..•.•• •AD-A281 083 •' •

US-m op fEomsA -A 8 8 U.S. Army Corps of Engineer

water Resources Support Center Cw~ucbOBEn~hIUU1

InstiMe for Water Resouress earch Lborgoris

: ~ 1 Challenges and Opportunities for

Innovation in the Public Works

Infrastructure a Volume 11

EL.ECT~

94-20364

Federal Infrastructure Strategy Program

June 1993 IWR Report 93-FIS-3
Federal Infrastructure Strategy Reports

This is the third in a series of interim reports prepared to support the Federal Infrastructure

Strategy Initiative, a 3-year program to explore the development of an integrated multi-agency Federal

infrastructure strategy.

The Federal Infrastructure Strategy is a dynamic program involving many Government

departments and agencies. The series of reports which chronicle the strategy's development reflect the

desire to publish interim documentation as results become available. Theses documents will be used

to facilitate the dialogue within the Federal and non-Federal infrastructure communities as policy

deliberations continue.

The program will culminate with a final report to be published at the end of 1993. The interim

documentation contained herein is not intended to foreclose or preclude the program's final

conclusions and recommendations. Within this context, comments are welcome on any of these

reports.

This report documents the results of an in-depth study and workshop which developed

methods which could be applied to overcome barriers to innovation and the use of innovative

technology within the nation's public works infrastructure.

The first report published as part of the Federal Infrastructure Strategy Program was:

The Federal Infrastructure Strategy Program: Framing the Dialogue - Strategies. Issues

and Opportunities (IWR Report 93-FIS-1).

The next three reports planned for publication as part ,1 the program are:

Challenges and Opportunities for Innovation in the Public Works Infrastructure,

Volume I (IWR Report 93-FIS-2), and

Infrastructure in the 21st Century Economy: A Review of the Issues and Outline of a

Study of the Impacts of Federal Infrastructure Investments (IWR Report 93-FIS-4).

Federal Public Works Infrastructure R&D: A New Perspective (IWR Report

93-FIS-5)

For further information on the Federal Infrastructure Strategy, please contact Robert A.

Pietrowsky, Program Manager at:

Institute for Water Resources

Casey Building

7701 Telegraph Road

Fort Belvoir, VA 22060-5586

Telephone: (703)-355-3073)

The Federal Infrastructure Strategy study team includes Cameron E. Gordon, Economic Studies

Manager and James F. Thompson, Jr., Engineering Studies Manager. The program is overseen by Dr.

Eugene Z. Stakhiv, Chief, Policy and Special Studies Division, and Kyle Schilling, Director of the

Institute. Reports may be ordered by writing (above address) or calling Arlene Nurthen, IWR

Publications, at (703) 355-3042.
DEPARTMENT OF THE ARMY

CORPSe OF GNOGNIN. WATER RESOURCES SUPPORT CENTER

INSTITUTE FOR WATER RESOURCES TM TITELERAPH ROAD

ALIDANRIA, VA 2231•3, 8

Masp June 24, 1994

CEWRC-IWR

MEMORANDUM FOR COMMANDER, Defense Technical Information Center,

Cameron Station, Alexandria, VA 22314

SUBJECT: Transmittal of IWR Report 93-FIS-3

1. Reference AR 70-31.

2. Two copies of IWR Report 93-FIS-3, "Challenges and

Opportunities for Innovation in the Public Works Infrastructure -

Volume II", has hereby been submitted

3. Initial distribution of this report has been made to

appropriate Corps of Engineers agencies. It is recommended that

copies of this report be forwarded to the National Technical

Information Center.

4. Request for the DTIC Form 50 (Incl 2) be completed and

returned to WRSC-IWR.

FOR THE DIRECTOR:

Enclosure Kyle E. Schilling

Director
THE FEDERAL INFRASTRUCTURE STRATEGY PROGRAM

CHALLENGES AND OPPORTUNITIES FOR INNOVATION

IN THE PUBLIC WORKS INFRASTRUCTURE

VOLUME H

Directorate of Civil Works

Office of Interagency and International Activities

Headquarters, U.S. Army Corps of Engineers

Prepared by

Moonja P. Kim

Diego Echeverry

Guruprasad N. Rao

U. S. Army Construction Research Laboratory

P.O. Box 4005

Champaign, Illinois 61820-1305

for

Water Resources Support Center

Institute for Water Resources

Casey Building

Fort Belvoir, VA 22060-5586

DTZC QUALITY INSPECTD) 3

June 1993 IWR Report 93-FSI-3

rg~~~~ 7~~ 41
CONTENTS

Page

INTRODUCTION .................................................. 1

WORKSHOP PRESENTATIONS ........................................ 3

Performance Challenges to Infrastructure Design:

Enhancing the Role oflnnovation in Public Works

Prof. John P. Eberhard ......................................... 5

Searching for the Infrastructure of Tomorrow:

National Research Council Activities, Federal

Interests and Federal Roles

Dr. Andrew. C. Lemer ......................................... 9

How Effective is our Investment in Roads,

Streets, and Highways?

Prof. Thomas D. White ........................................ 23

An Example of Successful Innovation: Three-Dimensional

Graphics on Construction Projects

Mr. Ronald Zabilski ......................................... 33

Issues in Technology Transfer: Sharing Experience

Between Manufacturing and Construction

Prof. Stephen Lu and Prof. Arthur Baskin ........................... 45

Advancing Innovation in Transportation Through Research ................... 77

Prof. Michael Walton

Technological Advances and Public Works:

A Synergistic or Antagonistic Relationship

Prof. Neil Hawkins ........................................... 83

Barriers to Adoption of New Technologies

Prof. Peter Nowak .......................................... 101

Factors Influencing Technology Transfer

to Local Public Works Agencies

Mr. Richard A. Sullivan ....................................... 107

Identifying Programming, Executing Infrastructure

Research and Development

Mr. Carl Magnell............................................. 117

iii
CONTENTS (Continued)

pare

Infrastruture Finance: The State and Local Perspective

Mr. Beidan Mays ........................................ 123

Legal Problems with Innovation in Public Works

Mr. Charles Seemann ....................................... 143

Innovation and Technology Transfer Opportunities:

Industry/University/Government Partnerships

Mr. William D. Michalerys ................................... 153

Technology Transfer as a Work-Practice Change Process

Prof. J.M. De La Garza ............................... o...... 159

Technology Transfer and Public Infrastructure

Development: Financing Capital Improvements

Through the Creation of Knowledge

Mr. Michael B. Goldstein ...................................... 167

implementation of Innovation Through Total

Quality Management

Dr. James A. Broaddus ....................................... 191

Technology Transfer and Marketing: Army-Style

Mr. Jeff Walaszek ........................................... 205

SUMMARY OF WORKING GROUP DISCUSSIONS ........................... 231

APPENDICES: ................................................... 243

Appendix A - Workshop Agenda ..................................... 245

Appendix B - Analysis of Workshop Presentations ........................ 249

Appendix C - Biographical Sketches ................................. 255

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CHALLENGES AND OPPORTUNITIES FOR INNOVATION

IN THE PUBLIC WORKS INFRASTRUCTURE:

VOLUME II - WORKSHOP PROCEEDINGS

INTRODUCTION

This report is Volume II of a two-volume set. Volume I includes a survey of professional

and technical literature on innovation, infrastructure, and technology transfer issues, and

summarizes the contributions of a group of experts to a national workshop on the topic. The

current report, Volume 1I, comprises the proceedings of the workshop.

That workshop, "Challenges and Opportunities for Innovation in the Public Works

Infrastructure," convened a group of nationally recognized experts to discuss barriers to

innovation in the public works infrastructure, share insights, and suggest ways innovation could

be promoted to benefit the condition of the nation's public works infrastructure.

The workshop was sponsored by the U.S. Army Corps of Engineers Federal Infrastructure

Strategy Program. It was hosted by the U.S. Army Construction Engineering Research

Laboratories, in Champaign, Illinois. The program included sessions for presentation of papers

and group discussions to develop recommendations for overcoming barriers and taking advantage

of opportunities to innovate in the public works infrastructure. Participants were strongly

encouraged to make recommendations for enhancing the role of innovation.

The program was organized into three separate topic sections: (1) opportunities for

innovation, (2) barriers to innovation, and (3) enhancing technology transfer. For the group

discussions, participants were divided into three groups corresponding to these topics. At the

end of the workshop, there was a plenary session for reporting on each group discussion. A

chairman and a recorder were assigned to each discussion group and were responsible for

producing the final group discussion summary. Three group discussion agendas were sent to all

participants to be used as a starting point for their discussions.

Contents of this volume include the following: a reproduction of the workshop agenda, the

text of all the workshop papers, reports on the three workshop group discussions (as submitted

by the recorders), summaries of the workshop presentations and group discussions, and

biographical sketches of all workshop participants.

The authors would like to express their deep sense of gratitude to all who participated in

the workshop: Prof. Arthur Baskin, University of Illinois; Dr. James A. Broaddus, Construction

Industry Institute (CII); Mr. Joel Catlin, American Water Works Association; Prof. J.M. De La

Garza, Civil Engineering Dept., Virginia Polytechnic Institute and State University; Prof. John

P. Eberhard, Carnegie-Mellon University; Mr. Michael B. Goldstein, Dow, Lohnes & Albertson;

Dr. Francois Grobler, U.S. Army Construction Engineering Research Laboratories (USACERL);

Prof. Neil Hawkins, University of Illinois; Dr. Andrew. C. Lemer, Building Research Board; Prof.

Stephen Lu, University of Illinois; Mr. Carl Magnell, Civil Engineering Research Foundation

(CERF); Mr. Benjamin Mays, Government Finance Officers Association; Mr. William D.
of Water Resources (IWR); Mr. Jesse Story, Federal Highway Administration; Mr. Richard A. Sullivan,

American Public Works Association (APWA); Mr. Jim Thompson, IWR; Mr. Jeff Walaszek, USACERL;

Prof. Michael Walton, Transportation Research Board (TRB); Prof. Thomas D. White, Purdue University;

Mr. Ronald Zabilski, Stone & Webster Engineering Corporation.

Many people at USACERL helped provide important logistical support for the workshop. Although

it would be difficult to name all who contributed, it is important to acknowledge the efforts of Dr.

Francois Grobler and Mr. Thomas Napier to help prepare, conduct, and report the discussion sessions.
WORKSHOP PRESENTATIONS
PERFORMANCE CHALLENGES TO INFRASTRUCTURE DESIGN

Enhancing the Role of Innovation in Public Works

John P. Eberhard

Head, Department of Architecture

Carnegie Mellon University

To make significant advancement in the urban networks

of movement, information, metabolism, and shelter required by new challenges and opportunities calls for a new

perspective on the nature of infrastructure problems and new

goals for the performance of such systems.

Functional Performance:

Every populated area requires four basic infrastructure

systems:

1. A means of movement for persons and goods between

locations within the area, and a method of connecting

to movement systems outside the area. In most

situations there is a requirement for both horizontal

and vertical movement.

2. A means of communicating between persons and between

organizations, and for providing information for

governance and management. This includes both written

and aural modes, as well as instances of tactile

requirements.

3. A "metabolic" process providing energy for work to

be done, materials for building and repairs, and

methods for disposing of resulting wastes.

4. The "skin and skeleton" of the city which shelter

the functions of individuals and organizations. These

places provide protection from the elements and

enemies; create visual, acoustical and tactile spaces for living and working; and should adapt to changing functions over time.

Over thousands of years the infrastructure of cities

changed slowly. Ways of harnessing animals for transport gradually were supplemented by steam and water-borne modes

of movement within cities. Communications methods moved

from town-criers and messengers to written documents as more

and more people learned to read. The energy of coal, whale

oil, and steam was harnessed to do work. Waste was

transported further and further from city centers for

disposal or dumped into rivers, lakes and streams which

flowed through the city. Buildings became designed and

crafted objects of large size (compared to primitive

shelters) and often of some elegance. However, towards the end of the 19th century the growth of large urban centers (beginning to approach one million

inhabitants), spurred on by the Industrial Revolution, made

this slow evolution unsatisfactory. Especially in the

congested city centers, the prevalence of epidemics, the

5
growing threat from major fires, and the economic pressure

from speculative increases in the price of land, became the

"necessity" for which invention was a dramatic response.

Large numbers of people capable of technological inventions,

protection afforded by a patent system promising nineteen

years of no competition, and the corporate form of business

enabling thousands of persons to make small investments to

capitalize a new venture, all helped stimulate a period of

rapid changes in the infrastructure of cities. The

resulting quantum leaps towards the end of the 19th century

can be termed a "second generation of urban infrastructure".

The second generation was based essentially on eight

innovations introduced before 1900:

1. The steel structural system, separating structure

from the exterior walls, thus making tall buildings

possible.

2. The elevator making vertical movement within

buildings taller than five or six floors practical.

3. Electrical systems, including generators,

distribution methods, motors and the electric light.

4. Central heating which removed the danger of fire

and the logistics problems of fireplaces and stoves;

5. Indoor plumbing, including water supplies, sewers,

bathtubs and toilets.

6. The telephone, including switching centers and

wires for distribution.

7. The automobile (more importantly the internal

combustion engine) easing trips to the suburbs.

8. The subway, making movement patterns in dense urban

areas more effective.

Since the turn of the century, with the possible

exception of radio and television, there has been no major

invention capable of displacing these one hundred year old

systems. All civilian infrastructure investments and

creativity have gone into modest improvements in performance

and/or appearance of these eight innovations, or into the

diffusion and maintenance of existing systems.

It seems clear that major new infrastructure inventions

and innovations are possible. One of the requirements for

advancing new concepts and introducing innovations is to

have a set of performance requirements, e.g., goals and

objectives for infrastructure stated in language which is

independent of existing solutions. A preliminary set of

such performance requirements follows:

Attributes Required of All Systems Independent of Function:

1. Systems should be financed in a way which makes them

economically viable and socially just for all citizens.

2. Systems should be operable whenever needed to

sustain a safe and effective supporting network for the

community, including periods of darkness and/or

inclement weather.

6
3. Systems should be ecologically benign and supportive

of the natural environment in which they are located.

This includes the long term impact on resource

depletion as well short term maintenance of air and

water quality.

4. Systems should be safe to use and equally accessible

to all citizens, including those impaired by age or

disabilities (The American with Disabilities Act

provides for the civil rights of moi:e than 900

categories of disabilities. On July 26, 1990 the ADA

was signed into law by President Bush. This is civil

rights legislation designed to improve access to jobs

and workplaces for people with disabilities. A key

phrase is to provide "full and fair enjoyment" to all

citizens.)

5. Systems should be easily repairable and have

adequate back-up support to be operable at all times.

Performance Criteria Specific to the Four Basic Systems;

1) Methods of movement within an area must: - facilitate movement between all geographic sectors of

the area including three dimensional changes in

topography or building levels; - facilitate movement of loads of any reasonable size

and weight and provide sufficient flexibility to

accommodate additional sizes and weights under special

conditions;

- accomplish such tasks within a time frame responsive

to the functional needs of the community (but always

within safe limits); - be capable of growth and adaptation to both shortterm demands, such as daily commuter patterns, and long

term changes, such as population increases and changes

in functions; and - be responsive to emergencies to facilitate rescue

operations, fire fighting, police calls, and medical

care.

2) Information-management systems of the community must:

- be sufficiently reliable and have adequate redundancy

to assure continuous operation at all times, especially

in emergencies; - enable the management of the operations of all other

infrastructure, including the interactions between each

system;

- provide effective connections to all other

infrastructure;

- be capable of use by large and small assemblies of

citizens, as well as by individuals, regardless of

their language skills; - be capable of expansion to meet growing long-term

demands or rapid short-term surges, and

7
- provide the highest technological level of service to

the largest number of citizens possible, commensurate

with economic conditions.

3) "Metabolic" systems must:

- facilitate the supply and distribution of energy,

goods, food and other resources to support life and

growth in the community;

- provide for the effective removal and disposition of

all wastes created both inside and outside the system; - be flexible and adaptable to short-term changes in

demand; and - make provisions for those times when extraordinary

demands may be placed on the system by the community or

by natural events.

4) The surrounding shells and interior divisions of the

shelter system must:

- facilitate privacy for individuals and groups under

all reasonable circumstances; - protect all citizens from harm and danger, whether

caused by failures in the shelter system, natural

events, or intruders;

- enable all users to find their way within the shelter

enclosure and to identify places (such as parking

spaces) with sufficient clarity to recall their

location;

- provide an esthetic context which responds to

community values and is harmonious with other adjacent

places.

If the standards making bodies of this country would

further develop performance requirements of this type, and

if government programs for funding infrastructure research

and development were to be tied to these requirements, we

might begin to see a third generation of urban systems early

in the next century.
SEARCHING FOR THE INFRASTRUCTURE OF TOMORROW:

NATIONAL RESEARCH COUNCIL ACTIVITIES, FEDERAL INTERESTS AND FEDERAL ROLES

An Issues Paper Prepared for the

Workshop on Challenges and Opportunities for Innovation

In the Public Works Infrastructure

Construction Engineering Research Laboratory

Champaign, Illinois

3-4 March, 1992

Prepared by

Andrew C. Lemer, Ph. D.

Director, Building Research Board

National Research Council

February 12, 1992

9
SEARCHING FOR THE INFRASTRUCTURE OF TOMORROW:

NATIONAL RESEARCH COUNCIL, FEDERAL INTERESTS AND FEDERAL ROLES

by

Andrew C. Lemert

Director, Building Research Board

February 12, 1992

INTRODUCTION

Today, the products of technological innovation in many fields are all around us: Organ transplants have

become almost commonplace in hospitals around the country. A daunting array of new food products with long

shelf lives entice us at supermarkets. Computers that now fit comfortably on one's lap pack more power than

the room-sized machines commonly available just two decades ago.

In contrast, our infrastructure relies for the most part on technologies that emerged initially in the 19th

century. Brooklyn's (New York) was the first modern urban sewerage treatment system, built in 1857 (Herman

and Ausubel, 1988). The first concrete roads followed within two decades the 1824 invention of Portland cement,

and the Place de la Concorde in Paris was paved with asphalt as early as 1835 (Hamilton, 1975). Modern water

supply was born in London in the middle of the century. Alexander Graham Bell invented his telephone in 1876,

and Edison his electric light in 1880.

Some observers argue that technological innovation in infrastructure is lagging, and that government

action is needed to remedy the situation. Others note that with the exception of occasional newsworthy eventsburst water mains, ruptured steam lines, failed cables and switches---most of the U. S. infrastructure continues

to work well, and that other demands for public resources merit higher priority. Does the United States face

particular problems of opportunities lost or higher costs for infrastructure innovation? Is the United States

falling behind other nations in providing infrastructure's services, with consequences for our future quality of life

and international competitiveness? If so, can we agree on an effective course of action? The Building Research

Board (BRB), a unit of the National Academy of Sciences, is working to help answer such questions.

1 The views contained herein are the author's and do not necessarily reflect those of the Building Research

Board or the National Research Council.

II
This paper reviews some of the BRB's current work that sheds light on these and related questions.

We are fiding that there are indeed problems and, while these problems are frequently subtle and resistant to

analysis, there appear to be effective ways to deal with them. However, much remains to be done.

DEFINING INFRASTRUCTURE

Speaking at subcommittee hearings in 1987, during which the results of one NRC study were being

discussed (NRC, 1987), former Sen. Stafford commented that "probably the word infrastructure means different

things to different people."2 One cannot take for granted that people know what "infrastructure" is.

Physical infrastructure is a system of users interacting with a diverse collection of constructed facilities

and associated services, ranging from airports to energy supply to landfills to water treatment. While facilitiesinfrastructures, as some term them----comprise the hard core of the concept, to discuss infrastructure only in

terms of facilities neglects the important services provided by both private enterprise and public agencies, that

are enabled by these facilities. The success of such corporations as Federal Express and DHL in air parcel

delivery, for example, reflects the development of new infrastructure services based on existing infrastructures.

The system of infrastructure is constructed and managed primarily at the level of states and localities,

but has crucial importance for the nation's economy and quality of life. Yet there is no federal center of

responsibility for infrastructure policy, nor are there mechanisms in government at any level for addressing issues

of infrastructure as a whole. Despite more than a decade of debate regarding problems the nation's

infrastructure suffers---underinvestment, inadequate maintenance, lagging technological progress-a variety of

institutional and social barriers block effective action.

SLOW CHANGE OF INFRASTRUCTURE

A study sponsored by the National Academy of Engineering noted that a decisive characteristic of

infrastructure is the generally long physical lifetime of the facilities and the persistence of development and use

patterns that make infrastructures difficult to remove or retire. (Marland and Weinberg, 1988) Infrastructure

facilities are routinely designed to meet demands projected for three decades or more into the future, and despite

some early failures, most dams, bridges, and highways endure for many decades, and sometimes for centuries3 .

Maintenance and occasional refurbishment are required, but the underlying structure often remains little

changed.

Infrastructure facilities are in many instances taken out of service only when a competing device can

perform the service more effectively or because the service is no longer particularly valuable-for example, a

bridge is too narrow for increased traffic loads. However, the design of facilities often reflects the expectations

of the designers, and so U. S. highway pavements have been designed for 20-year lives, while the German

autobahns designed to serve Hitler's 1000-year reich still are serviceable, 50 years later. Power plants have

typically been expected to last 25 to 30 years because history has shown them to become noncompetitive by then,

although that perception is said to be changing---and lifetimes lengthening-as designers reach the ceiling of

thermodynamic efficiency in conventional generation technology.

2 Subcommittee on Water Resources, Transportation, and Infrastructure; Committee on Environment and

Public Works; October 21, 1987.

3 The Takoma Narrows Bridge, famous for its dynamic response to winds, collapsed four months after its

opening. In contrast, the Brooklyn Bridge still serves after 100 years.

12
Because of the large investment embodied in infrastructures, new technologies that might require

replacement or substantial reconstruction of existing facilities must offer much greater benefits than might

otherwise be the case. The evidence shows that there is a relatively long time period, on the order of 100 years

in the case of rail and road, in the transition from one infrastructure technology to the next. The rapid advance

of computers and consumer electronics is due in no small measure to the short service lifetime (e. g., less than

four years for desktop computers) expected of these devices. Shorter-lived or more flexible facilities would

provide an incentive to innovation in infrastructure technologies but this approach raises questions of risk and

reliability, and flies in the face of several centuries of engineering tradition of designing for the long term.

New technologies that can be put into practice through incremental alteration of existing infrastructures

stand a much greater chance of success than those that require major new construction. For example, a quantum

leap in road transport became possible only after introduction of the internal combustion engine. Before that,

even ambitious road construction programs could not significantly improve the slow transport speeds of

horse-drawn carriages and wagons.

The sites occupied by infrastructure facilities may live longer than the facilities themselves. Urb Ad

regional development patterns respond to infrastructure's availability and thereby create demand

continuation of infrastructure's services. Public resistance to location of new facilities enhances the f

continuing operations at existing locations. These effects give substantial impetus to efforts to enla-,ce

productivity of infrastructure technology, relative to its uses of land.

TECHNOLOGY RESEARCH AND INNOVATION

Evidence is strong that declining research efforts and a continuing focus on incremental project-byproject advances underlie a lagging rate of technological innovation, felt throughout the construction sector but

especially serious in applications to physical infrastructure. Accurate statistics are stubbornly elusive, but

estimates by the Building Research Board (BRB) placed aggregate spending on research by the U. S. design and

construction industries at roughly $1.2 billion in 1984, about 0.4 percent of sales in the industry (BRB,1988). In

comparison to other mature industries such as appliances (at 1.4 percent), automobiles (1.7 percent), or textiles

(0.8 percent), this spending rate is low.

In comparison to the construction industry in other countries, the spending is low as well. Estimates

assembled by the Conseil International du Batiment pour la Recherche r'Etude et la Documentation (CIB) place

the rate of building research and development (R&D) spending in the United States at well below half the rate

in Japan, and a role for just over 20 percent of the spending rates in Sweden and Denmark, the nations

seemingly most committed to building research within their national economies (Sebestyen, 1983).

New programs in the United States, such as the U. S. Army Corps of Engineers' Construction

Productivity Advancement Research (CPAR), the several research foundations associated with professional

societies and industry associations, and the Construction Industry Institute have been started since these statistics

were assembled, but there is no indication that the aggregate levels of R&D activity have increased significantly.

According to the National Science Foundation, total annual nondefense R&D expenditures in the United States

have stayed nearly level at about 1.8 percent of gross national product (GNP) since 1981 (Jankowski, 1989). In

West Germany and Japan, the 1988 spending rates were approximately 2.6 percent and 2.9 percent of GNP

respectively, up some 30 to 40 percent over the past decade.

A currently ongoing BRB study on innovation has noted that some of the spending on construction

research--perhaps most of it, in the United States and elsewhere---is devoted to solving problems on particular

projects. Such effort goes unreported in the standard economic statistics and yields benefits initially restricted

to the single project (although more generally applicable improvements in technique typically are used again on

other projects, spread to other firms in the region and eventually to other regions). Also, in contrast to many

13
other nations, there is no U. S. central government department of construction or other agency responsible for

policy in the building industry, so under-reporting of R&D may be marginally more severe in the United States.

Nevertheless, many people have suggested that the U. S. construction industry is lagging, and some go

so far as to argue that U.S. construction and related industries are antiquated and have little real potential for

innovation. It is instructive, however, to recall Charles H. Duell, director of the U. S. Patent Office a century

ago, who advised President McKinley that the agency should be dosed down because "everything that can be

invented already has been."

INSTITUTIONAL FORCES FOR NEGLECT

Several characteristics of U.S. society and government are basically ill-suited to effective infrastructure

development and management. The most frequent result of these characteristics is that we underspend and

underinvest in infrastructure.

U. S. per capita demand for water supplies, the automobile, and disposable materials are extremely high

by global standards, even when corrections are made for relative income levels. These high demands require

high capacity facilities, which then entail more burdensome maintenance and repair requirements. Yet our

political system makes it difficult to assure that funding will be available, so there is a tendency to spend from

capital by allowing facilities to deteriorate more rapidly and then having to refurbish or replace them sooner.

In addition, infrastructures are intrinsically poorly suited to yielding the short term results, particularly

in financial terms, that U. S. business and elected officials favor. Hence, we tend to underinvest. While financial

instruments such as revenue bonds and corporate stocks are available to bridge the gap between long term and

short term interests, they expose the technical concerns of infrastructure to the vagaries of financial markets and

further discourage investment.

A free market system works effectively in principle only when the prices are right for the goods and

services exchanged in that market, and the pricing of infrastructure is notoriously faulty. Infrastructure draws

on natural resources -treatable water, clean air, pristine landscapes---that traditionally have been viewed as

free to all who would capture them, despite early recognition that the herds of a few may overgraze the public

common. Government's role as the primary provider (or at least the regulator) of infrastructure having direct

impact on public welfare has a long-accepted tradition, carrying with it the expectation that general taxes should

offset some or all of the costs. Hence, the direct beneficiaries, users or others, seldom pay the full costs of

infrastructure. In the absence of strong political forces to build infrastructure, this under-pricing also encourages

underinvestment.

Because infrastructure facilities are typically big, geographically extensive, and used by many people,

infrastructure development and operations often have substantial environmental and social impacts. These

impacts have frequently in the past been poorly estimated or neglected in planning and design, and often are

poorly managed within the context of traditional governmental, economic, and institutional relationships. The

rapid expansion of U. S. environmental legislation in recent years has resulted in an "uncoordinated patchwork"

of control requirements that has grown, by one count, from only seven environmental laws enacted in the entire

history of the United States to 1955, to more than 40 by 1986 (Balzhiser, 1989).

These laws, enacted to effect important changes in public priorities, have slowed and sometimes stopped

investments in infrastructure that would have been easily accomplished in prior decades. However, a valuable

consequence is the emerging shift toward environmentally beneficial technologies, more supportive of

"sustainable" economic and social activity.

14
Finally, the substantial public works aspect of infrastructure collides with a distrust of government that

is deeply imbedded in American ideology but especially active in the final decades of the 20th century. Major

infrastructure projects that displace individuals and disrupt communities raise this distrust to a level much

broader than the self-interested resistance of the NIMBY response, further discouraging investment and

innovation.

THE BRB'S STRATEGIC PROGRAM IN INFRASTRUCTURE

Reflecting past and current studies, the BRB concluded, first, that there are indeed obstacles to

innovation inherent in the technology of infrastructure. These obstacles cause innovation to lag behind that being

experienced in other technological fields. Further, these obstacles may be no greater in the United States than

elsewhere, but evidence suggests that U. S. efforts to search for and willingness to invest in new infrastructure

technology lag behind those of other industrialized nations.

To foster broader vision within the nation's leadership regarding the problems of infrastructure and

prospects for enhancing the system's contribution to future wellbeing, the BRB has undertaken a program to

encourage research, changes in government policy, education, and cooperative action by private and public

decision-makers. The BRB program is founded on a premise that the traditional emphasis of research and policy

initiatives-addressed primarily to particular modes of infrastructure-should be linked with broad cross-cutting

initiatives that take an integrative and synoptic view of infrastructure as an organic system. These cross-cutting

initiatives should focus attention on a core of political concerns, institutional structures, and scientific and

technical knowledge common to all infrastructure:

* Complex facilities and multiple users linked through geographically extensive networks

* Common materials such as concrete, steel, and ceramics

* Facilities and services valued not for their own sake, but rather as support for other social and

economic activities

"* Long service lifetimes requiring long-term financial commitments to assure reliable and safe service

"* Diverse and often unforeseen environmental and social impacts that are felt unequally by the various

users and neighbors of infrastructure.

Advances in these cross-cutting core areas will ultimately provide broadly useful lessons for more

effective infrastructure development and management. The pursuit of such cross-cutting concerns--and their

effective integration into national policy-is the central element of the BRB's strategic program in infrastructure.

LOOKING AT LOCAL SOLUTIONS

The initiating activity under this program, approved by Executive Committee of the Governing Board

of the National Research Council in December 1989, has been a series of colloquia designed to address topics

of immediate interest, substantial payoff in terms of motivating improvements in the nation's infrastructure, and

long term relevance. Recognizing that infrastructure problems have national strategic consequences but their

character and solutions are essentially local, the BRB concluded that a major obstacle to effective national action

in infrastructure is bridging the gap between national policy and diverse local and state-level concerns. Studies

to date have largely neglected infrastructure's local users and neighbors, including those who may view particular

infrastructures as a burden out of proportion to their local benefit. This neglect is manifest in the increasingly

widespread NIMBY response to infrastructure projects, now sometimes being supplemented by NOTE (not over

there either) and NIMTOO (not in my term of office)!

15
Yet there have been notable successes in which local communities have been united and mobilized to

come to grips with their infrastructure problems. Identifying the common elements of these successes will give infrastructure planners, administrators, designers, builders, and operators better understanding and guidance in

formulating development and management strategies. This guidance will in turn enhance -at the national

level--the performance and efficiency of our aggregate investments in infrastructure.

Three colloquia are being held to defin, these common elements of success, in Phoenix, Arizona,

Cincinnati, Ohio, and Boston, Massachusetts. These three regions were selected from among a long list of

proposals, based on eight principal criteria:

"* Uses of innovative technology

"* Transferability of technology

"* Demonstrated overcoming of barriers to use of new technology

"* Demonstration of constituency building and community support

"* Demonstration of effective citizen involvement

"* Effective improvement of existing infrastructure (vs. new-build)

"* Demonstration of unique institutional approaches

"* Effective application of life cycle cost/benefit analysis as a management tool, particularly in the

context of political decision-making

Each colloquium will serve as a reconnaissance or "fact finding" workshop involving local professionals

familiar with how infrastructure issues were raised and resolved in their communities. Following the third

colloquium, scheduled for August, 1992, the BRB will prepare a report on the common lessons learned and how

these lessons may be more widely applied.

Partial support for these symposia has been received from the Office of the Assistant Secretary for Civil

Works, Department of the Army, and the Program for Structures and Building Systems, National Science

Foundation. Additional support is being solicited.

NATIONAL INFRASTRUCTURE RESEARCH AGENDA

A second element of the BRB's strategic program will be a study to define the state-of-the-art, basic

research needs and priorities related to the structures, geomechanics, and building systems of infrastructure. This

study is being undertaken by the BRB at the request of the National Science Foundation's Division of Mechanical

and Structural Systems of the Directorate of Engineering, in cooperation with the NRC's Geotechnical Board.

The resulting research agenda will present high-priority opportunities that may be used by the National Science

Foundation and the research community to guide basic infrastructure core research, targeted ultimately to

provide lessons of cross-cutting value for effective infrastructure development and management.

The study will be focused on fundamental underpinnings of physical infrastructure technology, but will

be shaped by the broad national policy debate reflected in such reports as those by the National Council on

Public Works Improvement and others, and work by committees of the NRC and National Academy of

Engineering. The study will also build on other infrastructure research agenda-setting efforts, including work

by the Building Research Board and the Geotechnical Board, and the recent work of other organizations such

as the Civil Engineering Research Foundation's "National Civil Engineering Research Needs Forum" and the

International Society for Arboriculture's "National Research Agenda for Urban Forestry in the 1990s."

16
COST-EFFECTIVE INFRASTRUCTURE PERFORMANCE

In developing their 1988 report, Fragile Foundations, the National Council on Public Works

Improvement found that none of the various measures available gives a clear, comprehensive, and convincing

picture of the status of the nation's infrastructure. In this, the Council echoed the concerns of an earlier body

whose 1984 report, Hard Choices, had questioned at length the widely used concept of measurable "need" for

infrastructure. These studies exemplify a growing awareness among professionals and policy-makers that the

ways performance of infrastructures is characterized and the standards used to judge whether performance is

acceptable have far-reaching but poorly understood consequences for how problems are perceived and what

solutions appear reasonable.

As a part of their efforts to explore future federal government roles in infrastructure development and

management, the Army Corps of Engineers, Institute for Water Resources, has undertaken to identify and

address key issues of infrastructure performance and its cost-effective achievement. Institute staff have asked

the BRB to undertake a study to delineate and address key issues related to the definition, measurement, and

achievement of cost-effective infrastructure performance. Such issues include data needs, problems of

measurement, problems of institutional structure, and others. The study, subject to approval by the Governing

Board of the National Research Council, will focus primarily on infrastructure within urban areas.

OTHER STRATEGIC PROGRAM ACTIVITIES

In addition to these major initiatives, the BRB is working to extend the strategic program. For example,

the BRB's Federal Construction Council and the National Institute of Standards and Technology jointly hosted

a symposium on Addressing Infrastructure Problems on Government Installations. The symposium, held in

February 1992, explored the problems of infrastructure on military bases and other campus-style multi-building

installations, what some refer to as the "mesoscale" of infrastructure. The Federal Construction Council has

requested the BRB to undertake a study of how to assess needs and priorities for infrastructure renewal at this

mesoscale, but budget limitations may delay this study.

Development of joint inter.iational research and development for new infrastructure technology is being

explored with Japanese local governments and private companies. If feasible, the idea might be extended to the

European Community and other areas. For example, a joint international program might be initiated as a multiyear activity of partnering and exchange, undertaken with financial support and professional participation

balanced between the United States and Japan or other nations, with participation of both private and public

sectors in these nations. Some coordinating body might be established (perhaps a Joint Infrastructure Research

and Demonstration Institute-JIRDI) to act ac sponsor or broker for specific research and demonstration

activities. The specific activities could address both new technologies responding to needs in one or more modes,

and major new systems providing substantially different services from those now available. Selection of specific

topics will depend on the program's specific private and public participants, sources of sponsorship and funding,

and other institutional arrangements. A variety of mechanisms might be ccnsidered for setting priorities and

financing the work.

Attention is being given to the relationship of infrastructure to environmentally and socially sustainable

development. "Sustainable development" is, to quote the President of the National Academy of Engineering, "an

imprecisely defined concept that seeks to capture what many regard as the central problem of humanity- how

to sustain the life-supporting environment of the planet while providing for the economic development that will

ensure civilized standards of living for its inhabitants." Development and diffusion of environmentally

advantageous technology is crucial to the solution of this problem, but there is at present no mechanism for

mobilizing the nation's vast technical resources to address these needs.

17
The BRB's work is intended to produce new policy initiatives and functioning programs to address issues

of physical infrastructure. The work andorecommendations that motivate such action are embodied in reports

issued by the National Research Council. The target audience for reports prepared under this program includes

federal agencies and the Congress, state and local governments and their representative institutions such as the

National Governors' Association, the American Public Works Association, and the U.S. Conference of Mayors,

academic and research communities. These reports are prepared and issued according to the NRC's stringent

report review procedures intended to assure balance and objective analysis of the issues at hand. Dissemination

of the information developed in these activities will be supported by public events and media presentations as

well as broad distribution of reports.

DEFINING THE FEDERAL ROLE

While such activities under the BRB's strategic program in infrastructure are addressing a variety of

specific obstacles to innovation, these activities and other BRB studies of technological innovation in the building

industry are making clear the need for some overarching central force for infrastructure innovation. This implies

a possible federal government role. However, defining this role is a complex problem.

In contrast to many other countries, there is no U. S. government agency with explicit responsibility for

representing or encouraging enhancement of either public works or the nation's construction industry as a whole.

The Department of Commerce and the Office of Science and Technology Policy share executive branch concern

for the nation's technology and industrial competitiveness, but seldom address issues of construction and public

facilities.4 There is an effective gap between the interests of the agencies that undertake construction or

manage facilities as accessories to their primary missions---e. g. the Corps of Engineers or the Public Health

Service-and the policy-oriented agencies that may include construction, building products and equipment, or

facilities themselves (i. e., housing or highways) within their broader purview.

Analogies have from time to time been drawn between the U. S. farm and construction industries, both

characterized by many small producers spread across the country, and proposals have been made that there

should be a construction equivalent to the Department of Agriculture or a U. S. government equivalent of other

nations' ministries of construction. In an historic example, the national crisis of the Great Depression of the

1930s (during which the total annual rate of construction in the United States dropped to one third of its average

in the late 1920s) fostered creation of the Public Works Administration (PWA). However, the diversity of

interests among federal construction agencies and the many organizations active in the private sector have been

generally unresponsive or antagonistic to such proposals. Although the PWA survived for some years, its role

as builder was largely relinquished to local government or supplanted by special purpose agencies. (Craig, 1984)

Other centralized building programs of the era, such as the WPA (Works Projects--originally ProgressAdministration) were dismantled as the nation went to war in the 1940s.

Despite such past reluctance, there are sound reasons why the federal government should play a

significant role in the search for infrastructure innovation:

0 Infrastructure innovation will help government agencies to achieve better cost, quality, and

performance in their own facilities.

* Infrastructure innovation will enhance quality of life in the United States.

4A major exception is the focus on the construction industries of Japan and the United States in trade

negotiations of the late 1980s and early 1990s.

18
0 Infrastructure innovation will support growth in U. S. industry's productivity and thereby enhance

competitiveness in international markets.

While no comprehensive evaluation or recommendations have yet been made, the BRB's studies of

innovation suggest several promising components that might be incorporated in the federal role: (1) federal

agencies encouraging applications of new infrastructure technology for their own projects, (2) support for worldwide infrastructure technology intelligence-gathering to increase domestic awareness of international technological

progress, (3) development of standard testing procedures and evaluation criteria that would enhance the

acceptance and effective transfer of new technology to U. S. local communities and the private sector, and (4)

increased support for targeted research efforts to develop new technologies in specific areas, perhaps through

existing and new university- and industry-based "centers of excellence."

A SPECIFIC PROPOSAL

No specific form for the federal role has yet been considered in the BRB work. These four components

might be distributed among agencies or concentrated in one existing or new institutional location. However, the

author's own analyses suggest strongly that the search for new infrastructure technology (and policy) should be

pursued initially with strongly unified and focused effort. The reasons are several:

(1) In any society, there is an inevitable limit on the resources available to deal with any particular issue,

problem, or goal. When these limited resources are spread too thinly, little is likely to be accomplished, and that

has been a problem with infrastructure.

(2) The institutional framework is complex, and with the notable exception of transportation---and

highways especially---there is no historical focal point for infrastructure issues in the United States, although

professional organizations and trade groups (e.g., the American Public Works Association, the American Water

Works Association, the American Society of Civil Engineers, and others) do provide some focus. What is needed

is some institutional and intellectual coordination of effort to address the common, crosscutting opportunities

and problems of infrastructure.

(3) Stronger linkages between the national level and state and local bodies active in development and

application of infrastructure technology are needed. The existing modal and disciplinary professional

organizations are vital channels for forging these linkages, but additional efforts are needed to mobilize and guide

the university-based research and education programs that will be expected to yield new technology and the

personnel trained to apply this new technology to practical problems.

The new focus would provide leadership in the national discussion of infrastructure policy, a point of

contact for international exchange on issues related to global infrastructure and impacts, an effective

clearinghouse for research and development information exchange, and perhaps limited funding for policy-related

research. The Council on Environmental Quality, the Advisory Council on Historic Preservation, or the Office

of Science and Technology Policy might be domestic models for a new agency. The International Institute for

Applied Systems Analysis, in Austria, and the International Rice Research Institute, based in the Philippines but

with projects in other countries, are possibly applicable international examples.

An effective focus might be established within an existing institution. The role of the Surgeon General

of the United States and the 19th-century office of the "Supervising Architect" responsible for federal building

design are models of what might be done within existing agencies. The current joint work of the Army Corps

of Engineers and the Department of Transportation on possible federal support of high-speed magnetic levitation

(maglev) transportation suggests that other forms may also work. However, there is no clearly defined

19
responsibility for this activity within any single currently active federal body, and the specific form should be

crafted to assure the institutional linkages needed for research results to enter practice quickly and effectively.

The greatest proportion of work on infrastructure research and policy concerns issues specific to one

or another of the modes of infrastructure, but perhaps ten to twenty percent of concerns span modes and warrant

this focused interest. A research-funding agency, such as the National Science Foundation, could undertake to

establish one or more "Centers of Excellence" in infrastructure technology and modal agencies such as the

Department of Transportation, the U. S. Army Corps of Engineers, the Environmental Protection Agency, and

others could be directed to channel some portion of their research spending---perhaps one to two percent

initially-into topics of cross-cutting significance, for which university and agency researchers would compete.

The loose confederation of university transportation centers, some of which competed successfully for

funding under the Department of Transportation's Congressionally mandated system of ten designated "centers

of excellence" (grown to fifteen under the new 1991 transportation legislation), is possibly a target model of an

effective system of university-based infrastructure research and training, and might provide the seed organization

from which a broader infrastructure research program could be grown.

Supplementing this government-sponsored, there should be tax credits or other federal incentive to

private sector participation in infrastructure research and development activities. The benefits of this broader

participation would be felt not only within the U. S. infrastructure system, but also in the export potential of new

U. S. infrastructure products and services and in the generally enhanced productivity of a nation better-served

by infrastructure.

The core of this incentive might be preferential tax treatments for private expenditures on infrastructure

research and development, public-private partnerships for new technology demonstration programs, and privately

financed programs of insurance and other mechanisms for sharing the unavoidable risks of new technology.

However, formation of a national infrastructure development bank, modeled perhaps on operations of the World

Bank, would establish a "lender of last resort" for demonstration projects that appear to offer high economic

returns but with institutional challenges that exceed what private financial markets are willing to accept. Capital

for this bank could be raised initially by small commitments from existing federal infrastructure trust fundsperhaps two to five percent of current highway, airport and interstate energy transmission funds--and private

market underwritings. In addition, all state and local jurisdictions hoping to participate in projects funded by

this bank would be required to commit some fraction of their property tax and infrastructure use tax revenues

(e.g., licensing fees and sewer rates)-again, perhaps two to five percent---to the institution's capitalization.

CONCLUSION

As with any technological field, innovation in infrastructure faces many challenges but offers

opportunities as well. The challenges in infrastructure may, for many reasons, be greater than in other fields,

and the finding ways to encourage innovation has been especially difficult. The BRB is working to build

understanding of whether actions can and should be taken to meet these challenges and, in particular, what role

national policy and the federal government can play in this very locally oriented field.

Baseball star Yogi Berra is said to have opined "No matter where you go, there you are." In discussions

of infrastructure innovation, we are still at the stage of determining where we are, and where we want to go. The

BRB is working to help us find the way.

20
REFERENCES

Balzhiser, R. E. 1989. Meeting the Near-Term Challenge for Power Plants. In Technology and

Environment, J. H. Ausubel and H. E. Sladovich, eds. Washington, D.C.: National Academy

Press.

BRB (Building Research Board). 1988. Building For Tomorrow- Global Enterprise and the U.S. Construction

Industry. Washington, D.C. National Academy Press.

Craig, L. 1984. The Federal Presence: Architecture, Politics, and National Design. Cambridge, MA: The MIT

Press.

Herman, R. and J. H. Ausubel. 1988. Cities and Infrastructure: Synthesis and Perspectives. In J. H.

Ausubel and R. Herman, eds. Cities and their Vital Systems. Washington, D.C.: National

Academy Press.

Jankowski, J.E. Jr. 1989. National Patterns of R&D Resources: 1990. Report number NSF 90-316, National

Science Foundation, Washington, D. C.

Marland, G. and A. Weinberg. 1988. Longevity of Infrastructure. In Cities and their Vital Systems, J.

Ausubel and R. Herman, eds. Washington, D.C.: National Academy Press.

Sebestyen, Gy. 1983. Measurement, Accounting, and Taxation for Research and Development: Volume

and Support of Construction R&D. Study submitted to the board, Conseil International du

Batiment pour la Recherche l'Etude et la Documentation (CIB), Rotterdam.

National Research Council, Committee on Infrastructure Innovation. 1987. Infrastructure for the 21st Century.

Washington, D.C. National Academy Press.

21
HOW EFFECTIVE IS OUR INVESTMENT IN ROADS, STREETS AND

HIGHWAYS?

T.D. White, Associate Professor

School of Civil Engineering

Purdue University

Introduction

States are making a significant annual investment maintaining, rehabilitating, and

constructing or reconstructing the highway and bridge infrastructure. However, there is still

concern about the overall level of serviceability and condition of these facilities. Similarly,

large cities have deteriorating roadway/street networks. These cities are population centers

and public service demands are taking a larger portion of available financial resources and

as a result reducing the resources available for the roadway/street network as well as other

important infrastructure components. Small cities and towns have generally not had the tax

base and do not now have taxpayer support to increase taxes to fund major construction or

rehabilitation. In many cases they do not have resources for effective pavement maintenance

programs.

Real improvement in the serviceability and condition of the highway transportation

infrastructure will require an innovative and long term perspective. A large part of the

problem lies with legislation, agency philosophy, and industry. In turn a large part of the

solution will come from these same parties.

Transportation Significance

By any measure, the impact that transportation has on the Nation's economy is

significant. Table I gives the relative percent that can be attributed to transportation for

several components of the nation's economy. This includes gross national product, federal

taxes, capital outlay and civilian employment.

The estimated freight bill for transportation of products produced by the economy

are shown in Table 2. The highway component of freight transportation, obviously is the

most significant of those listed. The total government expenditures at the federal, state and

local levels for transportation facilities are given in Table 3. The highway share of these

expenditures is the largest.

A measure of the innovation that might be applied to the transportation system

would be the U.S government R&D outlays for transportation that are shown in Table 4.

The interesting statistic from this table is that the outlay for highways is about 14 percent

of the total federal R&D outlay as compared to 66 percent for air transportation. Another

interesting fact from this table is that the federal R&D outlay for transportation as

compared to total government R&D outlay is 3.3 percent. The outlay for

23
highways based on this total government R&D would be about 4 tenths of one percent.

Enabling System for Transportation Infrastructure

As shown in Figure 1, an attempt has been made to consider the institutions that

make up the system for legislating, overseeing, designing, building, advising, advocating and

researching aspects of the infrastructure in general and the transportation infrastructure

specifically.

Figure 1 shows these various interests as legislatures, industry, academia and agency.

Of course, the philosophies, concepts, and actions of these interests all impinge upon society

(John and Jane Q. Public). In fact, the health of society, as supported by the strength of the

economy, is guided and determined by the action of the other components. These

components of the system impact the transportation infrastructure in a number of ways.

Legislators

Legislation or rules that affect transportation infrastructure occur at various levels

of government. However, the primary legislation is enacted at the federal and state level.

Local policies and rules are generally adopted under the guidelines set at the state and

federal level.

Because of the impact that transportation has on society and the amount of resources

necessary to built and maintain transportation systems, the transportation departments of

government become a focus of politics and legislation. The complexity and technical aspects

of transportation departments should dictate that a high degree of technical ability and

professionalism would be employed in the leadership of transportation departments. In

some states, this is the situation, however, in a number of states it is not. In those states

that this is not the situation the leadership is provided by political appointees, often times

with little experience and leadership for such a position. In one midwestern state, with a

change of administration, the job description for district engineers was rewritten as a district

managers position. This creates the possibility the position could be filled by an appointee

without an engineering background. The situation that this creates is that the engineering

activities of the transportation department in that district would not be directed and

managed by a professionally trained engineer. If this should happen the responsibility and

the liability of engineering activities undertaken within districts then would be passed to the

central office and the chief engineer. Supervising these dispersed engineering activities from

the central office would be a significant responsibility for the chief engineer.

24
Politics also play a role in the organizational structure of transportation departments,

restructuring for efficiency is desirable and may actually be one of the options for dealing

with a structured civil service system. Unfortunately, in todays tight financial resource

situation restructuring is associated with making do with less money. Salaries in

transportation departments are traditionally low, although there may be a few exceptions.

In many cases the low salaries are making it difficult to replace professional staff in a timely

manner. State administrators and legislators are reluctant to raise salaries because it is

considered poor politics. The lack of professionally trained leadership and administration

of transportation departments is ultimately a loss to society.

There is an opportunity for comprehensive long-term legislation to impact the

transportation infrastructure. Perhaps an omnibus legislation at the federal level could

provide a framework for an integrated transportation system and guidelines for growth of

that transportation system. It is time for new comprehensive transportation development

that would include integration of air, automobile, rail, truck and bus modes of travel and

movement of goods. In a recent newspaper article Boeing Aircraft Corporation was quoted

as having estimated that air traffic will triple by the year 2020. There are a number of

factors, particularly the national and international economy, that will affect the actual rate

of growth. Whether air travel triples or not, it will grow significantly within that time frame.

It is easy to suggest that the number of airports will not triple within that period of time.

Only a modest increase in physical facilities is likely to occur. That means that there is

going to have to be a significant latent elasticity for handling increased demand with current

airport facilities.

A large portion of the major airports in the United States are concentrated in urban

areas. The increase in air traffic and an associated increase in passengers will impact on

ground transportation. Attention paid to developing an integrated transportation system

would pay benefits by establishing a structure for ground transportation that would not only

be more efficient for handling an increase in the number of air passengers but would benefit

the other modes of transportation. It is recommended that the existing transportation

system be integrated as soon as possible.

There should be an extended time horizon with which legislation and policy is

established. This may be difficult when many legislators view their position on a time

horizon of two to four years which is based on the political expediency of being reelected.

A distant time horizon for many institutions in U.S society would be beneficial. It is

particularly true of the transportation infrastructure. A significant reason for adoption of

the legislation establishing the current interstate highway system was predicated on the need

for a direct high speed road network for national defence. The interstate system as a means

of public transportation was also stated and the benefits to the public were considered.

However, once established and construction undertaken, the national defense aspect became

less important. During the 1970s and 80s as the initial construction began wearing out, the

cost of maintaining and rehabilitating the highway system became a prime issue at the state

and federal level. The twenty to thirty year time frame for planning and design of the initial

interstate system obviously was not adequate. It would have been more appropriate to have

adopted a time horizon of a 100 years or more. That a national policy for such an

25
important aspect of a nations infrastructure could be established for 100 year has an

interesting example in the current development of a national high speed rail network in

France.

Plans already implemented in France call for the development of high speed rail

(TGV) segments to serve four quadrants of the nation. These segments will hub at Paris

where a central facility has been built. The right-of-way leading into Paris for the high

speed rail will follow a right-of-way that was set aside for rail purposes in 1900. That rightof-way is being developed as a multi use corridor that will blend the rail service with a green

belt that will provide recreational opportunity and blend well with the neighborhoods

through which the right-of-way passes.

There is an opportunity for legislators and political leaders to establish long term

policies that would insure timely and logical development of the nations transportation

infrastructure and foster innovation. This would require non-partisanship and vision on the

part of our leadership. It appears that the public sees a need for leadership and is becoming

increasingly sensitized to such issues. The presidential primary of 1992 has been a very

enlightening experience in this respect. For example, the news media in a surprised way

reported in the South Dakota primary that the voters of that state were exhibiting a deepseated anger at the business as usual attitude and lack of leadership from legislators and

administration.

On the political landscape, legislators are having to face the fact that society is going

through a period of activism. The activism comes from individuals, groups and businesses

and their associations. This activism has significant impact on transportation infrastructure

development. For example, in San Diego, California a light rail mass transportation system

is being developed. The development of that rail system is being focused upon by

individuals and groups that are divided by the definitive positions of yes and no. It is difficult

to work at developing this transportation facility on a timely and cost effective basis in this

type of an environment. However, in spite of this focus of attention, the development of the

light rail system is proceeding.

Industry

A large part of our economy produces, transports or sells goods. There is also a part

of the economy that provides services. The transportation system that supports these

business as well as personal travel demands is itself supported by a large component of

industry that includes contractors, consultants, material suppliers, equipment suppliers, and

industry associations and research centers. Users such as the driving public, truckers, and

airlines can also be considered to have an impact on the transportation system. These

parties are considered in this paper as the transportation industry. This industry affects the

transportation system through demand, support for legislation, and materials and equipment

for construction and maintenance.

The transportation system and society would be better served by balancing demand.

Trucking interests lobby for bigger vehicles. However, bigger vehicles are not necessarily

26
compatible with small vehicles or with the transportation infrastructure. Construction

material interests compete for market share and there needs to be an equable process of

comparing material choices and pavement types. Standard materials and pavement types

would be better applied and innovative materials and processes could be better evaluated.

There are a number of opportunities to enhance the effectiveness of resources that

are expended on the transportation infrastructure. Professional engineering experience and

knowledge could be expanded by certification in specialties. Certification would create a

demand for continuing education to prepare engineers for certification and to maintain that

certification. Another enhancement would be a means of evaluating new technology that

would reduce the time for approval and adoption by industry. Accelerated pavement testing

that is being pursued by several agencies is an example of how materials, pavement features

and loading can be evaluated. Figure 2 shows a schematic of an accelerated pavement

testing system being put into service by the Indiana Department of Transportation and

Purdue University in West Lafayette, In.

Traditionally design and construction research in civil engineering has been done in

the public sector. The transportation infrastructure would benefit from industry taking a

more active role in funding research in-house, at universities or in research centers. The

National Asphalt Pavement Association and National Stone Association have recently

established research centers in their respective areas of interest.

Agency

Transportation agencies establish the scope, design criteria, material specifications,

construction methods and quality control/acceptance method for transportation

infrastructure projects. In some agencies this system is historical and well entrenched and

provides barriers to innovation. A new perspective of this system would create opportunities

to apply innovation to the transportation infrastructure. The concept of a warranty for

construction is used in Europe but not in the US. Additional benefit might be gained by

combining warranties with the concept of design/build. This combination would encourage

innovation from the design/build team. There is also the potential for private industry to

own and maintain transportation infrastructure facilities.

Agencies can benefit from innovation and are faced with implementing a number of

new technologies. Productivity incentives have been evaluated in Oregon for Department

of Transportation maintenance workers. Productivity is measured by amount and quality.

Agencies are on the threshold of an information explosion. This is coming about because

of development of hardware, software and the means of collecting data.

Research can be a source of innovation for agencies. The Strategic Highway Research

Program is producing a number of innovative products and agencies are developing plans

for their evaluation. However, there are constraints on research that inhibit innovation. The

constraints come from the fact that major research funding organizations solicit research

based on defining the tasks, products, schedule and funds. The National Cooperative

Highway Research Program is an example of this approach to funding research.

27
Universities

Universities face challenges in hiring faculty, incorporating infrastructure technology

in course work, and teaching and research resources. Infrastructure technology is evolving

rapidly. There is a shortfall of knowledgeable, experienced faculty and a number of

universities are having difficulty filling vacant positions. Another trend that may impact the

nations infrastructure is that a number of major universities have deemphasized Civil

Engineering which is the major discipline for infrastructure engineering staff.

The shortfall of financial support to maintain and equip laboratories for teaching and

research is growing. Many university laboratories are not equipped to demonstrate current

test procedures. As innovative materials and tests are adopted this limited capability will not

be adequate. As an example, the Strategic Highway Research Program is proposing asphalt

and asphalt mixture tests that will require equipment that has been estimated will cost

$320,000. If these tests are adopted only three or four universities in the country are likely

to be able to purchase the equipment. Research will be further inhibited.

Summary

Transportation and its infrastructure represents a significant portion of the nations

economy. Continued health of the transportation infrastructure will benefit from long range

planning to include a time horizon of 100 years or more and integration of transportation

modes. Innovation is needed and is possible both from industry as well as transportation

agencies. Universities need support if key infrastructure technology is to be effectively taught

and meaningful research conducted.

References

American Society of Civil Engineers Policies and Priorities, Washington, D.C., January 1992.

Germane, G.E., Transportation Policy Issues for the 1980's, Addison-Wesley, Reading, MA,

1983.

Small, K.A., Winston, C. and Evans, C.A., Roadwork. A New Highway Pricing and

Investment Policy, The Bookings Institution, Washington, D.C., 1989.

28
Table 1. Impact of Transportation on Economy -

1981 (Germane 1983).

Gross National Product About 21%

Federal Taxes About 15%

Capital Outlay Over 15%

Civilian Employment About 10%

Table 2. The Nation's Estimated Freight Bill (Germane 1983).

1980

Total in Millions $204,698

Percent of GNP 7.79%

Carrier

Shares

Air 1.6%

Highway 72.7%

Oil Pipelines 3.3%

Rail 13.6%

Water 7.2%

Other 0.4%

(Forwarder & REA Exp.)

Shipper 1.2%

Internal Costs

100.0%

29
Table 3. Federal, State & Local - for Transportation

Facilities (millions of dollars) (Germane 1983).

1978 Shares

Airways & Airports 4,106 11.2%

Highways 30,831 84.4%

Railroads* ......

Rivers & Harbors 1,588 4.4%

Total 36,525 100.0%

* Does not include government guaranteed loans or AMTRAK,

or urban and high speed ground transport federal

expenditures.

Table 4. U.S. Government Transportation R&D Outlays (% of

total federal R&D) (Germane 1983).

1980

General 2.6%

Air 66.2%

Highway 13.6%

Railroad 5.2%

Urban Mass Transit 6.9%

Water 5.5%

Total Transportation 100.0%

Total Transportation R&D $ 1,020

(millions of $)

Total U.S. Gov't Outlays for $30,477

R&D (millions of $)

Transportation R&D as a %

of Total

U.S. Government R&D 3.3%

30
AGENCY "INDUSTRY

SOCIETY

(John and Jane 0. Public)

ACADEMIA

Figure 1. How Does the System Work.

