to fire and insects, durability, and ability to be easily cleaned. The problem with concrete is the cement used to create it comes from plants that produce high levels of carbon dioxide. One way to offset this is to use flyash or furnace slag as a replacement for a percentage of the cement in the concrete mix. In addition to offering environmental advantages, fly ash also improves the performance of concrete. “Flyash affects the plastic properties of concrete by improving workability, reducing water demand, reducing segregation and bleeding, and lowering heat of hydration. Flyash increases strength, reduces permeability, reduces corrosion of reinforcing steel, increases sulphate resistance, and reduces alkali-aggregate reaction. Flyash reaches its maximum strength more slowly than concrete made with only Portland cement. The techniques for working with this type of concrete are standard for the industry and will not impact the budget of a job” (“Flyash Concrete” 2006). Use of fly ash as a replacement for cement can help create a sustainable structure while at the same time improving material quality. Another useful attribute of concrete is that it can be recycled. Crushed concrete is often used as a base for roads, sidewalks and slab-ongrade foundations. Steel and other metals are also an integral part of many sustainable buildings. Steel is an excellent material for use in sustainable buildings because it is almost one hundred percent recyclable. Each ton of steel recycled saves 2,500 pounds of iron ore, 1400 pounds of coal and 120 pounds of limestone (Kibert 2005). About 80% of the total embedded energy is saved by recycling steel as opposed to creating new steel from iron ore. Aluminum is also a very readily recycled material, which in certain applications, functions very well as a building material. Another principle of materials used for sustainable buildings is that materials selected should be created and fabricated locally whenever possible, as local materials require less energy to transport to the construction site. This aspect of construction is directly under the control of the contractor of his/her purchasing agents. The materials that go into a building are important in sustainable construction but just as important is the method by which they are fastened together. Sustainable construction incorporates the idea that over time buildings change and structures become obsolete. Buildings must be periodically refurbished and remodeled, which generates construction waste. Buildings should be designed and built so that they can be easily taken apart and recycled. This process is commonly referred to as “Design for Deconstruction and Disassembly”. Buildings designed for deconstruction and disassembly should minimize the number and types of materials incorporated, use


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

mechanical rather than chemical connections whenever possible, and use modular design (“Design for Disassembly in the Built Environment” 2006). Other important aspects of deconstruction include providing access to building components, providing adequate room between materials to allow for disassembly and possibly most important of all, retaining information on the building and its assembly process. An example of design for disassembly is Rinker Hall at the University of Florida, where the steel connections were bolted and left exposed. Leaving the connections exposed allows future generations to easily disassemble and remove the beams, minimizing waste. If residential construction designed between 2000 to 2050 were to allow for recovery of just 25% of the materials used, these materials would be sufficient to build about two-thirds of the housing units needed during the next 50 years (“Design for Disassembly in the Built Environment” 2006). Designing and constructing buildings for disassembly is an important step toward reducing waste in future generations. Indoor Air Quality Sustainable buildings must meet standards for Indoor Air Quality (IAQ) as outlined in Sections 4 through 7 of ASHRAE 62.1-2004, Ventilation for Acceptable Indoor Air Quality for air conditioned buildings and ASHRAE 62.1-2004, paragraph 5.1 for naturally ventilated buildings. Contractors must install ventilation systems which meet or exceed the minimum ventilation rates described in the ASHRAE standard, balance the ventilation rates with regard to energy use and indoor air quality and optimize ventilation rates for energy efficiency and occupant health. Heating, ventilating and air conditioning system requirements are usually specified by the designer. However, the contractor is responsible for credits awarded toward LEED certification under IAQ Management Plans which meet or exceed the Control Measures of the Sheet Metal and Air Conditioning National Contractors Association IAQ Guidelines for Occupied Buildings under Construction, Chapter 3. The contractor can gain additional credits for developing an IAQ Management Plan which flushes out the total volume of the air in the building after construction ends but prior to occupancy (LEED for New Construction 2005). Materials selected by the contractor or his/her purchasing agent are a method of influencing IAQ and obtaining LEED credits. IAQ standards seek to reduce indoor air contaminants that are odorous or potentially irritating and/or harmful to the comfort and well-being of installers and occupants. Four categories of materials are important for sustainable construction projects, including sealants and adhesives, paints and coatings, carpet and composite wood. Adhesives and sealants must meet the standards outlined in Adhesives, Sealants and Sealant Primers: South Coast Air Quality Management District Rule #1168 while paints and coatings must meet the volatile organic compound (VOC) content limits established in Green Seal Standard GS11. Carpet must meet the standards described in Section 9, Acceptable Emissions Testing for Carpet, California Department of Health Services Standard Practice, CA/DHS/EHL/R-174 dated 07/15/04 while composite wood can contain no urea-


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

formaldehyde resins. Use of approved products will alleviate concerns about breathing potentially harmful compounds by workers during construction and by building occupants years later. Incentives for Sustainable Buildings Many aspects of sustainable construction are already being phased into practice across the United States, helped by incentives from cities, states and the federal government. Two states (Maryland and Nevada) require state funded buildings to earn minimum LEED certification, while two others (New York and Oregon) provide tax incentives for buildings which earn LEED certification. Six cities currently provide significant tax incentives for buildings achieving various levels of LEED certification, four cities provide expedited permit review processes for buildings seeking LEED certification, and six others provide monetary grants or other types of incentives, such as waiving specific code requirements (Summary of Government LEED Incentives 2006). The federal government encourages sustainable construction on all major both construction and renovation projects. The renovation of the Pentagon, which suffered damage during the terrorist attack in 2001, was completed as a sustainable construction project. Some features include ninety percent of all concrete and metal was diverted from landfills, installation of highly efficient lighting systems, use of recycled gypsum wall board and high recycled-content carpet. Fan-powered air induction units were installed that reduced the amount of ductwork in the building. This allowed the ceiling to be raised twenty-three inches, which increased natural light and reduced the number of mechanical rooms from 118 per wedge in the old part of the building to nine per wedge in the new part of the building. A wall system was also devised to allow for easy space reconfiguration, which will greatly reduce future construction waste (Field Guide for Sustainable Construction 2004). Another building project which resulted from incentives for sustainable construction is the Solaire. The Solaire is a residential high rise building in New York City and is the first high rise building designed to be sustainably built. It is designed to consume 35% less energy and conserve 50% more water than traditional high rise buildings. At the same time the building will provide higher indoor air quality and a greater amount of natural light than conventional high rises. (NYC Green Building Profiles 2004). One of the Solaire's resource-efficient features is photovoltaic cells that contribute 5% of the building's electric load. Fresh air and filtered water in every apartment and storm and waste reclamation systems are also important green aspects of this building. In addition to the elaborate design for the building, more than 93% of the waste generated by construction was recycled (Meyerson 2005). The financial incentive to "build green" came in the form of a New York state tax credit, enacted in January 2001, to encourage the construction of environmentally sound buildings. The New York State Green Building Tax Credit Legislation has six different components under which a taxpayer (owner or tenant) might receive credit.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

These include whole building, base building, tenant space, fuel cell, photovoltaic module and green refrigerant credits (New York State Green Building Tax Credit Legislation Overview 2006). Taxpayers are required to maintain forms showing compliance and must present their records to the Department of Environmental Conservation each year when the credit is claimed. SUMMARY AND CONCLUSIONS The contractor has a significant role to play in sustainable construction, at times and on specific projects, more than the architect or engineer. The degree of contractor involvement is heavier when sustainable construction is incorporated later into the design process. Sustainable construction is rapidly expanding to become an important segment of the U.S. construction industry. Demand for contractors with knowledge of and experience with sustainable construction practices will continue to increase. With the rise in energy prices and current rate of resource depletion, sustainable construction is steadily becoming more in demand by clients who appreciate its benefits and wish to enjoy the decreased costs associated with conservation of resources. Contractors are encouraged to become involved with sustainable construction, not just because of the business opportunities, but because of the lasting legacy that sustainable projects will leave for future generations. Some cities and states have implemented tax breaks for sustainable buildings; others are willing to waive specific code requirements, which can provide significant additional incentives to incorporate sustainable construction into a project. Sustainable construction benefits owners through reduced life cycle costs, benefits people who live and work within a structure by providing an environment conducive to optimum health and working conditions and benefits the environment by reducing the resource demands of the building. REFERENCES “80% North American Greenroof Growth.” (2006) Greenroofs.com. <http://www.greenroofs.org/resources/surveypressrelease.pdf>.

9 Apr. 2006

“Case Studies of Green Roofs in North America. United States. City of Portland.” (2006) Green-Rated.org. 12 Jun. 2006 <http:commons.bcit.ca/greenroof/publications/2006_regulations.pdf> “Design for Disassembly in the Built Environment.” (2004) United States Environmental Protection Agency. July 2004. 13 Apr. 2006 <http://www.epa.gov/oswer/docs/iwg/ fs_design_for_disassembly_draft.pdf>. Field Guide for Sustainable Construction (2004). Partnership for Achieving Construction Excellence, Pentagon Renovation and Construction. U.S. Department of Defense. 13 Feb. 2006 <http://http://renovation.pentagon.mil/sustainfieldguide.htm>.


