The Value of Upfront Consultations with Experts

As promised in our last issue, this month’s discussion explores the value of consultations with experts and the myriad of problems that can occur when work is performed without proper permits. Let’s first define “Authority Having Jurisdiction.” Simply put, these are the entities that make the rules for a geographic area.
Following the rules is a far more involved (some say complicated) process than some choose to go through. One of the difficulties is that the rules for following the procedures in place for any given area may differ significantly from an adjacent geographic area. There is a myriad of reasons for the differences, which are not always clear to the public.
Like most rules for any organization, they can be based on:
  • Past experiences
  • Financial reasons
  • Demographics
  • Logistics
  • The spatial organization of the jurisdiction
  • And a host of other variables that contribute to the uniqueness of that area.
Above all, most of the regulations are put in place to protect the general public from the contractor’s errors and prevent the contractor from making errors that may be dangerous to the public.

The Division of Building Safety and the Fire Marshall’s office are often seen as entities that cost business owners and homeowners money. Quite the opposite is true. While some disagree with how the rules are interpreted, derived, and even implemented, that is fodder for another discussion. Today, we deal with following the rules in place and why following the rules is less costly in the long run.

Let’s look at one case scenario for a commercial building. A business owner occupies part of a warehouse-type building.

The business is rapidly growing, and the remainder of the building becomes available for lease. The business owner and building owner strike a deal and sign a lease for the business owner to take over the rest of the building. Without permits the business owner makes “improvements” to his added space to include new equipment for his operations, structures for new equipment, openings in the walls between the units, even a new overhead door in the building structure. A friend who is an electrician adds another circuit breaker to the electrical service and the business has grown so much that the business owner has hired ten new employees. All of these improvements “had to be done” but hiring an Architect, Structural Engineer, Electrical Engineer, obtaining plans, hiring a contractor, getting inspections on the new work would “cost too much” and “take up valuable time.”

The business owner is now operating at double his capacity and everything seems to be fine. Then the Fire Inspector comes to the building to perform an annual inspection. The fire inspector notices several items that require correction. The building owner doesn’t take care of these items right away so when the fire inspector returns (standard operating procedure) and sees that the corrections were not made, the Building Department is notified, and a building inspector visits the building. The building inspector observes some “improvements” that do not meet current building codes and are potentially unsafe. He makes a note of the items and upon searching the building’s records, sees that permits have not been obtained for much of the observed new work. Here is where the situation grows exponentially worse.

Because of the code violations, the Fire Marshall and the Building Inspectors perform a more thorough inspection. This produces a much more extensive list of violations that are now recorded. Some are new and some may have existed before this business owner leased the space. A timeline is given to the business owner to correct the violations. The business owner will now be required to submit a Permit application with signed, sealed plans drawn by a licensed architect and appropriate Engineers or risk closing the operation entirely.

Some additional time lapses because the building owner cannot find the time to address these issues, which he knows will interrupt his business and likely cost money that has not been budgeted. The Building Official and Fire Marshall return to the building, observe that the requested corrections have not been made, and some additional work has been performed without a permit since the last visit. The Building Official and the Fire Marshall decide (rightfully so) that there are enough unsafe conditions that they shut the business down completely.

While this is an extreme case scenario, what was likely a few thousand-dollar problem, has now become a tens of thousands of dollars problem, including:
  • The loss of work for dozens of employees
  • Loss of revenue for the business
  • Interruption for all the other companies that counted on the goods and services from this business.

Even if the building was not declared unsafe by the authorities having jurisdiction, the unsafe conditions might have eventually caused a severe preventable injury to one of the employees, which cannot be “fixed” with money.

While this may be an extreme case, many examples of the unexpected cost of doing work without permits or licensed contractors exist every day. We cannot put a dollar value on someone’s life and well-being, be it an employee or the general public. Once an injury or death occurs, it cannot be reversed. Architects and Engineers are educated and licensed to design buildings and workspaces that are safe for all. Building Codes and Permitting regulations are in place for the safety and well-being of employees and the public.

Contractors are licensed to work with these Architects, Engineers, building officials, and Fire Departments and are responsible (morally, ethically, and financially) to provide safe work and living spaces for all. While saving a few dollars and some time may appear to be the best route to take and may provide a short-term benefit, the long-term consequence could mean the loss of life and less importantly, exponentially more expensive to correct the problem. Unlicensed work and unpermitted work are always more expensive (figuratively and literally) in the long run.

If you are unsure of whether or not you need a permit, consult a licensed professional.

Has the Homework Been Done for Your Project?

Has all the homework been done to make your project’s foundation as strong as it could be?
  • Has the surveyor communicated with the title company?
  • Has your client communicated with their landlord?
  • Have the designers communicated with all of the Authorities Having Jurisdiction?
  • Have the designers collaborated with the major subcontractors?
  • Has your General Contractor reviewed all of the information provided, double-checked what has been provided, and asked the questions about ambiguous information before commencing with the work?
If you have reached the point where you think your General Contractor is ready to commence construction, the most critical question is, “Are any assumptions being made?” Assumptions lead to misinformation, miscommunication, finger-pointing, and ultimately deteriorated relationships across the board.