31
C

0 >

Ep -

El

LII> 6-

322
CHALLENGES AND OPPORTUNITIES FOR INNOVATION

IN THE PUBLIC WORKS INFRASTRUCTURE WORKSHOP

UNITED STATES ARMY CORP

OF ENGINEERS

CONSTRUCTION ENGINEERING RESEARCH LABORATORY

AN EXAMPLE OF SUCCESSFUL INNOVATION:

THREE-DIMENSIONAL GRAPHICS ON CONSTRUCTION PROJECTS

Ronald J. Zabilskil

ABSSACT

Stone & Webster Engineering Corporation is using a Computer Aided

Construction System that integrates construction planning with

estimate development, schedule generation, and project management

tools. Integration is achieved by linking IBM's DB2 relational

database with the CATIA three-dimensional (3-D) solids modeling

applicaLion. The relational database is the central repository for

all plant information and documents of a project over the life

cycle of the entire facility. The 3-D model is the plant design

and the window to the database information.

Construction planning is conducted with the 3-D construction

sequence model. The model provides the construction engineer with

a tool that helps clarify the scope of the project. The design model is disassembled into its base components, pipe spools,

concrete pours, and equipment. A project team then assembles the

model, simulating the sequence of field construction activities.

The sequence model can be played back for verification of the logic

and can be easily modified to account for problems, such as

material and equipment access, delays in equipment delivery, and

craft loading. Quantities are developed from the physical

characteristics of the 3-D model. Labor-hours are generated by

multiplying historical installation rates by the modeled

quantities. Material and labor costs are then extended. The

graphics sequence model is then used to generate the project

network schedule. Construction progress is reported by selecting

modeled components that have been completed in the field; laborhours are loaded from the project's accounting system. The system

then updates the schedule and reports using performance measuring

techniques.

'Manger Advanced Construction Systems, Stone & Webster

Engineering Corp., P.O. Box 2325, Boston, MA 02107

33
INTRODUCTIO

Stone & Webster Engineering Corporation has implemented a project

development and management system that integrates all plant information into a single Integrated Plant Database. Information

is developed in three-dimensional (3-D) graphic format for plant

layout and as text data that describe and document the project.

The graphical and textual information is linked together in the

database by unique identifiers, which permits the development of

applications for design and construction of new plants, backf it and

life extension of existing facilities, and operation and

maintenance of operating plants.

The IPD was developed using commercially available IBM products,

including DB2, a relational database, and CATIA, a 3-D solids

modeling application. Stone & Webster created interfaces that

allow these programs to communicate. The IPD operates in a

mainframe environment.

CONSTRUCTION

With the advent of 3-D computer modeling, construction personnel

have become more interested in the capabilities of computer

graphics. The 3-D computer solids model has enabled the

construction engineer to benefit from information that was

previously unavailable ti him. He can view a design from any

desired view. He can choose the information and the format in

which the information is to be displayed. With prior systems,

information was displayed in a form that was chosen by the

designer.

Leveraging the capabilities of the CATIA 3-D modeling application

and the benefits of the DB2 relational database, Stone & Webster

has developed an advanced construction management system. The

COnstruction XMAagement Display Bystem (COMANDS) enables automated

quantity development of project estimates linked to the modeled

quantities, automated development of construction schedules based

on the construction sequence model, identification of bulk

materials for procurement, and construction progress reporting by

pointing to completed elements in the model.

CATIA supports true full-scale 3-D solids modeling, which means

that each element in the model has full-sized physical dimensions

and properties. The software can automatically calculate length,

area, and volume. If element densities are provided, weight and

center of gravity are also calculated. When element descriptors

are added to each component, quantities, such as cubic yards of

concrete, tons of structural steel, and square feet of painted

surface area, can be generated automatically from the model. This

information is stored in the database and is used to create an

estimate of the material and equipment that will be needed during

construction. Total craft labor-hours and costs are also

34
calculated in the database by multiplying material quantities by

historical craft installation labor rates and craft hourly wage

rates.

Stone & Webster uses COMANDS in two modes: on Stone & Webster

designed projects and projects designed by other engineering

companies.

In the first mode, projects are designed and engineered in CATIA 3-

D graphics. The project database is developed simultaneously.

Drawings are generated by projecting a solid geometry image into a

2-D window. Notes and dimensions are then added. Construction

personnel then use this information to develop the COMANDS

database.

In the second mode, the project is designed by others. Threedimensional models and the database are then developed from the

design drawings. The drawings are loaded into CATIA by

construction, estimating, and scheduling engineers. Experience has

shown that information can be modeled from 2-D drawings very

rapidly. The boiler building of a 150 MW pulverized coal power

plant was modeled in three weeks by two engineers. The model

included the structural steel columns and beams, the boiler, all

major equipment, piping, HVAC duct, cable tray, and platforms. The

modeling effort simulates construction in the field and

familiarizes the participants with the project's scope of work.

Since all components have to fit together in the 3-D model, the

design is verified prior to start of actual construction

activities, with constructibility analysis, value engineering, and

interference identification being conducted concurrently.

Since COMANDS is used as a construction tool, the level of detail

that is required in the 3-D model need only be at the level that

project management chooses to monitor the construction activities.

Modeling to the nuts and bolts level would be extremely time

consuming, whereas a building block model would not provide

sufficient detail to be useful. Stone & Webster models to the

level of detail that is identified in the project's work breakdown

structure (WBS). The WBS account/activity list identifies this

level of detail. An activity can be tracked at a system level; for

example, "Install Feedwater Piping and Testing." It can also be

tracked at a component level where each account is identified in

the installation process; for example, 10 inch carbon steel pipe,

pipe supports, welding, valves, painting, insulation, testing, and

turnover. As a rule all civil and structural activities are

modeled to the level of detail in the design. This includes

excavation, backfill, foundations, slabs, walls, and structural

steel. Mechanical equipment has been modeled as it physically

exists and as volumetric blockouts. Pipe has been modeled with and

without valves and fittings. Electrical equipment is modeled as

equipment blockouts, and cable tray is routed dimensionally

35
correct. Conduit is not usually modeled since it is normally run

to suit existing field conditions.

A compromise needs to be made between the initial cost of the

detailed 3-D model and the downstream savings of having this

information available for estimating, purchasing, and project control. This does not preclude specific areas of the design being modeled in a high level of detail for study purposes.

APPLICATIONS

Duct Removal Project

After the model has been developed, planning is the first step in

the use of COMANDS. Planning starts with the development of a

construction sequence model. The model is disassembled into its

base components. Concrete slabs and walls are split at the

construction joints, piping by spool section. The model is then

assembled by a project team, simulating the sequence of

construction activities as they would be conducted in the field.

The sequence model can be played back for verification of the logic and can be changed easily to account for problems such as material

and equipment access, confined work spaces, and craft personnel- loading. An example of this is demonstrated by the demolition of

an exhaust duct section which was part of a precipitator backfit at

an operating plant (Figure 1). The precipitator was designed to be

installed in the location of an existing duct section. The project

was designed in 2-D. The design was manually loaded into CATIA in

three weeks. The model consisted of the exhaust duct section,

chimney and breaching, precipitator foundations, structural support steel, and hydraulic jacks. The installation duration spanned 18

months and included two planned outages, one at the start and one

at the end of the project.

During the initial two-day outage, a pipe sleeve was installed

through the existing exhaust duct. After the sleeve was installed, the exhaust duct was put back into service. This enabled the

installation of the foundations, structural steel, and precipitator without impacting the plant operations. The second outage took

place at the end of the schedule when the duct section was cut out

of the exhaust duct. The 105 ton duct section was lowered to the

ground with four 27.5 ton hydraulic jacks. Once on the ground, the

duct was cut up and removed. Also, the precipitator tie-in was

performed simultaneously.

The modeling effort identified three construction problems that

were not readily apparent from the 2-D design. The first problem

was identified after the assembly of the model and interferences

were investigated. A second interior structural steel column was

occupying the same space as a portion of the duct and stiffeners.

A second concern was raised during the sequence study of lowering

36
Figure 1. Exhaust Duct Demolition Sequence Planning

37
the duct section. The design of the foundations caused the duct to

hang up on the concrete prior to contact with grade. The last

restraint was identified when the remaining structural steel was

installed between grade and top of the structure. The bottom of

this steel interfered with the top of the duct. This would require

that the duct section be removed prior to installation of this

steel, thereby increasing the duration of the schedule.

The first problem with the structural column was solved by cutting

out the portion of the duct stiffeners that was interfering. The

second and third problems was solved by modifying the foundation

design, eliminating the hang up and enabling the top of the duct to

be 18 inches lower than the bottom of steel when lowered to grade.

The 3-D construction model identified these deficiencies early

enough in the project to permit effective constructibility analysis

and value engineering. If the problems of the duct hanging up on

the foundation and the structural steel interference were not

identified until the outage commenced, the impact on the schedule

could have been severe.

Power Plant Environmental Systems Retrofit

Stone & Webster's 3-D modeling system has also been used on a 550

Megawatt pulverized coal fossil power plant. The project consisted

of retrofitting the existing scrubber units, removing precipitator

units, and replacing 800 tons of exhaust duct during a twelve week

outage.

During the proposal, 3-D computer models were developed of the

existing plant configuration and the owner's conceptual new duct

design. The models were developed from the existing plant drawings

and a preliminary walkdown of the plant. The models were completed

by two construction personnel in three weeks and included all

facilities and equipment associated with the plant's flue gas

desulfurization area (Figure 2).

The models initially were used to help Stone & Webster personnel

understand the scope of the outage work and facility layout for the

project. They were also used to quickly determine quantities of

duct work, structural materials that were to be restored, removed,

or installed, and the surface area of the structural steel for

sandblasting and painting. However, the main use of the models was

to develop a construction sequence to visually verify that the

project could be completed on schedule. This approach was used to

convince Stone & Webster's management, as well as the owner, that

the tight schedule could be met with minimal risks.

After the contract award, Stone & Webster conducted the detail

design of the plant building upon the model developed in the

proposal. Three-dimensional modeling was used for all new

38
EXISTING DUCTWORK DESIGN

NEW DUCTWORK DESIGN

Figure 2. Existing and New Environmental Systems

Configurations

39
mechanical and structural design. This included footings and

foundations, structural steel, mechanical equipment, duct work,

pipe, and pipe components. Design drawings were made from the 3-D

geometry using the system's 2-D capabilities.

Using 3-D design, the design engineer translates the 3-D image in

his mind to create that same image on the screen of the workstation. Structures and systems are continuous and complete. They

are not regulated or designed on separate sheets. Structural bays

are developed; general arrangements of equipment are fitted into

the bays; and pipe, HVAC, and electrical systems are routed between

equipment, avoiding interferences. When the model has been

completed, checked, and verified, drawings are then created. In

this fashion the design is represented in the model; drawings are

used to communicate that design. Most 3-D systems have been

developed to enable the geometry of the drawing to be created by

projecting the image of the model into a 2-D window where clipping

and dressing-up of the image can be conducted. Notes and

dimensions are then added.

A duct work configuration different from the original conceptual

design was developed in 3-D. The new design could have been

conducted in the 2-D mode; however, communicating that design with

the 3-D model among the project participants proved to be very

effective.

The Construction Industry Institute (CII) estimates that the cost

of rework on industrial projects exceeds 12 percent of the total

project cost. Design deviations, changes, errors, and omissions

account for 80 percent of the increased costs. Construction

deviations account for 20 percent. The CII cost influence curve

also shows that the earlier construction experience, methods, and

knowledge are introduced to a project's design, the higher the

probability that these factors will influence the design and reduce

cost and schedule. With this philosophy in mind, two full time

construction supervisors were assigned to implement

constructibility issues early in the design of the project.

Construction worked closely with the engineers and designers during

the design process. Areas of concern included labor and material

access, scheduling, and construction equipment placement.

During the design process, Construction Specialists are reviewing

the models for constructibility. In the past these specialists reviewed completed drawings which did not allow a great deal of

flexibility to make changes. Now copies of the model are used

starting in the conceptual stages of the project continuing through

detailed design to assess site layout, craft and equipment access,

and ease of construction; implement modularization; size pipe

spools and locate field welds; plan the construction process;

select and size construction equipment; and create the construction

schedule. The 3-D design model provides the project with a

powerful communication tool utilized among all levels of the

40
project team, including project management, the owner, engineering,

and construction.

Computerized modeling also provides the capability to more fully

integrate both design and construction with the facility's

operations and maintenance requirements. This can be achieved by

passing the as-built model to the owner for future use and linking

the model to the owner's customized plant database.

Construction used the proposal model to refine the demolition

sequence of the existing precipitators and duct work. Crane

studies were conducted with a library of premodeled cranes to

analyze access, placement, capacity, and boom reach. A 4600

Manitowoc luffing tower crane was selected based on capacity,

reach, and the minimal number of setups required. After the crane

was chosen, sizes of the existing duct-work sections were then

identified for removal. The 3-D modeling system enables densities

to be applied to each modeled solid and the corresponding weights

to be determined. Cuts in the duct work were identified that

maximized the size of the sections to the capacity of the crane.

Centers of gravity were also calculated for each duct section to

identify rigging pick points. Using this quantitative information

obtained from the model, in conjunction with 3-D graphic images as

a guide, a preliminary outage demolition schedule was developed

using Primavera's Finest Hour scheduling package. The demolition

sequence model was then refined based on the critical path and

manloading capabilities shown on the schedule.

When the design reached the final stages, construction made copies

of the models and began to take them apart to experiment with

different construction scenarios. Duct work was again sized to the

capacity of the crane at the placement boom length. The new duct

work installation sections were analyzed and scheduled similarly to

the duct work removal sections. The demolition and installation

sequence models were integrated to facilitate a complete outage

construction sequence. This sequence model revealed that

modifications needed to be made to the corresponding duct work

construction schedule where original assumptions did not hold.

Isometric piece mark sketches were then created that identified the

duct mark number, weight, and sequence of installation. These

sketches were sent to the duct vendor, at their request, to assist

in the duct work fabrication and delivery schedule (Figure 3).

Using the 3-D system, construction personnel developed their own

erection drawings from the engineering models. Pipe spool sizes

and field weld locations were identified on the model, based upon

construction requirements. Isometric sketches were then developed

with each spool piece, hanger, and field weld identified. Welding

procedures and test information were included for each weld. The

materials management module provided an automatically generated

materials list, by spool piece, for each pipeline, which was fed

into the purchasing system. The isometric sketches and bills of

41
[• FAN OUTLET TO STACK BREECHING

its|

Its SCRUBBER OUTLET TO FAN INLET

ISOC

i IGA

Figure 3. Duct Piece Mark Sketch

42
materials were included in the bid packages to the prospective pipe

fabricators, along with the orthographic drawings.

When the Finest Hour construction schedule was completed, it was

downloaded to DXF format and uploaded into the modeling package.

The sequence model steps were placed around the schedule, matching

time frame and logic. The result is a document that provides all

of the logic and detail of the schedule and a 3-D graphic

representation of the project (Figure 4).

Three months prior to the start of the outage, the client delayed

the duct and scrubber modifications for approximately 18 months.

Business reasons were cited for the postponement, as well as

extensive boiler modifications scheduled during the same time

period and labor shortages in the area.

Prior to this announcement, Stone & Webster was awarded the boiler

modification construction work. This consisted of boiler water

wall panel replacement, asbestos removal, hot reheat pipeline

replacement, coal pulverizer refurbishment, and the replacement of

six feedwater heat exchangers.

Construction Specialists responded to this sudden change in scope

by again utilizing the 3-D modeling system. Facilities included in

the new contract were fully modeled using the owner's design

drawings, clarifying the scope of work and verifying preliminary

installation scenarios.

The model also proved to be invaluable when 3 weeks prior to the

start of the boiler modification outage, the owner requested that

the two existing precipitators be removed and replaced with duct

work. Using the design model, Stone & Webster's engineers were

able to select newly fabricated duct sections, previously designed

for use in the modified duct work arrangement, as transition pieces

in the precipitator area. Supports were designed as a combination

of the existing precipitator support steel and temporary support

modules. The ends of the transition pieces were modified to

connect the assembly to the existing boiler duct and the scrubber

duct. The temporary modification design was completed in only 4

weeks after notification.

These models also proved valuable on the jobsite in familiarizing

new construction personnel with the project. In the Spring of

1992, duct and scrubber outage planning and scheduling will begin

again.

43
Figure 4. Construction Sequence Model Linked to Schedule

44
Issues in Technology Transfer:

Sharing Experience Between Manufacturing and Construction

Arthur B. Baskin

Automation Support Center

Department of Computer Science

Department of Veterinary Biosciences

University of Illinois at Urbana Champaign

Stephen C-Y. Lu

Knowledge-Bases Engineering Systems Research Laboratory

Department of Mechanical and Industrial Engineering

Department of Computer Science

University of Illinois at Urbana Champaign

In manufacturing, construction, and infrastructure maintenance, there is an increasing premium

on solving large system-level problems in shorter times, with fewer resources, and without

compromising the quality of the result. In the manufacturing arena, the increasing complexity

of engineering products and the intense competition of the world market have combined to force

a change from the centralized methods of the past toward a more decentralized approach. This

decentralized approach deals with complexities by dispersing different product development

functions to a team of engineers, where each team member contributes special expertise to the

overall solution.

For complex construction projects or in situations where materials and/or building techniques call

for specialized expertise, the same sort of group coordination is required. In the best case,

solving the problem of coordinating the various sets of expertise leads to a shorter construction

process with an attendant cost decrease. In the worst case, the integrity of the structure can be

compromised when design or construction changes are made without adequate review by the

appropriate construction team members.

The condition of the national infrastructure will have a profound effect on the competitiveness

of U.S. industry in the emerging era of global competition (1). Here again, multiple interacting

constraints must be brought together to balance the competing costs of deferred maintenance with

present day outlays for repair or rebuilding. In much the same way that materials knowledge

must be brought to bear on developing useful, reliable, and economical manufactured products.

engineering life-cycle knowledge must be used to allocate limited resources for infrastructure

repair or replacement.

45
Arthur Baskin and Stephen C-Y Lu

Manufacturing, construction, and infrastructure maintenance all involve complex system-level

problems which, at best, can only be decomposed into multiple interacting sub-problems. These

sub-problems require cooperative conflict resolution among differing areas of required expertise.

While this approach allows more complex problems to be solved than more traditional methods,

it is more difficult to manage than previous approaches. Fortunately, computer tools for

cooperative work, such as those being developed for concurrent engineering, are beginning to

become available (2,3). While this emerging technology is still in its infancy, there is every

reason to expect that it will produce an impact on group or team productivity as profound as that

of the personal productivity systems on individual workers.

1. The Two Meanings of Technology Transfer

In all three of the areas discussed in this paper, technology transfer can mean either the transfer

from researchers to practitioners or the adaptation of tools from one discipline to another. In

preparing this paper, we have used both definitions of technology transfer. After discussing the

need for cultural change in the next section, we discuss issues which arise when information

systems are used as agents for transferring new decision making technologies from researchers

to practitioners. We illustrate these issues with examples drawn from our experience in

manufacturing and engineering logistics management. In later sections, we generalize currently

active areas of research in concurrent engineering to problems in construction and infrastructure

maintenance. By looking at the challenges, requirements, and solutions being developed for

system-level engineering problems, we may be able to benefit from work done in one area by

transferring techniques, if not actual tools, from one discipline to another.

2. The Need for Cultural Change

As we briefly outlined above, there is a need for a change in the traditional decision making

culture in manufacturing, construction, and infrastructure maintenance. In each case, separate

(and usually serial) decision making needs to be replaced by a more parallel process emphasizing

cooperative conflict resolution. Traditional manufacturing design was a serial process in which

communication was frequently in the form of specifications and drawings. In this approach,

conflicts lead to expensive backtracking in order to revise early design commitments in light of

downstream factors. The current emphasis on concurrent engineering represents a change in

culture away from this serial approach.

Figure ' illustrates the evolution of product development practice with its increasing emphasis

on concurrent engineering. As we shall discuss in greater detail in the remainder of this section,

manufacturing has evolved from centralized product development to distributed product

development on its way toward true concurrent development. Construction and public works

infrastructure mranagement are already highly decentralized and will need to converge on a more

concurrent planning process in order to improve.

46
Sharing Experience Between Manufacturing and Construction

Complexity

high

.. ..... . . .:..... . . . .". . . . •: .11.: 

.. ...

.::i low

lOW -, • Lead-Time

" , long . - short

high - - - - -

Q :centralized product development (past) Quality () :distributed product development (present)

:concurrent product development (future)

The concurrent product development practice (also called Concurrent Engineering) strives to:

* Shorten product development lead-time

(better manage life-cycle concerns)

* Manage high product complexity

(through tightly integrated functions)

9 Increase product competitiveness

(keep high quality with low costs)

in order to maximize the overall product value.

Figure 1. Competitiveness of Product Development and Its Evolution

47
Arthur Baskin and Stephen C-Y Lu

2.1 The Need for Increased Communication and Coordination

In large construction projects in the U.S., there is frequently a separation between the

architectural designer and the construction team. Again, there is a relatively low bandwidth

communication channel between these two groups (e.g. architectural drawings and associated

specifications). As in the manufacturing case, design rationale is rarely captured in such

documents making it difficult to make the inevitable modifications due to the arrival of

downstream considerations. Based on the experience with manufacturing design, it seems clear

that a change will be required in this arm's length relationship between the necessary components

of expertise. Indeed, this change has already begun in Europe where it is not unusual for an

engineering design firm to receive a separate contract to oversee construction according to its

design.

As much of the U.S. infrastructure ages, it will become progressively more important to use fiscal

resources wisely. In such areas as maintenance of the nations navigable waterways, it is only

now becoming possible to adequately inventory the state of this component of the infrastructure.

In many cases, construction and repair materials and techniques have changed radically since

original construction. In addition, the experience with existing structures now provides life-cycle

models that can be used to predict the future course of maintenance activity. Unfortunately, these

three sets of information are rarely found in a single individual or even a single group. As in

the two cases above, a change of culture is required to break down the barriers between existing

groups of experts in order to improve the quality of decision making, and thereby, the

infrastructure itself.

2.2 The Need to Reward Innovation and Its Attendant Risks

In addition to the need to change from a serial information flow and decision making process to

a more parallel process, there also needs to be a qualitative change in the character of the

decision making. In the manufacturing arena, this change is usually described as a need for

innovation. In construction and infrastructure management, this change is usually described as

a need to promote more experimentation and, thus, risk taking behavior. In each case, a change

in the nature of the decision making process will be required. Although not apparent on the

surface, these two qualitative changes are really aspects of the same underlying mechanism.

Promoting design innovation is not possible without making it sufficiently safe to try new

materials or new product definitions. Promoting innovation in construction also requires making

it sufficiently safe to try new materials or construction methods. As long as it remains

impossible to wave a magic wand and remove risk, the only way to reduce individual risk will

be through risk sharing. Whether by bringing downstream design considerations to bear on early

manufacturing designs or melding architectural design rationale with construction and life-cycle

expertise, it will be essential to change the current serial and adversarial conflict resolution into

a more parallel and cooperative process.

2.3 The Need for the Right Amount of Decentralization

In manufacturing, concurrent engineering will mean a more decentralized process in which

48
Sharing Experience Between Manufacturing and Construction

relatively independent agents coordinate their activities to achieve a common goal. In

construction and infrastructure management, the problem is that the process is currently too

decentralized. In these cases a more centralized process will be required. Judging from the

recent experience with manufacturing design, the challenge will be to avoid over shooting the

desired equilibrium point where the currently adversarial independent agents engage in

cooperative conflict resolution.

3. Information Systems as Agents of Cultural Change

In working with engineering field offices at U.S. Army installations in the continental United

States and Europe, we have noted, and occasionally exploited, the role of computer-based

information systems as agents of change. A new information system can either reinforce existing

patterns of communication and problem solving or it can disrupt existing patterns. In working

with Directorate of Engineering and Housing (DEH) offices, we routinely suggest that a

conscious decision be made about which role new technology is to play. When the decision is

made to introduce new patterns of communication, it is also necessary to provide administrative

support for the new system (which is not usually required for automating existing patterns).

Implementing the cultural changes outlined in the previous section will be facilitated by using

information systems as an agent for change. As at the DEH, this change will require additional

administrative support. By implementing information processing systems that foster a new

pattern of information sharing and decision making, we can build an information processing

infrastructure that will positively reinforce the desired changes. Having now resolved to build

computer-based information systems to foster a change in decision making culture, we will

discuss some of the constraints on such development in the remainder of this section before

discussing the importance of timing in the next section.

3.1 Information Systems Should Support Evolution Not Revolution

As appealing as a revolutionary change in information processing might appear, revolutionary

change is almost never possible. Even such apparently revolutionary technologies as local area

networks and CAD work stations are actually well grounded in previously existing patterns of

information sharing and design document presentation.

As an example of the need for evolution, consider our experience developing tools for capturing

design rationale. In our early tool development, we produced a computer-based system which

debriefed an engineer to capture a detailed statement of overall and component design rationales.

While the system worked as we intended, it required the engineer to separate out a component

of activity which is not naturally separated from the process of designing an artifact. Even

though the potential benefits for design reuse could be quite large in the future, engineers

preferred not to use the separate design rationale system because it actually interfered with

current practice. Based on these reactions, we are now developing techniques to embed design

rationale capture in more traditional design tools in order to provide a more natural method of

capturing design rationale.

49
Arthur Baskin and Stephen C-Y Lu

3.2 Information Systems Should be Grounded in Current Practice

Even when using new information systems to promote cultural change, we have found it wise

to conduct empirical studies of human problem solving in order to better match our tools to

patterns of human information sharing and problem solving (4,5). New tools which conform to

existing patterns of human cognition and problem solving will be more readily assimilated than

tools which require users to adapt to inefficient patterns.

As the design rationale example above indicates, it is possible to evaluate tools by developing

them and metering their effectiveness with actual users. Unfortunately, this generate and test

approach is terribly inefficient and is part of the reason why only a small fraction of developed

software systems are actually put into widespread use. In our work with engineering design, we

have used a different approach. We have conducted empirical studies of architectural design and

aircraft design in which we have analyzed the actions of interactive design teams. We have

looked both at expert and novice behavior. In these situations, we have concentrated on routine

design problems and identified the types of problem solving behavior found. Surprisingly, even

in routine design where one might expect that use of previous patterns might dominate, we have

seen a preponderance of conflict detection and resolution behavior. Thus, even in cooperative

(i.e. non-adversarial) groups, communication of mutually interacting constraints on the solution

plays a dominant role. This rapid folding together of constraints on the solution from different

perspectives leads to better decisions in shorter times.

As part of our development effort, we analyzed transcripts of problem solving activity and

formed a basic theory conflict management for cooperative conflict resolution. Figure 2 shows

a portion of the conflict hierarchy which we developed. In our complete conflict hierarchy, we

were able to identify types of conflicts associated with resource management design and routine

design. Figure 3 shows a schematic diagram of a computer-based system which we developed

to provide conflict management advice to a group of cooperating experts (human and/or

machine). These two figures, taken together, illustrate the pattern of deriving functionality

requirement from studying human performance and then building tools that match the human

performance requirements.

As another example of the importance of grounding new systems in a knowledge of current

practice, consider the development of branching questionnaires to collect medical histories.

These systems were developed in the early 1970s to meet a perceived need for collecting more

complete histories than is possible in a normal office visit. Apart from some managed care

systems in California which used the systems as screening devices, the systems were a failure.

In an effort to be comprehensive, these systems generated so many false positive responses that

their reports were too lengthy to be digested by a physician before an office visit. For this

reason, the systems have not been incorporated into medical practice despite studies that clearly

demonstrate their effectiveness at information gathering. They simply do not fit current practice

and do not provide a sufficiently great benefit to offset their perceived cost.

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Sharing Experience Between Manufacturing and Construction

conflict instances (-60) and resolutions (-200)

were collected and analyzed to build hierarchy

of conflict classes with resolution strategies

All Conflicts I

I I

Objections Conflicting

by Critics Recommendations

Global Domain Shallow Differing Default

Expert Expert Model Local Assumption

I 

MMaxima

Numerical Resource Functional Number

Constraint Limit Constraint Valued

Violated Exceeded Violated Feature

Anticipated Actual One Side Both Sides

Usage Usage Flexible Flexible

Worst Likely Budget Budget

Case Usage for for

Usage Total Design

Design Subtask

Figure 2. A portion of a conflict hierarchy obtained by analyzing a the problem solving behavior of human experts involved in architectural design and local area network

design.

51
Arthur Baskin and Stephen C-Y Lu

"* design agents consist of distinct domain design and conflict

resolution components

"* CR component maps conflicts to conflict classes to specific

suggestions via dialogue with design agents involved in

conflict

Conflict Collect Advice

Classes General Advice

I Instantiate

, Advice

M04P To Colasics / Specific

Clsss CR Plans

Pick CR Plan

G":h

Resolve Conflict CR Plan

Nt Execute

SCR Plan

Conflict Queries Actions Manifestation Using Query Using Action

Conflict Language Language

Detectiont

Inconsistent

Design

State

A search taxonomy for classes whose abstract

preconditions subsume conflict . use abstract

"query" language, e.g.

conflict involves critique?

component isa resource-conduit?

untried plans for goal?

A fill in "slots" in associated strategies with contextspecific values to produce specific advice

expressed using action language

Figure 3. A computational model for conflict resolution based derived from the study of

cooperative conflict resolution by groups of human experts.

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Sharing Experience Between Manufacturing and Construction

3.3 Exploit the Natural Evolution of System Level Problems

While it would be possible to blindly apply concurrent engineering tools to problems in

manufacturing, construction and infrastructure management, such an approach ignores much of

what has been learned in the last ten years. Improving the quality of decision making in these

areas requires more fundamental considerations than just simply implementing better procedures

for cost controls or managing change requests. We must examine the complexity of concurrent

engineering from the perspective that this approach is intrinsically a system-level problem. In

general, there are three required levels of understanding, namely event, process, and methodology

which must be understood before sound solutions to a system problem are possible. The event

level focuses on individual results (or cases) and experiences gained from these results. The

process level involves underlying reasons (e.g. physics, mechanisms, rationales) upon which the

events were based. At the methodology level, various paradigms and theories, either empirical

or analytical, are proposed to explain and guide event occurrences based on the understanding

of their respective processes. It is important to note that one can only arrive at a sound system

solution through a gradual evolution through these consecutive levels of understanding.

Table I summarizes research and development challenges in manufacturing, design, concurrent

engineering, and infrastructure management. In manufacturing, different operations (i.e. events)

were treated as black boxes and experience-based knowledge dominated the community before

1950. The work of Dr. M. E. Merchant in 1950 marked significant turning point with the

introduction of the notion of manufacturing systems (6a). Unfortunately, early research attempted

to leap directly to a systems approach without a sound understanding of manufacturing processes

and methodologies. As a result, even though discussion of manufacturing systems continued

from the 1960s through the 1980s, the significant research results in this era were reported from

the studies of the physics involved in various manufacturing processes. Results from these

studies gave us a clear understanding of detailed mechanisms and enabled us to propose different

methodologies to control manufacturing operations for improved results. Only after this long

journey through event, process, and methodology, are we now able to produce useful results for

manufacturing systems, 30 years after Merchant's initial proposal (6b).

Although not thought of as a system-level problem yet, recent research on engineering

maintenance and repair (REMR) has begun to exhibit many of these properties (7). Early field

work emphasized the need to inventory and, later, inspect the condition of such large civil works

structures as locks and other structures within navigable waterways. During the past six years,

a number of computer-based systems have been developed to automate the maintenance of

inspection data for these structures (8). These programs have recently grown to emphasize the

reporting of status for groups of structures and attempts to use life-cycle process knowledge to

assign a condition index (CI). The condition index along with its underlying rationale is

comparable to the physics of manufacturing discussed above. Surely, system level integration

and coordination of activity was an implicit goal of the REMR effort. Unfortunately, the data

from inspections and validation of CI calculation mechanisms is not yet assernbled into

methodologies for infrastructure management. Based on the experience with manufacturing,

results becoming available from the use of REMR tools over the next few years should spur the

development of new paradigms and theories of managing large infrastructure systems. These new

paradigms will need to be embodied in infonriation systems in order to be most effective.

53
Arthur Baskin and Stephen C-Y Lu

Exploit Natural Evolution of

System Problems

Levels

Event Process Methodology System

results physics paradigms integration

Focus experience mechanisms theories cooperation

Manufacturing 1950 early 1980s mid 1980s late 1980s

Design mid 1980s (?) late 1980s (?) (?)

Concurrent

Engineering (?) () (?) late 1980s (?)

Maintenance

and Renair late 1970s Mid 1980s Early 1990s (?)

Financial Tracking Materials REMR Life Cycle

Examples and Invencory Research Condition Index

Table 1. System-level problems naturally evolve from events through process and

methodology before a true system solution is possible. This table shows history

and status of the movement toward concurrent engineering as well as the

analogous situation for maintenance and repair.

54
Sharing Experience Between Manufacturing and Construction

4. Decisions Have an Optimal Time to be Made

The case for the importance of decision timing is very strong. Figure 4 shows a typical cost

break-down for a product development process involving conceptual design, detailed design,

manufacturing planning, and production stages (9). These stages could just as readily be design,

planning and construction stages for a large construction or civil works project. There are two

types of costs, one for the committed cost (i.e., the % of final product market cost that is being

determined at that stage) and the other for the incurred cost (i.e., the actual expenses of product

development activities at that stage) indicated for each stage in the figure. It is clear that a

majority (about 80%) of the final product cost has already been determined at the end of the

detailed design stage. This leaves only very small opportunities for cost improvement at the

production phase where a majority of actual expenses are incurred. It is interesting to note that

the area above the upper line can be seen as the opportunity for improvement, and the area under

the lower line can be viewed as the cost for regret. In this way, the challenge of concurrent

engineering can be defined as "how to make sound decisions at early stages of product

development where committed costs are high (or how to maximize the opportunity for

improvement by increasing the area above the upper line)?". Similarly, it can also be defined

as "how to avoid changes at later stages where incurred costs are high (or how to minimize the

cost for regret by reducing the area under the lower line)?".

The key message from Figure 4 is that sound decisions must be made at early stages to avoid

(or minimize) subsequent engineering changes. This is because that engineering changes are the

main "cost-driver" in product development. For example, engineering changes have been a

main factor in determining the product competitiveness between U.S. and Japanese manufacturers

as illustrated in Figure 5. The figure compares the pattern and amount of engineering changes

in a typical U.S. (dotted line) and Japanese (solid line) company in the automotive industry (10).

As can be seen from this figure, most engineering changes in a Japanese company occur between

36 to 24 months "before" the date when product is introduced to the market (the D day), and

there are almost no changes afterwards. In contrast, engineering changes in a U.S. company

occur much later during the process, reaching a peak during the production stage, and continuing

on even after products are on the market.

The significance of this comparison is not only on the number of engineering changes processed

(the Y axis) but, more importantly, the time when those changes occurred (i.e., the pattern

distribution along the X axis). Again, engineering changes at early stages of product

development have lower costs and can help to minimize future changes. This is a very important

point and must be incorporated into concurrent engineering computer tools.

In both of the cases above, the most important observation is that the value of decisions at

different point in the development process is not uniform. In general, design decisions which

include downstream considerations at earlier times will be more valuable than those which

serialize the process.

55
Arthur Baskin and Stephen C-V Lu

Different Costs for Product Development

QD. Design Engineering Manufacturing Engineering n

_a_ OpportunityI

for:.I

Improvement I

% ofTo alCosts 4

: con tted

1 0 inc4rred j1

- - - -- - - - Cost for R R egret 1

Conceptuail Dctaiilcd Pkt111iinig Productionl

Concurrent Engineering Challenges:

"* How to make sound decisions at early stages?

- (i.e., to maximize the opportunity for iml)roveineclt)

"* How to minimize changes at later stages?

- (i.e., to minimize the cost for regret)

Figure 4. Different Costs During Product Development Stages

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Sharing Experience Between Manufacturing and Construction

Benchmark Comparison of Engineering Changes

No. of Engineering

Changes Processed

U.S.-•C•mpany "es-rn..-

* S

Japanese S

Company

Recalls

*0 S

The D Day

Months of

I Product

-36 -24 -12 Job #1 12 24 Development

Concurrent Engineering Challenges:

• How to reduce the total number of engineering changes?

* How to minimize engineering changes at later stages?

* How to best manage and support engineeering changes?

(if they are not avoidable!)

Figure 5. Benchmark Comparison of Engineering Changes

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Arthur Baskin and Stephen C-Y Lu

5. General Requirements for Concurrent Engineering Tools

In order to transfer technology between disciplines we should understand how the challenges.

current techniques, and future requirements of the disciplines relate. Technology transfer bet%,een

disciplines based on such a foundation is more likely to be effective than the use of isolated

techniques. In this section we explore requirements originally developed for concurrent

engineering in manufacturing settings which should also apply to construction and civil works.

To develop a new design, engineers use their specific domain knowledge to generate geometrical

shapes and relationships which, in term, result in a set of data defining the product specifications.

For mechanical products, knowledge, geometry, and data are the three basic entities that

engineers must effectively deal with in order to make good decisions. At the beginning of the

computer-aided engineering era, many tools were developed to support data-intensive tasks such

as engineering data bases and simulation programs. Those tools are useful mainly for the later

stages of product development (e.g., analysis of product performance) where product knowledge

and geometry have already been decided. The development of various computer-aided drafting

and design programs (e.g., CAD) over the past two decades have produced computer tools for

geometry-intensive tasks. Those tools are useful during intermediate stages of development to

represent product knowledge in geometric forms to be converted into engineering data for

downstream activities. Recently, artificial intelligence (Al) techniques have been used to build

expert systems to support various engineering decision-making tasks (11). Although their full

potential is yet to be seen, Al-based tools should be more suitable for knowledge-intensive tasks

at earlier stages of product development than those traditional geometry- or data-oriented tools.

As engineers go through the early, intermediate, and late stages of product development, the

challenges of their tasks shift from being knowledge, geometry, and data intensive accordingly.

Therefore, as more computer tools are being developed to support early activities, the foci of

these software developments are being extended from data and geometry to knowledge about the

product. Unfortunately, current computer tools for supporting data, geometry, and knowledge

intensive tasks are often developed in isolation from each other. As a result, they are only useful

at a particular stage of the development process. To move from one stage to another, it is

common for engineers to change to different computer tools (e.g., data-based, CAD-based, or Albased) to cope with the changing requirements of different product development tasks. This

results in many wasted efforts and prevents the integration of various product development

concerns required by concurrent engineering. To overcome these difficulties, more intelligent

software must be developed to support knowledge-intensive tasks and integrate with existing

geometry- and data-oriented tools (12). This section will examine some functional requirements

of computer tools that are useful for knowledge-intensive, decision-making tasks in concurrent

engineering. Specifically, we will discuss these requirements (denoted as R) according to their

roles in the following activities needed for concurrent engineering:

integration of complementary engineering expertise (R-a-),

cooperation of multiple competing perspectives (R-b-),

communication of upstream and downstream concerns (R-c-), and

coordination of group problem-solving activities (R-d-).

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Sharing Experience Between Manufacturing and Construction

5.1 Integration of Complementary Engineering Expertise

In order to effectively incorporate life-cycle considerations, different engineering expertise must

be "integrated" during the product development process, rather than "interfaced" afterwards.

Knowledge representing complementary expertise must be shared among product engineers before

they reach their individual solutions (13). The following four functions are required to support

the knowledge sharing and expertise integration during product development:

(R-a-1) Combine numerical/symbolic representations: Some of the product development

expertise, such as performance analysis, will have numerical representation while others, such

as manufacturability checking, may be more suitable for symbolic representation. A useful

concurrent engineering tool must be able to treat numbers and symbols indifferently with a

uniform representation to facilitate the true integration of different complementary expertise.

(R-a-2) Break the synthesis/analysis barriers: With traditional practice, synthesis and analysis

are done separately and iteratively through the product development process. To minimize

engineering changes, the barriers between these two tasks must be broken so that they can be

done simultaneously. In order to do this, computer tools must be able to effectively reason (or

calculate) from inputs to outputs and vice versa. This requires multi-directional data propagation

among problem attributes within the tool.

(R-a-3) Adapt to standard data definitions: One major difficulty of integration in the current

practice is that computer tools for different engineering tasks, such as design, planning, and

scheduling, all use different data definitions. Data incompatibility prevents sharing of expertise

and makes cross-functional consistency checking impossible. Efforts in developing standards for

data definitions, such as PDES/STEPP and IGES, are important to the realization of concurrent

engineering.

(R.a-4) Integrate with CAD and database tools: As explained before, any decision support

tool at the knowledge level must be integrated with software for representing geometries and

storing data. This integration is more than just creating file links or software pointers between

different programs. It requires the ability for decision support tools to truly "reason about"

knowledge implicitly available from geometry and data programs.

5.2 Cooperation of Multiple Competing Perspectives

Product development practice is not a pure scientific activity, and product decisions are always

perspective-driven. A major challenge in concurrent engineering is to effectively manage

competing perspectives to maximize the values of differences during the product development

process (14,15). The followings are desired functional requirements for managing competing

perspectives:

(R-b-1) Record decision histories and rationale: Since product development is a "process"

of making decisions, records of how different decisions evolve (i.e., history) and why they evolve

in a particular way (i.e., rationale) are useful for the management of various perspectives. Most

current computer tools, such as CAD and databases, only document "results" of product

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Arthur Baskin and Stephen C-Y Lu

decisions without keeping track of their heritage. They act as "static cameras" taking snap shots

of product development results. Concurrent engineei a;:' tools must be able to record histories,

assumptions, rationale of various decisions. Such rc,t,,' ds can minimize the risk of making

changes which violate early assumptions, provide bases for systematic conflict resolutions, and

facilitate communication and coordination among product development team members (see R-cand R-d-).

(R-b-2) Automate consistency maintenance: Most existing tools are "inactive" in the sense

that they allow inconsistent specifications to exist in the product model before its execution. A

way to minimize changes at later stages is to have computer tools that can immediately "complain about" (or detect) inconsistent decisions at the time when they occur. Such reactive

tools are very useful for supporting individual and group "what-if" analyses to ensure that

innovations do not violate the global states of consistency. Since the burden of maintaining

consistency is shifted from human to computers, engineers will be more willing to try new

alternatives, consider different opinions, and accept "better" ideas from others.

(R-b-3) Facilitate conflict management: Competing perspectives lead to conflicts which must

be detected and resolved before the product development process can proceed. In a typical

product development team, a significant portion of engineers' time and resources are spent

detecting and resolving conflicts. Therefore, computer tools that support conflict management

activities will be of great value to concurrent engineering. Methods must be developed to

automatically identify the sources of conflicts, suggest possible resolution strategies, and

summarize consequences of proposed changes. Once certain changes are decided to be necessary

(by either engineers or computers with human consent), the tools should automatically carry out

these changes (with human supervision) and detect any side-effects. Decision histories and

rationale play an important role in automatic conflict management as previously explained.

(R-b-4) Provide comprehensible explanations: The ability to explain ones decisions to other

concerned parties in a comprehensible manner is crucial to integration, cooperation, and

coordination among product development team members. Computer tools which can provide

understandable explanations of decisions will be beneficial to engineers who often need to

explain what they did, how and why they did it to their colleagues. This requires more than just

printing out pre-stored textual information. The explanations must be automatically tailored to

particular viewpoints with proper levels of details for those concerned engineers. Graphical

representations of explanations (e.g., graphs of dependency networks) are often useful for easy

comprehension. Again, good records of decision histories and rationale play an important role

in these explanation activities.

5.3 Communication of Upstream and Downstream Concerns

Iterations and changes at later stages can be minimized if downstream product development

concerns can be communicated upstream to those who make decisions at early stages. Therefore,

computer tools must be developed to promote and support early communications among product

engineers to avoid iterations and changes (16). These tools must also provide representations of

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Sharing Experience Between Manufacturing and Construction

decisions in a manner suitable for communication. The following functional requirements must

be considered:

(R-c-1) Support the least commitment approach: A way to facilitate upstream and

downstream communications is not to make premature commitments or specifications, leaving

room for others to express their concerns later on. This is called the least commitment approach

to problem solving in Al, and is a very useful concept to promote communications in concurrent

engineering. For example, one way to support the least commitment approach is to develop

computer tools that allow interval value specifications. In the early stages of product

development, few details may be explicitly known. Engineers can use intervals to specify

acceptable ranges of values based on upstream concerns, leaving these intervals to be further

refined by others at later stages where downstream concerns become apparent. Traditional tools

only support atomic value specifications (e.g., single numbers or symbols) and, hence, force

engineers to commit to specific values unnecessarily. In contrast, interval values, much like the

tolerance concept in design and manufacturing integration, can make product decisions more

"communicable" to promote concurrent engineering.

(R-c-2) Adaptive focus at multiple abstraction levels: Upstream and downstream product

concerns are often expressed with different levels of abstraction. Therefore, computer tools must

be able to support reasoning with adaptive focus for concurrent engineering communication.

Given a specification of "interests" based on engineers' different roles in the product

development team, such tools must be able to automatically mine out relevant information from

generic product specifications. As engineers change their interests at different stages, these tools

must adapt their focus of information mining accordingly. Without such tools to support adaptive

focus, engineers will be overwhelmed by the amount of information, most of which is not

directly relevant to their current interests, and unable to communicate effectively at the proper

time.

(R-c-3) Facilitate early evaluation of decisions: Early evaluations are important because they

can eliminate unpromising choices before major resources are consumed. However, upstream

evaluations are difficult because most traditional analysis tools require very detailed decision

specifications and, therefore, can only be used for downstream analyses. Methods must be

developed to form analysis models based on downstream detailed knowledge to support early

evaluations of upstream decisions. With these early evaluation models extracted from

downstream knowledge, product decisions can be gradually refined at optimized at various stages.

(R-c-4) Provide hypothetical reasoning: Since not all the concerns are explicitly known at

upstream, engineers often need to hypothesize downstream conditions to generate several different

product scenarios. Hypothetical reasoning is an important activity in product development, and

good computer support for this activity can greatly assist concurrent engineering. There are

several software techniques from AI, such as multiple worlds and truth maintenance systems,

which can be used to support multi-scenario reasoning based on different hypotheses and can

automatically merge different scenarios when necessary. These techniques must be further

developed and integrated to support hypothetical reasoning at different abstraction levels for

concurrent engineering.

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Arthur Baskin and Stephen C-Y Lu

5.4 Coordination of Group Problem-Solving Activities

Concurrent engineering is inherently a group activity and, therefore, group productivity" is a

main concern. To date, most computer tools are design for enhancing individual productivity.

New tools must be developed to support group interaction of engineering teams with different

technical backgrounds and geographical locations (17). These interactions could be centralized

or distributed, synchronous or asynchronous, technical or administrative, and involving both

people and machines. For the concurrent engineering purpose, these group productivity tools

must meet the following requirements:

(R-d-1) Deal with homogeneous and heterogeneous tools: Unlike small groups where members

are likely to use similar tools in problem solving, heterogeneity of computer tools always exists

when dealing with large engineering groups or a collection of small groups. Group productivity

tools must be able to accommodate small and large groups with similar and different tools. These

group tools should act as a common platform for group work, allowing results generated from

different tools to be integrated. The issues related to unified representations, standard data

definitions, and automatic consistency management discussed above play important roles in

supporting this group-work platform.

(R-d-2) Manage ownerships among group members: Although engineers are encouraged to

share ideas and work cooperatively in concurrent engineering, they must declare and control

ownership of some product decisions in order for the product development team to be effective.

Without some technical authority of decisions, it is impossible to assign and evaluate the

responsibilities of engineers in the team. Computer tools must automatically manage these

ownerships and responsibilities of decisions as they are declared and agreed by the group

members. These tools should also allow sharing and changing of ownerships as necessary and

manage these situations accordingly.

(R-d-3) Support synchronous and asynchronous interaction: Depending on the nature and

stages of product development, the required interactions in a product team can be either

synchronous or asynchronous. Supporting synchronous interaction is important because it allows

implications and feedback of one engineer's decisions to be immediately known by the group

members. However, such instantaneous interactions could sometime cause instability of the

overall team development efforts and discourage innovation by team members who might wish

to try out some new ideas without being publicized right away. Since good ideas take time to

mature before they can be seriously shared, engineers may sometime prefer asynchronous

interaction with large time delay. Group productivity tools for concurrent engineering should be

able to support both types of interactions.

(R-d-4) Promote local and remote interaction: Engineers who have required product

development expertise may not come from the same location, and yet still need to interact during

the product development process. Computer tools which can create "virtual co-location' among

engineers regardless of their actual geographic locations are needed for concurrent engineering.

New hardware and software technologies, such as local and global area networking, multimedium information systems, and distributed databases supporting consistent and persistent data

storage, are all important to this activity.

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5.5 Three Fundamental Requirements

Among the above 16 functional requirements of concurrent engineering tools, three are most

fundamental (12,18) to software development as indicated by the axes of Figure 6. The X axis

represents "perspectives" which refer to different life-cycle concerns such as function, structure,

manufacturing, and maintenance. On the Y axis, "stages" indicate the current stage of decisionmaking activities, ranging from the early stage of conceptualization to the final stage of detailed

analyses and production. The Z axis represents "participants" and refers to the number of

engineers required for developing a competitive product. It is interesting to note that most

conventional, computer-aided engineering tools available to date only support a single

perspective, are biased toward a particular stage, and are only suitable for an individual user.

These tools are represented as a single point at [0,0,01 in Figure 6. In contrast, computer tools

for concurrent engineering must ideally be able to incorporate multiple perspectives, support

multiple stages, and work with multiple participants. They are represented by the volume of the

[1,1,1] cube in Figure 6. Basic research efforts are needed to extend current computer-aided

automation technologies from zero-dimension (a single point at [0,0,0]) to three-dimension (the

volume of [1,1,1] cube) to support concurrent product development (19).

6. Some Recent Results

There are many different approaches available for developing concurrent engineering computer

tools. Good examples are the Taguchi method (20) and the Axiomatic design principle which

have been explored as ways to support design and manufacturing integration (21). In fact, since

concurrent engineering is a system-level problem, any approach that can improve on system

solutions is useful. In this section, we will introduce some recent results from an extended Albased approach, called the Knowledge Processing Technology (KPT).

6.1 The Basic Concept of Knowledge Processing

The need for developing computer tools that can handle multiple perspectives, stages, and

participants calls for a new automation foundation beyond the current foundation which is based

on the data processing technology (DPT). We developed KPT as a new foundation which

allowed us to build computer tools that could manipulate higher level information contents than

what was possible with DPT. In a generic sense, KPT can be defined as a logical set of software

techniques, from both Al research and traditional engineering methods, that can increase the

utility of engineering knowledge to support complex decision making tasks (22). An important

concept of KPT is the distinction between data and knowledge. Both knowledge and data are

problem-solving information with different representations and utilities. Knowledge represents

the structure, meaning, usage, justifications, interpretations, and other high-level concepts of data.

In contrast to data, knowledge is more flexible, comprehensible, and can be dynamically

inferenced (rather than statically retrieved). While data keeps records of past events, knowledge

lies within the models that give proper meaning to data for future applications.

Due to the above differences, processing data is sufficient for interfacing of mass-production

automation tasks while processing knowledge is required for integration of highly flexible

production systems. Interfacing and integration differ in the method and degree by which

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Arthur BasiWn and Stephen C-Y Lu

Tool Requirements for Concurrent Engineering

Computer tools that are useful for cooperative team support in

concurrent engineering must have the following characteristics:

Stages 0 :current automation technology

(Y) o :concurrent engr. requirements

multiple

I I-- I•-•

II I

singlc I ,il , j ..- (X) PcrspcCtivcs

I [0,0,0 . multiple

(Z)• W0'multiplc mlm

Participants

The ability of modeling engineering know-how, know-why, and knowwhat intelligence by KPT makes the development of these computer

tools possible.

Figure 6. Three Fundamental Requirements for Concurrent Engineering Tools

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Sharing Experience Between Manufacturing and Construction

sub-tasks communicate with each other during problem solving. If no problem-solving

knowledge is shared between sub-tasks during the formation of their respective solutions, and

sub-solutions are only pieced together at their result level, it is considered an interfaced approach.

On the other hand, if problem-solving knowledge is communicated among sub-tasks before

arriving at their respective solutions, it is an integrated approach. Essentially, interfacing can

occur at the result level via data communication, but integration must occur at the task level

through knowledge exchange. Based on this definition, traditional product development is an

interfacing approach (and hence DPT is sufficient) while concurrent product development calls

for an integrated approach (and hence requires KPT).

KPT utilizes modem computers' extensive processing power to process knowledge directly,

thereby elevating the current focus of automation in industry from data to knowledge. KPT

consists of five basic knowledge processing operations, namely Knowledge Acquisition,

Knowledge Representation, Knowledge Integration, Knowledge Coordination, Knowledge

Utilization. The two KPT operations which have not been widely recognized in traditional

approaches (e.g., expert systems) are knowledge integration and knowledge coordination, both

of which are important in concurrent engineering. Existing techniques for knowledge acquisition,

representation, and utilization, although widely recognized as important aspects in traditional

approaches, are not sufficient and are being extended in KPT research.

6.2 The Impact of KPT on Concurrent Engineering

Generally speaking, KPT offers the following two fundamental advantages over DPT as a basis

for developing computer tools to support concurrent engineering (23):

• Because knowledge contains high-level meanings and justifications of data, processing

knowledge directly can expand the types of intelligence that can be explicitly modeled on

computers. This expanded set of intelligence includes know-how knowledge which specifies how

domain knowledge can (and should) be used to solve a particular problem, know-why knowledge

which explains why a know-how knowledge is being applied in a particular way, and know-what

knowledge which indicates what are important aspects to focus on (or adapt to) at a particular

stage of decision making. To be effective, concurrent engineering tools must be able to capture

these three types of product development intelligence.

* Because knowledge captures the concepts, usages, and structures of data, KPT is useful

for integration of complex engineering and software systems. For software integration, KPT

provides opportunities of integrating computer tools, such as CAD packages and data bases,

which are built upon DPT. In fact, KPT can serve as an integration platform upon which

knowledge-, geometry-, and data-intensive tools can be unified and coordinated. As previously

explained, such an integrated computer environment that can process engineering knowledge,

geometry, and data seamlessly is very critical to the realization of concurrent engineering.

65
Arthur Baskin and Stephen C-Y Lu

The combined effect of the above two advantages allows KPT to be used to explicitly model

different competing concerns to support a group of engineers cooperatively working on a product

development task at different levels of detail. This makes KPT a very suitable foundation for

building intelligent computer tools that can handle multiple perspectives at different stages for

multiple users, meeting the fundamental requirements of concurrent engineering as specified in

Figure 6.

6.3 Core KPT Tools for Concurrent Engineering

Based on the generic concept of knowledge processing, various KPT tools (see Figure 7) have

been developed at the Knowledge-Based Engineering Systems Research Laboratory (KBESRL)

to support different aspects of concurrent engineering (24). In Figure 7, the bottom layer shows

basic software techniques used in the development of our KPT tools. As can be seen, there are

many Al-based techniques integrated with traditional engineering methods. The middle layer

indicates the three generic software environments which form the core KPT technologies: IDEEA

for know-how knowledge, AIDEMS for know-why knowledge, and AIMS for know-what

knowledge. The upper layer presents those application-specific systems and prototypes resulted

from the above three generic environments, as well as general software systems that extend the

functions of the generic environments. These extended environments integrate the basic

capabilities from the generic ones and provide more robust supports within different engineering

domains. The following discussions briefly review the CORE KPT software developments and

functions (in reference to the requirements identified in Section 3), and then introduce current

efforts to apply, enhance, and integrate these core KPTs for real-world concurrent engineering

problems (see the upper layer of Figure 7).

6.4 Processing Know-How Knowledge for Concurrent Engineering

We developed an Intelligent Decision Environment for Engineering Applications (IDEEA) (see

Figure 5) as our core KPT for know-how knowledge for concurrent engineering (25). Several

software techniques from Al are employed in IDEEA to form an integrated, domain-independent

problem-solving environment. Within this environment, a frame-based scheme is used to

represent domain objects and composite values (i.e., numbers, symbols, sets, and intervals) are

employed to represent data (R-c-l). A constraint-based language and the rule-based system

serve as the primary and the secondary modes of computation. A truth maintenance system is

used to record dependencies for all domain objects and values (R-b-2). The constraint system

allows multi-directional propagation of composite values and, hence, supports the least

commitment approach to problem-solving (R-c-l).

The IDEEA know-how modeling tool is particularly useful for domains containing multiple

objects (either physical or conceptual, macro or micro) with known relationships among them.

It is interesting to note the similarity of these types of problems with concurrent engineering tasks

which require many interacting nodes of knowledge. The complexity of these types of problems

results from interr dated interactions among large numbers of objects, rather than from local

relationships between any particular two objects. The constraint language used in IDEEA

provides a uniform representation for both numerical and symbolic knowledge (R-a-l) and,

hence, helps to integrate different engineering expertise. The bi-directional characteristics of

66
Sharing Experience Between Manufacturing and Construction

o0O-1 E E

EXTIEG RDEEET

INDEEDI HDE NERS

AIDEM.~ IDEEA ~' * AIMS

o 5

U(know-why) : (know-how) (know-what)

* I

m

:generic environmicnt :cx tended cnv ironnment

:software techniqueI :indtistrial applications

<>:other prototypes

Figure 7. Various KPT Tools to Suport Concurrent Engineering

67
Arthur Baskin and Stephen C-Y Lu

constraint relationships between known and unknown attributes eliminates the need to pre-specify

input and output parameters in IDEEA-based models (R-a-2). This makes IDEEA suitable for

multi-participant problem solving, where each participant may provide different inputs and seek

different outputs. The interval value specifications provided by IDEEA's composite values

remove the need for users to select a single value in order to use the model. This enables

IDEEA to be used during both early and later stages of decisions where interval and atomic

values are desirable (R-c-1). The explanation facility in IDEEA provides the ability to examine

the constraint networks in either a graphic or text-based manner with multiple levels of

abstraction (R-b-4). This makes the knowledge in the model more understandable by other human

or machine-based knowledge sources (KSs) which may have different perspectives.

6.5 Processing Know-Why Knowledge for Concurrent Engineering

To support concurrent engineering, it is necessary to include several know-how KSs which can

contribute their different expertise to the product being developed. There will be many instances

where these know-how KSs suggest competing ideas during a product development process which

evolves over a period of time. It is necessary to manage those competing suggestions

systematically to maximize the values of differences. A critical issue here is the ability to keep

track of why a particular decision was made by a particular know-how KS at a particular time.

In other words, it is necessary to explicitly model engineers' product development know-why

knowledge on computers. Here, know-why knowledge represents the rationale of decisions made

by know-how KSs, and the history of a decision-making process involving one or several knowhow KSs over a period of time. Processing decision rationale supports better coordination of

competing perspectives provided by multiple participants, while tracing the decision history

facilities explicit management of multiple decision stages.

A design evolution management (DEM) methodology (26) was developed which supports the

acquisition, representation, and utilization of decision rationale and processes (R-b-l). This

methodology was implemented in a prototype system, called AIDEMS (An Interactive Design

Evolution Management System) (see Figure 5). Know-why knowledge is represented and utilized

in AIDEMS at both strategic and tactical levels. Decision strategies are explicitly modeled in

the form of plans whose structures consist of a refinement hierarchy, parallel view-paths for each

refinement, and sequential views within a view-path. View-paths represent the different life-cycle

perspectives considered and views record the incremental, increasingly detailed stages of product

development activity. This representation enables the establishment of a strategic context based

on different perspectives, which is critical to the proper management of later design tactics.