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“Flyash Concrete.” (2006) Greenbuilder. 12 Apr. 2006 <http://www.greenbuilder.com/ sourcebook/Flyash.html>. “Harvested Rainwater.” (2006) Greenbuilder. <http://www.greenbuilder.com/ sourcebook/ Rainwater.html>. “How They Work.” (2006) Waterless <http://www.waterless. com/how.php>.

No-Flush

12

Urinals.

Apr.

10

Apr.

2006

2006

Kibert, C. (2005) Sustainable Construction Green Building Design and Delivery. Hoboken: John Wiley & Sons. LEED for New Construction & Major Renovations, (2005) Version 2.2, U.S. Green Building Council, Washington, D.D, . Meyerson, A. (2005) “The Dollars and Cents of Green Construction.” American Institute of Certified Public Accounts. 7 Apr. 2006 <http://www.aicpa.org/pubs/jofa/may2005/ meyerson.htm>. “NYC Green Building Profiles: 2004 Green Buildings Open House.” (2004) Green Home NYC. Feb. 2006 <http://www.greenhomenyc.org/page/ bldgprofile?year=2004&building_id=9>. “New York State Green Building Tax Credit Legislation Overview.” (2004) New York State Department of Environmental Conservation. 12 Jun. 2006 <http://www.dec.state.ny.us/website.ppu/grnbldg/legis.html>. Summary of Government LEED Incentives (2006) 5 Jan. 2007. <https://www.usgbc. ShowFile.aspx?DocumentID=2021>. “Water Efficiency.” (2006) United States Environmental Protection Agency. 13 Apr. 2006 <http://www.epa.gov/owm/water-efficiency/>

Wayne G. Jensen, PhD, PE, LEED-AP received his PhD and Master of Science degrees in Civil Engineering from the University of Wyoming. He teaches materials and methods classes within the Construction Management Program at the University of Nebraska. Dr. Jensen is currently involved in two research projects which involve incorporating residual materials into construction projects. Anthony Kouba is a student at the University of Nebraska Lincoln who is majoring in construction management. He is currently completing his third year of studies in the Honor’s Program and has completed an independent undergraduate research project on the subject of sustainable construction under Dr. Jensen’s supervision.


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Strategic Planning Comprehensiveness and Performance William D. Gardner, MS and Dennis C. Bausman, PhD, CPC ABSTRACT The purpose of this study was to investigate comprehensive strategic planning in the construction industry. The primary research objective was to determine if there is a relationship between comprehensive strategic planning and performance among large general building contractors in the United States. The performance measures evaluated are return on investment (ROI) and annual revenue growth. These performance measures were evaluated over a five year period. Firms practicing a higher level of comprehensive strategic planning were evaluated against firms practicing a lower level in order to determine the comprehensive planning and performance relationship. This study found no relationship between planning comprehensiveness and performance relative to average annual percent revenue growth or ROI. However, a positive relationship in ROI growth trend and planning comprehensiveness was found to exist. In addition, specific individual measurements of planning comprehensiveness that support stronger trends in ROI and revenue growth are delineated in the findings of this study. Key Words Strategic Planning, Planning Comprehensiveness, Strategy, Construction INTRODUCTION Chinowsky (2000) points out that “the basic concept of strategy is that of an idea; specifically, an idea that sets in place a path that responds to multiple internal and external influences” and thus “strategy is defined as the underlying concept that responds to, or anticipates, industry conditions for the purpose of developing long-term plans” (p.2). Strategy development and implementation requires a substantial investment of organizational resources and can often necessitate strategic re-deployments of organizational resources adversely affecting near-term financial performance in anticipation of greater long-term rewards (Clough and Sears, 1994). A number of studies have examined the planning-performance relationship in the construction industry. Hall (1994) and Weston (1996) studied small companies in the UK and found limited use of formal strategic planning to create and implement strategic objectives. Wilson (1994) points out that smaller firms typically do not have a well-defined strategic planning process due to the active involvement in the company of the entrepreneur-owner and the lack of


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

organizational complexity. Studies evaluating the planning activities of larger construction companies in the United States and the UK have shown that the use of strategic planning is extensive (Chinowsky, 2001; Hasso, 1996; Hillebrandt & Cannon, 1990, Sayid-Rayab, 1981). However, in many companies the planning process is not fully developed or implemented (Chinowsky, 2001; Hasso, 1996; Hillebrandt & Cannon, 1990). In addition, previous studies have found that the strategic planning process of construction companies has typically been focused internally on operational issues and not on strategic analysis of the firm’s operating environment, organizational objectives and/or strategies (Junnonen, 1998; Ramsay, 1989; Skidmore, 1989). Bausman (2002) noted {based on earlier studies}, “there is very ‘tentative’ empirical support for a strategic planning-performance relationship in the construction industry” and research regarding strategic planning in the construction industry “has been limited to studies examining subjective measures of performance (Pienaar, 1988), techniques of plan formulation (Edum-Fotwe et. al., 1994), organizational ‘factors’ exhibited by successful firms (Konchar and Sanvido, 1999), and/or identification of strategic management practices (Chinowsky, 2000, 2001)” (Bausman, 2002, p. 14). In Bausman’s 2002 study he evaluated the planning constructs of: flow, formality, comprehensiveness, participation, intensity, and integration for large general contractors. Planning flow relates to the direction of information generation and plan formation (top down, bottom up, etc). Formality addresses the structure of a firm’s planning process and procedures. Comprehensiveness is defined as the degree of situation diagnosis, alternate generation, alternate evaluation and decision integration. Participation involves the extent to which employees are included in the planning process. Intensity deals with the frequency of plan updating and the level of management commitment of time and resources to the planning process. Lastly, integration is the extent to which the strategic plan is incorporated and communicated in the on-going activities of the organization. His study did provide empirical support for the planning-performance relationship for large general building contractors. Bausman (2002) concluded that: 1) planners outperformed non-planners based on return-on-investment (ROI); and 2) a positive relationship existed between performance and planning intensity and plan integration. However, he found no relationship between performance and the planning constructs of flow, formality, comprehensiveness, and participation. The lack of a relationship between strategic planning comprehensiveness and performance in Bausman’s study is perplexing. His study found a relationship between strategic planning and performance, but concluded that the degree of planning comprehensiveness had no correlation with company performance. However, his evaluation of the planning comprehensiveness construct was quite


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

limited. Therefore, the primary objective of this research was to expand the focus of planning comprehensiveness in order to further evaluate the existence, or non-existence, of the strategic planning comprehensiveness – performance relationship of large general contractors. METHODOLOGY Moderating Variables Organizational performance for contractors can be influenced by a number of moderating variables present within the firm’s operating environment. Moderating variables of note for this research were: industry type, construction type, company size, geographical area of operation, and contracting method. Similar to Bausman’s 2002 study, this research effort was designed to mitigate or minimize the influence of these variables. This study was limited to the construction industry and to minimize the impact of contracting type and size the study population was restricted to companies with fifty percent or greater of their annual revenue in “general building,” and an annual volume of $50 million or greater. The study population was also limited to general contractors that perform a minimum of ninety percent of their annual volume in the United States. Lastly, this study accounted for the performance-risk relationship by collecting and reviewing data regarding the percentage of a firm’s work that is “at-risk”. Sample Design The sampling frame for this study was based on a combined listing of contractors from Dun & Bradstreet and Engineering News Record Top 400 that met the study criteria. Collectively, 666 construction companies thought to meet the criteria were identified using these two sampling frames. The unit of analysis was the strategic business unit of the company and the targeted respondent was the CEO of the firm. Data Collection A self-administered survey was utilized to collect data. The survey questionnaire was designed to delineate the key elements of comprehensive strategic planning, divided into the pre-planning, planning and post-planning phases. In addition to qualitative questions, nineteen questions collected quantitative data based on a five point Likert scale: 5 (very comprehensive), 4 (comprehensive), 3 (moderately comprehensive), 2 (cursory) and 1 (not done). The intent was to have the respondent indicate the degree, or level, of strategic planning comprehensiveness for each of the planning elements. Each questionnaire was accompanied by a personalized cover letter and a summary of the survey results was offered to each respondent. To make the response easy and convenient, a self-addressed, stamped, envelope was


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

included. Specified deadlines for return of the completed survey were noted, and the anonymity of the respondent and the company were assured. By the cutoff date a total of 165 responses were received. Of this total, 38 were not usable because the firm did not meet the study criteria or the response was incomplete. In total, 127 usable responses were received yielding a usable response rate of 20.2% of the net population (see Table 1).

