Increasingly, public and private owners are seeking improved planning, design and construction methods that enable them to achieve shorter completion schedules, lower project costs and improved quality and overall satisfaction.

In response to this demand, the construction industry is revising old methods and is developing, testing and implementing new contracting methods and techniques that lower costs, speed up delivery times, lower risk and lessen disputes without sacrificing quality.

Design/Build

Over the past 10 years, design/build has realized the most rapid growth of these techniques. The popularity of design/build is due in no small part to the speed, cost savings and relationship-building capabilities that come from project specific allocation of work, risks and responsibilities to the appropriate project team member.

Research from the Construction Industry Institute (CII) indicates significant reductions in total installed project cost from teaming and partnering concepts with a communications focus, when employed early in the project, during design development. Benefits of specific programs to reduce total project cost are:

Pre-Project Planning (potential for up to) - 20% savings
Project Team Building - 7 %
Constructability Reviews - 5%
Alternative Dispute Resolution - 2%
Safety Improvement - 2%

Two recent studies that illustrate design/build benefits are the Sanvido/Konchar Study, Pennsylvania State University College of Engineering study, under sponsorship of CII, and a study from the United Kingdom's University of Reading Design/Build Forum.

Both studies compare cost, speed and quality of design/build with more traditional delivery methods. The Sanvido/Konchar Study shows design-build unit cost at least 4.5% less than CM-at-risk (delivery 23% faster), and 6% less (delivery 33% faster) than design-bid-build and equal or greater quality. The U.K. study showed a 12% improvement in construction speed, 30% in delivery speed, 13% reduction in unit cost and a greater chance of finishing within 5% of the project's original budget. Given these results, it is no surprise that the increased use of design/build is being driven by owners.

Not all public owners can use design/build due to statutory limitations. However, many of the attributes of design/build can be used in other contract delivery systems. See alternative delivery processes, below.

Other Contracting Delivery Systems

Additional contracting approaches include the following delivery systems, all of which have adopted portions of design/build techniques for speed, cost-effectiveness and/or relationship building benefits of design/build techniques:

Teaming and Partnering
At-Risk Construction Manager GC/CM (General Contractor/Construction Manager)
EPC (Engineer/Procure/Construct)
DBO (Design/Build/Operate) and
Agency Construction Manager

Implementing New Contracting Delivery Systems

Successful elements of design/build have been borrowed by other delivery methods with great results. Realizing the benefits of design/build and other alternative delivery systems requires project participants understand their new or revised techniques, project roles and responsibilities, be fully vested in project goals and must also possess the requisite communication, teamwork and conflict resolution skills. However, not everyone can make a successful transition from traditional design/bid/build to design/build.

In order to obtain the benefits of alternative contracting, the selection of delivery method must be based on careful consideration of the owner's needs and goals in conjunction with the advantages and disadvantages of each contracting method and the capabilities of the project team members.

Another area for close inspection is the project team. Design/build is most successful when owners can pre-qualify contractors. "Most qualified bidder" will soon incorporate methodology- communications, teaming and partnering skills. Team members without a proven track record in design/build projects will increasingly find it difficult to be short-listed on design/build and other projects that utilize alternative delivery methods, because the skills required for design/build are different from the traditional design/bid/build method.

Major financial and performance failures can occur when the selection of contracting methods is not carefully evaluated for appropriate use. Design professionals or contract advisors familiar with various contract methods can provide helpful insight in making this important owner decision. Other evaluative tools also exist, such as CII's Disputes Potential Index and Georgia Tech's Design/Build Selector tool.

As the cost savings and other benefits of teaming and partnering become more fully known, owners will increasingly insist on construction team members that can demonstrate successful implementation of teaming and partnering processes.

Not all construction professionals will have the skills, behaviors or knowledge required to implement these new methods. Not all will successfully adapt to these new techniques, develop the skills required for successful completion, or even see a need to do so. Team members that continue to utilize their usual "tried and true" design/bid/build approaches on design/build or other hybrids, will not be successful partners in these new delivery methods and will jeopardize the benefits that drive the selection of these new techniques.

Alternative Delivery Processes

Pre-Construction Techniques achieved at the planning and development stage of a project provide the largest benefit to improved cost, schedule and quality of performance. This well established early construction concept was lost during the 1970's and 1980's and is now re-emerging on projects focused on improving performance and results. Planning and development includes teaming and partnering and equitable contracting practices that outline, at the very least, a communications plan and dispute resolution procedures.

Teaming and partnering concepts are not new. Many construction projects are successfully completed on schedule and under budget as a result of informal partnering processes often utilized by construction superintendents and owner representatives. These informal negotiation processes, so-called "horse-trading", have promptly and equitably resolved many disputes that arise during construction.

In the 1980's, work by the U.S. Corps of Engineers and several state Departments of Transportation confirmed the increased value of formalizing a partnering process into construction projects. Recommended partnering best practices are available from the U.S. Corps of Engineers.

Project Management, for projects large and small now encompass a more holistic view than ever before. Although much attention is still on increased capture and dissemination of technical, budget and schedule information, project management best practices now include early planning that incorporates project participant needs or goals, improved contracting techniques and increased examination of team members and partners for specific skills sets. Team communications abilities and compliance with contract administration are now important project management considerations. Improvements in communications technology are also driving demands for more frequent updates of project data and demands for specific technology or software compatibility.

Change management is a familiar segment of project work, yet is frequently managed in a lackadaisical fashion. Project-end surprises are the usual result of inattention to change management, which can be extremely damaging to relationships and result in reduced recovery of costs for work performed.

Planning for and managing change will insure that change protocols are in place, and if followed, provide for examination, and pre-authorization of additional work prior to, or shortly after, performance of work begins, when the project team has the largest range of options to address the changed condition. Improved change management processes, forms and tools are now available to increase compliance with contract requirements and best practices. (See Tools).

Contract administration is a vital part of project execution and an integral part of managing risk. Frequently, the scope or technical portion of a contract is the only portion of the contract that is administered. Minding the contractual P's and Q's is an often overlooked portion of managing project relationships and reducing risk. Increasing the attention to fully executing the contract - not just the work - reduces risk by focusing parties on the project in its entirety, rather than the limited focus on completion and billing of scope of work performed.