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Introduction

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To ensure an institution’s physical plant is most effectively carrying out its mission, how the services that are needed to carry out that mission are delivered should be thoughtfully considered. Economic forces, business cycles, technological and labor market changes, as well as external and internal factors, create a constantly changing environment that affects the delivery of professional architecture, engineering, and construction (AEC) services. The powerful inertia of doing business the way an institution always has must be countered with strong, forward-looking leadership, as well as candid internal examination of the institution’s operations and culture.

A variety of avenues exist to provide the AEC services needed to plan, design, construct, operate, and maintain an institution’s facilities. Broadly, these avenues can be divided into being provided by in-house or out-of-house forces. To aid in considering how AEC services are provided, this chapter will discuss several facets of providing AEC services via in-house resources. It will focus on design and construction services instead of similar but somewhat different services oriented toward operating and maintaining facilities.

All activities performed within an organization’s umbrella must connect either directly or indirectly to the mission of that organization.

The services to be provided must be necessary to support that mission or they should not be provided. But simply because they are needed is not sufficient justification by itself to provide them via in-house resources.

In addition to contributing to the organization’s mission, in-house resources should provide added value beyond what external resources can provide. Otherwise, the justification for using in-house resources is diminished. Taking into account the several advantages and disadvantages of using in-house resources is important as well.

Mission, value, advantages, and disadvantages comprise a broad framework for deciding whether to use in-house AEC services. The spectrum of project sizes and types to be undertaken, the disciplines comprising the services that are offered, the nature of the customer base, and external competition are additional factors that set the parameters within which in-house AEC groups function.

All organizations are driven at some level by financial considerations. The financial viability of in-house AEC groups—to whatever level is considered acceptable—needs to be established. Furthermore, an effective and efficient organizational structure will promote financial viability and the units’ ability to carry out its mission. Finally, to gauge if and how effectively a unit is carrying out its mission, performance metrics must be established.

Organizational Mission

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When considering starting in-house design or construction groups, start with a review of the organization’s mission to ensure that establishing an in-house design or construction group contributes to achieving that mission. In the absence of a well-defined mission, or a specifically worded mission, the organization should determine how having an in-house design group would help better deliver its services. Beyond providing a common rally point for an organization’s activities and direction, a mission serves as a check on the activities that are undertaken. Every activity that is done needs to contribute to accomplishing the mission. If an activity does not contribute to carrying out the mission, either the mission should be changed or the activity stopped.

A unit’s mission must contribute to the mission of the larger organization or institution that the unit is part of, or be a subset of a parent unit’s mission. For example, if a physical plant’s mission is “to provide excellent facilities,” an in-house design unit’s mission could be to provide excellent architectural and engineering services to the physical plant in a timely and cost-effective manner.

A too broadly worded mission—for example, “to improve the university”—could be interpreted as encompassing just about any activity one can imagine. At the other end of the spectrum, a too narrowly defined mission—for example, “to construct small renovations”—may limit creativity, innovation, and growth.

An in-house design group’s mission must align with the mission of the in-house construction services unit’s mission and vice versa if they are to work together effectively on the same projects. The culture and processes of an in-house construction unit whose mission is focused on, say, small-scope, reactive, urgent work will not align well with those of an in-house design unit whose mission is oriented toward planned multidisciplinary projects with multi-month schedules.

This mission vetting analysis is performed independently of consideration of the mission’s financial or economic viability. This is not to discount the importance of the mission’s financial viability but rather to emphasize that they are equal and independent analyses. In other words, the analysis of whether something should be done (i.e., whether it contributes to the mission) is independent of the cost of doing it.

Recognizing a Need

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The establishment of the mission will lead to considering to what degree that mission is currently being carried out. This analysis will reveal the gap between the desired mission and current efforts. This gap constitutes the need. The gap could be caused by deficiencies in any of many possible diverse components such as expertise, personnel resources, funding, leadership, soft skills, culture, or a multitude of other characteristics of varying quantifiability.

