Presented by Gordian.
When it comes to public procurement, construction projects present a unique challenge. Unlike routine commodities, careful consideration must be given to factors such as long-term durability, subcontractor performance, unexpected delays, and more.
If you are preparing for an upcoming construction project, you may be considering using Job Order Contracting (JOC). While JOC isn’t one-size-fits-all, for the right project this construction procurement method provides increased scalability, faster timelines, and additional accountability.
Procurated Founder and CEO David Yarkin had the opportunity to have a conversation with Dan Cook, Vice President for State, Local, and Education (SLED) at Gordian. Gordian, provider of data, software, and services for all phases of the building lifecycle, was founded by the creator of JOC and has been implementing and supporting thousands of successful JOC programs across the nation for the past 30 years.
Over the course of the 30-minute conversation, Dan shares countless insights into how he’s seen JOC be most effective in his 22 years with the company:
What exactly is Job Order Contracting?
At its core, JOC is an indefinite delivery, indefinite quantity (IDIQ) construction contract. Rather than submitting total bids and specs for individual projects, a JOC contract provides unit-level pricing for construction tasks such as painting a wall, putting up drywall, paving a sidewalk, installing a bench, etc.
For this reason, JOC is best suited for straightforward construction projects, such as renovations, replacements-in-kind, or retrofits. Think, a public housing complex making renovations to many units; or a town replacing all public streetlights or sidewalks.
A JOC bid goes through the same solicitation process as a traditional bid. But, Dan goes on to explain, Job Order Contracting provides a long list of benefits to the agency in the long-term.
Increase your department’s efficiency using JOC
As the uncertainty caused by COVID-19 carries into 2021, procurement departments are asking how they can do more with less: budget, resources, time. Job Order Contracting can assist on all three fronts.
Let’s revisit the above example of renovating units in a public housing complex. Using a traditional procurement method, each renovation project would need to be identified, designed and put out to bid, typically taking months to complete and requiring a significant amount of administrative resources. If there were 50 projects identified, the solicitation process happens 50 times. Alternatively, a Job Order Contract is bid one time for an indefinite number of projects, eliminating the time-consuming competitive solicitation process for each individual project.
In addition to the time savings provided by JOC, other benefits include:
Costs are controlled. Unit prices are established upfront for all construction tasks for the life of the contract.
The project is “shovel-ready.” Contractors are already competitively awarded, so as soon as a project is identified, they can begin work.
Increased bandwidth. With a single contract,strapped team members can focus their time on other projects.
Supplier accountability and partnership skyrockets with Job Order Contracting
At its core, JOC is performance-based. While the contractors are awarded for the duration of the contract, they are not guaranteed work. Because of this, contractors are incentivized to collaborate with owners, perform their best work and treat each project as an opportunity to earn future work.
This is good news for the agency, assures Dan. If one of the key avenues to earning future work is to help agencies meet their goals – be that a timeline, supplier diversity, or sustainability – the contractor is more invested in meeting those goals, too. The agency is thrilled with the result, and the contractor is awarded more work. It’s a win-win.
The time-saving nature of JOC also sets the groundwork for stronger partnerships. Controlled costs allow the focus to be on the actual construction planning, not price haggling. And with less time being spent on solicitations, more agency (and contractor) resources can be spent on enhancing the project in other ways, like selecting high quality subcontractors and anticipating and planning for future challenges.
How Gordian can help you do JOC, better
Job Order Contracting clearly provides a wealth of benefits to any routine construction project. But, the method presents its own set of questions: how do I know I am locking in the best per-unit rate? How do I manage my job order contracts long-term? How do I know I am doing this right?
Working with Gordian provides three key areas of support to help you get the most out of your JOC program:
Data: The foundation of Gordian’s ability to provide local material, labor and equipment pricing is built on robust datasets that ensures a fair price every time.
Software: Gordian Cloud, a collaborative online platform, allows agencies to manage their projects in real time. The easy-to-use software is designed to meet JOC best practices and provide every job order with transparency, audit-ability and control.
Expertise: By overseeing more than $2.4B worth of construction every year, Gordian’s experience implementing and administering JOC programs is truly unmatched.
Gordian’s data, software, and expertise are most impactful when applied across the full lifecycle of JOC. While IDIQ contracts have become common practice over the past 30 years, many SLED organizations struggle to utilize these contracts to their fullest extent. With Gordian’s expertise as a resource, agencies can strategically prioritize projects, manage budgets, and plan for emergency work using the IDIQ contracts they already have in place.