Design-Build

Latest revision as of 10:41, 1 June 2021

Design-Build is a project delivery system, mainly used in the construction industry. The method utilizes single source responsibility which differs from the more traditional dual or triple source responsibility format used in Design-Bid-Build. The responsibility is defined by contracts, where the contract in the Design-Build project binds the architect and the contractor under one contract with the project owner. One of the key reasons for doing so is to create a shared responsibility between the architect and the contractor, and thereby involve the architect in the construction phase, and the contractor in the design phase.

Design-Build projects can be further divided into three types; Architect-led Design-Build projects, Contractor-led Design-Build projects and Joint Venture. In these cases the Design-Build entity is led either by the architect, the contractor or shared between the two parties. The different types of Design-Build affects the management structure and responsibilities in several ways.

A project delivery system such as Design-Build is essential to project management in construction projects, and especially ties into project procurement management, where a clear definition of the project delivery method is needed. The defining of a project delivery method is a critical deliverable of the procurement strategy as it is defined in the PMI standards for project management (PMBOK Guide)^[1]. The procurement strategy should define a project delivery method, the contract payment types, and the procurement phases.

Design-Build as a delivery method in construction projects enables the initiation of early on site construction, because the method facilitates overlap in the design and construction phases. Furthermore, the owner is able to minimize risks by signing just one contract to the Design-Build entity, however the owner must be willing to hand over some of the control and responsibility for design details. Technically complex projects can also benefit by integrating the contractor's expertise in the early design and development phases.

[edit] Project Management Context

Although different definitions of project delivery method exists, this article defines the term based on El Asmar, M., Hanna, A. S., & Loh, W.-Y. (2013)^[2]:

"... a system that determines the relationships between the different project stakeholders and their timing of engagement to provide a built facility."

This ties into the PMBOK Guide^[1] which defines the project delivery method as an essential element to the procurement strategy. The procurement strategy is an output of the PMBOK Guides Planning Phase with regards to procurement management. It is often based on a make-or-buy analysis (or equal method) which defines whether the owner have the abilities to deliver the project themselves, or if external parties should be hired. Depending on the project characteristics a fitting project delivery method is chosen by the owner. The choice affects the procurement management through three of the five PMBOK Process Groups (Planning, Execution, Monitor and controlling) making the selection and execution of the project delivery method critical for the overall success of the project.

[edit] Choosing the Right Project Delivery Method

Before choosing a project delivery method it is important that the owner of the project is aware of the different methods that are available, and thoroughly understand how the these define the stakeholder relationships and timing of engagement. Furthermore the owner must understand which method is the most applicable depending on project types, as well as pros and cons for each method. Some of the most commonly used methods used in construction projects are listed below^[3]. The descriptions are only of the most simple versions, and hence the delivery methods are not extensively elaborated upon in this article.

The project owner should consider several aspects before deciding which delivery method should be used. Design-Build Institute of America (DBIA) has developed a document which acts as a guide for projects owners concerning this specific decision process. The main aspects of consideration include ^[5].:

• Owner control
• Owner relationships
• Project budget
• Project schedule
• Owner risk

Link to the document can be found in the Annotated Bibliography.

[edit] Why Choose Design-Build

By assessing the above mentioned considerations related to the choice of project delivery method^[5], Design-Build may be chosen for the following reasons:

Owner control: The owner is willing to place the handling of the design details with the Design-Build entity. This is done in order to take advantage of the benefits from overlapping design and build phases. For that reason, owner should be willing to specify performance requirements instead of construction/design specifications.

Owner relationships: The owner desires and have the ability to enhance project coordination, and thus is able to create an environment and incentive to reduce claims between the involved parties. The owner must also be willing to include the contractor in the planning and design phases of the project, and be aware that this might affect the uniqueness of the design.

Project budget: The budget of the project is be possible to determine as early (in combination with the performance requirements) . This is required in order to give the Design-Build entity the best opportunities to collaboratively comply with budget and performance requirements in the design and build phases. Experience from similar projects, and thus knowledge about expected costs is an advantage.

Project schedule: It is the desire of the owner to fast-track the project, and delivering on time is prioritized.

Owner risk: The owner is not willing to risk change orders (or wants to minimize it) and the delays/costs associated with it. Furthermore, the owner must be willing and able to identify and fairly allocate risks between the involved parties.

Another important aspect which is argued by Moore, D (2000)^[6], is that the owner should not expect that there is one perfect delivery method for all projects. Moore also argues that the available project delivery methods (such as the five most common mentioned above) are only primary methods, and sub-methods are only limited to the creativity of the project team. The owner should thus investigate which sub-method of Design-Build is the most fitting for the particular project.

Some of the potential pros of Design-Build as described by Poché, C. (2019) are mentioned below^[7]. Cons of the method will be presented in the Limitations chapter.