Design tactics are captured as decision procedures whose execution results are represented as

connections. Connections record the interdependent relationships which exist among decisions

made in a product description (R-b-2). These explicitly recorded connections can be used to

explain attributes of a product description and automatically (R-b-4) modify them when changes

in design strategies or tactics occur at the later stages (R-b-3). This is an important feature for

supporting decision making at multiple stages during product development (R-c-4).

6.6 Processing Know-What Knowledge for Concurrent Engineering

When solving complex system problems, such as the concurrent engineering task, engineers are

68
Sharing Experience Between Manufacturing and Construction

often faced with large amounts of information obtained from simulations, experiments, and past

solutions. Given this information, they must construct know-how models which are optimal with

respect to the specific problems at hand. The knowledge required for constructing optimal models

and refining them to enhance performance is called know-what knowledge. This knowledge is

necessary to support the various stages of the decisions, and to cope with the changing

perspectives in concurrent engineering. A new modeling methodology for interactive model

formation and utilization to support know-what knowledge processing was developed (27). The

methodology integrates simulation, learning, and optimization to form an Adaptive and Interactive

Modeling System (AIMS) to support multiple perspectives (R-b-) at different stages (R-c-).

Given a databa,e of examples collected from simulations or experiments (R-d-l), and a set of

modeling objectives and design objectives, AIMS performs multi-objective optimization at both

the model formation and utilization phases. During model formation, layered models with

explicit trade-offs between modeling objectives are induced from the example database. These

models are then used during model utilization to find optimal solutions with explicit trade-offs

between design objectives. By varying modeling objectives, such as speed, accuracy, and

comprehensibility, AIMS can produce layered models to meet the changing needs at different

stages of design (R-c-2). By treating different life-cycle concerns as competing design objectives.

AIMS can support systematic incorporation of multiple perspectives for concurrent engineering.

Furthermore, a layered set of models built by AIMS offers several distinct advantages over

traditional analysis models which can only provide evaluations at very detailed stages of product

development. These advantages include early evaluation to avoid costly iterations (R-c-3), fast

execution for interactive decision making, enhanced comprehensibility for human inspection (Rb-4), and deep roots in domain physics for higher accuracy. AIMS represents an intelligent

integration between Al and traditional engineering methods to form the needed know-what KPT.

6.7 Integration and Application of KPTs for Concurrent Engineering

The above core KPT tools offer a set of desirable functions which have been integrated and

applied to provide concurrent engineering solutions. Some of these application and integration

efforts performed at KBESRL (see Figure 7) are briefly summarized below. It should be noted

that although not all the current applications are in the specific context of product development,

all systems demonstrate some functions required by concurrent engineering. Also, due to the

space limitation, only one reference paper is cited for each system. Those readers who are

interested in more details of these syst,-rns should refer to (19).

TOPS Turning Operation Planning System: a domain specific application system built by IDEEA

for process planning of lathe-turned parts (28). Although not directly used in the concurrent

engineering context, TOPS serves as a critical link for design and manufacturing integration (Ra-I). The system is linked with a solid modeler for design and a relational database for tooling

(R-a-4).

CAPP-EP Computer-aided Process Planning Enabling Platform: IDEEA is used to implement

a set of generic function modules, called the enabling platform, for developing different process

planning systems (29). The system adapts to the current PDES standards (R-a-3), and has links

to CAD tools and databases (R-a-4). In addition to functional supports to CAPP systems, our

CAPP-EP can record plan intents (R-b-1) and maintain consistency for planning activities (R69
Arthur Baskin and Stephen C-Y Lu

b-2).

XROT-IDEEA Manufacturability Advisory System for Rotational Parts: another application of

IDEEA for manufacturability checking of rotational parts during various design stages (30). The

system integrates CADROT, a CAD tool (R-a-4), with an Al based process planning knowledge

base (R-d-1), uses multiple representations (R-a-1), and conforms with PDES/STEP standards (Ra-3). The CAD and CAPP knowledge are implemented on two separate computers, and the

interaction modes between designers and planners can be both local and remote (R-d-4).

CASCADE-T Computer-aided Synthesis and Computer-aided Design of Engineering Tolerances:

an extended IDEEA environment for the domain of tolerance synthesis for mechanical design (Ra-2) (31). Tolerance is an important subject in concurrent engineering, serving as a

communication window between design and manufacturing. The CASCADE-T system can

simultaneously consider function and geometry requirements in designing consistent tolerance

specifications (R-b-2 and R-b-3), and provide domain-dependent explanations (R-b-4) at multiple

levels of abstractions (R-c-2).

INDEED Intelligent and Distributed Environment for Engineering Design: a major extension of

IDEEA which supports remote and local interactions for group design (R-d-3 and R-d-4) (32).

INDEED provides extended capabilities from object-oriented database technology (R-b-2) which

allow consistent and persistent data storage (R-a-4) by multiple engineers. It also support

recording of design rationale (R-b-1), managing conflict situations (R-b-3) and ownerships (Rd-2). It allows hypothetical reasoning by individual engineers in a group design setting (R-c-4).

PRIDE Providing Rationale in Engineering Design: an application of AIDEMS in the domain

of frictional clutch design for transmissions used in heavy vehicles (33). Different design

assumptions and rationale at both strategic and tactical levels during clutch design are captured

in the system (R-b-l).

PRIME Providing Rationale in a Multi-agent Environment: an integrated know-how and knowwhy environment which combines the functions and methods from IDEEA and AIDEMS. It

supports the recording of design histories (R-b- 1) in an interactive mode, helps the management

of design plans, and controls the sharing of design decisions and rationale with other engineers

in the same design group (R-d-2, R-d-4). PRIME is currently being tested in the domain of

transmission design.

MEGA Managing Engineering Group Activities: an integrated know-how and know-why

environment to support team design based on the discourse design model (34). The system

supports adaptive focus with different viewpoints and abstractions (R-R-c-2), recording of

rationale (R-b-l), detecting and resolving conflicts (R-b-3), and integrates with different CAD

tools (R-a-4, and R-d-l). It can be used for synchronous and asynchronous interactions (R-d-3)

with local and remote design teams (R-d-4).

PRO-IDEEA Probabilistically Valued IDEEA Environment: a system that support acquisition,

representation, and manipulation of probabilistically valued attributes (35). It uses objects from

IDEEA for representation (R-a- I), constraints from IDEEA for manipulation (R-c- 1), and machine

70)
Sharing Experience Between Manufacturing and Construction

learning from AIMS for acquisition of probabilistic values to support design and manufacturing

integration. The system supports what-if analysis (R-c-4) and the learning tasks can be

distributed across networked computers (R-d-4).

NEXT-IDEEA Advanced Versions of IDEEA: many major extensions are being developed for

IDEEA to enhance its basic capabilities as a more robust and useful tool for concurrent product

development. These extensions include integration with CAD tool for geometry processing (Ra-4), recording of decision rationale (R-b-1), domain dependent explanations (R-b-4) at multiple

levels of details (R-c-2), hypothetical reasoning (R-c-4), and a blackboard architecture for group

problem solving (R-d-).

CYCLE Classification and Sorting of Recyclable Containers: an application of AIMS for the

control of continuous operations based on on-line sensory information (36). Although not

directly related to concurrent engineering, the system demonstrates the abilities to integrate

sensors with learning algorithms (R-d-1) to produce classification models with varying details (Rc-2), both are required functions for concurrent engineering.

NEURAL Neural Networks for Complex Control: an application of neural network learning

algorithms to open-loop controls of complex mechanical systems (e.g., a combine harvester) (37).

The system is able to integrate various sources of knowledge (R-a-1) about the process and adjust

machine control parameters to adapt to varying operation conditions (R-c-2).

HIDER Hierarchical and Interactive Design Refinement: a domain-independent system which

supports hierarchical refinement of decision spaces through successive optimizations with layered

models induced by AIMS (38). This methodology bridges the synthesis and analysis gaps (R-a-2),

supports decisions with varying abstractions (R-c-2), and facilitates early evaluations of designs

(R-c-3). HIDER is being applied to the domains of concurrent engine design and quality control

of semiconductor production.

META-AIMS Meta Learning System for AIMS: a meta-leaming system which learns how to

optimally control and select various learning algorithms in AIMS with different application

domains (39). Such a system can enhance the performance and operation of AIMS in concurrent

engineering applications.

INVERSE Inverse Engineering Methodology: a machine learning system that can automatically

induce knowledge to support design synthesis from those analytical models of the domain (R-a-2)

(40). The models produced are "invertible" and can be at various levels of details (R-c-2)

including those required for early stages (R-c-3).

KBL Knowledge-Based Learning: an integrated machine learning system that combines the

strengths of inductive and deductive algorithms (r-d-1) for real-world problems which are dataintensive and knowledge-sparse (41). The system can work with various representations of

domain knowledge (R-a-l).

71
Arthur Baskin and Stephen C-Y Lu

7. Summary and Conclusion

In this paper, concurrent engineering was defined as a system approach to cooperative team work

in product development. The technological challenges of concurrent engineering were explained

by comparing product development costs at different stages and examining the impact of

engineering changes. Using a system perspective of concurrent engineering the research and

development needs were presented. Based on these challenges, a set of functional requirements

of concurrent engineering computer tools were identified. These requirements were explained

with respect to their roles in integration of complementary engineering expertise, cooperation of

multiple competing perspectives, coimmunication of upstream and downstream concerns, and

coordination of group problem-solving activities. The knowledge processing technology was

defined and introduced as a foundation for developing intelligent software that can meet these

requirements. Some recent results of various KPT tools to support concurrent engineering were

briefly reported.

As noted in this paper, concurrent engineering is a complex system problem which requires

technological, organizational, and, perhaps, cultural solutions. Although computers are not the

final solution, they certainly play a very critical role in the realization of concurrent engineering.

Developing intelligent computer tools for concurrent engineering tasks can not only help our

product development practice but also result in new software paradigms which are more suitable

for integration of complex system problems, meeting one of the most challenging tasks in

engineering automation.

Acknowledgments

The authors acknowledges Allied-Signal Aerospace Company, Caterpillar Inc., Computer-Aided

Manufacturing International, Digital Equipment Corporation, Ford Motor Company, Illinois Solid

Waste Research Offi..e, National Science Foundation, U.S. Army Construction Engineering

Research Laboratory, and Xerox Corporation for their support to his Know ledge-Based

Engineering Systems Research Laboratory (KBESRL) to conduct knowledge processing research

in the domain of concurrent engineering. Fie is also grateful to KBESRL research staff whose

hard work has contributed to making the knowledge processing idea more than just a philosophy.

Specific thanks to Case (MEGA), Doi 'XROT-IDEEA), Hall (NEURAL), Herman (IDEEA,

TOPS, NEXT-IDEEA), Lucenti (C '), Mattox (INDEED), Rao (INVERSE), Sch%%arz

(PRO-IDEEA), Tanquary (PRIDE, Ilk, Tarbell (CYCLE), Tcheng (AIMS, META-AIMS),

Thompson (AIDEMS , Whitehall (KBL), Wilhelm (CASCADE-T), and Yerrarnareddy (HIDER).

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76
ADVANCING INNOVATION IN TRANSPORTATION THROUGH RESEARCH

C. Michael Walton

Paul D. and Betty Robertson Meek Centennial Professor

Chairman of the Department of Civil Engineering

The University of Texas at Austin

Perhaps at no other time in our history as a nation, and industry, or a

profession, has the outlook been so bright for those interested in advancing

transportation technology and innovative practice. It is little short of amazing

that there is such a consensus and so little opposition to the large expenditures

for research that are now being contemplated for materials, methods, IVHS,

transit, and various University research programs in transportation.

To put this phenomenon in perspective we should consider the factors

influencing the changing U. S. transportation environment:

"* Regulatory Reform

"* Federal Budget Deficit

"* Globalization of the Market Place

"* Changing roles of Federal/State/Local Government

"* Environmental Concerns

"* Tort Liability and Insurance costs

"* Demand for Efficiency and Productivity

"* Private Sector Involvement

These factors helped to focus on the identification of critical issues

confronting the transportation environment. These critical issues are:

"* Economic Competitiveness & Productivity

"* Congestion

"* New Investment

"* Maintenance

"* Environmental Protection

* Energy

* Intergovernmental and Public-Private cooperation

* Safety

* Human Resources

From this list of critical issues a number of projects and programs have

been structured to assist in evolving an effective agenda for the Transportation

Research Board and the Transportation Community.

In our euphoria over this increased interest, we must begin to consider

that our increased visibility will also increase the need for producing results

and insuring that the various research initiatives are properly coordinated. One

of the reasons that research is currently favored, is because of the strong

impression that the strategic highway research program (SHRP) activity has been

successfully organized, managed, and carried out, without significant questions

about its objectivity and fairness to all concerned.

77
But SHRP's success further underscores the absolute necessity for us to

organize these new research efforts effectively, and work hard to insure

coordination of the various pieces. I am happy to be able to report that TRB has

established the new high level-what we've called the Tier One Group-Research and

Technology Coordinating Committee (RTCC). The committee is now appointed and has

had its first meeting. AASHTO and the States have been rather insistent that the

new build-up in the Highway Research Program should be accompanied by the

establishment of a high level Oversight Group, which can review the entire

federal effort in Highway Research including SHRP, IVHS, Turner Fairbanks, HPR,

NCHRP, and the University Research Program , to insure that the program remains

on target: is responsive to real needs; is clear of duplication of effort, is

coordinated with related research efforts technology, and doesn't develop gaps.

Dr. Norman Abramson, former Executive vice President of the Southwest Research

Institute, a member of the National Academy of Engineering, and a person with an

outstanding record ir organizing and managing large research efforts has agreed

to be the chairman of this panel. Dr. Ray Chamberlain, Executive Director of the

Colorado Department of Transportation, has agreed to be the Vice Chairman. The

Committee has members from the private sector, Academia, and State and Local

Government.

I wish I could tell you exactly how this group is going to function. Our

nearest model is the Strategic Transportation research Study (STRS) Committee,

which did the STRS report that in turn recommended SHRP. This group also looked

at our overall highway research programs and compared them to how we were

spending our research funds. In some respects the new research and technology

coordinating committee will be in effect, a continuing STRS. Tom Larson and

Charlie Miller of FHWA are providing adequate funding for this committee to do

more than just react to their proposals; it is expected that the panel will be

proactive and will make recommendations of its own. But all of us recognize that

we've experimental mode. All are committed to making it work however, and I'm

optimistic that it will. It must if we are to keep this large decentralized

research effort on track as we move ahead towards the year 2000.

I'm happy to report that progress is also being made in organizing for

Post-SHRP Activities. SHRP is scheduled to terminate in June 1993, but that the

long term pavement project-LTPP-is scheduled to transfer from SHRP to FHWA in

June 1993. But because of the big role that States are playing in LTPP, it is

important that we organize so that the States can have a major voice in how LTPP

is run over the next 15 years. Unusual efforts are being made to insure that

this transfer of activities from SHRP to FHWA is seamless--that is, that there

is no disruption to this vital experiment. This requires that provisions be made

for many of the staff to transfer to other agencies, and that responsibilities

be moved in an organized and planned way. Agreement has been reached between all

parties on how this is to be done. In addition, a smart panel (smarts stands for

SHRP Monitoring and Research Transfer Committee) will be established within the

TRB beginning next Spring with its own staff and a schedule of activities and

responsibilities, which will grow until June 1993, when it will assume full

responsibility as SHRP Terminates. Initially the panel will begin work by

assisting SHRP in planning for implementation activities, and providing review

and critique of the LTPP program with recommendations to the FHWA and AASHTO.

By June 1993, it will take over any residual SHRP activities that remain undone.

The smart panel will look much like the state people augmented with some industry

and academic experts. Again, Tom Larson and Charlie Miller have been implacable

in their insistence that this activity move ahead in a timely fashion. TRB is
currently in contract negotiations with FHWA to obtain the funds to begin this

work.

LTPP is an enormous effort devoted to an enormous cause. Because the whole

world spends countless billions on pavements every year, and because this amount

continues to increase annually, our need to know more about how pavements perform

is self evident. On the other hand, because we operate in such a decentralized

fashion, suffer such turnover in our leadership, and are subject to such jolts

in our funding patterns, the difficulties of sustaining this effort over the 20

year required period is formidable. The first five years have been devoted to

getting the effort organized and beginning data collection. During the next five

years, we will begin to see some major new findings as serious analysis of these

data begin. Some of the results may jolt previous notions of some very

controversial issues about pavement materials, the effects of environment versus

loadings, and the relative effects of heavy versus light loads. It is essential

that we be organized so that appropriate unbiased assessments of these findings

can be made on a timely basis. It's also interesting to note that the data base

will have cost us about 250 million dollars as we approach the 20th year of data

collection. It will be an asset requiring serious management efforts. The smart

panel should give us the ability to handle all these matters, and we're proud

that you have seen fit to allow TRB to serve in this way.

Now let me shift to the subject of Transit Research. There is growing

interest in the U. S. in transit. The States as a group have been spending more

money towards transit assistance than the Federal Government for several years

now. It's also clear that in many areas of the country, we are going to be

seeing more money spent on transit than we have in the past, considering concerns

about mobility, air quality and energy conservation. The problem is that we may

not know how to use the additional monies very effectively. Whether we are

talking about maintenance of deteriorating transit infrastructure, or studying

new service delivery methods, we have spent little to learn how to improve

Transit effectively in recent years. If there is an area in transportation where

research has been neglected over the past decade it is Public Transit.

Fortunately, Former Secretary Skinner and Bryan Clymer, FTA Administrator,

are committed to developing an effective Transit Research Program, and are using

TRB Special report 213-The Transit STRS Report completed in 1988, as the

guidebook for this revitalization. The TRB report argues that one of the most

pressing transit research, the Transit operators, and further argues that the way

to meet this need is to model a transit research program after the National

Cooperative Highway Research Program (NCHRP). Thus, the Transit Cooperative

Research Program (TCRP) is being organized, as authorized by the ISTEA

Legislation, and TRB is being asked to play a role similar to its role in NCHRP.

The American Public Project Selection Committee. TCRP will be funded at about

$12M annually, which makes it about the same size as current projections for the

NCHRP. The existence of these two programs side-by-side in TRB, with responsive

links to the using industries, provides some brand new opportunities for the

carrying out of multimodal studies that would have been impossible in the past.

With the tremendous problems we are having in planning and implementing urban

transportation strategies that effectively deal with air quality, energy concerns

and mobility, this joint research resource should, if effectively used, provide

a real opportunity to advance our knowledge in this whole field. We must learn

how to take advantage of these new resources and use them in effective ways.

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For all this new Research Activity, there is one area that remains

essentially neglected, and I now refer to our inability, as yet, to effectively

engage the private sector in research and innovation. Whenever we talk about

research, we usually at some point acknowledge that we must get the private

sector more heavily involved if we are to really effect innovation. And we have

made some progress. IVHS America is having success in developing a public -

private partnership to develop and deploy IVHS technology. Our asphalt

contractors have progressed in sponsoring European study tours, setting up a

national center for asphalt technology, developing a text book, and jointly

sponsoring a TRB prepared hot-mix asphalt handbook, which is being jointly

endorsed by AASHTO, FHWA, FAA, U. S. Corps of Engineers, National Asphalt

Pavement Institute, American Public Works Association and the National

Association of County Engineers. But much remains to be done.

TRB set-up a task force two years ago to work on innovative contracting

methods, looking for ways to contract for roads other than the "Low First-Cost

Bid" method. This group included people from both the public and private sector

and is about to release their report, which advocates large scale experimentation

with a variety of contracting instruments, all of which are designed to require

the contractor to be responsible from the performance of some or all aspects of

the performance for :he road- and not just to follow the owner's recipe for the

materials and methods. FHWA is much interested in funding demonstrations to see

whether this is possible aad what contracting instruments work well in our

cultural and legal environment.

But there are much greater issues where we can engage the private sector

if we can but identify them and find ways to move ahead. Another TRB task force

under the chairmanship of John Gray, NAPA, has been working for about a year on

some of these other issues. While it's too early to know where they will end up,

they are examining ways to develop product testing centers, way of funding

private sector sponsored research, and ways of conducting joint training. One

result of this task force, is that TRB will hold a major seminar during CONEXPO

at Las Vegas in March 1993, displaying SHRP products that the privatp sector

should know about. One may be critical of public sector activities at Las Vegas,

but more than 100,000 private sector contractors will be there, and if we want

to communicate with them, then we must go where they are. This meeting may also

be an opportunity for some public sector types to see the greatest collection of

high-tech construction and maintenance equipment that can be found anywhere,

while attending a TRB meeting.

During my tenure as chairman of TRB, I have had the opportunity to preside

over the development of the first TRB Strategic Plan. Some of the items I have

discussed are part of that plan, but there is much more, including a stronger

international outreach-something that we must all do as part of the research

build-up, since a lot of the technology T need exists in other countries.

In Conclusion, let me list the points I believe make a difference in

promoting opportunities for innovation in public works Infrastructure:

"* Leveraging Advanced Technology

"* Multidisciplinary Teaming

"* Public-Private or government-Industry (&Academia) Partnering

"* International Networking

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* Creative Engineering Degree Programs

* Influencing Change in Institutional Arrangements

* Promote Risk Taking or Those who Embrace Risk

* Commitment to Productivity

* Leadership at all Levels

Thank you
Technological Advances and Public Works:

A Synergistic or Antagonistic Relationship

Neil M. Hawkins, Professor and Head

Department of Civil Engineering

University of Illinois at Urbana-Champaign

ABSTRACT

Barriers to the use of public works as a vehicle for making technical advances are

discussed with particular emphasis on identification of the policy issues that must be

addressed in order to make such implementation a synergistic rather than an antagonistic

relationship. The political process systematically introduces societal factors into the

formulation of policies for the creation of public works. But as more people and

organizations become involved in translating those policies into realities the issues that must

be addressed become increasingly technical and recognition of the importance of societal

factors in the process diminishes. Societal considerations are supplanted by permitting

processes with gatekeepers, and prescriptive codes and standards with rigid interpreters.

Ostensibly the aim of those gatekeepers and interpreters is to achieve a quality product but

in actuality the result is a stifling of innovation and the creation of adversarial relationships.

Continued commitment to societal rather than individual goals, with the gatekeepers and

interpreters converted to leaders, is essential to the nurturing of innovation in public works.

The need for government, private industry, and academia partnerships for the development

of an effective construction technology advancement program is demonstrated by comparing

similar construction technology advancement programs in Japan and the U.S.A.

INTRODUCTION

The ability to utilize public works as a vehicle for making technological advances is

closely linked to both the policy makers', and the experts', experience with such a process.

Such experience is almost totally lacking in the public works sector in this country.

Contracting and permitting practices, ostensibly established in the public's best interests to

hold down costs and insure a quality product, mitigate against technological advances during

public works. Existing processes frequently penalize innovation and create adversarial

relationships. By contrast, in the public works sector in Japan, and for military procurement

purposes in this country, there has long been a practice of successfully using key projects as

a vehicle for technological advances. Not every project is used in this manner. Usually only "visionary" or high risk projects are used and even then the extent of innovation attempted

and who pays for the cost of that attempt, varies from project to project through mutual

agreement of all parti2ipating parties.

This paper stresses the need for public policy visions to orchestrate our actions.

Societal, technological and administrative considerations resulting from examination of that

vision should guide the type of research that is conducted, the technology for which proof

of concept is sought, the public policies that are implemented. To illustrate the views

expressed in this paper, Japanese government policies used to guide the practices of the

83
Ministry of International Trade and Industry (MITI) and the Ministry of Construction

(MOC) are examined. Two case histories of MOC practices are presented, one for

development of an automated compaction measuring robot, and the other for precast

concrete seismic structural systems (PRESSS). The Japanese policy practices for PRESSS

are contrasted directly with the US policy practices for the coordinated US PRESSS

program. The expected differences in outcomes are highlighted in order to suggest the

changes in US attitudes and practices needed to develop a synergistic relationship between

public works programs and construction technology advances.

To achieve technical innovations risks must be taken and the basic issues are who

should pay if the innovation is not successful and who should benefit if the innovation is

successful. A synergistic relationship for public works activities and innovation requires a

commitment to the innovation vision and process, and not to their own self interests, by all

who are part of the process or stand to benefit from that process: government, academia,

consultants, contractors and society.

THE CIVIL ENGINEERING PROCESS

Technology advances are essential to economic growth and current thinking ties

growth primarily to manufacturing output. Yet, effective and efficient constructed facilities

are essential for quality manufacturing and are, in essence, the foundation on which the

technology of our society is built. The importance of the quality and efficiency of

constructed facilities is clearly illustrated by their loss as a result of a natural disaster. That

loss disrupts society and requires an expensive emergency response. The quality and

efficiency of such facilities affects directly the way society does its business and consequently

that quality and efficiency contributes directly to society's long term well being.

The achievement of technological advances requires simultaneous investment in both

research and development (R&D) activities and in education, and success stimulates

increased investments in R&D activities and education. Thus, the involvement of higher

education professionals in technology advancement activities is essential to the achievement

of such advances. However, in the short term, technological advances are more dependent

on proof of the technological concept and its implementation in a few key cases in practice

than on a healthy basic research program. In science improvements come primarily from

breakthroughs, but for technology improvements are usually incremental with as much

knowledge often gained from field failures as from field successes. The systematic

collection, analysis, and interpretation of the consequences of attempting to implement

technological advances is fundamental to the development of both successful technological

advances and to the development of relevant public policies that facilitate technological

advances.

Shown in Fig. 1 is an idealization of the civil engineering process for a typical public

works project. The project starts with a societal need which in itself must be clearly

identified. Certain public works concepts that are responsive to that society need are then

suggested by public authorities. From that stage onwards the public policy issues diminish

in significance and the technical issues, along with administrative (permitting) and budgetary

issues, increase in significance. Predictably any technical constraints are dictated by the

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limits of existing technologies and those limits can be changes only by developing a new

technology. Conceivably, that is possible if there is a reservoir of basic research that can

be tapped to develop that new technology and thus alter the original concept, within the

time period when the concept is translated into actual design documents. Clearly, the most

effective concept improvements and the greatest cost savings are reaped from technical

advances when those advances, as indicated by route A in Fig. 1, are made an integral part

of the initial design concept. The judgement of the effectiveness of those advances should

not be made solely in terms of their impact on the initial concept but in terms of their

impact on the totality of the civil engineering process which should include not only design

and construction considerations but also operation, maintenance and repair considerations.

Further the evaluation should not be made simply in terms of budgetary considerations but

also in terms of the degree to which the societal need has been satisfied and the technology

of society advanced.

From Fig. 1 it is apparent that while introductioo, of a gatekeeper operation between

the design and construction phases may be able to hold down costs is also effectively

prohibits technology development, if as illustrated by route B, that technology development

requires certain actions during construction that no bidder on the project is qualified to

perform. Further the same can be said for other gatekeeper operations introduced between

the construction, operation, etc., phases of the project if certain technology development

practices, as illustrated by route C, are essential to the success of that operation. The

extreme fragmentation of processes in the construction industry, as currently exists in the

U.S.A., in general lowers initial costs and develops firms with great depths of knowledge in

a given specialty. However, society is also paying an additional long term price for those

short term gains. The process stifles technological advances which society must pay for

separately if it is to maintain a technologically competitive construction industry. The long

term price to society is least if the industrial participants have operations vertically

integrated throughout the whole cycle of Fig. 1 since that participant can then reap the

greatest benefits from any investments made in basic research and technology development.

THE IMPACT OF SOCIETAL ENVIRONMENT ON TECHNOLOGICAL CHANGE

The problems of today are often the result of yesterday's solutions. One obvious

example is the need to develop new technologies to clean up the hazardous wastes created

by the development of the nation's nuclear arsenal. Unless society attempts continuously

to improve its economic well-being through the creation of new wealth it can do little to

correct the problems caused by yesterday's solutions.

Shown in Table 1 is a simplistic listing of determinants of a nation's economic wellbeing(l). In the old system, land mass and its associated natural resources, population size,

military prowess, and availabi • capital were considered the determinants. By contrast, for

the current global economy the determinants seem to have become the society's level of

technology, the skills of its population, the capital investment choices it has made and is

willing to make, the stability of its political environment and the societal infrastructure. The

latter is best described as the way society gets its business done socially and physically.

Obviously the civil works inafrastructure of the nation is a major determinant of economic

85
well being in the new system.

Technological innovation is a key factor in wealth creation and therefore the

establishment of policies that successfully encourage technological innovation should be the

aim of government. The factors that drive technological innovation are many and complex

and include, in addition to technical factors: economic and financial; political and legal; and

cultural, educational and societal factors. The incentive to invest in a different construction

procedure depends on the cost of resources and the probability of return. Public policies

strongly influence both those factors. Technological change brings with it uncertainty and

investors in changes which are deemed to be in the public interest must have an opportunity

to profit from them if there is to be wealth creation.

The cultural, educational and social foundations oT a nation are intangible assets that

can be catalyzed by industry or government to either spur or retard technological innovation.

In Japan, the government's technology innovation process for all ministries is built on that

premise. As shown in Fig. 2 the Ministry of International Trade and Industry (MITI)

assumes for its technology development policy that there is a cyclical relationship between

external factors, internal factors, and technological innovation(2),(4). When appropriate

external circumstances threaten the community, then as shown in Fig. 3, the proper policy

systems can make that relationship self-fermenting.

In Fig. 2, the external factors include the social and cultural environment, the

economic environment, and the physical and natural environment, (which to the Japanese

way of thinking includes energy). Internal factors refer to the R&D environment within a

given company with the government providing qualitative input through its judgment of

whether the company has met certain technological qualification standards, and the company

providing quantitative input by means of their R&D expenditures and the technologies they

import. With that input the proper machinery, (the government's R&D policy systems), can

generate significant output that can be measured in terms of the improvement in the

technological level, patents, etc. That improvement in the technological level then changes

the external environment, and the cycle continues.

In Fig. 3 the same process is represented differently with the external factors

decompossed into two parts, a social and cultural foundation, and an economic environment.

The factors considered important in the foundation are: the level of education and diligence

of the workers; and the systems and customs of society and management. The economic

environment includes the severity of competition in the private sector, in terms of the quality

demands of the consumer, the extent of interactions between different industries, and the

relation between investments in R&D and structural changes within the industry.

It is MITI's experience that appropriate government policies and administrative

measures, combined with relatively small governmental financial investments, can spur major

R&D efforts and technology innovation by industry in response to a clearly identifiable

social need or society threat. Typical government policies are the selection of goals through

the development of white papers that define the critical technologies on which efforts should

be concentrated, clarification of the appropriate building blocks for those technologies

86
through the formulation of visions utilizing those technologies, and the implementation of

a series of administrative measures that stimulate R&D activities in the directions indicated

by those visions. The administrative measures include governmental guidance in the form

of laws, regulations, tax incentives, etc.; coordination among the different planning divisions

of the Ministry of the activities associated with that vision; and the development of specific

programs to stimulate the diffusion of knowledge to all working on the vision. Success of

the policy measures requires close cooperation with, and consistency with other government

agency industry related policies; a flexible approach to organizing R&D activities; catalytic

use of governmental, including academic, research laboratories; and the establishment of

partnership activities between industry, academia, and government.

For the model of Fig. 3 there are two elements that have little significance for the

current Japanese economic environment but strong influences in the current U.S. economic

environment. Those elements are shown in boxes in the economic environment box of Fig.

3 and are liability costs, and capital investment incentives expressed as the cost of capital

and the probability of return.

In Japan, the Ministry of Construction u.;es the model of Fig. 3 to provide leadership

for technology innovation in construction by coupling innovation and regulatory policy, thus

reducing the liability of the contractor authorized to use an innovative technology. By

contrast, the current U.S. situation discourages innovation. Liability is a major consideration

and the regulatory requirement common in public works of mandatory acceptance of the

lowest responsible bid has lead to increasing separation of the design and construction

processes on both public and private works, and, often, the preordaining for public works

of a confrontational relationship betweei, contractor and owner.

THE IMPORTANCE OF INVOLVING THE CONTRACTOR

The organization of a society, and particularly the role of the major contractors in

that society, affects strongly the transfer of research into practice for constructed facilities.

The major current concerns of the construction industry, in the U.S., Japan, and Europe are

the same: the increasing age of skilled workers in construction, compared to workers in

others industries; and a stagnant or decreasing productivity per worker. Construction is

dirty, difficult and dangerous. The construction industry could benefit markedly from

advances in robotics; in aesthetically acceptable automation-oriented structural and cladding

systems; and in computer integrated procedures.

The profiles of the construction industry in Japan and the U.S. are very similar with

the six largest firms in both countries handling about 10 percent of the total market, and the

top 0.3 percent of the total number of contractors holding about 35 percent of the total

market. Yet in Japan the six largest contractors spend an average of 1 percent of sales,

about 60 percent of their net profits, on R&D. The six largest U.S. contractors spend only

about 0.04 percent of sales on R&D. The amount spent on construction R&D in Japan by

contractors is more thar double that spent by their government. The amount spent on

construction R&D in the U.S.A. by contractors is about one seventh of that spent by the

government. Lack of capital and appropriate human resources, competing business

87
priorities, conflicting government policies, a lack of incentives and particularly liability

issues, are major factors causing this low level of R&D expenditures in the U.S.A. The

amount U.S. contractors spend on liability is a magnitude greater than the amount they

spend on R&D, and they confine their R&D activities to actions that do not increase their

liability exposure.

For the large Japanese contractor investment in R&D is necessary for three reasons:

(1) for the firm to be judged socially responsible, otherwise it cannot survive financially; (2)

for design-build activities, since major clients choose contractors, and the government prequalifies contractors for public works, based on demonstrated expertise in new technologies;

and (3) for improvements in job site activities. Essentially for U.S. firms only the last

incentive exists currently.

The introduction of new technologies into construction practice in Japan is very

difficult with the government using that difficulty to spur R&D expenditures. The situation

is equivalent to a U.S. Government Department, such as Labor or Commerce, controlling

what appears in the Uniform Building Code (UBC)(3); delaying revisions to UBC until the

technology has been widely proven for some time in practice; selecting contractors for public

works based on their level of technological achievement; and routinely requiring extensive

laboratory and field tests, and participation in collaborative research activities with other

contractors of similar technological achievement, if they wish to introduce a new technology.

In Japan before a new technology can be used in practice, a recommendation for approval

must be received from an independent technical committee that oversees that testing. The

Japanese government uses essentially the same process, catalyzed by varying degrees of

government financial and technical assistance, to foster the development of desirable new

construction technologies. The research is planned and executed so that there is a direct

transfer of the technology into construction practice, with participating industry partners

being assured of one of more government construction projects that use that technology as

part of the reward for their participation.

The Japanese Ministry of Construction (MOC) uses MITI's vision system, combined

with a complex new technology approval system, to steer construction research in directions

it desires while simultaneously accomplishing technology transfer. The approval system for

introducing new technologies into public works projects is illustrated in Fig. 4 and an

example of its use for the development of a compaction measuring robot by Mitsui

Construction Company in shown in Table 2.

In 1983 the MOC established a goal of developing measures to increase both

construction productivity and quality. Its vision for such increases involved the use of

electronics based automated systems. The MOC issued a request for proposals, step 1 of

Fig. 4, for such systems. To evaluate the resulting proposals, step 3 of Fig. 4, the MOC had

the Public Works Research Center (PWRC) form a proposal Evaluation Committee. The

PWRC is a neutral professional organization which in the U.S. would be analogous to the

American Society of Civil Engineers (ASCE). Evaluation committees have an almost equal

balance of academics and industry professionals and both must have appropriate experience

in the area of the submission. In the example, the private enterprise, (Mitsui Construction),

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proposed that it develop a soil compaction measuring robot. In its application Mitsui

identified the technology advances needed for the robot's development and the solutions it

proposed to achieve those advances. In 1984 the PWRC Evaluation Committee

recommended to the MOC, step 4, limited approval of Mitsui proposal. The PWRC

committee identified specifically the solutions for which it recommended research funding.

The Public Works Research Institute, located in Tsukuba, contains the principal

laboratories, and public works researchers, of the MOC. Within that Institute the MOC

formed an Examination committee for the Mitsui project. Typically some MOC researchers

are members of both the Evaluation and Examination committees. The MOC Examination

Committee agreed that research support was appropriate for four study areas: travel control;

position identification; measurement of the degree of compaction; and communication and

display. The Examination Committee conveyed its findings, step 5, to the PWRC asking it

to form a Project Evaluation Committee and inform Mitsui that it would provide funding

for the project stages of step 5 in Table 2. The MOC and Mitsui then signed a research

agreement and Mitsui, and its sub-contractors, commenced work.

The features and function of the robot developed by Mitsui are summarized in Table

3. By 1987 Mitsui had satisfied all the concerns of the PWRC Evaluation Committee with

regard to the reliability and specified features of the robot and therefore that Committee

forwarded a final examination report recommending approval of use of the robot to MOC.

Before issuing a certificate for use of a new technology the MOC must demonstrate publicly

the reliability of that system. Typically that demonstration is through the letting to the

applicant of a contract for a specific job using that system. In 1988 MOC let a contract to

Mitsui for a public works project during which Mitsui demonstrated that the robot had

features satisfying the initial objectives of the project. The MOC then issued a certificate,

step 11 of Fig. 4, for use of the robot.

The construction research community has three major constituencies: private industry,

including both contractors and consultants; government; and academia. The Japanese

experience suggests that technology advancement works best, and the benefits to society are

greatest, when all three constituencies are active contributors to an R&D program with

specific objectives. When the three major constituencies work alone, private industry does

research for profit and therefore their research activities become minimal. The government

bifurcates with the legislative arm trying to exercise leadership by passing laws, and the

executive arm, typified in the U.S.A. by the National Institute of Standards and Technology

(NIST), conducting research to protect the safety of the public and prove the societal value

of the new technology. The government products become dictums and reports. Academia

retreats to its ivory tower and does research in a search for truth with their findings

eventually published in papers. The feedback to academia from practice is minimal and the

potential for using academia's idealism to improve the level of technology is seriously

impeded. All three constituencies of the Japanese construction community participate in

joint technology advancement research activities. The advancement achieved by that team

effort is considerably more than that resulting from each constituency acting alone. The

Japanese contractor is a partner in such efforts because: 1) partnering is necessary for prequalification on government jobs, such as the Kansai airport; 2) the public then judges them

socially responsible and the private sector provides them with the more profitable design89
build jobs; and 3) participation reduces their liability in using that technology. Because of

partnerships, government agencies frequently have contractor employees assisting in their

institutes, such as the PWRI. The government agencies role in the partnership then

becomes threefold: 1) to decide fundamental research policies including the subjects that

should be addressed; 2) the degree of assistance, financial and technical to be provided from

government sources; and 3) the administrative guidance appropriate for insuring public

safety in the transfer of research into practice. Through this leadership the government's

strategic planning and program quality management abilities are enhanced. Academia's role

in the partnership is twofold: 1) the undertaking of the basic research needed to achieve the

partnership's objective; and 2) participation in, and also leadership of, the technical

committees steering the research and appraising its quality for government approval. Thus,

academia obtains real life experience relevant to its understanding of the construction and

management of a process from its conceptual planning through design, execution and

maintenance. The result is more effective, and more society and construction community

relevant, education ;t universities.

A COMPARISON OF JAPANESE AND U.S. CONSTRUCTION

TECHNOLOGY ADVANCEMENT MEASURES

The effectiveness and efficiency of the Japanese partnering process for the transfer

of R&D into practice, compared with the situation in the U.S.A., can be demonstrated by

a comparison of the advances in the two nations resulting from 12 years of cooperative

research into the seismic resistance of buildings. In 1978, as part of the U.S.-Japan

government program on natural resources (UJNR), collaborative research was initiated on

the large scale testing of buildings. The program is funded on the Japanese side by the

MOC. On the U.S. side funding is provided by the National Science Foundation (NSF) and

administrative oversight is by NIST. Originally this program was a joint activity with subassemblage testing and analysis performed both in the U.S. and Japan, and five story large

scale structures tested at the Building Research Institute (BRI) in Japan. The first two

programs were on reinforced concrete and steel buildings. After evaluating the return on

its investment for those first two projects, and particularly the degree to which results were

implemented in practice, the U.S. government concluded that the benefits to the U.S.A. of

this joint program were inadequate and subsequent work on masonry and precast concrete

structures has involved collaborative, parallel programs, rather than joint programs.

However, the difficulty lies not in the basic research content of the U.S. work, since the

Japanese continue to look to the U.S. side for technical innovation even in the parallel

programs, but in who is in the research partnership on the two sides. The results show that

participation of contractors is essential for the rapid transfer of any technology developed

into practice.

Case History - U.S.-Japan Program on

Precast Structural Seismic Systems

The UJNR project on precast/prestressed concrete seismic structural systems was

initiated in Fall 1990. Figure 5 summarizes the parallel Japanese and U.S. plans, including

the reasons reported by each side for undertaking the research, the immediate objectives

90
of each side, the time for completion and the cash funding. The U.S. plan is only the first

phase of a multi-phase program. It involves more basic work than the Japanese plan, has

as an objective a major increment in technology, and after three years and a cash

expenditure of about 45 percent of that of the Japanese side, anticipates having as a product

a plan recommending an extensive test program to validate the technology concepts it has

developed. By contrast, the Japanese plan is technology transfer oriented from objectives

through to report recipient. After four years and a cash expenditure by the Japanese

government of only about 40 percent more than that of the U.S. government the Japanese

will have an incremental advance in technology in place that is widely accepted, and

probably that advance in technology will foster increased construction productivity.

The financing and management of Japan PRESSS is shown in detail in Fig. 6. The

Japanese plan involves almost equal partnering and effort by government, contractors, and

others. The "vision" for the project is MOC's 1988-92 emphasis on increased construction

productivity and automation of which Japan PRESSS is part. Challenge funding is provided

by MOC with the Building Research Institute (BRI), the equivalent for buildings of the

PWRI, contributing effort to the basic research and management of the project. The

academy group, (academia), performs basic research using the general project funding and

participates in, and provides leadership to, the technical coordinating committee and the

research promotion panel, organized by a neutral agency, the Building Center of Japan

(BCJ), the equivalent for buildings of the PWRC. A total of 35 contractors with engineering

organizations, and most with their own R&D laboratories, have joined the effort. For that

privilege they each provide Y1 million per year to the Building Contractors Society of Japan,

which retains Y5 million per year and contributes the rest to the project. In addition the

contractors have formed groups to test specific details that will meet the generic conditions

established by the technical coordinating committee. Representatives from each contractor

group participate in the two working groups. The precast concrete industry, PCa, as in the

U.S.A., is independent of the engineering contractors and is contributing independently to

the Japanese activities. They also participate in the working groups and in test activities.

The structural consultants, JCSA, are making trial design consistent with the working groups'

recommendations, and their contributions are in-kind efforts only.

The outcome of the Japanese plan is that there will be, by 1993, MOC approved

manuals for use by consultants and engineering contractors that should insure adequate

earthquake resistance for precast concrete structures. Designs conforming to those manuals

and using one of the certified systems of the 35 contractors contributing to the program will

be automatically approved for construction by every city and prefecture in Japan.

Contractors who have not participated in this program will not be able to gain approval to

erect systems satisfying the guidelines in those manuals until they have done equivalent

testing for their own systems or those design guidelines have been incorporated into

standards. Such standards are revised only after a delay of several years.

For contrast the Phase I situation in the U.S.A. is shown in Fig. 7. The U.S. project

has five sub-projects, one with a structural consultant and four with universities. Funding

is provided primarily by NSF, with limited contributions by the Precast Concrete Institute,

PCI, (which represents precast concrete suppliers), the Precast Manufacturers Association

91
of California (PMAC), and varying degrees of in-kind contributions. The project is managed

by an Executive Committee consisting of two professors and a consultant. There is advisory

input from a Research Panel and an Industry Panel. However, the funding does not permit

face to face meetings of those panels. The cash contribution of the precast concrete

manufacturers to the project in the U.S.A., relative to the government contribution, is about

the same as that in Japan. However, in the U.S. plan there is no active contribution by

engineering contractors except in an advisory panel and the structural consultant work is

primarily the contribution of one firm. There is no assurance that the results will be

acceptable to the American Concrete Institute (ACI), the Structural Engineers Association

(SEA), or the International Conference of Building Officials (ICBO), committees that must

endorse those findings before they can be accepted into model building codes. Further,

even if those results were acceptable there has been little input by which to judge if

contractors would find designs in accordance with those results cost-effective to build.

Certainly contractors are less likely to take the risk of being the first to use such systems

than in Japan, and owners are less likely to want to have their facility constructed from such "unproven" systems.

Participatory cooperation of all sectors of the construction community is necessary

for effective research and for its transfer into practice. Participatory cooperation means

allocation of funding, personnel and time to the research and its implementation.

Participatory cooperation creates a sense of community. It confers on its members an

identity, a sense of belonging, a measure of security, and is the ground-level generator of

value systems and new skills. Cooperative work on a significant new task strengthens the

sense of community, builds commitment, and gives meaning to an individual's life.

Participatory cooperation of all sectors of the construction community in research is needed

for effective public policies for construction technology advancement.

CONCLUSIONS

If this nation is to develop a dynamic construction technology advancement program

greater cooperation is needed between three major construction industry constituencies:

government, contractors, and academia.

Greater leadership is needed from all levels of government, federal, state and local, in

support of R&D activities for construction. Greater leadership requires the formulation and

articulation of constructed facility visions consistent with government's societal goals;

identification of the technologies whose development is needed to achieve those visions;

development of incentives to reward R&D investments by the private sector in those

technologies; fostering of participatory, rather than adversarial, relations between

government, academia, and industry; and a willingness to use construction projects for proof

of concept demonstrations of new technologies.

Much greater contractor participation is needed in the selection and conduct of R&D

activities and in partnering the transfer of outcomes into practice. Such participation

requires communication as well as commitment by all constituencies; hardware and human

resource involvements as well as a willingness to permit flexibility in their use; a

92
compensation structure that not only rewards contractor participation but also rewards

annual increments in contractor commitments; and a research and technology transfer

structure that minimizes legal and economic risks for the contractor.

Academia needs to provide greater leadership in the process of achieving consensus

on the research directions required for developing new technologies appropriate for the

construction, or reconstruction, of facilities. Academia needs also to participate more in

construction industry proof of concept and technology transfer activities.

REFERENCES

(1) Bordonga, J., Presentation at Workshop on Institute for

Emerging Constructed Systems, National Science Foundation

Washington, D.C. February, 1992.

(2) Watanabe, C., "Japan's Industrial Science and Technology Policy," Japan and the

World Economy, Elsevier,

Amsterdam, 1991.

(3) International Conference of Building Officials, Uniform

Building Code, 1991 Edition, p.3.

(4) Civil Engineering Research Foundation, Transferring

Research into Practice, Lessons from Japan's Construction

Industry, Washington, D.C., 1991.

93
COMPACTION MEASURING ROBOT

FEATURES: * No field workers required for robot

o Real time analysis and display increases quality of

work and productivity of compacting crew

FUNCTIONS: 0 Travelling Capacity: Forward, Reverse at 66 ft/min

and up to 1 in 10 slope. Left and right steering, spin

turn and contact stop. Battery Powered and Computer

Controlled.

o Dual Position Identification Systems

"* Automatic navigation system (distance meter,

magnetic position, and vibration gyro sensors)

mounted on robot that detect distance travelled and

direction

"* Information mats at boundary of work for robot to

define boundary and position

o Contact Free Compaction Measuring System

Determines compaction density from back scatter

emissions of gamma ray radiation source, (Co-60), and

moisture content from measurement of heat neutrons

created by emissions from a fast neutron radiation

source, (Cf-252), colliding with the hydrogen of water

TABLE 3 CHARACTERISTICS OF MITSUI SOIL COMPACTION

MEASURING ROBOT

94
PSOCIETAL NEEDI

ICONCEPT DEVELOPM:ENT]DSG

IAdministrative Technical Budgetary

BAICTECHNOLOGYA

RESERCHDEVELOPMENTý

CONTRUCTION

OPERATIONý M~AINTEIi EPIR

EVALUATION]

FIG. 1 THE PROCESSES OF CIVIL ENGINEERING

TECHNOLOGICAL INNOVATION PROCESS: R&D

LUr -- - - - INPUT-----------------------------MACHIINERY----------------------------OUTPUT- ----

Ft OtAL 1CAT ]ON OF~':

M R&D ENVIRONMENT N'.

0 RESOURCES FOR R&D ~Z ~ EEA1N

I *R,&DEXPENDIT JEA TCiOOIA ~$RESEARCK FAC(LITIES ~RESEARCHERSý INNVA400

U 13

i *Ft'VNSOT R&,? 

L~(EGEGONO 'M

I1 1ý .

L - - - - - - - - - - - -- - - -

EXTERNAL TECHNOLOGY

SOURCE: C. WATANABE, "JAPAN INDUSTRIAL SCIENCE AND TECHNOLOGY POLICY",

JAPAN AND THE WORLD ECONOMY, ELSEVIER, AMSTERDAM. 1991

FIG. 2 THE JAPANESE MODEL FOR CONVERSION OF

INTANGIBLE ASSETS TO TANGIBLE ASSETS

95
VrrALITY OF PRIVATE INDUSTRY

AdConsiotnto Adminisurative

Iacilitates to. Univ. Oo

STMLSevs ognd Exen o xtnto ReglationsBwc

for~~~~ necin n ~~ tult Industrya

(Caat.7of Extf ent o xeninReain)ewe

Educatio fo Snt nteWs an Induastria ur

(Sructu erChande

SOCIALPPC~O ANDCUTURL NVIONEN

Level of REOUCOTe maaemn cTiNeORaTlO sUJ 

Ed.catioT AREETII5EUS n OFmeg EA In~frasON u

I ~!~uEAANTO COMMTý S

FIG. 3~~2 JPANSEC INOMAONE O NRESN H

NO= OF EAIATIN!PURQUS ~ 5 O S1JET NORATO

rm a MNT CE OF EXAMINATiN RQUS uJ ION

L. CONDUCT OF WORK

11. NOTICE Of EXAMINATION RESULT

FIG. 4 JAPANESE APPROVAL SYSTEM REQUIRED FOR

USE OF NEW TECHNOLOGY IN PUBLIC WORKS

96
JAPAN U.S.A.

* REASONS FOR RESEARCH

1. Need for housing 1. Lack of design standards

2. Lack of skilled labor 2. Lack of skilled labor

3. Lack of design standards

(JBC screening required)

* OBJECTIVES

1. Design Guidelines for Precast 1. Innovative Building Concepts

Concrete Buildings

2. Design Manual for Precast 2. Connection Classification

Connections Modeling

3. Guidelines for Site Construction 3. Basic Analytical Platform

and Erection

4. Design Recommendation

Platform

5. Coordination

" MANAGEMENT

Ministry of Construction Technical Coordinating

Technical Coordinating Committee Committee

"* REPORT RECIPIENT

Japan Building Center National Science Foundation

"* TIME FRAME

1989-1992 (4 years) 1990-1992 (3 years)

CASH FUNDING.

Government $1,231,000 Government $ 890,000

Industry $1.085.00 Industry S 150.000

TOTAL $2,316,000 $1,040,000

FIG. 5 U.S.-JAPAN COLLABORATIVE RESEARCH ON PRECAST

CONCRETE SEISMIC STRUCTURAL SYSTEMS

97
(A w

84 >4 08 lid 4 E4

u H 0 0

0 H 0 U

r4 Ch 0- E-4 U) 0

U)~ 0- ~ U)I 

M4 0 U a4- ) U

E-4 0

0i 0 E0 3:. k ME %0 C4 v Nl 0 4 cn ( 0 r rf -4 H. D A z ~z u~

M4 to. 4 0 z. I) U) U)

0 U) r4a:mi 0 j 

04 4 > 4 44 ) E-4 H E-4 ~ 0 U 0

E-4 U) U 8 G84 ) tiJ) E- 4 W> z 9 U

084 r4E C

moo E-4 >4 0 H 4(

H H- U)a 4 Ok 3:

84 U)BH

94 U E

.z HU E-.'Q 4 0)

H H89

z 98
U.S. PRESSS PROGRAM

Executive IwU. Nigal Priestley Lnivrslty of Cafilorla. San Diego

Robert U. Englaeilrk Engke~ri and Hanl Consulting Engineers. Ino-

| el Ih. Hawkins Unlv•vml of Washington

Rejiearch 4Glaham Powell Un*vrsty of California. Berkuley

SFq SDany Goodno Georgia ins.tiut o Tehww.g

FEdS Ja SackerThe pms l of~ Coman~ies

flDan Abrams Undvierty of Illnois

PCI Aim Wight UJniversIty of Michigan

FUNDING INf 10

CASH CONT. SUM

Project Title Principal Inve63lgators ________________ _________ NSF PC -M -

Conceptual Development for Precast Robert Englekirk Sesmic Stuctral Systems SusanDowbekaid 100 120 30 150 400

Computer Integrated Manulactudng for NOT FUNDED

Precast •Ssm•c•fctunra Systems

Connection Classification and Modeling John F. Stnton 137 40 177

lot Precast Seismic Structural Systems Nell M. Hawkins

Analyc Platform Doevelvoment Graham H. Powel 227 40 267

Flip C. Filipou

Prestressed Concrete Materials Modeling NON FUNDED

Prelimknary Design Recommendatons Garý C. Hart 160 20 180

Coordination M.J. Nigel Priestey 266 50 316

890 120 30 300 1340 SUM

67 9 2 22 100%

PRODUCT WILL BE RESEARCH REPORTS FORWARDED TO NSF, PCI AND

OTHER INTERESTED PARTIES. NO FORMAL MECHANISM FOR TRANSFER

OF RESEARCH INTO PRACTICE THROUGH ACI OR ICBO ETC. THIS

FIRST PHASE OF THE WORK HAS NO NSF FUNDED LABORATORY TESTING

FIG. 7 FUNDING SOURCES AND PROGRAMS OF

U.S. PRESSS PHASE I RESEARCH

99
BARRIERS TO THE ADOPTION OF NEW TECHNOLOGIES'

Pete Nowak, Professor, Department of Rural Sociology

University of Wisconsin-Madison

INTRODUCTION

There are a number of complex issues surrounding inducing innovation within the

public works infrastructure. A multifarious institutional framework, segmented research and

development of new technologies, and a shifting political context that attempts to balance

differing interests while striving for effectiveness all occurring in the context of competitive

world market. Underlying these complex issues is a rich and diverse research literature on

the adoption and diffusion of new technologies. Contributions from many academic

disciplines as well as the private sector has given us a fairly good understanding of how new

technologies are adopted and diffuse through target populations.

Rather than try and summarize this literature, especially relative to those

technologies associated with the public works infrastructure, attention will be given to a

review of some research generalizations related to the purpose of this conference. In

particular, the focus will be on reasons why individual adoption of a new technology may

not occur. Understanding of these reasons needs to be considered in developing

opportunities for innovation in the public works infrastructure.

REASONS FOR NON-ADOPTION

Why don't individuals adopt new technologies? Individuals do not adopt new

technologies for two basic reasons; they are unable or unwilling. These reasons are not

mutually exclusive. Individuals can be able yet unwilling, willing but unable, and of course

both unwilling and unable. These may sound like minor semantical distinctions, but the

difference between a individual being unwilling or unable is crucial when designing the

appropriate remedial strategy. Accelerating the adoption of new technologies must be based

on understanding why individuals are rejecting this technology; Are they unable, unwilling,

or both?.

Being Unable to Adopt

Being unable to adopt a new technology implies presence of an obstacle or situation

where the decision not to adopt is rational and correct. The important point is that the

individual may be willing to adopt the system, but for one or more of the following nine

reasons is unable to make this decision. Each reason for inability to adopt is followed by

a brief summary of the appropriate remedial strategy.

1 Presented at the workshop on "Challenges and Opportunities for Innovation in the Public Works

Infrastructure," March 3-4, 1992 Champaign, Illinois sponsored by the U.S. Army Corps of Engineers,

Construction Engineering Research Laboratory.

101
1. Information is lacking or scarce. A individual may be unable to adopt a new technology

because some of the basic information needed for a sound functional or economic analysis

is missing.

Generation and distribution of the needed informadion to those needing it.

2. Costs of obtaining information are too high. Even in our highly touted information age,

the time, expense and difficulty (i.e., transaction costs) of obtaining site-specific information

may be too high. Contrary to common belief, obtaining relevant information is not free to

the individual. Too high of a cost and the individual will be unable to adopt.

Reduce tile costs of obtaining needed information by increasing accessibility.

3. Complexity of the system is too great. A defining characteristics of any new technology

is its simplicity or ease of use. There is an extensive research literature that shows the

complexity of a technology is inversely related to the rate and degree of adoption. New

technologies that are too complex make some individuals unable to adopt this technology.

Re-design or simplify the technology.

4. Too expensive of a new technolog. Investment, operating costs and influence on net

returns are major concerns of today's public and commercial sector. Designing a technology

that is technically sound but has too high of a price tag will make many individuals unable

to adopt.

Subsidize the adoption decision or re-design a less expensive system.

5. Labor or management requirements that are considered to be excessive. If the labor or -

management requirements associated with a new technology are perceived to be too high

relative to the capabilities of the adopting unit, then the decision maker will be unable to

adopt.

Re-design or package the new technology to reduce labor or management

requirements, or subsidize the hiring of adequate labor or the training of

managerial staff.

6. Planning horizon is too short. A new technology may be rejected by a decision maker

because of the current planning horizon relative to the time associated with recouping initial

investments, learning costs or depreciation of the present technology. Asking individuals to

make a what might be a major investment within the context of a short planning horizon will

result in their being unable to adopt.

Re-design the technology or subsidize a short-term unprofitable decision.

7. Availability and accessibility of supporting resources is limited. Few individuals adopt

102
innovative new technologies without significant support. This support can take the form of

local businesses willing to take the risk of investing in technologies or services not currently

being used in their market areas, other individuals using new technologies who are willing

to share both successes and failures, and a information and assistance network capable of

answering individual questions. The lack of any one of these could be the obstacle that

creates a situation where a individual is unable to adopt.

Build the capacity of local assistance networks to meet local demands. Target

the development of local assistance networks in the areas needing them the most.

Develop methods to sell new technologies on the basis of need, not ability to pay

or ease of sales.

8. Inadequate managerial skills. One dimension of diversity among target audiences is

managerial skill. Too often new technologies are only designed for the above-average

manager. This can create a situation where individuals with less-than-average management

capabilities receive little or no assistance to build these skills. These individuals will then

make the correct decision in rejecting the new technology due to a lack of requisite

managerial skills or the opportunity to develop them.

Focus assistance and management enhancing opportunities on those individuals

needing it the most, not just the most receptive.

9. Little or no control over the adoption decision. It is common to view a particular

decision maker as some independent being who "calls all the shots" within a public or

private sector organization. This individual, therefore, becomes the focal point of most

efforts to promote new technologies. In many situations, however, a decision cannot be

made without the approval of a executive board, partner, sources of financial credit, or even

a public referendum. If these other interests are not convinced of the merits of the new

technology, then the individual will be unable to adopt.

