Contractor/owner relationships are key for multi-site construction programs

October 9, 2019

A new study from Dodge Data & Analytics, conducted in partnership with Sevan Multi-Site Solutions, explores critical success factors for multi-site construction projects from the perspectives of owners and contractors, according to construction.com.

Multi-site work represents a significant volume of work, whether through a series of small projects across hundreds of locations or through construction programs of new buildings and major renovations.

The report, Challenges and Opportunities in Multi-Site Construction SmartMarket Insight, shows the key factor contributing to the success of these programs is the strong relationship developed between building owners and contractors. The findings look closer at the opportunities for improving that relationship.

“We see clear evidence that established relationships between contractors and owners built on trust and performance produce better results in overall cost and schedule than simply a ‘race to the bottom’ on price alone,” says Steve Kuhn, executive vice president of Sevan Multi-Site Solutions. “When the right contractors are selected for the right reasons, the outcomes are typically better for all stakeholders.”

The study examined nine major areas affecting the success of multi-site projects: how owners source firms for their programs; managing changes to the scope of work; effects of technology; dealing with permitting issues; how to convey lessons learned through a large program of work; how to address skilled labor shortages; enhancing safety on-site; managing material and equipment procurement; and how payment terms influence an owner’s ability to attract companies.

Gaps between the perspectives of contractors and owners emerged, including:

  • Fifty-six percent of owners are confident they know what makes their projects attractive to contractors to bid, but only 16% of contractors agree.
  • Ninety-two percent of owners believe they frequently form and sustain long-term partnerships with contractors, but only 35% of contractors agree.
  • Fifty-two percent of owners believe they are frequently keeping up with changing permit requirements, but only 21% of contractors agree.
  • Seventy-six percent of owners report they frequently communicate their future construction plans to contractors, but only 19% of contractors agree.

However, more than 70% of owners and contractors agree communication and coordination early during a multi-site program improve scope clarity, quality, schedule and budget.