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Nathan Wood is the Founder and Chief enabling officer of SpectrumAEC, a company that aims to transform construction and design by addressing the people and process barriers that prevent innovation opportunities.
Nathan and his team also help project teams and organisations to adopt change successfully through end user workshops and executive strategy sessions. He also supports industry progression through academic papers, conference presentations, and as president of the Construction Progress Coalition.
Nathan was first recognised as an industry thought leader in 2011 when he shared his award-winning implementation of virtual design and construction (VDC) while he worked on integrated project delivery (IPD) healthcare projects.
Nathan was once a full-time member of DPR Construction’s Innovation Team. There he worked with over 100 teams on projects ranging from small office renovations to $3 billion airport terminals in Abu Dhabi.
Aside from being an industry thought leader, Nathan is also considered an evangelist for industry progression. He has presented his unique perspective through conference presentations across the United States and the world, including BIM Forum Canada, ThinkBIM UK, and Autodesk University.
Some of Nathan’s specialties include Virtual Design and Construction (VDC), Target Value Design (TVD), Organisational Development, Collaboration Coaching, Bidirectional Mentorship, Building Information Modelling (BIM), Lean Leadership, Healthcare Construction, and Digital Fabrication.
If you want to know an industry thought leader’s take on strategy, goal setting, and planning, don’t miss this episode. Nathan also tackled other interesting topics like shared pains, gaps in alignment, and culture so don’t forget to tune in!
Read the Transcript Here:
Welcome to the Construction Goals Podcast, where industry experts and leaders reveal the good, bad, and ugly about strategic planning. I’m your host, Santosh. We will dive into the who, what, when, and how of goal setting in construction projects. Most importantly, why you should care. Whether you’re a seasoned leader or a budding entrepreneur, you’ll discover something new in each episode about how to manage goals better in the challenging world of architecture, engineering, and construction. Let’s get started.
Santosh: Hey, Nathan.
Nathan: Hey, Santosh how are you?
Santosh: Doing well. I’m looking forward to our conversation today.
Nathan: Me too.
Santosh: So you know, we’ve been talking about how large construction projects and companies in the AEC space managed their strategic goals and objective and you worked across a broad spectrum. Really looking forward to hearing from your perspective what works well, what could be improved, where real value can be added through better management of goals. So, I hope you’re ready to get started.
Nathan: Absolutely.
Santosh: Before we jump in, can you tell me, you know, I know you’ve worked in a couple of different parts of the construction ecosystem, so can you give me kind of an overview of your background and the kind of companies that you’ve worked with?
Nathan: Yeah. So, the irony in all of it is that I had very broad experience but actually most of it is with the same company, so I came out of school through internships and graduating in 2009 with a civil engineering degree and went to work for DPR Construction. DPR is one of the top 10 general contractors in the US. They are one of the larger ones and a big upstart out of California in the Bay Area. I got to go out there and learn all about what the future cutting edge of hospital construction was with innovated project delivery and construction lien process and I’m sure you’ve learned BIM (building information modeling) and all the different use cases for that, the value and the data that comes out of it and really the potential. It’s a really cool experience and then got to take that project experience into the corporate side and join their corporate innovation team so that allowed me to see a bunch of different projects, bunch of different teams and kinda learn the differences between projects but also the similarities and their challenges and really where technology can fit but also where kind of culture and alignment and purpose are necessary. So, since then I have been doing consulting work through SpectrumAEC and we have a nonprofit, the Construction Progress Coalition, that I’m the executive director of where we are really trying to open up those conversations to understand the importance of data, the fact that data is actually supplied and received by two different people and starting to sort of understand their different perspectives and how we can come together to share data more effectively.
Santosh: That’s fantastic and with your advantage point of both working in industry and then also kind of taking a step back and seeing how the industry can work better, I’m sure you observe some patterns in how leaders and companies really approach planning, strategy, goal setting. So what’s been some of your observations if you would to draw some broad conclusions for us so we can kind of then click into that. How do you think companies kind of approach this, you know, who gets involved, how often is it done?
