A report shared by the Labor Management Committee of the Leadership Council Southwestern Illinois reveals that the collaborative project management process being used on major construction projects in Southwestern Illinois is a win-win for stakeholders.
Developed over the past 30 years by labor and management, the proven model that’s been tested and refined combines project labor agreements (PLAs) with a tripartite approach that unites contractors, owners and labor at the table, resulting in a process that increases collaboration, reduces costs and brings projects in on time and within budget with excellent safety records.
The independent research was conducted by Ronda Sauget and Marv Finkelstein, who volunteered their time. The purpose of the study was twofold: to provide a framework for understanding the historical context of labor-management cooperation and collaboration in Southwestern Illinois, and to empirically document six business cases in the construction industry over the past decade that used the combined PLAs and tripartite model.
“The findings of this study refute the myth that the use of PLAs adds to a project’s cost, at least here in Southwestern Illinois,” said Ellen Krohne, executive director of the Leadership Council Southwestern Illinois. “Furthermore, the six case studies documented as part of the year-long study provide such compelling evidence of the effectiveness of the combined PLA-tripartite approach in meeting budget, schedule and safety goals that others may want to consider bringing their projects to Southwestern Illinois.”
The projects detailed in the report include the $4 billion Prairie State Generating Campus and the Phillips 66 $3.8 billion Wood River refinery expansion. The others were Alberici Constructor’s $74 million project to construct Abengoa Bioenergy Co.’s ethanol plant at America’s Central Port; multiple projects totaling more than $60 million within the Edwardsville School District; the $11.4 million SIUE Student Success Center, and the new $29 million K-12 facilities for West Washington County School District 10.
The study’s findings and conclusions were:
All six projects reported highly positive results and mutual benefits from engaging in cooperative labor management agreements and practices for the stakeholder groups — owners, contractors and labor.
The use of PLAs and related tripartite agreements resulted in significant cost savings, improved quality, greater productivity and higher levels of safety.
There was no evidence to suggest PLAs contribute to higher costs and reduced competition. To the contrary, successful PLAs tend to produce short-term and long-term cost savings. Results indicated that all six projects were completed on time and within budget.
Cooperative agreements, such as PLAs and the Tripartite model, can increase communication, trust, respect and collaboration among all parties and encourage swift problem-solving, innovation and flexibility.
Positive results may be attributed to an informed and committed labor management leadership who were able to successfully resist an adversarial past to learn, create and maintain strong cooperative relationships.
Future success of the construction industry in Southwestern Illinois may well hinge on workforce and leadership awareness of cooperative and collaborative agreements and practices.
The labor force required to successfully deliver these projects consisted of more than 10,000 skilled tradesmen working for local and national contractors, who collectively completed more than 50 million site work hours. Those numbers underscore that this approach can effectively provide local contractors and skilled tradesmen the opportunity to work on local projects.
The study concludes by identifying recommendations and next steps for the Leadership Council, its Labor Management Committee and other regional partners. Among those are promoting greater awareness of the use of the PLA-tripartite model, and developing new training and educational programs that focus on cooperative and collaborative practices. With an eye to the future, the study authors suggest developing a strategy to encourage and support more vocational and STEM education programs and promoting the construction trades as a strong professional career option; and ensuring that both labor and management continue updating their respective technology skills as this industry segment grows more complex. The Leadership Council’s Manufacturing Steering Committee is already engaging on those issues, with specific efforts set to ramp up in the coming months.
For information on The Leadership Council Southwestern Illinois, visit www.leadershipcouncilswil.com.