Pros:

• One liable party: Because of single source responsibility managed by one contract, conflicts may be easier to locate and resolve. The Design-Build entity are more motivated to resolve internal conflicts, instead of pointing fingers.
• Efficiency: Also related to the single source responsibility, improving communication efficiency as there are fewer external parties involved in the project. Project time can also be reduced due to the overlapping of design and construction phase.
• Collaboration: Collaborative synergies across expertises are more likely to be harvested, improving efficiency and reducing conflicts.
• Project costs: Especially related to the reduced project time caused by initiating the building phase before the design phase is finalized. This can potentially also reduce costs by including construction expertise in the design phase to discover and discuss elements that might affect the building phase.
• Direct payment: Since the Design-Build entity keeps all payments and requests and approvals under one roof, this should be expected to perform more consistently, create fewer conflicts, and increase efficiency.

[edit] Management Structures

When describing project delivery methods in the construction sector, a few roles reappear across the different methodologies. The Design-Build methodology, like many other delivery methods, consists of owner, architect and contractor, but furthermore defines the 'role' of the Design-Build entity. This entity always consists of an architect and/or engineer as the designer, and a contractor as the builder. However the management structure of the Design-Build entity may vary, and is usually defined in one of the following ways ^[7]:

Architect-led Design-Build projects: The architect is the lead of the Design-Build entity. This is usually the case when the construction project concerns high-end residential construction, hospitals, museums and buildings alike, where aesthetics and architectural strengths are prioritized. This structure might furthermore present advantages such as the possibility to begin the design phase before delivery method is selected. However this structure might cause contractor licensing laws problem in some countries and especially in the USA^[8].

Contractor-led Design-Build projects: The contractor is the lead of the Design-Build entity. This is most common when the project is functionality based, such as infrastructure and industrial factories. Here the strengths of the contractor are prioritized. An advantage to this structure is that contractors are usually more experienced in managing both construction and design compared to design companies. However, a disadvantage for the contractor is the added risk in being responsible for potential design errors^[8].

Joint venture: The contractor and the a design company (architect/engineer) establishes a company specifically for the project, sharing risks, management, costs and profits. From the owners point of view, this gives an advantage of more direct contact and control with both the designer and the builder. Further more the structure increases the incentive for the two parties to collaborate in the delivery of the project. This might however also introduce a risk to the two parties who are responsible for each others errors^[8].

The management structures of Design-Build projects are not limited to the above mentioned, and especially contractor-led and architect-led models can vary a lot with regards to responsibility and contracts with sub-contractors and sub-consultants. Regardless of structure, DBIA recommends the Design-Build entity to define this structure as early as possible and in a way which encourages collaboration and open communication^[9].

[edit] Implementing and Succeeding with Design-Build

The following suggestions for implementing and succeeding with Design-Build projects is largely based on the publication "Design-Build Done Right - Best Design-Build Practices" created by the Design-Build Institute of America (DBIA) ^[10]. The publication acts as a guide for Design-Build projects from procurement through contracting and at last the execution and delivery of the project. The guidelines are created to suit most Design-Build projects, and are thus formulated generically. The guidelines for DBIA are further more supported by Design-Build practices from additional sources highlighted in the text.

[edit] Procurement

Prior to executing the procurement, the owner should thoroughly investigate wether Design-Build is suited for the project, as well as how well it fits the owners organization. If the owner fails to do so, the potential benefits of using Design-Build will not be realized. Some of the key considerations can be found in the section "Choosing the right project delivery method". When the owner, organization and relevant stakeholders are committed to Design-Build as project delivery method, the procurement process can commence.

The procurement route of a Design-Build project will vary from project to project, depending on management structure as well as the specific project. The following illustrates a generic example of steps required by the owner in the Design-Build procurement process. The steps are based on material from LORMAN ^[11].

1. Strategic Facility Planning: Analysis of facility requirements to establish facility development plan.
2. Program Definition: Establishment of project requirements. This might include definitions of facility dimensions, performance requirements, standards that must be followed etc.
3. Request for Qualifications (RFQ): The defining of the qualifications needed by the Design-Build entity to execute the project. This can be anything from skill and experience to price and quality.
4. Qualifications Statement: The advertising of the developed RQF to several Design-Build firms who then replies with qualification statements. The owner now chooses a few firms (normally three to five) who fulfill the RQF the best.
5. Request for Proposals (RFP): The owner now communicate the requirements for the project to the selected firms. This is sent in the format of an RPF which contains e.g. design criteria, contract requirements and other information needed in order for the Design-Build firms to reply with a proposal which fits the requirements.
6. Pre-Proposal Conference: Optional meeting where the chosen firms can ask further questions regarding the project, before submitting their proposal to the owner.
7. Proposal Submission and Evaluation: Evaluation of the submitted proposals. This is based on predetermined factors e.g. price or design, but usually a combination og several. This step is critical for the owner, since it will determine the ultimate outcome of the project.
8. Contract Award: Contracts between owner and the chosen Design-Build entity are formulated and signed.
9. Documents/Construction: Design and construction phases are initiated and overlap as specified.