Nathan: You know, it’s been interesting and I think I certainly have a skewed perspective coming from DPR because they are one of the ones that had hired Jim Collins, if anyone has read Good to Great or Built to Last or any of those books to help them create their mission, vision and purpose and all these things that today is very much preached to general contractors of what is your mission, what is your vision, what are your values a lot of these family owned businesses can’t describe those. They never had to have those because it was just the family. Then so it’s been really interesting for a lot of these folks to really have to reassess kinda what is their purpose, what is their vision, how did they engage with a larger group of the organization that isn’t just sort of connected to the family especially if they have multiple offices. So I think it’s been a challenge for this industry but it’s been cool to see how a company like DPR has been able to do that and how to help others define first mission-vision-purpose but then get into, okay, how do you actually measure if you’re on the path towards that? What are those goals and how can we use technology and data to measure towards those goals without having to add more work on our already busy plates.
Santosh: Right. And DPR is not a small company, right? It’s a large company.
Nathan: Yes. But one that has grown fairly quickly because if you look across say the top 25 ENR contractors, I did this math a while back, but I’m sure it’s pretty close to the same, if you were to average all those out I think it’s around 93 years old is the average age of a lot of these companies and DPR I think is probably close to 30 years old; they started in 1991, so approaching 30 years now. They are young across those guys but have been able to scale extremely quickly and I think a lot of that is because they had that kind of common and aligned mission and vision. They had those stated goals and they had measurements to ensure that they are align with those goals.
Santosh: So, what are some examples of goals that you’ve seen in these companies?
Nathan: At the end of the day we talked about project-based goals versus corporate goals and so if you got a project level, from a DPR standpoint, there are 6 critical success factors (CSFs) that define what makes a good project. That spans from preconstruction estimating, to safety, to quality, to change management and closeout and so kind of across all of these different measurements, that again every company may have their own measurements and in those measurements we even change and evolve over time based on feedback and different ways of measuring, but I think understanding how projects are measured successfully and then how that turns into sort of the financial and economic success at a corporate level is an important distinction.
Santosh: So, I want to understand more about that distinction. So, are you suggesting that at a project level there’s a clearer sense of what the goals are but at a corporate level that does not exist or is it vice versa?
Nathan: Oh, I would say that the majority of contractors I just talked with understand at a corporate level what they define as successful, their NIBT or NIBBT but as far as projects, they don’t define it and I think that’s sort of part of what made DPR unique is that they had the understanding between project-based metrics, regional metrics and corporate metrics and the difference between them but also how they correlated.
Santosh: And do you think that’s kind of an anomaly in the industry that other companies would not define goals at a project level?
Nathan: I’d say most of their competitors probably do, you know, again I can’t put words on any of their mouths, but you know, as you start going down the list and you’re looking at more of your midsize regional contractors and those that haven’t really had to extend outside of one or two different offices, usually their mentality is actually restricting their ability to grow because they can’t really process things outside of having one central office to control everything and it’s actually holding them back.
Santosh: So, you know, let’s look at an environment where you saw a lot of alignment and may be this is DPR, so from top level down to the field workers and lets try to understand the cadence and what factors contributed to this? So, how did that really look and feel in people’s lives and what created that alignment from corporate down to the field?
Nathan: You know, it’s so much that has to do with culture. I actually recently attended the Procore’s Culture Academy and LV Hanson was there. He talked about this idea of culture. If you could define it in one word it is language and the ability to extend from a corporate vision and the mission and those metrics down to regional leadership and that communication, how that makes it down to the project level. It takes a lot of investment and early onboarding of employees and getting them to understand and speak the language of the company and understanding the importance of why you put in your monthly status report data and how that data shared more transparently and how that changes the culture of how we are measured because a lot of the companies where you don’t share the update transparently and it’s looked at as more of a managers and leaders go prying rather than transparently sharing data. There’s a huge aspect to again just culture and communication by directional sharing that really supports that from happening.
Santosh: And you’ve spent a lot of time studying of what you’ve referred today maybe you coined the phrase of shared pains in the industry.
Nathan: I’ll have to give credit to Kris Lengieza who is now over at Procore, but yeah, from shared pains to shared gains is sort of our motto.
Santosh: Oh, that’s nice and what would you say about have you observed any kind of common pains that wouldn’t link back to the lack of this culture that you just talked about or they are more tactical?
