JPAC® - Early Warning Signal, Lead Indicator and End-Of-Job Performance Predictor
When do you find out whether a project is a “winner” or a “loser”? If you’re like most contractors, that answer varies widely, but through years of research, MCA has found that most construction companies cannot predict profitability reliably until close to 90% complete. This is when the scrambling begins. So what went wrong? More importantly, when did these problems occur? What if these issues were uncovered much earlier? What would that mean for every project moving forward? Agile Construction® Practitioners are using Job Productivity Assurance and Control (JPAC®), based on the ASTM Standard E2691, the only standard for measuring productivity in the construction industry, to accurately predict profitability as early as 20% complete. JPAC® is used to track productivity on a weekly basis and aids in risk management. This is the only tool that provides early warning indicators of issues on the job, allowing the project team to act immediately to get the project back on track.
Figure 1 shows JPAC®’s weekly productivity trend monitoring that provides immediate feedback on how your job is doing. It even allows you to track labor productivity for individual jobsite activities (cost codes) to identify, discuss and resolve the root causes of productivity deterioration with the field, which will help make your projects and labor management visible and better manageable. Agile Construction® Practitioners use JPAC®'s early warning signals and lead indicators to uncover and correct profit killing causes for a job as early as possible. No more waiting until the job is almost complete to know where profits stand.
|Figure 2: JPAC® Productivity Differential vs. Final Gross Profit @ 25% complete|
Figure 3: JPAC® Productivity Differential vs. Final Gross Profit @ 75% complete
Figure 2 and Figure 3 show that there is a direct correlation between labor productivity and a job's final financial performance (solid line). Figure 2 shows the relationship at 25% complete while Figure 3 shows the relationship at 75% compete. At 25% project completion, JPAC® reported that the current labor productivity is more than two times less productive than estimated. With each red dot representing a real job, all jobs below the dashed line ended up earning less than expected profit, while jobs above the dashed line made more. With the information that JPAC® provides, project teams can utilize these early warning signals to prevent issues and improve job performance, and therefore increase profits.
Both figures illustrate the direct relationship between labor productivity and a job’s final financial performance, i.e., the more productive the labor, the better the financial performance of the project. As projects make progress and most of the work has been completed, the financial impact of labor productivity, whether it be better or worse, becomes clearer and more direct, Figure 3. As the only industry standard for measuring productivity, JPAC® is able to predict how good or bad your job will do at the end in early project stages. It will help you manage your jobs more effectively and more efficient by providing early warning signals and reliable lead indicators for jobsite issues at early project stages that were previously not visible. On larger jobs, this may add months or even years to your opportunity to regain losses, improve cash flow and earn your estimated profits. Having your jobs using Agile Tools and following Agile Construction® Principles helps you predict and mitigate your business risk and push the financial success of your company.
How do you know how Agile your projects are?
MCA is happy to announce that its upcoming Agile Construction® Project Rating will help you answer this question. In becoming Agile Certified, your projects will continuously undergo a standardized and rigorous screening and assessment of the processes and procedures in place - from job setup to project closure, from procurement to installation, cost reporting, billing, etc. Being Agile Certified will give you the opportunity to not only benchmark jobs and identify hidden Agile Champions within your company, it will also allow you to benchmark and compete with your industry peers. Stay ahead of the industry and prepare for the Industrialization of Construction® in becoming Agile Certified, which will be your competitive advantage to succeed in this industry of increasing competition, challenges and risks for contractors.
Impacts of IPD in Subcontracting and Utilizing WBS as a tool
Integrated Project Delivery Construction (IPD) is becoming more apparent in this industry. If managed properly, these projects can offer a very high reward. What differentiates IPD Construction from the typical construction? IPD projects require a collaborative alliance of people, systems, and business structures to work together throughout the entire process. With all parties collaborating, the project will have optimal results, increase value to the owner, reduce waste, maximize efficiency through all phases of design, fabrication, and construction, and solve problems of low productivity and quality issues. Although IPD offers high reward, it also poses challenges for subcontractors. If any single stakeholder is unwilling to fully embrace IPD, doesn’t understand what IPD requires, or has a negative performance, the entire team will be disrupted and the project can suffer. IPD requires subcontractors to be involved in the early stages of conceptualization, design, and construction.
