In today’s market place competition tends to drive prices down. One solution to having a lower cost to meet the lower prices demanded by the market is innovation. We all thought we were getting smarter when we could just get a bigger crane to do our work. This may be true and even helpful at times, but bigger cranes can be expensive. What we should be doing is finding new ways to use older, owned equipment.

If we have to place a heavy load in a small isolated space, we could try to convert an existing crane boom or, even better, an old derrick boom into a gin pole or a Chicago boom. You could also build a wheeled buggy to carry your load into the confined area. Think about it. Maybe it won’t work, but then again, maybe it will.

When I was with Tri State Steel Construction, we had a project where we had to install steel grating for a bridge deck. The Engineer of Record would not permit us to use a crane or any heavy lifting equipment that ran on the grating before the concrete was poured. We decided to design and build a jinniwink. This was a vertical column with a horizontal beam across the top. It was secured to a moveable frame, and its load falls came from an air hoist on the frame. We were short on work at the time; so we had four of our foremen build it in the yard. They decided to add bracing here and there until it looked like a prehistoric bird. We called it the Pterodactyl. We put that name on the drawing submitted to the state for approval. The general contractor and all of the workers liked the name and used it throughout the job. We moved the frame with another air hoist. We also designed a buggy, moved by the air hoist, to take the grating sections out to the Pterodactyl. It was inexpensive to build, it met the engineer’s requirements, and lo and behold, we made money.

I have built gin poles out of wood with rope falls for load and foot guys. Now that is really inexpensive. When I was with Bethlehem Steel we designed and built out of pipe a one-ton guy derrick. Also with Bethlehem we had a building to erect that was a guy derrick job, but it was so narrow that the back guys would be overstressed when we went to the street. We took the upper rotating assembly of a 20-ton Lorain truck crane and put it on a moveable frame in the center bay of the building. We moved it back and forth in the long direction and used air motors and four of the next tier’s columns to jump the crane two floors at a time. When we got to the top, we turned the wheels around, moved it to the edge of the building, and dismantled it with a truck crane on the ground. This was not a new idea. Our project manager had seen a similar arrangement in Pittsburgh being used by another erector. Our project was in Detroit. Evidently our competitors had not been to Pittsburgh at the right time. Innovation does not mean it has to be your idea. You just have to be willing to implement another’s ideas.

I have been fortunate in having worked with a lot of unusual equipment arrangements. I worked on a blast furnace that was built from the ground up in between two other blast furnaces. Space was at a premium. The main erecting equipment was a 35-ton stiff leg derrick on a square tower. In order to find the main hoisting engine, you had to follow the cables through a maze of piping and ductwork. On each of the two forward legs of the tower was a Chicago boom. There was a Chicago boom on a stove that erected the dust catcher and helped the stiff leg with the main section of down comer. The stack was erected with a stack rig inside the stiff leg’s tower. We did have a truck crane for the erection of the cast house.

Innovation is not limited to special equipment. Different ways of doing things also help your cause. If you are using a Chicago boom on an exterior column of a building to remove other equipment or materials, tilt the boom base so that the loaded boom swings outboard on its own and you only have to pull back (by hand) an empty boom. If you want to have a lifting beam made out of pipe with a cable bridle for hoisting, and you only want compression in the pipe (no bending), offset the bridle hitch from the load hitch so that the bending moments cancel each other. This makes the pipe smaller and more efficient. If you want to use a building’s beam to support a temporary load, and that beam will not take it, shore it from the beam below, distribute the load to each beam in accordance with each I/L ratio ( moment of inertia over length) and check the shore for the amount of load to be transferred. Usually a 6” x 6” timber will suffice. Don’t go to the trouble of reinforcing the existing beam. There are a lot of these things to use. You know a lot of them. Put on your thinking cap and work on your memory. Most of the ideas you have had in the past can be used again.

When you work in industrial plants where you cannot disrupt production, or places like Disney where you cannot disrupt the movement of the customers, innovation really comes into play. When you have to rehab an existing structure, look for different ways to lift or move the elements of the structure; old stuff out and new stuff in. You can build low-capacity guy derricks, stiff leg derricks, Chicago booms and gin poles out of timbers, say 6”x 6” or 8”x 8”, and pipe of various diameters. These can be very cost effective. You will find that your workers like the idea of working with something different, and their productivity will go up. There is a great deal of personal satisfaction, too, when you feel that you really have built a better mouse trap.

Like all erection schemes innovation is a combination of engineering and common sense. Once you build something, do not throw it away. It can be used again, or it can be modified to use again. Each time this is done, your cost exposure goes down.

I am sure that my crane rental friends are miffed about this. My last piece of advice is that if all else fails, rent a big crane.

