Owner as the team member.
As homes and buildings have become more complex both in design and construction, the need for expert project oversight has become essential. A project's success depends on the following team members: The Architect, Designer, Contractor, and most importantly - The Owner.
The owner carrying the entire financial risk of a project has the most important role on the team to achieve project success. The owner must ensure that the crucial components of their project responsibilities are provided to all team members in a timely manner. One unanswered question can hinder or even halt forward movement on a construction project, elongating the schedule and ultimately cause budget creep. The reality for the owner's position on the project is they are on-call all day, every day, to keep the project moving and protect the project budget.
Owner’s Project Responsibilities:
Listed below are just a few of the many responsibilities required by the owner during the process of construction.
- Assembling the project team
- Pre-qualifying vendors, requesting proposals, contract negotiations
- Developing project requirements
- Size, style, and type
- Setting time, cost, and quality expectations.
- Monitoring the budget and approving costs
- Funding and payments for all payables; contractors, vendors, licenses and fees, inspections, insurances
- Coordinating and monitoring team members
- Provide direction, ensure collaboration, resolve conflicts
- Compile all project documentation and data
The owner must incorporate a systematic approach for all team members to follow to have project success.
- Expectations and Responsibilities - Create clarity in a goal-driven approach to ensure that all team members understand the project expectations and one another’s responsibilities as part of the sum total.
- Documentation Accessibility and Administration - Creation of a system for managing all documentation to eliminate opportunities for outdated plans, schedules, and documents to send a project off course. The system should be easily accessible by the entire team.
- Communication - Maintain an open channel of communication for all team members to stay in alignment.
- Monitor - There are many items to monitor during a construction project. To mention a few: design details and quality, inspections, and team member accountability
A construction project is not a race but a marathon that will likely take over a year to complete. All of the functions listed above are incredibly time-consuming, especially if you think in terms of the compounding effect of the daily management duties. To maximize efficiency in this process, it is ideal for the owner to have construction expertise to create workflows, budgets, and schedules as well as manage risk. Yet, no matter how meticulous your efforts are, there will be a real-life situation that has more facets to consider than any manual could predict
Enter an Owner’s Representative.
An Owner Representative is a construction industry professional who utilizes their experience, knowledge, and resources to protect the financial, quality, and time interest of the principal owner of the project.
With the multidisciplinary construction knowledge, the Owner’s Representative (OR) becomes the voice of the owner on the project team and increases the project efficiency by overseeing all facets of a project from inception through close-out. Owners’ vested interest being the pinnacle of effort ensures that the intricate balance of budgets, schedule, and quality are met at their optimal points.
Why is the need for Owner's Representatives increasing?
Technology and design within the construction industry are rapidly evolving as architects and designers push the design boundaries, especially in modern homes and buildings. Energy-efficiency, innovative new materials, construction methods, and automation within homes and buildings have considerably changed how a construction project is managed and delivered. Economic risk increases as projects become more complex. Therefore, individuals who have traditionally served as the link to the owner have had to become more focused in their area of expertise, making it necessary to have a singular expert oversee the entire project and project team.
In many cases, the project owner may not have the knowledge or resources to monitor the construction process ensuring success. As a result, many owners have begun hiring Owner's Representatives to represent their interests. The OR speaks for and advocates on the owner's behalf, independent of the design and construction teams. This also allows every other team member to stay within their center of excellence.
Another benefit to hiring an OR is that each vendor is typically contracted directly with the project owner. This requires the owner to deal with conflict resolution and any potential finger-pointing cross-team. By hiring an OR, this person becomes the single point of contact for all team members and works with the team to solve conflicts. Allowing the owner to focus on their desires for the project's outcome and removes the day-to-day project stress.
- Due to the rapid innovation in design and construction, the need for meticulous project documentation has increased and become more complicated. The OR consolidates all the paperwork that a team produces, including all project documentation, schedules, financials, and status updates, as a single source of truth for all parties to reference. The owner is then kept up-to-date with an executive summary from a single source rather than being overwhelmed with multiple reports from each member of the team that may mean little on their own without other vendors supporting documentation.
What are the qualifications of an Owner's Representative?
An Owner's Representative must bring expert multidisciplinary knowledge to all facets of a construction project.
The Owner's Representative:
- Has the ability to work at a peer level with all project team member
- Is experienced at negotiating contracts and collaborates with the project attorney to ensure that all contracts meet the project needs
- Has the knowledge and contacts to assemble a custom home build project team
- Understands technical information presented by each member of the project team and has the ability to communicate that information across the team using industry terminology followed by creating executive summaries for the project owner.
- Ideally has extensive experience working through many of the standard issues that arise during construction to keep the project running smoothly.
- Analyzes the team members' requests and suggestions to make recommendations that will financially benefit the owner.
What Does an Owner's Representative Do?
The Owner's Rep works for and speaks on behalf of the owner, obtaining the owner's approval throughout the project to accomplish the following:
- Develop the project scope
- Establish the budget
- Assemble the project team
- Monitor the project's financials
- Provide standardized reporting for the owner and the project team to ensure that all parties are aligned throughout the project
What Are the Benefits of Hiring an Owner's Representative?
Having an Owner's Representative monitoring a project benefits not only the owner but the entire project team. A qualified OR at a minimum is self-financing and typically captures more than their fee by reducing overall project costs through value engineering, contract negotiations, monitoring change orders, and reducing rework and schedule delays. This, coupled with removing the burden of daily monitoring of the project, are the most considerable benefits to the project owner. An OR provides executive summaries to the project owner, which alleviates the need to read reports from each vendor that may be meaningless when not paired with associated vendors' information. Owners can feel comfortable in their decision-making due to the OR's comprehensive data management.
The project team also benefits considerably by being monitored by an owner's representative. Leveraging technology to automate documentation and data for easy reference and providing conflict resolution are two elements that alleviate stress on a project team. An owner's rep also improves cross-team collaboration, leading to a better outcome for all. Having a holistic view of the entire project allows the OR to identify potential issues before becoming problems for the team and the owner. Removing project-related stress enables the team to focus on their area of expertise, allowing a project to run smoothly, and be enjoyed by all.
Construction is complex. We simplify the process and take over the legwork for owners who are building high-end residential and commercial properties.
Next Up: Stage of a Construction Project