A consideration of the local external AEC market’s ability to fill this need is important. In-house services will compete with local external firms. The strength of the local market in terms of the number of competent AEC firms and personnel to perform the work, as well as the volume of work available within the local economy, will affect the external market’s ability to fill the gap. External private-sector market conditions are more dependent on local and regional economic factors and so tend to oscillate between greater highs and lows than those experienced by institutions such as government agencies and universities. For smaller institutions, it may not be initially financially viable to maintain internal personnel to provide specialty services that are needed only occasionally. Services related to highly specialized areas of engineering and construction expertise such as hazardous materials or geotechnical solutions are examples. The capacity and availability of firms within the local market to provide these services factors into considering whether to staff them internally. Projects and initiatives may not be able to be advanced without the needs associated with these relatively small-scope areas being filled by someone, whether they be in-house or external.

An institution may have its own unique facility programs and initiatives leading to high concentrations of needs specific to that institution’s mission and operations. These needs benefit from having permanent in-house expertise to promote a consistent approach to issue resolution, renovation, maintenance, and operations. In-house expertise could encompass specific technical disciplines or usage categories. Examples of technical areas include elevators, roofing, structural inspection, and asbestos mitigation. Usage categories could include athletic facilities, agricultural facilities, security, residence halls, and dining facilities. These usages may have unique needs requiring even more specialization. For example, Division I college athletic programs that have broad public visibility on a national scale require high-level design capabilities that are impractical to maintain on a permanent in-house basis.

A natural progression of in-house design and construction groups is to originate as on-call repair-oriented support functions then progress to a maintenance function and finally to evolve to providing multidisciplinary AEC services designing and building new construction and renovations. Many factors play into this evolution, but it should be strategically planned instead of being allowed to grow unchecked organically. A thoughtful approach to the mission and needs will inform the decision and manner in which to initiate and evolve.

Value--Justification for the Organization

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Justifications for standing up in-house AEC groups center around mission – as previously stated – and value. The capacity and competency of outside professional architecture and engineering consultants and contractors to consistently deliver quality AEC services must be considered, as they are essentially competition.

However, value and cost are not the same thing. The value of the services provided by in-house AEC groups must at a minimum be comparable to or preferably exceed the value provided by outside AEC firms. However, much of the value that in-house AEC groups provides may be intangible and not easily quantifiable. Because of this, “value” as a component of the business case for justification can mistakenly be diminished or discounted.

Typically, within a geographic area, several AEC firms exist that can provide comparable technical expertise and services. Value decisions based only on a comparison of hourly billing rates by private AEC firms against the hourly rates charged by in-house AEC groups fail to consider the substantial added value that in-house AEC groups can contribute. Components of this value include the following:

Shared Mission. Both in-house AEC’s and their internal customers presumably share the same overall organizational mission and values. Shared mission and values lead to better teamwork and aligned outcomes. Though financial drivers exist within in-house AEC groups, they are not the primary reason that in-house AEC groups exist. This is not to say that private-sector AEC firms cannot or do not deliver excellent AEC groups. Rather, financial motivations are less compelling performance drivers for in-house groups than in the private sector. Teams aligned toward the same outcomes tend to achieve their goals more efficiently than those teams that do not share or exist under the same organizational (as opposed to project-based) objectives.

Ease. Internal customer ease of initially engaging and working with in-house AEC groups compared to working with outside architectural and engineering (AE) firms can be significant. Easy engagement translates into efficient delivery of AEC services, which itself translates into lower costs and lower administrative effort through less paperwork and less stress. “Ease” arises through the development of strong, mutually supporting professional relationships that the internal AECs build over years by collaborating with their in-house customers. These relationships are at the heart of successfully delivering multidisciplinary services.

Familiarity. The in-house AEC groups’ familiarity with the organization’s facilities history reduces initial project investigation time and the number of surprises that emerge as the project evolves. This benefit arises through working on multiple, often unrelated projects in a given facility over the course of many years. Shared institutional knowledge promotes the efficient execution of the work.

