Why the need for digital talent?
Technology has moved beyond simply changing processes and how things are managed.

Digital transformation has spearheaded roles that never existed before in E&C, including: the BIM Manager, GM of Innovation, and Digital Delivery Officer. Technology will continue to be critical in the next wave of growth in the industry.

Employees in the industry will need to be upskilled to help manage and implement digital transformation, and organizations must attract talent eager to harness the power of technology.

How technology drives productivity
Organizations rely on a competitive edge in an industry driven by productivity gains. Margins continue to dwindle, the industry is becoming more fragmented, and there’s a challenge to recruit talent and a skilled workforce.

These obstacles, amongst others, are impacting the rate of productivity and efficiency.

Technology helps empower productivity gains by creating a better flow of information across the supply chain, improved efficiency through standardization, reduced costs, and efficient project delivery.

Should everyone be trained to be an expert?
The simple answer is, no—not everyone needs to be at the same level of competency.

The degree of training and digital savviness will depend on the role type, function, and level of interaction with technology. The workforce can be segmented between highly skilled experts with specialized skills and those who simply need to be aware that the systems or standards exist.

Investing in a phased certification program—ideally provided by the vendor—will help upskill the workforce based on their competency requirements.

Establishing digital talent within an organization
The biggest perceived technology challenge is a lack of qualified employees, according to recent BCG research.

So, how do you encourage and grow digital talent?

Organizations must invest and nurture the existing workforce’s skill set and eagerness to innovate, while recruiters need to evaluate tech savviness in their hiring criterion.

For example, Bechtel created a program called the Future Fund to encourage their employees to innovate and promote emerging trends and technology. The Future Fund provides an opportunity for the workforce to unleash ideas that will help increase productivity and reduce costs across projects. Read the full case study here.

The bottom line: digital transformation is a culture shift that will impact the entire organization. Digital transformation is migrating from the traditional ways of working and will require the support and commitment from everyone, ranging from C-level staff to new hires.

1. Leadership

Sean McQue

Traditional engineering and construction (E&C) projects typically have one individual directing the entire project team. Megaprojects are completed by joint ventures, consortiums, and other alternative delivery models given their sheer size and complexity.

McQue says, “Leaders must motivate people to follow them; you can manipulate or inspire. To succeed, you must inspire” Successful megaproject leaders rely on the following tenants: open, collaborative, innovative, flexible, forward looking.

2. Project environment
The leadership team selects which organizations participate on a megaproject, the contract style and language, implementation, and the systems used to manage data, communication, and processes. A successful project team must be: cooperative, non-confrontational, interactive, experienced, efficient, and motivated.

3. Project plan
According to McQue, the project plan must be “attainable, measurable, and adaptable”, because the plan greatly impacts the team environment and project delivery. A collaborative leadership team sets the baseline and agrees on goals, success metrics, and how project responsibilities are divided. A successful megaproject plan must be agreed by all appropriate parties.

4. People
Nothing is possible without a talented team to develop and support the project environment and plan. The right people have collaborative mindsets, the discipline to measure progress against milestones, and the motivation and skills to reach project goals. “If you have the right people, the rest will fall into place,” McQue says. Skilled team members instill: accountability, collaboration, integrity, skill, and decisiveness.

5. Information management
Implementing information management guidelines are crucial given the sheer size, pace, and numerous components to megaprojects. Mismanaged information can gravely impact cost and schedules resulting in time intensive errors, rework, and disputes.

“If vast amounts of project information aren’t managed correctly, people can drown in information and be starved for knowledge,” McQue shares. Information on megaprojects must be: accurate, accessible by the right people at the right time, complete, and consistent—even more so than on traditional projects.

6. Delivery
The end goal is—of course—ensuring a successful project delivery. McQue states, “A key to project success is for all team members to have ‘a project first’ mindset. A project cannot succeed unless all parties are successful. If all parties are successful, the project will succeed.”

