Poor management and insufficient funding contributed to major construction problems that have caused the fifth significant delay of Duke Kunshan University’s opening in three years.
The campus’ opening has been delayed another semester to Fall 2014. Construction slowed to almost a full stop in 2012 despite promises of development from the Kunshan government, which manages and funds the campus’ construction.
Currently, none of the campus’ six buildings are near completion. Duke administrators now expect that Kunshan developers will finish two of the campus’ six buildings by Spring 2014. Yet as of September 2012, Kunshan maintained that five of the six buildings would be ready by July 2013.
More significant than the delay is the difficulty Duke had working with the city of Kunshan in 2012 to get problems fixed and move construction along. Limited by its lack of leverage on the project and frustrated by the city’s lapses in communication, Duke approached the city in late 2012 refusing to move forward with the project unless the government adjusted its construction strategy and built buildings that met Duke’s standards for the campus. In response, the city of Kunshan recognized the persistent issues and is now rectifying construction management and increasing funding to get the project back on track.
A year of stalemate
In early 2012, administrators became aware of serious construction issues but did not fully understand their causes. Construction was slow, workmanship was shoddy, and there was little follow-through on Duke’s requests for solutions in the following months, said Paul Manning, director of the Office of Project Management and the University point of contact for DKU construction. Construction crews made almost no progress on the campus in 2012.
“In effect, they lost an entire year of really progressing,” he said.
Duke administrators’ concerns about the construction peaked in April, but Kunshan did not admit its management’s structural and fiscal failings until the end of 2012, Manning added.
“It took a while to understand what we’re dealing with because they don’t tell you much,” he said. “You have to delve in and figure out what the real issues are behind the consequences that you’re seeing.”
It became clear that there were some serious issues with the group managing DKU’s design and construction—a development group called Kunshan Science, Technology and Education Park. Kunshan construction workers are not highly skilled, so they learn as they go and work slowly, Manning noted.
Kunshan also had significantly underestimated how much money it needed to build a 200-acre campus that met Duke’s quality standards, Manning said. The cost of building DKU in the United States would be approximately $260 million, according to the 2011 Duke-Kunshan Planning Guide. Kunshan was trying to complete the project for less than that—skimping on quality—but Manning declined to give a specific amount.
The communication problem
Much of the campus’ construction has been plagued by information failings and lost or simply ignored requests. Communication between contractors and designers—sometimes between 40 and 50 different groups—was poorly managed, and there was no Chinese government team specifically charged with managing K-STEP’s progress on DKU, said Duke project manager Dudley Willis.
Duke committed $5.5 million toward design and construction oversight for the project in 2010. The money pays for several private American-based firms, including Gensler, Syska Hennessy Group, Thornton Tomasetti and Jones Lange Lasalle. The latter firm currently has five on-site people—up from three in earlier years. The firms identified problems but did not have the authority to effect change. Although Duke officials visited the campus every two or three months, there was no representative on the ground in China consistently through the first few years of construction.
Duke is increasing its own oversight in 2013 by sending Willis to Kunshan full time to bring some clerical organization to the project and expedite the process of sharing designs, revisions and additional information between the involved parties.
Manning noted that it would not have been prudent to send Willis or another project manager to China before now.
“Until [the Chinese are] convinced that there’s an issue, they don’t have an issue,” Manning said. “You can be there every day and giving the right answers, but they’re not responding because they don’t have the money, and they can’t manage.”
Duke’s on-site firms noticed glaring problems with construction in early 2012 and immediately informed K-STEP and Manning. When K-STEP did not resolve the concerns, Manning contacted K-STEP’s top management. As the year went on, Manning said he realized his efforts were futile and contacted Provost Peter Lange who he hoped could spur concrete change. Lange contacted Vice Mayor Jin Ming, who is in charge of higher education for Kunshan. Duke continued to move up the Kunshan government ladder with its concerns, eventually reaching one of the top officials in the city—the local communist party secretary Guan Aiguo, Manning said.
“[We essentially said] ‘We’re not going to move into the building until they are at our standards,’” Manning said. “It never got to the point that [we said], ‘We’re not going to do this deal.’”
Rectifying the situation
Once that message reached top Kunshan officials, the two parties entered into discussions about completing a campus with Duke-quality standards in a timely manner.
The city of Kunshan approved funding increases that will allow it to adhere to Duke’s construction timeline and to meet the University’s quality standards. The increase now reflects a total expenditure of approximately $260 million, the figure appropriate for a similar project in the United States, Manning said. Kunshan has also assigned a government-based management team to oversee K-STEP, which is led by Vice Mayor Jiang Hao, who was previously not involved with the project.
The Chinese construction crew will have to redo some of the already completed work, contributing to the delay, Executive Vice President Tallman Trask said. Because of the slowed construction in the past year, many projects have remained dormant and unattended, leaving them exposed to weather. K-STEP is still employing unskilled workers, but the new management is expected to speed them along.
Now that Kunshan has employed a new building crew, Trask said he is “optimistic” about the campus’ timely completion.
‘Realignment of expectations’
Amid the adjustments, it was clear there needed to be a “realignment of expectations” for when the campus will be ready to host students, said Jim Roberts, executive vice provost for finance and administration and member of the future DKU board of directors.
“There’s a number of us who have worked on it for a while who recognize that the pace is not always what it would be [in Durham],” he said. “We’ve learned to be patient but stick by our standards.”
Administrators have worked to open the lines of communication with the highest level of Kunshan leadership, Roberts said. In the beginning, Kunshan officials did not have a full understanding of what a world-class university—by Duke standards—looked like.
In August 2012, Chinese construction leaders and experts came to Durham to learn about Duke’s quality control policies by touring the campus and meeting with facilities management administrators.
“They see our point that in the long run, DKU needs to be first class,” Roberts said. “They’re much more dedicated now than they were at first.”
In retrospect, progress would have been more efficient if Duke could have partnered with a private entity—as opposed to the city of Kunshan—even though that is not a possibility in China, Manning said. If Duke had put more of its own resources into the project, the University would have more leverage to move the campus’ completion along at a faster pace, but Duke did not want to bear those costs, he noted.
“We have the best conditions that we could have hoped for, understanding that they are building this at their costs,” Manning said.
Duke is still waiting for final establishment approval from the Chinese Ministry of Education, which is necessary for DKU to offer independent degree programs and begin recruiting students to the campus.
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