Question: There’s a lot of talk out there about Integrated Project Delivery, or IPD, as the latest and greatest method to deliver a construction project. Can you give me a high level overview?
Answer: Integrated Project Delivery is being hailed as “the next big thing” in many circles.
Integrated Project Delivery (“IPD”) is a fundamentally different approach to design and construction that harnesses the talents of the owner, designers, engineers, contractors and selected subcontractors and, from inception, forges them into a single collaborative team. Liabilities are waived between all parties. Profit is put at risk and dependent upon meeting mutually agreed upon performance and delivery metrics. It’s a brave new world – aiming to turn a design and construction process that has been historically fraught with opportunities for conflict into a collaborative process where players with sometimes competing interests operate as a single team with shared risks and rewards.
Upsides? IPD proponents claim the process provides owners and participants the ability to save money, avoid legal claims and meet or exceed schedules and budgets. For the designers, contractors, and subcontractors, a well executed IPD project can mean increased profits, a better project and reduced time to completion.
Before venturing down the IPD path, be aware that the model works best on large, complex projects – a new manufacturing plant, for example, and is generally not suited for smaller projects or routine renovations. The healthcare sector is acknowledged as being early adopters at the forefront of IPD – where the design and construction of complex medical facilities have been undertaken in a number of instances using this new delivery methodology. My firm—SMRT, Architects and Engineers—is currently designing and engineering a new 640,000 square foot hospital using IPD. Well under construction, the project is running significantly ahead of schedule and below budget.
While there has been a lot of talk about IPD, the process hasn’t been adopted wholesale – leaving a relatively limited number of projects completed or underway to benchmark. Additionally, there are a number of variations on the theme out there – so should you decide to benchmark a project, be sure it’s a fullblown IPD execution, and not “IPD-lite.” In short, all the major parties listed above should be “playing in the sandbox” – not only fully integrated into the project from its earliest design stages but also party to profit at risk and waiver of legal liabilities.
For a project to be accurately classified as IPD, it should contain five key elements in its contracts and project execution:
- Early involvement of key participants;
- Shared risk and reward based on project outcome;
- Joint project control;
- Reduced liability exposure; and
- Jointly developed and validated goals and targets.
Executing the contract and the insurance agreements— between the owner and all key participants— is the first challenge. Make sure your team has jointly engaged an attorney both proficient in theory and experienced in executing IPD agreements. This is an emerging field, and requires specialty expertise. When constructing the legal documents, it’s important for all parties to “negotiate collaboratively” an accomplishment in itself in today’s litigious society. Difficulties collaboratively negotiating an IPD agreement likely won’t bode well for executing the project itself.
Howard Ashcraft, Esq., one of the leading legal authorities on IPD, advocates that it’s better to follow the rule: deal first, language second when putting together the contract. Too often parties focus on the contract language before addressing and resolving key business and process concerns, diverting attention away from fundamental issues that will drive the success of an IPD project. The first focus needs to be on shared project goals and desired outcomes, which will drive the remaining structure.
Four key micro-components to IPD project success to consider include:
- Appropriate attitudes, practices, and processes adopted and inherently integrated in the design and construction management techniques adopted by the IPD team;
- Collaborative decision making;
- Co-location; and
- BIM.
For any IPD project to succeed there must be an owner totally committed to the process, willing to undertake a revised role as a team member and capable of adopting the attitudes, team mentality, and role reversals that will allow the IPD project to succeed. That attitude must be inherent in both the owner executive and every member of the owner’s organization. If an owner isn’t 150% committed to the IPD process, walk away from this delivery method. Ideally, the owner should be the leading advocate.
Just as an owner is required to shift away from traditional roles and attitudes, the major design and construction parties must adjust their approach as well. Key members of the cast might include the construction manager, general contractor, architects, engineers, and all major subcontractors. Beyond technical qualifications, each of these parties must understand and buy into the IPD process – most importantly there needs to be a foundation of trust and respect between the members of the team. The relationship of collegial accommodation, trust and open communications between the key players may be the single most important factor in whether an IPD project succeeds or is fraught with difficulties.
In order to facilitate efficient decision making, collaboration throughout the design and construction process, and the ability to respond to issues as they arise, co-locating members of the team in a single building is ideal. The “co-lo” functions as the project’s central nervous system, not only facilitating collaborative decision making but allowing for expedited cost modeling, specialty training and workshops and even the construction of mock-ups to allow the owner to evaluate and make adjustments to various project components before they become more expensive change orders. The co-lo can be equipped with work stations, meeting rooms, and videoconferencing, including spaces to accommodate members of the team not assigned to the co-lo on a daily basis. Perhaps most importantly, the co-lo drives a sense of teamwork, communications, and camaraderie.
Building Information Modeling, or BIM, becomes an integral piece of an IPD project’s success. Given the simultaneous and parallel tracks of design and construction, and the requirement to make adjustments quickly, having all parties on BIM eases daily decisions and contributes to accelerating the schedule and reducing costs. It’s likely that some of the team members, especially smaller subcontractors, may not be BIM savvy. Developing a comprehensive training program, with mentoring by the larger contractors, is one solution.
At the end of the day, engaging in Integrated Project Delivery is about a unified team realizing a superior project, delivered in less time and with significant cost savings. The rewards can be worth the risk.
Richard Bilodeau, PE, is director of engineering at SMRT, architects and engineers (www.smrtinc.com). His 30 year career includes plant engineering positions in clean manufacturing. Richard has designed, operated, and supervised the construction of advanced technology facilities, numerous industrial projects, healthcare facilities, and corporate offices. He’s engineered clean manufacturing facilities for lithium-ion batteries, medical devices, electronics, and pharmaceutical clients. Richard can be reached at: [email protected].