Determine who or the process associated with making the adoption decision, and

then focus efforts on those persons or organizations.

Being Unwilling to Adopt

A individual may also be unwilling to adopt a new technology. This implies that the

individual has not been persuaded that the new technology will work or is appropriate for

intended setting. There are seven reasons for being unwilling to adopt.

1. Information conflicts or inconsistency. A individual may be unwilling to adopt a new

technology because of inconsistency or even outright conflicts in the information about the

technology. For example, an individual may hear that a new technology always requires

more maintenance, may require more maintenance, or hears about the experiences of

another local organization where the claim is that the technology requires less maintenance.

This individual will often remain unwilling to adopt until these divergent messages become

more consistent.

Work to develop a consistent information base. Where legitimate differences

103
exist, offer explanations of these differences.

2. Poor applicability and relevance of information. In order to make a sound decision,

individuals need information that is applicable and relevant to their situation. Data from

a neighboring state or even across the county may be judged as not meeting local conditions.

Until this data is adapted and made available relative to local situations, the individual will

remain unwilling to adopt.

Generate and distribute relevant information on a local basis.

3. Conflicts between current goals and the new technolo . New technologies do not always

easily fit into the existing infrastructure or support systems. In these cases the general

expectation is that the adopting unit will adapt their situation in order to meet the adoption

requirements of the new technology. The individual may be unwilling if it is felt that too

much adaptation is required for adoption.

Development of flexible new technologies capable of being altered to meet unique

local conditions.

4. Ignorance on the part of the individual or promoter of the technology. Ignorance is not

a pejorative term. Instead, it implies a situation where an individual has not had the

opportunity to learn. This ignorance could be surrounding the basic economic and operating

facts of a new technology, or for promoters of new technologies it could be a lack of

sensitivity to the basic needs of a potential adopter. Regardless of the reason, the outcome

of this ignorance is the same; the individual will remain unwilling to adopt.

Determine the actual, not assumed, assistance needs and knowledge levels of

potential adopters relative to those factors critical to adoption. Then design

education and assistance programs based on individual needs, not agency or

business expertise.

5. Practice is inappropriate for the setting. Another situation is where the individual is

expected to adopt a new technology that may be deemed inappropriate for the current

infrastructure. Some individuals recognizing this incompatibility remain unwilling to adopt.

Specify the applicability of each new technology, or design the technology to be

more adaptable to different institutional settings.

6. Practice increases uncertainty or risk of negative outcomes. A new technology may

increase the probability of a negative outcome in many ways. The complexity of a system,

importance of the timeliness of operations, and the interdependence of inputs can all

increase perceived or real uncertainty and risk. Some individuals are simply unwilling to

make a major decision under conditions of uncertainty, or where there is significant risk.

Uncertainty can be addressed in two basic ways: either increase information so

probabilistic outcomes can be calculated, or subsidize the individual to take a

risk

104
7. Belief in the traditional technology. Although we often scorn beliefs in traditional

technologies, let us not forget that those "traditional" technologies often continue to survive

in today's competitive environment. Some individuals are unwilling to change because those

traditional technologies represent the least risk in a dynamic economic climate.

Demonstrating that a new technology is not only better than the old way, but also

that the new technology does not increase risk.

CONCLUSION

One can make at least two general observations from the foregoing lists of why

individuals are either unable or unwilling to adopt new technologies. First, many of the

factors causing individuals to be unable or unwilling to adopt are beyond their control.

Blaming the individual for not adopting a new technology is not only erroneous in many

cases, it is also hypocritical. Instead of always focusing on the individual, more attention

needs to be given to our efforts in understanding and addressing the many reasons why

individuals are unwilling or unable to adopt. In many cases non-adoption is not so much

a "individual failure" as it is a "system failure".

Second, broad-scale use of any one or even several of the remedial strategies

suggested is doomed to failure. A "shotgun" approach in using technical, financial, or

educational assistance is not the answer. Instead, considerable more effort needs to be

spent trying to understand the reasons why an individual may be unable or unwilling to

adopt. Based on that understanding, one must be able to deliver the specific type of

assistance the individual needs in a format compatible with their capabilities. If we want

accelerated rates of adoption for a new technology, then we must be as willing to accept new

ideas and methods as we are expecting from potential adopters.

Inducing innovation within the public works infrastructure as part of a technology

transfer process is complex. While much of the attention is often focused on the complexity

of the technologies themselves, it is critical to also recognize the complexity of the social,

economic and institutional environment in which these technologies are introduced. This

brief paper has tried to present the perspective of a layperson on this complexity while

focusing on the individual. Yet organizations also make adoption decisions. In fact, relative

to public infrastructure innovations, many of the adoption decisions are made by

organizations. This adds another layer of complexity to the process that needs to be

summarized and translated into layperson terminology at another time.

105
WORKSHOP

CHALLENGES AND OPPORTUNITIES FOR INNOVATION

IN PUBLIC WORKS INFRASTRUCTURE

CONSTRUCTION ENGINEERING RESEARCH LABORATORY

MARCH, 1992

FACTORS INFLUENCING TECHNOLOGY TRANSFER TO

LOCAL PUBLIC WORKS AGENCIES

by

Richard H. Sullivan, Executive Director

American Public Works Association

1313 East 60th Street

Chicago, Illinois 60637

107
The APWA Research Foundation has conducted several studies over the past year to

identify factors which bear upon the acceptance by local public works organizations of innovation

and new technology. This paper will review some of the pertinent findings which must be kept in

mind as one seeks to induce local public works officials to consider adoption of innovation or new

technologies.

Three general characteristics of public works officials are apparent. Public Works officials

are:

1. Very conservative

2. Non-risk takers

3. Find little reward for innovation except their professional pride

The first two factors also generally are characteristics of consulting engineers serving local

government as well as the state and federal regulatory agencies who may have to approve the use of

an innovation process. Nevertheless, we have found that usually local public works officials

believe that they can obtain permission to use/construct new products or techniques if they are

personally convinced of its merit. However, public works officials do not want to be first to

use/construct. They desire the opportunity to observe demonstrations and have peer evaluations.

They have little interest or faith in "Black Boxes."

In 1974, for the National Science Foundation, APWA conducted a study which resulted in

the publication of Dynamic Technology Transfer and Utilization. Public works officials indicated

the following major inflec (not necessarily barriers) to technology transfer:

1. Needs/objectives of the Agency. There must be a problem to be

addressed rather than a solution looking for a problem.

2. Communications. The information available about the innovation must be available

in sufficient detail and verified by reliable sources.

3. Finances. The innovation must be within the means of the agency to

purchase and operate.

4. Regul.ti.o.n The innovation must meet applicable state and federal

regulations. It should be noted that health and safety regulators are as a class Y=

conservative and that extensive testing and multiple demonstration projects may be

required before acceptance.

5. hysica. The size or nature of the innovation in the case of equipment generally

must be capable of installation within existing situations or property owned by the

agencies.

6. Personnel. Operation of the new technology must be such that

existing personnel can safely operate and maintain it.

7. Adminisration. Purchasing regulations must allow sole-source acquisition.

108
Table 1, Ranking of Agencies or Groups Helpful in Adopting New Technologies, is a

ranking of the major groups reported as being used by public works officials in deciding whether

or not they would consider use of a new technology experience shared at conferences and through

informal networks are particularly important.

TABLE 1

Ranking of Agencies or Groups Helpful in

Adopting New Technologies

1. OTHER PUBLIC WORKS PRACTITIONERS

2. MANUFACTURERS

3. PROFESSIONAL ORGANIZATIONS AND ASSOCIATIONS

4. CONSULTANTS

5. STATE GOVERNMENTS

6. FEDERAL GOVERNMENT PROGRAMS

7. UNIVERSITIES AND COLLEGES

As show in Table 2, Ranking of Public Works Functional Areas by Relative Ease of

Technology Application, public works officials have firm perceptions concerning the interest areas

in which new technology may be considered. The ranking of water resources, transportation and

solid wastes at the bottom of the list may well reflect the controls exerted by state and federal

regulatory and funding agencies.

TABLE 2

Ranking of Public Works Functional Areas by

Relative Ease of Technology Application

1. MUNICIPAL ENGINEERING

2. PUBLIC WORKS ADMINISTRATIVE MANAGEMENT

3. BUILDINGS AND GROUNDS

4. EQUIPMENT SERVICES

5. WATER RESOURCES

6. TRANSPORTATION

7. SOLID WASTES

109
Table 3, Influences to Public Works Technological Decision Making, lists the 26

influences cited by public works officials having a potential impact on their decision to adopt or

reject the use of a new technology. One or more factors may drive the decision making process.

TABLE 3

Influences to PubUl Works Technology

Decision-Making

1. RULES, REGULATIONS, & LAWS BY HIGHER LEVELS OF GOVERNMENT

2. JURISDICTIONAL LIMITS

3. INTERJURISDICTIONAL SERVICE AGREEMENTS

4. LOCAL CODES AND STANDARDS

5. COMPETITIVE BIDDING, SPECIFICATIONS AND PURCHASING POLICIES

6. SHARED FUNCTIONS AMONG DIFFERENT LEVEL JURISDICTIONS

7. PUBLIC SUPPORT AND INTEREST

8 DEGREE OF POLITICAL RISK

9. TIMELINESS WITH RESPECT TO THE POLITICAL PROCESS

10. LOCAL INTEREST GROUPS

11. ADEQUACY OF APPLICABLE RESEARCH LEVELS

12. LEVELS OF SERVICE TO THE PUBLIC

13. CIVIL SERVICE OR PERSONNEL POLICIES

14. LOCAL GOVERNMENT FINANCIAL POLICIES

15. EMPLOYEE UNIONS

16. EMPLOYEE ACCEPTANCE

17. EMPLOYEE TRAINING

18. CLIMATE, TOPOGRAPHY AND OTHER PHYSICAL FACTORS

19. ADEQUACY OF EXISTING PROCESS, EQUIPMENT AND FACILITIES

20. NUMBER OF PERSONNEL AND SKILLS AVAILABLE

21. BUREAUCRATIC METHODS

22. FUNDING

23. INVESTMENT IN EXISTING FACILITIES

24. BUDGETING PRIORITIES

25. DEGREE OF ECONOMIC RISK

26. AVAILABLE INFORMATION ON NEW TECHNOLOGY

110
From the overall study, three generalizations can be drawn:

1. Public works officials believe that they can obtain permission for anything that they

believe in.

2. Public works officials do not want to be first, they want to see process

demonstrated.

3. Public works officials do not want black boxes, they want evaluation by peers and full

information.

In 1983, the APWA Research Foundation conducted a workshop for U.S. EPA on the role

of the private sector in conducting environmental research and development for meeting local

agency needs. Proceedings were published as Demonstration Projects and The Development of

Environmental Technologies. The public and private sector participants concluded that government

must assume the primary role of environmental R&D sponsorship. Fragmentation of the market

and constantly revised federal standards were concluded to be major impediment to the private

sector assuming a larger role.

Finally, in 1988, the APWA Research Foundation conducted another workshop for the U.S.

EPA on the role of demonstration projects in acceptance of new technology by public works

officials. Proceedings were published as Defining the Role of Federal and Private Sector Activities

in Solving Municipal Environmental Problems.

Table 4, Findings, lists the seven major findings from the workshop. It was concluded

that before adoption of new technology, the innovation must be demonstrated. The test protocol

for demonstration projects by local agencies must be established in a manner which will allow for

testing over a variety of conditions in order that the demonstration need not be endlessly replicated.

The local agency must have adequate resources to conduct the test and to prepare a comprehensive

evaluation which will be of value to other agencies.

SUMMARY

Extensive research has been conducted to determine the influence which will impact the

decision of local public works officials when adoption of new technology is being considered.

Twenty examples of the adoption of new technology have been described in APWA Special Report

No. 54, Good Practices in Public Works.

As we proceed to meet the needs to rehabilitate our existing infrastructure and meet the new

requirements which are being mandated by Federal and State regulations, we must develop

innovative methods to replace the present costly and sometimes inadequate techniques which have

been in use. Adoption of innovations can be expected when the influences outlined in this paper

are understood by those who would act as "change agents."

IIl
TABLE 4

Findings

1. PUBLIC AGENCIES MUST DEMONSTRATE NEW TECHNOLOGY BEFORE ADOPTION AT

FULL SCALE.

2. PUBLIC AGENCIES MUST DEVELOP MEANS BY WHICH THEY CAN CONDUCT REQUIRED

DEMONSTRATIONS OF NEW AND IMPROVED TECHNOLOGY.

3. DEMONSTRATION PROGRAMS MAY BE HARDWARE IMPROVEMENTS OR

CHANGES IN OPERATIONAL PROCEDURES.

4. DEMONSTRATION PROJECTS MUST BE PROPERLY STRUCTURED AND

ADEQUATELY FR NDED.

5. THE EVALUATION OF DEMONSTRATION TEST FINDINGS MUST BE

CONDUCTED BY COMPETENT PERSONNEL AND THE RESULTS MADE

AVAILABLE TO THE ENTIRE PUBLIC WORKS COMMUNITY.

6. THE ABILITY TO PROPERLY EVALUATE AS WELL AS TO PREPARE AND

DISTRIBUTE RESULTS FROM DEMONSTRATION PROJECTS CONDUCTED BY

LOCAL PUBLIC WORKS AGENCIES MAY WELL REST WITH THEIR ABILITY TO

OBTAIN STATE OR FEDERAL FINANCIAL ASSISTANCE.

7. UNIVERSITIES PROVIDE A POTENTIAL SOURCE OF COMPETENT RESOURCES WHOSE

PARTICIPATION IN A DEMONSTRATION PROJECT MAY ENHANCE THE PROSPECTS FOR

SIGNIFICANT ADVANCEMENTS FOR THE STATE-OF-THE-ART.

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3. INTRODUCTION

The Nation's infrastructure provides an essential platform for most social,

economical, and political activities. The relevance of the public works infrastructure, and the

realization of the need to maintain it in adequate operation are highlighted by much

publicized infrastructure failures. One of them is the recent flood that affected the political

and economical heart of the city of Chicago -also known as the Chicago Loop. A part of

an abandoned underground transportation system, now in use as a path for infrastructure

lines (telephone, power, etc.) became flooded by the Chicago river and affected critical

infrastructure systems and facilities. As a consequence, subway lines, streets, public and

private buildings have been rendered inoperable, with dramatic impacts on all aspects of the

life of Chicago. By still unconfirmed estimates, the damages so far are valued at one billion

dollars. The disruption of normal activities is likely to span for several weeks if not months.

This event, although unique in its magnitude, is useful to highlight the essential nature of

the infrastructure.

The 80's were an important decade for the realization of the severe problems that

affect the Nation's public works infrastructure, and for the building of consensus to address

these problems. In the early 80's, several studies brought into public light important and

timely concerns about the health of the different infrastructure systems and facilities [AGC

81, Choate 83]. These and other initial studies were followed by interest at different sectors.

This interest translated into developing consensus on the magnitude of the problem,

proposing very needed corrective actions, and initiating a few of these actions [NatResC 87,

NCPWI 88, OTA 87]. The still young decade of the 90's is witnessing a continuation of this

effort to build momentum for action [CERF 91a, OTA 91].

One of the key points in the recommended actions to enhance the condition of the

public works infrastructure is the need to encourage the utilization of new technologies

[CERF 91a, NCPWI 88, OTA 91]. Technology and innovation can play a major role in

extending the lives of public works facilities and provide substantial cost savings. A recent

OTA report emphasized that no Federal government agency has focused on R&D programs

to make public works entities more productive and cost effective [OTA 91]. It also pointed

out that State and local public works agencies benefit of R&D products only after a very

long process of development, evaluation, and modification. This length of time, coupled

with the lack of investment in public works R&D, make this area unattractive for

researchers, leaving large gaps. The present report responds to the need to fill these gaps

through an attempt to identify: the obstacles that challenge the successful generation and

adoption of innovations; and the opportunities that exist to promote the incorporation of

innovations in the public works infrastructure.

The term innovation is used in this report with an ample meaning. Successful

innovation is a product, process, or procedure introduced into the market place to

significantly reduce cost and time, to improve quality, or to increase performance and

service to the public. Innovation can originate from research and development (R&D)

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activities. Another important source of innovation consists of actual practice; practitioners

often develop innovative solutions to their problems. Innovation areas are as varied as

problem areas exist in practice, such as management, standards, products, materials,

methods, finance, and other areas. Furthermore, innovation is relative to the potential user.

Anything that is new for the potential user is an innovation.

As mentioned, this report addresses challenges and opportunities for innovation in

the public works infrastructure. The term public works infrastructure also is used with ample

meaning, and includes systems under public responsibility to provide support for:

transportation (highway, rail, waterways, air, etc.), water supply and distribution, power and

energy generation and delivery, communications, solid waste collection and disposal. The

meaning of public works infrastructure also includes environmental remediation services.

Although it is very difficult to estimate the impact that innovation can have in

rendering the public works infrastructure more efficient and effective, there are some

numbers that indicate the potential that exists. Figures are available from different sources

to support the value of R&D results applied in practice. The California Department of

Transportation has concluded that cost savings directly attributable to R&D products in

practice are between 2.8 and 5.4 times the investment in R&D [CaIDOT 87]. The Army

performed a measurement of R&D product payoff for selected successful innovations, and

determined it to be $37 for each dollar invested in the R&D phase of these products

[Shaffer 92]. It is clear that innovations can have a dramatic impact in lowering the effort

of building and maintaining the public works infrastructure.

However, the US is not taking good advantage of this potential benefit from

innovations. Comparisons have been made in some areas of research spending, with

research spending in other industrialized countries. Figures provided by the American Road

and Transportation Builders Association (ARTBA) indicated in 1989 a commitment of $2

million in the US for research in intelligent vehicle and highway systems, compared to a

$750 million investment in Europe and a $700 million in Japan [GAO 89]. In addition to

this lack of investment, there is a problem of transferring innovations into practice. The

rate of adoption of innovations in the US is very slow, with more than 20 years required in

many cases to reach most users.

This report is composed of two main parts. Part 1 attempts to summarize the

challenges and opportunities for innovation in the public works infrastructure identified

through a literature survey. This literature survey includes a review of recognized models

of the process of generating and adopting innovations. It also addresses specific challenges

and opportunities for innovation in the public works infrastructure, discussed in the

literature. Finally, it provides some recommendations to overcome the challenges and make

use of the opportunities.

Part 2 consists of the proceedings of a workshop that was held on March 3-4, 1992

at USA-CERL, to discuss the promotion of innovation in the public works infrastructure.

114
A group of recognized experts on issues related to innovation and the public works

infrastructure were invited to share and examine their views. The participants were selected

in such a way that their views and perspectives would cover most of the relevant challenges

and opportunities for innovation.

115

IDMXIFYINGv PROGRI1KINGe AND ZNZCUTZNG INYRRSTRUCTURZ R&D

Carl 0. Magnell

Director of Research

Civil Engineering Research Foundation

INTRODUCTION

On behalf of Harvey Bernstein and the others at the Civil

Engineering Research Foundation, I would like to express our

appreciation for the opportunity to be a part of this seminar. As

you can appreciate, we are much concerned about the issue under

review here, namely innovation, and how to effectively translate it

into the public works arena.

I have begun to shape a perspective on public works/infrastructure that I would like to share, if nothing else,

as a conversation and thought piece. Let me begin by setting the

stage. I assume many of you read in this morning's paper about the

UofI co-ed's whose letter home truly impacted on both her father

and mother. It appears that she hadn't communicated with her

parents for about a month, a month during which something important

had also impacted on her life. So, she wrote "I'm sorry that I

haven't written sooner, but I didn't want you to worry and get

upset by my telling you about the fatal fire in my dorm;

fortunately, I wasn't hurt. The young man who helped save my

belongings was really nice to me, and has even let me stay with

him. We are getting along fine and I'm sure you will be pleased to

hear that you are going to be grandparents!" At this point her

father's temper soared out of control and the mother fainted. They didn't get to the next part of the letter, which read, "Dear Mom

and Dad, don't worry! There was no fire, I haven't met anybody, and

you aren't going to be grandparents. I just don't know of any

other way to tell you that I failed ny elective, "Introduction to

Innovation in Public Works Infrastructure", and somehow put it into

perspective for you. Our collective challenge, it seems, is to put into perspective what our nation's grade really is, with respect to

public works infrastructure, and what actions are both necessary

and possible.

My own purpose in this paper is to briefly consider the broad

challenges of identifying, programming, and executing Public Works

Infrastructure R&D.

PUBLIC WORK8 INFRSTRUCTURE: THE CONCEPT AM THE PROCE88

The R&D challenges I will consider are imbedded in a process

and are part of a concept that in themselves are imperfectly

understood. What is Public Works Infrastructure for the Civil

Engineer and the Civil Engineering profession? Definitions abound,

117
abound to the point where I have opted to define it as a concept

that satisfies my perspective. It is simply that Public Works

Infrastructure is the net of comuon structures/facilities

(constructed and natural) that enable a society to function. Note

that this definition does not judge the quality or complexity of

either the society or the infrastructure; it applies equally to the

greatest and the least of societies.

The process that creates a Public Works Infrastructure is

likewise subject to diversity, diversity that challenges a common

view. In a simple perspective, however, it is a classic supply and

demand relationship, as depicted in Figure 1. Demand is created by

a variety of forces (to include bpecial interests), as is clearly

evident in the case of the United States. Supply in this

relationship is not the public sector, but rather the thousands of

potential providers of material, equipment, financing and other

services. The public sector, in a variety of forms, from local to

regional to Federal, is the provider of Public Works

Infrastructure. The end "product", in innumerable forms, is the

result of the iterative and continuous interaction, feedback, and

barriers associated with this process, as also depicted in the

figure.

An additional perspective of Public Works Infrastructure is to

understand it in the context of a decision function, integrated

over time, in which the product, viewed either as a single output

or the sum of outputs, is the result of complex, interdependent

decision variables that encompass, among others, resources, vision,

marketing, innovation and incentives.

IDENTIFYING PUBLIC WORKS INFRASTRUCTURE R&D NEEDS

It is very tempting to suggest that this is a challenge that

has been confronted and solved! After all, I can point to a copy

of the final report from the CERF initiated National Civil

Engineering Research Needs Forum, and note that the Forum members

have identified five critical Thrust areas and 35 specific high

priority research issues. Furthermore, statistics suggest, and it

has already been noted in earlier presentations, that the core of

the problem must be insufficient public works infrastructure R&D,

since our U.S. research appears low, relative to the other

industrialized nations, notably Japan and Europeans. This is, in

essence, what I suggested in some remarks at the National Institute

of Standards and Technology (NIST), several weeks ago. However,

I'm no longer so sure this is the core of our problem. It is

obvious that many facets of public works infrastructure need the

benefits of more R&D. As one example, we are now working with a

number of other interested groups to formulate a national R&D

program in high performance concrete and steel, a program that

appears to be on the order of $200-300 Million, over 5-6 years.

One can also expect that the program will expand to encompass other

traditional as well as non-traditional public works infrastructure

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materials. But, is our Public Works Infrastructure challenge

merely technical, or even largely technical?

Several weeks ago, I participated in another infrastructure

workshop. Low quality, lack of innovation, and inadequate

education were suggested as the fundamental problems in public

works infrastructure. Are they fundamental, or are they merely

symptoms of deeper problems such as risk, and lack of a

coordinated, focused public/private approach? What isn't clear is

that innovative technical possibilities, brought about by focused

R&D, will lead inevitably to an improved public works

infrastructure. After all, much of the successful research

conducted in the U.S., is implemented in other countries, or

returns to the U.S. as a foreign product. Likewise, innovation

appears to be far more successful in the "industrial" component of

U.S. construction. We can add to this other factors, such as the

highly fragmented nature of both our public works infrastructure

and our design/construction industry.

Two days ago, I noticed what appears to be a striking analogy

to our public works infrastructure challenge. In a Washington Post

article,' Zbigniew Brzezinski discusses the collapse of Soviet

Communism under the heading, "The West Adrift: Vision in Search of

a Strategy!" Let me excerpt some of his observations:

The collapse of Soviet Communism calls for both a compelling

vision of the future and coolly defined strategic goals.

A vision is not the same as policy. A policy must define

strategic priorities that are attainable even if short of the

wholly desirable.

As it (now) is, Western policy involves a mixture of:

generalized hopes.., gnawing fears.., torrents of advice..,

endless schemes for grand solutions.., short term pell-mell

aid.., and, little attention to the longer range structural

reforms...

He goes on to say that the "result is a policy remarkably lacking

in strategic design and strategic coordination. It is not,

however, contrary to the criticism that is often made - lacking in

money or generosity."

Are his observations relevant for public works infrastructure?

If we substitute the term public works infrastructure for his

subject "Collapse of Soviet Communism," are the observations still

true?

'Washington Post Vol 87, 1 March 1992. "The West Adrift:

Vision in Search of a Strategy."

119
Is the bottom line that the first barrier in identifying

public works infrastructure R&D needs may be the lack of a

compelling vision of the desired end state. What is the vision for

a public works infrastructure, and of the constituency in this

infrastructure which, unlike Adam Smith's "rational man," is not

homogenous, not focused, and not necessarily predisposed towards

decisions that are in the collective best interest? Indeed, they

may have no opinion, or a limited opinion, of what a compelling

public works vision should be.

PROGRAMMING PUBLIC WORKS INFRASTRUCTURE R&D

My experience suggests that there is a fundamental law which

states that the energy level required for programming problem

solutions is greater than that for identifying problems. The

contrast between the National Needs Forum and its outgrowth, the

CERF Implementation Task Force, or ITF, is probably proof of this.

Another good example may be the Allied experience in Desert

Shield/Desert Storm. Problem identification was not a problem as

far as we know. On the other hand, programming the solution was

incredibly complex, and costly. Underlying this effort, however,

was both a compelling vision of the desired end state and

attainable strategic goals. Are there identified attainable

strategic goals for public works infrastructure? The National

Needs Forum required three days to develop critical Thrust areas

and a prioritized research needs list that has garnered general

approval and acclaim. The Implementation Task Force has faced the

programming challenge for about six months and it is not an easy

exercise. We seem to be making progress and will soon make

specific recommendations to the CERF Corporate Advisory Board, but

it is not possible to suggest that these recommendations are linked

to a compelling vision of what public infrastructure ought to be or

to attainable strategic goals; they may reflect a more limited

vision of what small pieces might look like. In all fairness,

however, I must note that the effort of the ITF encompasses more

than public works infrastructure.

The bottom line in programming for public works infrastructure

R&D seems to require attainable strategic goals, goals that define

what infrastructure components should encompass and/or be capable

of doing, for example, performance, near and long-term capacity,

interaction with other infrastructure components, durability, ease

of maintenance and life cycle cost.

EXECUTING PUBLIC WORKS INFRASTRUCTURE R&D

One aspect seems critically important when we consider actual

program execution; the research can't be allowed to be an end in

itself! This, unfortunately, seems too often to be the case and it

may be the norm unless we seriously tackle the barriers. Each

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research report should be required to have a well-thought out tech

transfer plan, a plan that may not be developed by, or even

involve, the researcher. A key focus here, and indeed throughout

the R&D effort, is marketing. The other day I heard what I think

is an innovative way of viewing marketing. Marketing was defined

as the "engineering of the customer's mind." I believe it is

something we have to become much better at, if public works

infrastructure is to improve and truly be an asset, rather than a

liability, for the nation. Our problem is greatly magnified by the

fact that public works infrastructure involves not one customer,

but as already noted, as diverse a group of decision makers and

users as one is likely to encounter anywhere.

It also seems true that execution requires a continuous

iterative approach, an approach that defines objectives,

establishes the existing technical/non-technical baseline,

determines the scope of the required research, performs the

research, demonstrates the results, accomplishes the appropriate

tech transfer, and then repeats the process, this time seeking to

attain revised, more challenging objectives. In other words, a

process somewhat similar to the progressively higher performance

objectives in total quality management.

CONCLUSION

The philosopher Spinoza noted some several hundred years ago,

that, "true excellence is as difficult as it is rare." If we are

to achieve excellence in our public works infrastructure, we must

create a compelling vision that allows accurate problem definition,

build a strategic program on attainable goals, and execute in an

iterative fashion that focuses on both the currently attainable,

while not losing sight of the desirable, but continually evolving,

end state. This may be a combination that spells success!

Res\CERL.PPR

121
SUPPLY DEMAND

Provider of

Public Works

Infrastructure

PRODUCT

Figure 1. Supply/Demand Public Infrastructure Model

122
INFRASTRUCTURE FINANCING: THE STATE AND LOCAL GOVERNMENT

PERSPECTIVE

Benjamin Mays, Manager

Government Finance Research Center

Government Finance Officers Association'

The Government Finance Officers Association and the Association's Interest in

Infrastructure

The Government Finance Officers Association (GFOA) is pleased to participate in this

conference. The GFOA is a 12,500-member professional association of state and local

government officials who are engaged in all areas of public finance. The Government Finance

Research Center (GFRC), research arm of GFOA, performs research not only for the association,

but on a contract basis as well for state, local and federal government agencies and other public

and private organizations. Much of the Research Center's work for well over a decade has been

in the area of infrastructure financing covering a variety of topics of concern to state and local

governmentsi.

Working with the U.S. Army Corps of Engineers is not new to the Research Center. In

1982, the GFRC assisted the Corps in determining local government financial capability for the

proposed Chicago Deep Tunnel project 2 . Following Congressionally mandated changes in

funding requirements for Army Corps projects in the late 1980s, the GFRC assisted the Corps in

the Ohio River Basin Division in assessing the legal and financial mechanisms available for

funding Army Corps projects at the state and local level throughout the six state region 3 .

"With assistance from Catherine L. Spain, Acting Director of the Government Finance Research Center and

Barbara Weiss, Assistant Director, Government Finance Research Center.

1 Recent projects have included "Tax Increment Financing in Maryland"; An Impact Fee Study for David M.

Griffiths and Associates, Ltd., and "Tax Reform and State Revolving Funds" for the Council of Infrastructure

Financing Authorities.

"2 "Comparative and Sensitivity Analysis Municipal Fiscal Stress Study", for the Department of the Army,

Corps of Engineers, Chicago District, May 1983.

"3 "State and Local Cost-Sharing in Corps of Engineers' Planning Studies and Water Resources Development

Projects", Phases I and II Reports, for the Department of the Army, Corps of Engineers, Louisville District,

January and August 1988.

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The GFRC has assisted other federal agencies in infrastructure-related activities,

particularly as a nationally recognized leader in the determination of municipal financial

capability for sewer and water system compliance with the CleanoWater Act. The Financial

Capability Guidebook, authored by the GFRC became the U.S. Environmental Protection

Agency's (EPA) "bible" for determining municipal financial capability. From the guidebook,

the GFRC developed a microcomputer software template, FINCAP, enabling communities to

determine their own financial capability.

Transportation and environmental infrastructure financing have also been GFRC

specialties. Contracts analyzing transportation system financing for regional government's

highway financing options have been undertaken for the U.S. Department of Transportation. In

the area of solid waste services, GFRC efforts have included the establishment of a tipping fee

structure for Portland Oregon, research on solid waste taxes for Baltimore County, Maryland,

and development of complex computer models for solid waste system financing for a private

consulting group

GFRC has also examined the fiscal impacts of growth, including the provision of new

infrastructure facilities and structures. Its work has led to a microcomputer software package,

the Total Impact Management Model, which allows governments to determine the impacts of

specific developments and development scenarios on their operating budgets and on capital

requirements ranging from governmental buildings and roads to schools and landfills.

Serving as a hands-on financial advisor to individual local governments, the GFRC has

assisted with the debt issuance process, providing advice on financial markets and financing

techniques. The financings have included projects have included waste-to-energy plants; court

buildings; jails; schools; water and sewer system plant provision, expansion and upgrade;

libraries; administrative complexes; landfills; and roads. This has included such innovative

approaches as privately owned toll roads.

What is Public Infrastructure and Who is Responsible for Its Provision?

There have been many studies on infrastructure and as many attempts to define it.

While various categories of facilities appear on some but not other lists of "public

infrastructure," there is a central core of categories that appears to be commonly accepted:

transportation (highways, mass transit, bridges, railways, waterways and airports) and

124
environmental facilities (water supply, sewage treatment, storm drainage and solid waste

disposal.) For the purposes of this presentation, we will focus on these specific categories of

infrastructure. Not included in this discussion is the substantial list of other public capital

categories discussed or proposed as public infrastructure, including& but not limited to: human

capital (education, health, libraries), energy supply (electric and gas utilities), and economic

development. This presentation will specifically deal with the state and local government

provision of a subset of infrastructure facilities, structures, and systems.

Under the American federal system of government, different levels of government bear

direct responsibility for the provision of particular infrastructure projects. In some cases, one

level of government will be responsible for the construction of a class of facilities and a different

level of government responsible for the operation and maintenance of those facilities.

Notwithstanding this diversity, there remains a continuous interaction of construction and

operating financial responsibility occurring between and among all the different levels.

Nowhere is this more evident than in the direct or indirect provision of funding for different

project categories.

The federal government has direct responsibility for the provision, the actual

construction, of infrastructure to a limited degree only; it is most clearly seen in federal

military and civilian installations, in the extensive Department of Interior and Agriculture

land holdings, and on Tribal reservations. The larger federal role in infrastructure provision

is evidenced in its support of state and local government efforts through the use of grants, loans,

maintenance of the tax-exempt status of municipal bonds, provision of credit assistance and

other efforts.

Direct support of infrastructure projects is largely a state and local government

responsibility. State governments generally have primary direct responsibility for most ground

transportation infrastructure, while the remainder of transportation infrastructure and the bulk

of environmental infrastructure responsibilities reside at the local level. Much of this local

responsibility is shared by multiple jurisdictions through formal cooperative arrangements--

regional transit or water and sewer authorities are but a few of these kinds of formal

arrangements.

125
Financial Sources - - The Intergovernmental Dimension

Throughout the 1960s, 1970s and the early 1980s, infrastructure financing had a strong

federal component 4 . During the last decade, however, that federal financing role has

diminished concurrent with a rise in federal mandates for infrastructure facilities. As shown

in Table 1, State and Local Fixed Capital Formation, the nonfederal role in financing

infrastructure has increased dramatically during this period and has shaped the state and local

government quest for alternative financing methods, which will be discussed later in this

presentation. The outlook for the future indicates that some increases in the federal role may

occur, even as state and local government funding sources become increasingly constrained.

The recent history of federal funding for infrastructure can be viewed along three

continuing themes:

* a steep decline in federal grants and subsidies,

* an increasing reliance on federally backed or federally seeded loan programs,

and

steep increases in federal mandates.

The demise of the federal General Revenue Sharing Program, cutbacks for the Urban

Mass Transit Administration (now the Federal Transit Administration) and Community

Development Block Grant programs, the elimination of the EPA construction grants program,

and the financing source restrictions on the Army Corps of Engineers water management and

supply projects have all limited federal involvement in the provision of infrastructure. Budget

constraints have also limited the federal government's willingness to use monies accumulated

in the Highway and Airport Trust Funds.

Through its State Revolving Fund (SRF) program, established in the Water Quality Act

of 1987, the federal government has encouraged the use of state loan programs to replace the EPA

Construction Grants Program. Using federal grants for initial capitalization, these loan

programs have become an important, though limited, source of local funding for wastewater

treatment facilities. Expansion of the revolving loan fund concept to aid in financing other

infrastructure facilities is under discussion. The concept has already been applied in the State

Flexibility Program contained in the recent Intermodal Surface Transportation Efficiency Act

4 GFRC estimates from U.S. Department of Commerce, National Income Product Accounts

126
of 1991 which will provide federal monies to individual state fund programs for use on a variety

of transportation projects.

The decline in federal funding of infrastructure has coincided with the promulgation of

massive federal mandates for environmental infrastructure improvements. The Clean Water

Act, Clean Air Act, Safe Drinking Water Act and laws concerning solid and toxic/hazardous

waste, which have forced state and local governments to spend (collectively) billions of ownsource dollars 5.

State governments have continued their historical role in financing a large portion of

transportation-related infrastructure, but the decline in federal subsidies has had its effect. This

traditional transportation responsibility has been forced to compete for revenues with the new

requirements for environmental infrastructure financing. While the states have had to assume

a greater role in transportation and environmental financing, as a result of waning federal

funding and waxing federal mandates, local governments, especially the smaller or less

wealthy municipalities, have been forced to depend upon state assistance to meet many of their

increasing infrastructure responsibilities. State governments have responded with a variety of

funding mechanisms, including new intergovernmental grants and matching funds,

revolving loan funds, bond pools, and credit assistance programs. For example, the

Washington State Department of Ecology has been able to provide construction grant monies to

small or fiscally distressed communities that must comply with Clean Water Act standards, but

lack the financial capability of constructing the mandated facilities themselves. These

communities would once have been able to turn to the federal government for these grants, but

now the state must direct its own tax revenues to these communities.

Local governments have borne the brunt of the infrastructure funding shifts of the last

decade. Increasing responsibility for transportation improvements combined with expanded

environmental infrastructure responsibility have left local governments grasping for funding

alternatives. State governmer~ts have provided some relief for these conditions, but, the overall

burden has increased. State and local governments also face a powerful constraint on

infrastructure financing that the federal government does not share: the common requirement

of an annually balanced budget. In some states and localities this proscription is formal and

constitutional, while in others the requirement is informal or traditional. In either case, the

5 As evidenced by the increasc in average long-term bond issuance for utility issues from less than $5 billion

per year prior to 1985 and from S10 to 19 billion per year thereafter.

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constraint upon state and local governments is significant. States are now facing cutbacks in

their operating and capital programs due to recessionary pressures, and have been forced to

transfer financial responsibility to the local level. Consequently, local governments have had to

rely increasingly on their own-source revenues, rather than intergovernmental transfers from

the state or federal government, and their own individual credit to meet these responsibilities.

The outlook for future financing sources is mixed. There is visible support for an

increased federal role in infrastructure financing, as evidenced by the recent Intermodal

Surface Transportation Efficiency Act of 1991, and the outlook for relief from federal tax code

restrictions on tax-exempt bonds is brighter than in previous years. Members of Congress and

others have publicly linked the lack of investment in infrastructure to declines in productivity.

and indeed, there is a ,rowing body of research establishing this linkage. On the other hand,

the ability of state and local governments to continue to provide the bulk of infrastructure

financing has become nore limited: recessionary pressures on revenues have reduced the fiscal

flexibility of most governments while declining revenues have coincided with a growing tax

revolt movement in many states. These two trends have contributed to the increasing use of

municipal debt for infrastructure finance.

Financing Methods - - The Menu of Options

During the 1970s the federal share, including direct construction and transfer/grant

funding, of public capital construction spending rose from an estimated 32% in 1970 to a highwater mark of 51% in 1981 and has declined to 34% in 1990. While infrastructure and other

public capital expenditure rose during this period, the federal share of this spending, in relative

terms, declined. The absence of federal dollars has been made up by the increased use of state

and local own-source revenues and tax-exempt municipal debt 6 .

Own-Source Revenues (Pay-As-You-Go)

Governments finance their infrastructure improvements in a variety of ways. One of

the most traditional funding mechanisms has been to pay for these improvements out of ownsource revenues. This method is often referred to as Pay-As-You-Go. Over the past two decades,

state and local governments have been increasingly forced to rely for infrastructure

6 Historical data calculated from Value of New Construction Put in Place: May 1991, Current Construction

Reports, C30-9105; U.S. Department of Commerce, Bureau of the Census, Washington, DC , August 1991;

and, Fixed Capital Formation 1955-1990, Government Finance Research Center, Washington DC, 1991.

128
expenditures on revenues that normally would go to their general governmental fund (the

General Fund) and would, therefore, be used for the daily operation of government. The main

sources of General Fund revenues vary widely among different governments: state

governments generally rely on sales and/or income taxes, while most local governments

receive the bulk of their funds from property and other ad valorem taxes. Local and regional

utilities receive their main revenues from user fees, connection charges, and similar rate

mechanisms. In some cases, special districts have been established that raise revenues based on

special assessment property taxes or incremental taxes; these revenues are earmarked for

specific capital purposes. Impact fees and other developer exactions also may provide

significant own-source revenues. It must be remembered that own-source revenues, which are

increasingly required for infrastructure provision, are the same limited revenues that are

required to support the politically-sensitive operating budgets of governments.

Debt Financing for Infrastructure

It is clear that own-source financing available to state and local governments has not

been sufficient to meet the need for infrastructure capital. The debt-financed share of state and

local capital expenditure rose from 37% in 1981 to 55% in 1990. The dollar value of debt-financed

capital construction rose from just under $20 billion in 1981 to $60 billion in 1990. While these

numbers represent the total funding of state and local public capital, not just the infrastructure

portion defined above, they demonstrate the significant changes in revenue sources available for

infrastructure, and the resulting greater reliance on the municipal bond market.

That debt financing of infrastructure has increased dramatically is not surprising,

given the high levels of construction activity over the last decade. Total state and local public

construction rose from $54 billion in 1981 to $96 billion in 1990. Of that total, highway and street

construction increased from $17 billion to $30 billion, wastewater treatment system construction

rose from $6 to $10 billion, and water supply facility construction rose from $3 to $5 billion. 7

Comparable figures are not available for the other forms of public infrastructure, but there is no

reason to believe that the trend for those facilities has been any different. The debt-financed

share of these categories show similar increases: $5 billion in long-term bonds were issued for

transportation purposes in 1982, and $15 billion was issued for similar purposes in 1991. For

water supply and sewer system purposes, $4 billion in long-term debt was issued in 1982, while

$19 billion was issued in 1991.8

7 Value of New Construction Put in Place: May 1991.

8 The Bond Buyer, Tuesday, January 21, 1992.

129
To understand the implications of this increase in debt financing to provide

infrastructure, a look at the recent history of the municipal bond market is instructive. Prior to

1987, the volume of tax-exempt municipal debt had increased emery year in recent decades.

Particularly high volumes occurred in 1985 and 1986 as a result of issuers rushing to market to

avoid new restrictions contained in the Tax Reform Act of 1986. Indeed, those tax code changes

prompted record levels of debt issuance for every category of capital construction. Significant

fall-offs in tax-exempt volume in all categories occurred in 1987. The 1986 level was reached

and surpassed in most categories in 1991.9 The noteworthy difference in the mix of purposes of

1991 tax-exempt borrowings is the significant increase in the issuance of debt for purposes

generally regarded as "governmental" (including infrastructure) and a decline in "privateactivity" related issues. Again, a shift brought about by the provisions of the federal tax code.

Debt issued for transportation purposes has largely been in the form of general obligation

(GO) bonds, bonds that are backed by the full faith and credit of the issuing entity. This means

that the issuing government pledges to set its tax rate (sales or income for states, property for

local governments) at a level sufficient to pay annual debt service requirements. This is the

most secure form of pledge available from municipal debt issuers and usually less costly than

other forms of bond issuance. Most governments are required to have voter approval through

referendum to issue GO debt.

Other forms of security can also be pledged for payment of debt service. Limited

obligation bonds exist in a variety of formats. The common traits of these instruments are that

they have no legal claim on the general tax levy of the government, do not contribute to any

statutory legal debt margin, and generally do not require voter approval.

Pledge or appropriation bonds are based on a moral obligation of the issuing government

to appropriate sufficient revenues for meeting debt service requirements. Lease-purchase and

certificate of participation issues, known as COPs, are based on the local government

establishing, in essence, a pass-through issuance of debt using as the vehicle a private

independent lessor entity, which holds title to the constructed facility. These instruments are, in

practical usage, little different than the pledge and appropriation bonds.

9 The Bond Buyer, Tuesday, January 21, 1992.

130
Many infrastructure improvements are financed through debt issued by special

assessment and tax increment districts. Backed by a special property tax on the value of property

in the district which is in addition the regular ad valorem rate, special assessment debt has the

advantage of targeting the beneficiaries of the improvement for theopayment of the debt service.

Tax increment districts issue debt that is backed by a tax on increases in property value that are

presumed to have resulted from the provision of the infrastructure improvement. These formats

are often used for either transportation or sewer and water improvements.

Specific revenue sources may also be pledged for debt service payments on revenue

bonds. General sales taxes; sales taxes on specific items, such as gasoline or tires; water and

sewer rate collections; lottery proceeds; toll revenues; licenses; and many other revenue sources

may be pledged as security for the various forms of revenue bonds. Some revenue bonds are

additionally secured by a pledge of general fund support. These bonds, referred to as "doublebarrelled," bonds generally are issued when the revenue stream pledged for debt service

payment is not deemed sufficiently reliable to attract investors at a low interest rate.

There are numerous variations of GO and revenue bond issue types, as local

governments and their financial advisors continually search for ways to issue tax-exempt debt

at lower cost. Some of these efforts aim at enhancing the credit quality of the issue, a strategy that

is available through the use of letters of credit, bond insurance, restrictive bond covenants and

the use of reserve funds, among other techniques. While the popularity of these techniques varies

in relation to changes in interest rates, all have grown in usage over the last several years.

Municipal issuers also employ a variety of methods of sale and structure. Smalldenomination bonds (also called minibonds), variable-rate demand notes, or foreign currency

denominated instruments have all been used creatively to attract investors. Other innovative

techniques currently in use include: Dutch auctions, guaranteed investment contracts (GICs),

interest rate swaps, and capital appreciation or zero-coupon bonds.

All these techniques are used to attempt to lower the issuer's cost of borrowing. The

promise of a government to meet its debt service obligations must compete with the government's

desire to meet its service responsibilities, and any technique that lowers interest rates (and

therefore reduces debt service) must be explored in these times of tight budgets.

131
Intergovernmental Sources of Funding

Intergovernmental revenues, the third source for infrastructure financing, include

federal funding for the states, as well as federal, state and regional funding for the localities.

Intergovernmental support takes a variety of forms: chief among them are grants, loans, and

credit assistance.

Grant funding is available for some projects from ei'Lhel or both the state and federal

levels. These grant monies often require a matching or perwentage share from either the state or

local government. Federal grant monies have declined in the past decade; however, states have

had to provide some grant support, especially for the poorer or smaller communities.

State loan programs are currently the rage among federal lawmakers. The State

Revolving Fund (SRF) programs are projected to be the forerunners of future intergovernmental

financing arrangements. The SRF programs for sewer system improvements were funded with

a capital contribution from the federal government. Those monies have been leveraged by the

states through the issuance of debt and, in some cases, supplemented by state tax revenues to

increase program resources. Some of these state loan programs, such as the one sponsored by the

Texas Water Development Board, also require a matching or proportionate share of local

fundinglO.

One of the ways in which states aid local governments in providing infrastructure

improvements is through credit assistance. Many states have agencies that act as a conduit for

local governments in the issuance of debt: By pooling bond issuances of a number of

jurisdictions, the state agency enables issuers that are too small to normally access the capital

markets to borrow efficiently. Some states provide the pooled issues with some form of state

guarantee or security, thereby allowing the more financially troubled communities to issue their

debt at a rate lower than that which could be obtained under their own individual credit. As an

example, the Virginia Resource Authority (VRA) purchases bonds from several local

governments who are issuing debt for environmental infrastructure improvements, then the

VRA issues a comparable amount of debt under its own name. This debt invokes the credit

support of the Commonwealth and, therefore, offers many communities significant debt service

savings over that which they would have to pay under their own credit.

10 GFRC is currently studying significant features of thc various SRF programs for U.S. EPA and will publish

its findings soon.

132
While not considered traditional intergovernmental financing, regional infrastructure

programs have also been established to deal with increased capital requirements. In general,

the bulk of the financing for regional programs and authorities, comes from the individual

member communities, with contributions either made from debt issuances or own-source

revenues. As an example, the Massachusetts Water Resource Authority acts as a water and

sewer "wholesaler" to over 40 Boston area communities. There are, however, many states that

provide matching funds for some regional efforts, especially in the environmental

infrastructure areas.

Public-Private Partnerships

The significant source of infrastructure finance is the various forms of public-private

partnerships. "Privatization" means different things to different people. It can mean private

ownership and operation of a facility, private operation alone, or something in between.

Privately owned or operated toll-roads, bridges, water and sewer systems, airports and ports

have all been proposed or inaugurated in recent years. When Loudoun County, Virginia was

approached just a few years ago by private concerns armed with a proposal to build and operate a

private toll-road extension, the idea was considered either revolutionary or a throwback to early

Federalist days, depending on the philosophy of the officials. Now, that concept is vigorously

supported by national leaders, and loans for such projects are contained in the federal

Intermodal Surface Transportation Efficiency Act of 1991. In another example of partnership

efforts, governments have entered into relationships with the private sector that have resulted in

large equity contributions from directly affected entities. These kinds of private-sector

solutions help to supplement the increasingly scarce resources available from governments for

infrastructure and are clearly going to continue to be the subject of debate.

Barriers to Financing Infrastructure

Constitutional Restraints

One of the barriers to national solutions to infrastructure problems is the very nature of

the United States. The elaborate federal system of government allows the individual states to

retain tremendous unique institutional powers. This means, in effect, that there must be 50

separate adaptations to each national solution. Each state has its own distinct constitution, and

its own unique relationship with its subordinate units of government. These basically distinct

constitutions create significant differences in infrastructure provision between states and may

contain provisions that retard or complicate that provision.

133
Tremendous differences exist among the states with regard to the independent powers of

local governments. There are "Home-Rule" states in which all governmental powers not

specifically given to the state are construed to reside at the city or county level. The opposite

condition exists in the "Dillon Rule" states, where all powers not specifically provided to local

governments by the state constitution or legislature are reserved for the state. Many states have

structures of governmental power that lie somewhere between the two extremes. Governmental

power restrictions can affect the ability of localities to issue debt, create new revenue sources,

sign regional agreements, issue contracts for services or enter into private partnerships.

Some states also have specific constitutional requirements concerning the state and local

issuance of debt. Many states require that different forms of state debt issuance be approved by

public referendum. South Carolina is an example of a state that requires local government debt

issuances to be approved by the state prior to the sale. Many states have provisions that limit the

total amount of debt that the state, or a community in the state may have outstanding. This

amount is most often limited to a specific percentage of the assessed value of property in that

jurisdiction. Arkansas even has a state constitutional requirement that no state or local debt

may be issued which will have an interest rate above a certain percentage. These constitutional

limits on debt issuance may hinder the ability of state and local governments to provide needed

improvements.

In several state constitutions there are also provisions that limit the ability of local

governments to pay for infrastructure improvements out of own-source revenues. These

restrictions have an effect on infrastructure provision by limiting aspects of revenue collection

and which increases the competitive pressures from governmental operating requirements. The

most common forms of restriction place limits on property tax levies or assessments, or on the

property or other tax rates. Proposition 13 in California and Proposition 2 1/2 in Massachusetts

are examples of these forms of barrier.

Statutory and Regulatory Barriers

There are statutory and regulatory impediments to infrastructure provision at every

level of government. At the federal level, there are restrictions that serve to significantly drive

up the cost of infrastructure facilities that are debt-financed. The Tax Reform Act of 1986, and

earlier federal actions, contained numerous provisions that have hindered state and local

governments from efficiently using tax-exempt debt for infrastructure improvements. Many of

these actions, such as the severe limitation on banks' ability to deduct the purchasing and

134
carrying costs of tax-exempt bonds and the imposition of the alternative minimum tax on certain

tax-exempt securities, have had the effect of lowering the demand for tax-exempt debt which

results in higher interest rates for the issuing governments. Other changes in the Tax Reform

Act, such as the state volume cap and private-use test, which is described elsewhere in this paper,

have forced issuers to substitute taxable debt for tax-exempt debt, which incurs significantly

higher debt service requirements. The statewide volume caps limit the amount of "private

activity" tax-exempt bonds that may be issued within a state in any given year to the greater of

$50 per capita or $150 million. This means that tax-exempt debt for certain infrastructure

projects such as facilities for solid waste disposal must compete with other tax-exempt debt such

as mortgage revenue bonds and bonds for multifamily rental housing in order to obtain an

allocation under the volume cap. The only solid waste disposal facilities not subject to the

volume cap are those that are entirely government owned.

In addition, there are increased administrative costs of issuance associated with other

tax law changes such as bond registration and the arbitrage rebate requirements that have

prompted governments to eliminate or postpone improvements. The bond registration

requirement, enacted in the 1982 Tax Equity and Fiscal Responsibility Act, closed down the

ability of state and local governments to issue bonds in bearer form. The arbitrage rebate

requirement, enacted as part of the 1986 Tax Reform Act, mandates that any income derived

from the investment of bond proceeds that exceeds the yield on the bonds (known as "arbitrage

earnings") must be "rebated" to the federal government. While there are exceptions to the

requirement, one of which is described elsewhere in this paper, nevertheless the administrative

costs associated with calculating and tracking bond proceeds and yield restriction where

required by law or necessary to avoid rebate payments, place a tremendous financial burden on

state and local governments.

State regulations may also provide barriers to infrastructure provision. The

governmental power restrictions discussed earlier are particularly applicable at this level. The

ability to initiate new revenue sources for infrastructure provision is an important at this time,

and in several states that ability is limited by a requirement for authorization from the state

government. In other states, Massachusetts is an example, the state control over the assessment

process also has repercussions on a community's ability to raise revenues, due to limitations on

the tax base.

Local governments are impeded by state regulations concerning purchasing and cash

management. Some states have very conservative policies concerning the investment of public

135
funds, these have the effect of lowering the amount of interest revenue localities can earn. In

Georgia, the state constitution has provisions that will not allow localities to sign contracts for

services, including construction, until the full cash amount required is on hand. Such an

arrangement significantly lengthens the period of time between the decision to construct an

improvement and the completion of that project. Even though some relief from the arbitrage

rebate requirement described above was enacted in 1989 in what is known as the "2-year spenddown" provision, the Georgia constitutional requirement makes it difficult, if not impossible,

for the state and its jurisdictions to take advantage of the provision. Under this provision,

arbitrage earnings on bonds issued for certain construction projects need not be rebated to the

federal government if the bond proceeds are spent according to a certain specified schedule

within two years of the issuance of the bonds. For certain construction projects, two years is not

enough.

State laws can also impede local governments in their issuance of debt. Many of the

public referendum requiremnents are mandated at the state level. The state also may set

regulations that limit the amount of debt that may be issued by localities. State governments

have promulgated regulations concerning the security, method of sale, and structure of

municipal debt that have the effect of driving up borrowing costs or creating other inefficiencies

in the process. In Virginia, for example, the state government must approve all advanced

refundings of local debt, based on specific criteria that it has established. This form of state

regulation limits the flexibility of local governments to meet their infrastructure, as well as,

operating requirements.

State regulations sometimes also limit the ability of local governments to enter into

agreements with other jurisdictions and private concerns. This can be especially true when

agreements have to cross state or national lines. Domestic content preferences ("Buy

American") or similar state business preferences, and minority contracting rules can make

regional or public-private cooperation more difficult. As an example, the Rappahannock and

Potomac Transportation Commission is in the process of inaugurating a commuter rail system

for the Virginia suburbs of Washington, DC. State and federal regulation has made the

negotiations with Washington, three private and semi-private railroad companies, the Boston

MTA (for temporary supply of cars), and the Brazilian car manufacturer very difficult and has

set back the timetable for opening by over a year.

At the local level, city, county or district charter restrictions may limit the ability of

governments to meet their infrastructure needs. These charter restrictions, along with other

136
local resolutions, may create the same problems with debt issuance, purchasing, contacts, and

revenue collection that have been discussed from the state level. Local governments often adopt

fiscal policy documents and resolutions that restrict successor governments from efficiently

meeting infrastructure needs. As an example, in the early 1980s,..for purposes of maintaining

credit quality, many localities adopted debt policies that stipulated that the ratio of debt per capita

would not rise above $1,000. This level, while appropriate for the time, is too rigid a benchmark,

and adherence to that level has inhibited some governments from financing needed projects,

although that financing would have no negative impact on the localities' creditworthiness.

Economic and Financial Market ImDediments

Current economic conditions have placed severe barriers in the way of governments

attempting to meet their infrastructure requirements. Governments are facing great reductions

in revenues from a variety of sources. Rising unemployment has slowed income and sales tax

receipts for many jurisdictions. Negative trends in real estate values, weak new home

constru'ýtln, and large regional pockets of overbuilt commercial property have limited property

tax collect•,-•, witi, sharp repercussions for local governments, and especially for special

assessment districts.C. Oe of the few bright spots for governments has been the decline in interest

rates, yet this has an ad 'erse impact on revenues in view of the resulting declines in interest

earnings for local governments. When the reductions of intergovernmental aid discussed

earlier are factored in to the picture, the stagnation or outright decline of local governments'

revenue bases is evident.

Governments are under increasing expenditure pressures as well. The current

recession has added to the demand for social services, even as governments, especially at the

state level, are reeling under the effects of over a decade of rapid growth in health and retirement

expenses. The increasing costs associated with unfunded federal and state mandates have

added significantly to fiscal stress. With both rising expenditure requirements and declining

revenues, local governments are hard-pressed to meet current operating requirements, and have

little flexibility left for financing infrastructure, even when some systems are in dire need.

Political Impediments

The final set of barriers to state and local infrastructure financing are the practical,

political ones. Political pressures often result in short-term solutions to long-term structural

problems. There is simply very little incentive for political leaders to take a pro-active approach

to infrastructure. As an example, an East Coast resort city has had a history of very high

137
population growth over the last three decades. This has created extreme pressure on some

environmental systems, especially on its water supply, which was being purchased from a

neighboring city. That neighboring city had issued warnings for years that the water supply was

going to become inadequate, but the resort city's leadership chose-to ignore the danger signs.

With the contract for water from the neighbor set to expire shortly, the resort city is currently

faced with either a project to pipe in water from another state, sixty miles away, which would be

extremely litigious; a crash desalinization program; or to commence a water rationing

program. Cooperative regional approaches to this problem were proposed fifteen years ago, but,

short-term vision has ruled the day.

Current economic conditions have created a particularly cautious citizenry, with the

result that it is exceptionally difficult to increase revenues by increasing taxes. Tax revolts

have surfaced in several states, and the political repercussions in states like Michigan and New

Jersey have been abundantly clear to political leaders nationally. This charged climate will

make raising revenues for infrastructure provision extremely difficult. On the other hand,

voters in some Massachusetts communities have approved increases in the tax levy to defray

school and infrastructure costs. Many opinion polls have found that citizens are often supportive

of limited tax, fee or toll increases when the revenues are mandated for specific infrastructure or

educational uses. And surveys by the Advisory Commission on Intergovernmental Relations

have consistently shown that local governments, the level closest to the citizenry, is the most

popular.

While some form of public-private partnership for infrastructure provision is one of the

attractive new solutions, there are political, statutory and economic difficulties in implementing

these solutions. A provision of the Tax Reform Act of 1986, for example, (the "private-use test")

requires that for a bond to be tax-exempt, no more than 10% of the proceeds of the bond may be used

by any private business, and no more than 10% of the principal or interest is secured by private

business. Prior to 1986, this test was 25%. While certain facilities are exempt from this

restriction, such as governmentally-owned airports and docks and wharfs, the restriction has

severely curtailed the ability of state and local governments to enter into public-private

partnerships for the provision of certain infrastructure facilities. For example, tax-exempt debt

could not be issued for a privately-owned road if the private business use limits were exceeded.

