Cost Analysis between SABER and Design Bid Build Contracting Methods

The majority of Air Force construction is performed by two main contractual methods, design bid build (DBB) and simplified acquisition of base engineering requirements (SABER). DBB is the traditional contracting method in which each project is competitively bid. SABER uses one contractor to complete multiple projects using unit prices established in the original contract. This research performs a cost analysis between DBB and SABER construction projects. The research involved finding appropriate, comparable projects completed by the two contractual methods. Two diverse Air Force bases were used to gather project information, and a total of 46 interior renovation projects were used. Project comparability was demonstrated by evaluating the similarity of type and scope of work. Data from the projects was used to calculate unit cost per dimensional characteristic and time and cost growth for each project. The results indicated SABER contracting had a lower cost per square meter, although not at a statistical level of significance. SABER performed better in time growth. Cost growth was similar for both methods.     

Predicting Performance of Design-Build and Design-Bid-Build Projects

Design-build (DB) and design-bid-build (DBB) are two principal project delivery systems used in many countries. This paper reports on models constructed to predict performance of DB and DBB projects on 11 areas, using project-specific data collected from 87 building projects. The study included collecting, checking, and validating industry data, and the statistical development of multivariate linear regression models for predicting project performance. Robust models are developed to predict construction and delivery speeds of DB and DBB projects. Gross floor area of the project is the most significant factor affecting speed. Besides this, for DBB projects, contractors’ design ability, and adequacy of plant and equipment would ensure speedy completion of the projects. For DB projects, if the contract period is allowed to vary during tender evaluation, this would slow down the project. Robust models to predict turnover and system quality of DB projects are also constructed. A DB contractor’s track record is an important variable. They must have completed past projects to acceptable quality and have ability in financial, health and safety management.     

Analysis of Owner’s Design and Construction Quality Management Approaches in Design/Build Projects

This paper explores and classifies current approaches to evaluating quality in design/build (DB) proposals. It does so by a thorough content analysis of 78 requests for proposal (RFPs) for public DB projects with an aggregate contract value of over $3.0 billion advertised between 1997 and 2002. In most DB projects, the owner requires the DB contractor to establish a firm-fixed price on a project that has not yet been designed. Usually, the owner also fixes the project delivery period. In the traditional design/bid/build (DBB) system, quality is fixed through the plans and specifications. Thus, in DBB, with schedule and quality fixed, the cost of construction is the factor in which the owner seeks competition. Conversely, in DB, with cost and schedule fixed, the scope and hence the level of quality is the main element of competition. This paper identifies the six owner approaches to articulating DB quality requirements in their RFPs. The six approaches are quality by qualifications, evaluated program, specified program, performance criteria, specification, and warranty. These are important for DB contractors to understand so that they can craft their proposal in a manner that is both responsive to the owners’ requirements and consistent with the owner’s system to make the best value contract award decision.     

Effect of Delivery Methods on Design Performance in Multifamily Housing Projects

Existing studies on the performance evaluation by the delivery method generally indicate that the design build (DB) method is superior to the design-bid-build (DBB) method in terms of construction duration, cost, and quality. As opposed to the performance of construction duration and cost, where quantitative evaluation is relatively possible, most performance evaluations of quality are based on interviews with the owners. Therefore, this paper aimed at evaluating the level of design performance to conduct a quantitative evaluation on the performance of quality. To achieve this goal, this paper analyzed the impact of delivery methods on design performance in terms of the quantitative evaluation based on the case studies analyzing construction drawings and specifications of public multifamily housing projects delivered through the DB and DBB methods since 2000. The Delphi and analytic hierarchy process methods were used to develop objective standards and contents for evaluating the design performance. An analysis of variance test was conducted to analyze which delivery methods would have an effect on the design performance. Construction industry practitioners can use the results of this study in selecting a delivery method appropriate to the project characteristics.     

Comparative Analysis of Project Delivery Systems Cost Performance in Pacific Northwest Public Schools

Alternative project delivery systems such as construction management at risk (CMR) are increasingly used in public school construction in the United States. CMR is expected to benefit owners with a guaranteed maximum price (GMP), decreased change order cost, and increased cost “certainty.” This paper empirically compares cost growth performance of the CMR and design-bid-build (DBB) methods in Pacific Northwest public school projects. Data were collected from state records and previous studies on 297 completed schools in Oregon and Washington. The analysis of the data shows no statistically significant difference between CMR and DBB in construction change order costs, school project costs exceeding the GMP in 75% of the cases, and a statistically significant difference in cost growth between CMR and DBB projects during buy out, making CMR projects less efficient at controlling cost growth at buy out. These results counter some of the traditional expectations of the CMR delivery method.     