Table 1. Usable Respondents Total Responses Rejected Responses Incomplete Surveys Ineligible – did not meet study criteria Total Rejected Net Usable Respondents Meeting Study Criteria

165

(24.7% of recipients)

15 23 38 127

(20.2% of net population)

The annual volume of the 127 usable respondents ranged from $50m to $7 billion with an average annual revenue of $313m. The average ROI for the usable respondents in this study during the five year period 2000-2004 is 21.3% FINDINGS AND ANALYSIS Based on the interval scale responses, a comprehensive planning average was established for each respondent. Those companies with a higher level of planning comprehensiveness were tested against companies using a lower level. In addition, the ROI and revenue growth trends of companies with a higher comprehensive planning level were compared to companies with a lower comprehensive planning level. Paired t-testing techniques with a level of significance of 0.05 were used to evaluate the existence of a relationship between strategic planning comprehensiveness and performance. Performance indicators collected from the respondents included, a) average annual return-on-invest (ROI) over the 5-year period from 2000 to 2004, b) annual revenue for the years 2000 and 2004 which were used to calculate an average annual revenue growth over the period, c) revenue trend over the 5-year period, and d) ROI trend over the 5-year period. Return on investment (ROI) was the percentage of ‘net profit before taxes’ divided by the tangible equity as of the end of the fiscal period. Revenue and ROI trends were measured by the respondents’ selection of: 1 – rapidly declining, 2 – declining, 3 – erratic, 4 – stable, 5 – mild growth, 6 – moderate growth, or 7 – strong growth.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Revenue Growth and Revenue Trend Revenue Growth: Revenue growth for each respondent was calculated based on the annual revenue growth percentage over the five year period. To examine the relationship between revenue growth and comprehensive planning, survey respondents were placed in two separate groups – those with a comprehensive planning average of 3.0 or less (non-comprehensive planners) versus firms with an average greater than 3.0 (comprehensive planners) based upon the respondent’s answers to the quantitative questions. When subjected to testing, there was no statistically significant difference in revenue growth between these two groupings. Extending this statistical comparison to firms with Low comprehensiveness (less than 2.0) and High comprehensiveness (4.0 or greater) levels of planning yielded similar results. There was no statistically significant difference in revenue growth between the two groupings. Revenue Trend: To evaluate the effect of comprehensive planning on revenue trend, survey respondents were placed in two separate groups. One group had a trend from 1-3 (rapidly declining to erratic) and the second group with a trend from 6-7 (moderate to strong growth). Comparative statistical testing between these two groups resulted in finding that no relationship existed between comprehensive strategic planning and the firm’s revenue growth trend. Comprehensiveness – Revenue Relationship Summary: Based upon the statistical testing of planning comprehensiveness with both absolute revenue growth and growth trends, a revenue – planning comprehensiveness relationship was not evident. Return-on-Investment (ROI) and ROI Trend Average Return on Investment: Return on investment (ROI) is the percentage of ‘net profit before taxes’ divided by the tangible equity, or investment, as of the end of the fiscal period (Jackson, 1999). Similar to the testing for revenue growth, survey respondents were placed in two separate groups: non-comprehensive planners were compared with comprehensive planners. When subjected to statistical testing, no relationship was found between planning comprehensiveness and average percent ROI over a 5-year period. Again, when extending this statistical comparison to firms having Low comprehensiveness with those exhibiting a High level of comprehensive planning still no relationship was found. A relationship between comprehensiveness and the firm’s average percent ROI over a 5-year period did not exist. ROI Growth Trend: To evaluate the affect of comprehensive planning on ROI trends, survey respondents were again placed in two separate groups. One group had a trend from 1-3 (rapidly declining to erratic) and the second group


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

had a trend from 6-7 (moderate to strong growth). Comparative statistical testing between these two groups resulted in finding that a relationship does exist between comprehensive strategic planning and the firm’s ROI growth trend. Firms with a higher level of planning comprehensiveness had a stronger ROI growth trend. Comprehensiveness – ROI Relationship Summary: They was no relationship between a snapshot, or average, of a firm’s ROI over a 5-year period, but there was a relationship between the firm’s ROI growth trend and planning comprehensiveness – strategic planners with a higher level of planning comprehensiveness have a stronger ROI growth trend. Evaluation of Individual Comprehensiveness Measures In addition to testing the overall planning comprehensiveness average versus revenue and ROI growth trends, each individual measure of planning comprehensiveness was evaluated to determine if it had a relationship with firm performance. A summary of the findings for each measurement are tabulated in Table 2. Revenue Growth Trend: An evaluation of the revenue growth trend reveals that three of the 19 survey questions supported the hypothesis that firms with a higher comprehensive planning level have a stronger revenue growth trend than firms with a lower comprehensive planning level. The three measurements (questions) supporting this hypothesis were: 1) annual evaluation to review our company’s past performance regarding revenue, gross profit and net profit; 2) annual evaluation to review our company’s past performance regarding return on investment, working capital and cash flow; 3) annual evaluation to review our company’s current conditions such as analysis of competitors. All of these questions are in the pre-planning category of comprehensive strategic planning as opposed to the planning or post-planning phase. Thus, the data supports that a more comprehensive focus on specific pre-planning areas regarding the company’s past financial performance and current conditions relative to competitors leads to a stronger revenue growth trend. ROI Growth Trend: An evaluation of the ROI growth trend reveals that seven of the nineteen survey questions supported the hypothesis that firms with a higher comprehensive planning level have a stronger ROI growth trend than firms with a lower comprehensive planning level. The seven questions supporting this hypothesis were: 1) the annual survey of our employees regarding our company’s strengths, weaknesses, opportunities, and threats; 2) the annual evaluation to review our company’s past performance regarding revenue, gross profit and net profit; 3) the annual evaluation to review our company’s past performance regarding return on investment, working capital and cash flow; 4) the annual evaluation to review our company’s current conditions such as analysis of current political, economic and regulatory conditions; 5) the degree to


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1

which our strategic plan and objectives are communicated clearly and frequently to all employees; 6) the degree to which detailed action plans are developed for each strategic objective; and 7) the degree to which top management performs on-going monitoring of progress toward strategic plan objectives.

Table 2. Revenue and ROI Growth Trends

Measurement (Question)

Revenue Trend Group 1-3 vs. Trend Group 6 & 7

ROI Trend Group 1-3 vs. Trend Group 6 & 7

*1 All responses based on an interval scale of 1-5 for * Statistical Statistical planning comprehensiveness Significance Significance

Survey Questions The annual survey of our employees regarding our company's strengths, weaknesses, opportunities, and threats is: The annual survey of our customers regarding our company's strengths, weaknesses, opportunities, and threats is: The annual survey of our suppliers regarding our company's strengths, weaknesses, opportunities, and threats is: The annual survey of our subcontractors regarding our company's strengths, weaknesses, opportunities, and threats The annual evaluation to review our company's past performance regarding revenue, gross profit and net profit is: The annual evaluation to review our company's past performance regarding return on investment, working capital The annual evaluation to review our company's current conditions such as analysis of customers is: The annual evaluation to review our company's current conditions such as analysis of our market is: The annual evaluation to review our company's current conditions such as analysis of company manpower is: The annual evaluation to review our company's current conditions such as analysis of company financial resources is: The annual evaluation to review our company's current conditions such as analysis of competitors is: The annual evaluation to review our company's current conditions such as analysis of current political, economic and The annual evaluation to analyze future conditions through forecasting of future economic, political, technology & The degree to which top management annually generates multiple alternatives regarding each possible goal or course of The degree to which top management annually evaluates multiple alternatives regarding each possible goal or course of The degree to which our strategic plan and objectives are communicated clearly and frequently to all employees is: The degree to which detailed action plans are developed for each strategic objective is: The degree to which management performance evaluations are closely linked to achievement of strategic objectives is: The degree to which top management performs ongoing monitoring of progress toward strategic plan objectives is:

Y

N

Y

N

Y

N

N

N

N

N

N

N

Y

Y

Y

Y N

N

N

N

N

N

N

N

Y

N N

Y

N

N

N

N

N

N

N

Y

N

Y

N N

N Y


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statistical significance: testing the hypothesis that firms using a higher level of comprehensive planning relative to a specific survey question have a stronger revenue growth trend than firms using a lower comprehensive planning average. Y= yes and N= no. *1 statistical significance: testing the hypothesis that firms using a higher average of comprehensive planning relative to a specific survey question have a stronger growth trend than firms using a lower comprehensive planning average. Y= yes and N= no.