A close relationship between government and business can result in policies that create

unease, criticism, and sometimes litigation by environmental and labor groups. At the same

time, many of the private concerns that were very attracted to infrastructure improvements when

138
the economy was growing are now faced with severe problems of their own. Proffers, exactions,

and other developer contributions for infrastructure were available a few years ago, but, now the

developer or the businessman may be looking for governmental assistance rather than helping

to pay for public infrastructure.

Conclusion

The discussion of the barriers to infrastructure finance has presented a somewhat

dismal picture, however, this discussion does serve as a step towards governments taking the

pro-active approach that has been missing. Clearly, infrastructure financing has changed over

the last several decades, with the rise and decline of federal involvement and the increasingly

debt-financed state and local government efforts. But the dimensions of the problem have

continued to steadily expand. The eventual solutions will have to come through the involvement

of all levels of government, as well as an educated commitment by the citizenry and business.

While state and local governments have borne the brunt of infrastructure provision, at

the federal government level, there finally appears to be a growing awareness of the importance

of infrastructure and national economic health. The various studies linking infrastructure

provision and worker productivity have drawn particular attention. As a result of this increased

awareness, initiatives such as those contained in the Intermodal Surface Transportation

Efficiency Act of 1991, the current efforts on an economic stimulus package in Washington, and

Congressional interest in proposals such as GFOA's Mandated Infrastructure Bonds (MIFs)1I

indicate that some progress is possible and that the national, and specifically federal

commitment, to infrastructure may finally be changing for the better.

1 The Government Finance Officcrs Association's Committee on Governmental Debt and Fiscal Policy has

proposed that a new category of municipal debt, known as "Mandated Infrastrucaure Bonds," be created. These

bonds would be issued by governments for projects mandated by federal laws such as the Clean Water Act,

Clean Air Act, Resource Conservation and Recovery Act and others. These bonds would be fully qualified taxexempt bonds and would be exempt from certain restrictive provisions of the Tax Reform Act of 1986.

Specifically, they would be "bank qualified" so that banks could deduct 80% of the cost of purchasing and

carrying them, and be subject to the pre-1986 25% private use test rather than a 10% test. They would also be

exempt from the statewide volume caps and the arbitrage rebate requirement. All of these would have the

effect of lowering issuance and debt service costs for the issuing governments and increase the number of

infrastructure facilities that could be provided.

139
Table I

Sources of Funds for State and Local Government Fixed Capital Formation

1955 - 1990

(Aggregate amounts in billions) (As apercent of Fixed Capital Fonnation)

FIXED

CAPITAL FEDERAL DEBT CURRENT FEDERAL DEBT CURRENT

YEAR FORMATION GRANTS FINANCED RECEIPTS GRANTS FINANCED RECEIPTS

1955 10.3 0.8 5.3 4.2 7.8% 51.5% 40.8%

1956 11.6 1.3 5.3 5.0 11.2% 45.7% 43.1%

1957 12.9 1.8 5.3 5.8 14.0% 41.1% 45.0%

1958 13.9 2.3 5.8 5.8 16.5% 41.7% 41.7%

1959 14.3 2.8 6.5 4.9 19.7% 45.7% 34.6%

1960 14.3 3.3 6.7 4.3 23.1% 46.9% 30.1%

1961 15.5 3.7 6.9 5.0 23.7% 44.3% 32.0%

1962 16.3 - 0 7.0 5.3 24.5% 42.9% 32.5%

1963 18.0 4.3 7.8 5.9 23.9% 43.3% 32.8%

1964 19.5 4.7 8.6 6.2 24.1% 44.1% 31.8%

1965 21.4 5.0 9.5 6.9 23.4% 44.4% 32.2%

1966 23.8 5.4 9.9 8.5 22.7% 41.6% 35.7%

1967 26.0 5.8 11.2 9.0 22.3% 43.1% 34.6%

1968 28.5 6.2 12.6 9.7 21.8% 44.2% 34.0%

1969 29.2 6.6 13.3 9.3 22.6% 45.5% 31.8%

1970 29.8 7.0 14.3 8.5 23.5% 48.0% 28.5%

1971 31.5 7.8 17.1 6.7 24.7% 54.2% 21.1%

1972 32.2 8.5 19.2 4.4 26.5% 59.7% 13.8%

1973 34.7 9.3 19.3 6.1 26.8% 55.6% 17.6%

1974 41.2 10.1 18.2 12.9 24.5% 44.2% 31.3%

1975 42.5 10.9 19.4 12.2 25.6% 45.6% 28.7%

1976 40.4 13.5 19.3 7.6 33.4% 47.8% 18.8%

1977 39.6 16.1 20.5 3.0 40.7% 51.8% 7.6%

1978 46.6 18.3 21.5 6.8 39.3% 46.1% 14.6%

1979 49.4 20.0 22.0 7.3 40.5% 44.6% 14.9%

1980 54.9 22.5 21.2 11.2 41.0% 38.6% 20.4%

1981 53.0 22.1 19.9 11.0 41.7% 37.5% 20.8%

1982 51.5 20.5 25.6 5.5 39.8% 49.6% 10.6%

1983 51.5 20.5 27.2 3.8 39.8% 52.8% 7.4%

1984 59.4 22.7 30.2 6.5 38.2% 49.2% 12.6%

1985 64.0 24.8 33.2 6.0 38.8% 51.9% 9.4%

1986 76.2 26.2 38.2 11.6 34.4% 50.1% 15.2%

1987 82.2 23.8 42.5 15.9 29.0% 51.7% 19.3%

1988 89.9 24.6 47.5 17.8 27.4% 52.8% 19.8%

1989 94.7 24.7 51.0 19.0 26.1% 53.9% 20.1%

1990 109.0 25.2 60.0 23.8 23.1% 55.0% 21.8%

Source: Data derived from Bureau of Economic Analysis' National Income Product Accounts

140
Table 2

Public Construction, 1964 - 1990

(in millions of dollars)

Total State

and Local Total Federal

Calendar Total Public Highways and Sewer Water Supply Public Public

Year Construction Streets Systems Facilities Other Construction Construction

1964 S20.203 S6,960 $1,325 $956 $7.244 $16,485 $3,718

1965 21.920 7.381 1,195 1.266 8.206 18.048 3,872

1966 23,846 8,157 1,300 1,066 9,520 20,043 3.803

1967 25,377 8,347 1,058 1,270 11,386 22,061 3,316

1968 27.437 9,088 1.551 1.541 12.058 24,238 3.199

1969 27.793 9.039 1,342 1,336 12,926 24.643 3,150

1970 27.908 9.728 1.543 1,093 12,434 24,798 3.110

1971 29.699 10.369 1.829 997 12,694 25.889 3,810

1972 30,030 10,130 1,700 1,077 12,879 25,786 4,244

1973 32,348 10.236 1,954 1,067 14,391 27,648 4,700

1974 38,133 11.808 2.681 1.381 17,172 33.042 5,091

1975 43.293 12.840 4,175 1,535 18,655 37.205 6,088

1976 43.969 12.032 4,704 1,442 19,008 37,186 6.783

1977 43,082 12.064 4,269 1,441 18,220 35,994 7,088

1978 50,146 13.748 5.275 2,074 20,903 42,000 8,146

1979 56.645 16.560 6,027 2,056 23,438 48,081 8,564

1980 63,645 17.753 6,775 3,082 26.394 54,004 9,641

1981 64,691 17,625 5,949 3,011 27,693 54.278 10,413

1982 63,064 18,217 5,771 3,024 26,044 53.056 10,008

1983 63,450 18.442 5,601 2,219 26,631 52,893 10,557

1984 70.217 20.285 6,357 2,667 29,668 58,977 11,240

1985 77,824 23.647 6.960 2,580 32,633 65,820 12,004

1986 84.593 24.916 7.654 3.183 36,428 72,181 12,412

1987 90,628 26.668 8,982 3,667 37,259 76.576 14,052

1988 94.782 28.797 8,818 4,000 40,903 82,518 12,264

1989 97.855 27.732 9,405 3,999 44,356 85.492 12,363

1990 108,657 30.337 10,403 4,973 50,590 96,303 12,354

Source: Value of New Construction Put in Place: May 1991. U.S. Deparitment of Commerce, Bureau of the Census,

Washington DC.

141
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LEGAL IMPEDIMENTS TO INNOVATION

IN REBUILDING AMERICA'S CRUMBLING INFRASTRUCTURE

CHARLES F. SEEMANN, JR., PARTNER

DEUTSCH, KERRIGAN & STILES

The United States faces a crisis, as its aging infrastructure, serving well beyond

its life expectancy, deteriorates to failure. Much of the infrastructure is over a

century old--bridges, water and sewerage systems and the like; it is a tribute to

American technical prowess of the last century that the infrastructure continues to

function at all, much less provide major service. Pause a moment to recall that the

now moribund infrastructure was, at its creation, a triumph of American innovation.

America needs a resurgence of that innovation now to solve the

infrastructure problems that threaten significant economic and personal dislocation.

Unhappily, there are impediments to such innovation; this paper dwells on some of

those created by the interrelation of the law with engineering and the practical process

of construction.

A. Historical Perspective

Most modern construction contracting, particularly public works,

is an arrangement of three parties: the Owner, the Designer and the Builder (or

Contractor).' Typically the Owner contracts with a Designer to provide plans and

specifications that detail the finished project; and the Owner contracts separately with

the Contractor to build precisely what those plans and specifications detail. The roles

of Designer and Builder are not inherently separate, but they are today by contract

usually deliberately discreet. The Designer provides the design and inspects the

project periodically to confirm that the work generally conforms to his design; he

eschews control of, or responsibility for, the means, methods, techniques and sequences

of construction, for job-site safety on the project site, and generally for the specific

Each of these entities is, in practice, usually a team, or chain of other entities. For

example, the lead Designer who contracts with the Owner, e..g., architect for a

building, usually subcontracts for required specialty design, such as soils, mechanical

and electrical work. Similarly, the prime Builder will subcontract discreet parts of the

work to subcontractors. The Owner's interest may likewise be divided among several

parties, including lessors/lessees and lenders. For simplicity, this discussion uses the

singular to refer to the three major, or lead, performers; but, in general, the notions

expressed here frequently are relevant to the other actors.

143
requirements of construction; those are left entirely to the Contractor.

This contrasts with historical practice; in medieval times, and until

relatively recently, the roles of Designer and Builder were fused in the Master Builders

of the great cathedrals, 2 a model that persisted through the 19th Century.

For example, the Brooklyn Bridge, a paradigm of engineering

innovation was designed by John Roebling as Chief Engineer3; when he died at the

beginning of construction, his son, Washington Roebling, took over as Chief Engineer.

As Chief Engineer, Roebling was involved in the work in a direct way that modern

Designers usually do not; he participated directly in solving problems of construction

technique, method and sequencing, which today would be left to the Builder. There

has, at least in this respect, been a change in how things are built.

The current system, in which the roles of Designer and Builder are

separate and distinct, is a relatively recent development. In this system the Designer

prepares detailed plans and specifications which describe the finished project very

specifically. Then (usually in commercial projects, and almost invariably in public

projects) the specifications are advertised for letting to the lowest responsible bidder.

The low-bidder Builder constructs the Project while the Designer's

participation is limited to certifying to the Owner that construction is done in

accordance with the drawings and specifications. The Builder is usually solely

responsible for means and methods, sequences and techniques of construction.4

2 A very readable novel describing in the practical terms the construction process of

that time, is in Pillars of the Earth, by Ken Follett. The novel also described the

evolution of the construction of the cathedrals, particularly the trial and error of

innovations that evolved into the soaring arches and tall windows. See also J.E.

Gordon, Structures. or Why Things Don't Fall Down (1978), pp 210-215.

3 At the time its central span of 1595 feet was then the longest single span ever built.

It was the first suspension bridge of steel, stronger than lighter than iron; and the

steel wire was zinc galvanized to prevent rust. It functions today carrying loads much

greater than those contemplated by its designer.

4 In recent years the design-build concept, a modern refusion of design and

construction responsibility, has grown in the commercial world. It has also increased

in federal public works. See "ASCE Advocates Pre Qualifying for Federal Design

Build Jobs," Engineering News - Record, April 27, 1992, p 7. But it is almost

unknown in state and local public works, where most infrastructure replacement must

occur.

144
There has been another change in the last century, life has become more

valuable in the literal sense, which has changed how we build things. Because

diseases and then-dangerous conditions regularly killed the young 5, society in general

was less concerned about the sanctity of individual lives. For many people, particularly

in the laboring class, life was, and as Hobbs put it, "poor, nasty, brutish and short."6

In the first half of the 20th century, there was a burst of discovery that changed the

face of medicine; discovery of antiseptic agents, antibiotics, and medicines, coupled

with improvements in surgery and public health, combined to raise the life expectancy

of the average American male from 46.3 years in 1900, to almost 75 years in 1986.7

As mankind was subduing most of the causes of early death, there was a progressive

surge that sought to improve the lot of the common man. These forces combined to

elevate concern over the social cost of industrial death and injury; this led in turn to

workmen's compensation laws, which allocated the cost of such death and injury to the

iiý istrial process itself through insurance premiums, to be passed on to consumers in

the cost of goods. In later years the expansion of tort law has further added cost to

my construction practice which injured people.

This change in attitudes militated against taking chances, including

innovations in construction design and technique, which might involve risk to human

life and limb. Technical innovation without regard to human safety on any large scale

is over.

An additional legal problem for innovation is that science and technology

are, to some extent, victims of their own good publicity. In the late 19th century years

of effort to apply the discoveries of empirical science in a systematic way culminated

5 When the Brooklyn Bridge was finished in 1883, the world had just begun to accept

the notion that infection could be prevented by cleanliness and antiseptic agents.

Semmelweiss' discovery and publication of his findings occurred in the 1840's and

50's, but wx re not widely known in America until after our Civil War. The concept

of surgical sterility as we now think of it was not known during the American Civil

War. It would be another fifteen years before Walter Reed and others established

that insects were vectors for the communicable diseases which seriously shortened

the average life span. And so on.

6 Thomas Hobbs' Leviathan Part 1, Chapter 13.

7 Life Insurance Fact Book, 1976, American Council on Life Insurance, page 89. The

World Almanac.

145
in the birth of engineering as the profession we have today.8 Thereafter, engineering

progressed rapidly as a profession applying mathematics and empirical science with the

impressive success. Everyone came to accept that engineers could, and should, be

able to calculate very accurately all that needed calculating. There is today a popular

conception that scientists can do almost anything they want to; most don't understand

that technology has always had frontiers, the "edge of the envelope", and that progress

in all ages requires exploring beyond the edge of the envelope.

B. The Legal Problems

Against the background of those observations, we turn to the principal

problem which deters innovation in the construction process: What happens if the

project doesn't work and is useless to the Owner; worse still, what happens its failure

maims or kills someone?

As a general proposition, whoever is damaged by such a failure now

almost invariably sues everybody, seeking recourse from any source possible.

Legal responsibility, and consequent fiscal liability for damages, under

such circumstances can arise from several sources: (a) Liability can be imposed or

assumed by contract; that is, a party may by contract undertake a duty to do or not do

something; and if he violates that duty, he becomes liable for damages caused by the

breach; 9 (b) The duty can be imposed by statute, that is the law requires people under

certain circumstances to do (or not do) things, and if they break them and the breach

8 Engineers on the continent had earlier begun coupling mathematical analysis with

empirical experimentation to solve engineering problems; but in England and

America, engineering was dominated until the middle of the 19th century by "practical men" who regarded as useless theoreticians who dabbled in mathematics.

J.E. Gordon, Structures, Or Why Things Don't Fall Down, (1978), pp 61-65, 179-181.

9 This is to some extent an oversimplification. Many duties or responsibilities are

legally allocable, so that parties can allocate the duty, and with it the responsibility

for failure in the duty. For example, the law is not concerned with surveying

responsibility so any party may agree to provide the side survey, be responsible for

providing field surveying controls and staking out the work. But on the other hand,

in some states a property owner owes a non-delegable duty to avoid using his

property in a way which will damage his neighbors; in addition any party undertaking

inherently hazardous activity through an agent usually cannot delegate responsibility

for damages caused thereby. See, for example, D'Albor v. Tulane University. 274

So.2d 825, (La. App. 1973) writ ref. (Property owner absolutely liable for pile driving

damage to adjacent property. Notwithstanding contractor's assumption of responsibility; owner did have indemnity right against the contractor if pile driving

negligent.)

146
causes damage they can be liable for that damage;'° (c) There is also a general duty

under most circumstances that people conduct themselves so as not, absent special

circumstances, to do anything which reasonable foresight indicates would cause

damage to another; failure of this general duty can create legal liability for damage

caused by the failure;" and, (d) An additional source of liability relevant here,

liability imposed strictly upon a party by law, regardless of fault of duty; for example,

in some jurisdictions, the owner of real property is absolutely liable to anyone

damaged or injured by a defect or disrepair in the property.'2

Most--including particularly lawyers not experienced in construction

matters--don't know, and construction professionals sometimes forget, that construction

contracting is largely a process of risk allocation; there are few immutable rules

imposing responsibility on particular actors in the process.'" Contracting parties thus

'0 See Palm Bay Towers Corporation v. Cram & Crouse, Inc, 303 So.2d 380 (Fla. App.

1974) Engineer held liable for damages resulting from failure to comply with city

ordinance requiring notification to city officials of design changes.

•' The key factor is foreseeability that the victim will suffer the specific harm from the

Designer's improper performance or non-performance of the duty. Compare, for

example, Howard v. Palmer & Baker Engineers, Inc., 302 So.2d 228 (Ala. 1974) (in

which possible damages from petroleum fires in as vehicular tunnel were held

sufficiently foreseeable that inspecting engineer liable for failure to recommend

proper equipment for fighting such fires) with Zeigler v. Blount Brothers

Construction Co., 364 So.2d 1163 (Ala. 1978), in which increase in utility rates not

sufficiently foreseeable from collapse of dam.

12 For example, See D'Albora v. Tulane University, discussed in note 9, supra. See also

Shepherd and Bourque, "Strict Liability in the Construction Context," 3 The

Construction Lawyer (No. 3) p. 3, Summer, 1982.

13 One such rule, rarely articulated with the bluntness used here, is that any party with

actual knowledge of a significant threat to human safety, who has some authority to

abate the threat or prevent the injury, must do what he can to protect life; failure to

do so will usually impose liability. In most standard contract documents Designers

have attempted to impose upon Builders all responsibility for compliance with safety

rules and regulations, j.e., assuring safety and protecting life and limb on the job.

However, most standard documents also make the Designer a contract administrator

with the duty to assure that the contract is performed in accordance with its terms;

if a Designer acquires actual knowledge that a Contractor is violating safety

standards in breach of the construction contract, the Designer ignores it and fails to

enforce the contract terms, he does so at his peril. The Kansas Supreme Court held

a Designer to have such a duty in Balagna v. Shawnee County, 668 P 2d 157 (Kansas

1983). Compare, however, Fox v. Jenny Engineering Corporation, 505 N.Y.S. 2d 270

(App. Div. 1986), and Conti v. Pettibone Companies, Inc., 445 N.Y.S. 2d 943 (Misc.

1981), in which a Designer's general duty of inspection, without specific responsibility

147
allocate known risks among themselves.

Innovation, the use of new or not-yet-used technological solutions to

practical problems, is per s a risk; the new solution might not work, or work as well

as older methods. The question is, whose risk? As a practical matter, local

government entities responsible for most of the infrastructure are rarely interested in

anything more than the cheapest and surest fix for a problem. They are rarely anxious

to be on the cutting edge of technology, and never want to bear the consequences of

failure.

Of course, in the larger sense, almost every contractual undertaking in

construction is a risk; perhaps the biggest risk is the Builder's promise to complete

the project for a fixed price within a fixed time. The contractor "guarantees" his

performance, in spite of all the risks that might prevent performance.14 The reason

he takes those risks is simple: Profit. A contractor estimates what it will cost him to

do the work, usually adds an amount for risks or contingencies, and profit on top of

that. If his cost estimate is accurate, and he is reasonably lucky on the risks, he can

make money.

Innovation is a risk; and the greater the innovation, the greater

the risk. Contractors use innovation where appropriate, for the same reason they take

the risk of contracting in the first place, for profit; a contractor who can dramatically

enhance his profits by finding and using some new or better technique will do so.

There is evidence that this sort of innovation is alive and well in construction.' 5

But, there is likely to be less innovation in the design process, and that

is the focus of this paper.

for safety, or authority to supervise and control, held sufficient to make engineer

liable for injury to workmen. The comment in the text is meant to suggest that if a

design professional actually knows of or observes significant safety violations, and

fails to try to get them remedied, he might well find himself liable for the subsequent

injuries from that breach.

14 Such as weather, fluctuations in the price of labor, materials or in interest rates, the

health of his key supervisory employees, the financial stability of subcontractors and

their ability to meet their commitments, to name a few.

15 See, for example, "Home Built Scissors Lift Speeds Ceiling Installation," Engineering

News-Record, August 26, 1991, which was found in a random search of back issues

of that magazine, which frequently features such stories.

148
The question is why might there be less tendency to use innovation and

design, as opposed to construction. The reason is that not only is there no profit in

it, there is a profit disincentive.

Generally speaking a Designer must perform his contractual

undertakings in accordance with his standards of skill and care prevailing in his

particular profession in the same general area. 16 Typically, if a project fails or there

is a problem with it, in any subsequent lawsuit the designer's performance is thus

tested against the standard of care for that sort of work in the vicinity.17

Similarly in many states, it has been held that architects or engineers

have a general duty to the public wl-'ch can be anticipated to use the facilities being

designed and the care and skill which are used in making such projects safe for use by

the public are those generally prevailing among that profession in the vicinity.' 8

When a Designer is informed of his Owner-Client's goals, le., desires for

the completed project, the Designer has a duty to inform or advise the client if the

goals are incompatible, or unobtainable.19 And a Designer has a duty to "investigate

and advise" the Owner about all equipment, materials or design solutions the Designer

specifies; and his specification of such is assumed to be an assurance that the specified

material or equipment is satisfactory for the purpose specified.2 0 This latter duty can

be particularly burdensome, since rarely does the standard engineering fee on a

16 "One practicing a learned profession must do so with a degree of professional care

and skill customarily employed by others of the same profession in the same general

area. This standard has been held applicable to engineers." Bowman v. Coursey, 433

So.2d 251, 253 (La. App. 1983).

17 This standard must generally be proved by the testimony of an expert professional

familiar with standards in the area, City of Eveleth v. Ruble, 225 N.W. 2d 521

(Minn- 1974), although a court can find negligence from disregard of an ordinance,

Palm Bay Towers Corporation v. Cram & Crouse, Inc., supra, note 10, or from a

particularly egregious act, such as falsely certifying inspections which were not made,

City of Houma v. Municipal and Industrial Pipe Service, Inc. 884 F.2d 885 (5th Cir.

1989), or egregious omission, such as failing to size properly a water intake pipe at

a water treatment plant, City of Evele v. Ruble. supra.

18 Howard v. Palmer & Baker Engineering. Inc.. supra, note 11.

19 Rowe v. Moss, 656 S.W. 2d 318 (Mo. App. 1983)

20 White Budd Van Ness Partnership v. Maijor Gladys Drive Joint Venture, 778 S.W.

2d 805 (Tex. App. 1990) (Architect liable for failure of new tile product specified for

shopping center.)

149
routine infrastructure project fully compensate a engineer, particularly a small local

engineer to investigate one or more new technologies adequately.

Paraphrased then, it can be said that as long as an engineer or architect

designs his project the way most of the other design professionals in his area do, i.e.,

using tried and true material requirements and designs, he should not be held

responsible should there be some problem with the project later.

We have already seen that the process of construction contracting is the

process of accepting or transmitting risks. But why, one might ask, would engineers

be less willing to take the risk of innovation if contractors are. The answer, again, is

profit, or lack of it.

Over the years there has been consistent pressure to reduce the fees of

design professionals as one way of cutting the overall cost of new projects. In earlier

times designers routinely charge substantial percentages of contract price as fees. The

fee covered not only design but, contract inspection and administration. But in recent

years there has been considerable pressure to reduce those fees.

Most engineers today feel that the fees have been reduced to the point

where engineers are cutting service to survive, so that the fees are absolutely

inadequate to compensate for any additional risk.

For there to be widespread innovation in this field, it will probably be

necessary first to convince the hundreds of small local government bodies, which are

responsible for most of the infrastructure, that innovation and experimentation are

desirable. No small order. That will include convincing these owners to accept all or

part of that risk, or to compensate the engineer for accepting it. Although this is

an area of speculation, the writer suggests that will be a hard sell.

However, once an Owner is determined to have advanced technology,

it can be handled in a number of ways. The Owner can require in the design contract

that the Designer explore innovative techniques, materials and equipment before

deciding on a design solution and report on them as part of conceptual design, to

allow the Owner consciously to decide what risks might be acceptable. It could also

provide profit incentives for the Designer, such as payment percentages of Owner's

savings from the use of innovation.

Some forward looking Owners and Designers will reach for such

solutions without additional incentive; but in the writer's experience, most small local

government entities, and their regular Designers are risk-averse. They prefer time

tested solutions to a problem, with little desire to reach for the brass ring of future

savings or benefits.

Perhaps the federal government could provide some impetus to

innovation, through the enormous leverage it enjoys from grant financing of much of

150
the infrastructure work. This incentive could take several forms. For example, there

would be "innovation grants" un~der which concepts qualified as true innovations, could

be performed with the government agreeing to accept all or part of the risk of the

failure of the innovation. Coupled with, and added to such a grant program, federal

agencies could, based on empirical data from innovation grants, develop standards

which would hasten the acceptance of innovative solutions into the mainstream, i.e.,

make the innovation acceptable to designers practicing in a particular specialty, i.e.,

part of the norm. A problem with this, however, is that most federal civil servants who

administer such programs tend to be as risk-averse as most local government officials.

On balance, it seems unlikely that there will be any surge to accept

innovative technologies. Good people will continue to build better mouse traps, and

the best of these mouse traps will, sooner or later, find their way into the mainstream.

But one suspects that the country will, in the main, lose countless benefits-savings

enhanced performance, and the like-from delayed use of the innovative technology.

15 1
Innovation and Technology Transfer Opportunities:

Industry/University/Government Partnerships

William D. Michalerya, P.E.

Manager of Industry Liaison and Technology Transfer

NSF Center for Advanced Technology

for Large Structural Systems (ATLSS)

Lehigh University

Bethlehem, Pennsylvania

Innovation, technology transfer, and competitiveness issues

are receiving more attention recently, and with good reason.

Clearly to be competitive on a global basis, the United States

must innovate and move technologies to practice more effectively,

as well as rebuild the national infrastructure. This paper will

explore opportunities from the perspective of a university research center created to enhance the competitive position of the

large structures and construction industries through the development and implementation of advanced technology. Large structures

include bridges, buildings, offshore structures, and other major

infrastructure facilities.

The ATLSS Center was established by the National Science

Foundation in 1986 with a mission in four areas: research, education, industry collaboration and technology transfer, and large

scale experimentation. ATLSS is one of nineteen Engineering

Research Centers currently funded by the National Science Foundation. The emphasis on the industry partnership is an important

requirement and was clearly seen as a mechanism to enhance innovation and technology transfer.

Engineering Research

Centers

••'•Ui @ersities'

FIGURE 1

153
Industry and Government Participation in the Research Program

Industry and Government participation is critical for a

research program which meets the needs of industry and which will

be accepted and implemented in practice.

Several mechanisms are used to enhance industry participation, including an Industry Advisory Council, Project Advisory

Panels, workshops, one-on-one contacts, and industry-funded

graduate study. Participation levels annual partnership support,

specific project funding, and technical include advisory roles.

The Industry Advisory Council, composed of representatives

from General Partners and invited advisors, meets twice per year.

These meetings have several purposes:

"o To update industry partners and advisors on research progress.

"o To solicit input on the direction of the research program.

"o To address specific issues to enhance interaction with

industry or the research program.

"o To enhance technology transfer by early involvement of the

users of the ATLSS research and to develop technology transfer teams.

These Council meetings are designed to be an interactive

forum to encourage effective dialogue between our researchers and

industry. In addition to plenary sessions and presentations on

ATLSS research projects, project panel meetings are held, typically on the day preceding the main meeting. These project panel

meetings bring together the ATLSS researchers, students, industry

partners, and invited industry experts.

Technology Transfer

A unique opportunity for an Engineering Research Center to

implement its results lies in the early and continuous involvement of industry in the research program. Such industry involvement allows early assessment of results, provides continuous

guidance so that industry issues are being addressed, and establishes an early "buy-in" of the technology user to facilitate

acceptance and implementation. The key to transferring technology

is the "adoption and diffusion" process which clearly depends

upon the active role of the user. The successful transfer requires a "demand-pull" from the user of technology, rather than a

"technology-push" in which the developer of technology seeks out

users of the technology after its development. The Industry Advisory Council, Project Advisory Panels, Short Courses, and Workshops are vehicles to develop the "demand-pull" from the user

community.

154
Technology Transfer Plan for Each Project

As part of the project planning process, each ATLSS project

now has a Technology Transfer Plan which includes as a minimum:

"o End users of the technology, to be involved on the project

panel.

"o Identification of codes and specifications to be impacted by

the project. Formation of industry committees relevant to

the projects.

"o Description of other research work in the field, to assist

in collaborative efforts. (Industry, Government, and University.)

"o Timetable for transfer to practice.

"o Conferences, symposia or publications where papers should be

submitted.

"o If project is exploratory, identified fundamental contributions which could be made to advance procedures or processes

of current practice.

Project Activities

Industry and government collaboration are critical at the

project level. Several examples are discussed here.

The Bridge Fatigue Investigatoz@ is a knowledge-based system

developed to assist bridge inspectors in inspection of steel

bridges. At the recommendation of our Project Panel, follow-up

meetings were arranged for in-depth review of the program. In

addition, a presentation was made at the Seventh International

Bridge Conference in June, 1990. The audience consisted of 450

practitioners, transportation officials, and academics, with an

emphasis on practical problem solving. In May, 1991, an additional presentation was made to the Bridge and Structures Subcommittee of the American Association of State Highway and Transportation Officials (AASHTO), introducing BFI to the national user

community. Bridge Engineers from all 50 states participate on

this subcommittee. AASHTO has a mechanism to develop and maintain

software related to highways and bridges. Several demonstrations

to the Federal Highway Administration have been encouraging for

incorporating BFI into the FHWA Demonstration Project program.

Additional development steps were identified at these meetings,

including the inclusion of Hypermedia applications. A Technology

Transfer Plan has been developed to complete development and

implement BFI in practice.

The Corrosion Monitor is an electro-chemical device developed to monitor corrosion of steel on bridges. The project has

advanced under two years of field studies and further research

partially sponsored by the American Iron and Steel Institute

(AISI). AISI has agreed to continue funding for a third year, but

this will be the year for a larger consortium effort to be

launched. An implementation plan has been developed to move the

project into practice, including acceptance by standards and

155
specifications groups such as AASHTO or ASTM. One of the reasons

that this project has this potential is that a technology transfer team was established early and Bethlehem Steel has been

active in assisting in the transfer. (See Figure 2.) A proposal

for further funding was also submitted to the Federal Highway

Administration after a meeting there in June 1991. The topic of

corrosion has been identified as a high priority in the FHWA

Structures Research Program. A patent (U.S. Patent No. 5,045,775)

was issued in September, 1991, for the Coulometer, further

strengthening the ATLSS position in transferring the technology

to practice.

CORROSION MONITOR

TECHNOLOGY TRANSFER TEAM

Needs & Technology Technology Fund. & Develop.

Developers Users Agents

ATLSS PENN DOT

BETH STEEL MICHIGAN DOT AISI

USX NJ TURNPIKE BETH STEEL

ALCOA N

Codes & Manufacturer

Standards & Distributor

AASHTO

ASTM CHANT

FHWA

FIGURE 2

156
The ATLSS Integrated Buildings System has generated significant interest from practitioners and the National Institute of

Standards and Technology (NIST). The dual-pronged approach of an

automated crane platform (Stewart Platform) plus the development

of new structural connections offer an opportunity to implement

an entire system for automated construction of steel framing

systems. (See Figure 3.) In addition to project meetings at the

ATLSS Center and meetings with NIST, three fabricator/erector

companies have expressed interest in working with us, and we are

planning to develop a consortium to launch a demonstration project in the field.

ComputerFarct

Approach -Erect Large

Structural

Evaluate Systems

FIGURE 3

157
Competitive TechnoloQies, Incorporated

Recognizing the need to coordinate and expand technology

transfer activities within the Lehigh University research programs, a new wholly-owned subsidiary has been established, called

Competitive Technologies, Inc. (CTI). ATLSS is working closely with CTI to perform the following activities:

"o Develop and implement a comprehensive Technology Transfer

Plan for ATLSS

"o Develop consortia to transfer current technologies to engineering practice

"o Develop and implement specific commercialization plans for

ATLSS technologies

"o Manage our industry partnership relationships

"o Provide funding and other tools for implementation of new

technologies

"o Provide liaison to other Lehigh University technology

opportunities as well as other activities on a national and

international level.

CTI will assist the researchers in identifying potential innovations at our early stage and providing tools and mechanics

to effectively demonstrate and implement these innovations. The

industry and government participants are playing a key role in

these transfer activities as users and facilitators to enhance

the implementation.

Conclusion

The Engineering Research Center concept is one example of an

effective partnership among government, universities, and industry, providing continuous dialogue and participation of industry.

The emphasis on technology transfer assists in the implementation

of new technologies as part of the ongoing research program - not

as an afterthought. The National Science Foundation played a

critical role in creating the original structure, which has now

progressed to an effective partnership including leveraging of

funds through the private sector and other Federal Agencies.

These Centers could be considered as models to create partnerships and to encourage innovation and more efficient implemen- tation of new technologies for the public works infrastructure.

1 58
Technology Transfer (T) as a Work-Practice Change Process: An Essay

by

Jesus M. De La Garza

Assistant Professor of Civil Engineering

Virginia Tech, Blacksburg, Virginia 24061-0105

"To every action there is opposed an equal and opposite reaction." Technology

Transfer (T-) demands change and departure from a work-practice process that is intricately

woven into the professional and personal lifestyles of working individuals. For most working

people, continued job security and recognition are based on successfully achieving

predefined measures of performance. Individuals can easily construe the application of new

technologies to their work-practice process as a threat to the formula for obtaining success,

i.e., continued job security and recognition. Tinkering with an individual's professional

means to succeed can quickly propagate to the personal level, inducing anxiety and fear as

well as endangering an individual's personal lifestyle. The effort involved in absorbing and

conquering new technologies is likely to consume the time dividends distilled from efficiently

applying tested means and ways. Time dividends are usually applied to discretionary tasks

which are undertaken to precisely control and space out day-to-day schedules. Thus,

whether or not the fears of failure associated with change are warranted, reactions from the

individuals being affected by the adoption of new technologies should be anticipated.

Technology Transfer (T1`2) is good for your company. Top management has long

recognized that the individuals within an organization represent the single most important

financial asset. After all, if it were possible to r,;place everyone overnight, the company's

reputation and image, which largely form the basis for on-going business, are not

automatically carried over with the new work-force. T2 improves the individuals'

competence leading to an increase of assets which in turn leads to a better image and

reputation for a company. Thus, individuals at all tiers of the corporate ladder need to

believe that the adoption of new technologies is an important means to enhance the

performance of individuals, and consequently, the longevity of the company.

Corporate culture shock. Preparing for Technology Transfer requires not only

remolding individuals' attitudes towards change, but it also implies redefining the firm's

traditional organizational culture. Corporate cultures evolve over a period of time. They

are outlined by senior management, influenced by the market, and brought to existence by

the work-force. Corporate cultures manufacture postures, attitudes, and shields against

internal and external forces, only a few of which are real. Corporate cultures sanction workplace behaviors and set the stage for an organizational environment that is either

recalcitrant or conducive to innovation and Technology Transfer. Institutionalizing T2 and

Newton's third law; Essential Engineering Information and Data, Ganic, E.N., and

Hicks, T.G., McGraw Hill, 1991.

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innovation can cause an organizational cultural shift that induces a culture shock within the

work-force; this should be recognized, addressed, and p,,.<d out.

"Change is proportional to the force exerted against an object and to the time during

which the force is exerted."2 A Technology Transfer Task Force (T3F) represents the

engine that, if continuously fueled by top management, can provide the initial thrust to

launch an all-out cultural metamorphosis fostering tolerance for innovative change. The

charter of the T3F is to act as a permanent catalyst for innovation and T2. Permanent and

rotating memberships maintain the vitality, acceptance, and focus for the T3F. While

permanent members are needed to provide vision, continuity, and senior management

representation, rotating members are essential to ensure balance, undue bias, and workforce representation. The T3F main roles are two-fold: 1) to seduce top management to

distill a visible commitment to innovation and T2; and 2) to empower the masses to

constructively leverage the control they exert over the work-practice process. These roles

are achieved through awareness, motivation, and most importantly, involvement of decisionmakers and decision-takers.

"If an object is at rest, it will remain at rest, or if in motion, it will move uniformly

until acted on by some force."3 As top management promotes a corporate environment

conducive to T2 and innovation, individuals who are better challenged outside their comfort

zone will emerge from their dormant state to take on the roles of technology gatekeepers,

technology champions, and technology change agents. The gatekeeper is the individual who

identifies new technologies and envisions their implementation in the organization. These

individuals should have a high vantage point so they can better match emerging technologies

with the long term business objectives of the organization. Champions are the individuals

who risk not only committing resources to a technology, but also risk evaluating it and

persuading senior management to adopt or reject it. Should management decide to adopt

the new technology, change agents undertake the task of diffusing the technology through

the organization. While the technology gatekeeper should be a permanent member of the

T3F, the membership of the champions on the T3F should be transitory because there are

bound to be different champions for different technologies. Furthermore, representatives

of the group being impacted by the specific technology should also be transient members.

Dynamic membership in the T3F ensures that affected individuals are involved and aware

and that they avoid misconceptions about the technology, which could kill the T2 process

before it even starts. Sabotaging a T2 process for the wrong reasons is the ultimate triumph

of unmanageable corporate cultures. Interestingly, there will be individuals or groups within

any firm who will jump at the opportunity to try something new. A new technology can be

the springboard that is necessary to launch these individuals forward. Without it, they stand

little chance of getting ahead.

2Newton's second law; Essential Engineering Information and Data, Ganic, E.N., and

Hicks, T.G., McGraw-Hill, 1991.

3Newton's first law; Essential Engineering Information and Data, Ganic, E.N., and

Hicks, T.G., McGraw-Hill, 1991.

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In the end, one may find that there are three distinct groups in a company. They are:

the forward-thinkers group, the opportunistic group, and the masses. The challenge is then

to motivate, involve, and work with the masses who seem satisfied with the status quo.

"I'd be glad to improve myself," he said, "but I don't know how to go about it. What

shall I do?."4 Computer-Aided Drafting and Design (CADD) is a technology whose

application in the AEC industry can be utilized in all phases of the life-cycle process.

CADD technology has matured to the point where it is prudent to expect habitual and

sporadic owners to participate in the design process using CADD. That is, owners could

start communicating their vision of the project using specialized software packages built on

CADD platforms that let the owner express building concepts, performances, and

requirements.

A/E firms, on the other hand, have already been very progressive in their adoption

of CADD technology. Despite its primary utilization as a drafting tool, as opposed to a

drafting and design tool, CADD technology within A/E firms has been largely transferred.

As design evolves from schematic to preliminary and trom preliminary to detailed, the

continuous communication feedback with the owner can again be implemented in a CADD

environment. Are CADD-based designs better than pencil-based? They had better be.

Because making changes to computer CADD models is a relatively painless process, design

options in the later phases of the design process continue to be explored as vigorously as

they were in the earlier stages. When it is all done, however, the print or plot commands

are executed.

The easiness with which paper is produced using CADD software and hardware easily

matches the contractors' demands for paper plans and specifications. It is, however,

detrimental to the contractors when too many CADD layers are collapsed into a single

sheet, making it almost impossible to read the designs. This is certainly the result of a

technological mismatch between the design and construction professions. Unfortunately, this

occurs at a very critical junction in the AEC life-cycle process, which is far from being

seamless. Since CADD and the design industry have long passed the point of no return,

history will record that this technological differential contributed to the building industry's

accelerated adoption of CADD technology.

Why do we continue to demand plans and specifications in paper media?

Computer-based specification systems are evolving so rapidly that coupling specificationswriting software with CADD-based drawings is imminent. Write-Once-Read-Many-times

(WORM) technology can be readily utilized to centralize design changes and ease the

concerns of many people regarding the un-coordinating proliferation of sources of design

changes.

4Quote from Saggy Baggy Elephant by K.& B. Jackson, © 1947 by Western Publishing

Company, Inc.

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If one looks at the AEC life-cycle from the traditional perspective (design-> build

sequence), the pre-construction phase offers the contractor many opportun:es to utilize a

CADD model. For example, the contractor would benefit greatly from a CADD model

during the cost engineering phase because it can be utilized to perform automatic quantity

take-offs, costing, and pricing. The coupling of the Critical Path Method (CPM)

methodology with the 3-dimensional (3D) capabilities of CADD software can be used to

develop construction activity sequencings as well as construction schedule animations.

Constructability reviews is another pre-construction task which clearly benefits from the use

of 3D modeling capabilities. Simulating, visualizing, and animating construction methods

and activity sequences equals or supersedes the typical process of mentally building the

project.

During the construction phase, the contractor can generate CADD-based as-built

plans in real time. In doing so, the contractor and/or inspector can compare as-built

coordinates of critical objects with as-planned specifications. The advent of real-time x-y-z

positioning software and hardware means this task can be readily executed. Shop drawing

preparation, yet another construction task, has a prepare-submit-review cycle that the

CADD platform can enhance. Since design intent could be electronically embedded within

the CADD model, contractors or sub-contractors would have no problem in accessing it.

Periodic payment requests can be also automatically generated with the input coming from

as-built CADD models.

At the end of construction, as-planned and as-built CADD models can be transferred

to the owner of the facility for utilization during the operation and maintenance stages. This

closes the loop in which the owner receives a CADD model that can be interfaced with

commercially available or in-house developed software to perform facilities planning and

management. In this context, already matured CADD technology can be readily utilized,

becoming the common environment in which to communicate design requirements,

performances, intent, artifacts, changes, and as-built data. CADD technology is thus capable

of leveraging all phases of the life-cycle process; and last, but certainly not least, CADD

technology is capable of empowering the owner to optimize the facility aspect of their

mission execution.

Towards a paperless AEC industry. One can easily speculate and brainstorm other

applications for CADD. One of those future applications falls in the construction phase in

which the superintendent carries, still in his/her back pocket, a floppy disk containing the

plans and specifications. Should the superintendent need to look up a detail, he or she

would go to the nearest weather-proof visualization site station, insert the disk, call up the

desired drawing either with voice commands or with pen-computing technology, zoom in as

required, and yes, locally print a section of the details if paper is absolutely necessary.

V2 Flavors and V12 Mixins. If CADD technology has matured to the point that all the

tasks described above are now possible, and many more are within range, why has

technological progress not happened yet? Many researchers arid practitioners who have

studied the T2 process agree on the basic notion that the T2 process is a metamorphosis with

162
different evolutionary stages. Each of these stages has its own purpose, function, behavior,

players, barriers to overcome, dangers, and rewards.

Contrary to a predicable single metamorphosis process, one can envision an array of

T2 principles variations for the different key players of the AEC industry. That is, one size

does not fit all. Therefore, each of the T2 stages needs to be studied to determine viable

ways of performing it; I call this the development of "T2 Flavors". Each flavor corresponds

to an alternative, yet plausible, way of executing each individual T2 stage. Transferring a

specific technology to a specific AEC key player requires selecting T2 flavors from each of

the T2 stages; I call this the development of a "T2 Mixin". It is a forgone conclusion that

technology-dependent "T2 Mixins" need to be developed for each player in the AEC lifecycle process.

The uniqueness of the flavors and mixins terms conveys the idea that there is not a

single answer for every firm and for every technology. Instead, developing a variety of

options is needed to customize the best combination that fits the idiosyncracies of a specific

firm. This is just like going to the ice cream parlor and buying a gallon of ice cream (nonfat of course) made of one scoop of chocolate, two of vanilla, one of strawberry, and so on.

What you get is an ice cream mixin that suits your taste.

The AEC industry is at a crossroads. 'Where do we go from here depends a great

deal on where we wish to take the AEC industry, for if we do not care much, then it does

not matter which way we go.' 5 I have chosen an essay format style to summarize a few

Technology Transfer issues which in my opinion need further comprehension and

investigation. These issues with which I dealt are certainly not of my own creation or

postulation alone; they have been shaped by the contributions of many renown researchers

and practitioners over a period of time. The contributions made by Bob Tatum of Stanford

University, for example, have distilled formalisms, concepts and terminology which have

proven very relevant in our understanding of the intricacies and idiosyncracies of the AEC

industry players [Tatum 1986, 1987, 1988, 1989a, 1989b, Hansen 1989]. Generic models of

innovation development and deployment and their adaptations to the needs of a research

laboratory have provided the underpinnings for subsequent studies in the areas of innovation

and technology transfer [Rogers 1983, Shaffer 1985]. Furthermore, specialized technology

transfer models for expert systems have validated and expanded previous formalisms and

models [Bonnett 1989, De La Garza and Mitropoulos 1991, 1992, Feigenbaum, Nii and

McCorduck 1988, Helton 1990, Hester 1991, Mahler 1989, 1991, Matsuda 1991, Stretton

1991]. Developers of state-of-the-art software technology, as well as organized consumers

of it, have also confirmed technology transfer and innovation postulations made by

organizational behavior scientists [Cleveland 1991, Bowlin 1991, Moorhead 1989]. It is

interesting to notice how Buddy Cleveland of Jacobus Technology, for example, uses as

much space in his newsletter articulating the upcoming visualization software for the AEC

Industry as the roots and remedies of fear associated with automation [Cleveland 1991]. I

5Quote adapted from Alice in Wonderland by Lewis Carroll.

163
think this is a good sign. Developers of technology should be as sensitive to the issues of

T2 as the consumers.

Recommendations. In this section, I shall try to summarize the key issues with which

I dealt as well as outline areas needing further study.

a The winds of change are blowing. It is time to start making things happen

and stop watching and waiting while things happen.

0 Warranted or not, the fears associated with change are real.

* Pro-technology, reputation, and image are interrelated concepts.

* Job performance suffers during change.

0 The functions of technology transfer and innovation need a formal

organizational apparatus to exist.

0 A Technology Transfer Task Force needs to be recognized as a formal

standing organizational unit.

• Computer-Aided Drafting and Design technology is ready to serve the entire

life- cycle process of constructed facilities.

* A single model of technology transfer and innovation does not apply to all

circumstances.

* A matrix of T2 Flavors for habitual key players in the AEC industry needs to

be developed. This matrix should be arranged according to their function,

business line, and size.

* An array of T2 Mixins for specific technologies for habitual AEC industry

players needs to be developed.

0 Case studies of successful and unsuccessful attempts to T2 need to be elicited,

formalized, structured, and disseminated.

* Pilot project guidelines specifically designed for T2 need to be developed.

Acknowledgments. The work presented in this paper is based on work supported by

the National Science Foundation under Grant No. MSM-8908570, Research Initiation

Award. Any opinions, findings, conclusions or recommendations expressed in this paper are

those of the writer and do not necessarily reflect the views of NSF.

164
References.

1. Bonnett, R. K., 1989. "From Grassroots to Grand Plan", Al Expert, 4(8), 54-59.

2. Bowlin, D.J., 1991. "Pilot Projects: Tools for Implementation", Construction Industry

Institute Special Publication, November.

3. Cleveland, A.B., 1991. "Automation and People", Jacobus Technology Perspective,

Vol.1, No. 4, November/December, pp. 1-8.

4. De La Garza, J. M., and Mitropoulos, P., 1991. "Technology Transfer (T2) Model for

Expert Systems". Journal of Construction Engineering and Management, ASCE, 117(4),

pp. 736-755.

5. De La Garza, J. M., and Mitropoulos, P., 1992. "Flavors and Mixins of an Expert

Systems Technology Transfer Model for the Architecture-Engineering-Construction

Industry". Journal of Construction Engineering and Management, ASCE, September.

6. Feigenbaum, E., Nii, H. and McCorduck, P., 1988. "The Rise of The Expert

Company", New York Times Company, New York, N.Y.

7. Hansen, K.L., and Tatum, C.B., 1989. "Technology and strategic management in

construction." J. Mgmt. Engrg., ASCE, 5(1), 67-83.

8. Helton, T., 1990. "Al Diffusion: Getting Your Company Involved", AI Expert, 5(3),

54-59.

9. Hester, T., 1991. FMC Corporation, Personal Communications, January.

10. Mahler, E., 1991. E.I. du Pont de Nemours, Personal Communications, January.

11. Mahler, E. and Meador, C.L., 1989. Executive Briefing: Implementation Strategies for

Expert Systems, Decision Support Technology, Inc., Boca Raton, Florida, April.

12. Matsuda, M., 1991. Kajima Corporation of Japan, Personal Communications,

January.

13. Moorhead, G., and Griffin, R. W., 1989. Organizational Behavior, Houghton Mifflin

Co., Boston, MA.

14. Rogers, E. M., 1983. Diffusion of Innovations. The Free Press, New York, N.Y.

15. Shaffer, L. R., 1985. Product/System Development for Military Facilities, from the

Briefing in High Technology Test Bed Concept, U.S. Army Construction Engineering

Research Laboratory, Champaign, Illinois.

16. Stretton, A., 1991. Lend Lease Corporation of Australia, Personal Communications,

January.

17. Tatum, C:B., 1986. "Demands and means for construction innovation." Proc. Technical

Session: Construction Innovation, Demands, Successes and Lessons, ASCE, 31-43.

18. Tatum, C.B., 1987. "Process of Innovation in Construction Firm." Journal of

Construction Engineering and Management, ASCE, 113(4), 648-663.

19. Tatum, C.B., and Funke, A.T., 1988. "Partially automated grading: Construction

process innovation." J. Constr. Engrg. Mgmt., ASCE, 114(1), 19-35.

20. Tatum, C.B., 1989a. "Managing for increased design and construction innovation." J.

Mgmt. Engrg., ASCE, 5(4), 385-399.

21. Tatum, C.B., 1989b. "Organizing to increase innovation in construction firms." J.

Constr. Engrg. Mgmt., ASCE, 115(4), 602-617.

165
TECHNOLOGY TRANSFER AND PUBLIC INFRASTRUCTURE DEVELOPMENT:

FINANCING CAPITAL IMPROVEMENTS THROUGH THE CREATION OF KNOWLEDGE

Michael B. Goldstein**

The traditional models for the improvement of public infrastructure depend upon

a few sources of capital. By far the largest portion has come directly from the public fisc,

most commonly in the form of debt amortized out of tax revenues. Next in importance

is public debt financing where the revenues generated by the facility amortize the debt.

Finally, there is the commercially-financed facility that is leased for public use: that is, the

capital cost is amortized through lease payments out of current revenue sources, either

tax levy or revenues generated through the use of the facility.

In recent years, two opposing trends have resulted in a rapidly growing backlog

of infrastructure improvements. On the one hand, local, state and federal debt burdens

have grown to a point where the carrying costs represent a significant portion of the

current-fund budget. In the case of state and local governments, statutory or constitutional debt limits have been reached or approached, while in the case of the federal

government, the magnitude of public debt is seen as jeopardizing the stability of the

economy. At the same time, an aging infrastructure, large portions of which were

constructed during two boom periods -- 1930s and early 40s and again in the 1960s -- is

in need of massive repair and replacement.

The alternative of revenue-driven financing is appears to be available for only a

minority of projects. A highway can generate significant revenues through the imposition

of tolls, a dormitory can create rental income and a dam can result in the generation of

saleable electric energy. If the revenue stream is sufficiently deep and predictable, such

projects can be financed. But absent such sure revenue generators, financing alternatives

are more limited: most needed projects appear not to hold a prospect of immediate

revenues sufficient to pay back a short term advance let along maintain a reasonable

amortization schedule.

In the search for financing alternatives, governments and quasi-governmental

entities (such as universities, which for the purpose of this analysis will be considered

quasi-governmental since they fulfill a public purpose and receive public support) have

sought to capture the value added of newly created knowledge. This "intellectual

property," whether in the form of a breakthrough in molecular biology or a new design for

a snow plow blade, has a monetary value in the marketplace. Yet that value has

historically been underutilized as an institutional financing vehicle.

"Portions of this paper have been published by the National Association of University

Attorneys and the National Association of College and University Business Officers.

"'Partner, Dow, Lohnes and Albertson, Washington, D.C.

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The typical approach for the capture of the value added by a discovery has been

to license its commercial exploitation for a fee representing a percentage of the ultimate

commercial value. Over an extended period of time, this time-honored approach can

indeed generate substantial revenues as a discovery moves into the market place.

However, that value is ordinarily spread out of a period of years, so that the immediate

financial value of the discovery is relatively small. (While the alternative of selling the

discovery for a fixed price has the advantage of an early burst of resources, unless the

discovery is of known and immediate value, the total value realized tends to be materially

less, since the buyer is taking all the risk of commercialization.)

The revenue stream that is created by commercialization typically lacks the

reliability that is necessary to use it as a base for amortizing capital debt. Yet it is a

resource that, under the right circumstances, can be used to support infrastructure

development. The key is to create ongoing financial linkages that transcend single

projects and discoveries. The research and development partnership and its progeny

provide vehicles for just such a capital financing mechanism.

In recent years, an increasing number of colleges and universities and other

government-sponsored research entities have become directly involved in "technology

transfer." That term encompasses a broad range of activities intended to lead to the

commercialization of discoveries arising out of the work of members of the academic

community. Indeed, although the term itself is of recent vintage, "technology transfer" has

been a fact of life in higher education virtually from the inception of the first universities,

as discoveries have made their way into the stream of commerce. The difference, and

the focus of this analysis, is the transformation of the role of the institution from that of a

passive vehicle into an active participant in the process of technology transfer, through

that process creating a mechanism for infrastructure improvement.

There are several restraining forces on the utilization of newly-created knowledge

as a significant financial instrument. One, quite obviously, is uncertainty over the value

of the discovery. However, another less obvious factor is uncertainty respecting the

nature and magnitude of the risks faced by institutions that become directly involved in

the commercialization of research. The advantages of a revenue stream can readily be

outweighed by liabilities that quickly sap those same resources -- and then go on to

invade the general resources of the entity.

It should be clear at the outset that there is no such thing as a "risk free"

involvement in technology transfer, any more than it is possible to design a perfectly safe

chemistry laboratory. But just as it is eminently feasible to design, construct and operate

a reasonably safe laboratory, so it is possible to develop a technology transfer program

that reasonably protects the interests of the institution (and its personnel).

There are several generic models of technology transfer that seek to capture the

value-added of discoveries in an economically efficient manner consistent with protecting

the integrity of the institution. Of course, the general proposition is that the more riskadverse the structure, the less the financial gain, and visa-versa. While this, like most

1 68
general propositions, has some exceptions, it is inescapable that in a venture that involves

the commercial sector the transference of risk carries with it a considerable economic

cost.

The principal active models of technology transfer are as follows:

1. The creation of commercialization entities that bring discoveries into the

stream of commerce. The entity may be an operating division of a

government agency or institution, or it may be a wholly-owned subsidiary.

2. The creation of start-up companies to develop discoveries, with the agency

or institution providing some or all of the initial capital, holding all or a

substantial portion of the equity and providing management and administrative services. The difference between the commercialization entity and the

start-up company is that the former is intended to be an ongoing activity,

while the latter is designed to be spun out, optimally through an acquisition

by a commercial buyer.

3. The creation of ioint ventures with commercial entities to provide for the

commercialization of discoveries.

Each of these mechanisms can create revenue patterns that in turn may be used

for infrastructure improvements. The first two options enable an agency or institution to

go into the capital marketplace to finance the facilities needed to develop the discovery,

and incidentally support the ongoing research and other activities of the organization. In

the first option, investment in the commercialization entity, either in the form of debt or

equity, provides the needed capital. In the latter case, the initial investment is compounded by the buy-out value, which can provide the agency or institution with a

significant intermediate-term infusion of capital (assuming, of course, that the discovery

is developed as commercially valuable).

The third option, the joint venture, affords the agency or institution an entirely

different array of capital improvement options. In addition to the infusion of funds arising

out of the commercial exploitation of the discovery, the joint venture can provide a direct

vehicle for the development of facilities outside of the ordinary financing framework. Most

common is the situation where the joint venture is capitalized to construct facilities, which

are then leased to the agency or institution for the purpose of conducting further research,

the agency or institution utilizing the value of the discovery as all or a significant portion

of its lease cost. Thus, the agency or institution can obtain a facility that is outside

financed, without incurring the attendant debt.

There are, however, fundamental differences between government research and

commercial activity. There is a philosophic difference: commercial ventures are

organized to deal with the financial risks of commercialization, through limiting the liability

of investors, loss shifting through insurance or indemnification and, perhaps most

important, by a general understanding among the participants in the venture that the risk

169
of loss does exist. Conversely, in the traditional government setting there is little attention

paid to the economic risks of research, save perhaps the risks attendant upon overrunning one's research budget and incurring the wrath of the agency head. The term "risk

adverse" quite accurately describes most agencies and institutions, with good cause.

Businesses fail with some frequency: that is a fact of commercial life. However, financial

loss occasioned by imprudent involvement in commercial activities is far more serious a

loss when the victim is a government agency or institution. The bankruptcy of a

government agency is not easy to visualize, precisely because the underlying pockets are

so deep. In short, the issue of risk management in technology transfer must be of

primary concern.

The proposition is simple: how may an agency or institution assess the risks arising

out of its involvement in technology transfer activities, and, having assessed those risks,

what steps should a prudent administration take to minimize them, consistent with

continuing to benefit from the value of its commercialization efforts? Unfortunately, in far

too many instances, both aspects of this analysis are sadly lacking. Without risk

assessment, control of risk is impossible. Yet risk assessment alone is insufficient if, after

determining that a risk exists, either nothing is done or the response is simply to withdraw

from the field. Administrators need a matrix of risk elements and risk control mechanisms

that can facilitate technology transfer while protecting the integrity of the agency or

institution.

This analysis is divided into two parts. First is a discussion of the nature of the

risks attendant upon technology transfer activities, followed by a discussion of methods

of risk management.

I. NATURE OF THE RISKS

The risks attendant upon technology transfer activities arise in three broad

categories: economic loss to those who have invested in the activity, breach of a

contractual obligation to a party to the transaction and harm to those affected by the

discovery. Each may result in financial loss to the agency or institution.

Risks arising out of losses by investors are relatively easily defined and controllable

through a variety of organizational methods. Risks arising out of harm to third parties, on

the other hand, are difficult to predict, complex to protect against and potentially

devastating in terms of the financial consequences. Risks arising out of a breach of

contractual obligations are intermediate in difficulty to avoid and control.

Common examples of losses arising out of harm to third parties are damages

occurring as a result of a defect in a product (commonly referred to as "products liability")

or injuries sustained as a result of the operations of the commercialization activity itself.

Contractual violations often involve conflicts of interest, disputes arising out of the terms

of an investigator's contract of employment and violations of intellectual property rights.

