Questions to Mr. Dean E. Stephan, President, Charles Pankow builders, ltd., Altadena California

TECHNOLOGY TRANSFER

Questions to Mr. Dean E. Stephan, President, Charles Pankow Builders, Ltd., Altadena, California Jan P. Skalny Consultant, Timonium, Maryland Question: Would you be so kind as to briefly tell our readers about your present responsibilities: in the industry, particularly at Charles Pankow Builders, in the American Concrete Institute (ACI), and in other construction-related organizations. Mr. Stephan: I am president of Charles Pankow Builders. We are a design/build construction firm specializing in commercial construction. Our annual volume is approximately $450 million. Our projects currently range in size from a $Y2 million restoration to a $200 million 2.2 million SF office and transit complex. The projects stretch across the United States from Long Island, NY, to Honolulu, and San Diego. The company's hourly and salaried payroll currently numbers approximately 500. Just about all our work over the years has been negotiated contracts for the private sector. I am currently president of ACI. The term is for one year. My 20-year involvement with ACI has involved membership on technical and board committees, chairmanship of 117, TAC and TAC Technology Transfer committee, and membership on the Board of Direction. In addition to the presidency, I am currently on 318, the Board, the Executive Committee, and the International Activities Committee. In addition to ACI, I have been involved with ASCE and CERF. Within ASCE I participated in the development and implementation of the Manual for Quality in the Constructed Project. With CERF I participated in the founding of the Corporate Advisory Board and currently chair that board. I am a director of CERF.

Question: Do you consider the adaptation of new technologies and their fusion with existing technologies to be a problem within our construction industry and, if yes, what are the reasons for this situation? Mr. Stephan: I do consider the adaptation of new technologies to be a problem within our construction industry. There are many reasons, all resulting from (1) economic incentive and (2) risk control. From an own-

Address correspondence to Jan P. Skalny, ACM Editorial Office. © Elsevier Science Inc. ISSN 1065-7355/94/57.00

er's and investor's point of view, use of unevaluated new technologies constitutes an unacceptable risk. Evaluated technologies must fulfill their investment and ownership strategy. Owners/investors, including government, are not willing to be "guinea pigs." Procurement practices for the construction industry are generally based upon price only. The design of construction is generally procured separately from the execution. Designers do not have a financial incentive to utilize new technologies. In most cases, n e w technologies increase the designer's cost and risk of doing business without financial reward or benefit. The constructor has marginal ability to introduce new technologies because he is divorced from the design. In the U.S., construction contracts are prescriptive rather than performance based. The constructor can only execute the work in accordance with the documents he has contracted against. N e w technologies, providing economical efficiencies which are executional in nature (means and methods) can be and often are adapted and fused with existing technologies by contractors. Question: In what respect are the technology transfer mechanisms practiced in North America different from those in other countries, for example in Japan, Germany, and France? What are, in your view, the positive and negative aspects of these different approaches? Mr. Stephan: I would commend you to CERF's reports on Europe and Japan on this subject. They cover the issue in great detail. In both Europe and Japan there are mechanisms to (1) evaluate new technology, (2) control the risk associated with the use of new technology, (3) their procurement systems which provide financial incentives for their construction industry to develop new technology for use. In the United States these three facilitators of technology transfer are deficient in varying degrees. In the U.S., research which leads to new technologies is generally funded by government and performed at academic institutions. All without industry involvement. The result of the investment (the deliverable) is a technical paper. All too often the research performed in the United States is developed and applied by the Japanese and European construction industry.

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If we can address the issues of evaluation, risk control, and return on investment, we will see the U.S. construction industry investing in research. If industry invests in research, then technology transfer occurs because it is the mechanism to achieve the required return on investment. In Japan and Europe, evaluation is p e r f o r m e d through g o v e r n m e n t involvement. Risk control is achieved through legal and insurances accommodations in Europe and, in Japan, through its social structure. Economic incentive is provided by design/build contracting and procurement practices which feature "best bid," prequalificafion, and performance (rather than prescriptive) criteria. In the U.S. we have demonstrated that technical papers and presentations are an ineffective method of transferring technology.

Question: What services, if any, should ACI offer to the construction industry to enable increased knowledge transfer to and by the engineering community? Where do you see the main ACI-related institutional barriers, and what organizational or cultural changes should ACI consider adopting in order to become more effective? Mr. Stephan: This topic was the subject of a multiple page report issued by the TAC Technology Transfer committee that I chaired. There are several services b e y o n d ACI's wellrecognized publications that ACI can, and to some extent does, offer to the construction industry to increase knowledge transfer. • Development of educational materials dealing with the application of new technologies for both the designer and constructor. Development of training materials for the craftsman in the use of new technology. • Activation of the Concrete Research and Education Foundation and involvement of industry and integration of ACI technical committees into its other sponsored research. • Evaluation of innovations and new or changed concrete technology as to life safety and efficacy. • Research funding that includes technology transfer by funding the drafting of codes and standards relating to the technology so that technical committees can efficiently act upon new technology. • Providing chapter meeting materials with new technologies. The list of services enhancing knowledge transfer is perhaps unlimited. Unfortunately, the demand for services always grossly exceeds the available resources. The main ACI institutional barrier I see is in the area of codes and standards. As many have pointed out,