Nathan: No, no, I definitely think that they are. I think it’s interesting where we start to learn why we’ve measured certain things like safety or like quality because what happens when you don’t measure them, bad things happen. And so I think there is this constant kind of reminder that is one part cultural but also one part tactical of how do we apply the appropriate amount of measurements now that so much of our lives are tied to technology and we can start to control the way technology works. We can use it to our favor but we can also use it to our detriment in creating a bunch of roadblocks or ways if people don’t want to use the technology then we don’t get the data and we don’t get the value from the technology, so it’s an interesting balance.
Santosh: Yeah and one of the things I’m specifically interested in is looking at the flip side of there may be a few places where there is a lot of alignment but there are several where there are gaps in alignment across levels and the manifestation of that could be some of the shared pains that you are talking about, but let’s look at that in a little bit more detail. So, if you look at some of those environments where there are these gaps of alignment and there are these pains that are felt, what do you think has caused that and how does that affect people’s lives?
Nathan: Yeah. That’s where I think it becomes really interesting. The conversation between project based shared pains and those corporate level shared pains. So if we start with the project level, the root cause of a lot of those shared pains is that at the end of the day contractual incentives and this sort of adversarial nature of how architects and engineers and contractors and subcontractors and owners build their relationships in traditional design build contracts and so the more we move towards design build and integrated project delivery, I think the more we’re gonna start to close that gap and actually serve a need for a common data environment for a project and everybody to kind of share data more transparently and more fluidly with something like that so that’s kinda step one. But on the corporate level, I think again that goes back to culture of again how do we measure success as a company and how does that roll down to project level and then how do we accept that because every project is different, because not every project is gong to be IPD, how do we have a flexible strategy that says at the end of the day we as a company measure ourselves by A, B, and C but, you know, we recognize that we’re gonna take every project as unique because every project is unique and figure out how to work strategically and tactically to get the data correctly for both the company and the project.
Santosh: So, at a corporate level, how would you say that a system of goals or a system of strategic planning can help create the right culture?
Nathan: You know, this goes back to a lot of conversations we, (Chris and I) had at conferences about the difference between performance based standards and prescriptive based standards of, you know, we don’t have to live in a world where I’m gonna tell you exactly how to do it because when there was one file cabinet and everybody had to look at it at the same way it made sense to organize the data one way, but now that we live in this technology driven everybody can have different views of the same data that’s customized to them. What matters more is to establish these performance based standards as a company that says “I don’t really care how you get the data here but it needs to end up being here in this said format” so that we can have these consistent analytics and reporting or whatever but how you go about getting that data here because your project is different and your preferences are different or whatever, here’s your Baskin-Robbins 31 flavors of how you want to do it. But ultimately it’s still gonna flow back to their data system.
Santosh: So, you know, let’s look at kind of four different dimensions, right? And I love to get your perspective on from the organizations you observed, rate them on a scale of 1 to 10, 1 being abysmal, not developed and 10 being very mature, right? And the four dimensions really are how an organization defines their goals, second dimension being how they communicate that across their levels and functions, the third being how they track goals to closure and the fourth being how they assimilate learnings and improve on their strategic planning process, and we will go into each one. So, starting with the first dimension of how an organization defines their goals and if you look at, I don’t know if it’s easier to look at the overall AEC industry or will you get different answers if you look at a population of GCs and a population of architects and a population of engineering companies?
Nathan: From an industry level, I am curious I mean we can look even just look at the RFI workflow for example, like how do you define as an industry what is the right number of RFIs? Is that even the right metric for an RFI because there are folks out there that would say, a request for information is a bad thing and that we should just get rid of all RFIs but what you’re basically saying is we should get rid of questions, we should get rid of collaboration. So, we are not always saying the right things when we say I wanna eliminate something like RFIs. We need to really transform as an industry how we perceive what an RFI is, what is a value added RFI versus a value detractor RFI that’s more of the vindictive I’m gonna right this RFI because I know I’m gonna get a change order off of it that’s gonna make me money, you know, we wanna track and reduce those, but encourage more of the earlier in the process RFIs. So, it ultimately comes down to how do we change the measurement of what makes a good RFI which has to do with you know when did that RFI get asked, how long to take to respond and what was the impact from that response. That’s just one example and we could pick any workflow across the supply chain that we don’t measure correctly. We measure them for contractual and cost purposes, but I think today we are either measuring cost or measuring schedule or safety or quality but there are so many other things that we can be measuring that will be those leading indicators to those 4 major things we need to track until we get consistency there it would be hard to move forward.