17()
A. FIDUCIARY LIABILITY - PROTECTING THE INVESTMENT

Investors in any commercial undertaking stand to lose all of their investment if the

undertaking is a failure. In the commercialization of discoveries, it is painfully common

that the costs of development of a promising discovery are never recovered through its

commercial sales, if indeed the discovery ever makes it to the marketplace at all. In such

a case the funds invested in the commercialization of the discovery are gone without hope

of recovery. That kind of loss is readily measurable: it is simply the value of the direct

investment in the commercialization venture.

In the case of an agency or institution whose contribution to the equity of the

commercial entity is the discovery itself, the failure of the invention to be commercially

viable may not bear with it any direct financial loss -- although if commercialization would

have been possible through a different approach or with different partners, there are

certainly lost o oportunity costs. However, where the agency or institution backs up the

discovery with a financial commitment, either directly or through a related entity, the loss

will be more tangible and may, depending upon the magnitude of the investment, be

substantial. But such a loss can be anticipated and quantified, and if the agency or

institution or its entity cannot afford the loss, it -- like any other investor -- has no business

being in the game in the first place.

The greater risk is that other investors -- if they believe their interests were not

properly protected by those running the venture -- will bring suit to recover their losses.

This is a considerably more material risk than that arising from the loss of direct

investment, since the value of the loss may be more than the aggregate amount invested

in the venture. The legal principle is straightforward: the persons or organizations

responsible for the management of the entity in which the funds were invested have a

fiduciary responsibility to the other investors; that is, they are obligated to act with

reasonable care to protect the interests of the investors. In turn, the failure to exercise

reasonable care can make the managers liable for the losses of the "passive" (that is, nonmanaging) investors.

An agency or institution that does no more than license discoveries to commercial

entities that in turn are responsible for their further development and introduction into

commerce is well insulated against fiduciary liability, since in fact the agency or institution

does not have any fiduciary dutg. (However, as discussed below, it may nonetheless be

liable to investors if it has, for example, misrepresented the nature of the discovery when

it sold its rights.)

The situation is different in the case of agencies or institutions that invest their own

resources in the commercialization of a discovery, or that take a material equity (that is,

ownership) position in a commercialization entity in return for providing the intellectual

property. Ordinarily, like any investor, the agency or institution that is also an investor

stands at risk only for the value of its own investment. However, if the liability is not

"limited," the agency or institution could be held responsible for losses well beyond its own

investment.

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B. LIABILITY ARISING OUT OF NEGLIGENT CONDUCT

There are two distinct types of liability arising out of negligence. The first, termed "simple negligence," usually involves harm to persons or damage to property arising out

of the conduct of the commercialization operation. The second results from the use of

the p arising out of the commercialization activity by its ultimate consumers.

While simple negligence is a rather straightforward concept, products liability is one

of the most complex areas of the law. It is far more difficult to predict and therefore

protect against precisely because it only manifests itself after the discovery has become

a commercial product and has been distributed in commerce. It arises when a

commercial product causes harm as a result of an inherent defect that was known -- or

should have been known -- by those who offered it in commerce. To prevail, a products

liability claim must contain certain specific elements:

1. Evidence that the product caused the harm;

2. Evidence the harm was caused by the conduct of the defendant (or

defendant's agent, for example, the investigator or the defendant's

surrogate);

3. Evidence that the defendant was negligent in allowing the harm to occur,

and

4. Evidence that the plaintiff was actually harmed by the defect in the product.

C. CONTRACTUAL LIABILITY

A third major cause of financial risk arises out of violations of contractual rights.

There are many possible sources of such risk. For example:

1. An investigator may claim that he or she is entitled to a different share in the

financial benefits arising out of the commercialization of his or her discovery

than that which the agency or institution believes to be the case.

2. A partner in a commercial venture may claim that the agency or institution

failed to deliver on what it was contractually obligated to provide, most

commonly a failure to provide a discovery that does not infringe on another

protected (that is patented or copyrighted) discovery.

3. An investigator may contract with a commercial entity to develop his or her

discovery outside of his or her employment with the agency or institution,

resulting in a dispute between the agency or institution and the entity over

rights.

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4. An agency or institution may accept a sponsored research agreement that

gives the sponsor protection against premature disclosure, but the

investigator may nonetheless release information that vitiates the patentability

of the discovery.

Contractual liability is different from liability arising out of negligent conduct in that

the agency or institution could be acting in good faith and still violate a contractual obligation. The violation of intellectual property rights is form of contractual violation, since

intellectual property rights are established under the terms of an agreement entered into

between the agency or institution (or its surrogate) the investigator and a third party,

typically an entity involved in the commercial development of the discovery. (Even where

there is no formal intellectual property policy, there is a contractual relationship between

the investigator and the agency or institution, since in such a case the respective rights

of the investigator and the agency or institution are defined by statutory principles.)

So long as the sequence of property rights is followed, the ultimate assignee or

licensee of the rights has no grounds for complaint. But if the chain is broken, the agency

or institution (or their intermediaries) can be at risk for purporting to convey defective

rights.

A third aspect of contractual liability concerns conflict of interest. This is not only

one of the most complex and certainly most contentious element in any discussion of

technology transfer, it is also a significant contributor to institutional liability. In its simplest

form, conflict of interest can be defined as a situation where a party acts to the detriment

of another party to whom it owes a particular duty. The most common manifestation is

that of the investigator who becomes a principle of a company that negotiates a license

for the investigator's discovery from the investigator's institution. More complex issues

arise where it is the institution that creates the entity that is the licensee of the discovery -

- a "spin-off" company -- and the investigator is given an interest in or a managing role in

that entity.

Liability arises from conflict of in in several ways. The conduct of the

investigator in serving "two masters" can cause either party to challenge his or her actions

as not in their best interests. Particularly sensitive are investors who might be lead to

challenge the commitment of the investigator to the work of the commercial entity. The

investigator may also challenge an institutional conflict of interest policy as unreasonably

intrusive. C'itically, a suggestion of conflict of interest can diminish an institution's ability

to defend itself against other forms of liability.

III. CONTROLLING RISK

Risks arising out of commercialization activities may be controlled in several ways.

First, the conduct of the technology transfer activity can be organized in such fashion so

as to limit or minimize the risk of loss to the parent institution. Second, the burden of

losses which do arise and which otherwise would be the responsibility of the institution

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(or a commercialization entity under its control) can be shifted to some other party.

Finally, the technology transfer activity can be structured to provide the agency or

institution with a degree of insulation from loss.

The manner through which an agency or institution engages in technology transfer

activities has a great deal to do with its ability to control the risks arising out of those

efforts. The organizational, loss shifting and structural issues begin well before the terms

of a licensing agreement or joint venture are developed. Indeed, they start with the

degree to which the agency or institution exercises control over the technology transfer

process, beginning with the rules governing the conduct of investigators and their

relationship with and responsibilities to their agency or institution, and they continue

through every step of the technology transfer process. Nor does any one approach

guarantee absolute protection. Rather, it is the combination of methods of risk

identification and control that can be provide an institution with the protection it requires.

A. MANAGEMENT OF TECHNOLOGY TRANSFER

The organization of an agency or institution contributes significantly to its ability to

identify and control risks arising out of technology transfer, as well as its ability to identify

and exploit the benefits of such activities. Assuring that the organizational components

and policies are appropriate to the agency or institution is an essential first step. The only

thing worse than not having an appropriate management structure is putting the structure

in place and then ignoring it in practice.

The key organizational and management control elements include:

1. The existence of comprehensive, agency or Institution wide policies

on intellectual property and technology transfer, and assurance that

the policies governing the conduct of professional personnel

adequately address the issue of rights to all forms of discoveries and

provide standards for and require disclosure of interests in any

commercial ventures which are in any fashion related to an investigator's research activities.

2. The existence of an agency- or institution-wide office with responsibility for the oversight of all technology transfer activities.

3. Assurance that all agreements for technology transfer, Including

sponsored research, are subject to review and approval by qualified

counsel.

4. Assurance that each discovery is evaluated to determine it patentability or protection under copyright laws, and that the agency or

Institution provides an expeditious and professionally managed

mechanism for the assertion of such rights.

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5. Assurance that each discovery is separately evaluated to determine

the nature of potential product liability risks.

6. Assurance that the qualifications of each potential commercial

participant in a technology transfer venture are thoroughly reviewed

respecting the participant's financial and technical capacity and

capabilities.

The adequacy of each element must be independently measured to assure that the

management structure and the organization of the institution affords the appropriate level

of control consistent with the need to protect the financial integrity of the institution.

The most delicate aspect of any technology transfer effort is the selection of the

commercial partner. It is this entity that will bear all or a major portion of responsibility,

depending upon the form of technology transfer, for the transformation of the discovery

into a commercializable form, the development of a means of production and the

marketing of the resultant product. The commercial partner may also assume

responsibility for the perfection of intellectual property rights and will certainly play a major

role in the financing of the enterprise. This being the case, it is remarkable the degree to

which agencies and institutions are ready to do business with entities that lack

demonstrated capacity to fulfill those tasks.

There is an affirmative obligation on the part of the agency or institution to very

carefully and diligently screen potential commercial partners to ascertain that they have

the ability to perform in the expected fashion. Such a review must cover both the

substantive expertise and experience of the company in the commercialization of the

specific discovery and its financial situation. It must at all times be recalled that it is the

agency or institution that is transferring something of value to the commercial entity, and

it is therefore as much the latter that must prove itself worthy as the institution must

demonstrate the value of the discovery. Such a position is as important from the

perspective of risk management as it is a component of an effective negotiating strategy.

B. SHIFTING THE BURDEN OF LOSS: INSURANCE, INDEMNIFICATION

AND ASSUMPTION OF RISK.

The best internal management cannot assure complete protection from losses

arising out of technology transfer activities. It is therefore incumbent upon the agency or

institution to make use of available methods of risk transfer to ensure that such losses as

may occur do not impair the functioning of the institution. It is important to note that the

shifting of the burden of loss does not in any way affect the issue of liabili1y. Rather, it

speaks to the question of who pays one liability is established. Thus, primary attention

must be paid to reducing the risk of loss: indeed, the cost of risk transfer devices is to

a significant extent driven by the degree of risk against which the protection is sought.

To the extent the agency or institution has reduced the risk of loss through the various

techniques discussed in this analysis, the availability and the economy of loss transfer

mechanisms will be enhanced. Conversely, to the extent an agency or institution fails

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to properly manage and structure its technology transfer activities, it may not only

increase the risk of loss but also decrease the availability of loss transfer mechanisms and

increase the cost of those that remain accessible.

There are three basic approaches to loss transfer: insurance, indemnification and

assumrtion of risk. The most common way to shift the burden of loss is insurance.

Insurance is simply a contractual agreement through which a third party agrees that, upgQI

the occurrence of specified events under specified circumstances, to defend the insured

against specified claims and to pay for any losses arising out of such claims, ug to a

specified sum. The insurance contract (the "policy") will typically not only state the kinds

of things covered by the insurance, but also those that are mt. Often, the policy will also

provide for a retention of risk by the policyholder; that is, an initial portion of any loss

would be borne by the insured, not the insurer. Insurance carriers intensely dislike being

surprised, and they write their policies to minimize that eventuality. Obtaining adequate

insurance for technology transfer activities requires an extremely careful analysis of the

agency's or institution's present loss control situation as well as examination of alternative

strategies to control potential losses.

The distinguishing characteristic of a technology transfer program is the fact that

it is typically an activity outside of the customary role of the agency or institution. Thus,

it is likely that in writing general liability coverage for the agency or institution, the

insurance carrier did not contemplate university in technology transfer, and therefore may

have excluded coverage for claims arising from such activities. The primary question,

therefore, is whether existing general liability insurance extends to all aspects of the

technology transfer activities of the agency or institution. Such policies typically also

exclude product liability claims where such claims arise from goods and services in

commercial use. Finally, policies commonly only cover separate corporate entities related

to the agency or institution if they are specifically identified in the application for coverage

(or in an amendment to that application). Obviously, such exclusions would leave an

institution naked with respect to key aspects of its technology transfer activities. It is

therefore essential that the terms of the contract of insurance be carefully reviewed by the

risk manager or counsel to ensure that all aspects of the technology transfer operation

are insured, to the extent that a separate risk assessment (as discussed in this analysis)

determines that liability arising from those activities might be assessed against the

institution. Where the agency's or institution's existing insurance policies are not

determined to extend to its technology transfer activities or to provide adequate coverage

for such activities, it is necessary to obtain either separate coverage or to negotiate an

extension of coverage to afford adequate protection.

The second means of shifting the burden of loss is through indemnification.

Indemnification is nothing more than a private form of insurance. However, instead of a

regulated insurance carrier agreeing through a contract of insurance to defray the cost

of defense and pay for losses arising out of certain causes, a private party contracts to

do so. In the context of technology transfer, indemnification is commonly utilized in the

negotiation of licenses for the use of the agency's or institution's discoveries. The

licensee agrees, as a condition of receiving the license, to "indemnify and hold harmless"

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the agency or institution from "any and all losses, including attorneys fees" arising from

the company's exploitation of the licensed discovery.

While indemnification can provide substantial protection, indemnification

agreements are carefully scrutinized and narrowly construed: a putative indemnifier will

only be held responsible if the conduct of the licensee creating the liability falls within the

narrow confines of the indemnification agreement. However, indemnification does suffer

from a very major drawback: it is only as good as the financial capacity of the indemnifying entity. Indeed, having an indemnification agreement is a great deal like hiring the

services of a bodyguard. If he or she is able to fend off adversaries, the investment is a

good one; conversely, if the bodyguard is weak and scrawny, the protection is illusory.

Thus, if the indemnifying entity has little or no assets (as is often the case with startup

companies), then it is unlikely that it would be able to mount an aggressive legal defense,

let along pay material settlements.

It is particularly inappropriate for an agency or institution to consider itself protected

by an indemnification clause in the agreement between itself and its own technology

transfer subsidiary or spin-off. Unless the subsidiary has very substantial independent

assets, the value of such an indemnification agreement is not only illusory, but can provide

a pathway for directing liability back to the agency or institution itself.

Aside from the financial capacity of the indemnifying entity, the agency or institution

must ascertain that the entity has the legal authority to enter into such an agreement.

This is particularly the case with public bodies, which are often excluded under provisions

of state law from indemnifying any other entity. The fact that an entity signs an

indemnification agreement does not resolve the question whether it has the legal capacity

to do so. Counsel must also be consulted relative to the scope of indemnification allowed

under state law. Public policy considerations have driven statutes that prohibit losses

arising out of certain kinds of claims, particularly those arising out of gross negligence

or violation of law, from being shifted through indemnification. Conversely, the institution

or agency must not allow itself to become an indemnifier if its organic law does not so

permit.

The third method of risk transfer involves disclaiming responsibility for subsequent

losses; that is, the exclusion of all warranties. In its simplest form, the licensee takes the

license to the discovery without any expectation that the discovery is in fact marketable,

effective, safe or operational. That is, the license is granted without any "warranties,

express or implied." Then, if something is found to be wrong with the discovery, the

licensee would presumably not have any recourse against the institution, and if the

licensee were to be sued, it would not be able to bring in the institution as a defendant.

Likewise, if an ultimate user of the discovery brought an action against the university

arising out of the development of the discovery, the university could mount a defense that

since it transferred the discovery to the licensee without any representations that it would

work or be safe, and the licensee took it on that basis, the institution has no responsibility

for what subsequently happened.

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While express disclaimers of warranties are useful, they have two key limitations.

First, to the extent the agency or institution disclaims an warranties, it is to some extent

degrading the value of the discovery. Second, a disclaimer of warranties will generally Mt

protect the agency or institution from claims arising out of its negligent conduct.

Therefore, although the practice of avoiding warranties is a helpful risk limitation measure,

it is not comparable to either insurance or indemnification in affording significant

protection.

C. THE STRUCTURING OF COMMERCIALIZATION SPIN-OFFS AND

OTHER RELATED ENTITIES.

It is clear that a well-structured commercialization subsidiary can afford an agency

or institution an increased level of protection against losses while enabling the entity to

capitalize upon its research activities. Separate technology transfer entities afford

agencies and institutions a variety of advantages in the commercialization of discoveries,

including increasing the realization of the economic value of those discoveries and

protecting from certain types of loss.

However, the mere creation of another corporate entity does not, of itself,

necessarily afford the agency or institution any additional protection. Even the best

thought-out separation of responsibilities between an agency or institution and a

separately created entity can come to naught if that separation is breached in certain key

ways. Confining research activities to a separately incorporated entity does not

necessarily absolve an agency or institution from liability arising from their development

and commercialization. While corporations, along with limited partnerships, do afford

investors a shield against unlimited liability, establishing such a subsidiary structure is

emphatically not a guarantee that the institution will henceforth be protected from the risks

attendant upon technology transfer.

Nonetheless, when an agency or institution decides to become involved in

technology transfer activities in order to generate needed capital, it should certainly

consider the use of a separate legal entity, whether created for the purpose or already

existing.

However, an existing entity may not be structured appropriately for the particular

use. A non-profit, tax exempt entity with a self-perpetuating board may certainly represent

a desireable model for the holding of endowment funds, but it may not be the right

structure for the commercialization of a discovery. The notion that there is something

magical about a tax exemption is misplaced in the context of commercialization activities:

in many cases a taxable entity is a more effective instrument for maximizing the return to

the institution and to its investigators. The nature of the entity needs to be matched to its

purpose, a persuasive reason not to simply implant commercialization activities in any

readily available subsidiary.

There are also several good reasons not to rush to create a separate entity for the

commercialization of faculty discoveries. The nature of the agency or institution has a

considerable amount to do with the value of such structures. For example, a public

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agency or institution may benefit from the creation of a separate entity to afford it more

flexibility in contracting and to allow it to retain income that might otherwise flow into the

general treasury of the state. An independent institution or quasi-public agency, on the

other hand, may not necessarily need a separate entity to benefit from this flexibility, and

the imposition of another entity may simply add a layer of overhead and increase span

of control problems. A small organization with limited administrative resources may have

particular difficulty in overseeing the management of a separate entity, while a larger one

may be more readily able to designate staff to carry out this important purpose. However,

an entity that is established and then left on its own may pose more of a risk than a

benefit: effective control, consi.itent with the maintenance of legal and operational independence, is an important consideration in establishing entities that will be part of an

agency's or institution's technology transfer program.

There are also rather complex tax issues that come into play in the decision

whether to set up one or more separate entities. A large, inclusive entity (such as the

institution itself) can shelter substantial unrelated business income, something that might

be impossible for a small, single purpose non-profit entity. Likewise, the amount of

commercial activity that can take place within a large organization is substantially greater than that which would be allowed within a small spin-off. In the former case, the taxes

levied on the technology transfer activity might be increased by using a separate entity, while in the latter the entity's tax exempt status might be jeopardized. Finally, although

the relationship of the entity to the agency or institution can facilitate its favorable tax

treatment, the close ties that assure preferential tax treatment in the form of recognition

as a supporting organization may weaken the liability protection the entity may have been

established to provide. Thus, tax considerations must be carefully weighed against other

intended purposes of the subsidiary structure.

Regardless of whether an existing or a new entity is to be used as the instrument

for technology transfer activities, there are several key questions to allow the agency or

institution responsibly assess whether the entity will actually serve the intended purpose

of isolating the risks arising from the technology transfer and capital formation efforts of

the agency or institution.

1. Is there an opinion of counsel that under applicable law the entity has

entirely separate existence?

2. Is the governance of the entity distinguishable from that of the

Institution?

3. Are the operational relationships between the institution and the

subsidiary sufficiently distinct so that a court might not be encouraged

to ignore the Intended separation?

4. If a major part of the ministerial management of the entity is be

contracted back to the institution, is the agreement providing for such

transfer explicit in the delineation of delegated responsibilities?

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Each question bears on the degree to which the technology transfer entity will be

able to stand between the institution and potential third-party liability arising out of the

technology transfer program.

V. TECHNOLOGY TRANSFER MODELS

The methods used by agencies and institutions to move discoveries into the stream

of commerce have undergone considerable evolution in recent years, with considerable

ingenuity and imagination in evidence. The structure of the technology transfer activity

affects a variety of elements, of which risk management is but one. In the process of

deciding upon a technology transfer model, the organization must balance such elements

as administrative burden versus immediacy of economic benefit versus risk of loss. A

comparative examination the attributes of several technology transfer models can afford

the agency or institution an opportunity to make a reasoned decision as to the most

appropriate strategy in keeping with its own structures and priorities. The five attributes

considered are:

Commercialization flexibility: the degree to which the parties are free to make

use of different structures and strategies to achieve commercialization.

Benefit to the organization: the potential return to the agency or institution of the

value of the discovery.

Benefit to the Investigator: the potential return to the investigator of the value of

the discovery.

Administrative burden: the extent to which the organization must devote

administrative resources to the management of the technology transfer process.

Institutional risk control: the degree to which the agency or institution can define

and set limits upon its exposure.

Institutional risk exposure: the potential exposure of the agency or institution to

losses arising out of the technology transfer activity. This is further divided into

fiduciary liability and liability arising from negligent conduct.

Applying these attributes to generic models of technology transfer, a matrix of costs

and benefits can be developed, allowing institutions to evaluate the virtues of each

approach. It is also important to note that the nature and status of the research must

be considered in evaluating appropriate vehicles. Applied research that results in

prototypes that may be tested in a commercial setting is different from the establishment

of a production facility. The former is a common institutional activity and generally does

not require the imposition of substantial risk-controlling structures. However, the line

between the development of a prototype to test a theory and a production device is not

a clear one, and care should be taken not to inadvertently cross from one to the other

18()
without evaluating the exposures that may arise.

The models examined are ownership of rights and control of commercialization by

investigators; licensing of discoveries by the agency or institution, either directly or

through a third party; and organization involvement in the commercialization of the

discovery, either directly or through intermediaries such as joint ventures or spin-off

entities.

A. Ownership and Control of Commercialization by the Investigator.

The simplest, although for most agencies and institutions no longer the best, way

to deal with the commercialization of discoveries is to treat them in the same fashion as

the authoring of books and articles. Among educational institutions, it is common that the

institution does not retain any residual rights in the work and does not receive any direct

benefit from its publication, except where the authoring involved a very specialized use

of institutional resources.

Some institutions continue to treat all intellectual property created by their faculty

as undifferentiated, even without regard to the locus of the work out of which the

discovery may have arisen. A faculty member who creates a new superconductor in his

or her laboratory at the institution stands in the same position relative to the ownership of that discovery as one who writes a new textbook: both are free to sell all or some of

the rights their work, in the latter case through publication and the former through production, most often under a licensing agreement.

Under such an arrangement, there is no oversight by the institution respecting the

manner through which the investigator seeks and obtains commercialization of his or her

discovery, and often no restrictions on the manner or degree to which he or she may be

personally involved in that process.

This approach has the positive attributes of requiring a minimum of institutional

involvement, and therefore virtually no overhead investment, as well as affording the

investigators the utmost freedom in the management of their affairs, including their ability

to profit from their efforts. However, the absence of institutional involvement is a doubleedged sword. First, regardless of the niceties of academia, a an investigator is an

employee of the institution, and work done by such an employee on the employer's time

(that is, while being compensated by the institutior' and while using the facilities of the

institution is work for the institution. While under pi -vailing intellectual property law, the

creator of a work (whether a writing or an invention) "owns" the work, the fact that the

discovery was made by its paid employee on its premises under its overall supervision inextricably links the institution, as a legal entity, to the resulting product. Even though an

institution may allow a faculty member free rein to commercialize his or her discovery, that

does not necessarily relieve it of potential liability, although in some instances it might. Thus, such an exercise of rights does not absolve the institution from responsibility

respecting the effects of the discovery on third parties. Of course, the institution and the

faculty member may agree that the faculty member will, as a condition of receiving all

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rights to the discovery, indemnify the institution from any liability arising out of its

commercialization. However, if, as is probable, the faculty member lacks the wherewithal

to satisfy the claim of the injured party, the institution still may stand directly at risk.

Second, such an arrangement leaves with each faculty member the total

responsibility for negotiating the commercialization of his or her discovery. For a very few,

this is a reasonable burden. For most, however, the costs of acquiring adequate

protection, let alone obtaining qualified professional advice, is more than can be

reasonably expected. Whether the faculty member attempts to handle negotiations on his

or her own, engages an agent who negotiates for him or her for a fee or in return for a

share of the value, or enters into an agreement with a commercial entity for it to handle

commercialization, the interests of the institution are simply not on the table. While the

totally open playing field would seem to allow for the widest possible range of commercialization strategies, in fact the exclusion of the institution from the equation denies the

process an important and effective player.

Third, the institution is denied any benefit from the discovery, particularly its value

in capital formation, even though it may have invested substantial resources in making it

possible.

The attributes of this approach are as follows:

Value for capital formation: Nil.

Commercialization flexibility: High, but potentially limited by a lack of tangible

resources on the part of the resources.

Benefit to the institution: Nil, except for possible sponsored research indirect cost

recovery.

Benefit to the investigator: Potentially very high in comparison to other alternatives,

but in practice aries from very low to very high. In large measure dependent upon

negotiating skill of investigator and nature of transaction.

Administrative burden: Very low.

Institutional risk control: Very low.

Institutional exposure to fiduciary liability: Probably low.

Institutional exposure to product liability: Varies, but could be very high.

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B. Licensing of Discoveries.

By far the most common way organizations are able to transfer discoveries into the

stream of commerce is through the negotiation of a license with a commercial entity that

will complete development and produce and market the resulting product. Such licensing

activities are carried out through several structural models, each of which has different risk

assessment attributes.

1. Direct licensing by the agency or institution.

The most straightforward licensing approach is for the institution to hold all rights

to the discovery and issue the license in its own name. The organization must determine

which discoveries are of commercial potential, secure appropriate patent or other

protection, identify potential licensees, negotiate a license and oversee the collection of

royalties and the protection of its rights.

The advantages to this strategy are its relative simplicity and immediacy of control.

Possible disadvantages include a lack of flexibility respecting the use of royalties (a

particularly serious problem for public institutions) and the absence of any insulation

between the institution and the licensee, as well as the substantial administrative burden.

The utility of this approach for capital formation is obvious: the revenue stream is generally

insufficiently defined to support debt financing and inadequate for immediate capital

development.

This approach has the following attributes:

Value for capital formation: Low.

Commercialization flexibility: Low.

Benefit to the institution: Varies.

Benefit to the investigator: Varies i om very low to moderate.

Administrative burden: High.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Low.

Institutional exposure to product liability: Low to moderate.

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2. Licensing of Discoveries Through an Outside Entity.

While direct licensing is an attractive approach, it requires a commitment of

significant resources, not only in terms of the negotiation of the licenses but also in the

screening of discoveries, the identification of potential licensees and the supervision of the

royalty process. To avoid this burden, a number of organizations have turned to the use

of an outside licensing entity. Such an organization is typically granted a right of first

refusal, allowing it to examine each discovery and to seek to license those in which it has

determined there exists a commercial opportunity. The outside entity identifies potential licensees and attempts to negotiate a license. If a license is issued, the outside entity and

the institution share in the royalties, and the outside entity is typically responsible for

oversight of the royalty process.

This approach has the following attributes:

Value for capital formation: Low.

Commercialization flexibility: Low.

Benefit to the institution: Varies, but lower than direct license, since the licensing

firm must share in revenues.

Benefit to the investigator: Varies from very low to moderate, but tends to be lower

than direct license for the same reason.

Administrative burden: Low.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Low.

Institutional exposure to product liability: Moderate.

3. Licensing Through a Related Entity.

To overcome the disadvantages of a direct licensing program while not surrendering control to an outside entity, a growing number of agencies and institutions have

established various forms of related entities, most commonly a tax-exempt university foundation, that carries out the licensing function for the institution in the same manner

as an unrelated third party.

In some cases, the related entity is assigned the rights to all or specified

discoveries, either, in the case of some public institutions, through a statutory enactment,

or by contractual agreement between the organization and the related entity. In other

situations, the related entity either has a right of first refusal to all discoveries or may request transfer of a specific discovery. In the latter case, the agency or institution or the

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investigator, or both, retain the right to decide whether the related entity will control

licensing. Unlike arms-length third party licensing arrangements, related licensing entities

are not typically subject to "march in" provisions.

This approach has the following attributes:

Value for capital formation:Varies.

Commercialization flexibility: Low.

Benefit to the institution: Varies, depending upon the aggressiveness of the related

entity.

Benefit to the investigator: Varies, depending upon the aggressiveness of the

related entity and the policies of the institution, from very low to moderate

Administrative burden: Low for the institution; high for the related entity.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Low for the institution; low to moderate

for the related entity.

Institutional exposure to product liability: Moderately low for the institution;

moderate for the related entity.

C. INVOLVEMENT IN THE COMMERCIALIZATION PROCESS

The alternative to licensing the rights to commercialize a discovery is the

involvement of the agency or institution in the actual commercialization process, either by

bringing the product to market itself or in entering into some form of joint venture with one

or more outside entities. Instead of assuming the traditional role of passing the discovery

to a commercial entity through the vehicle of a license, leaving to that entity the risks --

and therefore most of the benefit -- attendant to commercialization, an increasing number

of agencies and institutions are maintaining an operational involvement with the discovery

through all or most of the commercialization process. On the one hand, this approach

allows the institution to substantially increase its share of the value of the discovery. At

the same time, the direct involvement in commercial activity opens the institution to risks

that are either not present or minimal in the context of passive licensing.

This is not to say that institutions ought not consider direct involvement in

commercialization. The benefits that can attend such efforts may be considerable, and

for certain types of discoveries the ongoing involvement of the institution can play a

critical role in the success of the commercialization process.

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To a substantial degree, the particular structure that is utilized to achieve

commercialization affects the nature and degree of the risks and benefits to the institution.

There are three general models for institutional involvement in the commercialization

process: direct commercialization, commercialization through a related entity and

commercialization through a joint venture, typically involving what are referred to as "spinoff' or "spin-out" companies.

It is important to note that there do not exist clear distinctions between these

models: commercialization through a related entity or direct commercialization may also

involve joint ventures with other entities, as well as the involvement of outside sources of

capital and debt. The relationship of the institution to the commercial venture, and to its

partners and investors, significant affects the exposure of the institution to the attendant

risks. The interposition of a subsidiary or related entity can to varying degree depending

on the specific circumstances limit those risks, but they cannot be altogether eliminated:

as stated in the introductory section, there is no free lunch. It is immutable that the price

of an increased share in the value-added of the discovery is an increased share in the

risks. However, the relationship is not linear: an institution can significantly increase its

share of the benefits without an equal increase in its exposure through the use of

sophisticated structuring of the transaction as well as the appropriate application of risk

control and loss shifting techniques. Conversely, the failure to carefully structure the

transaction, and to diligently apply risk control and loss shifting devices can easily result

in a significant increase in institutional exposure without an attendant increase in benefit.

In all cases, however, the nature of the transaction drives the risks and the benefits,

which in turn requires that the entirety of the transaction be designed and implemented

with both great care and an understanding of all of its implications.

1. Direct commercialization.

An agency or institution can simply establish a manufacturing and marketing arm

to bring a discovery into the stream of commerce. Such an approach certainly reduces

any sharing of value with outside entities, except to the extent that the institution must

go to the capital marketplace for financing and to outside entities for marketing and other

services. However, it bears with it not only very substantial financial potential but also very

significant risks. The obvious advantage is that all of the profits are retained by the

institution and the investigator. The disadvantage is that the risks that ordinarily attend

the commercialization of a discovery are firmly rooted within the institution.

While most administrators express horror at the idea of engaging in direct

commercialization activities, such efforts are in fact common, albeit on a limited scale: for

example, research laboratories often fashion a limited number of pieces of sophisticated

equipment and instrumentation developed by its researchers and sell them to other

institutions, government agencies and commercial entities. Despite the limited number of

production units, this is indeed direct commercialization, with all the attendant risks. There

are many other examples of institutional "industries," some of the most venerable having

been embedded within agriculture programs.

1 86
This approach has the following attributes:

Value for capital formation:High.

Commercialization flexibility: Very high.

Benefit to the institution: Potentially very high.

Benefit to the investigator: Varies, but usually high.

Administrative burden: Extremely high.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Very high.

Institutional exposure to product liability: Very high.

2. Commercialization through a related entity.

As an alternative to directly engaging in commercial activity, agencies and

institutions have created related entities that assume the commercialization role. These

entities are either wholly or substantially owned by the institution, and the net profits of the

subsidiary are returned to the institution in , form of dividends or limited partnership

distributions. Related entities may be taxable or tax-exempt, and they may be corporations or partnerships.

One key advantage of using a related entity for commercialization lies in the greatly

enhanced flexibility that operating outside of the institutional framework affords, an

attribute that is particularly apparent among public institutions. Such an approach also

allows the institution to better direct the flow of revenues and, if the structure is properly

designed, to deflect risks from the institution itself. The degree and the effectiveness of

the separation between the related entity and the institution will dictate the extent to which

the entity actually affords protection against risk exposure.

This approach has the following attributes:

Value for capital formation: Very high.

Commercialization flexibility: Very high.

Benefit to the institution: Very high.

Benefit to the investigator: Varies, but usually high.

Administrative burden: Low to the institution; very high to the related entity.

187
Institutional risk control: High.

Institutional exposure to fiduciary liability: Low to moderate for the institution; very

high for the related entity.

Institutional exposure to product liability: Low to moderate for the institution; high

for the related entity.

3. Commercialization through spin-off companies controlled by an entity

related to the Institution.

Finally, there is the model of a related entity controlled by the agency or institution

that does not engage in commercial activity itself but rather licenses the rights to a

discovery to a spin-off company that is then capitalized and, usually as a joint venture with

a commercial partner, brings the discovery into the stream of commerce. Typically, when

the discovery is successfully commercialized, the spin-off company is sold to the

commercial partner, with the institution (through its related entity) receiving the capital

appreciation. There are many models for this type of enterprise which may use joint

ventures, various corporate forms and limited partnerships to accomplish their purposes.

The institution may own a major share of the equity of the spin-off, either directly or

through an intermediary, although as the commercialization process progresses the

institution's interest in the spin-off may decline. The relative degree of institutional

ownership may sicnificantly affect the exposure of the institution.

This approach has the following attributes:

Value for capital formation:Very high.

Commercialization flexibility: Very high.

Benefit to the institution: Very high.

Benefit to the investigator: Varies, but usually high.

Administrative burden: Low to the institution; high to very high for the related

intermediary entity.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Low to moderate for the institution;

moderate for the intermediary entity.

Institutional exposure to product liability: Low for the institution; moderate for the

intermediary entity.

188
Note that while the spin-off entity may be a joint venture or have outside

investment, that need not be the case. There are a number of examples of the entities

being wholly owned by the agency or institution or its intermediary (or a combination

thereof), with the whole of the earnings going back to the institution and with management

vesting with the institution. To the extent the spin-off entity appears entirely controlled by

the institution, the attributes are altered as follows:

Value for capital formation:High.

Commercialization flexibility: Very high.

Benefit to the institution: Very high.

Benefit to the investigator: Varies, but usually high.

Administrative burden: Low to moderate to the institution but high to the related

entity.

Institutional risk control: High.

Institutional exposure to fiduciary liability: Moderate to very high.

Institutional exposure to product liability: Moderate to very high.

VI. CONCLUSION

Involvement in the transfer of technology through the commercialization of

discoveries is becoming an inescapable fact of life for an increasing number of agencies

and institutions. Such a process can not only accelerate the dispersion of discoveries into

the stream of commerce, but also afford organizations a new medium for the formation

of capital necessary for the replacement and expansion of its infrastructure.

These ends can only be accomplished through an understanding of the available

structures, their attendant risks and the management of those risks. Through aggressive

internal organization, the use of loss shifting techniques and the creation of appropriate

structures, some risks can be eliminated entirely and others can be reduced to

manageable levels. None need be seen as so threatening as to preclude the involvement

of an agency or institution in the process of moving discoveries from the laboratory into

the stream of commerce.

189
Implementation Innovation Through

Total Quality Management (TQM)

James A. Broaddus

Associate Director

Construction Industry Institute

The University of Texas at Austin

As a newly appointed member of a committee to develop a

proposal for the implementation of total quality management

(TQM) at The University of Texas, I watched as our group outlined the research process in a process flow diagram. The last

block of the model read "publish the findings of the research."

To complete major research projects to the point of publication

is a formidable challenge, but what about the adoption and use

of the research results. As I surfaced the issue of continuing

the process into technology transfer, my colleagues said,

"You're right. We should include it, but that's the hard

part." That group, like this one, recognized that technology transfer or implementation, as we call it in CII, is difficult,

and we all continue to struggle with that very same issue.

CII started with this in mind. From the beginning, our

mission has included the words "research" and "implementation."

Despite this, there has been much in the way of research, but

as far as we can gather, much less in the way of implementation

than we would like to see. Nevertheless, we are endeavoring to

put more and more effort behind expanding our implementation

efforts.

First, let me introduce you briefly to CII. CII has a

staff of 14 people located in Austin at The University of

Texas. We are an organization that is funded largely by owners

and contractors from the private sector. However, we do have a

handful of public sector members, each of which contributes

$30,000 a year in grants to the Institute. The membership is

fairly evenly divided between owners and contractors. Twentyseven universities also participate primarily by providing

research for CII through their universities. The triad between

academia, owners, and contractors is a graphic statement of how

research and other activities of the Institute are carried out.

One of the real keys to CII's success has been the participation of its membership. The contributions of its companies

go far beyond the $30,000 a year in grant money provided to

CII. Participation on task forces, boards, action teams, etc.

normally numbers about 700 people per year, with their

companies funding the employee's participation. As a result,

we have estimated that services in kind to CII have numbered as

much as $25 million a year, which is about 8 times the cash

budget of CII.

191
In the area of research, the companies and universities

participating have produced a prolific amount of material. As

you can see from the sampling of products, a wide range of

material, particularly those that affect the management of

projects, has been published and is available to the industry

at large.

Currently, CII has 34 active task forces which are in

various stages of their research effort. A task force is made

up of approximately 15-20 industry volunteers, teamed with an

academic who physically accomplishes the research. One of the

keys to the effectiveness of this research has been the close

involvement of the member companies of CII. For example, the

Board of Advisors, representing all the companies of CII,

selects the subject areas of task force inquiry. The task

force then develops the specific topics for study and seeks

approval from the CII Executive Committee on those topics. The

task force then develops a detailed research plan and schedule,

as well as budget figures. When all this information is

gathered, the task force plan and budget are presented to the

Board of Advisors again for approval. No research is initiated

without considerable involvement from the industry members of

the task force, and no commitment is made to proceed with the

research without a majority vote of the Board of Advisors. As

a result, the relevance and value of the research have been

high.

Now comes the hard part--implementation. The history of

implementation in CII has also been an interesting development.

A significant implementation step was a decision to produce

summary pamphlets for the research of the Institute. These

pamphlets boiled down the key elements of research into

executive summary form for ease of reading and implementation

by industry members. Shortly after the formation of CII, an

Implementation Committee was formed to promote this effort.

They viewed their role primarily as a quality and consistency

check for CII products which translates into review of the

summary pamphlets. Later, it became apparent that more needed

to be done to promote implementation of these valuable research

products. Organizationally, new groups, called action teams,

were formed. Action teams, like task forces, were composed of

industry participants and were established to promote implementation in specific areas. The next development in CII implementation became education of project management personnel,

which we will discuss later. The last significant step in

CII's implementation history has been the development of an

Implementation Strategy Subcommittee and long range implementation plans.

We feel like a significant effort in implementation is

worth the effort. A recent study completed between the costs

and benefits of maximum use of CII/CICE concepts is quite

192
revealing. When categorized into eight management areas, the

CII products were shown to have potential gross savings of

anywhere from 5 to 15 percent and a benefit to cost ratio never

less than 10 to 1. This was based on the replies of over 400

respondents from members of CII companies. There is a strong

motivation for and significant energy being expanded on the

implementation activities of CII.

Recognizing that only companies can implement, CII implementation activities need to make implementation more company

friendly. The CII Strategic Plan, revised and published in

1990, noted that under the key pursuits of our Institute that

implementation should aggressively address planning, communication, education, and measurement. As a result, a number of

action teams were formed to address various issues. Currently,

CII has 15 action teams which are working in virtually all the

areas laid out by the Strategic Plan.

One fundamental truth is demonstrated by the "typical

company." To date, most of the involvement in CII has been at

the corporate level where the awareness of the product has been

high. However, implementation takes place at the project

level. CII products must be applied to the projects if the

paybacks from implementation are ever going to occur. As a

result, project managers not only need to be more aware of CII

products, but to be knowledgeable in their application.

One of the first implementation products of CII dealt with

planning and organizing a CII implementation program. The

Plants and Divisions Action Team of CII has recently completed

a publication called, "Implementation Process for Improved

Quality." It is built on the total quality and management

model. The manual lays out a typical process for implementation and allows a company to tailor that process to their own

uses. Another action team, the Pilot Projects Action Team,

produced a brief publication on pilot projects and how they can

be used as an implementation tool. The pamphlet describes how

the barriers to organizing a pilot project can be overcome, and

what guidelines should be followed in executing CII products

through a pilot project. Additionally, another planning tool

has been the "Manual for Small Project Management." This

addresses the often ignored small projects, and how CII

products can be applied to them. It is organized by the phases

of a project with some special subject areas as well. It

serves as a good reference manual and menu for CII product

applications on small projects. If you will note, the word

"small" is actually scratched out and the word "special" is

inserted. This is because in defining small projects, what is

small to one company may be large to another and vice versa.

However, each organization seems to have small projects which

frequently are ignored.

193
In the area of communication and awareness, we have

produced a success story video called "The CII Experience." It

highlights more successes on different projects by interviewing the participants in the projects. The purpose of this video is

to create an awareness that products have been used in actual

practice, and what are the results from the use of some of

those products. Also in the communications area, one of our

action teams has produced a CII Speakers Resource List that is

available to local user councils and any other groups who would

like access to participants of CII who are willing to speak on

a subject in an area where they have been involved. The goal is to make the programs from CII available to more and more

groups.

The primary thrust of our current implementation effort is

in the area of education. The education thrust is primarily focused on bridging the gap from the board room to the project

level. The principal effort has resulted in translating CII

research products int- education modules. The education

program concept is shown on this simplified graphic.

Essentially, pilot university short courses of one-week in

length are taught by combining six to eight different subject

areas or modules. The courses are targeted for experienced

project managers and are team taught by faculty experts and

industry practitioners. They are "piloted" in Austin near the

CII headquarters and are overseen by action teams formed around

specific subject areas. Each of these pilot courses is used to

develop the individual subject into completed "hard copy"

modules. A module then becomes a complete, "ready-for- instruction" package consisting of an instructor's guide, a

student's or participant's manual, and all audio visual

material, including slides and videos necessary for course

instruction. The modules are designed with adult learning in

mind and should maximize class interaction through workshops

and discussion.

Currently, 15 modules are at the end of their development

and production phase. The goal will be to use the modules in a

number of different ways. Individual modules can be used for

(1) in-company training programs, using in-house or other

instructors; (2) regional workshops at local user councils,

etc. normally half a day to a day in length; or (3) combined,

the modules can be used in short courses nationwide.

Currently, CII is building a network at regional universities

to participate in this program. The first two, Clemson and

Arizona State, will begin teaching these courses in September

and November.

To date, we have taught five sessions in Austin, with over

150 project managers in attendance. The education modules

under development are shown here, and a new set of topics which

include partnering, total quality, and contractual issues will

194
begin development in Fall of '92. The schedule for short

courses is shown with our next courses in Austin to be

available in the April and May time frame. The current level

of CII implementation activity is high, and we are excited

about the possibilities for seeing more widespread industry use

of CII products.

The question is where do we go from here? I feel that

total quality management offers much potential for our future

progress. At CII, you may say, we have "backed into" it. In

reviewing our history, we recognize the customer's needs. We

involved everyone in the process. Now we have developed

significant education and training programs. There is even

considerable talk about how we can benchmark best practices and

make that information available to the industry so we can all

continuously improve.

For implementation or technology transfer, there are many

barriers. There is difficulty with company policies, cultures,

reward structures, perceived loss of power, to name a few, but

TQM is changing that. It is causing folks to look at its

customers and its processes, and it is enabling and empowering

people to do something about it. Essentially, all TQM efforts

have some key core elements. These elements are customer

focus, an emphasis on processes, continual improvement and

innovation, people involvement, and management leadership. In

many ways, the bits and piece., of this are what we at CII have

been doing. In reviewing successful applications of our

products, all of these elements appear to be present.

Conversely and probably more extensively, the lack of success

of implementation or technology transfer efforts can be

attributed to situations where one or more of these elements of

TQM are missing. Just imagine how much more success we could

achieve in the transfer of technology if it were carried out in

organizations committed to TQM.

I would like to stand here and tell you that the staff of

CII is a corps of visionaries who have led the way to the

"alter" of TQM. No, our members are those who have been

adopting TQM in increasing numbers and have led the way. They

have grown into TQM, and their growth has just begun. They are

also telling us that this is the path. We are adapting to the

new industry standard. We are finding that instead of selling

our product, the environment for TQM creates a demand for it.

As organizations look to improve their processes, they need

solutions. If we have been working on the right thing, then

our products will fit the bill. If we haven't, they will go

unused.

So what does this have to do with infrastructure, which

generally translates to public sector projects? TQM has no

public/private sector limits. It is applicable to all

195
organizations and situations. TQM has as much applicability in the

public sector as in the private sector. It has as much

applicability in the research labs as it does in construction

companies. It is more important where the interfaces are

diffucult. Infrastructure, in general, is going to require

exceptionally astute use of limited funds, and "value-adding"

innovation as well. As long as the core elements of TQM exist

around infrastructure projects, then the potential for "valueadded" implementation is high. TQM will not just happen, but with

appropriate leadership, it can become a reality.

Examples of innovative applications. in TQM focused

organizations are emerging. In the Department of Defense, more

extensive use of partnering is emerging. Constructability programs

have started to catch hold in the Navy. At the state level, the

Arizona Department of Highways is aggressively pursuing partnering.

Even in our own city of Austin, a Malcom Baldridge Quality Award

has been offered for the first time, and yes, even in the

university environment, TQM is being strongly considered for

research, curriculum, and administration. A commitment to total

quality will enhance our ability to effectively transfer

technology.

196
Implemrentation of Innovation Mission

through Total Quality Management To Improve the total quality

and cost eff ectiveness of the

Jamis. A. Uroaddus construction Industry through

Cosrito IrmdUntry Insituate research and Implementation for the

purpose of providing a competitive

Chamaign Illnoisadvantage to American business In

March 4, IM the global marketplace.

C1I Structure C11 Owner Members

AT&T DwCha-.A LS.A.

Boad o uovesii r Preucla A Cho"WOk LL EUPentdo Nmnamn & C... M&

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Research implemrentato Liaison

CI1 Owner Members CI1 Contractor Members

(continued) An CE Sen~wsIn CAS Um Nmo Engmaw. M

0f Anfmega w. hm Pyrcbr a Ownw lcanpa AMC Hd&IW Mi& cun o""w.ws

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197
Cli Contractor Members Universities

(continued) "wramorafteisby mvewvV

wrpo. bes. U S V dchmdm ledin,* e aqmb g aor

am Ind.. 0110 8100610 -lrei ______ronSu U e

Josso Group. be. *W*M*S A WONO S CUP6.- Ijvw of dCdaen Shd"M " Mro U. W. WNib coiiwp.y Toor Mo. ewarb boubms dfteebmb Tuxas AM UtMoWuu~

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thea ares. Cox" ..

3

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Acad@#WaC11 Participation

Task Forces 450

Action Teams I50

ReerhCouncils 100

Committees 100

OWMM New

Level of Effort

(in millions of dollars)

C11 Budget I.5 Research

Volunteer Effort 24.5

Total 28.0

198
Sampling of Products Active Task Forces

•Constont•ablllty • IVmced Tedmaologlal saa

- Design Effectiveness •fW o iiv,,I.m

-Cost & Schedule Controls ct •OM~lr c 'D@@4 & Coar.• lmm

-Scope Definition •Ca nalicy Irmp alm

"* Project Organizaton C• lued" Mw

"* Materials Management constrcton Work Force

Cumurcgnu. Phoe U

-Contracting •uaca m&a Traknig

"* Risk Managemnnt •a. o*0a - • Wc ReilWt

"* Partnership

Souality •rnedondc Conabucon

Active Task Forces Task Force Cycle

(continued) (Nonn,

* Modumladon

* Oweli Year 0 - Task Force creation

0- Engineering Ogarzaton

* Project Team Buing Year I - Research plan definition

* Prolect Teem aJLlRwud Allocauon

•* Peraormnit c Year 2 - Research

* leetelt Prolscoi

* Tedwlogy Smwy Year 3 - Implementation planning

• Toaw Quoty mwe-eo

* U.& Novy Dmmaetration Prolect Year 4 - Implementation • 2am Aeddenbs

Bridging the Gap

Implementation

' 9N 9me

199
Cost/Benefit: CII Implementation History Maximum Use of CIVCICE Concepts

Summary Pamphlets011- et fns os

Impimemnutaion Committee OV810lc1 1`1*mc ormW*" is 10 to a U:1

OslNIVEffcllome 10 5 to 20 15:1

Product Review SIt~ ain.bu~ 10 5 to 20 15:1

Action Teamrsi tOM at 10 S to 15 10:1. bag.m ofEQum" S 8 Ito 0 1011

Education MMhSaG~M5 3tol 8 10:1

Cueeg~c~me5 3Sto 10 10:1

Long-Rang. Strategy Sy5 2 to 8 10:1

Implementation Process

Implementation Process Pursuit Areas

Products Implementatio Aontw010

Action Teams Action Teams

*Project Managemnent Education Module

*University Short Course

*Marketing .Project Organization Education

-Plants and Divisions Design Effectiveness Education

" Pilot roject Construclablllty Education

* Pilt ProectsSafety Education

"* Local User Council Supr Materials Managemnent Education

-Smal Prject QuaityManagemnent Education

* Smll rojct.Coeu/Schedule Controls Education

*Partnering Education

*Contracts Education

200)
Typical Company Product Catalog

c Produc CP"o - Publication abstracts A Cross-reference Index

CN Product Projc

KnonedVe ManUma t • Order form

CU Product Prorject

Appicece

Planning and Organizing

a CII Implementation Program

FWe

Pilot Project Products

" Definition * 31 Publications

" Consideration - 69 Source Documents

"• Overcoming barriers • 25 Special Publications

" Guidelines * 68 video tapes

-7 annual reports

201
Special

Manual for SjpaflProject Management CII Success Story Video

Contents

" Organlzatlon Solutions

"" 

"• In-roes 

haseGuidelines."CII 

Management Guidelines J Experience"

"* Revamp Profects

"* Contracts

"* Proet Controls

"* Total Ou•llhy anagement

" Safely

"* Environmen

CII Conferences CII Speakers List

"* Annual Conferance

- ClI participants

- new research products

- case studies - 100 participants

"* Construction Project Improvement (CPO) Conference - Olret sneems to speakers by LUCa/otheus

- attendees from CII and non-CO companies

- program similar to Annual Conference .Goal-expanded programs nationwide

"* Implementation Workshop

- for Implementation "champions"

- Implementation programs

CII Implementation C11 R

through Education Prouc, Moduk.

202
Cil Education Program Pilot Short Courses

Nineshe"7-8 modules taught In one week

Sessions:

-Targeted for experienced projct managers

Mod~te rainng Team taught by faculty & Indus"r

P"* Piloted In Austin

-Starting point for modul, development

* National application

Develaprnnt Producand DeploainaM

Education Modules Under Development Education Modules Under Development

-pimin -rlc eeAe311

Pvolsel Organiztio 1"iblaeb MIgeme1

Team Dynudcaroec 0-fty MeUUWA

-asan unetit C e- "

Prolect Olcoe m Wor packaging

Design Ebevewe nluuu for 5eUt1p

pmnwk"" mu Oblaclvee MiNtz prnn

trouts to Design hipwatOn proliSC Oulowne Tom oushy ieamgrnent

Constrcabilliy hien Ge

Iniprowingl PIojac Con,0110-101l1lly hoped on Types end Clauese.

"Adarizadon a PmaAseenebly me" Alocadon

Scheduled Short Courses Total Quality Management

Topics Dates Barriers

Project Organization May 17-2,.1992

Design Effectiveness September 1992 -Lose of control

Constructablitty November 1992 .Plc

Safety April 12-17,1ION * Culture

Material. Management June 21-26,1992 -Rewards structure

OualIty Managementr September 1992

Cost & Schedule Controls November 1992 -Industry applicability

203
CII TQM Task Force Total Quality Management

"* Implementation Guide for TOM in Potential

construction Industry Model

"* Lessons learned from 19 companies Reearch ImpIeet

* "Roadmap" for TOM

implementation-deployment flow chart t a

*Available.-Fail 92

Total Quality Management

Core Elements

• Customer Focus THE END - Process Emphasis

-Continual Improvement and Innovation

- Total Employee Involvement

- Management Leadership

204
10 May 1992

Technology Transfer and Marketing: Army-Style

Presentation at Infrastructure Workshop - 4 Mar 1992

Champaign, IL

by

Jeffrey J. Walaszek

Technology transfer means many different things to many people. Researchers often

equate it with publishing articles on research in scholarly journals. Lawyers define it as the

development of joint agreements between research laboratories and private sector

corporations. At the U.S. Army Construction Engineering Research Laboratories

(USACERL), we define it as getting our products into daily use by our many military and

nonmilitary customers. This effort is the same effort undertaken by private sector companies

trying to market their products to consumers.

We need to learn from our marketing counterparts in the private sector to improve our

ability to transfer technology. What we at USACERL are trying to do is to get people ý3 use

our products. Taking it a step further, what we're really trying to do is change people's

behavior -- to try to get our customers to stop doing things the way they're used to doing

them and instead doing it our way. In order to change behavior we first need to change

attitudes.

This paper will examine the barriers to adoption, provide an overview of a technology

management approach in the Army, and discuss a marketing approach to technology transfer

used by the Army.

Barriers to Adoption

The transfer of infrastructure research into use poses a challenge uncommon to most

government organizations. The challenge is to integrate new technologies into the daily

activities of the wide variety of public and private sector organizations involved in

infrastructure activities.

The literature provides a wide offering of reasons for the failure of efforts to transfer

technology to potential users. These barriers to adoption typically fall into three general

areas: ineffective communication, human resistance to change, and organizational and industry

constraints.

205
Ineffective Communications

Communications activities in support of technology transfer activities often fall short

in getting the word out to potential users and in presenting information of value to users.

Many people are simply not aware of the results of innovative research.

Another obstacle is that information may not be available at a time and place that is

convenient to the users. Information which does reach a potential user may go unnoticed if

the user has no immediate need for the technology. When a problem arises that could be

resolved by the technology, the potential user may not remember that the technology exists or

where to get information on it.

Another problem is that researchers do not present their findings in the form or

language that can be immediately translated into practice. The practicing engineer is more

interested in the practical applications of the technology over the methodology or significance

of the research.

The language used by researchers to convey information on a technology may not be

understood by non-research personnel. A researcher who devotes his or her life to a

technology will be intimately familiar with it. The practicing engineer who performs a wide

variety of duties may understand the concepts, but not have the detailed knowledge of the

researcher.

Another communications related issue is complaints that researchers do not fully

understand the needs of practicing engineers and others whose problems are seldom

communicated in terms of research needs. The end result is that the research community may

not be studying the problems which would directly assist the practicing engineers, or their

technology solutions may not fit in with the operational environment of the practicing

engineer.

Human Resistance to Changie

The ultimate goal of technology transfer activities is to produce a behavior change.

The user will change his or her work activities to use a new technology. However, many

efforts to implement new ideas and processes fail not because of the lack of good

technological planning or leadership, but because those promoting change fail to take into

consideration the human factor--the resistance to change.

Learning to use a new technology can be a very time consuming process. The

practicing engineer is under much pressure to complete a large number of tasks within a

limited time frame. Why should the engineer take the time to draw up new pavement design

plans for some new approach, when he can take some older plans off the shelf, make some

minor changes, and be done with it? Time spent on learning to use new technologies could

be viewed as nonproductive time by infrastructure engineers who are under much pressure to

justify their own productivity.

206
The risk in trying something new may prevent individuals from trying a new

technology which may not have a proven track record. Using a new technology requires a

financial commitment by the infrastructure engineer. If the technology fails to perform as

expected, the engineer will have to account for his decision to use the technology and may

have to seek additional funding to correct the situation. The use of funds by public agencies

is always under close scrutiny by various review organizations.

Organizational and Industry Constraints

Successful technology transfer is a management process which can be successful only

if the organization makes a commitment to conducting such activities. This commitment

towards technology transfer by the organization must consist of 1) the support of top

management, 2) adequate funding, 3) an effective organization supporting transfer activities,

and 4) cooperation from all elements involved both at headquarters and in the field.

Also, many of the infrastructure research products will be incorporated into military

facilities largely through the civilian construction industry. The construction industry is quite

diverse in the size of individual companies and the skills and resources they make available.

Numerous industry stindards govern the daily work of infrastructure activities.

Building codes, design guidance, and other technical documents governing

construction and infrastructure activities are often out of date. The process of updating such

codes and industry standards takes several years. Such documents do not allow the

consideration and application of innovative approaches. Infrastructure engineers are less

inclined to risk using a technology which is not accounted for under existing industry

standards or technical documents.

Another obstacle which prevents the use of new technologies is the ability to easily

acquire the technology through existing procurement processes. Some technologies are so

new that only one contractor can provide the technology or service for it. Government

procurement regulations are designed to promote fair competition for Government contracts

among potential suppliers of a service. Purchasing a service from a single supplier of that

service can be done within existing procurement procedures. However, engineers may not be

aware of these procedures, nor be willing to undertake the additional paperwork required.

Even when a technology is not limited to one vendor, finding qualified vendors

capable of providing an innovative service may be difficult. Army attempts to demonstrate

an innovative cracking and seating technique for pavement repair resulted in the Army first

having to train the contractor in the technique.

Another issue is why should the practicing engineer innovate. The profit motive of

the private sector often spurs innovation. Private organizations offer financial incentives to

employees to save money and improve efficiency. Often public employees actually have

disincentives to innovation resulting from headquarters requirements to review nonstandard

procedures.

207
Institutionalizing Change: The Army's Approach

Transferring technologies to potential users can best be achieved through a structured

process. Such a process ensures adequate time is spent in the development and testing of the

technology before transfer. The process also delineates actions needed to adequately transfer

technology to users. The process is used for infrastructure applications by the U.S. Army

Construction Engineering Research Laboratories (USACERL).

The research and development/technology transfer process consists of six steps.

These steps can be grouped into a research phase and a technology transfer phase. The first

three steps--problem identification, research, and development--make up the research phase.

The technology transfer phase consists of the last three seps--the field demonstration, the

product authorization, and product application. This process is shown in figure 1.

The innovation-development-transfer process begins with the identification of a

problem or Army need. Problems in the infrastructure area are identified for USACERL in a

variety of ways. User input is critical to the development and transfer of a technology. Input

is obtained from national teams of users, lab personnel, and headquarters sponsors of the

research.

