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Relational Teams Turning the Cost of Waste Into Sustainable Benefits

  • Branka V. OlsonEmail author
  • Edward R. Straub
  • William Paolillo
  • Paul A. Becks
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Abstract

Conventional building processes, which still dominate the industry, take too long, cost too much, and often disregard their social and environmental impacts. Over the past 50 years, while most industries have doubled or tripled productivity, the commercial building sector has experienced negative productivity growth. In order to mitigate these practice outcomes, the industry must transform from a transactional to a relational team structure that is people-centered. An integrated project model that is grounded in relational contracting, climate, and context can significantly improve building project outcomes that benefit the three Ps of engaged sustainability – people, planet, and profit. The relational project environment is built on a foundation of shared vision, values, and the basis for a common vernacular that guides human activity and generates human bonds. This chapter defines the three relational states and translates them into actionable steps with which to positively affect a building project team structure. The integrated project delivery framework lays the groundwork for a building project success model. However, the key to its realization is the level of flexible cohesion exhibited by the project team members. The collective levels of flexible cohesion determine the team’s ability to create and maintain a relational project environment without which project success would be greatly diminished. The individuals’ flexible cohesion potential is driven by their attitudinal and behavioral characteristics. In other words, processes alone do not deliver projects; it requires a team of engaged people.

Keywords

Project teams Relational contracting Relational climate Relational context Flexible cohesion 

Introduction

Traditional management theories, many of which are still taught in business schools around the world, were developed in the late nineteenth and early twentieth centuries during the second industrial revolution. Organizations needed consistent, repeatable management methods during this explosion in mass production. In many industries, these concepts have endured with few changes. Although these methods were originally designed for industrial manufacturing, they have permeated many fields using scientific management as a basis to systematize entire segments of the economy. This approach required minimizing the impact of the human variable from the process. However, this dehumanizing effect was detrimental on performance levels as the nature of work began to change. The accelerated rate of change and the increased volume of information, that had to be processed added complexity to everyday decision-making. Work required information and knowledge workers supported by increasingly faster computing power and the Internet. Known as the third or digital revolution, it replaced mechanical tools with smart devices enabling both mobility and autonomy of workers. As a result, management researchers included variables such as worker engagement, motivation, and innovation into their study models (Crawford et al. 2010; Janssen 2005; Ramlall 2004). Academic and practitioner literature began to indicate that industries that fail to adapt to modern management and project delivery practices are at a competitive disadvantage. This led to the realization that industries that are able to capitalize on the flexibility, creativity, and passion of their workers are better positioned to succeed. In the advent of the fourth industrial revolution, as task-based work is being transitioned to automation and robotics, the role of the human worker as a relational being is ever more critical (Schwab 2017). The realization that we are currently living in the Anthropocene or Human Age, where humans control all life-sustaining systems on earth, is a daunting responsibility (Steffen et al. 2007). To advance our existence, we must employ an integrated and flexible structure to decision-making that is inclusive of all stakeholders and relational in its approach.

This phenomenon is even more relevant in the building industry. In many ways, the framework by which buildings are designed and constructed has not changed for centuries. It is historically a linear process with many points of handoff from one discipline and trade to the next. This often leads to gaps in coordination, redundancy in effort, rework, and costly overruns. The result is a confrontational and often litigious work environment. In order to realize sustained value, a different approach that results in an engaged, considered participation of all stakeholders throughout the design and delivery process of the building project is necessary. It is important to understand that processes do not deliver projects; people, working together in an interactive, cooperative context, deliver projects.

For instance, traditional construction methods typically only involve building users at two points in the process. They are involved during requirement development at the very beginning of the project, and at occupancy, near the very end of the project (Paolillo et al. 2016). The process is linear, product-focused, and transaction-oriented. Contracts are used to ensure the delivery of a building that meets specifications agreed to before the first shovel is ever turned. Value during the process is defined from the short-term perspectives of project schedule and budget. To the extent that recyclable materials, environmentally sensitive features, and efficient systems were specified during the design process, the project may achieve a sustainable building rating. Although a commendable achievement, this constitutes sustainability with a small “s.” Small “s” sustainability is a focus on environmental factors that result in short-term benefits with the objective of “doing less harm.” This type of sustainability is typically perceived as an added initial cost to the client intended to conserve natural resources and reduce waste. It may also include objectives to renew and recycle materials or to preserve endangered species of materials.

The results of utilizing traditional delivery methods for the commercial construction industry over the last half century have included adversarial relationships, declining productivity (−10%), and over half of all projects over budget or behind schedule (Construction 2013). This is in addition to the poor environmental track record of the industry and commercial buildings currently in use. Traditional methods are not sustainable because they fail to acknowledge the human social systems that deliver projects and the complex human systems in which final built spaces exist and are utilized.

The primary reason for this apparent failure of the building industry is the narrow and short-term perspective of how projects are defined and implemented. The involvement of the project team is perceived as temporal and finite. The metrics and values assigned to the project are typically limited to project delivery. The project has a beginning, middle, and end, with a 2- to 5-year duration. In that context, sustainability is factored in terms of building features, systems, and materials and translated into initial cost impacts. A large-scale commercial office project is often assessed upward of 25% to achieve a high LEED (Leadership in Energy and Environmental Design) rating. This curtailed view of the building project limits the industry’s ability to consider the effects on the life-cycle impacts of the human, social, ecological, and economic sustainability.

Buildings have a significant impact on their owners, occupants, users, and the surrounding community. The design and delivery process implemented by stakeholders who have diverse experience, socioeconomic status, education, and desired outcomes is complex. Human social systems in general are complex systems (Ball 2012) characterized by their emergent outcomes, the self-organizing nature of their participants, and the collective intelligence greater than the sum of the individuals that make it up (Mitchell 2009). This requires an interactive project delivery process that “integrates people, systems, business structures and practices, and processes that collaboratively harnesses the talents and insights of all participants to optimize project results” (URL: American Institute of Architects, Integrated Project Delivery: A Guide 2007). Acknowledging the objective of this integrated delivery process and taking steps to enable greater cooperation for improved outcomes are the key not only to an improved efficiency in delivering construction projects but also to delivering sustainable buildings integrated with the surrounding community consistent with the long-term objectives of all stakeholders. This approach can deliver life-cycle sustainability with a capital “S” that balances the three bottom line principles of sustainability – people, planet, and profit. We call this a relational team approach based in mindful, participatory, and inclusive behavior. This approach is motivated by shared vision and values across multilevel project structures and is enabled by a common vernacular across disciplines (Olson 2016).

