Partnering (Archived)

RT-018 Topic Summary
RT 018

Overview

This Topic has been superseded by RT-102.

Within the construction industry, partnering, or an optimum relationship between a customer and supplier, offers many opportunities to improve the total quality and cost effectiveness of construction projects while developing an atmosphere conducive to innovation, teamwork, trust, and commitment. Partnering can be used as a vehicle to attain total quality management (TQM) and enhance U.S. competitiveness in the worldwide marketplace.

In 1987, CII established a task force to study partnering and evaluate the feasibility of this method of doing business. Their conclusions are detailed following. Partnering in this context is defined as long-term agreements between companies to cooperate to an unusually high degree in order to achieve separate yet complementary objectives. Partnering should not be construed as a legal relationship with associated joint liabilities.

  1. Key Elements of Partnering:
    a. Long-Term Relationship
    b. Commitment
    c. Continuous Improvement
    d. Trust
    e. Investment
    f.  Alignment
    g. Synergism
    h. Shared Risks
    i.  Mutual Rewards
    j.  Equity
    k. Systemic Relationship
    l.  Competitive Edge

  2. Benefits of Partnering:
    a. Continuous improvement of the quality of services and products
    b. More effective utilization of resources
    c. Improved profits (value) for all parties
    d. Encourages innovation on projects
    e. Develops long-term teamwork, trust, and commitment
    f.  Allows for continuous planned development of new skills and processes

  3. Major Concerns of Partnering:
    a. Protecting proprietary information
    b. Evaluation/assurance of value received
    c. Fair sharing of risks by all parties
    d. Obtaining/maintaining total commitment
    e. Creates strong dependency on partner
    f.  Limits competitive market strategy
    g. Integration of differing company cultures

Key Findings and Implementation Tools

1 : Partnering Concept

The concept of partnering is based on the premise that important but complementary opportunities may exist between two companies and that if the right people are brought together with an effective organizational process, barriers can be eliminated and mutually beneficial relationships can be established. (SP6, p. 5)
Reference: (SP6)

2 : Total Quality Management

Partnering provides an ideal environment for total quality management because it focuses on a long-term approach of improving ongoing processes rather than an emphasis on individual projects or tasks. (SP17-1, p. iv)
Reference: (SP17-1)

3 : A Partnering Model

Partnering is better thought of in terms of a continuum or model. The “Dimensions of Partnering” diagram shown below depicts key elements of any partnering relationship: trust, long term commitment, and shared vision. (SP17-1, p. 2)
Reference: (SP17-1)

4 : Partnering Survey Results

From a survey of contractors and owners involved in partnering agreements it was discovered that all parties were satisfied that partnering relationship improved cost, quality, and schedule. There was surprising agreement on the quantitative benefits of partnering as well as what makes partnering successful. There are slightly different, but not incompatible, strategic reasons for owners and contractors to seek partnering agreements. Refer to SP6 for tables associated with cost and schedule. (SP6, p. 8)
Reference: (SP6)

5 : Cultural Change

The essential factor in installing a successful partnering relationship is ensuring commitment to the concept by both organizations, including top management and support staff. Management of change should be a joint activity of the partners, so they better understand each others goals and culture prior to integration. (SP17-1, p. 6)
Reference: (SP17-1)

6 : Current Partnering Relationships

The driving force for those seeking partnering relationships appears to be the search for better quality, lower life cycle costs, lower fixed resource requirements for owners, and competitive pressures. (SP6, p. 10)
Reference: (SP6)

7 : Applying Partnering Concepts

To apply the partnering concepts to construction, a “partnering process” must be developed. The four sequential steps to this process are: strategy development, partner selection, contract negotiations, and implementation. (SP6, p. 14) See Implementation Tools for more information.
Reference: (SP6)

8 : Implementation Tool #1

SP6,  Guidelines on Implementation

The research team developed a flow process for implementing a partnering relationship as indicated in Figure 4. This information is also intended only as a model to assist organizations in developing people coordinate flow charts specific to their own situations and organizations.

1) Figure 1: Partner Selection Process Model Flowchart Interaction Summary (Page 16)

2) Figure 2: Partner Selection Process Model Flowchart – Contractor Details (Page 17)

3) Figure 3: Partner Selection Process Model Flowchart – Owner Details (Page 18)

4) Figure 4: Partner Implementation Process Model Flowchart (Page 19)

Reference: (SP6)

9 : Implementation Tool #2

SP17-1, In Search of Partnering Excellence
 
Partnering focuses on making long-term commitments with mutual goals for all parties to achieve mutual success.  The 3 key elements to be successful are trust, long-term commitment and shared vision.  This material includes detailed guidelines proposed for:
  • Selecting a partner
  • Developing a partnering agreement
  • Implementing a partnering relationship
Reference: (SP17-1)
rt-018

Key Performance Indicators

Improved cost, Improved schedule, Improved quality (reduced errors & omissions), Reduced claims, Improved engineering productivity, Improved safety, Improved predictability

Research Publications

In Search of Partnering Excellence - SP17-1

Publication Date: 07/1991 Type: Special Publication Pages: 62 Status: Archived Tool

Partnering: Meeting the Challenges of the Future - SP6

Publication Date: 08/1989 Type: Special Publication Pages: 20 Status: Archived Tool


Tags