The research on how to solve the problem occurs in the second step of the research,

development, and transfer process. Several possible solutions to a problem are investigated to

find the optimal solution to a technology. A lab-tested prototype is often the result of the

research effort.

Once the optimal solution has been identified and agreed to by sponsors of the

research, the technology goes into the development phase. User groups are used as needed to

provide input on the development of a product during this step. The technology goes from

prototype testing to a production version. The production version undergoes a rigorous pilot

test to ensure it meets the needs of the ultimate user. Detailed technology transfer plans are

developed during this step.

The field demonstration--step three--is designed to demonstrate the use and effectiveness of a technology in a wider and more visible application than the pilot test. It is the first

step in the transfer of the technology which is visible to potential users.

Once the value of the technology has been proven in the field demonstration, a

decision has to be made by someone to begin transferring the technology to potential users.

A prerequisite to the decision to authorize is the availability of support to the field.

USACERL has initiated a variety of mechanisms involving the public and private sector to

provide this support. Engineering guidance documents, industry standards, and building codes

will need to be updated during this phase to allow the use of the new technology.

During the implementation step, the technology begins to be used outside the field

demonstration sites. The technology transfer plan is put into effect in this step. This plan

consists of an extensive information or awareness program to inform potential users of the

208
existence of the technology, its applications, and sources of support. Additional components

of this plan include distribution of the technology, training activities and after-the-sale

support. Commercialization and support mechanisms worked out earlier are put into place in

this step to assist users in implementing the innovation.

The Imnortance of Demonstration Programs

The demonstration of an innovation at a field site is the first step in the transfer of the

technology which is visible to potential users. It takes the technology out of the research laboratory and places it in the real world environment of the user. The demonstration will

identify the benefit of using the technology, whether it be improved quality, time savings, or

cost savings. This information can be later used by others in deciding whether to adopt the

technology. Another important function of the demonstration is to gain information on

operational problems faced by users of the technology at demonstration sites. Insight can also

be obtained on the effectiveness of training and support mechanisms.

The Army has initiated several programs to facilitate the transfer of innovative

technologies into the field. Two of these programs directed towards the Army infrastructure

are the Facilities Engineering Applications Program and the Technology Transfer Test Bed

Program. These programs fund the demonstration of new technologies in the field and initial

technology transfer activities. Information from the demonstrations is then disseminated to

potential users to assist them in determining how the technology may be used locally.

The Facilities Engineering Applications Program (FEAP) is intended to transfer

technologies into Army use in the operations and maintenance of facilities. Engineering

personnel at installations are the primary users of these technologies. Steering groups for

each technology area provide input on the technologies, sites for demonstrations, and methods

for technology transfer.

Under FEAP, technologies are being demonstrated in seven technology areas: energy

conservation, building maintenance and repair, pavements and railroad maintenance and

repair, environmental quality, natural resources, corrosion, and management systems. Over

140 demonstrations have been conducted under FEAP since the program was initiated in

1984. These demonstrations cover over 60 technologies and more than 60 installations.

The Technology Transfer Test Bed (TITB) Program is directed towards transferring

technologies into the design and construction effort of the Corps of Engineers Divisions and

Districts. The TMTB program is patterned after the very successful Corps of Engineers

National Energy Team (CENET).

CENET consists of representatives from installations, Corps Districts and Divisions,

laboratories, and MACOM headquarters which form a National Team. The charter of the

CENET team is to facilitate the use of energy saving technologies in the field. The CENET

group identifies technologies for demonstration and recommends sites. The team also

provides input on research priorities.

209
Technology Transfer--The Private Sector Approach

Technology transfer is the term used by Government research organizations to describe

what the private sector calls marketing. The ultimate goals are very similar. Just as the

private sector attempts to convince housewives to purchase laundry detergents and other

household goods, the research community is attempting to convince engineering professionals

to use infrastructure related technologies. The only real differences are the sophistication and

cost of the product and the educational background and motives of the two consumers.

The private sector recognizes several elements which make up the marketing of

products. These elements together make up the marketing mix of product, price, place, and

promotion. The transfer of technologies consists of several related elements to include

product, production and packaging, distribution, promotion, and training and support.

The product has to meet some need of the consumer. An infrastructure product can be

a hardware item, a document describing the implementation of some innovative procedure,

software program and user manual, or just a different way of doing business.

The product has to be produced and packaged for procurement by the user. This

includes documentation or instructions to assist the user in applying the technology. The

production of a technology also implies the assignment of a price for purchasing the

technology. The price has to be perceived as being outweighed by the total benefits of using

the product. The packaged product has to be delivered to the user through some means.

The Army is in the process of developing a format for technology transfer plans which is

based on the commercial marketing approach. A draft of this format is provided as enclosure

1.

The Army has developed and implemented an aggressive marketing communications

program under the Facilities Engineering Applications Program (FEAP) to provide the

engineering personnel at Army installations with information on innovative technologies. The

communications strategy was designed to overcome some of the obstacles to technology

transfer identified through research. The program is implemented by Public Affairs (PA)

personnel at each of the Corps laboratories and the Army Engineering and Housing Support

Center.

The FEAP Information Center was established at USACERL. Working with PA

personnel at the Corps labs, the center publishes a quarterly technology transfer bulletin,

develops technology product fliers, distributes fact sheets, maintains technology transfer

exhibits, and manages a mail-in request service for loaner videotapes and information.

Samples of the newsletter, ad fliers, and the mail-in order form are enclosed.

Summary

Critical to the success of any technology transfer effort is the input of the customers --

the actual users of the technology. Customers need to be involved in the entire research and

210
development effort. Developing innovative products with the needs and input of the users

will go a long way to ensure the product meets their needs and will work within the

operational constraints of their environment.

211
Technology Transfer Plan (DRAFT)

Work Unit Title & Number

Date/Revision No:

Name of Principal Investigator:

Name of Technical Monitor:

Customers Served:

I. Demonstration

Briefly describe the FEAP, TTTB, or other means (such as

reimbursable projects or special arrangements) for demonstrating that the

technology can be used successfully by the customer and identifying the

actual benefits from field use of the technology.

II. Implementation Documents

Identify formal documents which will enable users to implement the

technology. Within the Army this would include Corps of Engineers Guide

Specifications, Technical Manuals, and Engineering Regulations. Other nonArmy mechanisms that may be applicable include professional society

standards, handbooks, and guidelines.

III. Availability/Commercialization

Can the technology be obtained by potential users? How will it be

packaged and distributed? Who will be responsible for doing this? If the

technology will be provided commercially, are there more than one vendors

who can compete to provide this service through Government procurement

processes?

IV. Customer Awareness/Promotion

Describe the promotional activities that will be used to inform and

motivate potential users to procure and implement a technology. These

activities will 1) generate an awareness of the existence of a technology

212
among potential users, 2) provide information on its uses and benefits, and

3) identify on procedures and sources of assistance for obtaining the

technology and related services. The ultimate goal is to provide information

to assist the user in making a decision to acquire the technology.

V. Support and Maintenance

Some organization or individual may need to be readily available to

assist users. Typically, such a center should be able to assist users with

questions over the phone, conduct onsite visits to assist with technology

problems, and provide them with updates or new information on the

product. Arrangements must also be made to maintain and update the

technology using input from customers.

VI. Training

Instructional material included with the technology may only serve to

get the user started on applying the technology on a limited basis.

Advanced training may need to be developed to further the user's knowledge

of the more specific applications of the technology. Special training courses

may also need to be developed for different types of users of the same

technology.

VII. Cost and Schedule Summary

The various implementation activities need to be scheduled in some

type of sequence to ensure successful implementation. For example, the

timing of the promotional activities typically should not precede the

establishment of mechanisms to distribute and support the technology.

Training materials and courses should be available when users are expected

to implement.

Calculate an estimate for the funding required for managing the

technology transfer of the products. Provide simple breakdown for one-time

items and then annual totals which include recurring costs (such as support

centers or technical centers of expertise). Additional consideration should

be given to funding mechanisms or programs to assist the field in acquiring

the technology.

Signature Signature

Laboratory Representative Proponent Representative

213
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USACERL, Public Affairs and

Marketing Communication

217-373-7216

27 February 1992

CPAR -- Construction Productivity Advancement Research Program

A cost-shared research program between the U.S. Army Corps of

Engineers and non-federal organizations to Jointly develop

technologies of interest-to the construction industry.

CRDA -- Cooperative Research Development Agreement

A joint research agreement between a Federal laboratory and

non-Federal partner to conduct a specific research project or

support technology transfer of a product.

FEAP -- Facilities Engineering Applications Program

A demonstration and technology transfer program to introduce

innovative technologies in support of operations and maintenance

activities for Army facilities.

MOU -- Memorandum of Understanding

An informal delineation of responsibilities pertaining to a

joint venture between organizations.

PLA -- Patent License Agreement

A formal agreement between a Federal laboratory and nonFederal partner which provide exclusive rights to a Federal patent

for commercialization purposes.

REMR -- Repair, Evaluation, Maintenance, and Repair Program

A U.S. Army Corps of Engineers research program supporting the

operations and maintenance of Corps civil works structures.

SBIR -- Small Business Innovation Research Program

A Federal program which funds the research and development of

innovative technologies initiated by small businesses.

SSC -- Strategic Support Center

An arrangement with a university or industry partner to

provide phone support & training to users of a Corps developed

technology.

TCX -- Technical Center of Expertise

Assignment of responsibilities usually to a Corps District or

Laboratory to provide design or technical assistance to other Corps

offices related to some specific innovation.

TTTB -- Technology Transfer Test Bed Program

A demonstration and technology transfer program to introduce

innovative technologies in support of the design and construction

activities at Corps Districts and Divisions.

215
Innowatiw Ideas for the Operation, Maintenance, & Repair of Army Facilities

TRANSFER TECHNOL OGY 

FACILIES ENGINEERINGps BULLETIN APPLICATIONS PROGRAM

Vol. 3, No. 92-I Winter 1992

DEH O&M Chiefs Railer Keeps Tooele's Railroad Network

Exchange Ideas on Track by Dana Finney

by Jeffrey Walaszek - fl anaging 104 miles of railroad RAILER is an engineered manage- S everal Chiefs of Operation and r track is no easy chore, but at ment system developed by the U.S. Army

Maintenance (O&M) Divisions Tooele Army Depot, UT, the track Construction Engineering Research Labofrom the installations met with personnel network is being maintained in top ratory (CERL) to help railroad track manat the U.S. Army Engineering and Hous- condition using the Railroad Mainte- agers allocate scarce maintenance and

ing Support Center (EHSC) to exchange nance Management System (RAILER). repair (M&R) dollars. The system comideas on how to improve technology bines inventory and inspection with a

transfer under the Facilities Engineering "Locating areas that need to be computer program to optimize M&R

Applications Program (FEAP). Eighteen repaired is so much faster than it used to spending. It has been fully implemented

participants traveled to Fort Belvoir, VA, be, mainly because of RAILER's track at Tooele under FEAP,with CERL turnlast summer for two week-long Technol- inventory," said Sam Hunter, former ing over the version 3.0 software in May

ogy Transfer Leadership Workshops civil engineer at Tooele. "The network is 1990.

funded under FEAP. divided into sections with permanent

marks to identify them. In the past, "This is the largest track network

The purpose of the workshops was to Tooele spent a lot of time hunting for the we've managed with RAILER as a FEAP

promote a dialog between personnel in problems that needed fixing, but now project," said Don Uzarski, CERL printhe Directorate of Facilities Engineering they can almost go straight to the spot- cipal investigator who led RAILER's

at EHSC and the O&M Chiefs at instal- within a few feet."

lation Directorates of Engineering and (See "RAILER" on page 3)

Housing (DEHs). Participants met with

EHSC personnel during breakout sessions to learn about FEAP innovations

and discuss issues facing the DEH in the

field. Several attendees also presented

innovative ideas they have implemented

at their posts.

(See "O& M Chiefs" on page 2)

New Product Fliers

in This Issue:

N Pipe-Loop System

* Noise Monitor and Warning

System

* Pipe Mole A two-man teann conducts the R4ILER survey.

Prepared IA WAR 25-30. Issued by: U.S. Army Construction Engineering Research Laboratory in cooperation with

U.S. Army Engineering and Housing Support Center

217
"O&M Chiefs" fto,, Page i meeting of the FEAP Executive Over- with papers, fact sheets, and draft user

sight Committee. O&M participants guides were excellent and will be highly

"The workshop introduced not only provided input along with Major Corn- useful at the installation," commented

new technology, but older technologies mand (MACOM) attendees on pro- Frank Cooper of Fort Jackson, SC.

new to me," said Leon Howard of Fort posed activities such as videoconferHood, TX. "The time was well spent and encing and a 3-year strategy. "I'm familiar with the FEAP program,

will improve my ability to operate effect- but it was good to get an update on 'how

ively in the field," he added. "The participants told us the user goes it'," said Vance Mitchell from Fort

guides are critical to our efforts to Lee, VA. "As these technologies mature

The workshops were specifically transfer FEAP technologies," said and prove themselves, we at the DEH

intended for branch and division chiefs Richard Kamey, FEAP Executive Dir- level need to be aware that 'this works,

with O&M responsibilities. "The O&M ector. -Their recommendations will this doesn't' so we can make decisions."

Chiefs are probably in the best position help us ensure the value of user guides

to influence decisions on adopting FEAP and that FEAP continues to be respon- Similar Technology Transfer Leadertechnologies at the installation," stated sive to the field." ship Workshops are planned for FY92. For

Dr. Robert Wolff, former Director of more information, contact Jeffrey

Facilities Engineering at EHSC. "We The workshop also served to intro- Walaszek at CERL, PO Box 9005,

wanted to specifically get them involved duce personnel at the different organi- Champaign, IL 61826-9005, COMM 217-

in the technology transfer process." zations attending. John Paris of Wa- 373-7216 or toll-free 800-USA-CERL

tervliet Arsenal, NY, stated, "One of (outside IL), 800-252-7122 (within IL).E

Most participants agreed that tech- the most useful things was establishnology adoption is their responsibility ing a network of contacts here at

and that programs such as FEAP are EHSC and the other installations."

needed. "As a whole, O&M Chiefs are Reasnor added, "I like to know the

continually in search of new technolo- faces, who does what, and what's

gies to counterbalance shrinking re- available."

sources ... this lends merit to FEAP,-"

said Gary Reasnor from McAlester Most participants commented that

Army Ammunition Plant, OK. the workshops provided valuable TECHNOLOGY

information and should be held again TRANSFER BULLETIN

in the future. "The take-away booksEdtr

In addition to exchanging information Editor:

on new technologies, another goal of the Dana Finney, CERL

workshops was to obtain input onl proposed FEAP initiatives. The first Contributors:

workshop group devoted a full day to Wayne Stroupe, WES

reviewing and commenting on draft Dick Broussard, CRREL

FEAP user guides. The user guides are Sherii Senffner, CERL

intended to provide DEHs with specific

information on the use and procurement Editorial Oversight:

of FEAP technologies. The second Torrie McAllister, EHSC

workshop group sat in on the annual Jeffrey Walaszek, CERL

FEAP PROGRAM MANAGER: FEAP MARKETING COMMUNICATIONS GROUP:

U.S. Army Engineeering and Housing Support Center Torrie McAllister CEHSC-P, Chair

Jeffrey Walaszek CECER-ZP

PROGRAM ADVISOR: Wayne Stroupe CEWES-LV

U.S. Army Corps of Engineers Directorate of Research and Development Dick Broussard CECRL-PA

FEAP INFORMATION CENTER: TECHNICAL PROPONENT CHAIRS:

U.S. Army Construction Engineering Research Laboratory Bernie Wasserman CEHSC-FU, Energy

Malcolm McLeod CEHSC-FU-S, Environmental Quality

FEAP PROGRAM MANAGEMENT GROUP: Jim Kemp CEHSC-FM-M, RPMA Management

COL John Motes II CEHSC-F, Program Coordinator Vic Diersing CEHSC-FN, Natural Resources

Donald Leverenz CERD-M, R&D Program Coordinator Bob Williams CEHSC-FB-P, Pavements and Railroads

Robert Gorham CECER-TAO, FEAP Coordinator Chester Kirk CEHSC-FB-S, Buildings

Richard Kamey CEHSC-F, Executive Director Malcolm McLeod CEHSC-FU-S, Corrosion

Torrie McAllister CEHSC-P, Chairperson, Marketing Communications

218
is improving. I'm especially pleased to Technologies of the type we've

see the favorable impact that FEAP is been demonstrating under FEAP hold

having on the application of new tech- the key to substantial cost savings in

nologies at Army facilities, maintaining and repairing Army facilities. And with today's fiscal conFacility engineers need every tool straints, we can't afford not to put

they can get to ensure that the technol- these innovative technologies to work.

ogy they implement will be the most

cost-effective choice over the long

term. The FEAP demonstrations have

produced real life-cycle data that helps

in making these decisions. Several JOHN MOTES II

FEAP technologies have shown im- Colonel, Corps of Engineers

COL John Motes 11 pressively rapid paybacks - some Director of Facilities Engineering

under 1 year. U.S. Army Engineering and Housing Innovation - Key to Support Center

As I visit you foilks at the DPWs

Efficient O&M and DEHs in the coming months,

please let me know what you think

about the FEAP technologies we are (Editor's note: With his assignment as

In my earlier experience as a DEH, publicizing. Is FEAP helping you with Director of Facilities Engineering for

I was often dismayed that we were its innovative ideas? How can we EHSC last year, COL Motes became the

relying on outdated management tools speed the technology transfer process? FEAP Program Coordinator.) U

and technologies. Today that situation

"RAILER"' front page I the depot. As at other Army installations, this track also has a

development. "The database was so role in the event of a national

large that we decided to split it into two mobilization. And as Hunter

parts to speed up the reports." However, points out, that role cannot be

he said this was easy to do with the data- taken lightly.

base management system used in the

program. "Last year, to support Operation Desert Storm, Tooele was

CERL completed the track inventory to transport a large amount of

in 1986 when the first version of RAIL- conventional munitions. The

ER was introduced at Tooele. The pro- RAILER inspection had identicedure involves complete documentation fied flaws in one of the tracks

and labeling of the existing track by designated for that purpose, but

breaking it down into track segments. the mobilization began before

Each segment has a unique letter-number they could repair them. As a recombination, depending on its location suit, the crew was greatly limited RAILER's sofwvare calculates a Condition Index

relative to a point of origin, because they couldn't make best for the track.

use of the damaged track."

RAILER's database can incorporate

results from commercially available rail Hunter noted that crews had to work For further information on

flow inspection equipment. "TThe X-ray day and night seven days a week to keep RAILER, contact Dr. Don Uzarski at

inspection showed several minute struc- up with the demand for munitions. The CERL, PO Box 9005, Champaign, IL

tural cracks in the rails that you couldn't unrepaired track could only handle small 61826-9005, COMM 217-398-5215 or

wee on the surface," Hunter said. "They loads at a maximum of 5 miles per hour. toll-free 800-USA-CERL (inside IL),

were really pleased that they had the 800-252-7122 (outside IL); or Scott

dhance to replace those rails before they "I think it's worth the time and money Thompson at EHSC, Fort Belvoir, VA

failed." to maintain our railroads," he said. 22060-5516, 703-355-3582. U

"RAILER lets us make the best decisions

The Toocle track network supports for allocating the resources to do that."

daily traffic for transporting supplies to 219
Technical Reports Videos, cont'd Polyscannf System - V-1O - ROOFER-Presents applications Automates Butthe following technical reports on and benefits of using ROOFER, a

U FEAP technologies have been pub- maintenance management system for Fusion Inspection

lished. These reports are available from built-up roofs.

the CERL Library, 217-373-7217: demonstration at Fort Hood, TX,

V-1I - Railroad Maintenance-A four- has shown the benefits of using an

* An Analysis of the System Installation part video that covers 1) Tie Renewal, 2) ultrasonic butt-fusion inspection system

Costs of Diurnal Ice Storage Cooling Spot Alignment, 3) Spot Surfacing a to detect flaws in joints connecting polySystems for Army Facilities, by C. Sohn Joint, and 4) Turnout Inspection. ethylene pipes. Marketed by T.D. Wiland R. Taylor, E-91/09. liamson, Inc., the Polyscann system can

immediately detect poor bonding, inade-

• Self-Help Service Center Manage- BLAST Ice Storage quate fusion, voids, and inclusions. After

ment System User's Manual, by J. Kirby the inspection, Polyscann issues a "flaws

et al., FEAP-ADP-P-91/38. Models found/no flaws found" report.

SRehabilitation of Military Training ime-of-use and demand pricing rate This technology replaces traditional

Areas Damnaged by Tracked Vehicles at I structures have sparked interest in destructive testing in which every fifth

Fort Carson, CO, by R. Hinchman et al., thermal energy storage technologies such butt-fused joint had to be cut out and

FEAP-TR-N-91/01. as ice storage. Three different diurnal ice tested in the field or at a laboratory. Constorage systems (DIS) were demon- nections where samples were removed

strated under FEAP with payback had to be re-fused.

New Videos for Loan periods as short as 4 years. However, the

return on investment can vary greatly, The ultrasonic system completely

he FEAP Information Center has depending on site-specific conditions. To inspects 100 percent of all fusion joints

added three new videotapes to its determine if a cooling storage system without damaging them. Flawed joints

loan library. To borrow these tapes, see would be feasible for your building, can be repaired, avoiding costly leaks.

the order form attached to this bulletin. HVAC equipment, and weather, you can

The videos are: now use the ice storage models available At Fort Hood, the system was used to

for the BLAST program. BLAST can inspect 13 butt-fusion joints in 8-inch

V-9 - Annual and Long-Range Work simulate any building with time-of-use polyethylene pipe sections that were

Planning With Micro PAVER-Intro- rate structures to show whether ice connected to an existing 8-inch natural

duces the most recent microcomputer storage would provide a savings. For gas pipeline. All of the butt-fusion joints

version of the Pavement Maintenance more information, contact the BLAST were inspected. Personnel from CERL

Management System. Support Office, 800-UI-BLAST or 217- and the Fort Hood DEH operated the

333-3977. * system during the demonstration.

The Polyscann system identified two

defects during the inspection. The imFEAP Executive Oversight Group mediate feedback let operators repair the

joints quickly and place the pipeline in

Steve Mason, U.S. Army Training and Doctrine Command service.

Ray Stoudenmire, U.S. Army Forces Command

Milon Essoglou, Navy Facilities Engineering Command The Polyscann system costs about

Rixie Hardy, U.S. Army Corps of Engineers, Directorate of Civil Works

COL John Knowles, U.S. Army Materiel Command $18,000. For more information, contact

Don Leverenz, U.S. Army Corps of Engineers, Directorate of Research and Orange Marshall at CERL, PO Box

Development 9005, Champaign, IL 61826-9005,

W.F. Marcuson III, U.S. Army Engineer Waterways Experiment Station COMM 217-373-6766, toll-free 800-

Eugene Marvin, U.S. Army Cold Regions Research and Engineering USA-CERL (outside IL) or 800-252-

Laboratory 7122 (i I t EHC ontact

David Moody, U.S. Army Construction Engineering Research Laboratory 7122 (inside IL). At EHSC, contact

LTC Earnest Robbins, U.S. Air Force Engineering and Services Center Malcolm McLeod, Fort Beivoir, VA

John Thompson, U.S. Army Corps of Engineers, Huntsville Division 22060-5516, 703-355-315 1. U

Ray Beurket, American Public Works Association

220
New Burners Have Low Nitrous Oxide Emissions

by Sherri Senffner

B oilers serving Army buildings can burners offer an excellent turndown burners do comply with the U.S.

now be upgraded with burners that ratio of 5:1, allowing continuous Environmental Protection Agency

ensure lower nitrous oxide (NOx) operation for low demands without (USEPA) NOx emission limits for

emissions. wasting energy by frequently switch- boilers under 100 million BTU per

ing boilers on and off. Potts says most hour capacity.

CERL began testing these burners conventional burners can achieve up

in FY90 at a dormitory heating plant to a 4:1 ratio at best. "Both comply," Potts says, -but

at Fort Knox, KY. In early FY91 a low low NOx burners release less concenNOx burner also was installed at a trated pollutants into the environsmall central heating plant at ment.-

Yakima Firing Center, WA, and

testing is scheduled to begin in CERL is still collecting longmid-FY92. term test data. The first short-term

demonstration, con-ducted at Fort

Preliminary test results show Knox in April 1990, proved the inthe burners emit approximately 35 stalled unit reduced NOx by 35

percent less NOx than conven- percent while burning natural gas

tional burners. It was also found - dropping from approximately

that the new burners are 1/2 99 to 64 ppm.

percent more efficient. This

relatively small increase offers a While the short-term data

10-year payback period. CERL shows only a small increase in efengineer Noel Potts says the ficiency, the new burners still

burners may prove to be at least I offer an attractive option when

percent more efficient - which replacing old burners because of

would reduce the payback period their low NOx emissions. More

to less than 5 years. than 600 Army boilers serving

single buildings or small building

"I believe it will prove more clusters could be retrofitted with

efficient because of its sensors," these low NOx burners.

Fort Knox boiler mechanic Ruel

Allen agrees. "If it senses excess For more information, con-tact

oxygen, it decreases air intake, and Noel Potts at CERL, PO Box

if it reads less oxygen, it increases 9005, Champaign, IL 61826-9005,

air." 217-398-5545 or toll-free 800-

USA-CERL (outside IL) and 800-

Unlike the conventional 252-7122 (within IL); or Satish

burners, the low NOx burners Sharma, EHSC, Fort Belvoir,

have a system that compensates Boilers can be retrofitted with a new type of VA 22060-5516, 703-355-3577.

for changes in combustion air burner that can reduce nitrous oxide emistemperature and pressure. This sions by up to 35 percent.

allows the burners to maintain an

optimum fuel-air mixture. Fuel is The test sites were chosen because

adjusted based on combustion air each had an identical pair of oil-/

pressure in the burner, according to natural gas-fired boilers allowing Coming Next Issue...

Potts. side-by-side comparisons of conven- FROM THE FIELD--

tional and low NOx burners.Exeornuatnad

Most Army bases have a demand Exterior Insulation and

for steam that fluctuates both season- Although the new burners emit Finish Systems

ally and during the day. Low NOx lower levels of NOx, conventional _1

221
Fort Harrison Expects Quick Payback

on New Steam Controller

Anew steam dispatching control

system (SDCS) being demonstrated at Fort Benjamin Harrison, IN,

may save up to $190,000 in its first y,, ar

of operation. CERL installed the SDCS

on Fort Harrison's district steam distribution system last year under FEAP.

In this steam distribution system, the

steam demand depends mainly on the

outdoor temperature. The SDSC uses a

temperature sensor interfaced with a

controller that dispatches just slightly

more steam pressure than is needed to

serve the most remote customer's

demand.

Steam dispatching

This strategy differs from traditional control system senses

district steam heating systems, which customers' needs by

maintain a constant steam pressure outdoor temperature

regardless of demand. The SDCS's lower and automatically

pressure means lower temperature, so adusts steami producthat energy is saved by reduced heat loss tion to meet the

and by lower steam losses through leaks demand

and faulty traps.

The SDCS at Fort Harrison cost abont For more information on SOCS tech- USA-CERL (outside IL), 800-252-7122

$180,000. If it continues to perform as it nology, contact Ralph Moshage at CERL, (within IL); or Bernie Wasserman,

has during the 8 months of the study, the COMM 217-398-5544 or toll-free 800- EHSC, 703 -355-2238. U

annual savings can be projected at

$190,000 for a simple payback of I year.

Comments? Reed Bed Dewaters Sludge, Leaves

Suggestions? Low Residuals

A 20,000 square foot reed bed system

Do you have a topic you would A n innovative sludge dewatering has been installed at Fort Campbell, KY,

like tou he feat pin aoupcomg system can end many of the prob- to demonstrate this technology. The reed

like to see featured in an upcoming lems experienced with conventional sand was planted in spring 1990 and was fully

issue of the FEAP Technology drying beds -- long dewatering times, grown as of summer 1991. The system is

Transfer Bulletin? An idea about media clogging, and weather vulnerabil- currently handling about half of the

how we might improve our ity, to name a few. sludge generated by Fort Campbell's 3 publication to serve you better? million gallon per day wastewater We'd like to have your input! A reed bed system uses the common treatment plant. The reed bed leaves a

reed Phragmites which is planted on a very low volume of residual that must be Please send your comments to: modified sand bed. Sludge is dewatered hauled away for disposal.

by drainage and evaporation, and the

FEAP Information Center reed stabilizes the organic matter. For more information on alternative

PERL.TBoxE9005Pdewatering technologies, contact Dr. P.O. Box 9005 Advantages of reed beds include low Byung Kim at CERL, COMM 217-373-

Champaign, IL 61826-9005 costs for: initial purchase, operation and 7281; or Malcolm McLeod, EHSC, 703-

maintenance, and sludge disposal. 355-3151. 0

222
Innovative

Ideas for the

Operation,

Maintenance,

& Repair of Army Facilities

Pipe Loop System

4,

Above: Compared with a new pipe, a pipe Insert from the Pipe

Loop System shows the effects of the water after a 90-day

period. Left: The Pipe Loop System In easily assembled with

off-the-shelf materials and mounted on a wall.

Inexpensive Technology Solves Expensive Testing Problem

PROBLEM: Testing potable water in distribution systems at installations is difficult and

expensive. Testing is required to determine:

"* Overall water quality, including lead and copper content

"* Optimal chemical treatment to reduce corrosion

"* Interactive effects of water and pipe.

TECHNOLOGY: The Pipe Loop System allows testing of multiple chemical treatments and their

effects on pipe materials.

DEMO SITES: o Fort Ord, CA - FY88 o Fort Bragg, NC - FY88

o Fort Irwin, CA - FY89 a Fort Lewis, WA - FY89

o Aberdeen Proving Ground, MD - FY89

BENEFITS: o Meets testing criteria of environmental regulations

a Extends the life of existing water distribution systems by providing information

needed to develop the least expensive chemical treatment that reduces

corrosion

9 Monitors test results easily and inexpensively.

223 EQ-4/M&y 91
Test Water Quality at Minimal Cost

Pipe Loop Solves Problem of Multiple Benefits Difficult and Expensive Testing * Determines overall effect of water qualiThe potable water supply at every Army ty on distribution systems

installation is different. Corrosive elements in

the water can cause severe deterioration of @ Operates with minimal supervision

pipes without chemical treatment. The Pipe

Loop System, developed by the U.S. Army 9 Allows side-by-side tests with chemicals

Construction Engineering Research Laboratory to determine optimal amount of chemi-

(USACERL), allows water plant personnel to cal additive, thereby improving the

test the amount and effects of various water water quality and extending the life of

treatments on different pipe materials at specific the water distribution system

sites with minimal effort and expense.

e Helps installations meet evaluation criA Pipe Loop System can be built using off- teria of environmental regulations:

the-shelf materials and mounted on a 3-foot x

4-foot board on a wall. The water flow * National Interim Primary Drinking

through the system can be easily controlled and Water Regulation (NIPDWR)

quantified. Pipe material samples in the form

of pipe inserts and coupons are easily removed * Safe Drinking Water Act

and evaluated.

• Copper and Lead Rules of the Clean

The design allows distribution system mate- Water Act

rials to be placed in direct contact with water

under conditions simulating typical operation.

It also allows water chemical treatments to be Available Through Exclusive

tested before actual use. The chemical treat- Ucensing Agreement

ments may be tested individually or in side-byside comparisons. USACERL Technical Report N-88/12 (1988)

describes the development and evaluation of the

Pipe Loop System. Installations can purchase a

Pipe Loop System Widely system through Evans Machine & Tool Co., 410

Demonstrated Summit Ave., Perth Amboy, NJ, (908) 442-

1144, with whom USACERL has an exclusive The Pipe Loop System was demonstrated at licensing agreement.

five Army installations. At Aberdeen Proving

Ground's Edgewood water treatment plant, the

Pipe Loop System was used to develop an

optimal water treatment for reducing lead dis- Points of Contact

solution. The testing represents a protocol for

meeting the testing requirements proposed by Richard Scholze, U.S. Army ConstrucEPA in 1988 for evaluating options that reduce tion Engineering Research, Laboratory,

lead and copper dissolution from household P.O. Box 4005, Champaign, IL 61824-

plumbing. 4005, COMM 217-373-6743; or Malcolm

McLeod, U.S. Army Engineering and

The Pipe Loop System at Fort Bragg, NC, Housing Support Center (USAEHSC),

is saving the installation money. Not counting Fort Belvoir, VA 22060-5516, COMM

the potential maintenance savings, Fort Bragg 703-355-2003

estimates that they have saved approximately

$15,000/year by determining the optimal water

treatment using the Pipe Loop System. Without sacrificing water quality, the amount of

chemical additives was reduced, thereby lowering chemical and labor costs.

Issued by USAEHSC, Fort Belvoir, VA, LAW 25-30. Additional copies are available from the

FEAP Information Center, P.O. Box 4005, Champaign, IL 61824-4005, phone 217-352-6511 x386

224
Innovative

Ideas for the

Operation,

Maintenance,

F & Repair of

A Army Facilities

Noise Monitoring and Warning System r.. ,"%,,'nrw'nIt ra!•W,. ,-L,LP "•S- ••

• .3

Above: Realistic training requires use of equipment that can produce blast noise. Top right: A microphone Installed outside the post picks up noise levels; this is the monitor for

the Noise Monitoring and Warning System. Lower right:

The range officer Is notified Immediately if noise levels

are too high.

Noise Monitor Promotes Community Relations

PROBLEM: Noise from training activities on Army installations annoys residents of

nearby communities; in some cases, public pressure threatens to shut

down training.

TECHNOLOGY: The Noise Monitoring and Warning System uses a remotely placed

microphone and a "smart" monitor to detect and record noise levels in

areas where blast noise occurs.

DEMO SITES: Fort Richardson, AK--FY86 Aberdeen Proving Ground, MD--FY86

BENEFITS: * Correlates complaints from community with specific nois- -.,oducing

activities to help the base develop effective noise mitigation strategies

@ Helps verify compliance with established noise-zone standards

e Identifies whether training activity is the actual noise source.

22,,5 EQ-3/May 91
Noise Monitor Helps Installations Respond to Community

Noise Data Supports Efforts reschedule or relocate activities as needed to reduce the

to Reduce Training Noise noise. Another important finding was that the actual

noise source could be identified: at Fort Richardson,

The days of isolated military posts are long past with about 50% of the complaints were called in when no

the spread of urban communities into areas previously training was in progress; instead, it was found that the

unpopulated. Termed encroachment by DOD, this trend noise was generated offpost at a highway construction

of siting civilian dwellings near installations has intro- site.

duced some problems that most neighborhoods never

face. Finally, the Noise Monitor and Warning System improves community relations in two ways. FLrst, by

Noise is among the most sensitive issues between the introducing this system and explaining its purpose to the

installations and their neighbors. Many mission-critical public, the installation shows it is making a good faith

activities such as training and vehicle maintenance pro- effort to address noise problems. Second, by having

duce noise that may be annoying to members of the immediate feedback on the noise level, trainers can stop

community. activities that could produce noise complaints, thus

reducing the frequency of noise problems in the commuThe Noise Monitoring and Warning System gives nity.

range officers a tool to manage noise-producing activities. The system uses microphones connected to a con- Cost

troller panel. The microphones are installed on poles at

field stations in or near the area where noise could be a A controller panel can accommodate up to 60 micproblem. The system detects and records noise levels rophone connections and costs S5000 to $7000. Each

automatically. A software program interprets the data field station where a microphone is located costs

by comparing it to a preset level and isolating it from $36,000; this cost also covers consulting to determine

the background noise. The source noise level, in deci- the best site(s) for the stations and site preparation (e.g.,

bels, can be retrieved by a telephone call, or the con- installing poles). The total system cost varies, dependtroller can be programmed to send the DEH a notice if a ing on the number of field stations the installation

certain noise level is exceeded. needs.

Demonstration Validates System Procurement Information

The FY86 demonstrations at Fort Richardson, AK, The noise monitor is available from the U.S. Army

and Aberdeen Proving Ground, MD, had two objectives: Construction Engineering Research Laboratory (USA1) to determine the learning curve for installation per- CERL); see points of contact below. For more informasonnel who would be using the system and 2) to prove tion on the system or demonstration, a technical report

that data from the system could be correlated with range can be ordered from USACERL: An Army Blast Noise

operations and complaints received from the community. Monitoring and Warning System, TR-N-88/03. Potential

users are also encouraged to contact the demonstration

Both objectives were met successfully. Installation sites to learn more about the system and its applicability

personnel were able to use the noise monitor with about to a specific installation.

2 hours of training; instruction was provided onsite at

the time the systems were installed. Points of Contact

Benefits Dr. Paul Schomer or Mr. Jerry Benson, USACERL,

PO Box 4005, Champaign, IL 61824-4005, COMM 217-

Installation noise levels are set by DOD and Army 373-7229 or -7253, toll-free 800-USA-CERL (outside

regulations, and must conform to the Installation Corn- IL) or 800-252-7122 (in the state). Mr. Malcolm McLepatible Use Zone (ICUZ) program. The noise monitor od, U.S. Army Engineering and Housing Support Cencollects data that allows installations to 1) meet these ter, COMM 703-355-2003. LTC Hans Graven, Army

criteria and 2) prove compliance. Environmental Office, 703-693-4635.

The demonstrations showed that noise levels from

specific activities could be correlated with complaints.

This information allowed training coordinators to either

Issued by USAEHSC, Fort Belvoir, VA, IAW AR 25-30. Additional copies are available from the

FEAP Information Center, P.O. Box 4005, Champaign, IL 61824-40(L5, 217-352-6511, ext 386.

226
Innovative

Ideas for the

Operation,

Maintenance,

& Repair of

Army Facilities

Pipeline Insertion Method (PIM)

~ ~ ~ --. ~. ~ Top left: impact male just before connection to

HOPE pipe, showing air line Inside HDPE pipe.

* .. ~ -~ Bottom left. Impact mole bursts s cast Iron pipe ., . ~ and forces It Into the surrounding *oil. Above:

SHOPE pipe Is Inserted Into the pit.

Replace Buried Pipes With Minimal Site Disturbance

PROBLEM: Replacing underground pipes by digging trenches often disrupts local activities and

incurs high costs for restoring damaged surfaces.

TECHNOLOGY: The pipeline insertion method (PIM) has an impact mole that breaks up existing

pipe in the ground and forces fragments into the surrounding soil. It then replaces

the old pipe with a high-density polyethylene (HOPE) pipe.

DEMO SITE: Fort Belvoir, VA - FY87

BENEFITS: e Replaces old pipe with a new one of equal or larger diameter

* Can be used in areas where digging is difficult or impossible

*Avoids interruptions to traffic and other operations

Minimizes the cost of surface restoration

* Applies to any brittle, fracturable pipe--including sewer, water, and gas lines

2op wh iEosiApr 91
Trenchless Pipe Replacement

PIM: The Technology can be expected to be up to 44%, depending on

surface conditions which are site-specific.

There used to be only one way to replace a buried pipeline: dig it up, tear it out, and install a PIM's Benefits

new one. This process can be very expensive, with

much of the cost tied up in restoring surfaces dam- The Fort Belvoir FEAP project successfully demaged during digging. onstrated several of the pipe mole's benefits, which

include:

Today an alternative to this trenching process is

the pipeline insertion method (PIM). Nicknamed * Limits disruption to the landscape and adjathe "pipe mole," this technology breaks up an exist- cent structures

ing pipe while it is still in the ground and replaces

it with HDPE pipe of equal or larger diameter. * Avoids interruption to traffic and other local

PIM requires very limited digging at every other activities

manhole, for lateral connections, and where the

mole exits. . Easily corrects hydraulic overloading by inserting larger diameter pipe

The pipe mole looks like a missile with four fins.

It carries a pneumatic hammer in its nose which e Reaches areas hard to access even by digliterally bursts its way through an old pipe while ging--easements, rough terrain and sites

dragging the new pipe behind it. The mole is air- with limited work surface

driven. A hydraulic jack "pushing machine" behind

it feeds the new pipe. A cable is attached to the e Improves safety to workers and local resifront of the mole and to a winch that guides it dents.

through the pipe. In addition to the pneumatic

pipe mole, a hydraulic model is now available. Gaining Acceptance

Fort Belvoir FEAP Demonstration First developed in Great Britain, PIM is becoming widely accepted in the U.S. for replacing and

At Fort Belvoir, VA, a 240-foot section of sewer upsizing all types of buried pipes (water, sewer,

pipe was replaced using PIM technology. An 8- gas). PIM is patented and marketed in the U.S. by

inch main sewer line replaced an existing 6-inch PIM Corp., Piscataway, NJ. USACERL technical

main that traveled between two manholes and report N-89/07 (April 1989) describes the Fort

under two parking lots, one well traveled street, a Belvoir demonstration in detail. A technical manuretaining wall, and a fence. None of these struc- script on the technology is also available from

tures was disturbed. USACERL.

The demonstration included tests to determine

the mole's effect on adjacent utilities. Results for

stress on adjacent pipes, vibrational damage, and Points of Contact

pipe deflection were all in acceptable ranges.

Richard Scholze, U.S. Army Construction

Saves Excavation, Replacement Costs Engineering Research Laboratory, PO Box

4005, Champaign, IL 61824-4005, COMM

With trench pipe replacement, site restoration 217-373-6743. Malcolm McLeod, U.S.

accounts for up to 80 percent of the total project Army Engineering and Housing Support

cost. Thus, PIM brings the highest savings to job Center (USAEHSC), Fort Belvoir, VA

sites where surface restoration will ccst the most. 22060-5516, COMM 703-355-2003.

For example, 1989 replacement costs for a hard-toreach easement averaged $100 per linear foot using

PIM, depending on the length of pipe replaced and

other considerations for upgrading a 6-inch to an 8-

inch sewer line. The savings over trench-type work

Issued by USAEHSC, Fort Beloi, VA lAW AR 25-30. Additional copies are available from Ow FEAP Infomatob

Center, PO Box 4005, Champaign, IL 61824-4005, phone 217-352-6511, ext 386.

228
Innovative Ideas for the Operation, Maintenance, & Repair fT Army ENG INEERIN

FACILITIES ENGINEERING

APPLICATIONS PROGRAM

Information Order Form

The FEAP Information Center has a wealth of information on FEAP technologies to share with you. If you are interested in learning more about a FEAP demonstration, please complete this order form and mail to:

FEAP Information Center or call:

USACERL/ATTN: CECER-ZP COMM 217-352-6511 ext 386

P.O. Box 9005 800-USA-CERL (outside IL)

Champaign, IL 61826-9005 800-252-7122 (inside IL)

FACT SHEETS - one-page information sheets on the status of FEAP technologies

FEAP-1 The Facilities Engineering NRG-19 i ligh-Itliciency I leating Unit Conversion

Applications Program NR&-20 Underground Sleam I)istrihution System

NRG-21 Steam I rap Demonstration at Fort Ord, CA

Building Technology Demonstrations NRG-22 I ligh-Efficiency/Low NOx Dual Fuel

Burner System

BDG-1 Voice-Activated Inspection System

(VAIS) Environmental Quality Technology Demonstrations

BDG-4 PolyscannR Butt-Fusion Joint

Inspection System ENV-2 Improved Sludge Dewatering

BDG-11 Roof Blister Vents Technology

ENV-5 Pipe Loop System

Corrosion Technology Demonstrations ENV-6 Sludge Freezing Bed

ENV-10 Innovative Waste Treatment at

COR-1 Anliscale/Corrosion-Resistant Coating Remote Sites

for Heat Exchangers ENV-1 1 Hazardous Waste Management

COR-2 Copper Pipe Rehabilitation Information System

COR-3 Cathodic Protection (CP) Diagnostic ENV-12 Modeling Water Quality Degradation

System in Water Distribution Systems

Energy Technology Demonstrations Management Technology Demonstrations

NRG-1 Diurnal Ice Storage Cooling Systems MGT-1 Interactive Automated Telephone

SNRG-2 Infrared Radiant Heat Effectiveness Response System for DEI-I

SNRG-8 Small-Scale Packaged Cogeneration MGT-2 Work Management System

System

NRG-9 Microprocessor-Based Combustion Natural Resources Technology Demonstrations

Optimization for Packaged Boilers

NRG-10 Retrofit of Single-Loop HVAC Control NAT-2 Techniques for Cost-Effective

Panels Revegetation of Cold Regions Facilities

NRG-1I Installation Steam Dispatching System NAT-3 Prescription Athletic: Turf for Cold

NRG-13 Ground-Coupled H-leat Pumps Climate Parade Iields

NRG-14 Low-Temperature Ilot Water Heat

Distribution Systems Pavements & Railroads Technology Demonstrations

NRG-15 Retrofit Lighting

NRG-16 Heat Recovery in Industrial Facilities PRR-1 New MicroPAVI R lechnology

NRG-17 High-Temperature [lot Water System PRR-2 Nondestructive Pavement I valuation

Demonstration PRR-3 Paving Blocks

NRG-18 Standard Interface for DDC/LJEMSC PRR-7 Railroad Track Maintenance

in UJSAR[2UR Facilities Management System (RAIl [R)
PRR-4 Geotextile Applications PRR-1 1 Pavement Drainage: Open-Graded

PRR-10 Technology Application Process Base

FEAP Fact Sheet Book - - Collection of all FEAP Fact Sheets.

VIDEOTAPES - To borrow a videotape, please check the desired size. If you would like a personal copy, please make

one and return the tape to us. Do not distribute or sell the tape to others.

(VHS)

V-1 Instructions for the Use of the Army Paint Test Kit 1/2' 3/4'

V-2 Structural Enhancement of Railroad Tracks - 1/2' -3/4'

V-3 Fuel-Resistant Pavement Sealers - 1/2' -3/4'

V-4 Potholes: Causes, Preventions, and Cures - 1/2' 3/4"

V-S Dustproofing - 1/2' 3/4'

V-6 Repair of Concrete Water Storage Tanks - 1/2' -3/4'

V-7 Repair of Concrete Footings and Structures - 1/2' -3/4'

V-8 Reroofing With Protected Membranes - 1/2' -3/4'

V-9 Annual and Long-Range Work Planning With Micro PAVER - 1/2' -3/4'

V-10 ROOFER - 1/2N -3/4'

V-1I Railroad Inspection (Four Parts: Tie Renewal; Spot Alignment;

Spot Surfacing a Joint; Turnout Inspection) - 1/2' -3/4'

PRODUCT FLIERS - One-page, full-color 'ads' describing technologies that have been demonstrated successfully

under FEAP and are ready for implementation.

PR-1 Dustproofing - BD-3 Protective Membrane Roof

PR-2 Pothole Patching S BD-5 Fire Protection Management System

PR-3 Railroad Track Inspection (FIRMS)

PR-4 Cracking and Seating - ET-1 Diurnal Ice Storage

PR-5 Asphalt Stabilization of Railroad Track - ET-2 Condensing Heat Exchangers

PR-6 Geotextiles - ET-3 High-Efficiency Boilers

PR-7 Fuel-Resistant Sealers - ET4 Photovoltaic Power Systems

PR-8 Installing Pavement Crack and joint - ET-5 Exterior Insulation and Finish Systems

Sealants - EQ-1 Remote Site Latrines

PR-9 Asphalt Rubber and Geotextile - EQ-2 Trickling Filters

Interlayers for Pavement Overlays - EQ-3 Noise Monitor and Warning System

SCT-1 Ceramic Anodes - EQ-4 Pipe Loop System

MG-1 Automation of Self-Help Program - EQ-5 Geographic Resources Analysis

BD-1 Paint Test Kit Support System (GRASS)

BD-2 EPDM Roofing - EQ-6 Pipe Mole

NAME

TELEPHONE

230
SUMMARY OF WORKING GROUP DISCUSSIONS

Group A: Identification of Potential Areas and Opportunities for Innovation in the Public Works

Infrastructure (PWIS)

Participants

Prof. Arthur Baskin

Prof. John Eberhard

Dr. Francois Grobler (Recorder)

Dr. Andrew Lemer

Prof. Joseph Murtha (Chairman)

Prof. Michael Walton

Prof. Thomas White

Mr. Ronald Zabilski

The meeting started with introductions of group members, clarification of the group's goals, and

discussion of the most productive approach to achieving the group's goals.

The following outline was suggested as a framework for the discussions:

1. The definition of a template or matrix to use in the identification, characterization, and

prioritization of opportunities for needed innovation.

2. Review of important innovations presented in the prepared papers.

3. Identification of applicable innovations existing in other disciplines.

4. Group preparation for a plenary presentation.

The group discussed what innovation is and accepted John Eberhard's suggestion to distinguish

between ideas, inventions, and innovation.

The group defined innovation as:

A product, process, or procedure successfully introduced into the marketplace to

significantly reduce cost and time lines, to improve quality, or to increase performance

desired by the public.

It was also pointed out that innovation can occur in different areas, including:

I. Management and Information Systems

2. Policy

3. Standards

4. Products and Materials.

Some group members felt that 15 percent perceived improvement is the minimum threshold before

an innovation will find acceptance. At 30 percent improvement innovations "take off" in the marketplace

without help.

231
After addressing these initial matters, the group continued its discussions of innovation in the

public works infrastructure. These discussions were diverse and searching, but can be roughly grouped

under the following issues:

How to achieve acceptance and implementation of innovation

The need for help with documenting the current status was recognized (i.e., how providers of

PWIS can improve the accuracy of the documentation of current cost, performance, etc.). Further help

is needed to evaluate and estimate the benefits and performance of innovation. Even if help can be

provided, the question still remains: "By whom will the risk be taken?"

Assumption of the risk of innovation

Risk is inherent in the implementation of innovation. Current legal and professional liability

provides strong disincentives to designers to try innovation, and most political decisionmakers, it was felt,

would rather avoid PWIS investments that have a high potential benefit, but could be unsuccessful. The

solution was seen as an assumption of the risk of innovation at Federal, State, and local government levels,

and the following proposals were made:

1. Research. Some group members suggested that a central research institution - similar

to a Rand Institute - is needed to conduct high-potential research considered too risky,

expensive, or broad to be performed through the existing research channels. It was pointed

out that most other developed countries have such central institutions (at least for

construction in general). Many of the most developed countries are developing programs

to actively market and commercialize the research products from such laboratories,

thereby recovering some of the government funding risked on innovative research.

2. PWIS Bank. This bank would fund PWIS projects considered too risky to attract

funding through normal channels. The funding would be derived from an initial Federal

grant, and supported by contributions by State and local governments. Simultaneously,

a program should be created to provide incentives for the implementation of innovation

in a fraction of PWIS projects.

3. Risk Assumption. In small or unsophisticated communities with limited resources,

risk-taking can be promoted through the availability of funding, as the World Bank is

enforcing international standards in Third World countries.

Lessons from the transportation industry

The group considered transportation, among the PWIS industries, as the best model of innovation

implementation. It was stated that transportation is unique in the funding it derives from the taxation of

gasoline and other fuel products, and that other PWIS components do not have such lucrative sources of

funding.

The Intelligent Vehicle Project was cited as an example of a successful innovation project, but it

was emphasized that this project was not "sold" on the basis of transportation, but rather exciting

technology. While this is an example of risk assumption at various levels of government, it clearly

demonstrates the importance of careful planning of the presentation and approach of innovation. The

lesson is that a clear constituency should be identified and carefully nurtured. The message of innovation

should be communicated in "an exciting, grand way," and the process of partnership building should be

emphasized throughout.

232
A pragmatic approach to dividing the overall PWIS spectrum should be followed, since too much

needs to be done to be accomplished in one gigantic project. Some overlap of segments is needed, such

as with the airline industry, which had very little input to the Maglev train initiative, yet both serve

intercity public transportation.

Information systems

Developments in information systems were seen as an opportunity to change the "way people do

business." Research is needed to determine the best use of information systems, and how to integrate

them into the business. It was commented that proactive information systems are needed (i.e., systems

which will watch their data and initiate appropriate action).

Perspective from the construction industry

From this perspective, innovations should be targeted to specific benefit groups (i.e., owners,

designers, contractors, or suppliers/manufacturers of materials) or should address intergroup issues. The

Construction Industry Institute was successful, it was felt, because it created a market for itself by bringing

construction owners and practitioners together.

Innovation should specifically be focused on the project initiation phase, where the most potential

benefit can be derived. It was acknowledged that the current legal and competitive bid environment make

changes difficult in PWIS. It was strongly suggested that attention should be given to changing the

practice of typical competitive bidding in PWIS.

An example of partnership was cited, where the City of Albuquerque, NM, hired one of the group

members to help create a public works consortium of local government, PWIS consumers, and designers

and constructors of PWIS.

Performance contracts were also examined and recommended as more appropriate in PWIS.

Ehrenkrantz, who required "clean floors for 20 years" in his New Jersey school procurement experiment,

is often mentioned as a proponent of performance contracting.

The desirability of equity holding by the constructor of a facility was considered next. Among

elements of PWIS, only the electrical power industry came to mind, where there are some constructors

who are also equity holders. This concept was looked upon favorably by the group, and it was recalled

that toll roads are often better maintained than other roads. It was envisioned that cities could arrange to

have elements of PWIS constructed, owned, and operated by private companies, based on performance

requirements.

Sharing and dissemination of innovation and information

Electronic meeting systems enable designers to proceed simultaneously on design in different

locations. It was reported that the design of Japan's Osaka Aquarium proceeded around the clock between

Japan and Boston using electronic communications. It was pointed out, however, that integration problems

persisted and organizational barriers were still formidable.

A better way of disseminating innovation was considered. In pursuing this topic the effectiveness

of a Dutch example was reported. The Dutch government sponsors high-level workshops, to which

international experts are invited, expenses paid, and generously compensated. The best ideas from this

forum are then rapidly integrated into Dutch research or industry, thereby saving much time and money.

"13
Concluding thoughts

The chairman asked each group member for their concluding thoughts on areas of innovation in

PWIS. The following points are a summary of these thoughts:

Biotechnology - could be applied to municipal waste, air pollution, and high production

of wood for construction.

Modularization - should be pursued in PWIS design and construction.

Education -- Universities do not produce engineers with the needed interdisciplinary

approach to problem solving. Innovative programs for creativity and integration are

needed.

PWIS workshops - should be arranged with participants from broadly diverse

backgrounds to examine problems in PWIS. The point was made that PWIS is "ripe for

real creativity."

Leadership - is needed in the whole area of PWIS.

Focus of innovation --The most benefit can be derived from focusing innovation at the

beginning of project phases.

Demonstration projects - are needed to demonstrate technology in a manner that would

not create disastrous consequences for individual communities.

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Group B: Barriers to Innovation, and Recommendations To Overcome Them

Participants

Mr. Joel Catlin Mr. Charles Seemann

American Waterworks Association (AWWA) Parner, Deutsch, Kerrigan & Stiles

Dr. Diego Echeverry Mr. Jesse Story

U. S. Army Construction Engineering Federal Highway Administration Research

Laboratories (FHWA)

(Session Recorder) (Session Chairman)

Mr. Carl Magnell Mr. Richard Sullivan

Civil Engineering Research Foundation (CERF) American Pubic Works Association (APWA)

Mr. Benjamin Mays

Government Finance Officers Association

(GFOA)

Issues discussed

The group started the discussion by trying to define the term "innovation." It was agreed to define

innovation as any idea that is new to somebody, even if that idea has been known and used by others in

the past. For example, the APWA has had experience with ideas used for years by public works managers

in one area, but totally unknown to managers in other areas. These ideas are innovative to the group of

managers for whom they were unknown. Similarly, the GFOA has seen innovative financing ideas based

on old financing alternatives that may become attractive once again.

The discussion focused next on identifying barriers that challenge innovation in the public works

infrastructure, and trying to provide recommendations to overcome these barriers.

Legal barriers were mentioned first as an important obstacle to innovation. Examples of these

barriers occur in design, specifications, etc. This resistance to change is mainly due to risk aversion (what

if the innovative ideas fail?). A recommended avenue to tackle this obstacle is to legitimize innovation

in design, specifications, etc., via peer review. Professional associations like the National Society of

Professional Engineers (NSPE), the American Association of Civil Engineers (ASCE), and the American

Institute of Architects (AIA) can facilitate the utilization of new ideas through peer validation.

In the opinion of a discussion participant, the biggest barriers for innovation in public works are

related to financing and legal issues. For example, there are stringent limitations for the use of tax exempt

debt to finance projects that have some private participation. Another dimension of this obstacle is the

difference in regulations from state to state affecting the diffusion of innovative financing alternatives.

At this point another discussion participant intervened to mention that there are innovative

management practices that have less obstacles for their application. New management practices, as

opposed to new technological ideas or new financing alternatives, can be easier to adopt and implement.

235
The APWA has been very successful in disseminating innovative management practices among its

members.

The discussion moved into the issues of vision and changing the mindset. If there is an adequate

vision that fosters a positive mindset towards innovation, then innovation becomes normal and not the

exception. A participant responded that this change can be achieved with incentives that promote

innovation. For example, an ideal scenario was described where a designer was motivated with the

incentive of a share of operations and maintenance (O&M) savings to make design improvements.

The major disincentive seems to be risk. Innovative ideas are inherently risky. A mechanism

should be created to allow risk reduction for different participants. Providing incentive to innovate by

minimizing risk could be a role of the Federal Government.

Another disincentive for innovation in the public works infrastructure is the high visibility of

failures involving innovative ideas, coupled with the lack of exposure of successful cases. Although media

coverage of failures is unavoidable, the successful application of innovation should be promoted.

As mentioned, the public works infrastructure suffers from a visibility problem. Another facet of

this problem is that it is normally taken for granted until it breaks down. This is compounded by the

longevity of the different components of the infrastructure (i.e., roads, water lines, etc.), which can last

several decades. On one hand this can be detrimental at the moment of constructing an infrastructure

system, because the decisionmakers know that the constructed facility will likely last well beyond their

retirement. On the other hand the public is used to "inheriting" an operational infrastructure. This may

promote an "if it ain't broke don't fix it" attitude. It is believed that these issues can be addressed via

effective education and communication.

There are several management styles differentiated on the basis of how much voice each

managerial level has in a decision. Three were mentioned in the discussion:

"* Command or control ("the top level says it, it happens")

"* Participatory

"* Empowerment.

It was proposed that the Japanese generally follow the first style. This style can facilitate

innovation sponsored by top management. An anecdote was mentioned to illustrate this situation. A

research institution related to the Japanese Government indicated that well-defined innovative solutions

can be provided by its suppliers within 2 weeks.

A participant responded that the comparison with Europe and Japan may be unfair. There are

substantial national, geographical. density, and cultural differences. Actually, the diversity of the United

States can be an obstacle to the dissemination of innovations. What works in one area is not necessarily

guaranteed to work in other places within the country.

Another barrier to innovation discussed by the group was labeled the "slide-rule syndrome." It

consists of the possible resistance of established sectors against an innovation that may make them

obsolete. An example was mentioned of an innovative approach to risk distribution in construction

projects. This was successfully opposed by a professional group representing the interests of those that

could be affected by this idea.

The group next discussed privatization. Tollways are common in the European highway system.

