The following is a brief overview of some of the issues that can impact the decision to initiate a construction project. These are applicable to both new site development projects as well as existing facility renovations and expansions. In assessing the need to for a construction project, methods of project delivery should also be considered. When evaluating the various methods available for the design and construction of a potential project, it is necessary to assess your organization’s current and future needs, resources, abilities, and desires. Based upon the information generated in this self assessment process, you can then assemble a team of construction professionals that can provide the services and resources necessary to make the project a reality.
1. Project Initiation - The decision to initiate a
620 Construction project is a complex one involving the delineation of the project’s scope, goals, and budget. The owner needs to assembly and organize the resources necessary to assess, guide, and manage the development of the project. Questions to consider from inception of the project through the process of design include:
a. Why is this project needed?
b. What facilities are needed?
c. What are the overall aspirations for the project?
d. How are project decisions to be made?
e. Where shall the project be located?
f. What are the budget constraints?
g. How will the project be financed?
h. How will construction of the project be realized?
i. What is the schedule for realization of the project?
2. Project Goals - Prior to the inception of the project, there exists the needs, ideas, and desires that set the project into motion. Assessing, articulating, and focusing these needs and desires gives rise to the goals of the project. The following is a list of some of the issues to consider when establishing the goals of a project.
a. Performance Issues
i. Functional requirements
ii. Operational efficiency
iii. Human comfort
(1) lighting
(2) HVAC
(3) acoustics
iv. Energy efficiency
v. Green design
b. Monetary Issues
i. Construction costs
ii. Operating expenses
iii. Long term value
c. Image and Appearance
i. To the community
ii. To the occupants
d. Flexibility
i. Adaptability to current and future needs
ii. Expansion capabilities
e. Timeline and Milestones
i. Project commencement
ii. Site selection
iii. Agency approvals
iv. Financing
v. Project design
vi. Construction Documents
vii. Construction
viii. Occupancy
3. Project Delivery Options - There are many ways to take a project from inception to reality. The process by which the owner moves from project initiation, through design, construction, and finally occupancy is dependent on the needs, capabilities, and risks the owner is willing to accept and manage. In establishing a means to deliver the project, the owner assembles a team of individuals and organizations to direct, evaluate, design, develop, and construct the project. Some fundamental choices in how the owner intends to interact with the architect and contractor, as well as the level of risk the owner is willing to manage helps to delineate the appropriate means by which the project is delivered.
a. Design-Award-Build - This approach has been the most conventional method of delivering a complete project to the owner. It typically involves securing a design team to provide architectural and engineering services. The design consultants work with the owner in designing and developing construction documents for the project. At the completion of the design, several qualified contractors are asked to bid on the construction of the project. The owner then selects the contractor that best meets their needs relative to costs, performance, and comfort level. The owner then enters into a contract for construction with the contractor for the project. The architect assists the owner in assessing the contractors’ bids and qualifications and then provides for the administration of the 620 Construction contract. The following are some of the characteristics of the Design-Award-Build approach.
i. Clarity of Process - The roles of the participants are clearly defined, separate, and well understood.
ii. The owner engages a design professional to develop the design in response to the owner’s needs and goals. This process provides the owner with complete control over project quality and design.
iii. Construction documents are thoroughly detailed, establishing the standards of quality for the construction’s means and materials.
iv. Competitive bidding offers the owner the best price for the project as designed, but total costs for construction may not be fully known until the project is completely designed and bids have been received.
v. The architect acts as the owner’s representative, protecting the owner’s interests over the interests of the contractor in the construction process.
vi. Construction costs are established and firm at the completion of bidding. These costs reflect the complete design as approved by the owner. These costs vary only with changes in the scope of the project during construction.
vii. The process of designing, bidding, awarding, and constructing the project typically increases the length of time from project inception to the point the project is able to be utilized by the owner when compare to the time required to deliver the project using the Design/Build approach.
viii. Without the assistance of a construction professional to provide value engineering services, the owner often makes design decisions and gives approvals without understanding the full impact of these decisions on construction costs.
b. 620 Construction Management - This approach has become more common in the past couple of decades, especially on larger scale projects. It represents a modification of the more traditional Design-Award-Build process as described above. The addition of the construction manager to the design development and documentation phase of the project provides the owner with another professional to assist in evaluating and directing the development of the design. The construction manager acts as an advisor to the owner, providing direction on construction means, costs, and scheduling. In the construction phase of the project, the construction manger assumes many of the responsibilities of a general contractor, assembling schedules, contractors, and materials, and coordinating the construction process. While the construction manager performs many of the functions of a general contractor, the owner assumes the direct financial responsibility for the work. The following are some of the characteristics of the 620 Construction Management approach.
i. The construction manager adds the expertise of the contractor to the design process, providing the client with value engineering services in the development of the design.
ii. The owner engages a design professional to develop the design in response to the owner’s needs and goals. Engaging an independent design professional provides the owner with complete control over project quality and design. Full construction documentation is created, similar to the documentation created for the Design-Award-Build method.
iii. The construction manager solicits multi bids from the various building trades associated with the construction of the project. The owner then enters into multiple contracts with the various contractors for the project.
iv. The owner assumes greater responsibility for unforeseen construction costs associated with multiple prime contractors, endeavoring to save the costs associated with the use of a general contractor. The construction manager fee is expected to be less than the fee a general contractor would charge for the project.
