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Metrics and Tools for Construction Productivity Project

Summary:

This project defines metrics, tools, and data for measuring physical infrastructure delivery performance and construction productivity at three levels: (1) task; (2) project; and (3) industry.  The project focus is on how such measures can be developed, how they are related to the use of advanced technologies and construction processes, and how to build on several ongoing collaborative efforts aimed at improving the efficiency, competitiveness, and innovation of the construction industry.  Through these collaborative efforts, this project brings together key industry stakeholders to identify common measurement problems and generate consensus on ways to address key problems.

Description:

What is the problem?  Although the construction industry is a major sector of the U.S. economy, it has experienced a perceived period of decline in productivity[1].  Due to the critical lack of measurement methods, however, the magnitude of the productivity problem in the construction industry is largely unknown.  To address these deficiencies, efforts are underway to measure construction productivity at three levels: task, project, and industry.  Tasks refer to specific construction activities such as concrete placement or structural steel erection.  Projects are the collection of tasks required for the construction of a new facility (e.g., the construction of a new building, bridge, or power plant) or renovation (i.e., additions, alterations, and major replacements) of an existing infrastructure facility.  Industry measures are based on physical infrastructure types published by the Census Bureau and represent the total portfolio of projects.  Producing measures of construction productivity at each level involves the development of both metrics and tools.  Once produced, these metrics and tools will help construction industry stakeholders make more cost-effective investments in productivity enhancing technologies and improved life-cycle construction processes; they will also provide stakeholders with new measurement and evaluation capabilities.  

Why is it hard to solve?  Measuring construction productivity is hard because on the one hand construction industry stakeholders, such as building owners and managers, desire easy answers to complicated questions that are made available through task-level metrics, while, on the other hand, industry leaders, policy makers at the federal and state levels, construction industry researchers/academics, and Bureau of Labor Statistics (BLS) and Census Bureau industry specialists demand complicated data-intensive metrics to assess national and industry-wide trends and challenges facing this critical sector of the U.S. economy.

How is it solved today, and by whom?  The problem is not solved today. There are currently only crude project-level measures and no industry-level measures of productivity for the U.S. construction industry, although limited efforts aimed at this problem are underway in Canada[2] and within the European Union[3][4].  Construction productivity metrics published by the Construction Industry Institute (CII) and RS Means tend to focus on measuring task productivity.  Unfortunately, the current practice for producing these metrics suffers from two serious shortcomings.  First, the published task level productivity metrics do not address changes in technology.  Second, they do not include any means for identifying improvement opportunities.

Why NIST?  The project relates directly to EL's mission to promote U.S. competitiveness in that measures of productivity help managers identify where productivity, and therefore competitiveness, can be improved. It also directly supports the EL vision of our becoming the source of critical solution-enabling tools, in this case improved productivity metrics. The project directly supports the strategic goal of "Measurement Science for Advancing Infrastructure Delivery," and it aligns with EL's core competency "Information, Communication and Automation Technologies for Intelligent Integration of Building Design, Construction and Operation."  Because of EL's unique expertise, experience, and work ties with ASTM, CII, BLS, and Census, it is uniquely positioned to play this leadership role in the development and implementation of improved metrics.

What is the new technical idea?  EL, working in collaboration with CII, has identified the methodology to incorporate improvement opportunities and to address changes in technology releated to task-level metrics. EL researchers have identified two promising metrics for producing a project productivity index. The first is patterned after Teicholz's seminal paper on construction productivity[5].  The second employs a weighting system developed by Bureau of Labor Statistics (BLS)[6].  At a higher level, BLS publishes two common measures of productivity—(single factor) labor productivity and multifactor productivity—useful in estimating an industry-level index. EL economists have reviewed the BLS metrics (both single factor and multifactor) and the data types used in the manufacturing sector. Based on that review, EL has identified a process through which industry-level metrics could, in theory, be generated for each construction industry building type.

Why can we succeed now? The extraordinary national response to EL's critical analysis of the costs of inadequate interoperability in the U.S. capital facilities industry[7] demonstrated the breadth of our potential market constituency. Industry leaders, policy makers at the federal and state levels, construction industry researchers/academics and BLS and Census Bureau industry specialists are today seeking sophisticated, defensible, data-intensive metrics to assess national and industry-wide trends and challenges facing the construction industry. This need is regarded as critical because construction is perceived to be lagging behind other sectors in productivity. EL has the staff capability and industry connections to develop and facilitate through the standardization process implementation of these metrics.

