Fast tracking a hospital construction project can reduce costs and enhance quality—as long as hospital leaders consider project expectations, decision making, and commitment of participants.
At a Glance
Hospital leaders should consider four factors in determining whether to fast track a hospital construction project:
- Expectations of project length, quality, and cost
- Whether decisions can be made quickly as issues arise
- Their own time commitment to the project, as well as that of architects, engineers, construction managers, and others
- The extent to which they are willing to share with the design and construction teams how and why decisions are being made
There is a lot of discussion these days about the pros and cons of various contractual approaches to hospital construction. These discussions often focus on which approaches enable a project to be completed more quickly: Traditional design-bid-build? Design-build? Construction management at risk? Integrated project delivery?
One way to speed construction that can be used with any of these approaches is fast tracking—the release of a project in stages or packages. This method expedites delivery of a completed project and often results in reduced costs and enhanced quality.
How Fast Tracking Works
In fast tracking, the various components of the construction process overlap rather than proceeding in strict sequence.
Fast tracking can involve the simple release of a limited number of early construction packages, such as site development, structure, and interior building fit-out: For example, while site work begins, one team can begin to develop the structural package as another team prepares the interior portion of the project, so that significant headway can be made on several aspects of the project at the same time. Fast tracking also can involve early production on mechanical and electrical systems as well as building “envelopes,” or exterior skins, so that these portions of the project will be ready at the exact point that they are needed.
The benefits of fast tracking can be significant, as Stamford Hospital in Stamford, Conn., is discovering. The hospital is embarking on a four-year,$282 million building initiative that includes the construction of an additional bed tower, renovations to the existing facility, site work, and the development of a separate utility plant that will provide all of the hospital’s power and cooling needs. The site work that will be performed, as well as development of a central utility plant, are make-ready, or enabling, components—aspects of a project that must be completed before taking on larger components of the project.
As a result, Stamford can potentially expect to begin treating patients months sooner than anticipated—and could realize revenue from its newly renovated and expanded facility more quickly.
Four Factors to Consider
As straightforward as this process may seem, fast tracking is not the right choice for every hospital construction project. There are four factors an organization should consider in determining whether to adopt a fast-tracking approach.
Expectations of project length, quality, and cost. Setting firm goals before creating the first design is key to the success of a construction project, whether the goals are to increase revenue by a certain date, improve clinical outcomes for specific populations, enhance the hospital’s brand, or stake out new service line or geographical territory before a competitor can move in. There may be strategic reasons to move forward more slowly with construction.
The fact is, not every healthcare organization will be prepared for a project to be completed ahead of schedule, as Stamford plans to be; there are staffing and operational issues that must be dealt with before a new or renovated facility can open its doors, and for some hospitals, fast tracking these aspects of a construction initiative may not be possible.
And not every healthcare organization is able to manage the requisite cash flow to support fast tracking in the early days of a project. Compared with traditional construction schedules that generally follow a bell curve—starting out with a slow burn of cash that increases as ield work begins, peaks as the project gains momentum, and then slowly works its way back down as the project enters its end stages—fast tracking, whereby specific aspects of a project enter the build stage almost immediately, requires substantial early infusions of cash—up to 15 percent of the total budget. (See the exhibit below.)
Certain items that require a long lead time to acquire, such as specific exterior skin types, air handling units, and medical equipment, also may limit a hospital’s ability to fast track a construction project.
Communication. Fast tracking calls for decisions to be made quickly as issues arise, including the selection of finishes, medical equipment, and even floor plans. Some organizational cultures can easily accommodate an expedited decision-making process, while others cannot. The biggest risk is when the hospital finds it cannot keep up with the required approvals within the timeframe needed to support fast tracking.
Commitment. Everyone on the team—hospital leaders, architects, engineers, construction managers, and others—must commit to the project schedule, quality standards, materials to be used, and total budget. If individuals become bogged down in the details of a particular component of the project, it can be easy to lose sight of the big picture everyone has agreed to—and that can have a disastrous impact on the project’s end date. Overspending during an early phase of the project will require that cuts be made later if the project is to stay on budget.
Transparency. This may be the biggest stumbling block for some hospitals and systems: the extent to which they are willing to share how and why decisions are being made. Unless the design and construction teams understand the organization’s finances and the drivers of a construction initiative, they will not be able to lend their expertise to decisions that could significantly affect the project’s outcome.
For example, the contractor might know of a way to cut costs for exterior skin that would allow the hospital to purchase another piece of imaging equipment—technology that could improve the quality of the facility and its value for patients and the community. However, without knowing the details regarding the hospital’s financial situation, its goals for the initiative, and its original “wish list” for the project (for example, the fact that the hospital would have liked to have purchased a second MRI if the funds had been available to do so), the contractor will have no way of knowing whether this cost-cutting approach is best for the hospital.
This level of transparency requires executive teamwork in the early stages of a project. Ideally, representatives from the design and construction teams and the hospital should meet regularly to make overarching decisions related to the initiative. Depending on the extent and sophistication of its internal resources, the hospital’s representatives might include the COO, CEO, CFO, chief nursing officer, and possibly a program manager (e.g., a consultant who has been hired to oversee the project on behalf of the hospital). This group’s focus should be on whether the project is aligned with the original vision the hospital had for the initiative, whether the initiative meets the hospital’s needs, and whether it is affordable, rather than on how a particular piece of steel will be bolted. Everyone involved should contribute to the decision-making process.
