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Job Order Contracting: Understanding the Method


Quality JOC contractors will help advise what method of procurement may be ... Mohave's general construction JOC contractors completed more than 1,000 projects ... – PowerPoint PPT presentation

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Title: Job Order Contracting: Understanding the Method

Job Order ContractingUnderstanding the Method
RS Means
1 Question? How do I know I am getting the best
value with JOC?
JOC RS Means
December 2009
  • For nearly a decade, Mohave Educational Services
    Cooperative and its Job Order Contracts have been
    meeting the needs of Arizona schools, cities,
    counties, and other entities
  • In fact, meeting the needs to the tune of over
    150 million in completed projects (with no
    litigation and virtually no vendor change orders)
  • For the past several years, members and others
    have heard many comments about the
    cost-effectiveness of RS Means JOC
  • After several years of educating Mohave members
    on our JOC contracts, the number one question
  • How do I know I am getting the
  • best value with JOC?

How do I know?
  • Across the country, and in fact the world, Job
    Order Contracting or JOC continues to gain favor
  • The skeptics who argue that I bid everything
    are realizing they have missed some valuable time
    savings and partnerships
  • To truly understand JOC, you must first
    understand the differences between DBB and JOC
  • Understand the differences,
  • you will understand
  • the value of JOC!

JOC vs DBB The Major Differences
  • JOC is collaborative DBB is confrontational
  • JOC is a partnership DBB is traditional
  • JOC using RS Means is knowing exactly what you
    will pay DBB is more guesswork
  • JOC is about knowing exactly when your project
    will be completed DBB is about knowing your
    project will be completed, but not sure when and
    with how many change orders
  • JOC is certainty DBB is uncertainty
  • JOC is win-win DBB is someone wins
  • and someone loses

Exactly What is JOC?
  • Job Order Contracting or JOC is an Alternative
    Delivery Procurement Method authorized by the
    Arizona legislature in the early 2000s
  • JOC is primarily intended for and used for
    renovations, repairs, and remodels (although some
    minor new construction may be completed)
  • JOC and other ADPMs set win-win relationships
    between qualifications selected contractors and
    their customers
  • When time, budget, and value engineering are
    important, JOC should be considered!
  • Not all JOC contracts are
  • the same!

(No Transcript)
  • JOC Types of Projects
  • Any renovation, repair, replace or minor
    construction project that is operating under
    pressure due to time, budget constraints and/or
    lack of dependable resources
  • Minor construction projects (generally under 1
  • HVAC and Electrical
  • Routine repairs
  • Renovations of all types
  • Upgrades to ADA standards
  • Emergency repairs
  • Site work and utilities
  • Parks and playgrounds
  • Upgrade landscaping
  • Classroom additions
  • Classroom labs
  • Complete new buildings
  • Replace flooring
  • GREEN enhancements
  • And, more

What is JOC is not!
  • It is not for every minor renovation, repair, and
  • Quality JOC contractors will help advise what
    method of procurement may be better suited for
    your project
  • In general, new construction and projects over
    3M are better done via other procurement or ADM
  • When time, budget, and value are scored in the
    decision process, JOC is often the best tool to
    get work done

Understanding Mohaves JOC Award
  • In the past several years, more Arizona entities
    have negotiated their own JOC awards
  • In nearly every case, these new awards are
    different from each other in several key areas
    which should be reviewed closely
  • Coefficients are applied to varying data columns
    in RS Means
  • Some awards allow for billing of certain
    categories that are not chargeable with the
    Mohave contract
  • As with all Mohave contracts, members and anyone
    else may download the complete Mohave JOC
    solicitations from our website at

Now what?
  • To truly understand the differences between JOC
    and DBB, we are going to walk you through a Case
    Study and then we will look at RS Means in more
  • After that, we will look at some more specific
    Cases and then conclude with some final questions
    to ask yourself before deciding if JOC is right
    for your next project

Case Study
  • The following case is meant to show the value of
    the method of JOC
  • In some cases, JOC is less expensive than
    design-build in other cases, it is not
  • The important question to be answered by the
    decision maker is the following
  • In-house, Bid, or JOC?
  • What goes into that decision?

  • Case Study 1 - Actual Mohave Delivery Order
  • Owner had formal design completed for rebuild on
    an existing athletic field.
  • Project was bid and prices came in 10 over the
  • Owner asked Mohave JOC contractor to price the
  • Contractor priced the job per plans and
  • Contractors price included required work that
    was missing from the plans and specifications.
  • Owner awarded the project to the JOC contractor
    and included contingency.
  • Project was completed on time with no change
    orders and contractor returned the contingency.
  • Time saved 10 weeks
  • Money saved 74,350

Case Study 1 Data Analysis
  • Design was done under separate contract as part
    of the DBB project. Design could have been done
    under the Mohave JOC professional services or may
    have been eliminated under Mohave JOC.
  • Low bid.
  • Price proposal developed from the UPB and
  • During the JOC scoping session, additional
    work was
  • identified that was missing from the
  • This would be a change order under DBB.