Alan T. (Ted) Sheppard, P.E , earned a BE degree in civil engineering from Yale University and is a registered professional engineer in four states and a professional member of AISC. His many years of work experience include stints in Bethlehem Steel’s fabricated steel construction department working on mill buildings, a blast furnace, and the Niagara Arch Bridge and at BSCorp in construction of two oceanographic survey ships, mobile offshore drilling units and drydock support. He served as president of Tri State Steel Construction in a Strongsville, Ohio, a regional bridge erector and placer of rebar on bridge projects, before becoming consultant for the fabricated steel construction industry with The DuRoss Group, Inc.

Blog by Ron Thompson

Introduction by Bruce Basden:

This is the time of the year that companies review policies and procedures. We have found that we sometimes wander away from good business practices in our efforts to get a job going, leaving ourselves vulnerable to bad contract language. This article from Ron Thompson points out some things we need to watch for when reviewing contract terms.

You have probably been there a 1000 times! You have bid a job, fairly certain you will get the job and then the old, dreaded 40-page “Subcontractors Agreement” comes flying in from your customer. Sign and send back is the request. Digging through the Killer Subcontract Agreement can be onerous, written in nearly incomprehensible terms, then you come to the Indemnity section and the indemnification clause creates a fairly straightforward obligation: the subcontractor (you) will defend and pay damages if the General Contractor, Owner and Architect are sued for injury arising out of the subcontractors’ (your) work.

Knowing Risk Transfer

Contractual risk transfer is generally achieved through two types of provisions. The contract may include an : “indemnification” clause, an “additional insured” clause (sometimes part of a broader “insurance” clause), or both. These provisions create unique obligations for the subcontractor (you) and should be carefully reviewed because it could possibly create additional exposures that may not be covered in your General Liability policy.

Coverage Issues on Subcontractors General Liability Policy

By signing the Killer Subcontract Agreement in its original form without negotiating more favorable terms, may be exposing your company to additional unwanted exposure and potential uncovered claims. In the indemnity section, the contract usually states that you (the subcontractor) will hold harmless the General Contractor, Owner and Architect for all claims, damages, etc for all liability arising out of the subcontractors (your) work, in essence requiring you to handle, indemnify and defend claims caused by the General Contractor’s negligence, even in the absence of fault on the part of the subcontractor (you). The General Contractor or Owner may have had faulty general supervision, failed to provide a safe place to work or failure to take reasonable precautions and adopt proper safeguards to protect workers from injuries, which you the subcontractor had no fault in. But the definition of all liability arising out of your work could potentially drag you (subcontractor) in to defend and indemnify the GC and Owner.

Here Is the Coverage Problem

Many court decisions applied coverage even when the result of subcontractors (your) negligence was absent because of the broad interpretation by the courts of “ liability arising out” definition of subcontractors work, found in the construction agreement. In 2004, insurance carriers changed the wording in the additional insured endorsements on your general liability policy to the injury or damage must be “ caused, in whole or in part” by subcontractors acts or omissions. The revised wording is more restricted and narrows the definition of what your liability coverage offers. Your coverage now specifically states that in order to indemnify the GC, Owner and Architect, the injury or damage must be directly caused by you in whole or in part. The “ liability arising out of” language is gone due to its broader application and coverage for additional insureds. This is good, you think?

Why Is This Bad for Subcontractors?

If the subcontractors agreement mandates that your policy grants the GC, Owner and Architect additional insured status for injuries and claims “ arising out of” subcontractors work, and your general liability policy restricts coverage to claims to only “ caused in whole or in part”, there is a disconnect where the contract you signed doesn’t match your insurance coverage in your liability policy. The contract language is much broader than what your liability policy covers.

When this happens and you are tendered a claim or lawsuit by the GC, Owner or Architect, the dreaded coverage disclaimer letter arrives in the mail from carrier stating “no coverage”, you may be stuck with an uncovered claim and possible Breach of Contract exposure which usually isn’t covered by the policy either. The contract you signed states “ arising out of or connected to” your work, but your insurance policy states coverages for claims “caused in whole or in part” by your work. 

Conclusion

So be diligent in reviewing your construction agreements and make certain through your attorney and/or insurance advisor reviews the coverages in your general liability policy are sufficient to address the exposures that you have agreed to in your construction contract. Parties to construction contracts (specially subcontractors) must use great care to determine if proper coverage is in place to avoid a potential coverage disaster. Don’t just sign the contract and send back without thoroughly reviewing and negotiating more favorable terms.

Ron Thompson has spent over 25 years as a broker and risk consultant for the heavy construction industry. For the past 12 years, he has managed the Heavy Construction insurance division at Sovereign Insurance Group in Dallas, Texas.

