Biz New Orleans Article

What’s the Plan?

A commercial general contractor shares his views on the pros and cons of “back-of-the-napkin” sketches.

 

 

I’m the owner of a small commercial New Orleans general contracting firm and now and again, I get asked what I like about my job. My response is something along the lines of how I like all the different personalities that comes along with doing construction business. I especially like the challenges inherent in communicating with them all. In other words, I must successfully get through to the grumbling ditch-digging plumber in the dog heat of August and then an hour later convince the manicured developer’s banker to see my point of view.

The personalities run the gamut, and I like wearing the different hats. This sentiment is, no doubt, shared across countless industries. The important part of it for me, as a business owner, is the effective communication part.

As a small commercial contractor, I am obliged to chase and secure business that sometimes begs for effective communication. What happens is that scope of work definition can sometimes be unclear. Much of our work — just as, I imagine, much of my competitors’ work — falls into this grey area of scope definition.

Often, clients come to us with sketches in lieu of architectural plans, underdeveloped plans (plans ready for permit but not much else), written scope sheets or marked-up real estate marketing material. If we establish the premise that good architectural plans equal scope definition, then good architectural plans mean effective communication.

Now, it would be all good and well to eschew the clients with back-of-the-napkin sketches and only seek work with fully-developed, coordinated stamped drawings, full specifications and a few nice renderings, but then I would eschew more than half of my client base. On top of that, most of these clients are a delight to work for, and conventional scope definition must be attempted to established by other means.

But forget the “can-do” attitude for a minute and think of the last project you had with your contractor (residential or otherwise). Was your project small enough that it didn’t necessarily warrant a full set of architectural plans? In a way, that’s a good, economical approach to starting a small project. Did you seek competitive bids? How so without plans? Did the cheaper contractor have you covered? Did the more expensive contractor provide good coverage but interpreted some scope too broadly (read: expensively to cover him or herself)? Did the permit process go well? Were there many dreadful change orders?

Ok. Before this turns into a gripe-fest, let me say again, that often projects with “light” plans can go really well — the client is happy, the contractor is paid, you get the idea. But are there other effective means of communication that can develop an airtight scope of work definition?

In my experience, it is most helpful to share with a client an itemized list or budget and (hopefully they read it) during bidding and throughout the work. I think this is probably how work normally is accounted for in residential projects. An itemized budget in commercial work is helpful to be sure, but still can leave room for interpretation — it is written by the contractor after all. Meeting minutes help (again, typically written by the contractor). Inclusions and exclusions on a proposal are written by the contractor. Certain types of contracting (Cost Plus/Open Book) may not define scope exactly, but certainly can provide accounting information.

I wonder if it’s impossible sometimes, but I certainly can’t and won’t stop trying to help the “napkin sketch” client. Even to call them that dismisses what two parties can accomplish if they agree on the contents of the napkin.

My company has successfully completed more than a few Magazine Street boutiques, Metairie office renovations, French Quarter condominiums and common area improvements, medical and wellness centers re-dos, even HGTV television shows on light drawings or no drawings at all. Most are for repeat and/or satisfied clients.

We have also successfully completed competitive work for customers who have commissioned full, coordinated sets of plans, and even those projects were not without construction or communication issues. Every project (good plans or bad) has construction and communication issues. As a commercial contractor familiar with working a project both ways, I admit that it is preferable to have a decent set of plans.

Here’s the Goldilocks moment though: Good plans can yield a higher bid from my office (to account for everything). Good plans mean a level playing field for bidding contractors but may sticker-shock a client.

Bad plans can yield one of two things from my office: 1) a high bid (to assume to account for everything) or 2) a low bid that may leave the client without coverage of scope (by assuming too little).

Recently, my company dealt with a scope definition issue at a project in Uptown. The project was mainly a finishes renovation for a commercial facility. The contract was based on a marked-up floorplan and a set of owner-provided notes. We either misinterpreted an item on the notes or were unclear in our inclusions/exclusions regarding a minor finishes item that the owner expected.

Now we have to talk about money. Money is lost in a situation like this. So…what to do? You can’t rely on a “what we talked about” recall of a conversation. You can build a case for your point of view; you can review the documents you do have; you can fuss and fight; you can acquiesce, take the hit and get the job done. Our course of action in this situation was to defer to the relationship we have or are establishing with that owner. It usually boils down to that anyway, doesn’t it?

At my company, my staff and I will talk about lessons learned. We will always try not to avoid a trap we’ve fallen into before. I certainly will not be walking away from clients with light drawings. I think we excel at projects with light drawings oftentimes.

If there is a lesson to be learned, then the lesson is a “get on the same page,” “everything in writing” kind of lesson. Those are platitudes and those are impossible. The next best thing is never to stop trying for effective communication.


Ryan D. Mayer has been in the commercial construction industry for over 16 years. After 7 years in commercial construction in Manhattan, Mayer moved home and started Mayer Building Company in 2009. MBC is a New Orleans builder and general contractor offering commercial construction, historic renovations and specializing in office, retail, medical facility and restaurant build outs.

Posted on 31,Aug | Posted by rmayer