Another Option for Fast Tracking:Design Assist
Mercy Health-Rookwood Medical Center, Norwood, Ohio, is fast tracking a $10 million design-build project—a stand-alone, 25,000-square-foot, multistory emergency department facility with ground-level parking—with the help of a process called design assist. Design assist is a method of contracting that can help organizations save money on the mechanical-electrical-plumbing (MEP) component of a construction initiative, which typically accounts for 40 to 50 percent of total project costs.
The idea here is to have not only the architect and construction manager at the table early in the project process, but also representatives for the major trades that will be working on the project, so that they may offer their expertise in designing MEP systems quickly and cost effectively. Design assist takes advantage of the growth in sophistication in the subcontractor market, and utilizes their knowledge to produce a better product from the early phases of the project.
The back-and-forth design work between engineers and subcontractors can at times be a protracted process. Design assist cuts to the chase by having the engineers take the design only to the schematic phase and then turn it over to the subcontractors for design completion.
Financial Controls for Fast Tracking Projects
For fast tracking to be successful, the team must design to budget rather than budget to design.
In simple terms, this is the difference between “Here’s what I’d like. How much will it cost?” and “I have $100 million to spend. Here’s what I need to get for that amount of money.” The great thing about a transparent approach to facility planning and construction is that when design and construction teams understand a client’s expectations and budget from the start, terrific ideas often emerge that make it possible to expand the scale of the project for the same amount of money—or build the same project for less money.
If a hospital has budgeted $24 million to build four operating rooms and ends up with $5 million left over at the end of the project, the hospital may have lost an opportunity to put the budgeted dollars to better use. The point of having everyone on board early is to identify ways to build more efficiently, so that hospital leaders can then determine whether to use the savings to invest in additional technology, equipment, or facility upgrades, or whether to reduce the amount of money the hospital will have to borrow to fund the project.
Once construction is under way, an electronic project cost log can help keep expenditures on track. Every decision that has financial implications for the project should be recorded— including cost, time elements, action, and rationale—and then evaluated by the team periodically, beginning with the preconstruction phase and continuing for the duration of the project. A big job will involve literally thousands of decisions. Keeping an electronic project cost log allows hospital leaders to pinpoint when decisions were made and why, as well as the cost impact of such decisions.
Another useful financial transparency tool is the electronic dashboard, which can display project metrics related to quality, safety, budget, cash flow, project schedule, and more. Dashboards should be updated in real time so that hospital leaders can view the most current information whenever they choose or when indicators reach predetermined trigger points.
Ensuring Quality in a Fast-Tracked Project
One key to user satisfaction with the finished product is to build mock-ups that key stakeholders—primarily physicians and nurses—can walk through and either approve or recommend be revised early in the project, when revisions will cost significantly less than they would at a later stage.
It can be impossible for a clinician to determine, based solely on a two-dimensional drawing, that a surgical light should move five inches to the left, that a glove box should be moved higher on a wall to avoid the need for clinicians to continually bend to reach its contents, or that medical gas lines should be closer to patient beds. For that reason, it’s important to specify in contracts that mock-ups should be provided at the subcontractor level.
Today, electronic monitoring applications make it possible for project leaders on both sides to monitor quality exhaustively and from a distance via computers and mobile devices. For example, one mobile application enables program managers to view and “touch” a specific elevation of a building on a small screen; doing so provides access to a report stating whether that portion of the building was tested for air and water tightness, by whom, and on what date.
Another application helps to keep disruption to a minimum during a renovation or addition project by monitoring dust, vibration, and noise levels and sending alerts when these measurements reach predetermined danger levels in existing occupied areas.
One of the most useful quality controls in the construction industry is making its way from European to American hospitals: prefabrication involving multiple trades. This process allows builders to assemble components such as electrical, plumbing, and HVAC systems in a local factory on a three-dimensional rack instead of building them overhead into the ceiling on site, as is traditionally done. Once the components
are ready to be installed, they are moved to the new or renovated facility. Prefabrication of electrical, plumbing, and HVAC systems not only saves time, but also boosts quality by allowing workers to easily inspect each joint to make sure it is taped or soldered properly. This process also increases safety in the field and cuts down on waste (everything is preordered to length, eliminating the need to measure and cut copper pipe in the field).
These kinds of strategies lend themselves to the fast-track delivery process and can ensure that quality is not compromised simply because a project is being delivered at a faster and more efficient pace.
Opening the Door to Opportunity
For hospitals that are transparent with design and construction partners about their objectives and financial outlook, have the ability to expedite decision making, and have access to sufficient cash to cover a greater portion of construction-related expenses early in the process, fast-tracking a construction project can offer a number of advantages. These advantages do not simply stem from moving forward with a project more quickly. Rather, intense and sincere collaboration, in which every party to the project brings its best game, opens the door to enhanced quality and more economical ways of building and operating healthcare facilities.
Andrew Quirk is senior vice president and national leader, healthcare center of excellence, Skanska USA, Nashville, Tenn. (firstname.lastname@example.org).
Publication Date: Friday, March 01, 2013