For the “Wake Up Big Canoe” group and their question under Sconti complex - Did this get out of hand or what?
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From the article, “Big Canoe should hire amenities manager, Roger Klask says,” by Ann Dickerson, Smoke Signals, November 2007, Page 3A.
“Crouch asked board members to approve a document he wrote in response to questions by some of the Finance/Audit Committee members.” [A document on his historical view of how the Sconti Restaurant rebuild played out.]
One Director wouldn’t approve Mr. Crouch’s document.
“The board did not take a vote on the document presented by Crouch.”
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Of special interest from Mr. Bob Crouch’s historical view document regarding the new Sconti clubhouse:
“Questions have been raised from sources with no construction or project management experience regarding claims that the clubhouse project is on [over] budget. They question a volunteer committee with vast experience. Simply stated, when the scope of a project changes the budget changes. The manager of that project then works to deliver it on the revised budget. Missing the budget means that, given the same scope, costs have gotten out of line. To date this has not occurred due to the Herculean efforts of the Building Committee.”
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Let’s read the following again, “Questions have been raised from sources with no construction or project management experience.”
The following is a response from one of those so-called inexperienced sources:
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A property owner’s and retired certified project manager’s analysis of the POA Board President’s historical view (document) of how the Sconti Restaurant rebuild played out:
Overall Mr. Crouch’s historical view regarding the new Sconti clubhouse sounds good…to the untrained non-project management eye.
As a project manager I was responsible for bringing in or completing projects in scope, on time, and on budget.
It is obvious that the key factor for this project was time with all else left to the wind. As a long time certified project manager, this project would be a prime example of how not to do a project.
Justifying changes in a budget by project scope changes [change orders] and still denying a bid process in the interest of time may save time but will accelerate cost.
The continual floating scope-changes [change orders] basically indicate that there was no well defined or planned project to begin with. Therefore, the continual changes in project content and objective cause what is known as scope creep. Without a firm project plan or firm project requirements a timeline scope creep changes must be accepted or the project will fall short of expectations.
Scope creep is a well-known cause of budget creep [budget increases] which puts the Sconti project in the position it is in today.
While scope creep can occur on any project it is usually managed to limit impact. The Sconti project appears to be defined and based on little other than scope creep [change orders]. This project appears to be an almost totally seat-of-pants operation. What project management there is appears to be after the fact project management.
If you ignore the basic practices and principles contained in the Project Management Institute’s, PMBOK (Project Management Body of Knowledge), there is no way, other than pure luck, that this or any project can be completed in an cost effective manner.
Change Order managed development is probably the most cost-escalating method of performing a project. To justify the Sconti cost because there have been so many scope changes is to say, “We did a project incorrectly from day one.” It was poorly initiated, improperly planned, and improperly executed from day one or there would not have been so many, many scope changes [change orders]. If I were to grade it, I would give it a “D” taking into account some well-intention, well-meaning individuals. The truth is that in my heart I know had I done a project in this manner, I would have been fired…period!
[Here the writer does into the elements of successful PMBOK project management and grades the Sconti project on each of the elements. Not published due to length.]
The Sconti Project failed to follow many of the project process areas either completely or even in part. The Sconti project was treated more like a rush order or rush to judgment.
Because communications were improperly (not done) in the beginning (no communication plan or one that was not properly thought through), complete customer and property owner reaction and feedback were overlooked which caused the project requirements and scope to be ill defined. This caused major revisions to be made mid-stream and ultimately perpetuated almost constant revision.
The Sconti Committee cannot be blamed for this project’s failures. The project was doomed from the start to have accelerating costs. The added costs can only be blamed on misguided decisions of the current and past Board Presidents.
Mr. Crouch’s history, whether he realizes it or not, bears this out. There have been so many project management mistakes made that the Sconti Project could be used in training as to how not to do a project.
Regrettably, the committee is full of knowledgeable people who are well intended, but if unbalanced pressure is brought to bear, that forced them to go outside established processes and procedures, then there is no way that they could have been successful in managing cost.
