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Article - February 2004
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One of our sixteen is missing …  or can Integration be specified?

 

John J. "Jack" Mc Gowan, CEM
Energy Control Inc
.
Contributing Editor

or can Integration be specified?

 

The intent of this vignette is to provide anything but an update on the state of the art in writing specifications. I will leave that to the Construction Specifying Institute (CSI) ( www.csinet.org ), and others who are far more knowledgeable in that area. What this article does try to do is reinforce the fact that there is a disconnect between the direction that many of us believe the industry is headed, convergence, and the process of procuring services that allow for this integration to be implemented.

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First an aside on the title. I live in a little known, sparsely populated state, New Mexico, which shares part of its' name with the neighboring country to the south. A running New Mexico joke is that quite often residents of this state are treated like visitors from another country, when interacting with people from other parts of the United States. New Mexico Magazine runs a monthly column called "One of our Fifty is Missing" to share relevant stories. For example one of my children recently applied to graduate school at a State University in the eastern U.S. Soon after receiving the application, they sent out a letter welcoming the new International applicant. Hence my title picks up on this phenomenon and draws a parallel to specifications. In much the same way, members of the construction industry, and design community at large, often experience confusion due to the complexity of specifying Integration. This is exacerbated by the fact that it requires products and services that cross over the traditional boundaries of work that are encompassed by construction specifications. With all good intentions, specifications that I read often make simple mistakes that have huge impacts on the overall quality of the process. Hence one of our 16, Integration, and the services that it requires, is missing.

Integration presents challenges to the construction procurement process on numerous levels. The industry is demanding integration throughout the enterprise from building automation, fire alarm, access and video surveillance for security to Enterprise Energy Management, Metering and Maintenance Management. Integration goes beyond independent building systems such as those listed above, because it requires commonality with building application infrastructure including: hardwired and wireless LANs', central databases and even network-client software among others. In the last few months, I have reviewed more than a dozen Requests for Proposals and Specifications asking vendors to provide systems that integrate many or all of the above systems. Some of these have been solicitations independent of construction and some have been part of construction specifications. Set aside the flaws that might exist in any of these specifications because of a lack of understanding of the independent systems themselves or the complex interaction that must be achieved between all of these systems and the host of generations thereof. The fundamental issue raised here is that those solicitations that are done as part of a new construction process creates divisions between the various trades, tasks and scopes of work to be carried out.

There are two simple problems with the traditional specification process. First the 16 divisions in a specification are no longer appropriate for building systems because the same integrator must provide work in more that one division for the implementation to be successful. Second, the word integration by its very definition means combining functions between multiple systems. The net result, if contractors bid projects, as they must to meet a specification, is that there is an endless finger-pointing contest, and no one has either the responsibility or the opportunity to ensure that all of the systems truly work together. Of course this is part of the reason that many industry professionals are advocating a Division 17 to create a way to specify responsibility that extends across the traditional boundaries. I applaud that effort, but remember that there were not just traditional building systems listed above but also information systems.

Reliable Controls I believe that Intelligent Buildings, which embody convergence of building and information systems is the goal. In that context, the challenge of making systems, that have been bid in the traditional model, work will become even more difficult, if not impossible. Well, by now many readers are thinking that none of this is new, and asking what is the solution? I would like to pose four options to consider. Perhaps there is nothing unique in this material, but using these approaches my company has experienced triple digit growth over the past few years.

Design build is a popular approach, and many integrators are migrating in that direction. My company did about $2 millions in design build projects last year that included all of the building and information management systems discussed here. This does require a completely new set of sales skills and it may not be an option in some states and for some customers, such as public entities, but it is worth exploring.

Creative procurement is the second option to consider. This solution requires integrators to explore contract vehicles that allow customers to meet procurement requirements with going out to bid. This allows them to do a design build type of integration project. Some examples are cooperative procurement entities that act as buyers for school districts, state governments and other users groups. This works much like a General Services Administration (GSA) procurements for Federal customers.

A third option can work if your company has a solid relationship with a particular customer. Request that a customer exclude the integration from their specification and issue a direct contract. For this to work it requires that the customer have trust in the integrator relationship and that they also are able to again address procurement using a vehicle such as the ones above. At times this may also be done as a sole source procurement, particularly if the combination of products and services to be provided are considered unique or an extension to an existing system.

The fourth option involves teaming with other companies. Many controls contractors and integrators have teamed with ESCO's with varying success. This requires a great deal of due diligence on the contractors side because typically there are no change orders allowed in performance contracting and this puts additional pressure on the ESCO to manage projects and costs often to the detriment of subcontractors. The theme of this discussion however is creativity, and ESCO's are not the only option. It also makes sense to identify a relationship with partners that are offering unique services, which require controls. In this way the partner may be able to severely limit competition and pull the controls through. This strategy demands quality, but many contractors would welcome the opportunity to do the job right and still be able to earn a reasonable margin on the project. Here are two examples of this type of teaming that relate to Green Marketing. Team with companies that are offering mechanical systems that are perceived to be green such Geothermal (ground coupled water source) Heat Pumps, or with a consultant that is focusing on LEED (Leadership in Energy and Environmental Design) projects. In both cases it is possible to bundle controls with the mechanical and other work to sell as a package, thus creating a win for the owner, the partner and the integrator.

CatNet Systems To come full circle back to the original issue, perhaps what is required is also to reengineer the entire construction procurement process. This is quite a bit more ambitious. The best approach might be to create a new trade "integrator" that can bid all of the systems within a building as a bundle and become a single point accountability for ensuring that those systems operate both independently and together. This may be what is conceived in Division 17, however I do not believe that it envisions the scope of Information Technology (IT) related work that is required for integration. As we all know IT companies like Hewlitt Packard are already entering the Building Automation space, and their efforts may completely preempt Division 17 and other such initiatives.

The jury is still out on the best approach to deal with these issues, but time and the market march on. In the Marketing Convergence Editorial Supplement in November's Engineered Systems, I made a fairly bold prediction. I said "…my conservative estimate is that 75% of today's "control contractors" will cease to exist if they do not dramatically change their business models over the next decade. The context of that supplement was technology and the need to embrace convergence, but the same prediction applies to this whole discussion of how Integration is sold. My recommendation is that integrators should not wait for construction specifications to change; rather they should seek out ways to change the specification paradigm. In the end this problem, like every building, will be designed and implemented one project at a time.

Further, redefining the entire Integration Sales process can bring dramatic benefits to integrators as well as to owners. Remember the entire premise of this article is how to implement successful systems that are poster children for integration so that everyone wins. Ultimately the answer to my question: "can integration be specified" is yes, but I think there are many other ways to achieve the same goal. My recommendation is not to abandon any option that can result in the right integrator teaming with the right owner to develop successful projects.


About the Author

John J. "Jack" Mc Gowan, CEM is author and is President of Energy Control Inc., an Energy Service Company and System Integrator. Mc Gowan has worked on numerous multi-million dollar projects in every capacity from design through financing as an end user and ESCO. He has published 5 books including "Direct Digital Control" on Fairmont Press. The Association of Energy Engineers named him 1997 "International Energy Professional of the Year" and admitted him to the International Energy Managers Hall of Fame in 2003. He is listed in Who's Who in Science and Engineering, Millennium edition, Marquis Press. Mc Gowan sits on the Energy User News (EUN) Technical Advisory Board and is Editor of the Energy Online Series for EUN. He is a Contributing Editor with www.automatedbuildings.com.


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