How can the construction industry improve project outcomes by learning from the manufacturing sector? This week on the Work Done Right podcast, Gene Hodge, Mortenson’s VP of Innovation, joins to discuss the benefits of modular construction. Gene explains how Mortenson’s strategy, involving the pre-fabrication of construction components in a controlled environment, leads to waste reduction, enhanced quality, and the creation of safer and more predictable workspaces.
Gene also dives into Mortenson’s niche expertise in sports stadium construction, highlighting their prowess in tackling architecturally complex projects, fostering community engagement through sports infrastructure, and their dedication to diversity and workforce development. Don’t miss this fascinating episode on how stakeholders can move beyond zero-sum thinking and work together to achieve win-win solutions for everyone involved.
Our guest today is Gene Hodge. Gene leads Mortenson’s innovation team, supporting Company and industry growth in industrialization, automation, technology, manufacturing and other methodologies. Holding a strong belief that we cannot transform our industry in silos, Gene is also an active collaborator with all types of industry partners. Gene has spent his entire career with Mortenson and holds a Bachelor of Science in Construction Management from the University of Washington.
Gene and his family live in Minneapolis, Minnesota where they fully embrace all four seasons. When not in Minnesota, they can likely be found skiing in Colorado.
Top 3 Episode Takeaways
Modularization and Innovation in Construction: Gene Hodge discusses Mortenson’s innovative approach to construction, emphasizing the benefits of modularization. This approach involves pre-fabricating components in a controlled environment, reducing waste, improving quality, and creating more predictable and safer workspaces.
Expertise in Sports Stadium Construction: Gene Hodge discusses Mortenson’s specialization in sports stadium and complex construction. He highlights their ability to tackle architecturally challenging projects, like building stadiums with unique designs, emphasizing the community-building aspect of sports construction, and the focus on diversity and workforce development within this field.
A Shift Towards Win-Win Solutions: Hodge emphasizes the need for a shift in mindset within the construction industry, moving away from the belief that one party’s success necessitates another’s failure. He encourages a more collaborative approach, where all stakeholders work together to achieve successful outcomes, improve project delivery, and create a more enjoyable construction process for everyone involved.
Gene, welcome to the show. Thank you for joining us here at our Built World America’s Summit recordings that we’re doing here, live and in person.
I just wanted to start this off by just kind of getting to know a little bit more about you, how you got into construction, and really kind of your career so far in the industry.
Yeah, sure. I’m happy to share that.
So I think I’ve wanted to be in construction a long time since I was a kid. My grandfather was a, who I’m named after was a crane operator. He actually died on the job. And so I had kind of a value of safety ingrained in me really early on.
When I was a kid, I built a lot of little projects with my dad around the house and then I worked some construction jobs and high school and into college. And I actually started with Mortenson as an intern when I was 18 years old, my freshman year of college.
So I’ve been at it for a bit.
No kidding. Yeah, so you’ve been with Mortenson for 20 years now. Yeah, atypical from what I’ve seen in my experience. Not a lot of people stay with the same company for really the whole of their career.
What are some of the roles that you’ve held along the way? What is it about Mortenson that maybe the culture of that, their investment into you, what is it that has kept you with them striving to do more and more every year?
Yeah. Mortenson is an amazing company. I’ve really enjoyed it. I’ve worked, I think I’ve worked in every time zone in the continental 48. I’ve worked in Washington, Minnesota, Pennsylvania, New York, Colorado, Montana, Utah, kind of all over the map.
We have a very diverse business. We build stadiums, we build renewable energy, we’ll build schools, hospitals. I think the wide variety allows you to do a lot of different stuff with your career. I’ve been able to, I’ve run projects, I’ve done business development, I’ve run operating groups, and currently I’m leading up innovation for the company, which is really fun because I get exposed to our people all across the company, all across the country working in all kinds of different roles. It’s really satisfying. The company is about $5 billion a year in current revenue. We’re growing rapidly. We’re privately held, which I think is a big part of our culture.
So we don’t have outside drivers. We don’t have shareholders to answer to. Our ownership entity, the Mortenson family, has always had this focus on growing retained earnings and putting the money back into the firm and continuing to invest.
So it’s been fun and rewarding.
Yeah. So you had said before that Mortenson does a lot of different kinds of projects. Yeah. A lot that they do. And something I didn’t know is that they actually have quite the prowess in sports stadium construction.
Can you tell us a bit about some of these kind of bigger named projects that Mortenson has done over the years?
Sure. I spent quite a bit of time working in the sports business actually. And I built a hospital once and I thought that was absolutely the most complicated thing you could build until I built a sports job.