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markets (thus, technology transfer to practice) follow the first available standards. Development of standards substantially improves acceptance of a new technology because the standardization process involves detailed technical review and acceptance by industry. The problem arises in efficiency of committee development of standards or even reports. Eight to ten years from the conclusion of research would be a typical time period for an ACI committee to deal with a new technology. We need to move our codes and standards, where possible, to a performance basis rather than prescriptive. Performance-based codes and standards accommodate new and changed technology more efficiently. A new technology would only have to meet the required performance to be used. Prescriptive standards often have to be rewritten, an eight to ten year process, to accommodate new technology. We need to develop a culture which welcomes change and innovation. Too often, I think, innovation challenges our feeling of competence. It is viewed as threatening rather than as an opportunity. Investment in the "status quo" can be professionally expensive in the long run. The main organizational change would be development of procedures that would allow for standards to be based on science as well as experience and use. These procedures will have to allow for more efficient processes for dealing with new technologies. This will be a very difficult task within a consensus volunteer organization. Significant help and cooperation from the research side of the construction industry will be essential. Researchers will have to work with practitioners to develop the results of their research in a fashion that is useful to practitioners and can be efficiently dealt with by committees. This would be a greatly expanded purpose for most technical papers dealing with innovations and new or changed technologies.

Question: From your industrial point of view, what should be the function of the federal and state governments in promoting innovation and technology transfer by the industry? What are the things governments should not do and/or are unable to do? Mr. Stephan: Government has a special role to play. At the federal level, government can control some of the risk exposure of using new technology and, at the federal and state levels, government has access to qualified technical staff for technology evaluation relative to efficacy and life safety, the ability to circumvent inappropriate code and standard constraints, and the ability to provide impartial public domain long-term performance evaluation. In addition, as major owners of the constructed project, government has the opportunity to create financial incentives for technology transfer and innovation

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through their procurement system. This is done in Europe and Japan. Government cannot ignore the realities of the marketplace and expect through edict or broad dissemination of technological information to achieve innovation and technology transfer. If evaluation processes to determine efficacy and life safety and procurement processes are established that offer potential rewards within our competitive market system, innovation will blossom and the demand for technology to transfer will outstrip our ability to advance the state of the art.

Question: Are you satisfied with the quality of the U.S. civil engineering education? H o w would you propose to better organize the cooperation between the construction industry and universities? H o w can the practical point of view of a field engineer be combined with the scientific (rather than engineering) culture of some of our top academic establishments?

Mr. Stephan: I am satisfied with U.S. civil engineering education. I would strongly encourage a rigorous program in the engineering sciences, for these are best learned in an academic environment. At some institutions, the construction engineering major, within the CE school, has tended to emphasize some business operational skills at the expense of engineering science course work. This is a mistake. Business skills are best learned on the job. If we can provide the opportunity for a return on the investment, the construction industry will seek cooperation with universities far beyond any "pro bono" organized efforts. There is not an inherent barrier between the field engineer and the scientific culture. Our experience is just the opposite. Because of the opportunities afforded us by the design/build project delivery system, we have learned that knowledge is the key to our success. We are always seeking a "better way." The researcher desires to see the fruits of his efforts develop into tangible results and application. The synergy that is created by the blending of practical experience and unconstrained scientific inquiry creates the mental stimulation and resulting solutions when problems or opportunities are mutually explored. We have both enjoyed and benefited from our contacts with the "scientific culture." The potential conflict that can impair cooperation between industry and university arises from university research topics and timing being determined by graduate studies programs and industry's desire for timely research addressing specific needs.

Question: Finally, Mr. Stephan, would you be so kind as to give us, based on your past experience, examples of a successful and an unsuccessful attempt to transfer an innovation to practice. Please concentrate on the economic aspects of the implementation process.

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Mr. Stephan: Our company has successfully transferred numerous means and methods innovations into practice. Our design/build practice has allowed us to design efficient construction practices and methods into our projects and to financially benefit from our successful innovations. The next step of incorporation of scientific innovation offers even greater rewards. In this regard we have not experienced a conclusive end point yet. We have discovered that the path to application of scientific innovation is both expensive and ill defined. I have been involved in trying to transfer the quantum improvements possible in reinforcing steel bond development to practice. It appears we will be successful. We were able to get substantial industry investment and involvement in the research conducted at Kansas. We are getting favorable g o v e r n m e n t response for demonstration projects. The last hurdle is incorporation into the code. Because reinforcing steel is a commodity, manufacturers will not retool and run the new bar patterns unless the design codes recognize the improvement so that a market for the improved product can be created. Facility owners will ultimately benefit from the economies resulting from the efficient use of reinforcing steel. I have also been involved in efforts to use precast concrete in areas of high seismicity. My company's involvement is an outgrowth of the NSF-sponsored PRESSS project between the U.S. and Japan. A good deal of the work involves innovation in joinery. The issues are complex and not widely understood by practicing engineers. In addition, consensus has not been reached among researchers regarding the desirable magnitude of energy absorption by structures. The lack of clear and efficient evaluation procedures and investment in the "status quo" is making the path through the code and standards maze increasingly expensive and uncertain. The economic advantages offered by the new technology are clearly established. The cost of the lack of definitive evaluation processes and a performance-based code which would allow accommodation of the scientific principles has already caused one company to abandon its efforts to transfer their technology to practice. Hopefully, we will prevail and our design/build delivery system will allow us to achieve a return on our substantial investment. Because the process of bringing a technology to practice is so unclear, we have suspended plans for investment in a number of other scientific innovations we are anxious to explore with research universities. We would be unwise to commit our resources to the necessary research until the uncertainties of getting the research results evaluated and accepted are substantially reduced. Our experience is teaching us that, in the U.S., we must develop new procedures for evaluating new technologies.