Podcast: The Building BITE
Episode: 4 Opportunities to Improve a Contractor’s Prequalification & Subcontractor Selection Process
Tune in to The Building BITE Podcast, as we hear from industry experts about key topics to help you be successful. In this episode, hosts Peter Duggan and Mike Diercksen welcome Jeff Nolan, Risk Engineer at Cove Programs. Jeff shares four opportunities to improving prequalification and subcontractor selection processes for contractors to maximize success on a project. By following these opportunities, GC's are better positioned to see improvement in their subcontractor performance and avoid subcontract defaults.
Growing up in California, Jeff shares his career journey after graduating from the University of California, Davis. From Bechtel to Zurich and now Cove, Jeff has worked globally in Dubai, The United Arab Emirates, London, and Germany.
Leveraging his global expertise, Jeff shares his view of the main differences between SDI and surety bonds. According to Jeff, the "...key difference is that in the case of surety, the surety companies do the vetting of the subcontractors that they're providing bonds for. Whereas in SDI world, the SDI customers are the general contractors. They're the insureds, and they're the ones doing the vetting of the subcontractors that they're contracting with."
Turning towards the main topic, Jeff provides listeners with four steps to improving a contractor's prequalification and subcontractor selection process:
1. Don't do Prequal in a Silo or Vacuum
If a contractor goes through the prequalification process in a silo, they fail to take advantage of the feedback loop; significant information on a subcontractor's previous experiences gets shared with people who are interested in knowing.
2.Develop a Risk Mitigation Process
By doing so, the GC will monitor the risk and be prepared to act quickly and decisively should the sub begin to fail, potentially saving them from an SDI Claim.
3.Consistently Apply the Developed Processes
It is key for the general contractors to have a "clear understanding of what happens when things are outside of limits and how they will be addressed." A GC is more likely to overlook potential problems with the sub if they are not consistent with their risk mitigation plan.
4.Capture the Lessons Learned
Through lessons learned, a GC can evaluate the process and determine what is driving optimal results. Lessons learned documentation would also help general contractors improve their risk mitigation practice and add quality information to the feedback loop for future projects.
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