Procurement of Design-Build Services: Two-Phase Selection for Highway Projects

In the United States, public agencies are adopting the design-build (DB) delivery method for delivering highway projects after having used the traditional design-bid-build method for generations. In the 2002 design-build contracting final rule, the Federal Highway Administration (FHWA) strongly encourages the use of two-phase selection procedures for DB procurement. This paper takes a case study approach to investigating the use of a two-phase process for selecting providers of highway design-build services. Using two DB projects in central Texas as case studies, the writers have analyzed project documentation and performed interviews with 37 project participants involved in procurement, including owner representatives and legal consultants. For the first case, the writers selected the $1.3 billion SH-130 tolled expressway project in central Texas. Procurement of the SH-130 DB contract was performed before the FHWA rule on DB contracting was released. In addition, the writers examined procurement activities for the $154 million DB contract for the SH-45 SE tolled expressway, which was procured by the same owner in 2004 following procedures identified in the FHWA rule. As a result, a process was developed that included activities to be performed between the delivery method decision and the contract execution. This process model tracks the differences between the SH-130 and the SH-45 SE processes that are attributable to the latter’s adoption of the FHWA Rule.     

Construction Engineering—Reinvigorating the Discipline

Construction engineering is all about production, and producing something useful is the very reason for projects to exist. How then to explain why construction engineering has progressively fallen out of focus in construction project management education and research? For an answer, the development of the discipline of construction management since the 1950s must be understood, a development that yielded a non-production-oriented approach to project management, one that provides the currently accepted operating system for managing the work in projects. This paper first traces the history of the development of the traditional operating system and related commercial terms and organizational practices. It argues that traditional practices rest on an assumption that careful development of a project schedule, managing the critical path, and maximizing productivity within each activity will optimize project delivery in terms of cost and duration. Subsequently, an alternative operating system, developed and proposed by the Lean Construction community, is described. In contrast to the traditional approach, lean defers detailed planning until closer to the point of action, involves those who are to do the work in designing the production system and planning how to do it, aims to maximize project performance (not the pieces), and exploits breakdowns as opportunities for learning. The history of this development will be traced in broad strokes.     

Communicating Design Quality Requirements for Public Sector Design/Build Projects

This paper reports the results of a research study focused on how public sector owners articulated the requirements for design quality management in design/build (DB) projects. The research used the content analysis of 75 DB requests for proposals located in 35 states with an aggregate contract value of over $700 million with the mean price per project at roughly $15 million. The projects came from seven federal agencies as well as several state agencies. It found public owners are not availing themselves of the opportunity to evaluate design-builder design quality management plans and are primarily relying on the qualifications evaluation process to ensure design quality requirements will be met. Additionally, virtually all of the public owners in the sample neglected to require constructability reviews as a design quality management requirement in spite of the published benefits of this type of review. Finally, the paper concludes this area is one where a great deal of improvement for practitioners remains and the reason for a lack of focus on design quality in DB projects is due to a failure to shift the owner’s procurement culture from traditional project delivery to DB.     

Using Benchmarks and Metrics to Evaluate Project Delivery of Environmental Restoration Programs

The United States is in the middle of a large environmental restoration effort that is hampered by a lack of knowledge on how to measure the performance of the project delivery process. This study evaluates one environmental restoration program’s ability to deliver projects: the Environmental Management Program (EMP), a federally sponsored program managed by the U.S. Army Corps of Engineers. Project performance metrics are compiled and used to measure two types of program improvements made in project delivery: trend improvements over time, and the ability to reach established benchmarks. The benchmarks come from both agency guidance and construction industry benchmarks. The metrics measure the program’s ability to accurately estimate the required resources (time and money) to accomplish the project, estimate the cost to operate and maintain the project, and meet the customers’ design requirements. To build the metrics, estimates from the project planning documents are compared against the actual results. Currently, the Corps of Engineers has established some benchmarks and does evaluate projects for design success, but the benchmarks do not include all aspects of project delivery and are not universally applied. Analysis of the metrics shows that the Corps has made improvements in the delivery of projects, but some major components of the process should be improved. Establishing benchmarks would provide the Corps with information to improve the project delivery of the EMP and other environmental restoration programs across the country. This study provides an example of applying business principles to a governmental program.     

Project Delivery Systems and Project Change: Quantitative Analysis

Design/build has become one of the favored project delivery methods in the engineering construction industry. Numerous studies have advocated the use of design/build over the traditional design/bid/build delivery approach. A comprehensive analysis of 67 global projects from the Construction Industry Institute's database shows that design/build projects may not provide all the benefits to project performance. The study found timesaving was a definitive advantage of design/build project delivery, but, the positive effects of cost and productivity changes were not convincing. Based on the results of the study, the project management expertise and experience of the contractor may have a greater impact on project performance outcomes than focusing on project delivery strategy only.     