And you know, normal buildings work in two axes. So usually you have square corners. You’re working everything’s rectilinear. It’s straightforward. If you look at any stadium, they’re not that way. I think about we built the Raiders Stadium in Vegas and that building is round.
It’s curved. It’s every single piece of glass on the outside of it is a different size. And so we built some amazing things, the Viking Stadium, the Raiders. We were recently selected with our partner McCarthy to build the athletics new facility in Las Vegas.
A lot of fun and exciting stuff in sports. And I think the thing that’s really exciting about sports construction is it brings entire communities together. There’s a huge focus on small minority diverse businesses.
There’s a huge focus on growing a workforce. And it’s a massive effort and undertaking and very rewarding in that regard.
Yeah, I bet it is. I guess I’ve never really thought about how it would be building a large round building.
You say that, you know, how is it that you guys are going out there? Are you having to basically shoot in and survey every single building going on around? Yeah, there’s a lot more technology involved and there’s a lot more I think quality and focus on manufacturing because everything’s got to fit together absolutely just right.
Right well you teed that up to segue into this pretty well I don’t know if you put it in. I think that was accidental but I’ll take it let’s go with it. So so with that I mean Mortenson has a different way of building and honestly it sounds like a different way of approaching innovations and a different way of approaching construction in general so could you walk us through a Mortenson has?
Yeah I would say when a lot of people think about innovation they focus on technology first and we think technology is part of the solution. I think getting developing 3d models that are detailed enough where you can develop cost estimates, build materials off of them, actually order and engage your supply chain is a big deal but ultimately buildings are physical things that are put together and so while technology is a big focus I’d say a larger focus for us is how can we standardize on assemblies on components?
How can we modularize construction so that the final construction site, we’re not cutting, making and creating things. We’re just assembling, you know, kits of parts and sub assemblies that are pre -manufactured, increases quality, speeds things up, and delivers things at a lower overall cost.
I think about we’ve done a lot of projects with a really innovative hotel firm called CitizenM. And so they’re really focused on containerized buildings. And so you’ve got two rooms that come together with a hallway in between.
Those rooms are fully finished with a bed in it, with toilet paper hanging on the wall. When you set it, as soon as the rest of the building is done, you’re ready to go. And those are the kind of things that we think are really exciting.
Yeah. How is it? And I’ve talked to a couple of other folks that have a similar, we’ll say modular philosophy, but they’re very standardized. It is this kit of parts, it is what it is that you’re wanting.
This is just our structural frame and we’ll move from there. But with something like a football stadium or, we’ll say, one of these other architectural marvels. Yeah. How do you do that? Exactly. So how do you guys approach that in working toward modularization with something like a football stadium?
Yeah. So I would say you can’t solve all of it that way, right? So we focus on the areas that are most cost dense. So if there’s a lot of mechanical, a lot of plumbing, a lot of electrical where you have a lot of cost and work where people would otherwise be soldering, welding, fitting up, there’s a lot of on -site labor, anything like that.
So you take, look at elevator shafts, look at mechanical shafts, look at electrical rooms, and it might not even be the whole room. It might be taking all the panels and switch gear on one wall and how do you pre -wire, pre -manufacture all of that.
And so you’re just dropping it in place and clicking it in. And I think there’s a lot of inaccurate perceptions and beliefs around modular. People think about residential trailers and things like that.
And think about low quality. And we’re really focused on that doing the work in the field is challenging. It’s difficult to achieve quality standards. If you’re doing it where you’re building stuff at a bench height, where you’re standing, you’re not crouching, you’re not getting up a lot, the quality is going to be better.
And so we look at areas like that. We also look at what people will accept. And so people generally want what they see and experience in a building. They want to feel custom. They want to feel bespoke.
And so if we can focus on the areas that are invisible, what’s in the wall, what’s in the ceiling above it, and really focus on those, we see a lot more success happening.
Yeah, that makes sense. And really this, you’re not taking a one size fits all approach whenever you’re taking a risk-based approach.
Like, hey, we’re going to get the most value out of doing this. Where is it most feasible to do this? And let’s make sure that we’re saving our costs effectively where we can in the most logical and pragmatic way.
Very intelligent way of moving forward doing that. But we’ve had plenty of failures on the way. Yeah. So with that, though, some of these, I guess, hard lessons that you’ve learned over the years, what is it that you’ve found you’re really not able to do in a modular way?
And where have you had some of those failures?
Yeah. So yeah, so I’d say in the example of fully prefabricated hotel rooms, those hotel rooms have drywall. They have finishes, and they do not have a roof on them yet.