Local Supply. Consideration must be given to the local supply of competent external AECs. Institutions surrounded by well developed, large, diverse populations (i.e., cities of a few hundred thousand people or more) tend to have a greater supply of competent AECs within reasonable geographic reach than do institutions in rural or more geographically isolated areas. Institutions within smaller or more geographically isolated areas tend to benefit from the capacity and capabilities of in-house AEC groups than those in areas that enjoy a larger capacity and breadth of services in their geographic area. In-house AEC firms should be structured to compliment rather than directly compete with the services provided by external firms.

The ebb and flow of local, regional, and national economic cycles will also affect the capacity of external firms to deliver the needed AEC services. In-house AEC groups provide a buffer against reductions in the available capacity of external AEC firms that emerge during times of strong design and construction demand.

Establishing the Market Niche

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A thoughtful approach to establishing the market niche that in-house AEC groups will serve is always warranted. The nature of this niche may be informed by many factors, including the following:

  • Discipline-specific deficiencies in the capacity or expertise of local external firms to provide the desired services.
  • The benefits of having in-house rapid response/walk-in in-house service without the administrative efforts involved in soliciting, engaging, contracting, bidding, monitoring, and paying external firms.
  • The benefits of having the ability to execute frequent small, relatively simple projects in short periods of time that might be less practical to accomplish quickly using external AECs.
  • The benefits of having in-house teams oriented toward specific usages such as labs or classrooms to promote facilities that are consistently developed and outfitted beyond simple compliance with established design and construction standards.
  • The benefits of retaining close control over the technical aspects of certain types of projects that may not lend themselves to being covered in standard details or specifications.
  • Efficiency gains that can be realized when the same in-house designer(s) or constructors performing frequent repetitive or similar work within a large number of facilities.
  • Expedited project delivery achieved via pre-construction collaboration between in-house designers and in-house constructors.
  • The benefits in having teams oriented toward a programmatic approach that moves from facility to facility to address longstanding systemic needs, such as mechanical maintenance, that are inherent in decades-old facilities.
  • Rightsizing teams based on durations and scale of work. Having in-house AEC teams oriented toward small-scale projects enables them to be used on multiple projects through a given time period as opposed to being locked into on few large, long-duration projects.
  • Optimal sizing of the in-house AEC groups. Large, complex projects require dedicated and sophisticated project controls, management, and oversight. With the trend toward compressed project schedules, the personnel performing these duties on relatively large projects will have limited capacity to productively contribute to other assignments occurring at the same time. Large, regional, or national AEC firms tend to have personnel experienced in delivering large, complex projects. They are typically better equipped than in-house AEC groups to dedicate design and construction staff to large projects.

Architectural and Engineering Disciplines Represented

Consideration of the various aspects of the overall niche will lead to determining the disciplines that will comprise the in-house AE team. The following disciplines are worth considering in setting up an in-house group.

Mechanical, Electrical, and Plumbing (MEP)

Institutions such as large public universities have campuses comprised of many facilities totaling hundreds of thousands or millions of square feet. Nearly all of these facilities have heating, cooling, ventilation, and water needs. Funding for the maintenance of these systems sometimes becomes secondary to funding for more glamorous or visible projects such as new buildings. As a result, these systems age, wear, and become outdated beyond their service life and large backlogs of deferred maintenance for MEP systems develop. Dedicated in-house MEP staff can address these systems and participate in multiyear programs to upgrade them. Additionally, office renovations often have minor mechanical and electrical system needs that the MEP staff can address. MEP needs tend to be the most numerous of all disciplines.

Architectural

Office renovations, remodels, and re-purposing projects, as well as general small improvements, are often multidisciplinary in nature and are customarily led by architectural staff when the architectural components comprise the largest discipline of the project. This staff coordinates the various subdisciplines toward achieving the design objectives. Architectural staff may also include interior designers to coordinate and select finishes and furniture as well as staff to create 3-D renderings for use in effectively communicating design intent to stakeholders.

