Broken Buildings, Busted Budgets

I wrote earlier this week about online meetings, of which one kind is the webinar. Thanks to Sergio Aranda of e-Builder for sending me a link to a recording of an e-Builder webinar featuring Barry LePatner, a US lawyer and author of Broken Buildings, Busted Budgets. LePatner shares his experiences and insights into what is wrong with North America’s construction industry.

It is an hour-long webinar, but it is packed with information, particularly for readers unfamiliar with the US market. For those short on time, LePatner shows the US AEC sector shares many characteristics with that in the UK:

  • a large number of SMEs
  • a low-bid mentality and associated low profitability
  • low AEC industry productivity (“half of labor costs are wasted due to contractor inefficiencies”)
  • construction industry IT spending lowest of all sectors
  • construction cost overruns plague the industry
  • global pressures on construction resources and costs
  • construction processes largely unchanged since the early 20th century, where each building is treated as a ‘one-off’ product
  • “High levels of asymmetric information” – very few owners know what it costs to design and build a project, and are often left in the dark by their project team as to the likely outcome
  • poor standard contracts (see Contract conflict post)
  • potential for building informaton modelling (BIM) to help overcome some issues

Update (25 January 2007): Daniel Castro sent me another link to a Barry LePatner event, with the Information Technology & Innovation Foundation in Washington, DC. See “How IT Can Help Fix America’s Ailing Construction Industry.”


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