University Reins in Project Costs and Time Delays with Construction Auditing
Founded in 1817, the University of Michigan is one of the largest graduate and undergraduate colleges in the United States. The university has approximately 42,000 students from over 100 countries around the world
and provides students with access to over 200 different degree programs.
The University of Michigan campus spans a large section of Ann Arbor, Michigan, and hosts a nuclear reactor
(now decommissioned), a trauma hospital, the Ronald McDonald care facility, several sports arenas, and
student and family housing. To meet the growing and evolving needs of its students and other constituents, the university is constantly undergoing changes and renovations. One of the largest changes involves a complex $523 million move/rebuild of their Children’s and Women’s Hospital. The project will involve building a new facility, adjacent to an active hospital; moving systems, equipment and patients into the new facility; and then dismantling the old building. The university realized that, due to the intricacies of the move, coupled with donors’ inability to be as generous as they had been in the past, maintaining the financial and time budgets would be crucial to the success of the project.
Control Solutions was hired by the University of Michigan to support the audit team already in place at the
university. Though some of the existing team members had construction audit backgrounds, their staff size
is limited in relation to the amount of other audit work that needs to be completed. Additionally, management felt they needed to supplement the knowledge the staff possessed to plan and execute the best audit possible.
Control Solutions was engaged to perform three tasks:
- Help perform a risk analysis and design an audit plan that the team could follow
- Train the existing staff to be able to carry out the audit as designed
- Act as a field expert as the audit progressed
The risk assessment was completed as a collaborative effort between Control Solutions and the University
of Michigan. Control Solutions helped by incorporating known risk factors for construction and risks specific to the project and the university. We facilitated a session to review construction contracts, identify the key roles and recommend improvements to the contracts.
Summary of Results
Control Solutions worked with the University of Michigan over the course of two weeks and developed
a robust risk matrix and audit plan that incorporated everything from initial project planning and funding all
the way through the final move-in of patients. Risk areas were broken into the following categories:
- Change Management
- Financial Management
- Regulatory Reporting
- Transition Management
Additionally, audit steps were broken down into various phases based on the project deadlines and stages
of construction. The audit will be conducted in five phases over six years. The last and final phase will be
a follow-up review six months after construction is completed to identify any hidden defects.