Subcontractors should utilize Work Breakdown Structure (WBS) as a tool for connecting between subcontractor and General Contractor IPD requirements. Once the trades have defined their scopes of work and the effort required, they can work collaboratively to translate the WBS into an integrated project schedule. The WBS is built on a sequence of WORK and therefore is a ‘forward pass’ of the work that will happen onsite from our perspective as the skilled trade. The GC schedule will only provide a sequence of TIME for when certain activities need to happen, as a ‘backward pass’. Both schedules need to be taken into account and once integrated, that will yield a very useful schedule because it can be used for communicating the conflicts and ensuring proper coordination. MCA offers WBS services in person and through webinars, in addition to other scheduling services:
- 3 Week Look Ahead Scheduled Planning
- General Contractors Scheduled Planning
- Electrical Contractors Scheduled Planning
The 3 Week Look Ahead Scheduled Planning provides insight on labor needs, material & equipment needs, tool needs, and takes into account the schedule of values. MCA offers additional tools that provide real time data directly from the field, Short Interval Schedule (SIS®) and Job Productivity Assurance and Control (JPAC®). Subcontractors can use data from SIS® and JPAC® to prove common causes and direct feedback of jobsite conditions so the GC can take action to avoid schedule delays.
(For more information on MCA services, click here.)
A Perfect Time and Place for Agile Construction® Collaboration
The change in IT infrastructure usage and the growth in cloud-based solutions across major industries have led to high investments into green and brownfield data center construction across the U.S. Together with the increasing demand for Green Data Center facilities, the U.S. data center construction market is projected to witness significant growth, which will provide higher revenue and market share opportunities for construction contractors and sub-contractors.
While most calculation methods provide estimates for the overall U.S. market volume, MCA’s unique market study methodology has the ability to capture and quantify the available market size in the data center market segment in your specific geographical area. This methodology has been recently applied in a market study conducted for the Chicago area to estimate the data center work available for electrical contractors.
Agile Classes Highlights
MCA is known in the industry for its research as well as Agile Construction® classes and workshops. Since January of 2019, MCA has conducted more than 35 official trainings and educational events. Over the last year, MCA has expanded the Course and Workshop offerings and is excited to announce that 2019 has been the first year MCA’s Agile Construction® Workshops went online, taught remotely, and accessible from everywhere via the internet.
Online modularized Workshops, Figure 7, are now available and are being held on a regular basis, which makes it possible for companies all over the world to benefit from the MCA deliverables in their own facilities without the costs of travel. MCA has also expanded the Agile Construction® Series. In addition to the 101 Workshops, Figure 8, MCA now offers Agile Construction® 201 classes for basic Agile Users to extend their knowledge and usage of the Agile Principles.
Figure 7: Agile Construction® 101 Webinar Series
Figure 8: Agile Construction® 101, Omaha, NE
One of the most valuable aspects of training with MCA is that we not only own the product development, we are the originators of the methodology. It is this expertise that makes such a difference for our clients. Many companies can train on the “How” to use a product. MCA makes it our mission to help our clients understand the “Why” behind tracking labor productivity and how to actually interpret the data. The results are clear, proper use of JPAC® and SIS® will put more money in our customers’ pockets on every project as long as they understand what is being measured and what to do about it. For more on classes and workshops, click here.
Nick Alosio and WEM®
WEM® is proud to announce Nick Aloisio as its Director of Sales. In an effort to bring the revolutionary productivity boosting software JPAC® and SIS® to the masses and further the Industrialization of Construction® happening in the Construction Industry, WEM® has officially launched its sales division. Nick brings with him close to 20 years of experience in the software and construction industries. He is, first and foremost, a problem solver and will stop at nothing to understand and satisfy his clients’ needs. Nick fully understands the issues within construction industry and he believes in hard work, accountability and will stop at nothing to solve his clients’ problems. WEM® is fully committed to Making Productivity Visible to Everyone® and we are excited to help our clients in their mission to gain visibility and boost profitability on their projects!
For information on the latest release of JPAC® and SIS®, please email us at firstname.lastname@example.org
Fall Symposium 2019 Update
Tools for Successful Project Management – Data is King
October 17, 2019
MCA’s Fall 2019 Agile Construction® Symposium in October was a great session. This Symposium was the first of a five-fold Symposium series on Customer Needs and Value Transfer to the Customer. This series will be based on the four major project phases, i.e., planning, procurement, installation and closure, discuss the three main dimensions of a job, i.e., work, effort, and time, and explain why it is important to distinguish and manage them separately.
Speakers of the Symposium included:
- Kevin Lytle, Vice President of Pre-Construction at Electric Company of Omaha spoke of how he uses data from Agile tools, such as JPAC® and SIS®, to predict and reduce the business risk on his jobs. He also emphasized the importance of planning and gave additional insights on challenges to establish a culture of prefabrication through Externalizing Work®
- Jeff Rechlicz, Vice President of Operations at Staff Electric, pointed out the power of the Agile tools and the available data and information for managing projects. He discussed how the data and information in MCA’s Agile Report helps him document and make visible how obstacles and delays in process, caused by the General Contractor, and the resulting schedule compression impact the overall job productivity.
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