v. Because the construction manager breaks the project down into components and multiple contracts, the time to deliver a completed project can be reduced by means of fast tracking the construction. Contraction can start on some components of the project while the design is still being completed on other areas.
c. Design/Build - This approach to project delivery is different from the methods listed above in many respects. The owner contracts with a single entity to provide both the design and construction services for a project. The owner will typically make the selection of the design/build firm based upon design and cost proposals submitted in response to performance criteria established by the owner. The use of Design/Build provides the owner single point responsibility in the development of the project. The following are characteristics of the Design/Build approach.
i. This method provides the owner with single source responsibility for design and construction of the project. The contractor becomes an integral part of the design development team, improving the integration of construction methodology into the design process (Value Engineering).
ii. Construction costs can be established early in the design process, offering the client the ability to make broad decisions on project scope and scale with quantified information of the impact these decisions will have on construction costs.
iii. Design/construction issues are internalized in the process, providing faster overall delivery of the project from inception to construction completion and occupancy.
iv. The owner sacrifices some control over design and construction quality in favor of cost controls.
v. The owner sacrifices the value of competitive bidding in favor of cost controls.
vi. This method is most successful when the owner is able to establish detailed performance criteria upon which the Design/Build proposal is built.
d. Bridging - This method of project delivery combines the advantages of Design/Build with the strengths of competitive bidding. In this approach, the owner selects a design consultant to develop preliminary design documents that respond to the functional and aesthetic requirements of the owner. The owner then requests several design/build contractors assemble a proposal for construction based upon these design documents. The design/builder has the latitude of delineating the means and materials to be incorporated into the project as they develop the proposal for construction. The owner awards a contract for construct to one of the design/builders based upon their proposal and associated costs for construction. The design/builder is then responsible for the completion of construction documentation. Once the documents are complete, the owner may then elect to proceed with construction using the design/build contractor or they may choose to pay for the cost of completing the documents, using them to competitively bid the project to multiple contractors. The contractor awarded the project then constructs the project and the owner’s independent design consultant assists the owner in administering the contract for construction. The following are characteristics of the Bridging approach.
i. The owner engages a design consultant to develop the overall project design, responding to the owner’s needs and goals. The result is a set of documents that roughly define the project’s basic scope and establishes performance standards required in the finished project. This provides the owner with some basic controls over the project’s scope, scale, and quality of design.
ii. The use of competitive bidding offers the owner the best price for the established design while the limited detail of the design documents provides the design/builder with latitude to perform some value engineering in the development of their bid. The owner sacrifices some control over quality in favor of competitively bidding the project.
iii. Reduced detail in the design development drawings results in reduced professional fees to the owner, shifting the costs for development of construction documents to the design/builder.
iv. The owner maintains the services of a professional to administer the contract for construction, protecting the owner’s interests during the construction process.
e. Partnering - Similar to Bridging, Partnering is a variation of the Design/Award/Build approach and the Design/Build approach. In the traditional methods of project delivery, the relationship between the parties, especially the architect and contractor is poised to be adversarial. The contractor, having provided a set cost for 620 Construction, works to control his expenses without full regard to the owner’s interests. The architect works to protect the owner’s interests, reviewing the work of the contractor in an effort to assure the owner receives the full value of the project as designed and bid. Partnering tries to eliminate the adversarial component by incorporating the services of a general contractor early in the design process. This secures the contractor’s skills in cost controls and value engineering to assist in the development of the design. The parties become a team, moving towards a common goal of constructing the project that best meets the owner’s requirements at a fair cost. The following are characteristics of the Partnering approach.
i. The owner engages the services of both a design professional and general contractor to develop the design of the project. The designer provides the direction for functional, aesthetic, and quality issues of the design and the general contractor provides the owner with value engineering services similar to a construction manager.
ii. The owner makes the selection of architect and general contractor based upon experience and capabilities. Fees for services and costs for construction are negotiated. The fee for the general contractor’s services is established in a manner similar to the construction manager. The general contractor will typically set a final cost for construction at the completion of the development of the design and construction documents.
iii. The owner avoids the financial risks associated with the use of the 620 Construction Managers.
iv. The owner maintains control over design and construction quality issues with the added value of tight cost controls. The general contractor provides information on construction costs early in the design process, offering the owner the ability to make broad decisions on project scope and scale with quantified information on the impact these decisions will have on construction costs.
4. Selecting a Method for Project Delivery - There is no single or best method of project delivery for all projects. There are many issues that impact this decision. Within any project, there are three overall design goals. Construct the highest quality project at the lowest cost and in the shortest time. These goals are typically at odds with each other. The design and construction process requires a balancing of these three and the owner must work to delineate the intricate relationship between the three for any specific project. The priorities imbedded within the relationship of the three goals may favor one method of project delivery over another. Some of the issues to consider when selecting the method of project delivery are as follows:
a. What is the construction budget? Is it fixed or flexible? How is the budget able to respond to quality and time issues?
b. Are there minimum qualities of construction or materials that must be incorporated into the project? What are the minimum functional requirements that must be addressed in the completed project?
c. Are there specific time constraints and deadlines that must be met?
d. What are the owner’s capabilities and what resources are available to assist in directing the design and/or construction?
e. How will the owner manage the process? What degree of control and interaction in the design and construction process does the owner desire to maintain?
f. What level of responsibility is the owner willing to bear in the design and construction process and what level of financial risk will the owner assume in response to potential cost savings?
g. How will the owner address, review and respond to design and construction decisions?