This broader understanding of sustainability in the context of building projects results in a complex system. Managing this complexity becomes a key element of the relational project dynamics, which is defined as consisting of many varied interrelated parts that are activated through differentiation and interdependency. Differentiation can be vertical, such as a hierarchy, and horizontal, reflected in the number of components and number of tasks. Interdependency is represented by the degree of reciprocal interaction between the components. Managing project complexity requires integration through coordination, communication, and control (Baccarini 1996).

Holling (2001, p. 391) states that “complexity of living systems of people and nature emerges not from a random association of a large number of interacting factors but rather from a small number of controlling processes.” Using a small set of processes, complex systems can self-organize into complex adaptive systems. This continuous evolving process defines the meaning of “sustainable development” (Gunderson 2001). In this context, sustainability is defined as the ability to create, test, and maintain adaptive capability, while development is the method of creating, testing, and maintaining opportunity (Holling 2001). Together, these two concepts suggest the intention of inducing flexible adaption and promoting integrated benefits for the project delivery team, as well as the social, ecological, and economic factors surrounding the building industry.

Relational Team Approach

Inattention to social systems in organizations has led researchers to underestimate the importance of culture-shared norms, values, and assumptions in how organizations function. (Edgar Schein 1996, p. 229)

To understand how people responsible for delivering construction projects perceive their world, we must understand the internal context in which they work. Construction project delivery practitioners have relied on the same unquestioned assumptions and metaphors to conceptualize business models and best practices with little improvement for decades. Traditionally, contracts are established to strictly enforce agreements and navigate the principal-agent problem. They are very transactional. Relational teams do not forsake contracts, but the methods for developing them and the demands of each party throughout the duration of the contract are different. “[T]eam cohesion” developed during the project definition phase “creates a relational climate of trust that is codified in the contractual requirements” (Paolillo et al. 2016). Contracts that underpin relational teams consider the long-term implications of the project and its outcomes. This type of contracting relationship means the needs of a broad group of stakeholders must be considered.

Work teams are generally composed of members with complementary specialties brought together to perform a task (Salas and Fiore 2004); however, in addition to the architects, engineers, and construction contractors, stakeholders such as space-users and community members should be engaged as part of the work team to deliver sustainable projects. Typically, the community is engaged through the permitting process or a mandated outreach effort which is engagement through compliance. Building users are involved through random surveys or represented by subject matter experts. This compartmentalized approach to building project development often results in predictable solutions based on tried-and-true ideas and archetypal categorizations. Relational project teams recognize that individual team members may not have the holistic understanding of all the ways in which a building project can impact its occupants and surroundings over time. In cohesive project teams, flexible individuals are enabled and empowered to bring integrated, new perspectives to all phases of the project (Weick et al. 2008). It is important to note that team norms and relationships develop with influence from their environment; the environment, in turn, changes as a result of the team norms and the relationships that exist within it (Bandura 1986; Giddens 1984). In other words, relational teams come together, and individuals work in an environment of both top-down constraints and bottom-up individual preferences and norms (Kozlowski and Bell 2012). Inclusion and positive outcomes require engagement from team members. When individuals are engaged, they are typically vigorous, dedicated, and absorbed in their work (Schaufeli et al. 2002, p. 74). A number of studies (e.g., Judge et al. 2001; Ryan and Deci 2000; Sonnentag 2003) have shown that engaged team members can create a virtuous circle in which motivation, dedication, and satisfaction positively feed job performance. Understanding that this dynamic exists and identifying people who can work in this context are a foundational element to the relational approach to project delivery .

An example of such a relational approach to project delivery is a recently completed children’s hospital project in Akron, Ohio. The Akron Children’s Hospital’s (ACH) mission was comprised of three promises: (1) Treat every child as we would our own, (2) Treat everyone the way we would want to be treated, and (3) Never turn a child away (ACH Tower Team 2014: p. 21). The fact that this project was for a children’s hospital facilitated the team’s ability to institutionalize flexible cohesion characteristics; however, the human-centered nature of the approach was at the heart of the project’s ability to deliver successful outcomes. The ACH project team implemented integrated project delivery (IPD) methodology and lean tactics of operation, design, and construction to achieve remarkable results of early delivery, under budget from conventional estimates. These methods have been shown to improve cost, schedule, and performance metrics relative to traditional design-bid-build contracting. In fact, integrated teams and lean intensity projects are three times more likely to complete ahead of schedule and two times more likely to complete under budget (URL: Dodge Data & Analytics, Owner Satisfaction and Project Performance Survey). We posit that the exceptional success demonstrated at ACH was driven by the relational nature enabled by shared vision and values and a common vernacular that manifested in the work team’s flexible cohesion and produced sustainable results (with a big “S”) for people, planet, and profit.

Relational Contracting

A contract enforces agreements between parties in cases of dispute and forms the basis for appeal when the dispute cannot be resolved. In traditional building projects, the owner enters separate contracts with the architect for the design phase and with the contractor for the construction phase. Each of these entities holds subcontracts with a myriad of sub-consultants, vendors, and construction specialists. Figure 1 represents the traditional relationship in construction contracting. These individual contracts all include specific scopes of work, terms and conditions, overhead and profit margins, and contingency allotments. If additional work is needed due to discrepancies in the drawings, unforeseen circumstances, or design modifications, the contracted parties must resolve it through a change order process. These can often be costly and confrontational; furthermore, because there is no contractual relationship between the architect and contractor, the issue becomes the owner’s responsibility to ultimately resolve and pay for.
Fig. 1

