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November 07 Businessexcellence 59 a tremendous amount of intelligence gathering, research and creativity that goes into these presentations to win the job. It’s become a major part of our business; I spend a considerable amount of my time overseeing our response to submissions, choreographing presentations, and gathering information by talking to clients to understand their needs and their hot buttons.” Where has the term “construction management at risk” come from? Traditionally, general contracting used the hardbid process, and anybody could bid the job as long as you could show up with a payment and performance bond and meet the requirements of the bid package. Selection was made on the basis of the lowest price. “Many school districts and municipalities saw the consequences in that delivery approach, such as the winning contractor not meeting schedules, producing poor quality work, and having contentious relationships, because in that scenario, the contractor only bid on what he saw in the plans and specifications. If he tried to read between the lines for details, he would add too much to his bid and not be competitive enough. So you were forced to bid only what was on the bid documents. And if something else was missing or required, he could say that it wasn’t on the drawings, and would request a change order. That put the architect in a defensive mode, because the owner would ask why the detail wasn’t clear or complete. So you had a cat fight going on, and at the end of the day, no one was happy.” With construction management in its purest form, called “pure agency CM,” the construction manager has no risk, is simply an agent of the owner, and is paid a fee to manage the construction process; and the subcontracts flow directly to the owner. The hybrid of these, which has become the preferred delivery method in the industry, is construction management at risk. The construction manager is typically hired at the same time as the architect, at the conception of the project when there’s no design. They work together to design the project as cost-effectively as possible, to keep it within budget and on schedule. “We comment on what elements might be missing,” he says, “and we work together as a team. When the plans are at the point where they’re considered bidding documents, we bid W.G.Mills “I spend a considerable amount of my time overseeing our response to submissions, choreographing presentations, and gathering information by talking to clients to understand their needs and their hot buttons”

60 Businessexcellence November 07 it out competitively at the subcontract level, then as a team we put together a guaranteed maximum price, and that’s where the risk portion of construction management occurs. The owner/construction manager contract provides that the construction manager contract with all the subs, and they guarantee a maximum price to the owner, but work typically on a fee or lump sum basis, and if there’s a difference between the guaranteed maximum price and the actual cost of the work plus the fee, it’s either returned to the owner or there’s an incentive clause that shares it with the construction manager.” Currently under construction is Riverview High School in Sarasota County, near Mills’ corporate headquarters. It’s one of the company’s most ambitious educational projects yet, slated at $95 million. With 421,659 square feet of fl oor space, it’s designed for 3500 students, larger than a normal school. The modern glass-and-steelexterior building is being constructed adjacent to the standing structure, built in 1958, where classes continue as usual. Despite the large size, the concept is “small learning communities,” a kind of school-within-a-school program in smaller classrooms that focuses on career goals, and where students remain in a cluster for the entire school day (a contrast to traditional academy style learning with separate buildings for the individual disciplines). Hensey is optimistic about the future for Mills, and the company is considering expansion to southern Georgia and Alabama, with their lower property taxes and values. “One way to grow your company is to fi nd a project in a new area, relocate a project team there, and discover a viable construction market worth developing, then open a new offi ce there. So we’re excited about future opportunities.” W.G.Mills