More on the Method RS Means
  • JOC is a multi-step process (as many as 10-steps)
  • RS Means is the cost estimating component of one
    of the steps
  • Sample cost estimate
  • How RS Means differs from Bid piece of paper

Step 1
  • The JOC Process
  • The Reality--A 10-Step Process
  • Step 1 Initial Request
  • Step 2 Scoping Session
  • Step 3 Scoping Confirmation
  • Step 4 Estimate Preparation
  • Step 5 Plan the Job
  • Step 6 The Actual Construction
  • Step 7 Updates
  • Step 8 Final Inspection
  • Step 9 Close Out
  • Step 10 Warranty Issues

Step 10
Note Steps 1-5 are what makes JOC so much
different than DBB
JOC Steps 1 through 3
  • Step 1 Initial Request
  • Step 2 Scoping Session
  • Step 3 Scoping Confirmation

  • Step 4 Estimate Preparation
  • Determine quantities of work.
  • Build the estimate from the UPB.
  • Summarize the estimate and apply coefficient.
  • Apply city cost index.
  • Apply applicable bond, permit taxes.

Step 4 (Continued) Estimate Preparation
Unit Cost w/OH P
Apply City Cost Index
RS Means Index
Apply Coefficient
Total Cost
Step 5 Plan the Job (Prepare a schedule)
Plan the Work... Work the Plan
No Surprises!
  • Step 6 The Actual Construction
  • Step 7 Updates
  • Step 8 Final Inspection
  • Step 9 Close Out
  • Step 10 Warranty Issues

The easy stuff!
Who will fix?
Mohave Cast Study 2 Renovation JOC
  • RS Means

Mohave Cast Study 3 HVAC JOC
  • RS Means

Mohave Cast Study 4 Fencing JOC
  • RS Means not used for Mohave JOC

  • Case Study 5 - Mohave JOC 35-Month Summary
  • (Nov 2005 Oct 2008)
  • Mohaves general construction JOC contractors
    completed more than 1,000 projects over the
    35-month period.
  • Actual DBB costs for the projects are unknown
    however, DBB costs can be approximated by using
    factors and estimates from practitioners or other
  • Comparison of DBB and JOC requires total cost
    (construction soft costs).
  • Comparison of DBB and JOC requires final cost,
    rather than initial bid price.
  • Cost comparison of DBB and JOC is insufficient
    because it fails to include a comparison of time.
  • Owners saved (avoided) significant total project
    time. However, it is difficult to assign a
    dollar value to time savings.
  • Study data substantiates the savings resulting
    from JOC. However, JOC is not the answer for all

(No Transcript)
Case Study 5 Explanatory Notes
So, did I get the best value?
  • DBB (look at your last comparable DBB)
  • How long was my solicitation process?
  • Was I satisfied with the vendors who responded?
  • Was there a Bid protest?
  • Did my project get done without any change
  • Was there any litigation?
  • Did awarded vendor provide any value engineering?
  • Was my project done on
  • time and on budget?

So, will I get better a value with JOC?
  • How long will my solicitation process be? 0 days
  • Am I satisfied with the vendors who are
    available? YES
  • Will there be a Bid protest? NO
  • Will my project get done without any change
    orders? YES
  • Will there be any litigation? NO
  • Will my selected vendor provide any value
    engineering? YES
  • Will my project done on
  • time and on budget? YES

Making a Successful JOC!
  • Ensure the project is funded or that funding is
    readily available
  • Owners representative must understand JOC
  • Not simply another price quote for the work
  • Not a free estimating service
  • Owner still has a lot involvement in the job
  • Allow adequate time for the process
  • Contractor invests a lot of front end effort
  • Owner can expect excellent execution of the work
  • JOC eliminates most change orders
  • Ensure that all owner contractor stakeholders
    have had sufficient input into the job
  • Ensure owner contractor consensus on scope,
    schedule and cost
  • Owner contractor must each holdup its end of
    the bargain
  • Successful JOC is a non-adversarial relationship

  • JOC is one of the fastest growing construction
    procurement methods in the world
  • Value is created from the startqualifications
    based selectioncontinued throughout
  • When all construction factors are considered,
    such as budget, time, quality, etc., JOC provides
    an excellent value
  • Ask the questions, ask the experts, consider JOC
    for your next project

  • Thank you for your attendance today
  • Please complete the presentation questionnaire
  • Questions may be directed to Mark Kinsey at
    Mohave or any of the Mohave awarded JOC vendors

  • Training Development Team
  • Bel-Aire Mechanical (Specialty)
  • Browns Fence (Fence Contractor)
  • Centennial (General Contractor)
  • Parsons (General Contractor)
  • Phoenix Fence (Fence Contractor)
  • Pueblo Mechanical (Specialty)
  • SDB, Inc (General Contractor)

Note Please feel free to contact any of the
presenters directly with any questions regarding
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