Author Note:
ART-IS-ZEN® architecture & engineering
2605 S Decatur Blvd, Ste 123 Box 101
Las Vegas, NV 89102-8591
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Abstract
Design-build is emerging as the preferred method of project delivery with lower costs, faster times, and better quality. It combines architectural, engineering and construction tasks under one business entity. Contractors are then able to offer a single point of contact for building and facility owners. This reduced the liability and exposure for their clients while providing better project performance. With increased risk to the contractor, focusing on early team building with a common culture is vital to project success.
Keywords: Uncertainty, Risk Analysis, Project Delivery, Design-Build

The concurrent execution of architecture and engineering with construction and management is referred to as design-build (DB), often performed by a single business entity or through joint venture (JV). This contrasts the common method of design-bid-build (DBB), where those project phase are performed independently and by separate organizations. The design task should be more than the formulation of plans; it could incorporate the all required aspects of construction. The construction process would be managed if integrated into design with better coordination and closer cooperation (Wang 2022). Concurrent operation of project phases will reduce cycle time and strengthen feedback, though with increased exchange of information and much greater risk of rework. Strategic planning is therefore essential in success for DB projects.

While DBB remains the predominant delivery method, more owners are advocating for DB and construction manager at risk (CMAR) resulting in better performance. Low-bid contracts continue to be the predominant criteria for procurement. Several disadvantages come with these unrealistically low bids, typically resulting in change orders, schedule delays and legal disputes. Qualification-based selection (QBS) and best-value selection (BVS) are being used to procure the best contractors. These alternative contracting methods are often chosen when the scope of work, drawings and specifications stated in the request for proposal (RFP) is vague or incomplete (Shalwani 2019). Since hard bids are difficult to determine under high levels of uncertainty, selection is made by evaluating qualifications and expertise of bidders. The Design-Build Institute of America (DBIA), the Construction Management Association of American (CMAA), and the Associated General Contractors of America (AGC) have all endorsed these as the preferred selection method.

The criteria for selection of architectural and engineering (AE) consultants and DBB contractors differs somewhat from those used to evaluate design-build teams (DBT) and construction management teams (CMT). Owners should make selections by review and data analysis of cost, schedule, technical proposal, past performance, interviews, and related experience (Shalwani 2019). These results offer better differentiation than competitive bids, providing construction managers and design-builders with an accurate prediction of future performance by consultants and contractors.

The concept of a ‘master builder’ has is rooted in the skilled trades of craftsmen and traditional roles of architects and engineers. While the design and construction remains the goal of any everyone in the industry, the methods of delivering these projects continues to evolve. Modern construction and current legislation has developed into the specialization by companies and industry professionals. During the past century, the DBB method has become the industry standard as a result. Alternate delivery methods have emerged due to inherent deficiencies in DBB (Sullivan 2017). Technological advancements and computer integration over the last decade are changing the way projects are designed and built, while providing new opportunities to improve quality, tighten schedules and reduce costs. Coordinating the design engineer and construction manager with a JV agreement assigns sole responsibility, and engaging with the project owner under a DB contract creates a single point of contact.

The primary metrics of project performance remain cost, schedule and quality. Selecting the DB or the CMR delivery method over DBB offers many advantages to building and facility owners (Sullivan 2017). Cost growth is a prediction of total cost defined by the percentage change from initial contract amount or estimate to final actual cost upon project completion. Unit cost is a measure of cost per unit of work by time or material based on historical data at various levels of detail, often factoring in project location and economic conditions. Schedule growth anticipates the actual duration as a percentage deviation from scheduled duration of a project. Delivery speed is the production rate at which a quantity of work units is completed per unit of time. Since finish quality and specified standards are subjective in nature, there is no universal way to measure it. The satisfaction of stakeholders and end-users or the overall value of the improvements are two options. Analysis of two decades of project delivery illustrates the significant benefits of DB over CMR and DBB (Sullivan 2017).

Integrated project delivery (IPD) has emerged as an alternative delivery system that involves key participants early in the construction timeline often before the start of design (El Asmar 2013). This can be accomplished through JV allowing for sharing of risk and rewards by project stakeholders. This differs from traditional DBB where the owner contracts separately with a general contractor (GC) once the design is 100% complete and from collaborative DB which occurs around 20% of design (see Fig 1). This method arose from statistical analysis and technological developments in response to several problems and varies changes happening in the industry. The goal was to guide construction towards cooperative, cross-functional teams of designers, constructors, and facility managers (El Asmar 2013).