When the economy affects your business there is the normal reaction of cutting costs by reducing spending and managing cash. It is proven that in every downturn there are companies that not only survive but prosper. With a strategic insight you can not only stabilize your company’s current position but also prepare for taking advantage of the changes in your business sector. Who knows what the future may hold for the few who develop a clear vision of their marketplace.

It is easy to guide a ship in calm waters but the captain and crew that can weather the worst storms come away stronger and last longer. As Keynote Speaker at the SEAA Convention, Guy Gruenberg will share some of his insights of how we got to where we are today and what the future may hold for those who focus on improving their business model. This Keynote will also touch on relevant topics that include budgeting, understanding your break-even points, pricing jobs to zero, potential new areas of revenue, successful relationship building and developing a strategy that works.

Register for the convention today at www.seaa.net.

If you want more business or want to be more profitable, SEAA Convention Workshops are the most efficient way to learn what you need to know. This year’s workshops will help you better manage your business with these timely topics:

Session: “GPS Fleet Management Systems”
Presenter: Gary Hallgren, CEO | Remote Dynamics, Inc./REDIview

Session: “Weathering the Storm - Managing your Business in a Turbulent Economy”
Presenter: Gregg Schoppman, Senior Consultant | FMI Corporation

Session: “AISC Certification Program – How to Streamline Your Operations to Become More Efficient & More Profitable”
Presenters: Larry Martof & Lee Pielaet, Lead Auditors | Quality Management Company, LLC (QMC)

Session: “Preparing for OSHA’s New Enforcement and Penalty Programs”
Presenter: Frank Kollman, Attorney | Kollman & Saucier, PA

Session: “NCCCO Overview: Crane Personnel Certification and Regulatory Environment”
Presenter: Joe Oliva, Program Manager/Regulatory Affairs Coordinator | National Certification for Crane Operator Certification (NCCCO)

Session: “A 101 Seminar on Structural Steel High Strength Installation & Inspection Procedures”
Presenter: Gene Mitchell, VP | G.W.Y., Inc.

Session: “NCCER: Crane Operator Certification”
Presenters: Steve Greene, Vice President | National Center Construction Education & Research (NCCER) & Ted Blanton, Sr., President | North American Crane Bureau, Inc. (NACB)

Session: “Increasing Efficiency in the Field”
Presenter: Guy Gruenberg, President | Grow Consulting, Inc. & Senior Partner | Filthy Rich Contractor

Session: “NCCER: Developing Your Workforce”
Presenters: Don Whyte, President & Steve Greene, Vice President, | National Center for Construction Education & Research (NCCER)

Session: “2010 Construction Industry Overview”
Presenter: Gregg Schoppman, Senior Consultant | FMI Corporation

Keynote Address: “How to Survive and Prosper Through the Current Economic Times”
Presenter: Guy Gruenberg, President | Grow Consulting, Inc. & Senior Partner | Filthy Rich Contractor

There is still time to register for the 2010 SEAA National Convention, set for March 11-13, 2010 at the Grand Hyatt Tampa Bay, in Florida, just visit us online at: www.seaa.net. We accept all major credit cards through our secured events registration page. The 2010 SEAA Convention Committee would like to express our sincere thanks to these partners:

Are you interested in best practices and innovative solutions to your most difficult business challenges? Looking to expand your network and advance your career? If so, we invite you to join us in Tampa, Florida, for the 38th SEAA National Convention & Trade Show – centered on this year’s theme: 2010 Steel Erectors Conclave!

In March 2010, our home-state of Florida will roll out the red carpet for fellow members, friends and colleagues of the Steel Erectors Association of America (SEAA), March 10-14, 2010, at the Grand Hyatt - Tampa Bay, only five short minutes from the Tampa Airport. Outstanding among Tampa Bay hotels, this AAA Four-Diamond, 35-acre resort-like hotel is situated along a wildlife preserve on the upper shores of the bay. We know you’ll find these accommodations a perfect setting for the planned sessions and exhibits.

There is something for everyone, so bring a colleague and learn about what new industry trends may affect your business; professional development sessions from our slate of top-notch industry speakers. You’ll see “hands-on demonstrations” in the SEAA Exhibit Hall, featuring over 40+ national suppliers and service companies.

There will be two great networking socials to meet and build relationships with fellow professionals, owners and suppliers. The Golf Outing is set for TPC – Tampa Bay. And for those avid anglers join SEAA’s Inshore Private Gulf-Stream Fishing Charter. Don’t miss out on the 1st Annual SEAA Crane Rodeo, sponsored by: North American Crane Bureau, Inc.