Structural

While in-house, heavy structural design capacity (such as for building structural system design) is unlikely to be feasible, some structural design capacity is beneficial. In-house structural engineers can respond to emergency structural issues such as cracks in walls, subsiding foundations, and leaning structures. Additionally, if desired, day-to-day structural program work can be performed, including façade inspections, miscellaneous structural element inspections, masonry repair recommendations, and investigations of minor structural framing and bearing capacity issues.

Utility

Depending on the ownership of an institution’s utility systems, an in-house utility designer for distribution systems, including electric power, sanitary sewer, potable water, telecommunications, and chilled water may be desired. The maintenance and expansion of these systems is critical to maintain the continuity of operations, and dedicated staff for them is beneficial.

Civil

Less focus tends to be placed on systems outside of buildings than on systems on the inside. Dedicated in-house civil engineering staff can provide engineering services for a variety of exterior and grounds needs, including parking lots, roads, sidewalks, bike paths, bus stops, site access, stormwater management, site grading, landscape, hardscape design, utilities, traffic control, and more. All institutions have some of these needs, and an in-house civil engineering staff can support design improvements for them.

Specialty (Roof and Elevators)

Depending on the magnitude of the inventory, designers for specialty systems such as elevators and roofs may be beneficial. A long-term programmatic approach to addressing roofing assets with 30-year lifespans will promote the efficient use of funding. In-house design staff can help with the designs and the management of this approach.

Building Code and Permitting

Depending on the building code and permitting environment of the jurisdiction in which an institution lies, in-house building code and permitting staff may be beneficial to assist in providing interpretation of code issues and coordinating with agencies having design review, approval, and inspection jurisdiction in the resolving code and permitting issues. The administration and maintenance of paperwork and records relative to permits can be extensive, and dedicated staff to handle it may be beneficial.

BIM

Building Information Modeling (BIM) is increasing its presence within facilities design, construction, operations, and management. In-house BIM staff can serve to monitor an AEC team’s delivery of BIMs during design and construction, as well as the transfer of data at project closeout to operations and maintenance activities.

Interns

Interns can serve many purposes within an in-house design services group. They can do the following:

  • Perform lower-level work such as researching issues and drafting that would otherwise be done by higher-level staff whose time is better spent elsewhere;
  • Introduce ideas learned in the classroom to the unit;
  • Serve as mentees to staff to develop the staff’s own leadership skills;
  • Advance initiatives that may be prohibitively expensive to advance with regular full-time staff;
  • Advance productivity and innovation through their familiarity with the latest technology applications; and
  • Provide learning experiences from industry professionals to augment classroom learning within the institution.

Construction

When deciding whether to develop an in-house construction team, the same consideration must be given to construction as was the in-house design teams. As with AE units, an in house construction unit should be complementary to the local external contractor community, and not viewed as competition to it. A clear mission for the team should be created for initial projects, as well as the long-term plan for the unit. What additional value can a construction unit bring to the institution? Knowledge of the physical plant and a high level of quality installation are examples of some possible added value. What benefits can the team provide which are more difficult for external contractors to provide? Examples are quick-response teams for new faculty offices and research, annual classroom renewals, and staff office and swing space construction. While profit should not be the driving force for internal construction organizations, the unit must be competitive with external firms and provide added value and benefits.

Construction services will require technicians with different skill sets than the skills of maintenance personnel. When developing internal construction capacity, consideration must be given to the supply of local, skilled technicians in the workforce and competition for this workforce with external contractors. Consideration must also be given to union or non-union matters and the types of construction to be undertaken. Crew makeup (number of carpenters, electricians, plumbers, etc.) should reflect a realistic analysis of the annual work to be completed. An in-house construction team should not be sized to accommodate all construction needs of the institution but rather be aligned to strategically fill a niche to which external constructors cannot effectively react.

Additionally, it is best to develop internal construction capacities based on smaller, less technical projects where some of the more technical trades are subcontracted or borrowed from a maintenance team as needed. Permanent team members should only be brought onboard when past performance shows a high level of team success and future workload indicates the need for a larger contingent of technicians. As the team develops and gains experience, technicians can be added to take on larger, more complex projects.