In the case of the Sconti, poor Board leadership, pressure to rush, pressure to not involve the community up front, and pressure to get it done too quickly doomed this project from the start to rampant cost escalation. All of the experience in the world could not stop the avalanche once it was started.
When a project is mis-directed by upper management, no project manager can complete a project in scope, on time, and within budget. Bragging about your past successes and purported skills is not a guarantee of another successful project.
Proper planning, requirements collection for scope development, proper budgeting bolstered with proper bidding and contracting principles and frankly following all of the standard project management processes was how this project should have been approached.
Most, if not all principles of successful project management were thrown out the window for the sake of ego and bragging. In other words, substance was replaced by ego.
The Sconti Project, as it was handled, was a Trojan horse from day one. The POA property owners were sold a bad bill of goods and are having their wallets emptied by some individuals who say that they are doing a good job. Ask any of the Sconti Committee members with project management experience if they have been permitted to do build a fiscally responsible Sconti restaurant. If they are open and honest with you, they will say no.
It is said the board of directors could not stop this fiasco…probably because of restrictions place on them, lack of project management understanding, and lack of overall experience, they didn’t recognized the pending financial disaster.
The Sconti may wind up being a beautiful facility but the cost will be very dear. I am guessing the project will [be] in the neighborhood of five to seven million dollars more than it should have cost in the name of getting it done in a hurry.
The annual operating losses experienced in years past will seem like pocket change in comparison to this costly overrun along with the annual losses likely to be generated going forward.
The Sconti Project is Big Canoe’s equivalent to the government’s $600 dollar toilet seats and the $223 million dollar Alaskan bridge to nowhere (recently cancelled).
It is too bad we could not rally enough public outrage in this community early-on to stop this. Now we will all pay dearly and continue to pay as long as we live in Big Canoe.
Apathy has cost us millions and now we have to find a way to live with it.
I for one am outraged!
7 users commented in " What went wrong with the Sconti Restaurant Rebuild capital project. "
Follow-up comment rss or Leave a TrackbackYour assertion that costs increased due to change orders is not supported by the document you reference. The project was broken into phases which were tightly controlled by the rebuild Sconti committee. It is fully described in the document you reference as shown below.
“Did the Fast Track decision increase costs? No, the Building Committee has spent untold
hours to provide a cost effective clubhouse. The original plan was to sign a contract with
a complete scope of work in April 2007. The final construction documents delivered by
the Architect required changes resulting in cost estimates from the Constructor to be over
budget. The decision was made to break the work into separate phases and to place the
effort on obtaining adequate documents and costs within the budget. The work was
awarded incrementally to meet the schedule and to minimize costs. Phasing has allowed
time to bring costs in line while maintaining the schedule. The alternative of going ahead
with the original plan, in the opinion of the Building Committee, would have been a
disaster given the circumstances. This very professional Building Committee is made up
of volunteer property owners with over 200 years of construction experience. Another
alternative was to simply wait until all of the costs were finalized and award a single
scope of work. Not only would the project have been delayed indefinitely but also the
resulting increased costs would have been unacceptable.
Each of the phases that were approved fell within the approved budget from the Board.
The approval of payments resulting from that work followed the standard POA payment
process with multiple signoffs following project manager certification that the work was
satisfactorily completed.
The clubhouse budget has been changed on four occasions. All changes have been
thoroughly reviewed by the Board and communicated to property owners. The entire
Board voted on all changes and approved the first three unanimously and the last on a six
to one favorable vote. Three changes were to increase the function, quality and
appearance and one was an accounting change due to the insurance proceeds. The three
changes were to the scope of work and not because costs were not managed diligently.
The Building Committee has managed the project in a very professional manner with
review by the Board and communication to the property owners, resulting in a cost
effective, functional and attractive facility delivered as scheduled.”
I am certain that the Building Committee has put in a lot of hours in attempting to manage this project. Unfortunately, the fact remains that the project now nearing completion is nothing like what the property owners voted for. Let’s remember that there were at least 3 designs for this white elephant. Evidently, somewhere along the way, the design committee was not up to speed. To say the populace was kept informed of the change in scope is fatuous at best. When it became obvious that the scope was being changed to such a major extent, a vote of the property owners should have been held. The board gets by with this sort of thing because there is a general lethargy and apathy in the community. The fact remains that this was a no-bid project, no doubt increasing the costs substantially.