Four of the questions providing support that more comprehensive planning leads to a stronger ROI growth trend were in the pre-planning phase. The testing results indicate that companies which have a stronger ROI growth trend tend to focus more comprehensively on internal environmental conditions (employees and financial performance indicators) rather than external environmental conditions such as customers, suppliers, subcontractors and competitors. Analysis of the survey questions which address planning phase elements evidenced that comprehensiveness during the planning phase does not result in a higher ROI growth trend. The implication is that generation and evaluation of multiple alternatives regarding each possible goal or course of action does not lead to a stronger ROI growth trend. Interestingly, three of the four measurements (questions) in the post-planning category of comprehensive strategic planning provided support for a relationship between comprehensiveness and performance. The findings indicate that a higher level of comprehensiveness in the post-planning or implementation phase of strategic planning is associated with an improved ROI growth trend. The level of comprehensiveness regarding communication of plan objectives, development of action plans, and plan monitoring have a positive influence on performance. CONCLUSIONS Similar to Bausman (2002), this study found no relationship between strategic planning comprehensiveness and the annual percentage revenue growth of a firm or its revenue growth trend over the past five years. Firm performance, as measured by revenue growth, is not associated with planning comprehensiveness. This study also found no relationship between a firm’s average percent returnon-investment over a five year period and planning comprehensiveness. A snapshot of a firm’s ROI had no relationship with the firm’s strategic planning comprehensiveness. However, when firm performance was evaluated over a period of time, there was a relationship between performance and planning comprehensiveness. Firms with a higher level of strategic planning comprehensiveness had a more positive ROI growth trend. Planning comprehensiveness improves performance, as measured by the firm’s trend for return-on-investment.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

The positive relationship between comprehensive planning and ROI growth trend indicates that general building contractors that perform more comprehensive evaluation of their 1) internal environmental conditions regarding employees’ perceptions about the company’s strengths, weaknesses, opportunities and threats, 2) past performance regarding revenue, gross profit, net profit, return on investment, working capital and cash flow, and 3) external environmental conditions regarding current political, economic and regulatory conditions, have stronger ROI growth trends. In addition, companies that practice a higher level of emphasis on implementation, evaluation and control of their strategic plan objectives through 1) clear and frequent communication of strategic plan objectives to employees, 2) development of detailed action plans for each strategic objective, and 3) top management’s ongoing monitoring of progress toward strategic plan objectives, have stronger ROI growth trends than companies that perform less comprehensive planning. Planning comprehensiveness during development and implementation improves a contractor’s financial performance, as measured by the firm’s trend for return-oninvestment.

BIBLIOGRAPHY Bausman, Dennis C. (2002). An empirical investigation of the relationship between strategic planning and performance of large construction firms. Edinburgh, Scotland: Heriot-Watt University. Chinowsky, Paul. (2000). Strategic management in construction. Construction Engineering and Management, Jan/Feb, 1-9.

Journal of

Chinowsky, Paul. (2001). Successful directions. Marietta, GA: PM Publishing. Clough, Richard H. & Sears, Glenn A. (1994). Construction contracting. New York: John Wiley and Sons. Edum-Fotwe, F.T., Price, A.D. & Thorpe, A. (1994). Strategic management for construction contractors. ARCOM Conference, Loughborough University, Sept, 248-257. Hall, G. (1994). Factors distinguishing survivors from failures amongst small firms in the UK construction sector. Journal of Management Studies, 31, 737-760. Hasso, Mark H. (1996). Strategic systems model for the management of US international engineering and construction. Worcester Polytechnic. Hillebrandt, P.M. & Cannon, J. (1990). The modern construction firm. London: Macmillan.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Junnonen, J.M. (1998). Strategy formation in construction firms. Engineering, Construction and Architectural Management. 5, No.2, 107-114 Konchar, Mark, & Sanvido, Victor. (1999). Defining excellence in US construction companies. Pennsylvania State University: Computer Integrated Construction Research Program. Pienaar, Elizabeth J. (1988). A study to identify and evaluate the level of strategic management in the construction industry. South Africa: University of Pretoria. Ramsay, William. (1989). Business objectives and strategy. In Hillebrandt, Patricia M. and Cannon, Jacqueline (Ed.), The management of construction firms. Macmillan. Sayid-Rajab, Ziad T. (1981). An investigation into the nature and extent of corporate planning in construction companies. Edinburgh: Heriot Watt University. Skidmore, R.M. (1989). Contract bidding in construction: management and models. London: Longman.

Strategic

Weston, Philip. (1996). The consequence of pro-active strategic planning for competitive advantage in SMEs within the construction sector. London: Cobra (RICS). Wilson, Ian. (1994). Strategic planning isn’t dead – It changed. Long Range Planning, August, 20.

William D. Gardner has thirty years of experience in the construction industry, working primarily in general contracting and construction management. His experience includes positions as a field engineer, field superintendent, estimator, project manager, business development, Vice President and Executive Vice President of Construction. He has been employed by Dana B. Kenyon Company, Jacksonville, Florida, for ten years and is currently that company’s Executive Vice President of Construction. As EVP with Dana B. Kenyon Company, Mr. Gardner’s responsibilities include strategic planning, business development, preconstruction and construction management. Mr. Gardner has a Masters Degree in Construction Science and Management from Clemson University, an MPA in Finance from American University, Washington, DC, and has completed graduate studies in business at Georgetown University, Washington, DC. He completed his thesis at Clemson University on strategic planning in the US construction industry.


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Dr. Dennis C. Bausman has over 30 years experience in construction and construction education. Prior to his present position as an Assistant Professor in the Construction Science & Management (CSM) Department at Clemson University he was a commercial contractor. Dr. Bausman is co-editor of the American Professional Constructor, a Certified Professional Constructor, and serves as a member of the board for the American Institute of Constructors. He is on the review board for the Associated Schools of Construction, a member of the Panel of Arbitrators for the American Arbitration Association, and is actively involved in the training and continuing education programs of the National Center for Construction Education and Research.


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Second Career for the Constructor: Qualifications for Construction Education Faculty David E. Gunderson, PhD, CPC and Gene W. Gloeckner, PhD ABSTRACT Data collected from interviews and surveys indicate that the demand exceeds the supply for faculty to teach in postsecondary construction education programs. One of the sources for these faculty members has been second career seeking professions coming from the construction industry. These second career opportunities provide the professional constructor with an opportunity to give back to the construction industry while helping to provide a strong academic foundation for future constructors. If construction professionals do choose to seek a second career in construction education they need to know the required and preferred qualifications for these faculty positions. It was determined that these qualifications are in five categories: Academic degree earned, Experience in the construction industry, Ability to be a good teacher, Ability to be a good researcher, and Professional registration or certification. Key Words Construction Education; Postsecondary Teaching

Construction

Management;

Construction

Engineering;

INTRODUCTION During the 2004 â&#x20AC;&#x201C; 2005 academic year 32 postsecondary institutions posted advertisements for 38 open faculty positions in construction education. Every year there are a similar number of advertisements for open faculty positions in construction education. Construction education programs across the country are growing in popularity and the majority of the programs report a virtual 100% placement rate. Just as the graduates from construction education are in high demand by the construction industry, qualified faculty members are also in high demand. PROBLEM STATEMENT Since the research indicates there is a shortage of individuals to teach in construction education programs in the United States, the research question is: What are the qualifications for faculty positions in postsecondary construction education programs?

RESEARCH DESIGN


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

The selected research design for this study was mixed methods. “This is a type of research design in which qualitative and quantitative approaches are used in types of questions, research methods, data collection and analysis procedures, and/or inferences” (Tashakkori & Teddlie, 2003). RESEARCH IMPLEMENTATION This sequential exploratory mixed methods research design was implemented in two phases. An explanation of the implementation procedures for the first phase is presented followed by an explanation of the implementation procedures for the second phase. A goal of this research design is to provide triangulation which is one strategy “for providing validity and reliability” (Merriam, 2002). The triangulation for this research project is graphically presented in Figure 1. Figure 1: Triangulation uses “multiple investigators, sources of data, or data collection methods to confirm emerging findings” (Merriam, 2002, p. 31). Document analysis using 32 advertisements for 38 open faculty positions

Interviews with department heads in six construction education programs

Survey sent to 402 Faculty teaching in ACCE accredited construction education programs

Phase I The first part of the Phase I data collection was document analysis. The classified advertisements posted on the Associated Schools of Construction (ASC) web site were analyzed with respect to the number of vacant construction education faculty positions during the 2004 – 2005 school year. Also included in the first phase of this research design were interviews with CM department heads. Several strategies for promoting validity and reliability were used to establish trustworthiness. In addition to the triangulation described above, the researcher’s position has been acknowledged, and maximum variation has been included in the participant selection. Maximum variation is “purposefully seeking variation or diversity in sample selection to allow for greater range of application of the findings by consumers of the research” (Merriam, 2002). The purposeful criteria selection process is further detailed in the data collection section. An audit trail was also developed to increase trustworthiness. The audit trail consists of the open coded interviews and an Excel spreadsheet showing how the open


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

coded were grouped into axial codes. The following will describe the Phase I participants, the Phase I data collection, and the Phase I data analysis procedures.