Higher education institutions with architectural, engineering, or construction programs have a ready supply of interns to draw from. However, interns must be assigned to people who will willingly and enthusiastically dedicate time to manage and develop the interns. Interns will advertise their experience, which will reflect positively or negatively on your organization accordingly. The nature of the perceptions they communicate will correlate with the effort and attitude of the person managing them.

Financial Considerations

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The discussion so far has been largely absent of financial considerations beyond general points regarding contributing to the mission and increasing efficiency and value. Every organization in every arena, whether private or public, has financial considerations. At a basic level, every organization must evaluate the viability of its existence via a cost versus benefit analysis, even if this analysis is informally done. Services such as design and construction that can, on the surface, be equally provided by external firms attract attention as easy candidates for reduction or elimination during times of budgetary stress. Financial self-sufficiency will buffer against this. Complete self-sufficiency may not happen immediately, but a plan should be developed to get to the point that the income generated is equal to or more than the unit’s operational and personnel costs. It is assumed that neutral or slightly net positivity is the extent of the financial goals for the unit. Though internal AEC units are in competition with external AECs, they are not seen as business competitors in terms of increasing profit growth and other similar considerations. Internal units that strive for increased margins and “profits” similar to those in private-sector external units may unintentionally elicit resentment among the local external AEC community by being seen as having an unfair advantage over the external AECs. If internal AECs are set up to compliment rather than compete with external AECs, they will be seen more as partners as opposed to competitors.

The operational needs of a design unit are many. Computers, software, licensing, office supplies, plotters, document storage, information technology support, technology upgrades, maintenance contracts for office equipment, training expenses, and phones are just some of the needs.

One of the key components is the space itself in which the staff works. Frequently, there are limited choices for a new unit’s space (the unit often simply gets what it is given). However, when the opportunity does arrive to customize a space, thoughtful consideration should be given to how the staff will operate in the space. Technological innovations and the evolution of work practices inform the best use of space. Depending on the size of the unit, there may be many needs for a large unit (more than about 20 people) and fewer needs for a small unit (less than about 8 people). An optimized space will promote productivity, collaboration, quality, and morale. The following are a few components to consider:

  • Small (2 to 5 persons) and moderately sized (about 12 persons) closed conference rooms allow for privacy and eliminate noise distractions for those both inside and outside of the rooms.
  • A combination of private work stations for “heads down” concentrating work, as well as open areas that facilitate informal collaboration across disciplines, is ideal. No person only does collaborative work or only does heads-down work, so a balance of space types and choices is ideal.
  • A receptionist and receptionist area set up to screen visitors in the work space is ideal. Without it, unexpected external visitors such as vendors can (and will) enter the space and disrupt staff. Visitor reception and screening also contributes to a secure work space.
  • Private one-person offices should be provided only where needed, meaning where privacy and sensitive one-on-one discussions occur frequently enough to warrant dedicated space.

The ability to accommodate all of these features in any space is unlikely given the typical competition for room, but they are worth considering when choices are available.

Similar and additional needs will exist for the in-house construction group. Every person in the construction group does not need a computer, because one computer can generally be shared among several people, since use is only occasional for craftspeople. Beyond computers, additional space is needed within a construction unit for the following:

  • Meeting, training, and break activities
  • Materials receiving, processing, storage, and distribution
  • Tools and equipment storage and distribution
  • Shops for fabrication
  • Construction and delivery vehicle storage

Internal Budgeting

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For internal budgeting, a thorough consideration of the operational costs goes hand in hand with a thoughtful approach to income generation. There are several ways to approach income. Generally, time (worked hours) is charged to project budgets. For construction groups, material and equipment costs are also charged against projects. Time is billed per hour at established hourly rates. Rates are developed to cover all overhead and salary costs balanced against an estimation of income. This is typically done annually, with new rates implemented at the start of the fiscal year. It is crucial for the established hourly billing rates to be compared against current market rates for similarly sized firms in similar geographic areas providing similar services. Rates too far outside the range of acceptable rates will discourage internal customers from using internal AEC groups, while rates too far below market rates unnecessarily result in reduction in realized income for a given amount of work and may be seen by external AECs as an unfair advantage. Having said that, it may be necessary to structure rates slightly below market rates at the initialization of in-house groups to encourage internal customers to use the in-house services (presuming they are not mandated to do so). In this case, the in-house units will likely need supplemental funding to achieve, at a minimum, a net neutral financial position at year’s end.