Transactional project team relationship

In a relational contract, the parties agree upon general principles and terms of resolution when conflicts arise (Milgrom and Roberts 1992). Projects using an integrated project delivery methodology are executed based upon shared risk and shared reward under a multiparty contract. The usual actors are owner, architect, and contractor, with key sub-consultants and/or subcontractors sometimes included. The contract is executed on a representational basis where the authorized, senior-level person from each entity is the signer. This approach sets up a collaborative rather than adversarial relationship and shifts the emphasis to working in the best interest of the building project rather than individual project entities. Figure 2 represents the collaborative relationship in this type of dynamic. The order of the team members from top to bottom represents the type of role (leadership vs. supporting; action-oriented vs. consultative) that member will generally have in each phase. The involvement of stakeholders such as contractors, community members, and occupants have in the early phases of the project is worth noting. The requirements and design perspective input from these groups will inform decisions that impact areas such as constructability, aesthetics, and physical dimensions and layouts and are important for providing a long-term perspective. Later in the project, continued involvement of the contractor, architect, and consultants not only demonstrates commitment to the community and project but also facilitates ongoing changes or improvements.
Fig. 2

Relational project team relationship

While this provides a foundation for the relationship to minimize the potential for self-interested, opportunistic behavior at the top levels of the signatory organizations, it does not ensure the cooperation and trust among other members of the project team. Thus, a sub-agreement is needed that binds all other team members to the terms and conditions of the relational contract. The key condition that governs all the agreements is commitment to work in the best interests of the project outcome at all times. While the legal contractual ramifications technically only apply to signers of the contract, eliciting verbal agreements from all team members that “we are in this together” can have a powerful motivation and team-building effect. Active participation like this defines the nature of relational contracting. In the case of ACH , the mantra was E3 – Engagement, Everywhere, Everyone (ACH Tower Team 2014).

Responsibility and accountability do not only reside at the top levels of the project team utilizing relational contracting. Shared values must be communicated with and shared across all levels of the project team to be successful. Team members on the ACH project created a relational climate to support the relational contract by establishing a multilevel structure to define and drive project goals concurrently from the top down and the bottom up. The three-level team structure they developed included a senior executive team, a project leadership team, and discipline-based innovation teams. Innovation teams were comprised of subject area experts in their field and dealt with daily problems focused on (1) increasing productivity, (2) creating value, and (3) delivering the project. The project leadership team was empowered to make decisions on all matters in the best interest of the project outcome. Only issues that could not be resolved at the lower levels would be escalated to the senior executive team, which was obligated to resolve all issues prior to moving to a new project phase or subsequent task. In addition to the philosophical motivation prevalent in the project, this arrangement created a practical incentive for senior executives to resolve issues. Likewise, because teams continued interacting over a long period of time, they were incentivized to resolve issues amicably.

The risk and reward system in a relational team structure is grounded in the all for one and one for all mentality. While the direct costs of the project are still the responsibility of the owner, the contingency and profit allotments are pooled and distributed based upon the success level of the project delivery. The aggregated contingency is used by any team member to cover the extraordinary expenses. Any unused amount is added to the profit sum. Conversely, if the additional costs exceed the contingency allocation, the monies to cover the amount come out of the profit sum, not the owner’s pocket. This incentivizes the team to minimize waste, rework, and inefficiency in project implementation, which ultimately benefits all team members.

Relational Climate

Historically, participation for most team members of a building project is typically transactional. Their involvement is for a limited period of time to complete a prescribed task(s) at a set fee. Only a very small number of individuals have bigger picture knowledge of the overall project scope and interaction with the stakeholders. The result is a disconnected and depersonalized level of project member interaction. More recently, a project delivery paradigm shift is occurring in the building industry toward an integrated implementation team approach. This approach points toward shared vision and values, as well as a common vernacular that is defined early and regularly exercised in team members’ daily routines and actions in order to establish and implement common project goals and objectives (Olson 2012). The realization of this integrated approach required a relational team climate .

Social science research indicates that the way in which team members treat and motivate each other is a reflection of their understanding and acceptance of the relational climate in which they find themselves (Mossholder and Richardson 2011). The basis for the manifestation of a relational climate in a group setting has been identified as helping behavior , which has been studied as a predictor of group and organizational performance (Podsakoff et al. 2000). Helping behavior is cooperative and positively affects individuals in groups (Podsakoff et al. 2006; Settoon and Mossholder 2002). Individuals judge the value of their helping behavior based upon the problem and solution effectiveness manifested within the group context.

In order to create a relational climate that fosters this type of behavior, teams must choose their members mindfully and organize the team structure carefully. Fiske’s (1992) relational models theory (Mossholder and Richardson 2011) conceptualized the relational climate types, which Mossholder (2011) equated to human organizational structures as (a) compliance systems , (b) collaboration systems , and (c) commitment systems . To apply these concepts to the project team structures, we characterized the climate types as (a) opportunistic, (b) collaborative, and (c) communal, based upon the descriptives associated with the predictive dimensions revealed in the Mossholder et al. study (2011). The opportunistic category implies a transactional approach that is self-serving. The relationships are temporal based in economic benefits for prescribed contributions (Rousseau 1995). A collaborative climate demands participation and interaction among the team members that is rooted in a mutual exchange of transactional and relational benefits. Collaborative climates typically involved knowledge sharing grounded in the achievement of shared objectives. A high relational team climate is communal . It requires collective commitment and focus toward a higher goal in a long-term context. The goal can be externally motivated, but it also creates bonds among team members with whom the goal is accomplished (Mossholder and Richardson 2011).

The predictive dimensions that influence each relational climate type are (1) motivation for exchanges among the team members, (2) justice norms that determine how exchanges between the team members are assessed, (3) perceived risks that affect the relationships, and (4) a basis for trust between individuals or organizations involved in the project. In a low relational climate or opportunistic team environment, participants will exhibit a low level of interpersonal commitment resulting in limited relational depth. The motivation revolves around the participant’s perception of balance between efforts exerted and benefits received. In this situation, equity is evaluated based upon the relative ration between input and output of each person on the team rather than the absolute amount of contribution to the project. The primary interest is to derive a sufficient return on helping behavior investment. Trust is based upon the calculated risk that the benefits will be equal to the effort invested (Mossholder and Richardson 2011). A medium or collaborative relational climate required shared common interests. The team relationships are based upon common values that are both transactional and relational (Rousseau 2004). The motivations are understood to be temporary during which time the team members are working toward the same goals. The motivation to achieve mutually beneficial shared outcomes explains the need for knowledge sharing. Thus, helping behaviors support an equality-based team environment, which is manifested in common social expectations and reciprocal exchanges (Cropanzano and Mitchell 2005). Team trust is built upon willingness to engage in frequent and ongoing interactions as a relational entity over time, rather than assessing each individual event. A communal relational climate is founded in mutual high regard for team members involved in collective commitment. The team environment fostered lasting relationships between team members motivated by an attainment of mutual goals and appreciation for the team with whom the goals were achieved (Mossholder and Richardson 2011). Helping behavior is a way to exhibit mindfulness toward team members and stakeholders. This vested interest in the well-being of others reinforces the need for fairness and caring in team interactions. This ability to relate and empathize based upon common experience and familiarity leads to identification-based trust (Lewicki et al. 2006). Once identity-based trust is established, helping behavior becomes need-based, collective-directed (Perlow et al. 2004), and difficult to erode (Mossholder and Richardson 2011).

