Benchmarking in Construction Industry

Abstract

The construction industry has followed the lead of manufacturing in adopting total quality management programs. There is currently a lack of benchmarking standards for construction. The Houston Business Roundtable has assembled a group of owners and contractors to solicit ideas and compile initial benchmark data for use by the construction industry. The present paper gives a basic introduction to the process of benchmarking and outlines the steps taken by the Roundtable to date. Data collection has been a learning experience for both participating owners and contractors and the project team due to the lack of benchmarking experience and standardization in the industry. The findings to date indicate that within the construction industry, there is a tendency to overestimate total costs by 8% (on average) and underestimate schedule by 8% (on average), while change orders average +11%. Activities to date represent an important first step toward industry-wide benchmarking standards.