The Changing Environment of the Construction Industry and Suggested Action Plans

History of CM in Japan and CMAJPrepared for CMAK

April, 2008Presented by T. Miyazaki

Member of the Board of Directors, CMAJ

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The Changing Environment of the Construction Industry

• History of CM in Japan– 70s and 80s– 90s– 2000s

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HISTORY of CM in JAPAN - 70s and 80s

– Many studies for US CM system were conducted, but no realistic trends in domestic market.

– JPs engineering contractors in international markets got used to CM system, but limited number of projects or cases.

– In late 80s under "Bubble" economy, many Mega-Projects arose, and GCs are tried to utilize CM in their construction projects.

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HISTORY of CM in JAPAN - 90s

– After the "Bubble" economy gone, construction investments are shrank, and CM trends were no more needed. At same time, many corruptions or scandals were revealed related to construction industry. GOJ restructured public procurement system for construction projects.

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HISTORY of CM in JAPAN - 90s (Continued)

– On the other hand, US required GOJ to open its market for US companies through bilateral treaty, and promoted CM system to GOJ. Although those CM trends, public market did not utilize CM.

– During 90s, property market went down, and foreign investors increased their interests in Japan's property market, and those clients started to use CM provider as their consultant.

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HISTORY of CM in JAPAN - 2000s

– GOJ has recognized that the market needs more diversity, and is trying to promote CM and other innovative procurement methodologies through public and private construction markets.

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HISTORY of CM in JAPAN - 2000s (Continued)

– GOJ conducted several studies in early 2000, and established "The Guide Line for CM" in 2002, and published "Manual for local government for CM procurement" in 2003. CMAJ directly supported those studies and researches.

– GOJ continues to promote CM in public sectors, and set the budget to supports local government's effort to expand CM projects in 2007. This effort is still on going.

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Changing Environment

– Based on recent efforts of GOJ, and also private construction market including foreign investments, CM is widely recognized as a alternative to conservative Lump-Sum General Construction Contract.

Now Environment is Changing!!

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Suggested Action Plans

• CMAJ – Association supports CM trend– History, Goals and Missions, Code of

Ethics, Organization, Recent Efforts• Recent Projects

– Recent Trends– Public Projects– Private Projects

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HISTORY of CMAJ 2001- 2005

• April 2001, Established• June 2002, Code of Ethics• April 2003, Provisional CCMJ Certified• October 2004, CM Guide Book Published• March 2005, First CCMJ/ACCMJ Exam

conducted. CCMJ/ACCMJ Certified

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HISTORY of CMAJ 2006 - 2008

• November 2007, CPD (Continuing Professional Development) program started

• November 2007, CM Contract Terms and Condition/Scope of Works published

• January 2008, CM Liability Insurance started

• April 2008, CM School started

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GOALS and MISSIONS

• GOALS– To reconstruct the construction project

delivery system– To develop responsible professionals

with ethics

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GOALS and MISSIONS (Continued)• MISSIONS

– Enhance understanding of CM– Expanding CM practice in the Japanese

industry– Development of the CM to service the

public and engineers.– Investigation and research of CM– Education and training for

Construction Managers– Alliance with global and Japanese

communities

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CODE OF ETHICS

Established June, 2002

• Integrity/Dignity • Neutral judgment• Rational justification• Continuous

improvement• Discipline• Compliance

• Relationship with Owners

• Relationship with CMAJ members and non-members

• Project stake holders

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ORGANIZATION

• Fourteen committees and five district branches have been organized.

• All activities are carried out under the management of the board of Directors.

• Board Meeting is held monthly.

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RECENT ACHIEVEMENTS

• CM GUIDE BOOK 2004• EXAM/CERTIFICATION 2005• CPD 2007 • STANDARD CONTRACT 2007• CM INSURANCE 2008• CM SCHOOL 2008

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CM GUIDE BOOK• Published in 2004• Sold approx 3,000 copies to

date• First Practical Textbook for

CMr• More than 360 pages• Over 70 Authors of

Professional CMr• One Stop textbook of CM,

covering History, Delivery Methods, Doctrines, and Technical knowledge.

