Partnering - Team Building
WLG has consulted with many corporations, companies, contractors, subcontractors and major suppliers regarding team building, partnering, and Total Quality Management (TQM).
Mr. Walstad is the author of "The Teamwork Strategy", a book on team building within the construction industry, on how to avoid claims and successfully complete projects. His experience around the world uniquely qualifies him as a team consultant and facilitator of partnering. He has received numerous invitations to lecture extensively in the USA and internationally on the subject of partnering and building successful project teams and has conducted many in-house training programs for companies.
You may contact WLG to order Mr. Walstad’s book, "The Teamwork Strategy".
Mr. Walstad is available as a facilitator for the partnering of construction projects. Samples of partnering charters coming out of meetings facilitated by him are available upon request (with names of the project, parties and project-sensitive issues removed).
WLG often recommends partnering as a method for avoiding possible disputes, claims and litigation.Partnering does not always work because of abuses of the process as discussed below; however, numerous projects that have utilized partnering have been completed on time and within budget through utilization of the partnering approach not only at the beginning of the project but also on a week by week, month by month basis.
For those interested in considering partnering on their projects, we are providing the following information.
Partnering
The U.S. Corps of Engineers and the Associated General Contractors and other organizations have urged members to seek "partnering" as a dispute and claims avoidance technique.
This approach, as promoted especially by the AGC is built upon the "3 Cs":
- COMMITMENT
- COMMUNICATION
- CONFLICT RESOLUTION
"Partnering" has been given the following definitions, among others:
- "Partnering is an agreement by two or more parties associated with the design and construction of a facility to work together toward a successful project in which their mutual objectives are accomplished in a non-adversarial atmosphere." (AGC of America – "Implementing Partnering")
- "Partnering is the creation of an owner-contractor relationship that promotes achievement of mutually beneficial goals. It involves an agreement in principle to share the risks involved in completing the project, and to establish and promote a nurturing partnership environment. Partnering is not a contract agreement, however, nor does it create any legally enforceable rights or duties. Rather, Partnering seeks to create a new cooperative attitude…. To create this attitude, each Party must seek to understand the goals, objectives, and needs of the other – their "win" situation – and seek ways that these objectives can overlap." (US Army Corps of Engineers, Partnering, ADR Series, December 1991.)
The key elements of Partnering are:
- Commitment From Top Management
- Equity – Consideration of Stakeholder Interests
- Trust Between Team Members
- Development of Mutual Goals and Objectives
- Implementation Strategies
- Continuous Evaluation
- Timely Responsiveness
Through a "Partnering Meeting" early in the project, the team members seek to:
- Become oriented regarding the project
- Identify potential issues
- Identify alternative solutions
- Harmonize Objectives
- Development a Partnering Charter
- Train team members in partnering
During the course of the project, the team seeks to:
- Implement Charter provisions
- Make a measurement of partnering at weekly meetings and through a monthly facilitation meeting
- Provide for rewards and recognitions for those contributing to the process
The Partnering Charter
The following is a sample of a Mission Statement developed during the overall discussion of a Partnering Charter:
Sample Partnering Charter
PROJECT: _________________
March _____, 200_
OUR MISSION STATEMENT
Knowing our project is unique and enjoys high visibility within the community, state and nation, we want a quality design and construction which meets or exceeds the applicable standards, customs and practices, with high quality drawings which will support an on-time, on-budget completion.
This project will be an enjoyable experience for all, which continues or builds long-term relationships at all levels. We will achieve a clear understanding of the facility and the User’s needs.
Our project team will benefit from good communications among ourselves, and with the public and donors, being always aware of our need for their support and cooperation. We will have trust and confidence in each other and appreciate and respect the expertise of each other and the strength each of us bring to the Project.
We will work efficiently together in a safe environment, effectively communicating and working in a cooperative manner, understanding and respecting the expectations and needs of others and the times required for delivery by each of us of our scope in order to not impede the work of others.
Our Project will have good site access, and we are prepared for the possible need to employ additional shifts or to make other reasonable schedule accommodations.
During the Project we will seek to identify problems and resolve them before they grow larger. We will work together to find solutions for unforeseen challenges. The client and user will be informed in a timely manner of any challenges during the design and construction processes and will be part of any solutions. We will avoid unreasonable changes or surprises.
Our team will finish on time and on budget. To accomplish this we will work for a timely and effective start up and close-out of the facilities and turn over to the user. We want the job to be successful, a best value within the budget, and a financially rewarding enterprise for all.
OUR PLAN FOR IMPLEMENTING PARTNERING
[The Team Sets Forth Their Plan of Action Here]
[All the Parties to the Partnering Meeting Should Sign the Charter]
We the undersigned agree to make a good faith effort to undertake and implement this PARTNERING CHARTER, as applicable to each of us, understanding that this Charter does not amend our contracts on this Project.
