...grid so that players on both sides can quickly reference it. The cost of FMI’s services depends on the expected return on investment. FMI will charge anywhere from 15% to 30% of the savings realized or value of the performance enhancement, depending on the size and complexity of the situation.

The Extended Enterprise: A Success Story

Ten Steps to Collective Process Innovation
What Needs to be done
How to Do It
Senior Management Commitment
Establish common vision Refer to success story paradigm
Build trust Open communications
State transition Define transition plot point
Intra-Organization Framework
Connect brainpower & process Connect operating styles
Align communications Audit formal and informal channels
Engage key players From what, to who, to how
Create EE innovation plan Refer to success story paradigm
Manager/staff breakthroughs
Stimulate ideas Generate and bank ideas
Start rapid process innovation Practice smart communications
Enact/track plot points Refer to success story paradigm
Source: FMI

Building Success

Montgomery Watson Harza, Broomfield, Colo., and Sacramento Regional County Sanitation District, Calif., reaped the benefits of the program on the 10-project, $593-million Lower Northwest Interceptor Program. MWH acted as program manager for SRCSD. MWH had to manage personnel from SRCSD, five contractors and the construction management firms. Before the projects got under way, teams were composed of players from all parties.

George Heery: Building Contractual Bridges
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  • “We used collaborative teams day in and day out, rather than periodic meetings,” says John Buttz, MWH vice president and program manager. Cross organizational teams were used at all levels of the organization, including at the first level where contractor foremen, the district’s resident engineer, MWH’s field engineers and the construction manager worked together on a daily basis. “They worked together to come up with some great solutions and they had negative change orders,” says Buttz. The success on projects where partnering was fully embraced will allow the program to wrap up in June $23 million under budget and on time. “The program would not have gone as well if we had not put in the work beforehand,” says Buttz.

    Eric Allen, principal engineer, SRCSD, says that the methods used by FMI proved to be a more effective approach to partnering than he had previously encountered. “FMI brought a focus on getting the job done. Some partnering firms only want to focus on the relationships,” he says. “They wanted to figure out what are going to be the roadblocks and what is the best way to remove them from the road.”

    Extended Enterprise is most at home in situations where owners need services for long-term or indefinite programs. Nicor Gas, Naperville, Ill., hired FMI in 2004 to facilitate alliance building with two contractors. As the process became more refined, Nicor found that one of its key cost metrics declined. At the same time, Nicor handed over more control to its contractors, allowing them to do the work most efficiently.

    “We want to enter into long-term relationships. They are very comforting. They also improve performance not only in terms of profit, but also efficiency and utilization of resources,” says Rock McHenry, vice president and chief financial officer for Northern Pipeline Construction, Phoenix, a Nicor partner. “Typically the contractor-utility type of relationship has never been built on trust,” he adds.