They have also been used successfully in the United States (it was argued that they are better maintained

236
than freeways because of the continuous cashflow). Some sectors of this nation's infrastructure are

privately owned and operated (telephone system, many power supply companies, etc.). It was pointed out

that the telephone system is highly innovative. It was also noted that after a recent natural disaster the

privately owned sector of the infrastructure was repaired and operational within 2 weeks; its publicly

owned counterpart took months to be back to normal operation. It was argued during the meeting that

this difference was due to an enhanced ability of the private infrastructure sector to spread the risk (when

repairs were needed, private manpower and equipment were sent from neighboring states to help).

Another topic of discussion related to privately owned and operated infrastructure was the comparison of

local power supply entities publicly and privately owned. It was mentioned that the publicly owned

entities deliver cheaper power. One possible explanation is profit. However, the question of whether this

is only due to profit was posed.

The group came back to the issue of promoting innovation. The need for demonstration projects

was discussed. The group recommended the creation of mechanisms to test and demonstrate innovative

ideas in real projects. These mechanisms should primarily address the minimization of risk for the

innovators. The Federal Government should play a key role in developing these demonstration projects.

Another vital role for the Federal Government is to continue the promotion of research in areas

rehaed to the infrastructure. It was argued that research cannot happen without Federal help because the

market is too fragmented. The discussion moved to the issue of patented products and government

regulations. Them is a disincentive to use products patented by the Federal Government Agencies are

encouraged to ideWntify nonpatented alternatives whenever possible. It was also mentioned that a 1986 act

limited the use of imnovative funding alternatives (it limited the way debt can be used to fund

infrastructure projects).

Also, the issue of marketing the infrastructure was revisited. It was agreed that the infrastructure

is not a "sexy" issue. However, to create a clear public vision of infrastructure needs and relevance for

sustained economic development, it is necessary to develop an improved public relations (PR) approach.

Education should be an essential part of this effort, as well as identifying the key constituency market.

A brief discussion followed related to the issue of enhanced PR. A parallel was made with fire

departments, which are so successful in securing funding. It was concluded that their success, although

affected by visibility, is likely to be based on liability and insurance problems caused by deficient fire

safety.

The discussion moved next to answer the question: "Why do people innovate?" Innovation

incentives mentioned were:

"* Quality of service

"* Professional and community pride

"* Financial reward

"* Response to changing environment (new regulations, for instance).

The space program was given as an example of a government operated and funded enterprise that

was extremely successful in developing and applying innovations in diverse fields (technical. managerial,

financial, etc.). It was argued that the strongest incentive was the pride of the nation, of being second to

none.

Another avenue to innovate discussed was the "just do it" attitude. This can be especially useful

when there are regulatory constraints that oppose innovation. The "just do it" attitude may be used to

237
challenge these constraints for justifiable situations. Such a process of appealing regulatory barriers can

be institutionalized to facilitate the incorporation of innovations that do not fit the regulatory mold.

At this point the discussion moved to the identification of supply and demand in the public works

infrastructure. Participants attempted to relate the different barriers to innovation with either the supply

or the demand. The same approach was used to relate the recommendations to overcome the identified

barriers. It soon became evident that several players may be part of both the demand and the supply side

of the public works infrastructure. It was decided instead to use the model proposed by Mr. Magnell (see

Figure 1) and acknowledge that innovation can be applied anywhere in this model. It was also

acknowledged by the group that innovation may take many forms (i.e., financial, managerial, social,

technological).

Mr. Magnell also proposed an eyecatching expression that conveys the importance of innovation

for the public works infrastructure:

PWI=fvi 2MRdt

where: PWI = public works infrastructure

V = vision

i = innovation

M = marketing

R = resources

t = time.

The discussion further identified barriers and corresponding recommendations. This part of the

discussion focused on summarizing the issues identified by the group for presentation at the plenary

session.

Barriers to innovation identified by group

" Fear of failure (disincentive):

- potential litigation

- loss of expected service

- cost of replacement

- publicity

- accountability

"* Absence of motivation (lack of incentive)

"* Regulatory constraints

* Fiscal constraints

"• Geographical constraints (local vs. national)

"• Fragmentation of governmental responsibility

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Lack of vision (mindset)

Political component of decisions.

Recommendations to overcome barriers

"* Promotion of incentives to counteract risk aversion (i.e., economical incentives, risk reduction

via demonstration projects, make whole if failure)

"* Legitimization via peer review

"* Communication and technology transfer

"* Professional or organizational pride as an incentive

"* Publication of successes

"* Multigovernment cooperation.

239
Group C: Enhancing Technology Transfer

Participants

Mr. Kyle Schilling, Water Resources Institute (Chair)

Mr. James Thompson. Water Resources Institute

Dr. James Broaddus, Construction Industry Institute

Professor Neil Hawkins, University of Illinois, Dept. of Civil Engineering

Mr. William Michalerya, Lehigh University, ATLSS

Professor Jesus De la Garza, University of West Virginia, Dept. of Civil Engineering

Mr. Thomas Napier, USACERL (Recorder)

Introduction

Mr. Schilling opened discussions by soliciting each members' viewpoint on technolagy transfer.

He offered a case that innovation is not equivalent to technology transfer. Innovation can "merge from

R&D, incremental improvement on existing technology, evolution of "best practice," or similar sources.

These still need to be transferred into more widespread use. Summaries of the members' opinions follow.

Innovation may take place without technology transfer, although implementation is unlikely.

A technology transfer infrastructure must be in place to diffuse an innovation throughout an

organization. Conversely, a technology transfer mechanism without innovation is meaningless.

Technology transfer needs the input of the innovators.

There are two levels of technology transfer the big-picture and detailed methods of

implementation. Perhaps the most useful product of this workshop is a description of more

specific mechanisms that can be implemented.

Clarification of the term "innovation" is necessary. Innovation is not always a great leap

forward, but is more frequently incremental advances. The technology transfer process itself

is part of the innovation process. Perhaps emphasis should be given to "transferring advances

in technology into practice." The role of codes and standards in public works relative to

technology transfer needs to be examined.

A list of issues, problems, and priorities would be useful. Operational mechanisms, such as

codes, procurement practices, and risk allocation practices, can be targeted for change.

The scope of technology transfer should be clarified. Consideration should be given to

marketing principles, such as market push, consumer pull, authorization for an item's

implementation or practice, and the consumer's ability to be comfortable or have confidence

in an item. The process, phases, and participants involved in technology transfer should be

identified. Then specific mechanics can be developed.

Discussions should also include implementation of technology into the private sector. This

process may be largely similar to public sector practices on which a more universal process

can be built.

240
Two ingredients are necessary for technology transfer. An "energy force" is necessary to

promote the technology, and the technology must be demonstrated and validated. An impartial

check in the system is necessary to minimize risk to the end user.

Mr. Shilling summarized these opening discussions by recognizing that there are larger institutional

barriers affecting innovation and technology transfer, such as government setting, codes and standards, and

litigation practices. Innovation through technology transfer (i.e., innovation through scientific, academic,

or laboratory resources) is a relatively marginal portion of the larger issue; necessary but not sufficient

to deal with the whole innovation issue.

Within the context of developing a Federal strategy, it is appropriate to promote the Government

as a more reliable partner in transferring technologies into practice. Consider the "best practice" analogy

from the legal system. The implied full weight of the Federal Government behind a process in court, in

the absence of a code or standard, implies "best practice." The transfer of technologies in implied "best

practice" is an improvement on the situation of making the Federal Government, academic community,

and others more reliable partners.

Discussions

It was recognized that the Federal Government should take a leadership role. The notion of a

"National Public Works Academy" was raised as a possible higher level of support. There are pockets

of national leadership and viable mechanisms to implement technologies (within the National Science

Foundation, for example), but there is no national cohesiveness or cooperative interaction; no reliable

partner role.

Discussions continued around the role of the Federal Government as a more reliable partner. A

"national catalyst" is needed to provide cohesiveness. Existing technology transfer systems do work in

some places and should be used to the greatest extent possible. Additional mechanisms may be identified

to fill gaps. Any national body must not be a bureaucracy, but must rely on existing systems to the

maximum extent possible. Finally, it was emphasized that a national catalyst should focus on empowering

others and not assume a directive posture.

Conclusions and recommendations

Group C concluded their discussions by posing the question: "How can the Fed!eral Government

be a more dependable partner?" The following recommendations address this question.

A "national catalyst" for infrastructure technology transfer (or implementation, or adoption) should

be established. The title "National Public Works Academy" was suggested. The "national catalyst"

terminology seemed to be favored because it implied more of a capability and less of a standing body of

any specific organization or structure.

A national catalyst can work within existing systems and mechanisms. However, it is recognized

that existing systems are necessary, but not sufficient. There are gaps that must be identified and filled.

The national catalyst must work toward the larger goal of improving the national institutional

structure.

241
A national catalyst must not be a bureaucracy, but must rely on existing systems to the greatest

extent possible. It must also be emphasized that a national catalyst should focus on empowering others,

and not assume a directive posture.

A national catalyst should assume a leadership role through the following activities and

responsibilities.

Facilitate partnering - act as a "matchmaker" with Federal, academia, industry, and other reievant

entities.

Be an honest broker for infrastructure-related action; be instrumental in identifying needs and

priorities, broker opportunities and actions, and assign leadership roles.

Lead by example in validating and demonstrating technologies through Federal agencies. Facilitate

"learning-by-doing" by Federal agencies. Disseminate both successful and unsuccessful experiences.

Facilitate technology transfer by disseminating information and establishing training requirements

and services. Identify resource allocation, planning, and action strategies.

Diversify resources in the Federal Government's technology transfer processes and activities.

Expand the Army Corps of Engineers' Construction Productivity Advancement Research (CPAR)

program to other Federal agencies. Expand the Government's partnering and customer niches to

others who are not currently involved in technology transfer. New partnering approaches may

include industry and regulatory participation, as well as other forms of academic participation.

242
APPENDICES

243
APPENDIX A

WORKSHOP AGENDA

Tuesday March 3. 1992

Welcoming Remarks: Dr. Louis R. Shaffer

SESSION A: OPPORTUNITIES FOR INNOVATION

"Performance Challenges to Infrastructure Design: Enhancing the Role of Innovation in

Public Works"

Prof. John P. Eberhard, Carnegie Mellon University

"Searching for the Infrastructure of Tomorrow: National Research Council Activities, Federal

Interests and Federal Roles"

Dr. Andrew. C. Lemer, Building Research Board

"How Effective is our Investment in Roads, Streets, and Highways ?"

Prof. Thomas D. White, Purdue University

"An Example of Successful Innovation: Three-Dimensional Graphics on Construction

Projects"

Mr. Ronald Zabilski, Stone & Webster Engineering Corporation

"Issues in Technology Transfer: Sharing Experience Between Manufacturing and

Construction"

Prof. Stephen Lu and Prof. Arthur Baskin,

Dept. of Mechanical Engineering, University of Illinois

"Advancing Innovation in Transportation Through Research"

Prof. Michael Walton, Transportation Research Board (TRB)

"Technological Advances and Public Works: A Synergistic or Antagonistic Relationship"

Prof. Neil Hawkins, Dept. of Civil Engineering, University of Illinois

Summary of Session A and Group Discussion Agenda

Prof. Joe Murtha, Dept of Civil Engineering, University of Illinois

245
SESSION B: BARRIERS TO INNOVATION

"Barriers to Adoption of New Technologies"

Prof. Peter Nowak, Dept of Rural Sociology, University of Wisconsin"

"How Demonstration Programs Improve Potential for Utilization"

Mr. Richard A. Sullivan, American Public Works Association (APWA)

"Identifying Programming, Executing Infrastructure Research and Development"

Mr. Carl Magnell, Civil Engineering Research Foundation (CERF)

"Drinking Water Infrastructure Research"

Mr. Joel Catlin, American Water Works Association*

"Infrastructure Finance: The State and Local Perspective"

Mr. Benjamin Mays, Government Finance Officers Association

"Legal Problems with Innovation in Public Works"

Mr. Charles Seemann, Partner, Deutsch, Kerrigan & Stiles

Summary of Session B & Group Discussion Agenda

Mr. Jesse Story, Federal Highway Administration

SESSION C: ENHANCING TECHNOLOGY TRANSFER

"Innovation and Technology Transfer Opportunities: Industry/University/Government

Partnerships"

Mr. William D. Michalerya, Center for Advanced Technology for Large Structural

Systems, Lehigh University

"Technology Transfer as a Work-Practice Change Process"

Prof. J.M. De La Garza, Civil Engineering Dept., Virginia Polytechnic Institute

and State University

"Financing Capital Improvements Through Technology Transfer: Public-Private Collaboration

in Research Commercialization"

Mr. Michael B. Goldstein, Partner, Dow, Lohnes & Albertson**

Wednesday March 4, 1992

"Implementation of Innovation through Total Quality Management"

Dr. James A. Broaddus, Construction Industry Institute (CII)

"A Marketing Approach to Technology Transfer"

Mr. Jeff Walaszek, U.S. Army Construction Engineering Research Laboratories

246
Summary of Session C & Group Discussion Agenda

Mr. Kyle Shilling, U.S. Army Institute of Water Resources

Group Discussion

Group A: Potential Areas of Opportunity

Group B: Barriers to Innovation

Group C: Enhancing Technology Transfer

* Paper unavailable at time of publication

** Paper submitted without presentation

247
APPENDIX B

ANALYSIS OF WORKSHOP PRESENTATIONS

The following paragraphs summarize the contributions of the workshop participants. The summaries

are organized to reflect the major issues relevant to the seven categories of barriers and opportunities

discussed in Volume 1, Chapter 2.

Cultural Values and Social Perception of Innovation and Infrastructure

"Technological Advances and Public Works: A Synergistic or Antagonistic Relationship," by N. Hawkins

Hawkins looks at the cultural, educational, and social foundations as factors that can be used to

promote or interfere with innovation. In his paper he parallels U.S. and Japanese innovative programs as

a mechanism to determine the mentioned factors. He mentions the fragmentation of the U.S. construction

industry as an obstacle for innovation. He describes the leadership role exerted by the Japanese

Government through the Ministry of Construction, as well as the tight partnership between Government,

academia, and industry to develop and implement innovations in practice.

"Barriers to Adoption of New Technologies," by P. Nowak

Nowak focuses on understanding the reasons that affect an individual's decision to adopt or reject

an innovation. An individual can reject an innovation if he is unable or unwilling to adopt. Nowak

indicates some causes of the inability to innovate are: lack of information, cost of information, complexity

of innovation, limited support available, and inadequate managerial skill. An individual may be unwilling

to adopt for reasons such as conflicting information, poor applicability, incompatibility, or risk.

Governmental Structure and Regulations

"Searching for the Infrastructure of Tomorrow: National Research Council Activities, Federal Interests,

and Federal Roles," by A. Lemer

As the Director of the Building Research Board (BRB), Lemer describes BRB's active participation

in the search for solutions to the infrastructure problem. Many of the facilities that are part of the public

works infrastructure have a long life and are difficult to remove or retire. Also, in comparison with other

sectors, the public works infrastructure has had few innovations in the last century (i.e., sewer systems,

roads, and rails). He also mentions local distrust of the Government, which discourages investment and

innovation.

A lot of potential exists for successful innovations which improve the condition and capacity of

existing facilities. Also, it is important to address cross-cutting research. The BRB is pursuing efforts

to: encourage research, motivate changes in policy, and have better coordination of national and local

efforts both private and public. There is also an ongoing effort to develop improved measurements of

infrastructure performance.

"Identifying, Programming, Executing Infrastructure Research and Development," by C.O. Magnell

Magnell is the Director of Research for the Civil Engineering Research Foundation (CERF). He

provides a very broad description of infrastructure as all the common structures and facilities enabling the

society to function. He indicates that there is a shortage of R&D activities focused on the public works

249
infrastructure. He also asserts that the major problem affecting the nation's infrastructure is the lack of

vision of a desired end state for the public works infrastructure.

Magnell cautions about research activities that are an end in themselves. This approach cannot

provide the badly needed solutions to infrastructure problems. He emphasizes the need for an adequate

technology transfer process that, through user involvement, allows the generation of R&D products that

are applicable and useful in field practice.

"How Demonstration Programs Improve Potential for Utilization," by R.H. Sullivan

Sullivan describes findings of the American Public Works Association (APWA), of which he is the

Executive Director, on acceptance of innovations by public works organizations. The APWA found that,

in general, public works officials are conservative, avoid risks, and (except for professional pride) are not

motivated to innovate. Public works organizations are interested in demonstrations of innovative ideas,

in peer evaluations of these innovations, and want to avoid "black boxes." The APWA also found that

several factors impact the decision and ability to innovate (i.e., regulation by higher levels of government,

jurisdictional limits, codes and standards, public support, risk, and employee training).

The APWA recommends the development of innovation demonstrations that are adequately

monitored and recorded. It also recommends disseminating the findings of the demonstrations to all

potential users.

"Advancing Innovation in Transportation Through Research," by C.M. Walton

As past president of the Transportation Research Board, Walton provides insightful guidelines to

shape the transportation R&D efforts. This is especially critical now when there is growing interest and

funding to sponsor transportation research. His proposed approach is to continue and expand on the

success of the Strategic Highway Research Program (SHRP). Also, he recommends additional

involvement from the private sector. He also recommends seizing opportunities that exist for

transportation R&D. Among others, he cites: leveraging advanced technologies, multidisciplinary teaming,

public/private/academic partnering, facilitating risk taking by innovators, leadership at all levels, and

others.

"How Effective is our Investment in Roads, Streets, and Highways?" by T. White

White focuses on the transportation infrastructure, which is a major component of the nation's

infrastructure by several measures (i.e., contribution to GNP, number of jobs, etc.). However, the Federal

R&D investnent in transportation is very small (3.3 percent).

White provides several obstacles and opportunities for innovation in transportation. Among others,

he proposes an integrated approach for R&D that covers the different modes of transportation and the

establishment of long term policies for infrastructure development. He also notes a number of issues that

interfere with the ability to innovate in transportation: technical issues being affected by political agendas,

shortage of knowledgeable personnel, etc.

250
Risk and Liability

"Legal Problems with Innovation in Public Works," by CF. Seemann

Seemann starts his paper by describing the historic trend in facility construction that moved the

responsibility of construction from a single design-builder (master builder) to a team of participants

contractually related to the owner. He also mentions the increase in social value for human life. These

two factors have contributed to an added legal responsibility for contractors, designers, and owners.

Innovation in facility acquisition implies risk due to this legal responsibility and the probability of

failure. Seemann argues that in spite of the risks involved, construction contractors can still derive profit

from innovations. However, he asserts that designers are not motivated to innovate, due to lack of reward

(low fees in competitive market), desire to stay in the mainstream to avoid liability in case of failure, and

unwillingness by owners to motivate innovation.

He proposes a more active role by the Federal Government to promote innovation. This can be

accomplished through the assumption of risk by the government in innovative projects and by developing

flexible standards to accommodate design innovations.

Public and Private Partnership

"Implementation of Innovation Through Total Quality Management," by J.A. Broaddus

The ultimate goal of R&D activities is the transfer of technology. Broaddus describes the

Construction Industry Institute (CII) and its total quality management (TQM) approach to overcoming the

barriers that oppose technology transfer. TQM involves customer focus, emphasis on processes,

continuous improvement of these processes through innovation, and people involvement.

CII is another example of successful partnership between private industry and academia. It also

involves a few public entities. The emphasis is to have products delivered to the industry partners. To

accomplish this, CII has used action teams conformed by industry participants to promote implementation

of R&D products; educational programs that translate R&D results into course programs for training of

construction personnel; and a consistent approach of making implementation "company-friendly."

"Innovation and Technology Transfer Opportunities: Industry/ University/ Government Partnerships," by

W. Michalerya

Michalerya illustrates the potential for partnerships among industry, academia, and Government to

develop R&D in the public works infrastructure. The Center for Advanced Technology for Large

Structural Systems (ATLSS) at Lehigh University is supported by the National Science Foundation and

industry partners. This industry partnership is valuable not only in the funding of projects but also in

providing timely feedback from potential users of R&D products.

Funding

"Infrastructure Finance: the State and Local Perspectives," by B. Mays

Mays discusses the trend for the reduction in infrastructure spending by the Federal Government,

which places increased burden on State and especially on local governments. There are several

251
alternatives available for funding of public works projects, such as debt financing, own-source revenues,

and public-private partnerships. However, there are also barriers that interfere with local government

access to these alternatives. Mays discusses barriers like constitutional and regulatory constraints, political

pressures, etc.

Size and Type of Infrastructure Projects and Facilities

"Performance Challenges to Infrastructure Design: Enhancing the Role of Innovation in Public Works,"

by J.P. Eberhard

Eberhard claims that the present infrastructure is the result of innovations developed more than a

century ago (i.e., telephone, elevator, steel structural systems, indoor plumbing. sewers, automobile, etc.).

He asserts that infrastructure innovations can be promoted by describing the functional performance

demands for infrastructure systems. This description is void of any specific solutions: (1) a means of

movement for persons and goods, with horizontal and vertical components, (2) a means for communicating

between persons and between organizations, (3) a "metabolic" process providing energy, materials, and

disposal of waste,-., and (4) a shelter for protection and for providing space.

Education, Research, and Technology Transfer

"Issues in Technology Transfer: Sharing Experience Between Manufacturing and Construction," by A.

Baskin and S. Lu

Baskin and Lu share their experience in technology transfer for manufacturing support, applicable

to construction of infrastructure facilities. They see as obstacles to innovation the fragmentation of the

design-construct process, the presence of risk, and the lack of reward for innovators. One of the

recommendations is to develop a more integrated approach for facility design and construction that

eliminates the antagonistic relationship motivated by the present fragmented approach. They also indicate

the potential value of innovative information systems to help in this integration, but caution about

information systems that are incompatible with the user's way of doing things. They describe in detail

their work in concurrent engineering to support integration of the design-manufacturing process.

"Technology Transfer as a Work-Practice Change Process," by J.M. De La Garza

De la Garza examines technology transfer as the procedure through which an organization adopts

and implements innovations. Technology transfer implies change, and opposition to change is always to

be expected (fear of change, reduced job performance during implementation, etc.). To promote the

transfer and adoption of innovations within an organization, De La Garza recommends, based on his

analysis and on his survey of relevant work by others: top management commitment; active change

agents; active technology gatekeepers; and a technology transfer task force within the organization. De

La Garza illustrates some of the key points with the transfer of computer-aided design and drafting

(CADD) technology into the construction industry.

"Financing Capital Improvements Through Technology Transfer Public-Private Collaboration in Research

Commercialization," by M.B. Goldstein

Goldstein proposes strategies to perform technology transfer so research institutions can reduce their

risks. He also proposes using the value of knowledge (in the form of innovations) as a possible source

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of revenue to help finance the solution of infrastructure needs. His premise is that through commercialization of innovations revenue can be raised by research institutions.

Goldstein lists three main alternatives for technology transfer of innovations into the marketplace:

commercialization entities, start-up companies, and joint ventures (research institution/private company).

He discusses the issue of risk associated with technology transfer. Risk originates by the possibility of

occurrence of three major scenarios: economic loss, breach of contract, or harm by a defective innovative

product. Goldstein suggests several avenues to control the risk associated with technology transfer based

on risk analysis and minimization.

"Technology Transfer and Marketing: Army-Style," by J. Walaszek

Walaszek reviews some of the barriers to the adoption of innovations, categorized in three major

classes: ineffective communications, human resistance to change, and organizational and industry

constraints. He describes the solution to these barriers within the Army R&D and user community. The

solution consists of a technology transfer process as described in Volume 1, Chapter 3. He emphasizes

the importance of gathering user input and having user involvement throughout the different phases of the

technology transfer process. This guarantees that the R&D products conveniently address the user needs,

and that they fit within the operational constraints of the user's environment.

"An Example of Successful Innovation: Three-Dimensional Graphics on Construction Projects," by R.

Zabilski

Zabilski describes the successful transfer and implementation of innovative computer-based graphical

techniques for the planning and management of construction projects. The mentioned innovation allows

engineers to visualize designed components, in place, long before actual construction. This makes for

more effective planning and cost estimating of the facilities. The described tools also allow for improved

construction control and delivery of as-built information to the owner/operator of the facility. From a

general perspective, this paper restates the importance of innovative information systems as aids for the

design, construction, operation, and management of facilities.

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APPENDIX C

BIOGRAPHICAL SKETCHES

Arthur Baskin

Arthur Baskin holds a Ph.D. in Computer Science and is presently the Director of the Automation

Support Center at the University of Illinois. Dr. Baskin's research interests are in group decision support

systems, support for professional decisionmaking, and complex systems theory.

Dr. Baskin's work with decision support systems in the U.S. Army began in the early 1980s.

Working with USACERL, the group introduced one of the first local area networks in the Army at a DEH

at Fort Leonard Wood, MO. Over the past 5 years, Dr. Baskin has worked on network tools to support

group productivity at VCorps in Germany.

For the past 5 years, Dr. Baskin and Dr. Stephen Lu have been collaborating on the design and

implementation of computer software to support concurrent engineering. They have organized two

international workshops on Cooperative Problem Solving for Engineering Problem Solving.

James A. Broaddus

James Broaddus joined the Construction Industry Institute (CII) in 1990 as Associate Director for

implementation programs. He holds B.S., M.S., and Ph.D. degrees in civil engineering from the

University of Texas at Austin.

Before coming to CII, he served 20 years in the U.S. Navy Civil Engineer Corps, where he managed

all aspects of major projects. His service included several assignments in the Seabees (the Navy's military

construction forces) as well as field and engineering responsibilities on a wide variety of major contract

design and construction work. Key positions included: (1) responsibility for the $500 million/year

engineering and construction program in the Navy's 11 state southern region, (2) major project planning

and budgeting for the Chief of Naval Operations in the Pentagon, and (3) a unique assignment as

Commanding Officer of the Presidential Retreat at Camp David, MD, during President Reagan's second

term.

Major construction projects for which Dr. Broaddus was responsible as a field construction manager

included a major pier complex, industrial waterfront utilities upgrade, and a major medical clinic and

training facility. In the Seabees, he directed a 700-person construction work force overseas in the Pacific

and Europe in accomplishing a wide variety of projects. In the Navy's Southern Division, his most

notable projects were the $500 million construction of three new homeports on the Gulf Coast, $200

million of fast-track restoration work in South Carolina in 1989 after Hurricane Hugo, and implementation

of CII constructability and incentive contracting.

Dr. Broaddus' research includes the effect of planning inputs to the design process on ultimate

project success. He is a senior lecturer in Construction Engineering and Project Management at the

University of Texas at Austin and a member of the team charged with implementation of total quality

management throughout the University. He is a member of the American Society of Civil Engineers,

National Society of Professional Engineers, and the Society of American Military Engineers. He is a

registered Professional Engineer in Texas and has consulted in the area of project management innovation

and improvement.

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Joel Catlin

Project manager for the AWWA Research Foundation involved in contracting and managing research

projects for the drinking water industry, Joel Catlin has more than 12 years experience in engineering

management, design, and analysis of water and wastewater activities for private consulting firms. He

received a Bachelor of Science in Civil Engineering from Colorado State University in 1976, and is

currently enrolled in graduate studies in Civil Engineering - Water Quality, at the University of Colorado,

Denver. Mr. Catlin was appointed to the Standards Committee on Polyolefin Pressure Pipe and Fittings

and is a member of the "Low Cost Small Systems Treatment Technology Committee," established by the

USEPA to develop low-cost, small system treatment technology. Member of AWWA, WPCF, and a

Registered Professional Engineer.

Jesus M. De La Garza

Dr. Jesus De La Garza received his Bachelor of Science degree in Civil Engineering in 1978 from

the Monterrey Institute of Technology in Mexico. Upon graduation, he acquired 31 years of progressively

responsible industrial experience. Dr. De La Garza attended the University of Illinois at UrbanaChampaign from 1982 to 1988 where he received his Master of Science and Doctor of Philosophy degrees

in Civil Engineering in 1984 and 1988, respectively. In August 1988, Professor De La Garza joined the

faculty of the Civil Engineering Department at Virginia Tech.

Dr. De La Garza has received funding from the National Science Foundation's prestigious Research

Initiation Award. This project encompasses two research studies, namely: (1) a technology transfer

investigation to expedite the adoption of expert systems in the AEC industry and (2) a design-construction

integration investigation to enhance the estimating process through the articulation of design intent.

Professor De La Garza's scholarly achievements have been disseminated in 11 journal articles, 19

conference proceedings, three book chapters and four technical reports.

Dr. De La Garza is an active member of the ASCE Expert Systems Committee, the ASCE Project

Controls Committee, and the ASCE Construction Research Council.

John Paul Eberhard

John Eberhard is Professor of Architecture, Head of the Department of Architecture, and Chairman

of the Architectural Faculty at Carnegie-Mellon University. He has taught Urban Infrastructure, Research

Management, and Design Management. He received his Bachelor of Science from the University of

Illinois, School of Architecture, Architectural Design (1952). He also attended Massachusetts Institute of

Technology, School of Industrial Management for his Master of Science in Industrial Management (1959).

His teaching experiences are at the State University of New York at Buffalo, School of

Massachusetts and Environmental Design, as Dean, 1968-1973, and Massachusetts Institute of Technology,

School of Industrial Management as Visiting Lecturer, 1959-1963. Professor Eberhard has professional

experience as Executive Director, Building Research Board, National Academy of Science-National

Research Council, Washington, DC, 1981-1988; President of AIA Research Corporation, Washington, DC,

1973-1978; Dean of the School of Architectural and Environmental Design, State University of New York

at Buffalo, 1968-1973; Director of the Institute for Applied Technology, National Bureau of Standards,

1966-1968; Visiting Lecturer, School of Industrial Management, Consultant, Sheraton Corporation of

America, Director of Research, 1959-1963; and President (and one of the incorporators), Creative

Buildings, Inc., 1951-1958.

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Publications include: "The Management of Design in an Industrialized Building Industry," master's

thesis, Massachusetts Institute of Technology (June 1959), "Horizons for the Performance Concept in

Building," Proceedings of the First Conference on Performance Concept, Chicago, IL (October 1965);

"Technology for the City," International Science and Technology, No. 57 (September 1966); "Management

of Design," AIA Journal (October 1968), pp 80-81; "The City as a System," in Beyond Left and Right,

Radical Thoughts for Our Times, edited by Richard Kostelanetz (William Morrow & Co., Inc., New York,

1968), pp 161-166; with Abram Bernstein, "A Conceptual Framework for Thinking About Urban

Infrastructure," Built Environment, Vol 10, No. 4 (Oxford, England, 1984); "Technology and the Future

City," published in the transactions of Lambda Alpha's International Biennniel Congress of October 1985;

"Building the City of Tomorrow," published in the Outlook section of the Washington Post, June 22,

1988.

Mr. Eberhard is a Fellow, The American Institute of Architects and a Member, The Cosmos Club,

Washington, DC. He has received the Alfred P. Sloan Fellowship, Massachusetts Institute of Technology,

1959 and Engineering News Record Citation as Construction Industry Who's Who in America.

Mr. Eberhard managed more than 400 projects for MIT, Sheraton Hotel Corporation, The Institute

for Applied Technology, State University of New York at Buffalo, AIA Research Corporation, and the

Building Research Board.

Mr. Eberhard has served on editorial advisory committees of more than one dozen journals, 1966-

1988, as Chairman, Montgomery County, MD, Waste-Water Treatment Study, 1984, and as ViceChairman, Research Foundation, American Consulting consultant to AIA Vision 2000 Program.

Michael B. Goldstein

Michael Goldstein is a partner with the Washington, DC law firm of Dow, Lohnes and Albertson

where he is in charge of the firm's higher education, nonprofit organizations, and government grants and

contracts practice. He serves as general counsel to a number of national higher education associations,

including the American Association of Community and Junior Colleges, the American Association of State

Colleges and Universities, the State Higher Education Executive Officers Association, and the Association

of Urban Universities.

Mr. Goldstein was formerly Associate Vice-Chancellor for Urban and Governmental Affairs and

Associate Professor of Urban Sciences at the University of Illinois at Chicago, where he taught graduate

courses in urban policy. Before that he served as Assistant City Administrator and Director of University

Relations in the Office of the Mayor of the City of New York.

He was the first Executive Director of the New York City Urban Corps and directed the Urban

Corps National Development Office, a project sponsored by the Ford Foundation to encourage the

establishment of student intern programs in the nation's cities. While in New York, he was an Adjunct

Assistant Professor of Government in the graduate public administration program at John Jay College of

Criminal Justice of the City University of New York, where he taught administrative law and public policy

courses.

Mr. Goldstein is Vice-Chairman of the Education Law Committee of the Federal Bar Association

and Chairman of the Education Law Committee of the Federal Administrative Law Section of the

American Bar Association. He was a member of the Board of Advisors of the Forum for College

Financing Alternatives of the National Center for Postsecondary Governance and Finance and a Fellow

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of the Columbia University Seminar on the University and the City, and is presently a Fellow of the

Stanford Forum for Higher Education Futures.

Mr. Goldstein served as board Chairman of the Chicago Urban Corps and President of the National

Center for Public Service Internship Programs, and was Instrumental in the formation of the National

Society for Internships and Experiential Education, which arose from the merger of the National Center

with the Society for Field Experience Education. He served as chairman of the Task Force on Public

Policy of the Commission on the Higher Education and the Adult Learner of the American Council on

Education and was the author of the Commission study on Federal policy impediments to adult learning.

Mr. Goldstein was counsel to the Legal Issues Task Force of the joint SHEEO-COPA Project on the

Assessment of Long Distance Learning via Telecommunications and presently serves on a multi-state task

force assembled by the New York State Education Department to develop new strategies for the

authorization of telecommunicated distance learning.

Mr. Goldstein serves on the executive committees of the boards of directors of the Greater

Washington Research Center, the Washington Ballet, and the Washington Center for Internships and

Academic Seminar. He also serves as a Trustee of Mount Vernon College and of the Fielding Institute,

where he is chairman of the Budget and Finance Committee. He is Co-Vice President for Special Grants

of the John Eaton Elementary School Home and School Association.

Mr. Goldstein has written extensively on nontraditional higher education, nonprofit organizations,

policy issues involving telecommunications and higher education, technology transfer and higher education

finance, including articles on debt financing, use of ancillary entitlements and state policy impediments

to facilities financing. He also holds a law degree from New York University, a Bachelor of Arts in

Government from Cornell University, and was a Loeb Fellow in Advanced Urban and Environmental

Studies at Harvard University. While at Cornell, he was a Newspaper Fund Fellow and an intern with

United Press International in New York City, where he later worked as a reporter.

Neil Hawkins

Neil Hawkins has been Head, Department of Civil Engineering, University of Illinois at UrbanaChampaign since March 1991. He assumed that position after 23 years on the faculty of the University

of Washington in Seattle where he was Chairman of Civil Engineering from 1978 through 1987 and

Associate Dean for Research, Facilities and External Affairs from 1987 through 1991. His primary

research interests are in earthquake engineering and in the application of fracture mechanics concepts to

predictions of the behavior of concrete materials.

Dr. Hawkins is a Fellow of the American Concrete Institute and served on its Board of Directors

from 1982 through 1985. He is a member of the American Society of Civil Engineers and the Earthquake

Engineering Research Institute and served on its Board of Directors from 1985 through 1987. He is a

member of the Technical Advisory Board of the Post-Tensioning Institute and was their representative for

the 1985 and 1988 reviews of the NEHRP Recommended Provisions for the Development of Seismic

Regulations for New Buildings. In 1988 he was a UNESCO Visiting Scientist at the International Institute

of Seismicity and Earthquake Engineering of Japan's Building Research Institute. Currently he is a

member of the Executive Committee for the NSF's project on Precast Concrete Seismic Structural

Systems.

Dr. Hawkins has been interested in concrete construction since his student days. His BSCE thesis

at the University of Sydney in Australia in 1957 was on anchorage zone stresses in post-tensioned beams

and his Ph.D thesis from the University of Illinois in 1961 was on two-span continuous prestressed

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concrete beams. From the American Concrete Institute he received the Watson Medal in 1969, the Reese

Award in 1976 and 1978, and the Structural Research Award in 1991. From the American Society of

Civil Engineers he received the State-of-the-Art Award in 1974, the Reese Award in 1976, and the Lin

Award in 1988. He is the author of over 180 publications and reports on structural engineering and in

1991 was a member of the blue-ribbon panel created by the Governor of Washington State to investigate

the sinking of the 1-90 Murrow Bridge during rehabilitation.

Andrew C. Lemer

Andrew Lemer received his B.S., M.S, and Ph.D. degrees in civil engineering from the

Massachusetts Institute of Technology. An engineer-economist and planner, he was formerly Division

Vice President with PRC Engineering, Inc. He is a member of the American Institute of Certified

Planners, the American Society of Civil Engineers, the Urban Land Institute, and the American MacroEngineering Society.

Stephen C-Y. Lu

Stephen Lu received his M.S. and Ph.D degrees from the Department of Mechanical Engineering

and the Robotics Institute of Carnegie-Mellon University, Pittsburgh, PA. He is currently a tenured

Associate Professor and the founding Director of the Knowledge-Based Engineering Systems Research

Laboratory in the Mechanical and Industrial Engineering Department at the University of Illinois at

Urbana-Champaign (UIUC). He is also a Research Associate Professor of the Computer Science

Department and the Beckman Institute for Advanced Science and Technology at UIUC. His research

interests are in the development of artificial-intelligence-based techniques for advanced engineering

automation, and in the integration of these techniques with traditional engineering methods.

Currently, he is developing knowledge processing technology to support various concurrent

engineering and system management tasks. He has published over 100 technical papers, reports, and book

chapters in this area, and served as a keynote speaker for several national and international conferences.

Dr. Lu is an associate editor of the Journal of Engineering for Industry, ASME Transactions, and the

International Journal of Computer-Integrated Manufacturing Systems. He also serves on several editorial

committees including ASME Transactions, Journal of Intelligent Manufacturing, and the International

Journal of System Automation. He has organized many technical conferences and workshops, and was

the Chairperson of the 1986 ASME Symposium on Knowledge-Based Expert Systems for Manufacturing

and the 1989 ASME Symposium on Concurrent Product and Process Design.

He is an active member of American Society of Military Engineers (ASME), SME, IEEE, and

AAAI, and is a corresponding member of the International Institute for Production Research (CIRP). He

has served as a technical consultant and expert panelist to various industries and Federal agencies. He

received the Presidential Young Investigator (PYI) Award from the National Science Foundation in 1987,

the Outstanding Young Manufacturing Engineer Award from the Society of Manufacturing Engineers in

1988, and was selected as an Outstanding Young Man of America in 1988. In 1990, he received the

Xerox Senior Faculty Research Award from UIUC for his high quality research accomplishments over the

previous 5 years. In the same year, he was also appointed as a University Scholar for his excellent

contributions to scholarly activities.

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Carl 0. Magnel

Mr. Magnell is the Director of Research for the Civil Engineering Research Foundation (CERF).

He joined CERF after 27 years as an Army officer. His last military assignment was as Director of the

Department of Defense Panama Canal Treaty Implementation Plan Agency (TIPA). Before that, he served

as the Director of the Army's Construction Engineering Research Laboratory (USACERL) in Champaign,

IL. While at USACERL, he oversaw a research program totalling approximately $60 million annually.

The scope was international, with work and research in the United States, Europe, Asia, and Central

America, and a diverse program encompassed, among other things, a large and diverse environmental

effort, engineering materials, energy, and facility systems management. He also has served as the

Engineer for U. S. Forces in Korea and commanded the 18th Engineer Brigade in Germany.

Mr. Magnell's diverse assignments while in the U.S. Army Corps of Engineers include 12 years

leading engineer organizations of as many as 6000 personnel. He has hands-on experience in master

planning, programming, budgeting, construction, negotiations, contracts, and construction/environmental

R&D. His experience also includes directing executive level professional staffs of 10 to more than 100

personnel, including planners, human resource managers, design/construction engineers, and research

scientists.

Mr. Magnell has 8 years experience interacting and negotiating with members of Congress and their

staffs, senior officials in the U.S. Departments of Defense and State, and senior government officials in

Germany and Korea.

Mr. Magnell received a Masters in Science in both Civil Engineering and Political Science from the

Massachusetts Institute of Technology and a Bachelor of Science from the U.S. Military Academy at West

Point. He is also a graduate of the Army War College and the Executive Development Program of the

University of Maryland.

Benjamin W. Mays

Benjamin Mays directs the financial advisory activities of the Government Finance Research Center

(GFRC). He was part of the research team that provided bond registration cost-related data for the

Supreme Court case of South Carolina v. Baker. Mr. Mays' publication credits include an extensive

analysis of reciprocal immunity between the Federal Government and the States. The analysis was

included in an article entitled "Arguments on Bond Registration: On the Way to the Supreme Court."

Mr. Mays has also been active in most of GFRC's financial advisory projects, including water and

sewer system improvements, toll roads, jails, administrative and judicial centers, parking lots, reservoirs,

libraries, landfills, bridges, streets and sidewalks, and a variety of other governmental structures.

Mr. Mays recently completed work on the GFRC's role in the U.S. Environmental Protection

Agency's (USEPA's) efforts to apply the Clean Water Act to Boston Harbor. He has also been active in

the GFRC's other Clean Water Act compliance programs with USEPA and several State agencies. Mr.

Mays is a graduate of the College of William and Mary in Virginia.

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William D. Michalerya

William Michalerya received a Bachelor of Science in Civil Engineering from Cornell University

in 1976 and a Master of Engineering in Civil Engineering from Cornell University in 1977. He received

his Master of Business Administration from Lehigh University in 1988.

Responsibilities at Lehigh University include management of the Advanced Technology for Large

Structural Systems (ATLSS) industry program and joint research projects as well as technology transfer

activities such as short courses, seminars, demonstration projects, and development and implementation

of technology transfer plans.

In addition to the ATLSS position, Mr. Michalerya recently was appointed Vice-President and Chief

Operating Officer of Competitive Technologies, Inc. (CTI), a subsidiary of Lehigh University. CTI has

a mission of technology transfer, development of collaborative R&D programs, and patenting and licensing

of new technologies.

Before joining ATLSS, Mr. Michalerya spent 10 years in private practice as a civil engineer and

project manager. His project experience includes a wide range of structural and geotechnical work,

including bridges, buildings, industrial, and waterfront facilities. His management experience includes

supervision of technical staff, preparation of proposals, reports, and specifications, and client development

responsibilities. From 1984 to 1988 he was project manager at Bergmann Associates, Philadelphia, PA.

From 1979 to 1984 he was a civil engineer for Bethlehem Steel Corporation, Bethlehem, PA, and from

1977 to 1979 he was a geotechnical engineer for the Quality Assurance Group, D'Appolonia Consulting

Engineers, Inc., Pittsburgh, PA.

Mr. Michalerya is a member of the American Society of Civil Engineers, Chi Epsilon Honorary

Fraternity (Civil Engineering), and Beta Gama Sigma Honor Society (Business). He is a registered

professional engineer in Pennsylvania.

Fred Moavenzadeh

Dr. Fred Moavenzadeh is the George Macomber Professor of Construction Engineering and

Management and Director of the Center for Construction Research and Education at the Massachusetts

Institute of Technology. His professional field of interest is construction engineering and management,

with a primary focus on international construction, construction finance, and strategic management. Hc

has taught the basic courses in construction, facility design, and engineering and management of

infrastructures, both in the Department of Civil Engineering at MIT and at the Graduate School of Design

at Harvard University.

Joseph P. Murtha

Joseph Murtha received B.S. and M.S. degrees in civil engineering from Carnegie-Mellon University

in 1953 and 1955, respectively; and his Ph.D. in Civil Engineering from the University of Illinois at

Urbana-Champaign in 1961.

He served on the faculty in civil engineering at the University of Illinois from 1958 to 1966 as a

research associate, assistant professor, associate professor, professor, and Water Resources Center Director.

From 1966 to 1969 he served other organizations in leadership positions in harbor and ocean structures

research.

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In 1969 Dr. Murtha returned to the University of illinois as Professor of Structural and Hydraulic

Engineering. During the 1976-77 academic year he he.:" - Fulbright-Hays Senior Research Fellowship

in the United Kingdom. In 1986 he became the Director of ae Advanced Construction Technology Center

at the University of Illinois. In 1991 he served as Chairman of the National Civil Engineering Research

Needs Forum sponsored by the Civil Engineering Research Foundation. He currently serves as vicechairman of the task force overseeing implementation of the Forum recommendations.

Peter J. Nowak

Dr. Nowak received his Ph.D. from the University of Minnesota's College of Agriculture in 1977.

He served as both an assistant and associate professor of rural sociology at Iowa State University prior

to joining the faculty at the University of Wisconsin-Madison in 1985. At Madison, he holds a research

appointment as a Professor in the Department of Rural Sociology and an extension appointment as a Soil

and Water Conservation Specialist in the Environmental Resources Center.

His work has focused on the transfer of agriculture technologies to farm audiences. This has

included examining individual decision processes on whether to adopt or reject these technologies; the

socioeconomic impacts of innovative technologies; and how institutional settings influence technology

transfer processes.

Dr. Nowak has publications in professional books, journals, and periodicals resulting from research

at the local, regional, and national levels. He has also served on a number of national committees and

advisory groups including the U.S. Congress Office of Technology Assessment, the National Academy

of Science's Board on Agriculture, U.S. Army Corps of Engineers, U.S. Office of Management and

Budget, American Farmland Trust, and the Soil and Water Conservation Society.

Charles F. Seemann, Jr.

Mr. Seemann's practice relates to matters of the construction industry, surety and professional

responsibility, fidelity and financial institution bonds, and public contract law. Mr. Seemann has been the

President and Director of both the New Orleans Association of Defense Counsel and New Orleans Legal

Assistance Corporation. He joined the firm in 1965 after 3 years active duty in the U.S. Navy. In 1959,

Mr. Seemann earned a Bachelor of Science in Geology, and in 1962 an LLB, both from Tulane

University. He has lectured on construction topics at national meetings of the ASCE, ASME, the National

Institute of Municipal Law Offices, at continuing education programs of the Louisiana and Florida Bar

Associations and at Loyola University and the Deep Foundations Institute.

Kyle E. Schilling

Kyle Schilling is Director of the U.S. Army Corps of Engineers, Institute for Water Resources. He

manages a diverse and rapidly responsive program of studies and research relating to current issues in the

changing national water resources environment. His experience centers on comprehensive resources planning, water supply, and water conservation planning. He directed the staff efforts of the 1977 White

House Drought Study Group and the 1980 President's Intergovernmental Water Policy Task Force Subcommittee on Urban Water Supply. He was also the principal author of the National Water Resources

Infrastructure Needs Study completed in 1987 for the National Council on Public Works Improvement.

He recently organized and directed a North Atlantic Treaty Organization (NATO) Advanced Research

Workshop on Urban Water Infrastructure.

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Mr. Schilling graduated in 1963 as a civil engineer from the Pennsylvania State University. He

began his professional career as a summer intern with the Pennsylvania Department of Highways. This

was followed by employment with the Baltimore District of the U.S. Army Corps of Engineers where he

worked on the Potomac and Susquehanna River Basin Studies until 1966. Before assuming his present

position, he was employed from 1972 to 1976 by the North Atlantic Division of the Corps of Engineers

as the Senior Interdisciplinary Study Manager for the Northeastern United States Water Supply Study (NEWS) and as Regional Study Director for the 1975 National Assessment conducted by the Water

Resources Council. He worked for the Bureau of Reclamation in 1971 and 1972 as plan formulation and

study management specialist on the Western U.S. Water Plan. From 1969 to 1971 he served as plan

formulation specialist for the North Atlantic Regional Study (NAR) conducted by the North Atlantic

Division of the Corps of Engineers. He was also employed by the State of Nebraska from 1966 to 1969

as head of Nebraska's Public Law 566 (small watershed) planning program and as a state work group

representative on the Missouri Basin Interagency Committee. He has been employed at IWR since 1976,

serving as Chief of the Policy Studies Division prior to selection to the position of Director in 1990.

Louis R. Shaffer

Dr. Shaffer graduated from the Carnegie-Mellon University School of Engineering in 1950 and

graduated from the University of Illinois at Urbana-Champaign in 1957 with a Master of Science degree.

He received his Ph.D. from UIUC in 1961.

Since 1969, Dr. Shaffer has been the Technical Director of the U.S. Army Construction Engineering

Research Laboratories (USACERL) in Champaign, IL, one of the largest organizations dedicated to infrastructure research and technology transfer in the United States. He has been a member of the faculty of

the University of Illinois at Urbana-Champaign since 1954 and was Professor and Head of the

Construction Engineering Group in the University Department of Civil Engineering from 1961 to 1969.

Under his technical direction, USACERL has leveraged Army R&D resources by developing successful

partnerships with UIUC and many other universities.

Dr. Shaffer has published two bobks and numerous articles on systems design procedures based on

modem mathematical and scientific methods for use in decisionmaking in the planning, designing, bidding,

scheduling, and monitoring ,of construction operations. He is a registered professional engineer in

Pennsylvania and a Fellow of ASCE.

Dr. Shaffer has received numerous awards, including the prestigious Puerifoy Construction Research

Award of the American Society of Civil Engineers (ASCE), an Exceptional Civil Servant from the U.S.

Army, the Walter L. Huber Research Prize by ASCE, and the Construction Management Award by ASCE.

He has been designated as a Distinguished Executive and twice a Meritorious Executive in the Senior

Executive Service in the U.S. Government.

Jesse A. Story

Mr. Story is a native of Southern Illinois and attended the University of Missouri at Rolla (formerly

the Missouri School of Mines), graduating in 1961 with a Bachelor of Science in Civil Engineering.

Mr. Story started his career in 1961 with the Illinois Department of Transportation (IDOT) District

Office in Carbondale. His primary positions with IDOT were Project Engineer and Resident Engineer for

interstate construction projects. In 1966, he accepted an appointment with the Federal Highway

Administration as an Area Engineer in Kentucky. He has held various positions with the Federal Highway

263
Administration since 1966 and is currently the Chief of the Program Management Branch of the

Construction and Maintenance Division in Washington, DC.

Richard H. Sullivan

Mr. Sullivan is the Executive Director of the American Public Works Association in Chicago.

Before his position as Executive Director, Richard served as the Associate Executive Director for

Management and Research at APWA. During his 20 year tenure in that position, he designed,

implemented, and was responsible for technology transfer for over 60 research projects. The research

program Mr. Sullivan manages and oversees as Executive Director is broad-based, ranging from pavement

rehabilitation techniques, new technologies for water resources, and administrative procedures such as

privatization.

Before joining the APWA staff, Mr. Sullivan worked as Public Works Director in Atwater, CA, and

as Assistant Public Works Director in Phoenix, AZ.

Author of numerous publications that focus on results of APWA Research Foundation activities, Mr.

Sullivan is an active member in the International City Managers Association, Water Environment

Foundation (formerly known as Water Pollution Control Federation), and the American Society of

Association Executives.

Mr. Sullivan will present his technology transfer activities in promoting proven technologies to

public works departments. He will focus his presentation on demonstration programs-what works and

what doesn't-from the APWA perspective.

Jeffrey J. Walaszek

Mr. Walaszek is Chief of Public Affairs and Marketing Communications at the U.S. Army

Construction Engineering Research Laboratories in Champaign, IL. Mr. Walaszek manages the Army

Corps of Engineers Facilities Engineering Applications Program Information Center, which promotes and

publicizes the availability of innovative technologies for military facilities. Mr. Walaszek had been

involved in several Army-level technology transfer initiatives, most recently chairing a committee to

develop a technology transfer planning process. Mr. Walaszek brings a marketing perspective to

technology transfer, with a Bachelor's degree in Public Relations from Northern Illinois University and

a Master's degree in Mass Communications from the University of Illinois at Chicago. His master's thesis

described a communications strategy to support technology transfer.

C. Michael Walton

C. Michael Walton received his Bachelor of Science in Civil Engineering from the Virginia Military

Institute in 1963, and his Master's (1969) and Ph.D. (1971) in Civil Engineering (Transportation) from

North Carolina State University. Administrative and management experience include Transportation

Economist, Office of the Secretary, U.S. Department of Transportation and Transportation Planning

Engineer, North Carolina State Highway Commission. He is Paul D. and Betty Robertson Meek

Centennial Professor in Engineering and Chairman of the Department of Civil Engineering at the

University of Texas at Austin. He holds a joint academic appointment in the Lyndon B. Johnson School

of Public Affairs. In addition, he has been active in sponsored research and consulting related to public

and private participation and transportation engineering and analysis for approximately 28 years.

264
Dr. Walton has been involved in research associated with truck sizes and weights, economic and

engineering implications of LCV's, intermodal operations, containerization and institutional issues

impacting productivity in domestic freight service and advanced technology (IVHS). He has served as

policy consultant for the Heavy Vehicle Electronic License Plate (HELP/CRESCENT) project, an

international, multistate authority, and motor carrier industry effort to explore applications of new

technology.

Dr. Walton served as Chairman of the Transportation Research Board Committee on Motor Vehicle

Size and Weights and the Committee of Relationships between Vehicle Configurations and Highway

Design (Turner Proposal). He was a member of the National Academy of Sciences/Transportation

Research Board Technical Review Panel for the National Truck Size and Weight Study, and the National

Academy of Sciences Double-Trailer Truck Monitoring Study mandated by the Surface Transportation

Assistance Act of 1982. Currently, he chairs the technical committee on Commercial Vehicle Operations

in IVHS America.

Dr. Walton serves as Past-Chairman of the Executive Committee of the Transportation Research

Board. The American Society of Civil Engineers has recognized Dr. Walton as the recipient of both the

Harland Bartholomew Award and the Frank M. Masters Transportation Engineering Award for his

contributions to urban transportation planning and transportation engineering, respectively.

In related activities he is a member of the Transportation Research Board, American Society of Civil

Engineers, Institute of Transportation Engineers, Operations Research Society of America, Urban Land

Institute, National Society of Professional Engineers and IVHS America. He has published approximately

240 journal articles and reports on transportation engineering, planning, policy, and economics and

presented over 250 invited papers and lectures.

Thomas D. White

Thomas White is an Associate Professor of Civil Engineering at Purdue University, where he

received his Ph.D. in 1981.

Past work experience includes the position as Chief of the Materials Research Center (MRC), U.S.

Army Waterways Experiment Station (USAWES). The MRC laboratory conducts research and paving

materials evaluation for the U.S. Army Corps of Engineers, U.S. Air Force and Federal Aviation

Administration. Consultant support was provided to the Chief of Engineers in evaluating pavement

failures and in pavement construction. Before joining the staff at Purdue, he was Chief of the Pavement

Systems Division at USAWES and was responsible for conduct of research and investigational activities

of a staff of between 50 and 60. Over half of these were professionals involved in studies in areas such

as pavement management, analysis, materials, design, construction, evaluation, and maintenance involving

laboratory tests, field investigations, and analytical studies of pavements.

Dr. White has conducted laboratory and field investigations of pavement materials, pavement test

sections, and prototype pavements. He has participated in analysis of test sections and development of

pavement design criteria. Currently he is the principle investigator on projects to develop an overlay

design procedure for flexible and rigid pavements in Indiana and evaluation of nondestructive testing

equipment. He is also involved in projects concerned with developing pavement maintenance and

management systems.

265
Ronald J. Zabilski

Ron Zabilski is a civil engineer with 14 years of experience in facility construction and maintenance.

He has been with the Stone & Webster organization for 10 years.

For the past 6 years, Mr. Zabilski has been demonstrating the feasibility of three-dimensional

computer graphics in the construction environment with computer-generated construction sequence models,

construction accessibility studies, and crane sizing and rigging studies.

In this time he has been responsible for managing development of the integrated construction

management system, COMMANDS, which integrates three-dimensional computer graphics with a central

relational database for automatic quantity takeoffs, construction sequence planning, automated project

scheduling, and construction progress reporting. Mr. Zabilski has published six papers on these subjects.

Mr. Zabilski is also a specialist in the Construction Innovations Group, and is responsible for

development and review of new cost-saving construction techniques and practices in support of field

construction activities. Recently he became a member of the new CII Constructibility Education Action

Team.

Mr. Zabilski has a B.S. in Civil Engineering (1978) and an MBA (1990) from Northeastern

University.

266
REPORT DOCUMENTATION PAGE 1p

Pubkc tonrng burdenil" for this col n of ,,to~raon is estNat to erage 'how rUG•. ,dudini the fst I um t ed" a aaeing lta soaaL

gahawl ad aittififlgh ata ewdad. and icomftn a9 & d aZ~ wm th ola of Sedr WSvatol 7 ~g Wabuden aetfasil or say o~ wn of its, €OtIedton of information. mcInudang s stsonu I, .edlut(ng this urd .n to Washington Neadqu" wete Serusc oir'ctorese f"t In0f atlolm O Oersbo •w a 1 I . ii mt a1fl non Davis Hihway, Suite 1204. Arlington. VA 22202-4302.4nd to this Oft of Manage4ent and ludgit. Papervork Iladucton Project (0104 IOU). Washington. DC 1014 ,

1. AGENCY USE ONLY (Leave b/ank) 3. REPORT DATE 3. REPORT TYPE AND DATES COVERED ! June 1993 1992-1993

4. TITLE AND SUBTITLE S. FUNDING NUMBERS

Challenges and Opportunities for Innovation in the Public

Works Infrastructure

L. AUTHOR(S)

Moonja P. Kim, Diego Echeverry, Guruprasad N. Rao

7. PERFORMING ORGANIZATION NAME(S) AND ADORESS(ES) 8. PERFORMING ORGANIZATION

U.S. Army Construction Engineering Research Laboratories REPORT NUMBER

P.O. Box 4005

Champaign, IL 61820-1305

9. SPONSORING/ MONITORING AGENCY NAME(S) AND ADDRESS(ES) 10. SPONSORING/ MONITORING

AGENCY REPORT NUMBFR

U.S. Army Corps of Engineers

Institute for Water Resources IWR Report 93-FIS-3

Casey Building

Ft. Belvoir, VA 22060-5586

I1. SUPPLEMENTARY NOTES

12a. DISTRIBUTION /AVAILABILITY STATEMENT 12b. DISTRIBUTION CODE

Approved for public release; distribution unlimited

13. ABSTRACT (Maximum 200 words)

This report documents the results of an indepth study and workshop which could

be applied to overcome barriers to innovation and the use of innovative technology

within the nation's public works infrastructure. This is the third in a series

of reports prepared to support the Federal Infrastructure Strategy Initiative, a

3-year program to explore the development of an integrated Federal infrastructure

strategy. The program was initiated as one of the President's budget items for

Fiscal Year (FY) 1991 and approved by Congress. The program is overseen by the

U.S. Army Corps of Engineers (USACE) Directorate of Civil Works, and the Corps'

Institute for Water Resources (IWR) has detailed management responsibility.

14. SUBJECT TERMS IS. NUMBER OF PAGES

Infrastructure, engineering, innovation, public works, 270

research and development, Federal funding 16. PRICE CODE

17. SECURITY CLASSIFICATION 18. SECURITY CLASSIFICATION 19. SECURITY CLASSIFICATION 20. LIMITATION OF ABSTRACT

OF REPORT OF THIS PAGE OF ABSTRACT

Unclassified Unclassified Unclassified Unlimited

NSN 754001-280-5500 Standard Form 298 (Rev 2-89) Prescribed by ANSI Sld Z39-18

298-102
0

Federal Infrastructure Strategy Program

U.S. Arm Corps of Engineers