Santosh: Right. You have to look at kind of what higher goal that serves and then design for that, right?
Nathan: Exactly, yeah.
Santosh: So coming back to that, you know, how good is the industry at defining goals? How good are organizations defining goals on a scale of 1 to 10, how would you rate that?
Nathan: Is it bad if I say less than 5? Well I think because at the end of the day, you know, construction will always use the excuse that it’s a low margin business and that, you know, it’s low overhead and really at the end of the day, it’s about how do you get the work done, make as much margin as you can and strip out any other sort of level of overhead. So, any sort of additional investment in measurement and tracking other than profit and loss is usually not really on the radar and it’s a little bit disheartening to come into some companies and do of these consulting workshops and ask them how do you measure success? And all they can really say is profit margin. And that is a reality of a lot of this industry.
Santosh: What about the next dimension of communicating their strategic goals out to their different levels and functions, on a scale of 1 to 10, where is that?
Nathan: For those that have them, it’s probably gonna be around the same. I think transparency in the industry is generally not super high. There is still a lot of deception in profits from that deception that go on. So, I wouldn’t say that the industry as a whole is very open to data measurement transparency, so probably again a 3 to 5 range.
Santosh: Okay. And then again for those who have the goals, how good are they at tracking them to closure on a scale of 1 to 10?
Nathan: So again those that have them, I’ll just use DPR as an example. I think they did have a pretty good culture of measurement to actually get those numbers in and get them reported and then I think the next challenge becomes qualifying those numbers. Just because you are enforcing that numbers get submitted is not the same as looking at those numbers and making sure that you didn’t actually put in that the job closed in the year 1901 when it should have been 2011 something like that and it skews the numbers off and it throws off all the graphs. But if nobody is looking at that data you won’t catch that. So there’s a difference between adherence and actual qualification of it. Again, I’d say it’s kinda yeah right in the middle, probably a 5.
Santosh: And what about goals that are not necessarily quantifiable or they don’t have a metric behind it but it’s an important initiative for the organization?
Nathan: Well, I guess would you qualify safety as part of that? Because honestly other than profit and loss, usually safety is the biggest measurement that you’d look for and I think it’s either one, your recordable incidents which directly relates to insurance which links to cost so you care about that. But what it really should be is are you measuring the pre-test planning and is everybody actually going through that thought process of thinking about safety before they are actually performing that work.
Santosh: Right. And that way you could try to warp any objective into a set of metrics and sometimes you have developmental objectives that are not metric constrained but they are more change objectives let’s say, right?
Nathan: Well, this gets into the conversations of me trying to understand the difference between an objective, you know, an OKR and a KPI, the actual measurement of it and so it’s something that I struggle with and I know the industry certainly struggles with also.
Santosh: That’s a great subject in of itself.
Nathan: Yeah, yeah. That’s for the next episode.
Santosh: So what about the last dimension of assimilating learnings and looking, let’s say someone has an annual planning process, how good are they at assimilating learnings from the previous planning process and improving their next cycle?
Nathan: You know, I think that’s we are seeing things pickup. I’m hearing a lot more and participating more in these leadership summits where they are bringing folks together and doing strategic planning and coming up with some of these measurements. So, I would probably rank that much higher, you know, 6, 7 or 8.
Santosh: That’s great.
Nathan: And so you are seeing a lot more of that. It’s just becomes a question of what is the quality and kind of reality of what comes out of those and how much can we really take off from those strategic workshops and actually move them to implementation phase because that’s obviously the hardest part.
Santosh: So if you look across these 4, you gave fairly poor scores to the first 3 but a better score to the fourth one, right?
Nathan: Mm-hmm.
Santosh: And where does the rubber actually meets the road in the sense that is it really worthwhile for companies in AEC to try to move the needle in any of these areas or is there a lot more low-hanging fruit for them to go after so this is not as worthwhile. What’s the real value in trying to move the needle in any of these areas?
