Guide to Project Delivery Methods
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The project delivery method, or construction delivery method, sets up how the involved parties in a building project will be organized – this forms the hierarchy (who responds to who), who carries the risk, and when each party becomes involved in the project. Each project is different, so how each project is completed should be different too.
There are five basic project delivery methods, but you can have variations on the five. Usually, the owner will dictate what kind of project delivery method they want to use. If you are submitting a proposal on a project and think a different method would serve the client better, let them know. Focus more on why the new method would be good for them and less on why the method they originally chose is terrible for the project. Who knows – this alone could give them good reason to select you as the architect for the project. The five main methods are:
Project Delivery Methods
Agent vs. Vendor Contracts
Before we get started on the various types of project delivery methods we need to say a few words about agents vs. vendors. An agent, or consultant, is someone, be it an architect, engineer, or construction manager, who works in the interest of the owner. They are being paid for their professional services vs. for a product and provide oversight at points in the project to make sure the owner is getting what they want and what everyone agreed to.
A vendor is someone who provides a product for an agreed upon price. In the case of a building, if the vendor provides a building on the schedule and at the price agreed to, they have fulfilled their contract. Some contractors, especially architects, switch between being an agent and a vendor in one project. When they switch and if they switch depends on the project delivery methods.
It’s important to understand the difference between the two. A vendor isn’t going to direct the project direction like a consultant would. Their main objective is to provide a specific product. Once that is finished, they are done. An agent works with and advises a client. For the most part, a vendor is told what to do, although the means and methods are typically up to them. Knowing what roles each contractor plays (agent vs. vendor) and knowing what they need will help the owner select the right construction delivery method for them.
Public Sector Projects
One last quick word before we get started on the different delivery methods. Public entities cannot pick a construction delivery method that doesn't include a competitive bidding phase due to current U.S. law. If you are bidding on a public sector project and are thinking of suggesting a new construction delivery method, keep that in mind.
What is Design Bid Build?
A design bid build delivery method is the traditional model and the most commonly used. With this method, there are three distinct phases: design, bidding, and construction. The owner first enters into a contract with the architect to complete the design. At this point, the architect is considered kind of both a vendor and an agent. You will be providing a product - the design - for an agreed upon price, but you also consult with the owner to reach that final product. After the design documents are completed, a Request for Bid or Request for Proposal is sent out to contractors. A contractor is selected and the owner forms a separate contract with that contractor. Here the architect switches to an agent and provides oversight during construction on behalf of the owner. The contractor is a vendor for the duration of the project. The architect and contractors typically have engineers and other subcontractors under them.
Advantages and Disadvantages to Design Bid Build
The step by step process of this method can take longer than others – no design and construction overlaps are allowed. The design must be fully completed before construction can begin.
Since the design is fully thought out before construction begins the project costs are typically lower using this method. When using this method, everyone knows what role they should be playing, as it's so common and well-known.
When Design Bid Build Should Be Used
Owners should select this method when the project is fairly straightforward, the budget is limited, and the schedule is not limited. Most of the projects you will work on will use this construction delivery method.
This is the second most common project delivery method. With this method the owner only has one contract with a group that handles all aspects of the project – from design to construction. This is either done by a firm who does everything or a team of firms working together. If you are an architect working with a construction company on a design-build project, you will be in a joint contract with the construction company.
Advantages and Disadvantages to Design Build
This is one of the fastest methods. You do not have to get a full design finished before starting on some aspects of construction. Cutting out the bidding process also saves a lot of time and headache for both you and the owner. You can also cut costs by limiting change orders if you and the construction company are working together on the design. You will know if there will be a problem and fix it before a change order is needed. Any design changes will go quickly through your team and most disagreements don’t need to include the owner.
To have this method work well, you need to trust your partner. You should vet a company you are looking to team up with. Start by looking at their website – do the projects they work on look to be the same scale and level of difficulty? If they do, find some companies they have worked with before. Interview those previous partners fully. Putting the work in before you have entered into a contract with them could prevent a nightmare in the future.
With this type of method, there isn’t an agent representing the owner’s interest. This means the owner can be very removed from the process after the early design work. In a traditional design bid build project you, as the architect, would represent the owner during the building phase. Most owners will hire a third party to represent them during the building phase. While this makes sense for them, it can negate some of the benefits of using this delivery method.
When Design Build Should Be Used
Owners should select this method when the project is fairly straightforward, and the schedule is limited. Sometimes, there might be project site variables that might require early coordination between the architect and contractor. If the owner can clearly communicate what they want and then trust the team, this method works really well.
