IT S TIME TO THE STATUS QUO
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1 Steven Fry MBA CHE IT S TIME TO THE STATUS QUO
2 Breaking Down Knowledge Barriers: Redefining and Linking FF&E Redevelopment Strategic Sourcing Steven Fry, MBA, CHE Director, Redevelopment and Capital Equipment Shared Services West
3 Components to Redevelopment Pre-Capital Planning Tender / Build FF&E Management Operational Readiness
4 Agenda 1. Current State of Hospital Redevelopment FF&E 2. Current Problems Exercise 3. Proposed Solutions 4. Country Comparison 5. A Better Strategy
5 Current State of Hospital Redevelopment Current State Problems Exercise Proposed Solutions Country Comparison A Better Strategy
6 1. StatsCan Klein Sullivan OECD CIHI 2009 Did You Know? Aging Population 25% of population will be 65+ in 2036 (9.3% increase) 1 Capital Expenditures 7.3% increase in capital expenditure from Hospital Beds 1.7 acute beds per 1,000 residents, ½ the OECD average 3 Provincial Budgets $1 ~45% of budgets and growing 4,5
7 6. Canadian PPP Project Database 2016 Did You Know? 9 In RFP Process 7 ON, 1 BC, 1 NWT 6 18 Under Construction 11 ON, 2 BC, 3 QC, 2 SK 6 63 Operational 42 ON, 11 BC, 6 QC, 2 NB, 1 NS, 1 AB 6 + Traditional AFP
8 Furniture, Fixtures & Equipment (FF&E) Management Buy FF&E Specification Development Developing Procurement Strategies Manage Bid Administration Negotiate Long Term Deal Shop Drawings Receiving / Acceptance Post Warranty Service Agreements Ongoing Purchases
9 Did You Know? Suppliers Spend 11% (20) 20% (35) % (80M) 69% (125) 15% (15M) 5% (5M)
10
11 How Do We Do It? Ministry of Health and Government Services Ministry of Infrastructure Shared Services Organizations Private Sector Construction Consortiums
12 Current Problems Exercise Current State Problems Exercise Proposed Solutions Country Comparison A Better Strategy
13 Development 1 Scenario Although not your core competency, the ministry has outsourced you to build the hospital structure on the following slide Requirement You must use ALL the blocks Your structure must be 5 blocks high Schedule 30 seconds
14 Development 1 1 block 5 blocks high ½ block STOP! GO!
15 Development 2 Scenario The owner informs you that they have existing agreements in place for GREEN blocks Requirement Remove the GREEN blocks from your structure The structure must be 4 blocks high Schedule 30 seconds
16 Development 2 $ $ $ $ 1 block 4 blocks high ½ block STOP! GO!
17 Development 3 Scenario Your job is complete, pass the structure to the owner in order to finalize the business and commercial agreement(s) Requirement Pass the structure AS IS to the person to the right of you Schedule 15 seconds
18 Development 3 Builder (Project Co) Hospital (Owner/SSO)
19 Development 4 Scenario HURRY, finalize the business and commercial agreement(s) that will govern the structure for 10+ years Requirement Build the structure to mirror the following slide Schedule 15 seconds
20 STOP! GO! Development 4
21 Exercise Learning Outcomes Development 1 Building is not your core competency, supply chain is Development 2 25%-75% of the services are covered by existing agreements, despite having been paid a fixed fee Development 3 Blind hand-offs create broken processes and downstream risk Development 4 There is inadequate time to successfully complete all components of the project
22 Proposed Solutions Current State Problems Exercise Proposed Solutions Country Comparison A Better Strategy
23 Proposed Solutions Schedule Knowledge FF&E Management Solutions Process BPSPD
24 Problem: Schedule Risk Strategic Sourcing within a timely construction schedule Significantly different than day-to-day capital equipment
25 High Level Dashboard Schedule Solution
26 Schedule Solution Overdue Report Bundle Number Bundle Name Procurement Lead SSW Lead Current Late Stage # of Days Late Mitigating Factors TP-19a ASE Dietary Equipment (ASE) John Doe Steven Fry (1) RFx Development 3 w. Hospital. RFx Posting Period will be reduced. TP-19c Non-ASE Food Services Frank Smith Steven Fry (3) RFx Posting 5 w. SSW. Condensed Evaluations meetings pre-scheduled. TP-30a Pumps (ASE) John Doe Steven Fry (4) Evaluations 10 w. Vendor. Contract Negotiations prescheduled ahead of schedule. TP-27 Patient Monitoring (ASE) Nancy Adams Steven Fry (7) Shop Drawings 8 w. P Co. Review by consultants delayed, no impact on construction.