It is amazing to me that people are upset about a possible 1% fee on transfers when we are much more likely to see huge assessments to pay for such frivolities as a manager of amenities, another tennis pro, leaf vacuums, golf carts, and tree grinding while the infrastructure continues to decay.
Being realistic, if you knew what was going on, would you still buy in Big Canoe today?
I am right there with you. The real cost of building program is yet to come. I have never seen evidence any attempts to cut cost in this community that were implemented effectively. All I see is spend, spend, spend. To be a steward of other people’s money should require extra effort to spend instead of unbridled freedom. The board constantly points to the POA agreement giving them their right to spend. I never hear anyone say they have moral financial obligation to get the owner’s majority approval.
I suggest a complete operational and financial audit. I will be willing to head up the committee. Hopefully, the board will agree to allow us to audit our own community. Even, if we do not find anything that can save us money we will end the obvious perceptions that swim around the fiscal stewardship of this community.
In addition, I will propose that all financial records be provided to the community and minutes of any meeting held are public.
“WHY did the Big Canoe POA Board award a “NO-BID” Sconti Rebuild contract?”
I am retired from a successful career as a Senior Project Engineer, and as a Project Manager, having managed multi-million dollar projects. I fully understand NO-BID contracts.
In the corporate and governmental worlds, the awarding of very large NO-BID contracts always reaps of the possibility of kickbacks. Sometimes the misallocated money is used for other unapproved or unauthorized purposes; sometimes, the money goes elsewhere (to put it nicely). In any case, the awarding of a very large NO-BID contract to any firm creates the perfect conditions for fraud.
We have a tendency to overlook the inherent corruptibility of human nature. We would like to think that all people are good, but people are people. Most people are good, and some will always prey on the others. In any case, power brings out the greed in people.
In the past, has the Big Canoe community had people in responsible positions to steal big-time money from the community? If so, did the community elite clean up the mess in secret by giving the thief his exit papers, along with a no-disclosure statement attached to very large check? That is how it is done in the real corporate world, and in wealthy gated communities; as they say, it costs less money and there is NO bad publicity.
The real (and sad) problem is that, in these communities, this approach causes the cycle to repeat itself, over and over again; there is just too much money available for the taking and too little accountability.
Do you really want to live in Big Canoe: If you feel that you have very little control over the financial condition and direction of the community?
Do you really want to live in Big Canoe: If Big Canoe won’t do comprehensive background checks on ALL of its current and future POA Board members, and executive employees?
Do you really want to live in Big Canoe: If the Big Canoe “HOA” won’t have KPMG (or some other nationally know independent audit firm) to do a deep forensic audit of the Sconti Complex costs, as well as an audit of Big Canoe’s other financial records? And after doing these audits, to assist in installing a very firm set of financial controls, checks and balances?
I don’t and I won’t………………………..
Has anyone approached the POA to obtain access to the records? It seems the would have nice book or book of invoices and contracts?
You want to build a house to live in. You get an architect and get a plan. Before you build you make changes to the plan with the architect. When ready with the plan you put it out to bid with three builders you have researched. The builders review the scope of the work and if needed , ask questions to define job. The bids come back in and you pick a builder, usually the cheapest.
The chosen builder has given you a price for the complete job . You sign a contract.
Any changes hereafter, require a changeorder which is priced and accepted or rejected. The work gets done. You check the job for contractual adherence and quality problems.
A punch list is drawn up. The items are handled and you accept the house.
No hidden or extra costs -seems simple , doesn’t it?
“Has anyone approached the POA to obtain access to the records?”
Many times without results; as have others. Must be the reason for promise number 3 of the 6 promises.
Read promise no. 3 on “The Six Promises” web link on this website.
“The Directors must provide copies of any POA documents to any property owner upon their request (employee related documents will be the only exception).”