Meet us in Tampa, where together we can continue to build this great profession of ours.

From 2010 SEAA Convention Host:
Bruce Nichols, Geoff Kress, and Rick Vassallo
Gardner-Watson Decking, Inc.
Oldsmar, FL

Produced by the SEAA® and NISD®, this document has some great examples for easily dealing with OSHA Regulations. If you follow the clear and understandable sketches, there will be a positive impact on project costs. The guide’s emphasis on collaboration and pre-job planning shows constructors how to get started on a project. Engineers, fabricators and erectors should provide input to the detailer so that the project can be started with everyone on the same page. The guide comes with downloadable CAD files. Everyone in the fabricated steel construction industry should have this guide in the company library. It is a money-maker. For a limited time the guide is available at an introductory price of $79.95. To place your order, visit www.seaa.net/order/product_list.htm. All major credit cards are accepted.

• Raizin Iron, Inc.
  Willis Point, TX 75169
• Tri State Steel Erectors
  Glen Burnie, MD 21061
  Custom Truck & Equipment (CTE)
  Kansas City, MO 64125
• Diversified Systems, Inc.
  Greenville, SC 29610
• L & L Construction, Inc.
  Quakertown, PA 18951
• Design Data
  Lincoln, NE 68512
• Advance Steel Erection, Inc.
  Arlington Heights, IL 60005
• MSD Building Corp
  Humble, TX 77338
• Liebherr Cranes, Inc.
  Newport News, VA 23607

By Angela Richie Stephens, Stites & Harbison

A new standard, similar to LEED, may soon apply to all new public and private construction and major renovations, except for low-rise residential buildings.

On January 26, 2010, the American Society of Heating Refrigerating and Air-Conditioning Engineers (ASHRAE), the Illuminating Engineering Society (IES), and the USGBC published ASHRAE 189.1, a new standard for the design of High-Performance Green Buildings, after being approved by the American National Standards Institute (ANSI) on January 22, 2010. ASHRAE 189.1 was written such that it can be adopted by states and incorporated into building codes.

On January 26, 2010, the American Society of Heating Refrigerating and Air-Conditioning Engineers (ASHRAE), the Illuminating Engineering Society (IES), and the USGBC published ASHRAE 189.1, a new standard for the design of High-Performance Green Buildings, after being approved by the American National Standards Institute (ANSI) on January 22, 2010. ASHRAE 189.1 was written such that it can be adopted by states and incorporated into building codes.

In 1998, the U.S. Green Building Council (USGBC) created the Leadership in Energy and Environmental Design (LEED) Green Building Rating System. With the exception of 18 states that mandate state-owned buildings be designed and constructed to achieve a LEED Silver rating or higher, LEED is a voluntary program that private owners may choose to adopt and apply to the design and construction of their buildings.

In 2004, those 18 states began passing regulations that mandated sustainable design and construction practices (such as LEED certification) for state-owned buildings. Some states that have mandated sustainable design and construction practices for public buildings are now considering sustainable design and construction practices for private construction through the development of green building codes. As mentioned above, LEED was written as a voluntary program, and was not written to be enforced as a building code.

On January 26, 2010, the American Society of Heating Refrigerating and Air-Conditioning Engineers (ASHRAE), the Illuminating Engineering Society (IES), and the USGBC published ASHRAE 189.1, a new standard for the design of High-Performance Green Buildings, after being approved by the American National Standards Institute (ANSI) on January 22, 2010. ASHRAE 189.1 was written such that it can be adopted by states and incorporated into building codes. This new ANSI standard, if adopted by a state, will apply to all new public and private construction and major renovations, except for low-rise residential buildings.

ASHRAE 189.1 is similar to LEED in that it includes requirements relating to site sustainability, water use efficiency, energy efficiency, indoor environmental quality, the building’s impact on the atmosphere, materials and resources, and construction and plans for operation. It is ASHRAE’s intent that the 189.1 standard will compliment LEED, and will serve as the baseline for LEED or other similar rating systems. Some examples of ASHRAE 189.1’s requirements include mandating that (1) owners or developers build on previously developed sites or on a Greenfield site within one-half mile of a developed area, (2) architects design for the future installation of on-site renewable energy, and (3) owners track energy consumption of the building on a periodic basis. A copy of the ASHRAE 189.1 can be previewed at http://www.ashrae.org/publications/page/927.

Angela Stephens, a LEED Accredited Professional, devotes her practice primarily to construction law. She is a frequent speaker and author of construction law topics. For more information about these regulations or other green initiatives which may impact your business, please contact Angela Stephens, Esq., LEED AP, at astephens@stites.com.