Fees for projects can be developed in several ways. Common methods for design and construction and their advantages and disadvantages are summarized in the following tables.

Additional Considerations and Some Challenges

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Discussions of AEC service providers, whether in-house or external, tend to concentrate on technical competency. However, technical competency has become assumed and is not always the determiner of project success, especially on the types of projects in-house AEC teams execute. This is not to diminish the importance of technical competency but rather to say that technical competency alone in the absence of soft-skills proficiency will not lead to positive outcomes. In other words, technical competency is necessary but not sufficient for project success. Additional required skills that lead to successful project outcomes include the following:

Stakeholder Management

One skill revolves around recognizing that projects are executed for the benefits of many groups of people and that each of these groups have a stake in the success of the project. Terms such as “client,” “customer,” and “end user” are often used interchangeably. Without common definitions communication suffers. Though these terms have nuanced and different meanings, varying with the persons using the words, the term “stakeholder” is used here to encompass all these meanings. For the purposes of this chapter, a stakeholder is any person or group who has interest in or input into the project. Stakeholders vary in terms of the level of impact and influence they wield on a project. The funding entity is one of the most important stakeholders. Since they are paying the bill, it is reasonable to expect that they should have significant influence in determining how their money is spent. Another stakeholder is the end users, whose input is crucial in setting objectives and assessing satisfaction with the finished project. Operations personnel, maintenance personnel, the public, departmental staff, the AEC team, safety personnel, first responders, permitting agencies, subcontractors, subconsultants, and administrative staff are among the other potential stakeholders. Skill in identifying the stakeholders and the limits and influence of their unit is important in setting objectives and expectations.

Understanding the project from the stakeholders’ perspective is essential. The AEC team needs to understand the objectives of the stakeholders and develop a plan to meet them. Often, there are many stakeholders with competing objectives. Objectives usually boil down to matters of schedule, cost, and scope. Competing or impractical objectives must be resolved early to prepare a scope, schedule, and fee proposal that works. For example, issues such as a project schedule that is shorter than the lead times for equipment orders or a project that desires interior finishes of greater quality than the budget allows must be resolved. The ability to recognize and facilitate communication toward a coherent mission is crucial. This requires patience, clarity, candor, and tact by all.

Understanding the stakeholder’s objectives is important, but helping the stakeholders understand the processes, steps, and obstacles to achieve the objectives is also important in establishing realistic expectations that can be met. Some stakeholders have some knowledge or awareness of design and construction processes, and the tendency may exist to extrapolate what they believe onto the project at hand. The design lead or project manager must reign in expectations to within the confines of the reality of what it takes to get projects done at an institution. Public or quasi-public institutions such as universities have significant policy boundaries, such as procurement processes, that do not exist in the private sector. These constraints may not always be apparent to people who do not experience them every day. Communicating them during project development promotes the creation of expectations that can be met by all parties.

Communication

How stakeholders are communicated with is important. There is no one-size-fits-all method. Different communication methods exist because they are in one way or another more effective than other methods for the purpose at hand. Problems arise when one method is overused or misused. For example, email is effective for listing items, documenting decisions, and capturing and conveying facts. Tone and attitude are unfortunately often read into emails where it was not intended by the writer, resulting in the message received being interpreted differently than intended by the sender. For this reason, email is best used when conveying factual information that is absent of emotional content and leaves little room for interpretation. Emails should not be used for arguing or delivering bad news. Face-to-face meetings should be arranged in advance (as opposed to “popping in”), but these are not always practical due to location and time. Face-to-face meetings should always be used to communicate bad news and resolve difficult, complex, or contentious issues. Interruptive methods of communication that force the receiver to stop what they are doing immediately and respond are effective in dealing with urgent issues of simple complexity. Texting is effective for extremely brief and simple messaging, such as “I will be 10 minutes late for the meeting.” Using the most appropriate method for the situation promotes effective communication, and effective communication promotes positive outcomes.