Partnering Process Model for Public-Sector Fast-Track Design-Build Projects in Korea

The use of design-build project delivery in the public sector has increased rapidly since the early 1990s due to its advantages over traditional delivery methods, particularly in terms of shortening the overall project duration. Fast-track approaches are being applied to design-build projects to achieve the optimum schedule durations. While both fast-track projects and design-build project have been researched separately in the past, there is little published research on how they are truly integrated. Likewise, the research has shown the merits of partnering in design-build and fast-track projects separately, but not in an integrated model. The purpose of this study is to develop a fast-track partnering process model (FTPPM) that combines the fast-track approach with the partnering concept. The model is based on the analysis of the factors that influence successful fast-track processes. Seven key success vehicles were discovered using the factor analysis method. The FTPPM is composed of the preparation stage, the fast-track workshop stage, and the detailed design and construction stage. The activities for each stage for fast-track implementation are developed in consideration with seven key success vehicles for fast-track projects.     

Estimation of Cost Contingency for Air Force Construction Projects

Risk and associated cost overruns are critical problems for construction projects, yet the most common practice for dealing with them is the assignment of an arbitrary flat percentage of the construction budget as a contingency fund. Therefore, our goal was to identify significant variables that may influence, or serve as indicators of, potential cost overruns. We analyzed data from 203 Air Force construction projects over a full range of project types and scopes using multiple linear regression to develop a model to predict the amount of required contingency funds. The proposed model uses only data that would be available prior to the award of a construction contract. The variables in the model were categorized as project characteristics, design performance metrics, and contract award process influences. Based on the performance metric used, the model captures 44% of actual cost overruns versus the 20% captured by the current practice. Furthermore, application of the model reduces the average contingency budgeting error from 11.2 to only 0.3%.     

Strategies for Design-Build in Korea Using System Dynamics Modeling

Increasingly adopted by both public and private organizations, design-build (DB) has become a favored construction project delivery system, outperforming other systems in terms of cost, schedule, and quality. However, DB has been especially criticized by the public sector for practicing subjective evaluation, for requiring excessive resources, and for providing only limited accessibility to small and medium-sized contractors. In Korea, similar critiques have been raised, as these qualities have prevented public owners from benefiting from the potential advantages of DB. In order to address these challenging issues, the present research systematically analyzes the characteristics of the DB delivery system in Korea. Based on industry surveys and an extensive literature review, a qualitative system dynamics model is developed and used to propose and test hypothetical DB policy alternatives which are expected to enhance DB performance. Furthermore, after the appropriate customization processes, these research findings can also be applied to the industry settings of different countries.     

Reliability and Stability Buffering Approach: Focusing on the Issues of Errors and Changes in Concurrent Design and Construction Projects

This paper proposes a new buffering approach, reliability and stability buffering, as a means to reduce uncertainty caused by errors and changes, in particular, when concurrent design and construction is applied to an infrastructure project. The proposed buffering provides a proactive mechanism to protect the planned performance of a project with a flexibly located and systemically sized buffer. For its implementation, the reliability and stability buffering is incorporated into a dynamic design and construction project model, which simulates the impacts of errors and changes on design and construction performance and evaluates the effectiveness of the proposed buffers. Applying this buffering approach into the infrastructure project in Massachusetts, this paper concludes that (1) the amount of hidden errors and latent changes was reduced; (2) the flexibly located and distributed buffers helped identify the predecessors’ errors and changes in concurrent design and construction; (3) the impacts of hidden errors and changes were minimized, preventing their ripple effect on the succeeding activities; and (4) the quality of the coordination process was increased. Thus it shows great potential to protect design and construction performance against uncertainty in concurrent design and construction delivery of civil infrastructure projects. Such benefit obtained from the proposed buffering should be relevant to researchers and practitioners because it provides the base for future investigation for the strategic utilization of schedule buffers in an uncertain environment as well as the guideline for their effective use in practice.     

“Lean” Comparison Using Process Charts of Complex Seismic Retrofit Projects

This paper compares the delivery of two retrofit projects where seismic isolation bearings were installed. The comparison is retrospective. The design teams on these projects did not implement “lean” thinking to develop their approach, nevertheless, observed process differences are characterized using a “lean” process evaluation and optimization tool, and then gauged and rationalized from that perspective. Cross-functional process charts identify functional parties with interrelated material or information handoffs. They help to identify (un)necessary steps or complexity as measured by number of handoffs and interacting parties. Analysis of these charts shows that project value may stem from the owner integrating design development with product procurement and construction method selection. On one project, integration was made possible by structural engineers evaluating the impacts of product procurement on overall project performance, expert consultants providing construction process reviews, and experienced contractors participating in installation sequence development. This paper illustrates the value of developing a symbiotic relationship between designers and suppliers in a niche market. It stresses the need for work structuring early on in the delivery process, integrating process with product development, to improve project delivery.     