27 Problem: Broken Processes
28 Process Solution Bring shared experience together: 100+ Piggyback Agreements 200+ Existing Specifications 10+ Training Modules Responsibility Matrices Tools & Templates Repository Strong Vendor Relationships
29 7. Howlett, McArthur Howlett Leslie CBC Mar 2016 Problem: BPSPD Compliance Report reveals procurement, hiring problems at [Hospital] 7 Executive who assessed [Hospital] project bids had ties to winner 8 Third hospital embroiled in controversy over executive 9 More untendered spending emerges 10 Hospital president, says he won t step down amid contracts scandal 11
30 BPSPD Compliance Solution Dear Hospital CEO, Compliance with the Broader Public Sector Procurement Directive We provide this letter in compliance of Procurement Directive Compliance: Policy Compliance: Communications from Government authorities: Potential legal Disputes: Yours truly,.
31 Problem: Knowledge Transfer Inexperienced teams make the same mistakes as previous projects Project landscape for FF&E has not evolved
32 Knowledge Transfer Solution Breaking down knowledge barriers
33 Bringing It All Together
34 Country Comparison Current State Problems Exercise Proposed Solutions Country Comparison A Better Strategy
35 USA / UK Model In-Contract ( IC ) FF&E Not-In-Contract FF&E Builder Compliancy Hospital
36 Canadian Model In-Contract ( IC ) FF&E Not-In-Contract FF&E Builder Hospital Agreements Hospital
37 A Better Strategy Forward Current State Problems Exercise Proposed Solutions Country Comparison A Better Strategy
38 The Future of FF&E Redevelopment 2 nd Base: Coordinated Efforts at the LHINs Level 3 rd Base: Government Supported Provincial Strategy 1 st Base: Quarterly Regional Collaboration at Hospital Level Home Run: National Strategy
39 National Hospital Redevelopment FF&E Strategy!
40 THANK YOU! Steven Fry, MBA, CHE Director, Redevelopment and Capital Equipment Shared Services West T: ext. 151 E:
41 Discussion Questions Anyone care to share a redevelopment lesson learned? How are other provinces managing redevelopment FF&E? Does anyone know of alternative models? Any other questions?
42 References 1. Statistics Canada. Estimates of population, by age group and sex for July 1, Canada, provinces and territories, annual (CANSIM Table ). Ottawa: Statistics Canada, Klein, D. et al. (2013). Capital spending in healthcare: a missed opportunity for improvement?. Ottawa, ON: Canadian Foundation for Healthcare Improvement 3. Silversides, A., & Sullivan, T. (2013). Hospital crowding: despite strains, Ontario hospitals aren t lobbying for more beds. Healthydebate. Retrieved from 4. OECD. OECD Health Statistics 2014: How does Canada compare?. Paris: France: OECD, 2014
43 References 5. Canadian Institute for Health Information, Health care in Canada 2009: A decade in review (Ottawa, Ont.: CIHI, 2009). 6. The Canadian Council for Public-Private Partnerships. (2016). Canadian PPP project database. Retrieved from 7. Howlett, K. et al.(2016, February 7 th ). Report reveals procurement, hiring problems at Markham Stouffville hospital. The Globe and Mail 8. McArthur, G. et al. (2015, September 24 th ). Executive who assessed St. Michael s project bids had ties to winner. The Globe and Mail
44 References 9. Howlett, K. et al. (2015, September 29 th ). Third hospital embroiled in controversy over executive. The Globe and Mail 10. Leslie, K. (2009, July 28 th ). More untendered ehealth spending emerges. Toronto Star 11. (2016 March 7 th ). Jack Kitts, Ottawa hospital president, says he won t step down amid contracts scandal. CBC News
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