Participants The participants in the qualitative first phase of this study were purposefully selected current department heads in construction management (CM) programs. These six individuals were from CM programs accredited by the American Council of Construction Education (ACCE). Individuals selected for the interviews had in excess of 10 years experience teaching in a CM program. The programs were narrowed to those that are ACCE accredited because there are many different types of construction education programs that may have various emphasis areas as evidenced by their accreditation through organizations other than ACCE. For example there are construction education programs that have received accreditation through the Accreditation Board for Engineering and Technology (ABET) or the National Association of Industrial Technology (NAIT). Academic programs that are accredited through ABET may have an engineering emphasis, and programs that are accredited through NAIT may have a technology emphasis. The Department of Education’s CIP for Construction Management resides under CIP #52, Business, Management, Marketing, and Related Support Services, thereby putting the emphasis on management rather than engineering or technology. The department chairs were purposefully selected so that the participants were from large programs and smaller programs, and from different parts of the United States. The intent was to interview department heads from a crosssection of construction education programs based on size (number of undergraduates), geographic region, and institutional emphasis (whether the university had a teaching or research emphasis). Data Collection The first part of the Phase I data collection was a document analysis of the classified advertisements for vacant construction education faculty positions posted on the ASC web site from the middle of August 2004 through the end of May 2005. The ASC sends an e-mail notification to all ASC faculty members announcing new advertisements for vacant faculty positions. These advertisements were printed and collected during the 2004 – 2005 school year. The telephone interviews with department heads in ACCE Construction education programs were recorded and transcribed. The transcribed interviews were coded using open, axial, and selective coding using a combined deductive and inductive approach to allow themes to emerge. These emergent themes were tested in the quantitative phase of data collection to see if the opinions and perceptions held by these department heads are consistent with the opinions and perceptions held by existing faculty members. The themes that emerged in the interviews provided questions that were asked in the primarily quantitative survey instrument sent to faculty members in ACCE accredited construction management programs.


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Data Analysis As stated above, the data gathered in the recorded and transcribed interviews was coded using open, axial, and selective coding to allow themes to emerge. A constant comparative method of analysis was used to guide subsequent interviews. Coded categories allowed themes to emerge. These categories are perspectives held by participants, process codes, activity codes, event codes, strategy codes, or relationship codes as examples (Bogdan & Biklen, 2003). The opinions and perceptions of the participants in the qualitative phase of the study form the emergent themes that helped guide the creation and modification of questions asked in the quantitative phase of the research. After analyzing the data from the fifth of six interviews, it became apparent that we were reaching saturation. Creswell (1998) states that the information coming from the data analysis becomes saturated when the data being collected become repetitive. The data analysis from the sixth interview confirmed that the information being gathered had become saturated. Member checking was done when requested by the participants. Member checking is â&#x20AC;&#x153;taking the data and tentative interpretations back to the people from whom they were derived and asking if they were plausibleâ&#x20AC;? (Merriam, 2002). Phase II The second phase of this research design was a questionnaire sent to 402 faculty members teaching in ACCE accredited programs. The following describes the Phase II participants, the Phase II data collection, and the Phase II data analysis procedures. Participants The target population for the quantitative phase of the research was the 402 faculty members in ACCE accredited construction management programs. The list of individual faculty members in these ACCE accredited programs was developed by going through the self-reported data on the ASC web site and cross checking the information by going to the web site of each of the CM programs and the link with their faculty members. The sample selected to receive a survey was the entire target population. The research design was to use a web based survey instrument, SurveyMonkey, with an e-mail sent to all faculty members in ACCE accredited programs notifying them of this survey.

Data Collection The survey was web-based. An e-mail was sent to participants informing them of the survey and its purpose. The e-mail included a link to the SurveyMonkey website. The potential participants included the 402 faculty members in ACCE accredited programs. Two reminder e-mails were sent to faculty members who had not yet


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

responded to the survey. Microsoft Excel and SPSS files were used to collect and store the data until analysis began. Data Analysis The data from the returned survey instruments were collected by SurveyMonkey, quantified using Microsoft Excel and/or SPSS, and presented as descriptive and associational statistics. Descriptive statistics were most useful in determining the required and/or preferred qualifications for faculty teaching in postsecondary construction education programs. QUALIFICATIONS FOR CONSTRUCTION MANAGEMENT FACULTY The qualifications of faculty teaching in CM programs were identified in the interviews with CM department heads, in the survey responses from CM faculty, and in the document analysis of advertisements for faculty positions posted on the Associated Schools of Construction (ASC) web site. These qualifications fall in four basic categories: earned academic degree, experience in the construction industry, the ability to be a good teacher, and the ability to do research. A preferred qualification of a faculty candidate that was specified in the advertisements but was not mentioned in the interviews with department heads or in the survey responses was professional registration or certification. Academic Degree Earned One of the interviewed CM department heads stated, “If you want to compete within academic circles, having a Ph.D. I think is mandatory.” Another department head stated that if [CM] faculty do not have a Ph.D. they are not an equal in academia.” One department head stated that in academia “you’ll always be a second class citizen unless you have a Ph.D.” Several of the interviewed department heads indicated that in most cases a faculty member needs to have a doctoral degree to be hired into a tenure-track position. They indicated that a faculty member who had only a master’s degree would be hired as a lecturer in a special appointment rather than into a tenure-track line. This was not unanimous since one department head stated that a master’s degree was the terminal degree for CM faculty at that university. However, this individual also felt that a Ph.D. was required for faculty in most other CM programs. One of the department heads felt that having a “Ph.D. in Education is good if they are going to teach.” This was the opinion of another department head when he stated that new faculty with industry experience need to know how to teach and need to learn about pedagogy, and “they could learn [this] in an educational doctorate program to become a better professor.” These opinions may have been summarized by the department head who stated, “I’m probably just as impressed with someone getting the Ph.D. in Education as I am with a Ph.D. in Civil Engineering or Construction Management.” But another department head felt that an individual with a Ph.D. in Construction or Civil Engineering would be in high demand. And yet another


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

department head stated that faculty should have a Ph.D. but it “should be in Education, Business, Engineering, or Architecture.” A total of 71.1% of the faculty teaching in ACCE accredited CM programs who responded to the survey agree or strongly agree with the statement: “The department at the institution in which I teach prefers to have faculty with a doctoral degree.” The results of the survey responses to these two statements are shown in Table 1. Table 1. The Department in which I teach prefers faculty with a doctoral degree Response Option Frequency Valid Percent Strongly Disagree 3 3.3 Disagree 12 13.3 Neither Agree nor Disagree 11 12.2 Agree 21 23.3 Strongly Agree 43 47.8 Total 90 100.0 A total of 70.9% respondents agreed or strongly agreed with the statement: “Other construction education programs in the United States prefer to have faculty with a doctoral degree.” These results are presented in Table 2. This is not consistent with the response to another question about a doctoral degree being a requirement for faculty members. Participants were asked to respond to the statement, “A qualification to teach in a construction education program should be a doctoral degree.” A total of 52.3% disagreed or strongly disagreed compared to 27.9% who agreed or strongly agreed as shown in Table 3. Table 2. Other CM programs in the U.S. prefer faculty with a doctoral degree Response Option Frequency Valid Percent Strongly Disagree 0 0.0 Disagree 7 8.9 Neither Agree nor Disagree 16 20.3 Agree 42 53.2 Strongly Agree 14 17.7 Total 79 100.0 Table 3. A qualification to teach in a CM program should be a doctoral degree Response Option Frequency Valid Percent Strongly Disagree 14 16.3 Disagree 31 36.0 Neither Agree nor Disagree 17 19.8 Agree 18 20.9 Strongly Agree 6 7.0 Total 86 100.0


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

Even though faculty members may not agree with the requirement for faculty to have a doctoral degree, 100% of the advertisements for 38 CM faculty positions, posted by 32 programs through the ASC, preferred or required the candidate to have a doctoral degree. There were 23 (60.5%) of the advertisements that required the candidate to have a doctoral degree, and 15 (39.5%) of the advertisements preferred that the candidate have a doctoral degree. The fact that 100% of these advertisements preferred or required the candidate to have a doctoral degree is very indicative of the university requirements being passed on to the CM departments and this was emphasized by one department head who stated, “We look for teaching ability, we look for some relevant experience, and unfortunately our [university] president and our provost look for a Ph.D. in the end.” One of the faculty qualifications that is desired but has become harder to find in candidates for faculty positions is experience in the construction industry. Experience in the Construction Industry There were 13 comments made during the interviews with the six CM department heads that focused on the requirement for faculty members to have experience in the construction industry. And six of the comments reflected the opinion that the candidate should have at least 5 years of industry experience. The importance of industry experience was emphasized when one department head stated, “The bottom line is we’ll hire somebody with a master’s level who’s got experience before we’ll hire a Ph.D. without experience.” Another department head felt that industry experience could come after employment in the CM department stating that the experience could be consulting on a part-time basis “as opposed to full time employment.” This department head also stated that maintaining “current relations with industry is as important as having had previous experience in industry.” Only 9.1% of the faculty teaching in ACCE accredited programs who responded to the survey disagreed or strongly disagree with the statement: “The department at the institution in which I teach prefers to have faculty with construction industry experience.” The results of the responses to this statement are shown in Table 4. These results indicate that 85.3% of faculty responding to the survey agree or strongly agree that the department in which they are teaching prefer faculty with construction experience. This is similar to the opinions that these faculty members had about the industry experience requirements at other construction education programs. Only 3.8% of the respondents disagreed or strong disagreed with the statement: “Other construction education programs in the United States prefer to have faculty with construction industry experience.” The results of the responses to this statement are provided in Table 5. Table 4. The department in which I teach prefers faculty with industry experience Response Option Frequency Valid Percent Strongly Disagree 5 5.7 Disagree 3 3.4