Table 1 illustrates the assessment matrix that can be used to evaluate the potential for partnership building on the part of team members. It provides some typical behaviors associated with these dimensions that can be used to assess the type of climate supporting a project team . A low assessment would be an indicator that the individual or organization is not a good relational fit, the assumption being that an opportunistic disposition would not support the objectives of a relational team approach. Alternatively, simply clarifying differing perspectives of stakeholders or potential team members can serve as a focal point for a dialogue around which a common vernacular can be developed and a shared vision and values can be created. A medium or collaborative assessment of the individual or organization is an indication that team participation is possible on a relational contracting level but with a low level of engagement. If the team agrees that a relational project team is the desired approach, identifying specific areas for improvement or means to facilitate these areas could lead to buy-in and improved flexible cohesion within the team dynamic as the project evolves and roles change over time. An example might be the motivation regarding knowledge sharing: as more knowledge is shared and team members understand better why knowledge was shared at a certain time and how it can best be applied, the environment is established for the convergence of values. A high communal assessment would suggest that the individual or organization is capable of full commitment to the relational climate necessary to deliver the best possible project results. This assessment matrix can be used to forecast the potential for team members’ helping behaviors in a relational team climate. A relational climate indicates shared perceptions of attitudes and behaviors affecting interpersonal relationships in a team structure (Mossholder and Richardson 2011).
Table 1

Team assessment matrix

  

Relational climate types

 
 

Low

Medium

High

Dimensions

Opportunistic

Collaborative

Communal

Motivation

Self-interests

Knowledge sharing

Shared social values

Justice norm

Equity

Equality

Need-based

Perceived risks

Return on investment

Balanced reciprocation

Empathic response

Trust

Calculus-based

Knowledge-based

Identity-based

Source: Adapted from Motivation and Sustenance of Helping Behavior (Mossholder and Richardson 2011)

Enabled by the relational contracting terms and conditions within a relational climate, the project team is motivated to engage in actions that support team success and move the project forward. The ACH stated mission – to provide medical care to infants, children, adolescents, and burn victims of all ages, regardless of ability to pay – triggers an emotional response. However, it is the involvement and commitment of all the stakeholders to continuously focus on the project goals and objectives that create a relational climate. The ACH team utilized LEAN practices in operations, design, and construction to optimize the processes, systems, services, and solutions delivering effective project results. These included continuous and proactive input and participation of all stakeholders to address and solve problems during design and construction of the project. During the design phase, the staff, doctors, and parents of child patients participated in full-scale mock-ups to develop and test treatment and recovery rooms, discovering the most effective layouts. The shared vernacular was built around rewards and benefits. Construction crews acknowledged individuals that proactively undertook tasks which lead to cost and schedule improvements. Waste reduction was celebrated and rewarded.

The ACH team was an example of a communal relationship converging around a shared goal. Team members were fully committed to the values of ACH and its purpose. The project leadership team developed a thorough training program mandatory for every individual at every phase of the project. The senior executive team supported the program, and the innovation teams implemented and improved the program as it was executed. Once trained in the values, vernacular, and vision, each team member went out of their way not only to support the success of the project but also to express heartfelt emotions toward the primary stakeholders, namely, the children. Even though it was easy to empathize with and feel sympathy for the patients of a children’s hospital, it was clear that the relational culture of the project team enabled this expression, which manifested itself in many ways in a stereotypically macho industry.

Practice Exercise #1: Assessing a Team’s Likelihood for Success

A partnering is a framework for structuring and monitoring multiple organizations over the course of a building project that are committed to achieving shared project goals. Partnering promotes open communication and participation among members of project team. The objective is to ensure that team members are working cooperatively throughout the timeframe of project delivery. In order to sustain this cooperative state, the team members must maintain a positive relational climate. Acknowledging that it is people, not processes, that deliver a successful project, it is imperative that the project team relational climate possesses the characteristic nature of a high-performing team. This requires that the team members, at the individual and organizational level, exhibit the qualities across the four dimensions of motivation, justice norm, perceived risks, and trust toward a communal level of a relational climate.

To determine the nature of helping behaviors the team member organizations, as represented by its members, can achieve, an exercise can be integrated into the partnering agenda that assesses the team member relational capability. This would establish the baseline for the standards, policies, and expectations for the project team climate going forward. Deviations from these sets of principles can be red-flagged and mitigated through preestablished channels.

The exercise is comprised of four scenarios that target each of the predictive dimensions of relational climate. The team members are asked to discuss and then respond to the situation in the scenario that reflects their approach and attitude toward the simulated problem that may occur on the project. The predetermined core management team assesses the appropriateness and acceptability of the team and individual responses and assigns them into the low, medium, and high category of relational climate. Team weaknesses are identified, discussed, and resolved. Individuals or organizations that do not exhibit the characteristics necessary to support a high collaborative or communal team are screened out of the project.

Scenario #1: Motivation for Exchange in the Relationship
An unforeseen shortage of material has forced a redesign and changes in field construction. The schedule must still be maintained. This requires a subcontractor scope change and impacts critical path schedule (Table 2 and 3).
Table 2

What is the role of each team member to resolve the situation?

Relational climate

Dimension: motivation

 

Types

Characteristics

Helping behaviors

Opportunistic

Self-interests

If it doesn’t impact my work, I don’t need to be concerned

Collaborative

Knowledge sharing

If all other subs participate, I would be willing to take a look at an alternative solution

Communal

Shared social values

I am sure we have some ideas on how to resolve this quickly

Table 3

How does the team communicate?