Nathan: I think any company that does not currently have a set of key performance indicators, critical success factors, or key objectives for both their projects and their company. I mean that’s really step one in understanding what data do you need in order to know that that thing is on track. Coming into the construction progress coalition and what we are trying to do to connect data between different companies sort of that prerequisite to being able to have a common data exchange setup at a project level between an architect and a general contractor means that both that architect and that general contractor have to know their objectives, know the data that they care to measure at the project level that aligns to their corporate goals and then be able to communicate effectively the technology platforms that they are using in order to capture that data and how they do or do not integrate with the other systems that are required on that project so we can more effectively collaborate in exchange data. There is a ton of work that any company can be doing right now to really refine how they measure success and how their technology stack aligns with those same success metrics and create those win-win scenarios.
Santosh: Let’s try to make it more immediate, right? Let’s say a leader of a GC or any firm runs into you and just says, “hey, Nathan tell me why should I care about this? Why should I wanna improve the way that that is strategic planning and I need an answer in like 10 seconds”, what would you tell them?
Nathan: If you have any interest in scaling your business that there is really no way to effectively scale your business without an aligned strategic plan and clear communication of what those objectives are and that they are believable, they are achievable, and that folks are rallied around them and committed to them. Because so much of today is millennials becoming the majority of the market place. They are all about purpose and if they don’t feel a sense of a purpose and understanding of why they are doing what they are doing and having aligned strategic goals and being able to effectively communicate them in a way that’s compelling to millennials is how you scale your business. Unless that company is comfortable staying stagnant and does not want to grow and does not want to have new employees, you really need to be focusing on this stuff.
Santosh: Are there any changes happening in the industry now to make this more important for companies and leaders?
Nathan: So, I mentioned before Procore is doing their culture academy which I think is a very interesting and noble approach as a software company to say: “Hey, Guys as an industry and as executives we need to focus more on culture”. I think there are more and more events and peer groups. FMI does a really good job of creating peer groups and even some of the events, that if you’re more technically minded, that CPC is doing are trying to really bring together those like minds to come up with some of these more common strategic goals and really communication strategies for how you go back and talk to your managers or talk to other project stakeholders about these goals and ultimately the data that can measure those goals, so I think yeah there’s a lot of areas.
Santosh: So, there are so many goal setting and strategy frameworks out there and a lot of wisdom, you mentioned Good to Great and that’s kind of trickled down to the industry, but yet there are also doesn’t seem to be enough adoption or awareness or in many cases even interest in really investing in how you approach strategic planning and goal setting, what do you think infrastructure leaders and project managers really need to actively implement a mature goal setting framework in their teams?
Nathan: Bring in the experts right? I think the fact that folks are having these strategic leadership summits are great and a lot of them usually are because they attended something where they were really uninspired and then they thought that they could put it on themselves and it would be great. A lot of times those will fail and not produce the intended results, I mean not to tip the hat over but I think bringing those that are experts in facilitating this sort of stuff and really getting that consensus and holding the accountability because I think it’s down to the company to decide these things but they are not easy decisions to make and so kind of admitting where we have expertise and where we don’t and bring in those to support us is how we are going to start to move forward as an industry.
Santosh: So, do you think it really is just a question of awareness and expertise and it’s not any systemic unwillingness or inability to invest on this part of the business on how you plan?
Nathan: Well, I mean I think stereotypically as a construction industry, I think there’s gonna be a little bit of a cultural aversion to dealing with culture, no pun intended, but it’s gonna be tougher. The more that we bring these outside design thinking, goal setting and lean and these other alternative concepts into the construction industry, the more familiar it becomes and the more it engrains itself in the culture but certainly there is and will continue to be a little bit of that culture shock as we go through it.
Santosh: I’m glad you mentioned design thinking and lean and similar methodologies, how have you seen them sort of enter the industry and gain traction? What pockets are the most amendable and where do you find the most willingness and freedom to really experiment with these?
Nathan: So the term lean coming from manufacturing is definitely the one that’s gotten the most traction in construction and specifically something called The Last Planner System which is a production control methodology essentially for field projects and field project teams for how you manage all the different trades and how they communicate more effectively. So, there are pockets were that’s being adopted but I think what ends up happening is it builds its own label and stereotype but then people say, you know, the only thing that’s lean is this last planner system whereas that is just scratching the surface of all the different aspects that came out of Toyota that make up lean, that make up Agile if you’re in software development or argue some of the concepts even within design thinking of how do we think both bottom up and top down and understand these principles. That’s a lot of what I’m kinda preaching is that lean is not just this last planner system with some sticky notes, I mean yes that is an important first step but understand that there is so much more to it than just that.
