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In increasing numbers, public and private owners
are seeking alternatives to the traditional approach to project delivery. The
traditional approach provides for the owner to select and contract for design
services. There is a separate contract for construction services. While allowing
the design professional to maintain independent professional judgment, the
traditional approach, nonetheless, includes a separate contract for design
services.
What is driving this search for alternative
project delivery systems? Quite simply, project owners are seeking more
cost-effective solutions, higher quality products and services, shorter project
schedules, and fewer legal entanglements on their projects. Project owners also
want design firms that give more attention to project constructability. Various
methods have been developed in recent years to assist in team building and risk
sharing to ease delivery of projects. The most popular alternatives to
traditional project systems are outlined below.
Design-Build Delivery Systems
In a Design-Build delivery system, the owner
retains a single entity that provides both the design and construction services
for the project. The Design-Build Contractor becomes the single point of
responsibility for the project. The Design-Build contractor is a vendor to the
owner. The subcontractors to the Design-Build contractor are in the same vendor
relationship with the owner. Theoretically, Design-Build provides for lower
total project costs based on more rapid delivery time and the ability of the
architect/engineer (A/E) and contractor to work towards containing costs.
Design-Build can foster innovative design solutions as the A/E and contractor
pursue a common goal within the design-build process. Value engineering is an
implicit part of the process.
A thorough project description is needed before
selecting a Design-Build contractor. The project description must include
performance specifications in the scope of work package, particularly for
projects involving building or systems construction. Considerable effort and
expense goes into producing a Design-Build Request for Proposal (RFP) package.
Inherently however, there are differences in cultures between engineering firms
and contractors which could result in problems in delivery of the project.
A major disadvantage to Design-Build is that only
certain types of projects are suited for Design-Build. Ideal building projects
are those that can be well defined by the user organization during the bidding
and negotiations stage. However, Design-Build should not be used to obtain
low-cost professional design services nor should it be used to limit the
involvement of design professionals. Numerous public and private owners have
found that quality design services and adequate workscopes lead to significantly
lower construction and life-cycle costs. Projects such as full-services
remediation do not work well as Design-Build. These projects have workscopes
which include investigations and studies to define the extent of contamination
and are therefore difficult to bid and execute as Design-Build.
Federal government agencies increasingly use
Design-Build delivery systems. The General Services Administration (GSA), U.S.
Postal Service (USPS), and the State Department are making significant use of
Design-Build as a project delivery system. At the USPS, Design-Build delivery
systems accounted for 19 percent of procurement in 1992. The Environmental
Protection Agency (EPA) contracts nearly all of its work using nontraditional
project delivery systems.
Construction Management
Construction management (CM) is defined as
maximizing an owner's capital investment through the coordinated efforts of the
designer, owner, and construction contractors working together to preserve and
enhance the quality of the project, control construction costs and time, and to
reduce long-term operating and maintenance costs. The construction management
program objectives are achieved by exercising good management practices.
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Selecting a construction manager's services is done using a qualifications-based
selection (QBS) approach just as one would select a design professional for
conceptual and detailed services. This selection method helps provide a good
match between the owner's needs and the CM's capabilities, skills, and
experience. Construction Management is useful particularly when the owner does
not have experience with construction and wants to hire an expert to represent
the owner's interest. The CM can bring the entire project team together during
the design phase to develop the most cost-efficient project meeting the client's
needs. One disadvantage to CM as a project delivery system is final costs are
not guaranteed unless the CM agrees to a guaranteed maximum price after the
schematic design documents are available. As the owner assumes the
responsibility of selecting the CM, the project can suffer if the owner selects
the wrong CM for the job. Under many public statutes, the CM is precluded from
performing work with its own forces.
Agency Construction Management and independent
contractor CM have been used successfully for many years for projects involving
building construction. Many owners prefer these project delivery systems to
advance projects rapidly from conceptual design to finished, constructed
product. Full-service environmental design firms are increasingly undertaking
the CM's role in remediation projects. The trend toward full-service remediation
is driven by environmental remediation projects which are complex and generally
not understood by the owners. These projects also need professional services
throughout the project to alter the design to conform to actual conditions
encountered during construction. Generally, remediation projects also require
detailed documentation of field activities and interaction with regulatory
agencies which can be provided by the CM. Construction management can be an
important project delivery system to complete environmental remediation projects
cost effectively and on time.
Privatization
Privatization is a variety of techniques and
activities to promote more involvement of the private sector in providing
traditional government or public services. Privatization is not one or a limited
set of techniques but is a number of management techniques to affect delivery of
a project. Some advantages of privatization include capital cost savings to the
public, shorter implementation time, and the ability to procure services or
projects otherwise unavailable in the public sector. Constraints to
privatization include the need for legislation to allow privatization and
political opposition to the privatization concept. Another constraint is the
potential for labor problems from public employees unions, and from public
employees themselves if public sector jobs are eliminated as a result of
privatization.
Partnering
Partnering is not a project delivery system, but
is a way to conduct business among the team members. In the partnering approach,
the owner, contractor, and design professional develop an agreement before
construction based on the mutual trust among the parties. Generally, the
partnering agreement is the culmination of a preconstruction workshop led by an
independent facilitator. Key elements of partnering include Commitment, Equity,
Trust, Mutual Goals Development, Timely Responsiveness, Implementation, and
Continuous Evaluation. Private-sector partnering and public-sector partnering
can have different aspects. In the private-sector arrangement, long-term
relationships can be established among the owner, A/E, and/or construction firm.
In the public sector, the partnering arrangement generally begins after the
award of the contract, and includes the owner, design professionals, and
contractor. Both the public and private sectors partnering agreements have the
common thread of increased productivity, cost-effectiveness, and continuous
quality improvement of services and products.
© Lourie Consultants, June, 1996
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