Harvard has won a CoreNet Global Innovator Award for its success in managing capital projects and controlling risk.
CoreNet Global, the world’s premier association for corporate real estate and related professionals, gave Harvard the award in recognition of its successful implementation of the Performance Information Procurement System (PIPS), developed by Dean Kashiwagi, founder of the Performance Based Studies Research Group (PBSRG) at Arizona State University’s Del E. Webb School of Construction, and tested by Harvard Real Estate Services (HRES) and other construction groups throughout the University.
A computer-based information-gathering and decision-making system, PIPS allows facility managers to get a better sense of the project before awarding the contract and to select the right contractor for the right job at the best value. The system has been tested for more than 13 years, with documented results on 240 capital projects valued at more than $300 million.
Harvard undertakes about 180 capital projects each year, representing $400 million. These are projected to increase to more than 200 projects, valued at more than $600 million annually.
Capital projects are currently managed independently by four groups – three of the larger schools and HRES. This decentralization can often result in a lack of consistency and information sharing, uneven vendor performance, lack of consistent performance measurements, and an absence of management standards to mitigate budget, schedule, and quality-related risks.
In testing the PIPS program, Harvard has found it to be effective at managing small capital projects by stimulating greater competition among vendors, encouraging high vendor performance, and significantly reducing the risk of cost overruns and schedule changes.