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The Funding Authorization Trap

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The Funding Authorization Trap

Posted by Tom Richert Lean Projects
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money-1428594_1280Among the many reasons Integrated Project Delivery (IPD) projects are successful is that there is an intense focus on bringing on the talent needed to build the project early in the planning process.

Some owners, particularly in the public sector but also in some private enterprises, use funding authorizations to manage the release of subcontracts on large projects. In these cases it is not unusual for subcontracts to not be authorized until shortly before those trades are needed on site. As a result important players are not on the team when planning should begin, and make ready work needs to be underway.

The waste is considerable, even when the construction team is working diligently to employ Lean practices. Such waste is reflected in the cost of the project. Policy makers, in the public and private sectors, are advised to take a close look at whether they have a funding authorization process, official or unofficial, that traps their enterprise into paying more than necessary for a project.

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About Tom Richert

Tom is a frequent speaker, workshop facilitator, panel discussion presenter, and university guest lecturer on topics of collaborative productivity, team culture and alignment, lean management, and project leadership. He lives outside Boston with his wife. Their daughter is a stage management major at Ithaca College.

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