Cost Performance Comparison of Two Public Sector Project Procurement Techniques

Increased industry discussion of the potential benefits of alternative forms of construction project delivery often presents little cost analysis of options. This work presents the results of a cost comparison study of completed public sector municipal facilities design and construction projects—a portion of which delivered using a traditional design-bid-build procurement approach and a portion of which delivered using the procurement technique of a negotiated lump sum construction contracts with in-house construction forces. The study compares costs for all phases of all the projects (design, bid and award, construction, and total project cost) across both methods of project procurement. Conclusions examine the cost trade-offs of using negotiated contracts with in-house forces, outline key success factors identified through this study in order to optimize the use of this form of project procurement, and identify areas for future research.     

Alternative Delivery Approaches for Military Medical Construction Projects

Military medical construction projects take more than 10 years to complete, from the time the need for a new facility is identified until the building actually opens for occupancy. This time is often extended even further due to complications during the design and construction process. Furthermore, these projects often are completed well over their original budget. Although there are many reasons for this exorbitant amount of time and many causes for the budgetary problems, one of the major factors is the reliance on the traditional methods of a lump-sum contract and the design∕bid∕build project delivery approach. The writers illustrate how the use of alternative project delivery methods (specifically construction management and design∕build) can reduce the amount of time it takes to design and build a new military medical facility, as well as reduce the overall cost of the project. The advantages offered by these alternative delivery methods are set forth, and their applicability within the federal procurement process is discussed. Several recommendations are then given for using these methods for the design and construction of military medical facilities.     

Master Builder Project Delivery System and Designer Construction Knowledge

The master builder system for designing and building construction projects was the dominant project delivery system in the construction industry during the early part of the 20th century. Master builders were generally charged with both design and construction services for a project. During the last half of the 20th century, many different systems for project delivery with fragmented responsibilities have replaced the master builder system. Reducing the use of the master builder system has led to the creation of elaborate systems for managing projects in the construction industry. In order to investigate the use of the master builder delivery system and other systems, a research project was conducted that included reviewing (1) the history of the construction industry, (2) project delivery systems, (3) constructability issues, (4) construction industry fragmentation, (5) the results of a survey of architecture, engineering, and construction professionals from the San Francisco Bay Area in California on the current processes they use for training engineers and architects, (6) an analysis of the survey results, (7) construction industry recommendations, and (8) conclusions based on the survey results and analysis. The information obtained from the research project, including the survey and an analysis of the results, is included in this document. The results of the research indicate that reduction in the use of the master builder project delivery system and the rise of numerous fragmented delivery systems have limited the designer’s knowledge of construction processes.     

Reliability Buffering for Construction Projects

Buffering is a common practice in project planning. Project managers or schedulers have used a time contingency to guarantee the completion time of either an activity or a project. This traditional buffering, however, often fails to protect the project schedule performance, resulting in an unnecessary resource idle time. To deal with this problem, reliability buffering, a simulation-based buffering strategy, is presented. Reliability buffering aims to generate a robust construction plan that protects against uncertainties by reducing the potential impact of construction changes. The effectiveness of reliability buffering is examined by simulating a dynamic project model that integrates the simulation approach with the network scheduling approach. The research results indicate that reliability buffering can help achieve a shorter project duration without driving up costs by pooling, resizing, relocating, and recharacterizing contingency buffers. A case study of bridge construction projects also demonstrates how construction projects can benefit from reliability buffering in real world settings. Although further validation is needed, reliability buffering can potentially impact the planning and control of construction projects by improving the consideration of construction feedbacks and characteristics in buffering, and serving as an input to a dynamic project model.     

Resource Management of Bridge Deck Rehabilitation: Jacques Cartier Bridge Case Study

The condition and performance of bridges vary widely across North America. The large amount of expenditures on bridges needs significant efforts to optimize budget and resource allocation and to select the best rehabilitation or replacement method, which reduces project cost and duration. Simulation has been widely used in the construction area to optimize productivity and resource allocation. Current research optimizes resource combination for bridge deck rehabilitation projects using discrete event simulation. The Jacques Cartier Bridge redecking project is selected as a case study. Data related to productivity and duration of different activities were collected from the project. Probability distributions are fitted, which show the robustness of normal distribution to fit most variables. A simulation model is developed for this project in order to experiment with and perform sensitivity analysis. Based on the simulation results, an optimum resource combination of deck rehabilitation is obtained, which is [five teams, two saws, three old section trucks, and five new panel trucks] TSON 5235 with the unit (panel) cost of $747/h (direct cost only). The model developed is tested against real productivity where it shows reasonable results. The present research is relevant to both researchers and practitioners. It provides bridge redecking researchers with a real case study, a simulation model, and an approach to analyze projects. It also provides practitioners with an approach to optimize the usage of their resources considering direct project cost.