And so we’ve learned a lot about how do you keep the things that are finished when you’re doing it in a completely different sequence? How do you keep them dry? And we’ve removed plenty of drywall learning, learning how to deal with that.
And so I’d say we’re really big on celebrating and embracing and appreciating failure and taking lessons out of it. I think it’s really easy to fail at something and say, oh, god, I don’t want to do that again.
But usually there are some things that actually succeeded in there, and then some other switches you can flip to turn it from a failure into success. So that’s a lot from a process standpoint. It’s hard to say one blanket thing that fits everything, but I think that mindset is really important to make progress.
Yeah, definitely. I mean, if you think of any of the anecdotal stories about out there with Thomas Edison, he says in learning how to make a light bulb or inventing the light bulb, there are 999 ways of not making a light bulb.
So in order to do anything that’s new and innovative, you run the risk of some level of failure, it’s great that you all have that culture of accepting failure likely within reason.
So what are some of the other benefits that you’re saying that you’re seeing out of taking this modular semi -manufacturing approach? You talked a little bit about the benefits of quality of having this in a controlled environment.
What else are you seeing?
So another part is the workforce. And so our construction sites, you think about mud and rocks and ladders and lifts and big pieces of. equipment and there’s a large portion of the population that physically is unable to engage in that scope of work.
And when you move things into a factory, it opens up for a whole new level of workforce and ability to develop into a skilled trade that somebody might not have had when you look at the limitations on a construction site.
And so that’s huge. I think from a supply chain mitigation standpoint, our ability to partner with folks and stand up our own factories where we’re controlling all the parts and pieces that are coming in there and we can be a lot more responsive and dynamic as the world around us changes.
That’s another key benefit.
How are you seeing that, talking about with the band power especially, how are you seeing it with you know, if you’re manufacturing 60% or even 40% of the facility, how does that impact the demand for really these workers in order to travel from location to location to location?
For 10, 15 years, that’s something that I did moving from project to project. project and I will say that it’s not always a sustainable lifestyle and it’s not a lifestyle that a lot of people can live a full life doing.
I’ve seen many, you know, sorrowfully I’ve seen a lot of marriages fail and stuff like that with people just being out on the road. So are you seeing also by doing this, taking this approach of, you know, manufacturing these modules that you can eliminate a lot of the need for traveling employees?
You know, is that helping to cut down on per diem and wages and all of that as well?
Yeah, we’re, I would say we’re hoping that will reduce the demand for that. We haven’t, it hasn’t made enough of an impact on our business or the construction business as a whole yet to really say that’s, you know, we’ve cut 30% of the travel or something like that.
I think we’re still very early on, but that absolutely is the hope and also the flattening out of the hours. You know, a lot of those folks at periods of time are forced to work 50, 60, 70 hours a week and that can literally be back-breaking.
And so from a safety standpoint, from a health standpoint, all of that, we’re looking to make an impact there and really flatten out that curve and provide more predictable jobs for people. I’d say, you know, being a Minnesota resident working outside in December, January, when the winds whipping and it’s negative 10, that’s pretty tough.
If you tell someone, would you like to do a similar job that doesn’t require climbing on a ladder, getting a lift and oh, by the way, it’s going to be 70 degrees and it’s indoors? That’s pretty easy to find that attractive.
Having worked in North Dakota in the wintertime, miserable. Yeah. I shall never do that again on night shift at that. And really being able to control the workspace in general.
So there are improvements with the safety, the cost, the quality?
And just generally speaking, you’re able to, again, just kind of control that environment. Are you also seeing more consistency in project delivery along a schedule since you’re able to control certain aspects of this?
And how is the, I guess, the handling of these modules from location to location, how is that impacting on?
Yeah, I think there’s definitely a risk mitigation part of it. And we really focused on flow scheduling.
And so you’re really looking at like, how do you have a consistent tack time as you move from phase to phase and area to area and having modularized components that are standard, that are exactly what to expect is a big deal.
I think about, I walk a lot of our project sites and a lot of them are consolidating multiple trades that would be above the ceiling, snaking in all directions and getting them into one rack, one assembly, and you look at the predictability of that versus you’ve got plumbers and pipe fitters and electricians running all over the place in the…
In the ceiling, it’s a dramatic difference. I think another area that I didn’t touch on is really the waste reduction and sustainability aspect. So when you think about just framing a metal stud wall, typically someone’s buying, let’s say the wall is 10 feet tall or 10 foot 6 tall, they’re buying 12 foot studs, they’re cutting every single one of those.
20% of that material is getting thrown away in a dumpster. Hopefully it’s being recycled, but there is work that went in to make that, to take it up to the place, to cut it. There’s hazards with that.