We hear about megaprojects every day—whether they’re airports, power plants, or highways.

According to the Oxford Handbook of Megaproject Management, “[M]egaprojects are large-scale, complex ventures that typically cost $1 billion or more, take several years to develop and build, involve multiple public and private stakeholders, are transformational, and impact millions of people.”

These mighty projects are the essential backbone to our infrastructure, but unfortunately, have very high failure rates.

Many project owners are attempting to apply traditional tools and processes to megaprojects with little success. New contractual relationships and models must be developed—and new team structures put into place—to address the size, complexity, and risks associated with megaprojects.

Megaproject experts share their knowledge
We spoke with several industry experts about how megaprojects are unique in addition to how to avoid common risky pitfalls on the path to success. Bob Prieto, veteran executive of Fluor and Parsons Brinckerhoff, and author of “The Giga Factor: PM in the Engineering & Construction Industry”, and Hans Hoppe, Principle Program Controls Manager with Parsons, share the following:

Megaprojects have completely unique project requirements

Bob Prieto

Prieto says, “It’s not about perfecting an imperfect model, it’s about creating a new one.”

For example, by 2030, the new 743,000 square meter Mexico City Airport will serve 68 million passengers. 82 organizations are working on this massive, extremely complex megaproject which includes numerous systems, security, safety, and regulatory requirements.

Owner and project readiness are essential

Hans Hoppe

Hans Hoppe shares, “How these projects begin makes a huge difference to how they end.”

Projects can quickly start off on the wrong foot—and sometimes never recover—if the substantial scope isn’t defined and the right team members aren’t in place from the beginning.

Lack of project readiness
Many projects start prematurely before the scope is properly defined, the designs well developed, and the essential team members on board. According to Prieto, currently two-thirds of all megaprojects fail due to schedule or budget overruns. Starting a project earlier can appear to save time, but premature launches can result in miscommunication, errors, and a divided, uncooperative project team.

Uncollaborative leadership
Leadership sets the tone for the teams they build. Projects will struggle if project leaders don’t instill a collaborative structure and mindset—a key ingredient to megaproject success. Hoppe says, “The leadership team must strive to deliver one successful integrated project.”

Clear contract terms and language
Clear contract structures and terminology are crucial to a project’s success for all parties involved. “There are enough challenges on megaprojects without introducing adversarial relationships,” Hoppe warns.

The United States Bureau of Labor is predicting that the next four years—between 2016 and 2020—are going to be high-growth years in the construction industry. Though growth has been slower than expected, there are specific career paths that show perpetual promise, and we’ve compiled a list of 10 that you should definitely keep an eye on as in-demand, high-growth areas within the industry.

Cost Estimator

Not all construction jobs require manual labor, so if you aren’t the physical type, there are still plenty of opportunities to work in a lucrative construction-related field.

Among those “hands-off” kinds of jobs, cost estimator is among the highest paying, and demand for good estimators is high. Most employers do require a minimum of education and experience along with the ability to use current cost estimator software before considering someone for this job, but anyone with a finance background and proven success record with budgeting should be able to get a foot in the door.

Construction Manager

Construction managers are also among the best paid in the industry. Many construction managers find themselves making tidy six-figure incomes after just a few years on the job and right now, demand for new ones is high. Government contracts alone over the next few years are going to give rise to the need for many more teams of qualified construction professionals, all of which are going to need solid leadership to keep projects running on schedule and within budget.

Construction managers of all types are responsible for things like that and much more.

Plumber

Plumbers looking to work either directly for or subcontract with construction agencies are in luck in 2016. Direct hires are often required to have minimal educational credentials but will need to demonstrate having completed at least a four- to five-year apprenticeship program to be considered.

For subcontractors, it is a bit easier, although upper management will likely still want to check into experience and references before green-lighting the contract.