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Neither Agree nor Disagree Agree Strongly Agree Total

5 29 46 88

5.7 33.0 52.3 100.0

Table 5. Other CM programs in the U.S. want faculty with industry experience Response Option Frequency Valid Percent Strongly Disagree 1 1.3 Disagree 2 2.5 Neither Agree nor Disagree 15 18.8 Agree 46 57.5 Strongly Agree 16 20.0 Total 80 100.0 The current CM faculty members responding to the survey overwhelmingly believe that construction education programs want faculty with industry experience. This was confirmed by the document analysis of the advertisements for candidates to fill 38 open faculty positions posted by 32 secondary construction education programs during the 2004 – 2005 school year. Twenty of the open position announcements required or preferred an average of 4.5 years of experience in the construction industry. The majority of the other open position announcements stated that having construction industry experience was a preference but did not specify an amount. Only three advertisements for open faculty positions did not indicate that experience in the construction industry was either required or preferred for the successful candidate. A Good Teacher The need for faculty members with construction experience seemed to translate into another required or preferred quality in a candidate for CM faculty positions. Being a good teacher was very important to CM department heads, surveyed faculty members, and was specified in many of the advertisements for open faculty positions. One of the department heads stated that the qualities of a good teacher include having construction experience, being entertaining, and having energy. This individual also thought that being organized and conscientious are qualities for a good teacher. Another CM department head stated, “I think that first and foremost the person (new faculty member) has to be an educator in terms of a communicative person that can get the content across.” This person also felt that having construction experience helps make an individual a better teacher stating, “Certainly having some experience in the field and real life operations are beneficial to add to the ability to deliver content.” And yet another CM department head stated, “I think that a person, to be a good teacher, has to be interested in teaching, he has to be interested in students, and I think that someone in the classroom – it’s more of their interest than the degree that they would have.” Several of the department heads indicated that having a doctoral degree did not necessarily make a person a better teacher. Although one department head stated:


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

I don’t know that the Ph.D. makes them better faculty, I think it gives them some additional depth and areas of interest. In my case, some of the very things I learned while doing my doctorate have become the basis of my research, my teaching, and some of my consulting work. The need for a new faculty member to be a good teacher was reflected in the responses from existing CM faculty members to the open-ended question: What is (are) your long term goals as a faculty member teaching in a construction education program? Twenty-three faculty members responded that their long term goals were to improve teaching and learning. One faculty member stated, “I think primarily it would be to continue improving the classes to the point that they always reflect real industry experiences to the extent possible for the students.” This attitude was aligned with 16 comments made by faculty focused on the goal of improving graduates. This same faculty member went on that say, “Anything I can do to help the students hit the ground running would satisfy me.” And another faculty member stated a personal goal was, “to produce graduates capable of serving both the [construction] industry and the academia efficiently.” This was echoed by another faculty member who stated he/she wanted to “focus on developing students as constructors as well as leaders for the industry.” And yet another faculty member stated a personal goal was to “help students grow in their learning abilities especially in preparation for Construction Management.” One faculty member summarized the goals of several other faculty members stating that his/her goal was to “produce quality graduates.” The document analysis of the advertisements for 38 CM faculty positions indicated that teaching ability and teaching experience was a requirement for candidates for a majority of the open positions (20 out of 32 advertisements). One advertisement stated that the candidate “must demonstrate a strong commitment to excellence in teaching, advising students, [and] scholarly activity.” Another advertisement stated, “The candidate will have exceptional promise in both undergraduate and graduate teaching and research mentorship.” Some of the advertisements required the candidate to have skill sets consistent with course content as evidenced by one advertisement that wanted the candidate to have “demonstrated excellence in project scheduling, estimating, and cost management.” Another advertisement stated that the preferred qualifications for the candidate “include: previous teaching and work experience in the areas of construction methods, construction management, contract documents, concrete technology, and/or mechanical and electrical systems.” The requirement for a combination of teaching experience and experience in the construction industry was also a common theme that emerged from the document analysis. One advertisement stated that the program preferred the candidate to have “a combination of teaching at the university level and a minimum of five years of recent relevant industry experience at the project management level.” A Good Researcher


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Another theme that emerged from the interviews with CM department heads, from faculty responses to open-ended questions, and the document analysis was that candidates for open faculty positions should be good researchers. Several of the department heads referred to the relationship between a faculty member having a doctoral degree and the ability to do research. One department head stated: A true professor is creating new knowledge, and you can create new knowledge in teaching or you create new knowledge in research. And if you want to transfer that new knowledge to students, other professors, to industry, you’ve got to write. This individual went on to make the connection between having a doctoral degree and doing research stating: The doctoral degree means that you probably did a dissertation, you had to do research to get the dissertation, and if you did research and the dissertation, you had to demonstrate that you created some new knowledge that’s exclusively yours. So that means that if you have a Ph.D. you probably understand the art of doing research, the science of doing research. Another department head stated the existing faculty members want new faculty members to help with research. The need to do research and publish was reflected in the responses from existing CM faculty members to the open-ended question: What is (are) your long term goals as a faculty member teaching in a construction education program? Twenty faculty members responded that their long term goals were to do research and/or publish. Several of the responses indicated specifically the research agendas that these faculty members want to pursue. One respondent stated, “I will be completing a Ph.D. in Education Technology and will continue to publish and present papers related to construction management and educational type research.” And another respondent stated that he/she wants to “publish articles [and] publish a textbook.” Some respondents were less specific such as the response from one faculty member who stated his/her goal was “to develop a strong research agenda.” The document analysis of the advertisements for 38 CM faculty positions indicates that research ability is a preferred qualification for candidates for 10 out 0f the 32 advertisements for open positions. One advertisement stated that the candidate must “develop an agenda in construction research.” Another advertisement stated that the candidate must have “demonstrated research and scholarly achievements.” The need for funding to support research was specified by the advertisement that stated, “Candidates are expected to secure research funding and are expected to compliment and diversify current research.” Another advertisement wanted the candidate to have the “ability to conduct research and scholarly activities.” Professional Registration or Certification


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

One of the preferred qualifications for a candidate for an open faculty position specified in 12 of the 38 advertisements was that of professional registration or certification. One of the advertisements specifically stated, “The successful candidate must possess, or obtain within 5 years, registration as a Professional Engineer or a Certified Professional Constructor.” Another advertisement stated that the candidate must be “licensed as Architect, Professional Engineer, or Certified Professional Constructor within two years of employment as a condition of continued employment.” And another advertisement stated that the candidate must obtain “registration as a Certified Professional Constructor or Professional Engineer within one year from the date of employment.” The requirement for professional registration or certification was not mentioned in the interviews with CM department heads or in survey responses by existing CM faculty. The interviews indicated that not all searches for candidates to fill open faculty positions were successful. The department heads indicated that the teaching responsibilities had to be fulfilled in other ways, primarily using adjunct professors. These adjuncts are most often constructors still working in the construction industry. CONCLUSION For individuals filling open construction education faculty positions there are five qualification criteria that emerge from the data. The two primary qualifications are a doctoral degree and experience in the construction industry. The majority of existing construction education faculty want new faculty to have construction experience to bring into the classroom. This provides many opportunities for constructors who wish to seek a stimulating second career teaching in a postsecondary construction education program. REFERENCES Bogdan, R. C., & Biklen, S. K. (2003). Qualitative research for education: An introduction to theory and methods (4th ed.). Boston, MA: Allyn and Bacon. Creswell, J. W. (1998). Qualitative inquiry and research design: Choosing among five traditions. Thousand Oaks, CA: Sage Publications. Merriam, S. B. (Ed.). (2002). Qualitative research in practice: Examples for discussion and analysis. San Francisco, CA: Jossey-Bass. Tashakkori, A., & Teddlie, C. (Eds.). (2003). Handbook of mixed methods in social & behavioral research. Thousand Oaks, CA: Sage Publications.

David E. Gunderson is an Associate Professor in the School of Architecture and Construction Management at Washington State University. He received his B.S. in Construction Management from Colorado State University and his M.S. through the Engineering, Science, and Project Management programs in the School of Engineering


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1

at University of Alaska Anchorage. His Ph.D. was conferred at Colorado State University in Education and Human Resource Studies with an interdisciplinary focus of construction management and construction management education. Dr. Gunderson has been teaching full time in construction education since 2003 and brings more than 30 years of construction industry experience into the classroom. He was awarded the 2005 National Teaching Award from the Associated Schools of Construction. Gene W. Gloeckner is an associate professor in the School of Education at Colorado State University and the Director of the Center for Teaching and Learning at a Distance. He received his B.S. and Ph.D. from The Ohio State University and his M.S. from Colorado State University. He teaches research design and dissertation proposal development. His publication focus is in the area of research methodology. He has published a dozen books and over 40 articles. This is his 30th year of teaching in higher education.