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EXAM/CERTIFICATION

• First Exam conducted 2005• First CCMJ/ACCMJ certified

2005• Three EXAM have been

conducted to date

• 411 CCMJ have been certified to date

• Next EXAM scheduled August 2008

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CPD (Continuing Professional Development)

• Tied with CCMJ Certification

• 5 years program to earn 150 points

• Proactive involvement is required to maintain CM qualification

• Activities are evaluated by CMAJ CPD sub-committee

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STANDARD CM CONTRACT TERMS AND CONDITIONS

• Established in 2007• First standard contract

form for CM services• Focused on Pure CM• Lawyers and over 40

professional CMr including members of board worked over 3 years

• Standard Terms and Scope of Services are mutually dependent

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CM INSURANCE

• Established in 2008• Successfully started

from April 2008• First of its kind to

cover Liability of CM• CMAJ and Tokyo

Marine Nichido Insurance jointly hold

• Dedicated for CMAJ members

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CM SCHOOL • Started April 2008• One year program• Three category of

lectures– Basic course

• One course for CM basic knowledge

– Practical courses• 8 courses for detailed

aspect of CM delivery method

– Special Lectures• 8 special lectures

tied with each practical course

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Recent Projects• RECENT TRENDS

– GOJ supports• Ministry of Land Infrastructure and Transport to

provide assistance for local governments regarding CM deployment = CM Advisor Support

• RECNET PROJECTS– Public Projects – Infrastructure / Building

• Central Government• Local Government

– Private Projects – Developments and Buildings• International Clients• Domestic Clients

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CM Advisor Support - MLIT

• SUPPORTS TO CM PROJECT– Projects specified, CM advisor assigned

•Kamikoani Village – Bovis Lend Lease•Minami Soma City – Mitsubishi Jisho Sekkei

CM Dept•Adachi Ward – Gen Architectural

Management•Daisen City – NTT Facilities CM Dept•Takahama City – Yamashita PM Consultants

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CM Advisor Support – MLIT (Continued)

• SUPPORTS TO CM PROMOTION– Local government to hold lectures to its

employees•Iwate Prefecture – TAK Realty•Nagano Prefecture – JR East Sekkei•Osaka Prefecture – Overseas Bechtel, Inc.•Saitama Prefecture – Kajima Corp.

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Public Projects• Infrastructures

– Central Government• Shinano River Banking Project CM

– Local Government• Chimi Yoka Route Tunnel Project CM

• Buildings– Central Government

• Okinawa Institute of Science and Technology CM

– Local Government• Minami Soma City Library Construction CM

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Shinano River Banking Project CM• CM; Maeda Construction • Client; MLIT• Purpose of the Project; To

construct super bank on both side of Shinano River

• Total 30km river bank construction to prevent flood

• Over 26 contractors working at same time

• Scope; To assist MLIT for coordination of over 40 contractors for over 30 km length

• Completion; Mar 2009 (Plan)

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Chimi Yoka Road Construction Project CM• CM; OYO Corporation • Client; City of Toyooka and

Yofu Town• Purpose of the Project; To

connect two districts by viaduct to boost local economy and cultural communication of the area

• Including 1,500m NATM Tunnel

• Scope; To assist two local government jointly construct large scale road, Client organization had no resources to complete the project

• Completion; Mar 2007

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Okinawa Institute of Science and Technology (OIST) Project CM• CM; Bovis Lend Lease Japan • Client; OIST organization of

Cabinet Office• Purpose of the Project; To

Construct state of the art Research Center for Science and Technology

• Total Site Area; 70ha + 7 ha• Scope; To assist OIST from

Master Planning to Procurement Coordination

• Completion; Mar 2009 (Plan)

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Minami Soma City New Library Construction Project CM• CM; NTT Facilities CM Dept. • CM Advisor assigned by

MLIT; Mitsubishi Jisho Sekkei CM Dept.

