Project Delivery Models

Design and communication of detailed instructions to those who build have been evolving for a long time. In an earlier post Building Information Modeling (BIM) was discussed as perhaps the latest technology facilitating this aspect of taking projects from concept to reality.  As computer technology for detailing and communicating project design changes, questions arise about the related concept of Project Delivery Models.  How do Project Delivery Models need to adapt to these new technologies?

The plan, design, bid, and build process has, in the interest of pursuing efficiencies and incorporating new technologies, morphed through adaptations such as fast track, design build, and turnkey project implementation. Associated with these design, communication, and process developments are changes in the relationships of the various contributors.

One challenge is to more clearly define those roles, how they relate to each other, how their participation can be facilitated and made more efficient and, yes, how they can be held accountable for their contributions to this new way of taking project ideas into reality. Those relationships need to be conceptualized, defined and implemented through modernized contracts. And in an imperfect world, where things go wrong, risks need to be provided for in ways that encourage conscientious performance and discourage excessive risk taking.

As a foundation for continuing to refine Project Delivery Models we can first examine the traditional elements.

Project Team

Taking a construction project from concept to reality can follow any one of a number of paths. Depending on which is chosen, a different combination of project team members can participate and different kinds of agreements between those participants are appropriate.

As a first step let’s identify the typical project participants:

  1. Owners
  2. Developers
  3. Investors
  4. Planners
  5. Site Evaluators
  6. Surveyors
  7. Designers
  8. Financers - both Construction and Long Term
  9. General or Prime Contractors
  10. Project Managers
  11. Subcontractors
  12. Utilities
  13. Materials Suppliers
  14. Equipment Vendors & Installers
  15. Construction Inspectors
  16. Materials Testers
  17. Regulatory Agencies
  18. Tenants or Occupiers
  19. Insurers
  20. Maintenance People

It is possible that some have been overlooked. But the list does indicate the number and kinds of entities that can participate in taking a project from concept to a physical, operating reality. The contributions and efforts of these entities must be coordinated and lines of responsibility and accountability must be clearly defined to reduce the risk of miscommunication and confusion.

The efforts of these project participants are coordinated using any one (or possibly a combination) of project Delivery models. Let's identify and define some of the Project Delivery Models.

Design - Bid - Build

Sometimes thought of as the traditional project delivery model, it contemplates an owner coming up with a project concept and retaining consultants to help plan and design the details. The end product of the planning and design process is a set of plans and specifications that provide a basis for soliciting bids from qualified contractors. The bid may be awarded to the lowest qualified bidder who can be counted on to deliver the constructed project. This would be a general contractor who assembles a team of subcontractors and material suppliers, combines their bids, and adds his/her own costs and profit in assembling the bid submitted to the owner. The bidder/ general contractor takes on the responsibility for delivering the project and coordinates assembly of all the components.

Design - Build

A different approach is the project owner or developer, perhaps with the assistance of a planning consultant, develops a generalized project description, perhaps including certain performance specifications. The owner or developer then negotiates with a design build contractor to deliver the project.  Since the project is defined in terms of performance specifications, it then becomes the design build contractor's responsibility to come up with the specifics of the components that will meet those performance specifications.

Project Manager with Multiple Prime Contractors

As we can see, the boundaries of each of the project team members can shift from placing more of the responsibility either toward the owner or the contractor. For a design build project, the shift is toward placing more responsibility on the contractor. When an owner developer has knowledgeable staff or sometimes specialized project requirements, in-house staff can play a greater role acting more like a project manager or general contractor.  The owner’s staff assembles and coordinates consultants and contractors who may be viewed as multiple primes answerable directly to the project owner.

Turnkey

Another approach shifts the entire responsibility of delivering a fully operational project to an owner.  A turnkey developer can take a project through the entire process, including financing, design, construction, approvals, licensing, and operational startup.

Other Project Delivery Models

Other arrangements are possible. The foregoing are the most common.  Also, with the advent of Building Information Modeling, project team roles, and the boundaries of those roles, are changing. The team needs to be assembled early in the project so that participants can begin contributing to building the model. Perhaps commitments need to be made before the cost of a project can be known. Sorting through the options made possible by new technologies is an interesting challenge and topic of discussion for the design and construction industry.

Sources of More Information on Project Delivery Models

And More about Project Delivery Models

 

The objective of this blog is to share information about issues that architects, engineers, and their attorneys encounter.  If you have any ideas or suggestions for specific topics to address, or if you would like to contribute an article for publication please let me know at aeissues@gmail.com

This article expresses ideas for consideration and should not be taken as recommendations applicable to any specific situation.  When making a decision on how to address a specific situation consulting with an experienced attorney is recommended.

© 2017 John Wersyn, All Rights Reserved


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