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An Analysis of Project Delivery Systems in Commercial Construction Ifte Choudhury and Manasi S. Pitkar ABSTRACT This paper seeks to analyze the effects of Design-Build, Construction Management at Risk, and Design-Bid-Build project delivery systems on unit cost, cost overrun, time overrun, profit, and quality, in commercial construction projects. A standard Likert scale style survey was used to gather the data related to these factors, in commercial construction projects. This survey was sent to Project Managers in 190 commercial construction firms in the United States, out of which 40 did not reach their destination and 45 survey responses were completed and returned. The data was used to analyze, unit cost, cost overrun, time overrun, profit, and quality. The data was analyzed by administering probit regression analysis. The results indicated that Design-Build project delivery system is the most appropriate delivery system to achieve a higher degree of quality and profitability in commercial construction projects as compared to Construction Management at Risk and Design-Bid-Build delivery systems. Key Words Construction Management at Risk, Commercial Construction, Design-Build, Design-Bid-Build. STATEMENT OF THE PROBLEM Introduction Throughout the United States, governments, private sector owners, and private producers are experimenting with different project delivery methods, with changes to capital programming procedures, and with new approaches to condition assessment and cost reporting. Early in a project, a client must select a process for design and construction. The process will affect the financing, the selection of the project team, the schedule, and the cost. After the process of pre-project planning, the owner has to decide on the type of project delivery system for successful execution of the project. An owner thus selects a project delivery system best suited for the project. The criteria for the selection of any project delivery system are based on a series of factors. Thus the owner selects factors, which are in alignment with his/her project objective. The selection of these factors is based on careful revision of the


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1

Owner-Contractor work structure. The various project delivery systems are also known as procurement methods. There is no perfect project delivery method for every individual building project. Also, there are no absolutes in project delivery methods. Delivering a building project on time and within budget is still an increasingly complex matter. A host of new project delivery methods and management techniques have been promoted to help achieve these goals. Developing a project delivery strategy is a particularly complex task that requires diverse and highly sophisticated skills, relevant expertise, and specialized knowledge. Construction Industry in the United States accounts for approximately 10% of the gross domestic product (Nunnally, 2007). Thus even a small improvement in efficiency of the industry may bring about a significant increase in profitability to the sector. It has also been observed that the selection of an appropriate contracting method can decrease cost of the project by about 5% (Gordon, 1994). Selection of appropriate delivery system can contribute significantly to the success of a project. Therefore the factors considered for the selection play an important role in determining the success of the project. In the past, construction companies and public owners resorted to DesignBid-Build and Construction Management at Risk as the major systems of delivery; but recent trends, particularly among public owners, have shown increased use of Design-Build delivery system. It is necessary to understand what factors are essential for any project for the successful execution of a project. Factors considered in the selection keep on changing with changing environment, uncertainties, and demands. The purpose of this study is to analyze the effects of Construction Management at Risk, Design-Build and Design-Bid-Build project delivery systems on unit cost (cost per square foot), cost overrun, time overrun, profit, and quality, in commercial construction projects. More specifically, the study was designed to find out whether Design-Build delivery method has significant advantages over the other methods in terms of cost, time, profit, and quality. Research Hypotheses 1. The unit cost (cost per square foot) of construction of commercial construction projects delivered using Design-Build delivery system is significantly less than that for the commercial construction projects delivered using Construction Management at Risk and Design-Bid-Build project delivery systems.


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2. The quantity of cost overrun for commercial construction projects delivered using Design-Build delivery system is significantly less than that for the commercial construction projects delivered using Construction Management at Risk and Design-Bid-Build project delivery systems. 3. The amount of time overrun for commercial construction projects delivered using Design-Build delivery system is significantly less than that for the commercial construction projects delivered using Construction Management at Risk and Design-Bid-Build project delivery systems. 4. The degree of profitability of commercial construction projects delivered using Design-Build delivery system is significantly higher than that for the commercial construction projects delivered using Construction Management at Risk and Design-Bid-Build project delivery systems. 5. The quality of construction of commercial construction projects delivered using Design-Build delivery system is significantly better than that for the commercial construction projects delivered using Construction Management at Risk and Design-Bid-Build project delivery systems. Definitions Construction Management at Risk: is a method where the construction manager serves as the general contractor providing pre-construction and construction services. The Construction Manager at Risk provides design phase consultation in evaluating costs, schedule, implications of alternative design systems and materials during design and serves as a single point of responsibility contracting directly with the subcontractors during construction (Texas Society of Architects, 1998). Design-Build: is a method where a single entity is contracted to provide both design and construction. The Design/Build team consists of contractor, architect and engineer. The Design/Builder contracts directly with the subcontractors and is responsible for delivery of the project. Selection is based on the proposal offering the best value to the Owner (Texas Society of Architects, 1998). Design-Bid-Build: is the traditional Project delivery system in the U.S. construction industry where the owner contracts separately with a designer and the contractor. The owner normally contracts with a design company to provide â&#x20AC;&#x153;completeâ&#x20AC;? design documents. The owner or the agent then usually solicits fixed price bids firm construction contractors to perform the work. One contractor is usually selected and enters into an agreement with the owner to construct a facility in accordance with the plans and specifications (Sanvido et al.,1997). Review of literature


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Delivering a building project on time and under budget is still an increasingly complex business. A host of new project delivery methods and management techniques have been promoted to help achieve this (Molenaar et al., 2004; Jaafari, 1997; Newcombe, 1996). Choosing and tailoring the right project delivery method to the needs of the customer is a crucial task in the early stage of any construction project (Ling et al., 2004; Groton and Smith, 1998). The decision that has a significant effect on the risk allocations of a construction project is the choice of project delivery method. Each of the participants in any project delivery system incurs some kind of risk at different levels. Since different project delivery systems organize the building process differently, they cannot be adopted indiscriminately on all types of projects. There is no perfect project delivery method for every building project. The best method should be chosen after careful evaluation of the needs of the customer, project characteristics, along with the project team memberâ&#x20AC;&#x2122;s qualifications and experiences. Construction Management at Risk, Design-Build, and Design-Bid-Build are the three principal project delivery systems used in the United States today (Konchar and Sanvido, 1998). We are living in an age of increasing complexity in all endeavors including construction. The revolution in communications, a decline in the number of available skilled tradespersons, and changing management styles have made construction more challenging than ever. In the face of constant challenges, the ever-resilient construction industry has learned many ways to address the complexities of getting buildings built through various, newly emerging project delivery systems (Dorsey, 1997). The trend in the use of project delivery system is changing rapidly. Project delivery system has evolved over the years. The medieval master builder was hired by an owner to design, engineer, and construct an entire facility. This system was common until the early 20th century. With changing technologies it was necessary to change the type of delivery system, which gave way to the Design-Bid-Build. As the specialization of services increased, it was found that the interaction during design phase was extremely poor which resulted in inefficient designs, increased errors and disputes, higher costs, and ultimately longer schedule. This led to the Construction manager delivery system to improve the interaction and to overlap the design and the construction phases. This led to decreased in-house project management manpower, and costly disputes. Thus it was found necessary for owners to resort to single source Design-Build contracting (Konchar, 1998) There is an increasing trend toward the use of the Design-Build procurement method in the public sector (Tulacz, 2006; Yakowenko, 2004). Although it was initially thought that Design-Build was best suited for simple projects, studies have shown that it is equally effective on projects involving complex design issues (Molenaar et al., 2004; Songer & Molenaar, 1996 and


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1997). Eller & Uhlik (1999) projects that 80 per cent of all projects would be delivered using Design-Build by the end of this decade. METHODOLOGY Data Collection Procedure A web-based instrument was prepared using HTML and ASP format. It contained the survey questions and text blocks, where the responses could be recorded. There was a submit button at the bottom of the page. On clicking the submit button, the responses were directed and stored in the database. This database was accessible for viewing but could not be edited. This mode of survey was more economical and convenient than the usual mode of sending the survey questionnaire by mail. The instrument was designed to collect data related to methods of project delivery, actual project cost, actual construction time, cost overrun, time overrun, margins of profit, and quality of works of commercial construction projects. The instrument was emailed to the Chief Executive Officers of 190 construction companies, randomly selected from Texas A&M University’s Department of Construction Science Career Fair database. The email contained a brief about the study and a link to a survey web page. Out of 190 emails, 40 did not reach their destination, and 45 completed responses were received. The response rate, considering only the emails that reached the destination, was 30 percent. Of the 45 responses, 20 were for design-build, 17 for construction management at risk and 8 for design-bid-build. Each survey was thoroughly reviewed to ensure that the data was entered completely. Variables and their Operationalization Delivery (DELIVERY): It is the type of project delivery system used for delivering the project. This was a class variable consisting of three categories: (1) Construction Management at Risk, (2) Design-Build (DB), and (3) Design-BidBuild (DBB). Unit Cost (UNITCOST): It is the actual project cost in US dollars per square feet of a project. The variable was operationalized by dividing actual total construction cost by the total constructed area of a project. Cost Overrun (COVER): It is the reported cost of a construction project in addition to the estimated cost of the project. It was operationalized using “0” for every “No” and “1” for every “Yes” reported for every construction project. Time Overrun (TOVER): It is the reported time required to complete a construction project in addition to the estimated construction time of the project. It