The guidelines from DBIA^[10] argues the procurement process should be based on the particulars and circumstances of the specific project, and then strategize how to use Design-Build to take advantage of these. The DBIA guidelines furthermore introduces several implementing techniques on:

1. How to assess the nature of the project before deciding on Design-Build. These applies mainly to step 1 and 2 presented by LORMAN above.
2. How to implement a procurement plan which facilitates the potential benefits of Design-Build, as well as reflecting the owners reasons for choosing the method. These applies to step 1-5 presented by LORMAN, especially step 3 and 5 concerning RFQ and RFP.
3. How to make the evaluation and selection processes reflect the best practices of Design-Build, including transparency and fair requirements/specifications. These applies to step 6-9 presented by LORMAN, especially step 6 and 7.

[edit] Contracting

When formulating the contracts for a Design-Build project, DBIA promotes fair, clear and balanced contracts promoting collaboration among the participants. This is of course applicable to most contracts, but collaboration should especially be highlighted in Design-Build contracts, since the project phases of design and build are intended to overlap and benefit from this. It is further more important that the owner not only addresses the nature of the contract between owner and Design-Builder, but also the contracts between Design-Builder and other involved parties. DBIA defines implementation techniques in the mentioned guidelines^[10] and recommends:

1. Contracts between owner and Design-Build entity should reflect Design-Build values
2. Contracts between Design-Build entity and the team members, sub-consultants and sub-contractors, should reflect Design-Build values

The Design-Build values as well as the reasons for choosing Design-Build as delivery method should be imbedded in the procurement management, and thus also into the contracts between all parties in order for the project to benefit from the methodology.

Free examples of Design-Build contracts can be downloaded at consensusdocs.org ^[12].

[edit] Execution and Delivery

The following best practices from the DBIA guidelines^[10] focusses only on the practices unique to succeeding with Design-build execution and delivery. The owner should be familiar with generic best practices in execution and delivery of construction projects since many are shared between the different project delivery methods available.

1. All members of the Design-Build entity should be educated in the methodology and be aware of main differences from other delivery methods.
2. The project participants should be able to work under the same roof as much as possible to ensure collaboration.
3. The project team including owner, main stakeholders and key members of the Design-Build entity should establish processes to facilitate collaboration and communication throughout the project.
4. Focus from the project team on aligning the execution of processes across design and commissioning/turnover, in order to ensure transparency and quick decision making if necessary.

Elaborations on specific implementing techniques can be found in the guidelines^[10] which are also linked in the Annotated Bibliography. Several construction management tools, methods and theories can be found on the APPPM wiki, which supports the execution and delivery of construction projects. A few are listed below:

• Lean construction

• Critical Path Method in Construction Industry

• VDC as a project management tool on construction projects

• BIM as a project management tool on construction projects

[edit] Limitations

As mentioned throughout the article, Design-Build is not suited for all project types, and the owner does not automatically benefit from all the potential pros of the methodology if the project is not thoroughly assessed. The limitations and potential cons of the methodology will vary depending on the choices made throughout the implementation of the delivery method, especially the choice of management structure and contractual relationship, as described in the Management Structure chapter. Below the reader is presented to some potential cons of choosing Design-Build.

[edit] Cons of Design-Build

Some of the potential cons of Design-Build as described by Poché, C. (2019)^[7].

Cons:

• Conflicts of interest: Depending on the contract, conflicts of interest might arise e.g. between the owner and the contractor. The owner might in interested in the highest possible quality, whereas the contractor wants to reduce the costs. This risk can be reduced by establishing a budget which is realistic in concern to the interest of the involved parties.
• Less innovative design: By including contractors in the design phase, it must be expected that the contractor is more interested in working with methods and designs known to be the most efficient. This might influence the designers, as well as the owner who might aspire for the project to be innovative.
• Requires more engagement from the owner: The owner must be careful, and hold significantly more responsibility, when signing the Design-Build contract, and ensure that the entity has the skill and ability to deliver the project.
• No bidding restricts access for subs: Sub-contractors might have a harder time getting work since the bidding phase does not exist in Design-Build. The subcontractors are often chosen based on experience or different preselected parameter.
• Increased liability: The contractor og the architect, depending on the contract, might be liable to more parts of the project than usual.