Advocacy

A design lead must also be an advocate for the project and his or her customer. This means having awareness of and looking out for aspects beyond the design that affect the project’s execution. Aspects could include an understanding of the construction process, the procurement process, bidding, the funding environment, and the effect of design on overall schedule. These needs overlap into project management needs, but the greater the awareness of the design team of these external issues the better the designer will be able to perform their work in a manner that results in best outcomes.

Self-Management

Another skill that design leaders must possess is the ability to manage multiple simultaneous projects that experience unexpected starts, stops, and turns—all with competing deadlines. Maintaining a full workload while accommodating these unexpected starts, stops, and turns while not overcommitting can be challenging. In-house AEC groups tend to have workloads comprised of multiple simultaneous smaller projects as opposed to a small number of large, long-duration projects. Small projects tend to have shorter deadlines and therefore less ability to absorb changes while still meeting the deadline. The ability to adapt to frequent, unexpected changes in project execution is essential.

Leadership

All the above skills can exist within staff, but the AEC group can still fail in its mission without an effective leader at the helm. Millions of words have been written and spoken about leadership. It is not the place of this chapter to discuss leadership in depth. However, a few characteristics stand out that are must-haves for AEC group leadership. First, the leader must model the behaviors they wish to see in the group they lead. This must be authentic and not contrived. Excellent communications skills are a given. Trust and care for each person in the group coupled with a professional assertiveness that is grounded by humility is essential. In the end, the leader must strive to create an atmosphere where the staff is inspired to better themselves and to follow him or her–not because they are required to but because they want to.

Adapting to the Process

Large institutions, public or private, tend to have entrenched and long-standing bureaucracies rooted in decades-old policies that do not ease efficient execution of projects. Multiple levels of approvals, linear (as opposed to parallel) administrative processes (“A” must be completed before “B” can start, etc.), and paperwork hinder speed at the benefit of risk reduction and the promotion of transparent, open competition. These bureaucracies can be difficult to change, so they must be taken into account when planning project schedules.

Talent Challenges

Public institutions often attract employment talent by the appeal of their noble public mission, work-life balance, stability, and generous benefits. However, these benefits alone may not be sufficient to attract top talent, as salaries at public institutions are typically less than salaries at private-sector firms for similar positions. Awareness of this tension is necessary to effectively compete with the private sector for talent and should be countered by promotion of the many tangible and intangible benefits of working at institutions.

Organizational Structure

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How in-house AEC groups are structured is an important consideration. One structure is to have administratively separate departments housing the AE and Construction groups. AEs and constructors historically have different work cultures, and keeping the groups separate will eliminate the conflict inherent in having different work cultures mix. This does not mean they cannot work together, but that they will benefit from management styles that understand and reflect their individual cultures. At the same time, the AECs should be aligned, as both contribute to their parent unit’s mission. Each group will presumably be working with and collaborating with external architects, engineers, and contractors, and so should have common approaches and attitudes in dealing with these external stakeholders. Separate administrative units, reporting through the same parent unit, will promote the alignment of goals, abilities, and a top-down management approach. When design units and construction units are separate (as opposed to combined into one unit) the units do not depend on one another for workloads, though they may work together on some projects. This independence allows for greater flexibility and alignment between each group’s individual strengths and project pursuits.