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) – April 2007, Volume 31. Number 1

was operationalized using “0” for every “No” and “1” for every “Yes” reported for every construction project. Profit (PROFIT): It is the reported profit on a construction project and was operationalized using a single-item measure on a five-point Likert scale. Quality (QUALITY): It is the degree of actual and perceived excellence of a construction project. It was operationalized using a summary index of the three items related to actual and perceived quality of construction. Two of the quality items were measured on a five-point Likert scale and one was measured on a three-point Likert-like scale. ANALYSIS AND RESULTS Analysis The hypotheses were tested using a General Linear Model. It is an extension of linear regression model that allows analyzing the effects of class variables on the criterion variables. The following models were used for the analysis, using DELIVERY as the response variable: UNITCOST = β 0 + β 1 DELIVERY + ξ COVER = β 0 + β 1 DELIVERY + ξ TOVER = β 0 + β 1 DELIVERY + ξ

Eqn. (1) Eqn. (2) Eqn. (3)

PROFIT = β 0 + β 1 DELIVERY + ξ Eqn. (4) QUALITY = β 0 + β 1 DELIVERY + ξ

Eqn. (5)

where β 0 = intercept, β 1 = regression coefficient, and ξ = error term in the equation.

Results The results of the analyses are shown in Tables 1, 2, 3, 4 and 5. Table 1. Summary of General Linear Model analysis for DELIVERY using UNITCOST as a dependent variable Parameter

Regression Coefficient

t-statistic t-value

p-value

Intercept

84.84

79.84

1.06

CM

42.83

96.83

0.44

DB

145.73

94.47

1.54

R

2

0.070

F-statistic F-value

p-value

1.58

0.22


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0

Table 2. Summary of General Linear Model analysis for DELIVERY using COVER as a dependent variable Parameter

Regression Coefficient

t-statistic t-value

p-value

Intercept

0.25

0.16

1.60

CM

0.04

0.19

0.23

DB

-0.05

0.19

-0.27

DBB

0

R

2

0.01

F-statistic F-value

p-value

0.21

0.81

Table 3. Summary of General Linear Model analysis for DELIVERY using TOVER as a dependent variable Parameter

Regression Coefficient

t-statistic t-value

p-value

Intercept

0.13

0.99

0.33

CM

0.17

1.10

0.28

DB

-0.08

0.15

-0.50

DBB

0

R

2

0.09

F-statistic F-value

p-value

2.18

0.12

Table 4. Summary of General Linear Model analysis for DELIVERY using PROFIT as a dependent variable Parameter

Regression Coefficient

t-statistic t-value

p-value

Intercept

2.50

8.87

<0.0001

CM

0.56

1.63

0.11

DB

1.25

0.33

3.75

R

2

0.27

F-statistic F-value

p-value

7.95

0.001


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Table 5. Summary of General Linear Model analysis for DELIVERY using QUALITY as a dependent variable Parameter

Regression Coefficient

t-statistic

R

t-value

p-value

Intercept

11.00

17.03

<0.0001

CM

-0.41

0.78

-0.53

DB

2.00

2.62

0.12

DBB

0

2

F-statistic

0.30

F-value

p-value

8.79

0.0006

The results indicate that F-values for models (4) and (5) only are significant at the level of 0.001 and 0.0006 respectively. This provides evidence that a relationship exists between DELIVERY and PROFIT, and between DELIVERY and QUALITY. None of the other criterion variables were found to have any effect on the project delivery systems. Least Squares Means option of General Linear Model was used to find out the directions of the differences in profitability and quality among the three project delivery systems. The analysis shows how significant is the pair-wise difference in means of the variables. The results are shown in Tables 6. Table 6. The p-values for pair-wise difference in PROFIT and QUALITY Mean

p-values

Variable CM

DB

DBB

CM vs. DB

CM vs. DBB

DB vs. DBB

PROFIT

3.06

3.75

2.50

0.0119

0.1095

0.0005

QUALITY

10.56

13.00

11.00

0.0002

0.6018

0.0123

The results indicate that profitability and quality of commercial constructions projects using Design-Build method are significantly higher than those for using either Construction Management at Risk (p = 0.0002 for PROFIT and p = 0.0119 for QUALITY) or Design-Bid-Build (p = 0.0005 for PROFIT and p = 0.0123 for QUALITY) methods. CONCLUSIONS


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1

The results of the study indicated a statistically significant difference both in the level of profit and quality of construction between commercial construction projects delivered using Design-Build and other methods of delivery, such as Construction Management at Risk and Design-Bid-Build. However, no significant difference was found in cost overrun, time overrun, and unit cost of construction for commercial projects using different methods of delivery. Both profit and quality of construction were higher for projects using Design-Build method than for those using other methods of delivery. This is probably because Design-Build method is capable of solving issues that result from separation of design and construction professionals in other methods of delivery. Errors and omissions in the construction documents are less likely to occur under such delivery method. Other studies carried out in the recent past establish that projects administered using Design-Build project delivery system can achieve significantly improved cost and schedule advantages, but none of the studies have focused on the findings for Design-Build as far as the issues of quality and profitability are concerned, which are important from the contractorsâ&#x20AC;&#x2122; point of view. The findings will be useful for all parties associated with the construction industry who have a role in the selection of project delivery methods. It clearly indicates how a delivery system affects profit and quality issues of construction in the commercial sector and helps both the professionals and the owner select a delivery system in line with the objectives of the project, early during its conception. The study will also, hopefully, generate enough interest to conduct further research for deriving models and strategies for selection of suitable delivery methods for other types of construction. REFERENCES Dorsey, Robert. (1997). Project delivery systems for building construction. Washington, D.C.: Associated General Contractors of America. Eller, M.D. & Uhlik, F.T. (1999). Alternative delivery approaches for military medical construction Projects. Journal of Architectural Engineering, 5 (4), 149 155. Gordon, C. M. (1994). Choosing appropriate construction contracting method. Journal of Construction Engineering and Management, ASCE, 120 (1), 196-210. Groton, J.P. and Smith G.A. (1998). Weighing the options. Journal of Management in Engineering, ASCE, 69-72. Jaafari, A. (1997). Concurrent construction and life cycle project management. Journal of Construction Engineering and Management, ASCE, 123 (4), 427 435.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1

Konchar, M. & Sanvido, V. (1998). Comparison of U.S project delivery systems. Journal of Construction Engineering and Management, 128 (6), 435 - 444. Ling, F. Y. Y., Chan, S. W., & Ee, L. P. (2004). Predicting performance of designbuild and design-bid-build projects. Journal of Management in Engineering, ASCE, 130 (1), 75 - 83. Molenaar, K. R., Bogus, S. M., & Priestley, J. M. (2004). Design/build for water/wastewater facilities: State of the industry survey and three case studies. Journal of Management Engineering, 20 (1), 16 - 24. Tulacz, G. J. (2006). Design-build continues to grow despite price concerns. ENR: Engineering News-Record, 246 (23), 38 - 39. Newcombe, R. (1996). Empowering the construction project team. International Journal of Project Management, 14 (2), 75 - 80. Nunnally, S. W. (2007). Construction methods and management. NJ: PrenticeHall. Texas Society of Architects (1998). Project Delivery for Texas Public Schools. Austin, Texas. Songer, A. & Molenaar, K. (1996). Selecting design-build: Public and private sector owner attitudes. Journal of Management in Engineering, ASCE, 12 (6), 47 - 53. Songer, Anthony and Molenaar, Keith.(1997). Project Characteristics for successful public-sector design-build. Journal of Construction Engineering and Management, Vol. 123, No.1, 34-40. Yakowenko, Gerald (2004). Megaproject procurement: Breaking from tradition. Public Roads, July/August, 48 - 53.

Ifte Choudhury is an Associate Professor in the Department of Construction Science at Texas A&M University. Dr. Choudhury has extensive experience as a consulting architect working on projects funded by the World Bank. His areas of emphasis include housing, alternative technology, issues related to construction education, construction management, and international construction. He is also a Fulbright scholar. Mansi S. Pitkar is an architect and a constructor. She graduated from Texas A&M University with a masterâ&#x20AC;&#x2122;s degree in construction management. Ms. Pitkar now works for a renowned construction company in the United States.


The American Professional Constructor, The Journal of the American Institute of Constructors (AIC) â&#x20AC;&#x201C; April 2007, Volume 31. Number 1


The American Professional Constructor April 2007, Volume 31 Number 1  

The Professional Constructor is a refereed journal published two times a year by the American Institute of Constructors (AIC). The AIC's mi...

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