Signed this __ day of March, _____:
| OWNER ___________________________ ___________________________ ___________________________ |
CONTRACTOR |
| OWNER PROJECT TEAM ___________________________ ___________________________ ___________________________ |
DESIGN A/E TEAM ___________________________ ___________________________ ___________________________ |
SUBCONTRACTORS: |
___________________________ ___________________________ ___________________________ |
"FACILITATOR" Paul J. Walstad |
Teaming Arrangements in Public Contracts Differ Greatly from Partnering
The Federal Acquisition Regulation (FAR) Subpart 9.6, Contractor Team Arrangements, describes contractor team arrangements as follows: "Two or more companies form a partnership or joint venture to act as a potential prime contractor"; or "A potential prime contractor agrees with one or more other companies to have them act as its subcontractors under a specified Government contract or acquisition program."
"Teaming arrangements are desirable from a federal and industry standpoint because they enable the companies involved to complement each other’s unique capabilities and offer the government the best combination of performance, cost, and delivery for the product being acquired." (http://www.sba.gov) One good source, among many is also the book: Mutek, Michael W. (2006). Contractor Team Arrangements--Competitive Solution or Legal Liability. American Bar Association. (pp. 8-13)
Partnering is thus an informal process through which parties, already under separate contractual obligations to one another, meet together to seek common goals and a plan of action to carry out those goals consistent with their contracts.
Teaming arrangements, on the other hand, may be governed by the FAR and are much more binding and are of the character of a partnership or joint venture agreement.
The practice of collaboration between businesses on government contracts is quite common. Traditional subcontracts involve an agreement in which one company goes after a contract and then subsequently awards a portion of the work to another for performance. Teaming agreements, on the other hand, involve two or more parties agreeing to jointly pursue a contract or group of contracts. (http://www.fedaccess.com/subcontracts-teaming-agreements.htm)
Partnering Does Not Relieve Contractual Obligations Or Confer Additional Rights
As set forth in the above sample partnering "Charter", the parties at any partnering session should understand and be clear that their "agreement" and "charter" coming out of the process does not change their contractual obligations or confer additional rights outside of the contract. For example, Mr. Walstad, in facilitating a partnering meeting, adds the following paragraph above the signature lines of the team: "We the undersigned agree to make a good faith effort to undertake and implement this PARTNERING CHARTER, as applicable to each of us, understanding that this Charter does not amend our contracts on this Project."
In some cases, Mr. Walstad has found that the Partnering Charter does reflect matters or points not specifically addressed by contract; if so, he has recommended, and at times even included the statement in the charter itself, that the parties will consider changes to their formal contract to accommodate certain specific matters raised in their partnering charter.
For example, if the parties realize during the partnering process that the completion date or milestone dates are unrealistic, the contract could be changed to reflect more reasonable dates; and appropriate consideration should be given to possible adjustments in terms of time and money which such completion date changes may necessitate. Additionally, if parties during the partnering process discover that the drawings or specifications contain flaws or errors, Mr. Walstad has recommended that the parties negotiate formal changes to their contract to resolve these technical issues. In this way, possible claims or disputes in the future may be avoided.
It is interesting to note that in the case of Helix Electric, Inc. v. US, 68 Fed. Cl. 571 (2005) the contractor argued that certain rights in a separate CATV franchise contract arose because, among other things, during a partnering session relating to an electrical distribution contract at the Keesler Air Force Base, the contractor and government had discussed the potential CATV franchise. Helix brought suit against the United States claiming that the contract for replacement of an electrical distribution system at an air base, gave it the right to become a cable television operator on base and that the contracting agency breached its implied duty to cooperate and not hinder that aspect of performance. [The case is sparse as to the importance of the partnering meeting, but it does imply that the discussions between the contractor and the government, during the partnering meeting and at other times, did not confer the CATV franchise contract upon Helix, even though during these discussions the Navy may have misled the contractor.]
In Klickitat County Public Utility Dist. No. 1 (KPUD) v. Stewart & Stevenson Services, Inc. (S&S), Slip Copy 2006 WL 908042 (E.D.Wash. 2006), the court held that the pre-bid partnering agreement was not enough to bind the contractor to guarantee certain work that was performed without a specific guarantee being in the contract itself.
Partnering is not an excuse for not performing in accordance with the contract or for not complying with the contract terms. Some who have tried partnering complain that it didn’t work. This may be the case if the facilitator failed to bring the parties together in their minds as well as on paper. Another serious complaint has been made that some parties utilize the "partnering relationship" as an excuse for denying legitimate claims or as excusing nonperformance of their contractual and legal obligations. The only way the process will work is if the parties are committed to it, ensure their communications are open and that conflicts are resolved day to day and week to week on a fair and sound basis (again, the "3Cs" as discussed above).
Abuse of the process can result in its ability to be an effective tool for encouraging parties to work together. Partnering is a continuing process throughout the period of performance and should be a part of job meeting discussions. In a sense, the commitments made during the partnering process can be re-emphasized, and the parties can seek a resolution regularly of difficulties facing their team, without the threat of claims and litigation