Relational climate

Dimension: motivation

 

Types

Characteristics

Helping behaviors

Opportunistic

Self-interests

We can address it at the next schedule project meeting

Collaborative

Knowledge sharing

Maybe the project manager can email us some options for consideration

Communal

Shared social values

We can make ourselves available for an on-site meeting to look at the situation

Scenario #2: Justice Norms by Which Exchange Fairness Is Evaluated
Urgency of schedule is forcing some overlap in time and resources on-site. Access to elevators and cranes will have to be shared (Table 4).
Table 4

How should the subcontractor work be prioritized?

Relational climate

Dimension: justice norm

 

Types

Characteristics

Helping behaviors

Opportunistic

Equity

If my materials are not where I need them, I cannot do my job

Collaborative

Equality

If everybody wants to take turns, I will get in line

Communal

Need based

I can bring up extra materials in one load so I require fewer trips on the elevator

Scenario #3: Risk That Potentially Undermines the Relationship
Urgency of schedule is negatively impacting quality control and coordination. Additional measures must be taken to ensure that work is being done properly and issues resolved quickly (Table 5).
Table 5

What should be the team members’ responsibility in addressing discrepancies and maintaining quality?

Relational climate

Dimension: risk

 

Types

Characteristics

Helping behaviors

Opportunistic

Return on investment

I didn’t do anything wrong so I don’t think I should have to invest my time into resolving the problem

Collaborative

Balanced reciprocation

Everyone should have to share in the blame when something goes wrong

Communal

Empathic response

I will coordinate with the crew behind and ahead of me and raise any concerns as soon as I see a potential problem

Scenario #4 : The Basis of Trust Between Parties
The project manager had to go on medical leave. Another project manager from the same firm stepped in who has a good track record but has not worked on a similar project and never worked with this team (Table 6).
Table 6

What should be the team’s response?

Relational climate

Dimension: trust

 

Types

Characteristics

Helping behaviors

Opportunistic

Calculus based

I don’t know if this person can do the job coming into it in the middle of the project

Collaborative

Knowledge based

It will take time to learn how to work with this person

Communal

Identity based

This person comes from the same background and training and will pick up where we left off

Relational Context

A construction project, depending on size and scale, can have a substantial impact on its surroundings during and for decades after construction is completed. This impact can be a positive or negative experience for its users, community, environment, and planet. More often than not, a building project is constrained to its property boundaries or limited to the input of only a small number of technical disciplines during the critical early phases of decision-making. The regulatory requirements only mandate basic code and zoning compliance during the project design phase. Municipality oversight agencies focus on the safety, accessibility, and use of energy. Environmental impact assessments are often driven by political priorities. A relational project team has the ability to look beyond these minimum standards and first-cost impacts. The benefits of an integrated, relational approach can have far-reaching, long-term benefits with the lowest total cost. This broader view of project delivery occurs in a relational context, which can optimize the environmental, economic, and social value of the built environment over its life cycle (Levitt 2007).

Relational context is a state that supports the creation of perceived value and goodwill for external stakeholders with benefits to the project and the internal stakeholders. It entails the identification, establishment, and maintenance of relationships with parties both internal and external to the project, such that benefits are realized, which can be balanced against the costs to the project and the community. It is widely acknowledged in many industries that the traditional, product-focused approach to delivering value is no longer enough to satisfy consumers (Grönroos 1997). Stakeholders are invested in the sourcing, production, and distribution methods of products as well as their impact on the health, safety, and welfare on people and planet. Public and private organizations must learn to assess value beyond profit-driven motivations. The notion of social value originated with the recognition of corporate responsibility and ethical economics. Public awareness of these social enterprises has been successfully used to enhance the organization’s competitive edge (Watson et al. 2016).

In the building industry, an expanded view of mutually beneficial sets of expectations can engender proactive and innovative ideas and behaviors that can grow and expand over the life of the project and beyond. The need to balance the concerns of the triple bottom line (people, planet, and profit) for sustainable development projects has attracted the attention of global entities such as the World Bank’s International Finance Corporation (IFC). The IFC has clearly established guidelines for projects that require engaging all affected stakeholders early in the development process to define the impacts, feasibility, and long-term benefits of projects across the globe prior to implementation (Levitt 2007). Determining the value of building projects beyond profit-driven motivations is key to sustainable building projects. However, the long-term benefits must go further than simply return-on-investment measures of building operating costs. These metrics need to extend into the qualitative nature of stakeholder interests and experiences. The stakeholder population must encompass not only the building users but also the surrounding community, as well as environmental impacts on the planet at large. While these metrics are much harder to capture and quantify, they may be just as significant for the life-cycle impact and social value of the building project (Watson et al. 2016).

These participative activities and behaviors on the part of the community can be categorized into active, passive, and non-relational modes and weighed against goodwill/relational benefits or economic/transactional costs to the project (Grönroos 1997). Defining and quantifying these intents and outcomes establish a clear and transparent relationship between the project team and all impacted parties. It provides guidelines for private and public participation in the project delivery process and defines the level and intensity of communication among the stakeholders. The leadership of the project team can assume either a relational or transactional posture relative to community involvement and value perception. Value perception entails more than just the tangible offerings of the physical project but also the experiential and emotional factors associated with the project. The established relationship can include distinctly different short-term commitments and long-term implications. Even if the project leadership determines that it is in the best short-term interests of the project to focus on the transactional, cost constraints of the project, the latent relationships with the user and professional community stakeholders still exist (Grönroos 1997). This is true regardless if the community stakeholders choose to engage with the project in an active, passive, or non-relational mode. Thus, garnering social capital for a building project can have short-term benefits and long-term ramifications and builds sustainable value.

For ACH , community participation had manifested in a number of ways. First, there was the willingness of the city to cooperate with the project stakeholders in providing transportation modes to access the hospital site. Secondly, the motivation on the part of family members to participate in the mock-ups and test runs of various procedures ensured optimal design solutions of the hospital facilities. Thirdly, the initiative and effort of the team members at every level of the project structure to engage in activities that would maintain a high energy level of the stakeholders, from dressing up as Santa Claus and distributing gifts to sick children to team lunches, helped hold each other engaged and accountable every day on the construction site. The active participation of the various stakeholders at different points in the project delivery created social value for the team member, the hospital user population, and the community at large. The team members built a level of comradery and social capital among each other, which became transferable to future projects. The hospital staff, patients, and families became vested in the success of the project outcome based upon potential mutual benefit. The community population, whether actively, passively, or not directly involved, realized a potential long-term resource, which created goodwill toward the hospital and the project team organizations.

