Common Misconceptions in Job Order Contracting
Job Order Contracting (JOC) is a procurement method that has been gaining popularity in the commercial construction industry. It allows for faster and more efficient completion of numerous small to medium-sized projects by using pre-negotiated contracts with specific contractors. However, despite its benefits, there are still many misconceptions surrounding JOC that often lead to hesitation or resistance in implementing it. In this document, we will address and debunk some of the most common misconceptions about JOC in commercial construction.
Misconception 1: JOC is only suitable for small projects
It is a common misconception that Job Order Contracting can only be used for small or simple projects. In reality, JOC is a flexible procurement method that can apply to a wide range of construction projects, including larger and more complex ones. The key is to properly define the scope of work and identify the right JOC contractor for the project. In fact, many large organizations such as school districts and government agencies have successfully used JOC for major building renovations and capital improvement projects.
Misconception 2: JOC only benefits the contractor
Another misconception is that JOC only benefits the contractor and not the owner. This couldn't be further from the truth. With JOC, owners can save time and money by avoiding the traditional bidding process and negotiating pre-priced contracts with contractors. Furthermore, since JOC projects are completed on a cost-plus basis, owners have more control over project costs and can easily track expenses.
Misconception 3: JOC limits design and construction flexibility
Some believe that using JOC means sacrificing design and construction flexibility. However, this is not the case. JOC allows for greater flexibility in terms of design changes and modifications during the project as long as they are within the scope of work and budget. In fact, JOC encourages collaboration between owners, contractors, and designers to find the most efficient and cost-effective solutions.
Misconception 4: JOC lacks competitive bidding
One of the biggest misconceptions about JOC is that it eliminates competitive bidding. On the contrary, JOC utilizes a two-phase bidding process where contractors must first qualify through a competitive selection process based on their qualifications, experience, and pricing. Once qualified, contractors then compete for individual projects under the pre-negotiated contract terms, ensuring fair and competitive pricing.
Misconception 5: JOC is not transparent
JOC is often viewed as lacking transparency due to the use of pre-priced contracts and cost-plus pricing. However, JOC actually provides a high level of transparency throughout the project. Owners have access to detailed cost breakdowns and can track expenses in real-time, ensuring accountability and preventing cost overruns.
Conclusion
In conclusion, it is important to address and correct these misconceptions about Job Order Contracting in commercial construction. By understanding the true benefits of JOC, owners can make informed decisions on whether it is the right procurement method for their projects. With its ability to save time, money, and provide flexibility, JOC is a valuable tool for any commercial construction project. So, it is essential to dispel these misconceptions and educate the industry on the true potential of Job Order Contracting. Contact us today to learn how FMG Construction can help with your next set of commercial construction projects.