The need for plumbers in construction is spurred on by several factors, not the least of which is the upsurge of new building construction that has already begun and is anticipated to be on the rise over the next few years. There is also high demand for plumbers who can do refurbishment of old systems and replace them with higher-efficiency, low-flow systems. It has also been observed that a larger number of plumbers have been retiring in recent years, mostly due to the Baby Boomer generation beginning to make its exit from the active workforce.

Glazier

If you can say definitively that you aren’t afraid of heights, you might want to look into a job as a glazier. Glaziers are responsible for cutting and fitting windows, storefronts, and skylights. They also seal, fasten, and remove glass from every conceivable location and from every conceivable height. The sheer nature of this job leaves it in perpetual demand, and it is a trade that is relatively easy to learn.

Concrete Finisher and Cement Mason

Masons and finishers literally lay the foundations for successful construction projects.

They work with various reinforcing materials such as rebar, then pour, spread, and level cement mixtures, and monitor the hardening of the material. They then apply sealants to create a strong and reliable foundation upon which to build. It is a job of vital importance and requires numerous hands to get the job done. That is why it has been and will remain a high-demand job in construction, and one that doesn’t require years of education or training to master.

Painter

Good painters are always in demand. In many cases, this is one area of construction that can provide entry-level experience that leads to better-paying and even permanent employment positions. It isn’t the most lucrative of jobs, but it often requires no skills or experience, and large jobs call for numerous painters at every skill level to complete the project on time.

How to Write a Solid Statement of Work (SOW)

The Statement of Work, sometimes called the scope of work, can do a great construction contract even better. A well-written statement of work must be clear, complete, logical and concise enough to be understood by the contractor and the construction manager that will be providing the administrative portion of the contract. The SOW must describe in details the expected performance of the contractor, converting it into a measuring tool for the construction manager.

The scope of work must be prepared with help from corresponding departments and professionals that will eventually take part in the developing and construction process. For example, a scope work for a drywall contractor will include types of interior finishes required, designs, material needed, prices and budget, the deadline, special requirements, etc.

What Type of Wording do I Need?

A statement of work wording is vital and must be clear to reduce claims, litigation, and other related problems. A scope of work is the preferred method used in the construction industry to even get construction financing and will be the base for yourconstruction insurance company when providing the proper bonding. A nice SOW should avoid arguable or ambiguous phrasing and must identify the project deliverable and its objectives. Special emphasis should be given to the statement of work wording to avoid or make impossible two different interpretations of the same SOW.

If an action is mandatory, the statement of work wording will contain the words shall ormust. A contractor that receives the scope of work that is unclear, might refrain from participating in the bidding process. The statement of work should avoid including cost of products or services that a contractor may claim they were supposed to furnish or provide.

Statement of Work Basic Components

A statement of work should have the following components:

• Project Overview- A brief statement describing the business needs and a short summary of the project description.
• Project Deliverables– This section should include all the expected goals and targetsthat must be achieved through the project. It must include all related information that will help a contractor in understanding the project’s requirement.
• Project Scope – This section of the statement of work should contain, in terms of budget and technical data, the quantifiable goals set forth under the construction contract, Is an essential part of the SOW. Statement of work scopes might divide the document into two parts:

a. Technical considerations – Specific technical or methodologies relevant to the contractor’s performance and how he will be measured against

b. Tasks – Specific requests and tasks that are needed to satisfy project objectives, with detailed milestones and results that should be obtained from these tasks.

• Project Schedule– Summarize the project schedule including all related task so the contractor can deliver on time. This section of the statement of work (SOW) should contain all important delivery dates, time restrictions, and the expected project duration.

• Project Management– The management section of the SOW must contain a description of how payments will be issued, change control process, specific contract and legal requirements, phasing or stages of the project and the project’s limitations. It is also the area on which time management and contract administration will be specified.

How Accurate the Scope of Work Needs to Be?

