Fear and Loathing in Integrated Project Delivery

(By Paul Durand, AIA)


Our firm’s foray into BIM (Building Information Modeling) was largely fueled by the promises of a brave new world of Integrated Project Delivery. It seemed a godsend to the industry, in fact, the Holy Grail. It was a sane path to building success that seemed so smart and yet so obvious. Our “eureka” was ironic since most industries in the world utilize such practices in developing and producing new products and have been for ages… our world of bricks and mortar is still Neanderthal and this new integrated approach has a revolution on the brink. So we dove, head first, into BIM in 2003 and fully committed to it as our only design platform a year later. There was plenty of heartache and headache but with such potential to make us better, we persevered unwavering toward our goal of virtually building.

A Quixotic quest ensued to revolutionize the building industry. We lobbied consultants and contractors to join us in building an integrated team and sought clients to get on board. After all, word on the street was that it was the clients who were demanding the change. We found most (maybe all) potential clients were tired of the frustrations of building: the cost overruns, the change orders, delayed projects and, as one client put it, “taking their dreams out of a project to meet their budget.” A lot of doors opened and our enthusiasm alone put us in the presence of movers and shakers of industry and institutions. Everybody wanted to hear about this “new” method of building and to find salvation in the faltering economy.

But our “dragons” were formidable. On every occasion, the fear factor reared its ugly head. Change doesn’t come easy; especially in the only industry that hasn’t evolved in 50 or more years.

But our “dragons” were formidable. On every occasion, the fear factor reared its ugly head. Change doesn’t come easy; especially in the only industry that hasn’t evolved in 50 or more years. Owners wanted one throat to choke and that didn’t include their own. They wanted someone else to guarantee the cost of the project and those haunting cost overruns would be someone else’s error to hide behind. Subcontractors didn’t want “the man behind the curtain” exposed. The very idea of transparent financials or sharing their cost drained blood from their well fed faces. Architects ran for cover and ducked under anything they could find to shield them from the heresy and the tarnishing of their artistic self image by such an ugly undertaking as leading a virtual building exercise. That was contractors’ work and, of course, they sought safety in the catch-all bunker of “liability,” the hobgoblin of change and all things new. Contractors didn’t want to give up project control or the profits that managing risk in a dysfunctional industry provides in abundance. It was clear that this new world needed to be client driven, but that wasn’t happening. There was too much fear, it was too much change, too soon and untested across industries. It had worked for hospitals and had to work for AutoDesk but would it work for everybody else? And the tanked economy gave clients the upper hand for now. Why change course?

So after three years into our quest it became clear that the fear factor had to be alleviated if Integrated Project Delivery was going to arrive in the mainstream. It would have to evolve rather than make a quantum leap and my instincts told me the end result would be a tempered version, a hybrid, rather than in its pure form. The first step was to change our behavior. We needed intensified early planning and communication between our team of designers and constructors, suppliers and Owner. We also had to operate under modified versions of standard contracts so as to keep liability managed and insurances intact. We had to have greater trust and respect within the team and frankly, take some risks, so we could explore innovation and efficiencies in our work process; especially since so much of the inefficiency in our system is duplication and redundancy to limit liability or “target” responsibility to, or away from, a particular source. What we wanted to do was to develop and hone skills in the new method to demonstrate success and benefits so clients and building authorities will demand an integrated approach and be comforted by our past success.

The first step was to change our behavior. We needed intensified early planning and communication between our team of designers and constructors, suppliers and Owner. We also had to operate under modified versions of standard contracts…. We had to have greater trust and respect within the team and frankly, take some risks…

So we developed an approach that captures the benefits of a pure Integrated Project Delivery method while limiting or eliminating the fear factor. It’s our Virtual Building Prototype method of project delivery where the goal is just that, to virtually build a prototype of a building prior to actual construction. We use BIM and team with consultants and builders who do the same or, if needed, we supplement their capabilities. We enter into standard design-build or construction management contracts with modifications to integrate the team. We don’t form a single purpose entity or engage in multi-party contracts that aren’t familiar with our industry. We do agree on intensified early planning and communication and we consult and validate project goals.

A pure IPD method would have work performed at cost, with financial incentives to motivate the team to achieve project goals and limits of liability to override inefficiencies in the blame game. Instead, we provide work at standard fees without transparent financials. We negotiate shared savings with the entire team, usually from established and agreed upon contingencies. We do try to limit liability but it’s not a deal breaker and we do agree to work with the contractor, subs and suppliers, using Lean Principles, to create greater internal efficiencies such as reducing or eliminating the need for shop drawings and superfluous work. We feel that greater efficiency is in itself the financial reward and motivator…and ultimately, the key to IPD success. We want to save everybody money in the process, not add cost to design with a promise to save in the end. The Owner is protected by a standard CM open-book accounting contract while other key participants can be negotiated or paid pre-construction fees for their early input and their trade work bid in a normal manner.

We feel that greater efficiency is in itself the financial reward and motivator…and ultimately, the key to IPD success. We want to save everybody money in the process, not add cost to design with a promise to save in the end.

Our method is to collaborate and include the Owner as much as possible, or as much as they desire, but mostly we seek to virtually build with expert guidance and enhanced communication with an integrated team of key participants. We develop the project in a target value design process rather than rely on “value engineering” so that we don’t have to rethink or redo work that is over budget. Value engineering is lost time and money for everyone, and the “value” is usually the first thing lost in the process of reducing cost. By using BIM, all those who have a stake in getting it right can take a virtual trip down the path of their work to ensure that all things can be installed and operate as planned and in the most cost effective manner. Constructors and suppliers enhanced understanding provides much more accurate pricing, less field decisions and a lot less changes during construction; saving all time and money. With all those experts in the room and with the great ease of BIM to make, even major, changes in building systems we can run a number of “what-if” scenarios to test the economics of a variety of systems and even see the effects in energy savings so we can fine tune the building to the bottom line.

A smoothly run construction project makes everyone look good. A smoothly, efficiently run project is also profitable and doesn’t cost our client’s more money. Knowledge and information is the key.

Generally our projects have won or lost profit during contract administration. It’s the phase that we have less control over and can’t easily anticipate time expended. If we try to manage our time down, that seems like an impediment to project success by the Owner and Contractor and sheds a pretty dim light on our service. A smoothly run construction project makes everyone look good. A smoothly, efficiently run project is also profitable and doesn’t cost our client’s more money. Knowledge and information is the key. Our goal in the brave new world of Building Information Modeling and Integrated Project Delivery is to make the process of design and construction more efficient for all concerned and saving everyone money, particularly our clients. It’s simply about better communication and better understanding.

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Comments
One Response to “Fear and Loathing in Integrated Project Delivery”
  1. Jeff Reardon says:

    What a well written article. Thanks to you and your team for sharing your experiences. Very Informative and Very Helpful.

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