While the bottom line is an essential consideration of any project and any business, it is not the first one with Tri-Bay Construction. A project built on a solid foundation followed by a strong collaborative and cooperative effort from beginning to end makes the bottom-line almost academic. Utilizing the experience all parties have is an integral ingredient of a strong foundation. As discussed last month, after each project’s end, we review all phases of a project and identify its strengths and weaknesses.

We build on the strengths and look to improve on the weaknesses. In our experience, we have found the majority of the failings begin before construction.

Because of this fact, we strive to improve the pre-construction services we offer to every client.

No one entity involved in a construction project, be it large or small, is more important than another.

With this philosophy, Tri-Bay Construction provides buildings, tenant improvements, remodels, upgrades, and most importantly, relationships that are BUILT TO LAST.

The Importance of an Administrative Foundation

This month’s discussion will focus on the importance of foundations when ready to construct a building. Our focus is not on the building’s concrete foundations but instead on the foundation before the foundation.
There is an administrative foundation before construction that, if not prepared thoroughly, can become catastrophic. No matter how the crack in this foundation is discovered, it is usually expensive and sometimes worse than anticipated. This is an often overlooked part of building construction, as is the operation and maintenance of a building, whatever its use is or will be.
Before construction plans have begun, some preliminary items must be investigated and documented first. To follow are just a few items to consider:
  • Surveys of the property
  • Zoning of the property
  • Occupancy and Use of the building
  • Rights-of-way
  • Easements
  • Liens
Whose responsibility is this? This question has various answers among different people. Some have a portion of the needed information, and others don’t have any of the required information. Some of these items fall under the umbrella of pre-construction services, and some do not. What is included in “pre-construction” services must be clearly defined.
While we want to believe that we have all of the information and that spending a small (in comparison) amount of money for these services is an unnecessary expenditure, making that decision can turn into a colossal error in judgment.
Case in point: The property owner hired a design team after the purchase of a property which was assumed to be correctly surveyed and investigated for liens, encumbrances, easements, utilities, zoning, etc. Then the design team took over and began drawing plans, defining applicable zoning and municipal ordinances, and clarifying jurisdictions of the various portions of the project.
Based on the information provided, the design team assumed all investigative work had been complete. Plans went through the Plan Review process in all three jurisdictions. All parties involved stamped the plans approved for construction, assuming all of the preliminary investigative work had been thoroughly completed.
Having approved plans for construction, the selected General Contractor commenced building a construction team of suppliers and subcontractors. In the bidding process, all subcontractors, suppliers, and even the General Contractor assumed that all preliminary work was complete and the project was ready for construction.
Having built a team and contracted with selected subcontractors, the General Contractor mobilized and went to work on the project. One month later, the adjoining property owner declared there was a parking easement recorded and that the construction seemed to be encroaching on that easement.
The moral of this event is that proper preparation should never be based on assumptions. The most important lesson in this scenario is that a small investment in pre-construction services could be worth more in the long run than the expenditure of the entire project.
The project could depend on a qualified, experienced contractor who is willing to go the extra mile for the sake of the client and all of the people who will be involved in the project. Had the design team communicated with all of the separate entities before sending the project out for bidding, the results may have been different.
Utilizing a design-build, integrated project delivery method or pre-construction services provides more collaboration and communication and fewer assumptions. Knowing that another set of eyes is paramount to a strong foundation for any project is priceless to all involved.
Next month we will explore the value of consultations and collaborations in those areas where others have more experience and expertise before taking action on any construction project.
We will discuss the dangers of saving a few dollars by not obtaining permits and the effects those decisions have financially and, more importantly, on the life safety of the people those decisions affect directly and indirectly. Preparing properly to leave positive ripples costs less in the long run.

A Family-Owned Business Empowers It’s Team

How would you answer these questions?
  • Is there an advantage to working with a family-owned business?
  • Is there an advantage to working with a smaller company?
  • Is there an advantage to working with a company that has a lot of repeat business?
  • Is there an advantage to working with a company with high internal organizational trust and long-term subcontract relationships?
If you answered “yes” to all of the above, you are correct. As a family-owned business, every employee has a common interest. Tri-Bay is family-owned in two ways.
  • Immediate family members hold key management positions.
  • Field personnel and management have 20+ year relationships. They are family also.
We work as a cohesive team, and information is shared freely among family members, so there are no secrets about our business. This creates an internal environment of trust and confidence in decision-making and the common goal to grow the business. Every one of our management team is empowered to make decisions based on what is best for our clients and our business.
As a small company, our clients and subcontractors still receive individual attention. Management is not separated from clients after a project starts. In our technological world, personal interactions seem to be waning, and reliance on electronic communication continues to rise. Face-to-face and person-to-person contact fosters trust that an email or text cannot accomplish.
Our subcontractors trust us (external trust), and we trust them because we see and work with them regularly. Consistency breeds trust between subcontractors as well. When tradespeople recognize the same faces from project to project, a relationship develops, egos are put aside, and an environment of mutual respect is developed. Information is shared more freely, which breeds efficiency and productiveness. Our clients benefit from these relationships, which fosters recommendations and future work.
A company with repeat clients clearly demonstrates that the Contractor is trustworthy, skilled at what they do, and provides the client with what they need every time. When we complete a project, we do a completion review (post-project) with our subcontractors, the designers, and most notably with the client. Our client’s feedback is what allows us to improve with every project. 
No construction project is perfect, nor is it accomplished error-free. When we review a completed project, we want to know what we did well, but we also want to know where and how we can improve. If your Contractor is not doing this, you will likely not refer them to your friends and colleagues.
Do you trust your Contractor? What we sell is a service, not a product. Without trustworthy people, there is no good service.