A community relations matrix, illustrated in Table 2, provides a framework by which to assess the cost versus benefit of a strategic approach toward stakeholder and community involvement. The assumption is that a relational strategy is possible because latent relationships with stakeholders in the community always exist. However, the project leadership must discern the development costs and benefits at project conceptualization to assess its quantitative and qualitative value to the project over time. To address the life cycle and sustainable impacts, the calculus must be done based upon short-term or initial costs and benefits, as well as the ones over the lifetime of the project development. A comparison of the impacts between the relational intent of the team to be inclusive and open to stakeholder and community involvement and a transactional intent, which limits participation, needs to be assessed at the outset of the project. It is important to note that the benefits are not necessarily tangible but can also be perceptual. Furthermore, the relational intent generally produces benefits that are long-term, in contrast to the transactional intent, which is typically immediate (Grönroos 1997).

Gaging the nature and interest level of the community and stakeholders in the development project and aligning it with the project team intent can greatly affect the success and performance levels of the project outcome. For example, an active relational mode on the part of the community met by a transactional intent of the project leadership can result in a confrontational short-term situation and long-term negative perceptions of the project. Conversely, a non-relational community mode met with a transactional intent could have no consequences in the short-term. However, if the non-relational mode is latent and not identified, the long-term impact on the project could still be negative. Similarly, a passive relational mode from the community may imply a lack of interest in the short-term. However, if the project team does not offer a relational intent, the long-term perceptions could have negative results.

The consequences of perceived social value may be significant and obvious when considering a children’s hospital. The ability to create goodwill using a relational intent in the context of a community housing a children’s hospital may be obvious. However, this rationale can be generalizable to any organization that provides a service and is dependent on consumers for its survival. The network of influence that the building project exerts on its surroundings both local and global is not limited to its property lines or the length of its development cycle. The building industry must recognize its impact on sustainability with the capital “S”. An approach to assessing the costs and benefits of a relational versus transactional relationship between the project team and community stakeholders is illustrated in Table 7.
Table 7

Community relations cost/benefit matrix

  

Project Team

Project Team

 

Relational intent

Transactional intent

Community stakeholders

Active relational mode

Short term

Costs

Benefits

Short term

Long term

Costs

Benefits

Long term

Passive relational mode

Short term

Costs

Benefits

Short term

Long term

Costs

Benefits

Long term

Non-relational mode

Short term

Costs

Benefits

Short term

Long term

Costs

Benefits

Long term

Source: Adapted from Value-driven relational marketing (Grönroos 1997)

Practice Exercise #2: Assessing the Relational Interests of External Stakeholders and Community

A series of open forums with both the internal project team and external stakeholder community can flush out the modes and intents, which can be documented as outcomes and evaluated against short- and long-term project success metrics.

A sample of three distinctly different types of groups is self-identified using an outreach program directed at the community and user populations that represent the three categories active, passive, and non-relational mode. Each group can be further refined by selecting the level of commitment and value perception the participant identifies with for the project in question. In a moderated roundtable discussion with the groups, the team members can discern the stated and implied opportunities associated with the project (Table 8).
Table 8

An assessment work sheet for individual stakeholder and community members

Community stakeholder

Active relational mode

Passive relational mode

Non-relational mode

Level of involvement

 Current

   

 Future

   

 None

   

Level of commitment

 Direct

   

 Latent

   

 None

   

Value needs (total value created that a user needs to feel satisfied)

 Tangible

   

 Experiential

   

 Emotional

   

Once the qualitative input is collected, the project team discusses and prioritizes the influencing factors. The list of factors is then assessed based upon initial and life-cycle costs/savings as well as short- and long-term benefits/shortcomings. The trade-offs are explored and documented in the cost/benefit matrix, which highlights the project team relational versus transactional intent, as well as the consequences to community and stakeholder involvement in the project. In a public forum, the representative team members report back to the community and stakeholders the outcome of the analysis and negotiate the final terms of the relational and/or transactional arrangement. This ensures a common understanding and shared narrative of the project vision.

Engaged Sustainability Through Flexible Cohesion

A relational team structure supports participatory and helping behaviors of teams by creating an integrated project environment. The driver and enabler of this team environment is team member cohesion. Team cohesion is characterized by goal commitment, timeliness and extent of communication, and interpersonal attraction (Franz et al. 2016). A fourth factor of team cohesion is the willingness to compromise or adapt (Franz et al. 2016), which is an indicator of individual flexibility. Team cohesion is defined by the extent to which the project team engages with and adapts to each other to create the relational environment. Cohesion has been considered as the most important factor in the study of working teams (Carron and Brawley 2000). As projects evolve over time and move from requirement gathering phase to design phase to build phase, engaged team members adapt to new circumstances and work with their fellow stakeholders toward agreed-upon goals. Because they established a relational climate and leverage relational contracting , they share common vision and values for the project. These might be commitments to reduce waste, recycle materials, use innovative design strategies, and engage with the stakeholders and the community. In other words, a cohesive building team grounded in a relational structure results in engaged sustainability of people, planet, and profit.

Cohesion and flexibility are key determinants of team effectiveness (Burke et al. 2006). As time and the project progresses, roles change. A team member’s ability to adapt to their new authority, tasks, and other stressors, combined with their ability to continue to communicate effectively and work with their teammates in the new dynamic has an outsized impact on healthy team functioning. Cohesion is the bond between members of a group holding the group together (Beal et al. 2003; Hampson et al. 1991; Kadushin 2012; Olson 2000; Pescosolido and Saavedra 2012). Flexibility or adaptability is the “capacity (and willingness) to competently engage in a variety of behaviors in response to different situations” (Lord and Hall 1992, p. 140). In our work team project delivery context, flexibility includes an individual’s ability to cope or adjust to role expectations which are perpetuated through culturally established processes (Wolin and Bennett 1984). Flexibility is a factor in individual decision-making whereby the individual balances emotional response with logical or cognitive responses (Mayer and Salovey 1995).