Santosh: So where do these leaders sort of gather, what’s their water cooler to exchange ideas and best practices, not necessarily in BIM and construction specific techniques but more organization culture? You mentioned Procore and their culture academy, are there are other similar things happening?
Nathan: I mean I think even within those who are the thought leaders within this space whether it’s the typical conferences, your major software conferences and your major industry, you know, AGC/AIA conferences where folks are meeting up there but there are groups kinda like within Slack and frankly podcasting has been a great way or these voices to get out and to be heard. I wouldn’t say that there’s kind of like a concrete place and there’s probably not even really an organized group within specifically this area, but you definitely see them at conferences and we find our ways to communicate through the different social media platforms.
Santosh: Cool. And you’re just coming back from an event and it was labeled as Dork-A-Thon Construction Dorks. Can you tell us a little bit more about that? Does any of this sort of appeal to the construction dorks out there?
Nathan: Absolutely. So yeah, the term construction dorks has to be attributed to DJ Phipps. He is now at Haselden Construction here in Denver but is a recovered architect and now been working in the BIM and VDC world for a general contractor for a while but he got together through Travis Voss, who is with Mechanical Inc., so both representing GC and representing mechanical we are able to get group of both GC, mechanicals and technology providers for them to really talk about these shared pains, this interoperability breakdowns as a bunch of dorks. So the kind of the irony was it that it was a bunch of definitely construction technologists or construction dorks talking about why this technology is not working, so we talked very little about the actual technology and really the whole focus was on kind of the people and the process and the breakdowns that are occurring that those barriers that need to be addressed or the roadblocks that need to be removed in order to see this shared vision that we clearly all have and are kind of frustrated at what’s in the industry getting in the way of doing that.
Santosh: That sounds fascinating. Lastly, what advice would you have for leaders and project managers in this industry?
Nathan: I think listening and being present. I think there is just so much going on right now. The market is very hot and folks are looking for answers but they are not really listening for them. I think the answers are out there but they are not always the answers that we want to hear. So speaking to myself just learning the importance of patience and the importance of engagement with all these folks that are impacted by leadership decisions and taking time to make these decisions and getting folks input and then actually enforcing them is something that, anybody at any leadership level can do but those conversations are initiated first by listening.
Santosh: Absolutely and that’s an important skill. I wonder if in this industry when there are so much emphasis on getting things done, do people feel they have time to listen and time to make changes?
Nathan: That’s my famous line now is, “I’m too busy being busy to find ways to be less busy.” And that is just this industry in a nutshell right now. It’s almost heresy to encourage a next downturn so that we can finally slow down and innovate and deal with all these shared pains. But I guess if you talk to the economists that look for next year is still pretty strong. So, I don’t know.
Santosh: Unfortunately so, yes.
Nathan: Yeah. Somehow we’re gonna have to convince ourselves to build in the time to invest in this otherwise we may be sorry.
Santosh: So in many of the interoperability activities that you’re undertaking, you’re definitely asking them to take the long view, right? Do you get any pushback on that?
Nathan: Well, not upfront but I think, yeah, you definitely have to address the natural eye roll of, yeah, we all know we should do that but you almost have to draw those quadrants of the urgent versus important and identify where are all these urgent things or seemingly urgent but maybe less important and can we find ways to either use automation or use other things to get them off our plates and focus on more of these longer term important items because yeah it seems right now like the urgent is very much overtaking our ability to focus on these important items.
Santosh: Right. That’s a good way to look at it. Thank you so much Nathan. This has been tremendous.
Nathan: Yeah. Thank you Santosh, great questions.
Thank you for listening to this episode of the Construction Goals Podcast. I’d love to hear about your experience with goals and strategic planning, or answering questions you may have after listening to the show. You can e-mail me at santosh@goalcheck.in, or visit www.GoalCheck.in to submit any feedback or questions. I look forward to hearing from you.
Thanks for listening!
Thank you for listening to this episode of the Construction Goals Podcast. I’d love to hear about your experience with goals and strategic planning, or answering questions you may have after listening to the show. You can e-mail me at santosh@goalcheck.in, or visit www.GoalCheck.in to submit any feedback or questions. I look forward to hearing from you.
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