Public versus Private Perceptions on Hiring an External Program Manager

As construction industry service providers have expanded their service offerings to meet the demands of construction owners, new management techniques have evolved. One of these management techniques, program management, has emerged as a service offering that covers all aspects of the construction life cycle. This paper reviews specific topics related to the hiring of an external program management service provider, including fees, types of firms, factors considered, and organizational models. Each of these topics was addressed in a recent survey of nonresidential construction industry owners. The survey results are first presented for all respondents and are then segregated by sector (public and private sector respondents). It is apparent that the use of program management firms is still lacking in comparison to the use of other firms and service providers and that construction owners typically use an organizational model that allows them to retain control of their construction program, which true external program management does not. Also, the survey results showed differences between the public and private sectors in the factors considered when hiring a program manager. Because program management is the ultimate form of outsourcing, it is both a particularly timely topic and a topic that is very relevant to construction professionals.