Flexible cohesion is an individual’s ability to adjust to different named roles in a team over time as the nature of the team’s task evolves. Flexible cohesion is associated with an individual’s willingness to engage in team environments (Straub 2015). The idea of a named role is a shortcut for connoting a level of authority and responsibility. Titles, especially in project settings, are often named roles. These can be problematic as projects evolve, especially when titles may have different meanings in various contexts. A relational project climate creates the conditions in a multilevel team structure that enables flexible cohesion among individual stakeholders. This is supported by a multiparty agreement based on a shared risk and shared reward framework that establishes the relational contract between major stakeholders. The context for this dynamic project structure stretches over time and beyond the boundaries of the project site.

It is important to note that balance is critical to a flexibly cohesive team structure in a relational framework. Too much or too little flexibility or cohesion in a team member or group can divert team efforts resulting in detrimental effects on the overall project outcome, as illustrated in Fig. 3. If the level of team cohesion is low, the team members are generally disconnected and will not participate in collaborative problem-solving efforts. As a result, team members pursue their individual agendas, and the project team fails to reach an integrated problem solution. Conversely, if team members are too cohesive or aligned, they can exhibit groupthink, focusing only on narrowly defined issues and reaching consensus too quickly.
Fig. 3

Flexible cohesion matrix (Adapted from circumplex model; Olson 2000)

Flexibility also has a goldilocks zone. Individuals and teams who exhibit too much flexibility tend to lack focus. When flexibility is too low, individuals and teams can become rigid and fixed in their ways. In a situation where the tendency is toward excessive levels of flexibility and cohesion, the team is likely to chase every idea and opportunity that presents itself. Low cohesion combined with high flexibility results in pet projects and lack of commitment to the project vision. Both conditions can lead to inadequate resources applied to critical tasks and schedule slippages due to lack of focus. In situations with low flexibility and low cohesion, it would be quite difficult to establish a relational project structure; however, team leadership must beware that the organizations or individual participants may not understand the expectations of a relational structure at project initiation and make commitments that cannot be kept. In the case study example, the ACH team adapted the design to accommodate construction changes not in the original documentation. In a transactional context, this would have resulted in significant rework, cost, and schedule impacts; however, with a flexible, cohesive team operating in relational context , the issue was examined, models were built, and tests were run to quantify the impact on the final product. Because the impact was not significant, the change remained, and the project stayed on schedule and under budget.

Conclusion

An essential paradigm shift in built environment delivery is the notion of a relational project team framework that is the basis for successful project outcomes. However, it is important to understand that the project delivery mechanism is only partially responsible for the ultimate project outcome. Although a project framework can significantly influence the project dynamic at both the individual and team levels, flexible cohesion among team members is the key factor in aligning the vision and values of stakeholders with project outcomes. This conclusion implies that a building project must be viewed as a long-term, relational event and team members have to be viewed as vested partners that commit to the vision, values, and a common vernacular of the integrated project delivery method.

Reflection Questions

  • Is engaged sustainability a worldview or a checklist of attributes?

  • What defines the relational environment that delivers the desired project outcomes in the built environment industry?

  • What effect does this relational environment have on the project team members?

  • What are the characteristics of the organizations or team members who are more successful at achieving the desired project outcomes?

  • How are these organizations or individuals identified and engaged?

Akron Children’s Hospital: A Case Study

Introduction

The case study of a construction project at Akron Children’s Hospital demonstrates how a project team can have transformational results when incorporating the concepts of relationship building and mindful behavior into a project delivery method. At Akron Children’s Hospital (ACH), we found that using these techniques in conjunction with Lean Integrated Project Delivery methods not only delivered but also exceeded all expectations in regard to cost, time, safety, and expected operating margins (Fig. 4). The ACH construction team drove first cost 26% below market estimates ($178 million vs. the original estimate of $240 million), accelerated the schedule by 16%, and achieved a 40% better safety record than the national average and a 99.2% cash flow predictability with an increased operating margin of 33%. Furthermore, the building is 34% more efficient than any other building of its kind based on energy usage. Since the completion of the building, ACH is recognized as the fastest-growing children’s hospital in the country despite the below 1% population growth in its demographic region (Fig. 5).
Fig. 4

ACH New Hospital Wing

Fig. 5

ACH project data – Welty Building Co.

Background

In the last 50 years, the construction industry has seen productivity decrease by 10%, with more than 50% of projects either over budget or behind schedule. All other non-mining business productivity has increased over 250%. How is this possible? The Lean Construction Institute says one major problem is that 60% of the activity on a construction project can be classified as waste. The transactional nature of the design-bid-build contract does not support collaborative environment. In fact, it encourages a singular focus on one’s own scope of work for a predetermined bid price regardless of the consequences on the total project budget. Relationships are often adversarial. As a result, construction is one of the few industries where suppliers sue customers and vice versa (Fig. 6).
Fig. 6

Construction industry productivity (Smart Market Report, McGraw Hill)

Even today, the typical building company leadership believes that the transactional relationships between firms and a top-down decision-making approach to project delivery produce the best results. Welty Building Company took a different tack on the Akron Children’s Hospital expansion project. This approach was first motivated by Bill Considine, CEO of Akron Children’s Hospital, when he said that we need to design and build the ACH Critical Care Tower through the eyes of the child. Our guiding principle stated that we intend to create a place that (a) is distinctive and serves as a beacon to the community; (b) is safe and comforting to children, parents, and staff; (c) is a respectful connection to the natural environment; (d) is playful and engages the imagination; (e) inspires confidence and hope; and (f) builds on a promise. If the project team was successful, the built environment created would feel like a hug to a child. A hug is a connection that fills us up, makes us feel more in control, and is a part of something bigger than ourselves. A built environment’s expression of this mission enables the nurses, doctors, and staff to enhance the patient experience. What we found was this vision and values transcended the attitudes and behaviors of the project team members. Instead of a testosterone-filled environment on the jobsite, the construction team encouraged each other by awarding “bambino,” small stickers with the project logo and motto. Workers proudly pasted these stickers on their hard hats in a manner akin to a football team tradition of awarding stickers for touchdowns (Fig. 7).
Fig. 7

Bambino stickers (Welty Building Co.)