Figure 1: Differences between IPD, DB and DBB (El Asmar 2013)

Gross floor area (GFA) is the most significant factor affecting project cost with privately owned buildings generally being more expensive as public facilities are tax funded and require financial prudence (Ling 2004). Owner involvement in design will likely increase costs due to frequent changes and reluctance towards cheaper solutions. The expense of public funded buildings in advanced countries may exceed general estimates when life-cycle costs and sustainable design are incorporated. Cost growth is higher when the GC has a smaller financial capacity and therefore less ability to control cost. GFA is the main indicator for production time. Larger developments with increase scope allow for concurrent tasks and parallel work to be completed (Ling 2004). Economies of scale and prefabrication will further reduce schedules. Inadequate staffing and lack of urgency will affect schedule growth.

Quality performance an owner satisfaction are subjective variables that are difficult to quantify. The ability of designers and contractors to meet acceptable standards is often assumed based upon prior experience and past projects (Ling 2004). Historical records of past performance are a testament to proper management of future endeavors. Low incidences of defective or remedial work indicates good quality control and predicts favorable outcomes for new facilities. Owner satisfaction becomes dependent on technical expertise, acceptable project completion, and magnitude of change orders, variation from initial bid and flexibility in scope of work (Ling 2004). Expectations increase with commitment of additional personnel and equipment.

The traditional DBB method separated design activities and construction tasks between different organizations. Under a DB agreement, owners can assign design and construction of project to a single business entity. These contract have emerged over the past two decades, continuing to gain use and acceptance. The sole responsibility leads to shorter delivery time, greater financial certainty, better project coordination, and transfers design risk from the owner to the contractor. Those risks include 1) improper design schemes, 2) lack of designer responsibility, 3) lack of designer experience, 4) inadequate design teams, 5) delays or inaccuracy by third-parties, and 6) design changes and reviews (Liu 2017). Unproven design solutions and insufficient standards / specifications are the predominant factors.

Risks are inherent throughout the construction industry and vary with the size, scope and complexity of a project. The range and severity of those risks is partially dependent upon the method of procurement (see Fig 2). Contingency plans and budgets are risk management tools that have become essential to the successful completion of complex projects. These procedures and preventive measures maintain control of uncertainty regarding schedule targets, construction costs and quality objectives (De Marco 2015). Additional funds in escrow accounts provide management flexibility and allow for deviation from original project plans. Unspent fund can later be used for future improvements or release as added profit. This will vary based on owner pressure and willingness to improve the facilities.

Figure 2: Allocation of Risk by Procurement Method (Ogunsanmi 2011)

DB remains a risky system of procurement for owners and contractors unless risks are properly identified, analyzed and managed throughout project preparation and execution (Öztaş 2004). Schedule overruns occur due to changes in scope, unexpected site conditions, and design delays. Time penalties by the contractor and owner approved time extension are used to prevent or mitigate these risks. Cost estimates are derived from floor areas, construction drawings, and material / labor costs. Different methods and risks are associated with lump sum, direct cost, unit rate, and percentage of completion. Client involvement has a substantial affect project success. Clear specification of requirements during design, bidding and construction along with limited requests for change orders will reduce those risks (Öztaş 2004).

DB has become widely used procurement system for infrastructure projects. Research shows this approach to be 33% faster than DBB in implementation with a 12% improvement in production rate at a 6% higher cost (Rostiyanti 2019). As the project scope increases, so does the risk to contractors. Contractors must be able to recognize and properly manage those risks. The wide range of performance benchmarks used in architecture, engineering and construction (AEC) projects is analogous to those in the sports industry. Project quarterback rating (PQR) combines key areas of AEC into a single number (El Asmar 2015). Those criteria are 1) customer relations, 2) safety, 3) schedule, 4) cost, 5) quality, 6) financial, and 7) communication which are include various tasks and metrics (see Fig 3).

Figure 3: Project Quarterback Rating Structure (El Asmar 2015)

Analysis of performance data has revealed that DB project will be delivered faster and at a lower cost than those by CMR or DBB methods. Early team formation, a relational culture, clear expectations, and repeat clients were common factors in the most successful projects. A lack of experience, poor communication and client turnover were exhibited by the worst performers (see Fig 4). To ensure future project success regardless of the project delivery system, it is recommended that 1) the team be brought together early, 2) a relational project culture be developed, 3) expectations be communicated clearly, and 4) succession planning be implemented (Molenaar 2018).

Figure 4: Comparison of Project Performance (Molenaar 2018)

References
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