What is the research plan?  EL, working in collaboration with construction industry experts, will produce a NIST Special Publication that describes the benefits of using ASTM building economics standards on a large construction project; an appendix with a proposed classification of bridge elements will also be included. This report will provide the basis for publishing in 2012 an article in an archival journal and a suite of ASTM standards. The proposed classification of bridge elements, once published as a standard classification, will provide the basis for compiling and reporting productivity metrics and cost and delivery time data in the major cost estimating guides (e.g., RS Means). At the October 2010 meeting of ASTM Subcommittee E06.81, EL will outline the proposed standard and seek approval to move forward with Subcommittee balloting. Following subcommittee approval, EL will work with industry experts to address any comments and then prepare a draft standard classification and submit it for subcommittee balloting by the end of FY 2011. EL will continue to work with industry experts to encourage the use of ASTM standard practice E 2691 on how to measure task-level and project-level productivity by adding an appendix covering task-level and project-level metrics. EL, in collaboration with the Construction Users Roundtable (CURT) and other industry stakeholders (e.g., CII, BLS, Census), will form a focus group on the challenges and opportunities for developing industry-level, sector-based productivity metrics. A draft NIST Special Publication will be produced describing a framework for developing productivity metrics for key construction industry sectors. EL will seek content for the report from the focus group, circulate the draft report to the focus group, and convene a meeting of the focus group to gain commitment on a path forward. The report will provide the basis for a draft ASTM standard practice and an article in an archival journal in 2012. EL, working in collaboration with CII, will use the baseline measures for buildings and industrial facilities and data on project cost, schedule, and field rework to identify tasks and processes (e.g., materials tracking) as targets for breakthrough improvements in construction productivity. EL, in collaboration with McGraw-Hill Construction, will produce a report on the challenges and opportunities for increased use of prefabrication and modularization. EL will explore metrics for measuring task-level productivity in a simulated construction activity within the IACJS Testbed and document findings in a white paper. EL, in collaboration with BLS and the Census Bureau, will build on feedback from the focus group and explore ways to use single and multifactor productivity approaches to produce industry-level metrics for construction industry sectors (e.g., office buildings). Multifactor productivity metrics enable separable estimates of the contribution of labor, capital, and technology. The publication of industry-level metrics by 2013 will motivate firms to implement new technologies and processes, thereby both stimulating breakthrough improvements in construction productivity and reducing infrastructure delivery time.

[1] Teicholz, P., "Labor Productivity Declines in the Construction Industry: Causes and Remedies." AECbytes Viewpoint. Issue 4. April 14, 2004.

[2] Canadian Construction Innovation Council, Measuring the Performance of the Canadian Construction Industry, Ottawa, Ontario, Canada, March 2007.

[3] Crawford, P. and Vogl, B., "Measuring Productivity in the Construction Industry," Building Research & Information, Vol. 34, Issue 3, June 2006.

[4] European Communities, The Construction Industry in the European Union, Luxembourg, July 2005.

[5] Teicholz, P., "Labor Productivity Declines in the Construction Industry: Causes and Remedies." AECbytes Viewpoint. Issue 4. April 14, 2004.

[6] Bureau of Labor Statistics, "Chapter 11. Industry Productivity Measure," BLS Handbook of Methods, Washington, DC, 1997.

[7] Gallaher, M., O'Connor, A., Dettbarn, J., and Gilday, L., Cost Analysis of Inadequate Interoperability in the U.S. Capital Facilities Industry, NIST GCR 04-867, Gaithersburg, MD, August 2004.

Major Accomplishments:

Recent Results: Accomplishments in FY 2010 include a partnership with BLS and Census for producing single factor productivity metrics for the construction industry; ASTM endorsement of developing bridge, tunnel, and waste water treatment facility standard classifications; a journal article on measuring productivity in the construction industry; a new ASTM standard practice on job productivity measurement; and development of a measurement science roadmap for advancing infrastructure delivery.

 

Standards and Codes:  Improved metrics will increase the rate of investment in productivity enhancing technologies, including information, communication, and automation technologies, conveying benefits on individuals, businesses, and government in the form of lower costs of building services and products.  The mechanism for getting these standard metrics into practice is to write draft standards for balloting by the ASTM Subcommittee on Building Economics.

Start Date:

October 1, 2011

Lead Organizational Unit:

el

Staff:

Principal Investigator:
Robert Chapman

Co-Investigator(s):
Stanley Gilbert
David Butry

Applied Economics Office

Contact
Robert Chapman, Chief
Applied Economics Office