• Client; City of Minami Soma• Purpose of the Project; To

construct brand new public library

• Scope; CMr to manage architect and contractors and give client advices

• Total Floor area; 6,700 sqm• Completion; Mar 2010 (Plan)

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Private Projects• Projects by CM provider

– Mitsubishi Jisho Sekkei CM Dept.• Insurance Company HQ, New High School CM,

Office Building Complex CM, Job Training Facility CM

– Bovis Lend Lease Japan• Nihonbashi Hotel Project

– Overseas Bechtel, Incorporated• Shiba A-2 Block Project

– IBM FM Dept.• Mabuchi Motor HQ Redevelopment

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Insurance Company HQ Refurbishment Project / Construction Management

Location : Seoul

Project Completion : 2010(Plan)

Purpose of the building : Office and Retails

Structure : Steel

Total Floor Area : 95,000sqm

CM Partner : Hanmi Parsons

Cost

Sch

edule

Quality

Concept ● ● ●

Design ● ● ●

Procurement

Construction ○ ○

Mitsubishi Jisho Sekkei CM Dept.

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New High School Construction Project / Construction Management

Location : Kochi Prefecture

Facility Completion : 2009(Plan)

Purpose of the building : High School

Structure : Steel, RC, with Seismic Isolation

Total Floor Area　：　 17,745sqm

Cost

Sch

edule

Quality

Concept ● ● ●

Design ● ● ●

Procurement ● ● ●

Construction ● ● ●

Mitsubishi Jisho Sekkei CM Dept.

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Office Building Complex / Construction Management

Location : Tokyo

Facility Completion : 2006

Purpose of the building : Office Building and Retails

Structure : Steel, SRC

Total Floor Area : 97,592sqm

PM Consultant : Mitsubishi Estate

Cost

Sch

edule

Quality

Concept ● ● ●

Design ● ● ●

Procurement ● ● ●

Construction ● ● ●

Mitsubishi Jisho Sekkei CM Dept.

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Job Training Center / Construction Management

Location : Chiba

Facility Completion : 2006

Purpose of the building : Job Training Facility

Structure : SRC, Steel

Total Floor Area : 33,548sqm

Cost

Sch

edule

Quality

Concept ● ● ●

Design ● ● ●

Procurement ● ● ●

Construction ● ● ●

Mitsubishi Jisho Sekkei CM Dept.

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Bovis Lend Lease Japan

• Nihonbashi Hotel Project– Client; Foreign Insurance

Company– Total Floor Area; 7,943

sqm– Completion; Aug. 2005– Architect/Contractor;

Takenaka Corporation– TIC; Not disclosed– Scope; Project

Management

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Overseas Bechtel, Incorporated• Shiba A-2 Block Project

– Client; Domestic Developer– Total Floor Area; 61,170

sqm– Structure; S/SRC, 17F-2B-2P– Office, Hotel Complex – Completion; Apr. 2002– Architect; Nihon Sekkei– Main Contractor; Kajima– Scope; Construction

management, Procurement, Design Management

38Total Redeveloped Area ： 42,000 sqm

ＭＴＣ

Old HQ

工場棟

プレス棟旧部品工場

グランド

ＭＤＣ

Parking Area

Ｎ

コンプレッサー室

発電機

受変電設備／非常発電機

キュービクル

井水揚水ポンプ中水用ポンプ

約２７０ｍ

約１１０ｍ

約１８０ｍ

約３００ｍ

約３５ｍ

New HQ Construction

1.New HQ building(19,000sqm) 3.Refurbishments / Landscaping

Seismic Improvement Exhibition Room

Interior /HVACRefurbished

2.Demolition of Existing Buildings

IBM FM Dept. / Mabuchi Motor HQ IBM FM Dept. / Mabuchi Motor HQ RedevelopmentRedevelopment

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IBM FM Dept. / Mabuchi Motor

Completion of New HQ Sep 2004 Grand Opening

Aug 2005