Follow these guidelines to determine if you are preparing or receiving a complete Scope of Work (SOW):

If these items form part of your SOW document, then you are off to a good start, if not, you can be exposed to claims and adverse situations that might affect cost and schedule in your project.

• The SOW identifies the contractor’s responsibilities.
• Provides precisely contract objective and project requirements.
• The SOW provides enough details to estimate labor costs.

Construction Managers

Construction managers head up the construction project. They direct lower-level managers, including construction workers and their supervisors. The Bureau of Labor Statistics states that construction managers make an average of $85,630 per year average as of 2014.

Those in the highest 10 percentile earned in excess of $149,000. The lowest percentile makes just over $50,000.

A solid 50 percent of the construction managers employed in the United States earn somewhere between $60,000 and $110,000 annually. When one looks at those numbers, it isn’t hard to see why this is a very sought-after position. It is also the one on our list with the largest number of opportunities.

Construction Supervisors

Construction supervisors are also known as foremen on the job site. They are on a lower level of management than construction managers but they often share a number of the same responsibilities. Construction managers work closely with labor to ensure that work gets done on time, with strict adherence to all standards of quality and safety.

Most construction supervisors make between 20 and 40 percent less than the construction manager(s) on a given project, although some companies do narrow that gap considerably, especially in circumstances where the work is more hazardous, as supervisors often work more directly with labor than managers and often find themselves further in harm’s way.

Installation Manager

The median salary for a first-year installation manager is approximately $57,730. The actual pay range is somewhere between $39,149 and $82,201, depending on the job and the industry. In some areas, these numbers do increase considerably, so anyone who is willing to relocate for better pay would be wise to explore all the opportunities that exist within this position.

A construction contract provides a legal binding agreement, for both the owner and the builder,  that the executed job will receive the specific amount of compensation or how the compensation will be distributed. There are several types of construction contracts used in the industry, but there are certain types of construction contracts preferred by construction professionals.

Construction contract types are usually defined; by the way, the disbursement is going to be made and details other specific terms, like duration, quality, specifications and several other items.

These major contract types can have many variations and can be customized to meet specific needs of the product or the project.

Lump Sum or Fixed Price Contract Type

This type of contract involves a total fixed priced for all construction-related activities. Lump sum contracts can include incentives or benefits for early termination, or can also have penalties, called liquidated damages, for a late termination. Lump Sum contracts are preferred when a clear scope and a defined schedule has been reviewed and agreed upon.

This contract shall be used when the risk needs to be transferred to the builder and the owner wants to avoid change orders for unspecified work. However, a contractor must also include some percentage cost associated with carrying that risk. These costs will be hidden in the fixed price. On a lump sum contract, it is harder to get credit back for work not completed, so consider that when analyzing your options.

Cost Plus Contracts

This type of contract involves payment of the actual costs, purchases or other expenses generated directly from the construction activity. Cost plus contracts must contain specific information about a certain pre-negotiated amount (some percentage of the material and labor cost) covering contractor’s overhead and profit.

Costs must be detailed and should be classified as direct or indirect costs. There are multiple variations for Cost plus contracts and the most common are:

• Cost Plus Fixed Percentage
• Cost Plus Fixed Fee
• Cost Plus with Guaranteed Maximum Price Contract
• Cost Plus with Guaranteed Maximum Price and Bonus Contract

Cost plus contracts are used when the scope has not been clearly defined and it is the owner responsibility to establish some limits on how much the contractor will be billing. When some of the aforementioned options are used, those incentives will serve to protect the owner’s interest and avoid being charged for unnecessary changes. Be aware that cost-plus contracts are difficult or harder to track and more supervision will be needed, normally do not put a lot of risk in the contractor.

Time and Material Contracts When Scope is Not Clear

Time and material contracts are usually preferred if the project scope is not clear, or has not been defined. The owner and the contractor must establish an agreed hourly or daily rate, including additional expenses that could arise in the construction process.

The costs must be classified as direct, indirect, markup, and overhead and should be included in the contract.