What is Multi-Prime?
With a Multi-Prime delivery method, the phases of the project are similar to the design-bid-build method – design, bidding, construction. The agent and vender assignments are similar to the design-bid-build method. The owner takes on the role of the general contractor and is in charge of all phases of the project. Here, the owner has separate contracts for the contractor, the architect, and any subcontractors. Each of these main contractors would be considered a “prime”, thus the name.
Advantages and Disadvantages to Multi-Prime
This project delivery type can drive up costs. With so many contractors working at one time, any mismanagement could result in duplicated efforts or re-doing work due to restrictions or requirements of other contractors. Final project costs are not determined until late into the project due to contractor coordination. Scheduling all the different contractors can be a mess, as so many things are happening at once.
Again, this delivery method should only be used if the owner had the time and experience to adequately guide it to completion. If they are up to it, the owner can retain control the whole project and ensure they get exactly what they want.
When Multi-Prime Should Be Used
This method should only be used if the owner wants and can handle full responsibility for the organization and management of the whole project. This is the only delivery method that works on public entity projects in states that require the public entities have the maximum control during the project.
What is Construction Management at Risk?
The construction management at risk method (CM at Risk) allows owners to hire a construction manager (CM). The CM is considered to be at risk, because the CM switches from an agent during the design phase to a vendor during the construction phase. In doing so, they take on all the risk for completion dates and pricing promises.
In a variation of this method, known simply as construction management, the CM will act only as an agent who consults the owner during the design phase and a separate contractor is hired for the construction work. This is less common.
Advantages and Disadvantages of Construction Management at Risk
This has similar advantages as the Design-Build method. When the builder can enter the conversation early in the design, they can improve the design with their opinions on materials and constructability. This can help lower costs by reducing changes to the design later in the project.
Disagreements between the architect, CM, and/or owner can slow things down. Adding more cooks to the kitchen isn’t always a good thing.
When Construction Management at Risk Should Be Used
Owners might select this method when they want a concrete completion date and a fixed price. The CM takes on all the risk for completion dates and pricing promises, but the owner is still responsible for ensuring the completeness, accuracy and details of the design.
What is Integrated Project Delivery (IPD)?
This method is still very new. The owner selects an architect and contractor prior to any work beginning and they all work together to define the goals and specifics of the project. The owner, architect, and contractor enter into a joint contract. Because all three are bound through the contract, they also all share the risk.
Advantages and Disadvantages of Integrated Project Delivery
This is viewed as one of the most efficient delivery methods. The contractor has a say in the design at an early stage and can suggest changes that limit delays and problems in the future. The owner also stays heavily involved during the whole project. This increased collaboration between all the parties likely minimizes the potential risk.
Because this is such a new method, it doesn’t have the long history backing it. This can make it hard to convince parties to use it. Because the owner is selecting all the contractors early on in the process, they mostly have to trust their intuition on how the parties will work together. If they get that wrong, it could mean delays and higher costs.
When Integrated Project Delivery at Risk Should Be Used
This is best used when the project is largely undefined and needs massive coordination to come to a solid definition. If the project is under a very tight schedule, this method can work very well. Due to the lack of a competitive bidding process, only private entities can pick this method. This cannot be used on public entity projects.
How to Pick a Method
Simply put, the right project delivery method will set the project up for success from the beginning. AIA Minnesota created a very helpful list of twenty questions to ask to help ensure all the information is found early on in the process. These questions are not only good to ask in general, but can also help the delivery method selection. The twenty questions are:
- Who needs to be involved in making decisions?
- Will you assign staff to oversee the project? Do they have experience in building projects?
- What are the goals of your project? What are the constraints?
- Have you clearly defined the scope of the project?
- Have you done this type of project before?
- How will the project be funded or financed?
- What are the critical limits of the schedule?
- Has a site been selected and purchased?
- How do you obtain the best value for your unique requirements?
- What are the qualities you value in your facilities?
- What are some special considerations that may emerge in the design process requiring attention?
- Do you have concerns about the life-cycle and operational costs of the building?
- Can we be responsible to the limited resources of our environment?
- What are some of the special technologies a project may require?
- What is the financial commitment and risk on this project? Are there options?
- How do you identify the construction cost of the building?
- What is the role of the design professional in representing the owner’s interests?
- What is project delivery?
- When might an owner need to select a particular project delivery method?
- Which project delivery system is best suited for our project?
- The Ultimate Guide to Choosing the Best Project Delivery Method
- Construction Project Delivery Methods
- Choosing a Project Delivery Method
- AIA Understanding Project Delivery