Combining in-house AEC groups into one unit has advantages as well. A unified AEC team reduces the overall administrative efforts within the organization, although separate, less formally arranged subunits can still be set up. The constructor, typically being the entity with the greater dollar volume of work, may take the lead in a combined arrangement with the AE, following their lead on the nature of projects to be executed. The combined unit can function as a design-build team leveraging the relationships and familiarity with institutional administrative processes to significant benefit. In this arrangement, there must exist a mutual respect for each group’s customary culture, services, and expertise. Efficiency gains, cost reduction, and response-time reductions can result when administrative processes associated with procuring and managing external design or construction firms do not exist. Construction documents do not need to be prepared for bid or have the level of details needed for external construction. Reduced response times and reduced risks can be substantial when in-house AECs design and build projects together due to aligned missions, values, and motives. Benefits of having constructor input during design on issues such as constructability, materials availability, and level of detail development needed in the drawings leads to smoother construction. Frequent candid, trust-based feedback between the constructor and the AE can be rapidly fed back into current and subsequent projects to further improve efficiencies and outcomes.

Performance Metrics

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Measuring and monitoring performance identifies problems, informs the planning of future activities, and identifies areas of excellence to be celebrated. Performance metrics are most useful when they align with operational goals. Metrics should account for the groups’ growth stage—e.g., just starting, developing, mature—and focus on a handful of key metrics as opposed to dozens of unrelated data points. Performance metrics can be displayed in a dashboard configuration where they can be easily digested in a few minutes. Dashboards are especially useful to senior administrators reviewing a unit’s operational performance.

Leading and Lagging

Metrics fall into two broad categories–lagging and leading indicators. Lagging indicators record past performance, identify performance problems, and can be used to establish corrective actions. Lagging indicators include employee turnover, utilization rate, accidents, and hours spent on errors and omission rework. Leading indicators inform the future state and are used to plan resources and set the stage for future operations. Leading indicators may include number of inquiries for new projects, percent complete versus percent spent, and days of delay (in schedule compliance). Both leading and lagging metrics are useful.

At the heart of successful delivery of AEC services lies compliance with scope (quality), budget, schedule, and safety. Quality in design can be measured by the number of requests for information (RFIs) received during construction (though this can be heavily influenced by the sophistication and quality of the contractor) and the dollar amount of error and omission work required to meet project requirements. Similarly, for the constructor the amount of corrective re-work can be measured in dollars. Schedule is simple to measure–how many days ahead or behind is the project from its design or construction schedule. However, a constructor’s schedule compliance can also be impacted by things outside of his or her control such as AE responsiveness and cooperation levels, untimely decision making by the owner, weather, unanticipated long material lead times, and unforeseen conditions. This also assumes, however, that a hard schedule has been established. “As soon as possible” is not a date or time that can be measured against and is not a schedule. Budget performance is also simple to measure by dollars but can also be influenced by the same factors as are those for schedule compliance. Safety performance is primarily the domain of the constructor and common industry measures such as Experience Modification Ratings (EMRs) can be used.

Customers

Customer satisfaction is a crucial part of determining project success. It is possible to meet all scope (quality), budget, schedule, and safety goals and still have a dissatisfied customer. This could result from poor communication by the AEC during project development in the form of a lack of attentiveness and responsiveness, or unprofessional conduct by design or construction staff. Customer surveys can be used during project development to gauge team health during the project and after occupancy to gauge satisfaction with the overall project development process as well as the finished built project.

Be Careful

A word of caution about metrics, though. It has been said that if something cannot be measured it cannot be managed. Overreliance on this maxim can lead to the neglect or devaluing of things that are not easily or objectively measured. While many things that can be measured easily—such as budget and schedule compliance—are important, intangibles that are equally important to project success—such as leadership, attitude, helpfulness, and being a team player—are less easily measured objectively. Surveys yield clues to the strengths of these attributes, but such surveys are also subjective, depending on the impressions of the persons being surveyed. These attributes cannot be measured in discrete units such as days or dollars but are equally important. Intangibles cannot be ignored or neglected, as they are often the most influential factors in a project’s success while also being the most difficult to correct.

Conclusion

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Deciding to initiate in-house AEC groups is a significant milestone in the evolution of an institution’s facilities management group. However, it should not be undertaken lightly, as there are many factors to evaluate. In the end, the significant advantages realized by supplementing external AECs with in-house resources are worth considering in the overall effort to provide the institution with safe, sustainable, modern, efficient, well-designed, and well-built facilities.

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