At the Welty Building Company, the motto is ER>=CR, employee relationships are greater than or equal to customer relationships. This people-centered attitude translated to the project team work environment. We found when a team believes it is all right to give a hug and the leadership team gives them a way to give a hug, all traditional metrics of performance improved. The integrated project delivery (IPD) method used on the ACH project maximized customer value by eliminating waste. IPD is based in a formalized relational contract between the owner, contractor, and architect to construct a building. The premise is that the three entities become stakeholders in the outcome through shared risks and shared rewards. The key to making IPD work in construction is authentic collaboration. With input and agreement from all three stakeholder groups and sub-consultants, a fully coordinated solution and project plan is devised that meets program requirements within the available schedule and budget. The difference between IPD and traditional project delivery methods is that all issues must be resolved by the project stakeholder team and no issues are left unresolved. Projects are integrated through collaborative leadership, coordination, communication, and interaction.

Discussion

Welty Building Company acting as the construction manager on the ACH project recognized project members as trade partners. On typical construction projects, the building trades are typically referred to as subcontractors, a second-tier participant below the construction manager. Welty embraced the integrated team. This structure enabled a 30-year tradesperson to participate in the discussion, thus, engaging all team members and the entire workforce to innovate and drive a better result. This integrated team culture was reinforced at every opportunity. On a regular basis, the entire construction crew ate lunch together. The team leadership would bring in food trucks and celebrate safety success. The project team members came in before and after work hours to play Santa Claus and directly interacted with the children in the hospital. Every time a project team member gave a hug as they handed out a present they were receiving a hug back. These connections manifested in self-reinforcing moments that enabled innovation and enhanced building project outcomes. Paul Becks, the project manager for Welty on the ACH project, spoke specifically to how they brought the team together: “I think there must be a certain amount of empathy for other people that they’re human, that problems exist and hopefully they have the same respect for you … you can’t be crucified every time you make a mistake and you can’t go crucifying other people every time they make a mistake. Time spent assigning blame is time not spent understanding the root cause and preventing future mistakes. Skip the blame, find a way to get it done, and find a way to make it an enjoyable experience and that happens when you stay focused on what the mission needs to be; why we are doing this. We do a stand down every Tuesday right after lunch where the entire project, all the guys, we get them all together and I let them pick the song of the week. It was the 80’s song ‘Safety Dance’ last week. We play a song, we talk about safety. Last week there was a guy up in Cleveland that died on a jobsite and we had a moment of silence. We had somebody who knew the guy speak. It’s an opportunity to bring everybody together.”

What Welty has learned is in order to get the team to apply the building science of lean you need to create an environment where it is all right to give a hug. We saw this at the ACH project when the construction workers hung hearts and Christmas trees from tower cranes so the children could see them from their hospital beds (Fig. 8).
Fig. 8

Heart on the construction crane

In a recently published study based on the Akron Children’s Hospital project, the authors introduced the concept of upcycle construction capital (Paolillo et al. 2016). Upcycle construction capital is defined as the collateral benefits produced by a building project over time. The shift is in the emphasis from the initial construction cost to the lifetime costs created for the business, as well as the upcycle benefits for the stakeholders, the community, and the planet. In the traditional delivery processes, the creativity, passion, and expertise of the entire project team go unrealized as individuals and management are mired in transactional relationship of exchanging fees for services. The design-bid-build contractual process has focused on the initial construction costs with no reward for collaboration outside the individual project effort. An integrated project delivery method that can generate long-term benefits for the three Ps (people, planet, and profit) include but are not limited to safer working conditions, decreased first construction costs, reduced operating costs, lower energy costs, increased positive affect (good feelings) in the community, incremental revenues, increased operating efficiencies, and individual competencies. These constitute the integrated sustainable benefits (Fig. 9).
Fig. 9

Upcycle construction capital

The Welty Building Company made a claim to the Akron Children’s Hospital to be more than a builder of buildings. This promise required that the entire building team had to reach beyond expectations. They had to strive to innovate in the use of technology, be an advocate for the environment, and build community. At the outset of planning, the project was projected to cost $240 M using traditional project delivery methods. Through creative leadership and collaborative teaming, the project was brought in at a final cost of $178.3 M, 6 months ahead of the projected schedule. The lower operating costs and quality of the built environment exceeded the original expectations of the ACH.

Don Taylor, CEO of Welty, said: “I’m a believer in IPD and especially when you incorporate lean. It’s got to be a better way … I’m sure you’ve read this statistic that there’s something like 60% waste in the construction industry, as they’ve defined waste, so here we are arguing about 1.75% and 2% fees and we’ve got 60% waste in a project. If we can get rid of some portion of the waste which benefits the client we probably can make a little more money or take the pressure of the profit side of the project and have everybody win. To me, that’s where we’ve got to go. We can get paid what we are entitled to and the client gets the benefit of the project costing less overall. We impact not only first costs but the image of our clients in the community. The way we have succeeded as company is to focus not just on the building a building – but build the building to support the users of that building and the community effected. On this project the team did a great job working with the city to enhance public transportation access.”

Conclusion

ACH’s intention was to create a distinctive place in the community that is safe and comforting in the eyes of a child, parent, and staff. The culture surrounding the project delivery team was developed with these values as unifying themes. The team’s sense of relatedness to the greater good of the children combined with the mindfulness of an integrated team served as a prerequisite for creating shared vision, values, and language used by all the trade partners. This created better relationships and improved their ability to deal with conflict, encourage open communication, and drive better project outcomes. Welty has found when a team believes it is all right to give a hug and the leadership team gives them a way to give a hug, all traditional metrics of performance improved. The Welty Building Company is currently using these same concepts in a variety of project types such as high-density mixed use, energy transmission and distribution, general office, and medical facilities. All have documented project results showing lower first cost, improved schedule, improved operating margins, and a more engaged construction team.

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Copyright information

© Springer International Publishing AG 2018

Authors and Affiliations

  • Branka V. Olson
    • 1
    • 2
    Email author
  • Edward R. Straub
    • 3
  • William Paolillo
    • 4
  • Paul A. Becks
    • 5
  1. 1.School of ArchitectureWoodbury UniversityBurbankUSA
  2. 2.Sindik Olson AssociatesLos AngelesUSA
  3. 3.Velouria Systems LLCBrightonUSA
  4. 4.Welty Building CompanyAkronUSA
  5. 5.Welty Building CompanyAkronUSA

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