They’re throwing it in a dumpster. Someone’s got to take it down. With our manufacturing process, we’re rolling studs in this example directly off of a coil. And so you basically have taken something that was a 20% to 30% waste to effectively zero.
And what you’re talking about doing from an environmental standpoint, and a safety standpoint is huge there. So I’m pretty passionate about that part. Yeah, absolutely. Sounds like there’s a lot of opportunity there for where you can do some form of modularization and take benefits in this manufacturing side.
For sure. And it doesn’t have to be fully volumetric. I think people get stuck on this. Do I really need to ship something that’s 10 feet wide, 15 feet tall, 50 foot long, down a road? And there’s a solution where you can ship that whole thing in a flat pack.
So you’ve got the walls, floor, ceiling, and they’re stacked on each other. So you balance the efficiency of shipping with the amount of work that’s done on site. There’s a lot of different ways to address the opportunity.
Yeah, that’s a really interesting thought with that as well. Because you’re right, I think that most people will think of this as it’s framed. It’s effectively a shipping container going down the road.
And we’re going to haul all of these boxes one by one by trailers. And generally, we think it’s not that. It definitely could be, I think, areas where you have a really high labor premium, maybe where you’re working in a mountain region where there’s a short window of time.
There are other levers to pull on. But in a typical metropolitan urban environment, we think it’s more sub -assemblies and less fully volumetric. That’s a great distinction and point to put out there.
I was thinking about this still even as a container. So a big part of what it sounds like, the focus for innovations with Mortenson is this idea of modularization kind of bridging the gap between construction and manufacturing.
What else are you looking at whenever it comes to innovations? It’s a big part of your role now. What are you looking at as far as where technology can help out? And what are you looking at as far as maybe in a process and procedure way?
Yeah, I would say I perceive one of the biggest issues in construction around improvements and innovation is dealing with the fragmentation of the industry. So you work on one project with maybe 40 different trade partners and architect and engineer and owner and nobody’s invested in the long -term success and how do we work together because you’re going to do this one project, it’s one all -out, it’s bespoke.
And you’re gonna go poof in your opposite directions. And so why invest? And so any, from a technology standpoint, anything that allows us to break down those barriers to get more visibility into how are people performing?
What are the issues they’re facing? How could I help them with that? Anything that helps with really collaboration and transparency, those are the areas where we see tremendous opportunity for technology.
And I think we’ve found there are owners and there are trade partners and there are designers that are more collaborative and would like to work together for multiple years and figure out how to get better together.
And so we’re really leaning into what those folks see value in as well.
Are there any particular stories that you could share about maybe a technology that was a success in bridging some of these gaps?
Yeah, I would say a company called Joined. So it allows us to, it’s a very collaborative pre -construction software. And so it allows sharing value engineering, it’s total transparency around budget, the owner, architect, contractor, trade partners, everybody that’s at the table from more of an integrated project delivery standpoint has full view and visibility to the budget and choices that are being made and how that’s impacting things.
We’ve seen a lot of success there. We’ve also worked on, I’d say, we consider change order to be a dirty word. In the industry, we don’t like change orders, they’re disruptive, but they happen. Things happen, you have trade partner damage is something, owner change is something.
There are impacts to those. And so we’ve been piloting some technology that allows for much better visibility and transparency to what are the risks, what happening, are they being addressed on time?
And that’s both for our benefit, it helps the owner with transparency. And we look at our trade partners and they are very heavy from a craft workforce standpoint. And so they’re getting paid a month or two months after they’re paying their team members that are doing the work in the field.
And so really from a cash flow standpoint, anything that we can do to get transparency there, get them paid so they can stay whole and have a successful… business is a big deal too. So those would be a couple areas.
Yeah and so with that you’re looking at opportunities or you’ve discovered opportunities to be able to you know make this process more transparent where you can you can effectively maybe shorten the duration between the approval process of that, get the get the check cut and all of that as well.
Yeah. Yeah my uh so my background is is heavy industrial. My brother is now I had I’d gotten him into heavy industrial as well. He’s now working with a commercial contracting company where he’s a project manager and that’s actually one of the areas on the project where he is where he’s seeing a lot of a lot of difficulties a lot of changes keep getting thrown out.
The approval process is is tremendously long between you know when when they submit a change order and when it’s a state job whenever the state or the state representative architect can approve it that this is the change they’re going to make it it’s disastrous for them right now.
And I would guess that nobody involved with that process is enjoying it or having any fun.
Exactly. Exactly. It should be fun. We’re building incredible things that are going to be used for generations.