The Importance of Trust

Last month we discussed “What to Look for in a Contractor When Planning a New Project.” This month, we will explore that in a little more depth, emphasizing the importance of trust and how trust between all parties is essential throughout a successful project.
“Trust” is an integral component of the construction industry, not just the “buzzword” it has become in the business world. A construction project (small or mega-large) represents a considerable investment in time and money for any client project type.
  • Public or private sector.
  • TA tenant starting a new business.
  • Municipality constructing a bridge and a new eight-lane highway.
Every client makes an investment, signs a contract with a General Contractor (GC), and then needs to trust that the Contractor they selected will provide the expected outcome.

Construction is an industry where numerous companies (people) are thrust together in one location daily. They are there to meet a common goal (for someone else) and together to meet it efficiently, on time, and within budget. They are asked to do this quite often without ever having met each other, much less having worked together. A daunting ask. Would you have a deeper level of trust in your General Contractor going into the project, knowing that they have a strong relationship with the subcontractors because they have a proven track record of working together? There is an immense difference between a contractual relationship and a personal relationship.

A contractual relationship by itself does not require trust. Terms are defined, scopes of work are explained, and procedures to handle every situation are spelled out. As long as we both sign the document (and it is a well-written contract), trust doesn’t enter the equation. On the other hand, a personal relationship is based on trust and, in conjunction with a contract, becomes a formula for success.

A relationship based on trust doesn’t need a contract except in rare circumstances. The contract becomes a “fallback” document if something goes wrong and the two parties cannot agree on a solution.
Let’s explore some qualities that foster trust and the impact various levels of that trust have on a project’s outcome. When subcontractors know what to expect from a General Contractor, and the General Contractor knows what to expect from subcontractors, there is a mutual benefit to the client and all personnel involved. The project will be completed quicker, and each day brings a higher level of productivity and levels of collaboration. The more communication and collaboration between subcontractors, the fewer mistakes are made. Less work needs to be re-done ($) because one subcontractor wasn’t thinking about where the other subcontractor’s work overlaps his. For example, if the electrician is not communicating with the cabinet installer, we may wind up with a receptacle covered by a backsplash.
The “lowest bidder” comes into a job with a lower level of trust before they even start a project, as the GC is wondering why the bid was so low. The Superintendent is at a distinct disadvantage because they don’t know who they are working with, their skill level, communication skills, or how they will interact with the other subcontractors.
The subcontractor has little trust in this Superintendent because in the last project he worked on, the Superintendent lied to him, belittled him, etc., so, in his mind, all Superintendents are the same. Building a relationship takes time.

Consistency is a quality of trust that seems academic but unfortunately not easily found. If a person always does what they say they are going to do, trust increases. Trust builds teamwork.

Familiarity is a key to building trust and teamwork. When subcontractors work together on multiple projects, relationships are formed and strengthened as the goals become equal. Helping one another is easy when there is trust and a team atmosphere. Multiple perspectives amongst trusting peers bring faster solutions and require less money and less time.

One of the difficulties found in Design-Bid-Build projects is that the collaboration between GC, Subcontractors, Clients, and designers rarely exists and doesn’t have an opportunity to grow, thereby reducing the level of trust (i.e., between subcontractors and designers). If there were direct contact, such as in Integrated Project Delivery, the trust between the Architect and the subcontractors is being formed from the start, and the collaboration flows through the entire project, not just when there is a problem.

When there is a centralized data system, and everyone has access to the same information simultaneously, there is less room for finger-pointing. Every member of the team has to take equal responsibility.

The chances of conflicting sources of information are reduced, and members of the team trust that everyone has the most recent data.

Trust requires fostering an atmosphere of personal responsibility and mutual respect. When I make an error, it is essential to own it and not blame someone else. Everyone involved now knows that integrity is present. Building a relationship in the field (external trust) also requires trust inside (internal trust).
When subcontractors witness the relationship between the field Superintendent and their office and see that information flows freely, timely, and accurately the subcontractors then know they can trust the Superintendent because of how others trust him/her.
And finally, as customers become more committed to your organization, their behavior progresses from recommending your services to others and resisting competitor’s approaches all the way to paying a premium to do business with you. Taking a risk on a newcomer becomes less attractive. Customers know the outcome to expect when they work with you. This will create more business. With repeat work, you develop a deeper relationship, and through that relationship, you build even more trust, making the work more enjoyable.
And as we know, if you enjoy what you do, it isn’t work!
In future issues, we will discuss why greater trust leads to better performance on every project.