[edit] Annotated Bibliography

• Project Management Institute, Inc.. (2017). Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition). Project Management Institute, Inc. (PMI), pp. 459-501 Book providing best practices and standards for project management. The given pages refers to chapter 12 "Project Procurement Management" including the choice of project delivery system. This chapter is essential to understand the impact of project delivery method choice on procurement management.

• Moore, D. (2000). Selecting the best project delivery system. Paper presented at Project Management Institute Annual Seminars & Symposium, Houston, TX. Newtown Square, PA: Project Management Institute. Retrieved 21 February 2021, from https://www.pmi.org/learning/library/selecting-best-project-delivery-system-8910 Article which critically reviews common project delivery methods and presents key project delivery system principles, and key areas of consideration for project delivery system selection. This article is chosen because of its objective viewpoint (published by PMI) compared to the following two documents published by the Design-Build Institute of America.

• Design-Build Institute of America. (2015). Desig-Build Done Right - Primer [pdf]. Retrieved from https://dbia.org/wp-content/uploads/2018/05/Primers-Choosing-Delivery-Method.pdf Document from the Design-Build Institute of America containing owner considerations prior to deciding on project delivery method. The document highlights which parts of the project will be affected when deciding on a specific delivery method, as well as a brief walkthrough of the most commonly used methodologies and the key considerations associated with each.

• Design-Build Institute of America. (2014). Design-Build Done Right - Best Design-Build Practices [pdf] (2nd ed.). Retrieved from https://dbia.org/wp-content/uploads/2018/04/Best-Practices-Universally-Applicable.pdf Document developed by the Design-Build Institute of America containing containing best practices for procurement, contracting and delivery of Design-Build projects. For each best practice, a series of implementing techniques are also described. The document is not focused on any specific sector nor project type, but highlights best practices and implementing techniques of generic nature essential to succeed with the Design-Build methodology.

[edit] References

1. ↑ ^{1.0 1.1} "Project Management Institute, Inc.. (2017). Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition). Project Management Institute, Inc. (PMI), pp. 459-501"
2. ↑ El Asmar, M., Hanna, A. S., & Loh, W.-Y. (2013). Quantifying Performance for the Integrated Project Delivery System as Compared to Established Delivery Systems. Journal of Construction Engineering & Management, 139(11), 1. https://doi-org.proxy.findit.dtu.dk/10.1061/(ASCE)CO.1943-7862.0000744
3. ↑ Ellis, G. (2020). The Ultimate Guide to Choosing the Best Project Delivery Method. Retrieved 21 February 2021, from https://constructionblog.autodesk.com/best-project-delivery-method/
4. ↑ The American Institute of Architects. (2007). Integrated Project Delivery: A Guide [pdf] (1st ed.). Retrieved from https://help.aiacontracts.org/public/wp-content/uploads/2020/03/IPD_Guide.pdf
5. ↑ ^{5.0 5.1} "Design-Build Institute of America. (2015). Desig-Build Done Right - Primer [pdf]. Retrieved from https://dbia.org/wp-content/uploads/2018/05/Primers-Choosing-Delivery-Method.pdf"
6. ↑ Moore, D. (2000). Selecting the best project delivery system. Paper presented at Project Management Institute Annual Seminars & Symposium, Houston, TX. Newtown Square, PA: Project Management Institute. Retrieved 21 February 2021, from https://www.pmi.org/learning/library/selecting-best-project-delivery-system-8910
7. ↑ ^{7.0 7.1 7.2} "Poché, C. (2019). Understanding Design-Build Construction | Project Delivery Methods. Retrieved 21 February 2021, from https://www.levelset.com/blog/design-build/"
8. ↑ ^{8.0 8.1 8.2} "Possible Design-Build Team Structures | Lorman Education Services. (2005). Retrieved 21 February 2021, from https://www.lorman.com/resources/possible-design-build-team-structures-15853"
9. ↑ Design-Build Institute of America. (2010). DBIA Position Statement - Organization of the Design-Build Entity [pdf] (1st ed.). Retrieved from https://dbia.org/wp-content/uploads/2018/05/DBIA-Position-Statement-Organization-Design-Build-Team.pdf
10. ↑ ^{10.0 10.1 10.2 10.3 10.4} "Design-Build Institute of America. (2014). Design-Build Done Right - Best Design-Build Practices [pdf] (2nd ed.). Retrieved from https://dbia.org/wp-content/uploads/2018/04/Best-Practices-Universally-Applicable.pdf"
11. ↑ Design-Build Procurement Process | Lorman Education Services. (2005). Retrieved 21 February 2021, from https://www.lorman.com/resources/design-build-procurement-process-15875
12. ↑ Design Build Contract Agreements - ConsensusDocs. Retrieved 21 February 2021, from https://www.consensusdocs.org/contract_category/designbuild/