You know, 30, 50, we’ve built some buildings that are designed to be 100 -year buildings, and we should have fun and feel rewarded for doing it. So anywhere we can cut out any of that kind of stuff, we’re really working on that.
Yeah. I mean, I’d love to, if anything, talk with you more about that after this to see what I can share to him. And maybe we can improve everybody’s process. That’d be great. That’s the value in doing something like this, is sharing knowledge and information from different resources all across the industry to where we can make everybody do a little bit better, right?
Yeah. Enjoy the build process a little bit more. I totally agree with that. And I think there are multiple schools of thought. You probably know where mine is. But I think there are people that feel construction is a zero -sum game.
So for the owner to win, the contractor needs to lose. Or for the contractor to win, the subcontractor needs to lose. And I don’t look at it that way. I think there’s opportunity for, there’s certainly opportunity for everybody to lose and what we were just talking about, there should be opportunities for everybody to win as well.
Yeah. No, I couldn’t agree more. I have worked in my career for subcontractor, GC, owner, and now a technology provider. So seeing this from a whole bunch of different angles, I get floored by the people that do think that in order for me to win, I must lose.
And that’s, as you’re saying, there needs to be ownership through the process for everybody because we all need to better understand that we all have skin in this game. That if I win, you win. If you win, I win.
We’re in this together. So are there any other areas where you’re seeing potential improvements around really that level of collaboration? How do you approach that? I mean, whatever you were on project, how did you approach that situation?
Yeah. So really engaging the stakeholders. So I think about the first project I was a project manager on was a hospital. It was really complicated. vertical expansion of an existing hospital. We were building, building directly next to a neonatal intensive care unit that we had to keep safe.
And our drywall or started stocking drywall on the floors. And my mechanical contractor came to me and he said, Gene, there is no way I’m going to be able to be successful working around all this drywall.
What are you stocking up there? We got to figure this out. I looked at it and go, you know what? He’s right. And I’m a brand new project manager and I don’t entirely know what I’m doing. And so I didn’t have the solution to him.
But I said, let’s pull you in. Let’s pull the plumber. Let’s pull the electrician. Let’s pull the drywaller and let’s build a schedule that works for all of us and work out a materials management plan that works for all of us.
And we did that and thankfully ended up finishing that project about 10 weeks ahead of schedule with everybody, everybody winning. And so I think just having some humility, listening to your partners there at the table, treating them as partners and not subcontractors, that’s, I think that’s critical to being successful.
Yeah. Yeah. Yeah, now that’s, that’s That’s the great story there and great point in order to nail home for a lot of people because I don’t think that a lot of people take that same perspective, at least from what I’ve seen a lot of people.
Again, they seem to think that this is you against me and that we’re not, we’re not, we don’t have a shared goal or something. And I think that there’s a lot of, there’s a lot of perception of people in the industry of, well, I have to be this way because I know they’re saying these same things about me.
And then you go talk to the other person and they say, well, I have to be this way because they’re like, well, actually, no, that’s actually not true, right? We’re, they’re, so, you know, being, being an advocate and just being a voice for that and driving that for the rest of the industry is important.
So I’m glad to hear there are more folks out there. Yeah. o
Rapid Fire Questions
Gene, we’re coming right up on time. So I’m going to ask a few little last minute rapid fire questions to get to know. Gene, what is your idea of a perfect vacation?
I’d say a blend of excitement and relaxation. So I don’t want to sit on a beach all the entire vacation, but I also don’t want to be traipsing around feeling like I need a vacation at the end of my vacation.
So some combo there. There’s a sweet spot. I don’t think I found it yet.
Is there a particular location that you’d like to go?
We love the Caribbean. We’re actually going to Costa Rica in a few weeks for our first time.
So I’m, we might find the balance there. We’ll see.
Awesome. Yeah. Hope you have a great time.
What is your favorite quote?
Oh, I think I can. Thomas the train. Yeah. I think eventually it’s, I know I can, but you got to start with, I think I can.
Yeah. Love it. What’s your, what’s your favorite book?
Anything by Carl Hyacin. He’s the author out of Florida. He’s written 20 something books. He is, they’re all, they’re all wacky, zany, hilarious things happening in the state of Florida.
He was a writer for the, I think the Miami Herald for like 25. years and most of them are based on actual events. It’s pretty comical. So it’s like a floor -to -man book. Yeah, it’s trust. I would try it.
I’ve read them all.
Yeah, I’ll have to look that up. That’s awesome. If you were to give any bit, just one piece of advice to anybody starting off in their career, what would it be?
Yeah, it’s great.
And if you could have dinner with any one famous person living or dead, who would it be?
That would be tough. I’d probably go with Robin Williams. Yeah, that was a sad day when he died.