Comparing Procurement Methods for Design-Build Projects

The design-build delivery method is increasingly used in the United States due to numerous advantages it can offer a project. An important issue associated with design-build delivery is the procurement method used to select the design-build team. It is a critical decision that involves several key project team members, including the owner, designer, and contractor organizations, and requires the owner to carefully choose the design-build procurement method that will be used to select the team that will deliver the project. This research quantitatively analyzed the correlation between the design-build procurement method and the performance of the design-build project with regard to cost, time, and quality metrics. The procurement methods studied were sole source, qualifications-based, best value, and low bid selection. Data were collected through surveys from 76 design-build projects in the United States. Based on the patterns and relationships identified from these data, a better understanding of the procurement process and how it influences project performance is achieved. The impact of project-specific factors and guidelines are presented to assist owners in selecting the design-build team procurement method that responds to their project goals.     

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%.     

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.     

Alternative Project Delivery Systems: Applications and Legal Limits in Transportation Projects

This paper presents the results of a comprehensive survey of the legal codes of all the 50 states in the United States regarding alternative project delivery systems in transportation projects. In the past decade there has been a surge of legislation allowing state transportation officials much more flexibility regarding the choice of project delivery systems. These delivery systems are usually selected based on a combination of price and quality. Specific delivery systems studied in this paper are Design-Build, Construction Management at Risk, and Public-Private-Partnership. The background and history of the emergence of these new delivery systems are studied in this paper. The research showed that in many states, alternative delivery systems may be allowed but with specific restrictions. For each state, all of these delivery systems have been researched and placed into one of the following distinguishable categories: (1) fully authorized; (2) authorized but needs extra approvals; (3) authorized for a pilot program and/or with some limitations; (4) not authorized. The output of the survey gives valuable snapshots over the status of each delivery system in regards to its legality in different parts of the country as of December 2006. Comparing the results of this survey with the surveys done previously shows that the trend is to allow states more flexibility in the choice of project delivery systems.     

Analysis of Federal Design-Build Request for Proposal Evaluation Criteria

This study’s objective is to identify the benefits federal owners are seeking through the design-build process by analysis of research data gathered from 110 requests for proposal (RFP) evaluation plans issued for $1.5 billion of federal work by 11 different agencies. The output from this study was then compared to a 1996 study whose authors sought to analyze the reasons cited by owners to use design-build project delivery. That study included a survey of 108 owners of public and private projects, which represented over $12.5 billion of construction. The goal of comparing the 1996 survey with the results of the new research project is to discover correlations between owner attitudes and the selection criteria identified in government RFPs. The comparison produced some interesting results. First, although owners in 1996 cited schedule as the most significant reason for selecting design-build delivery, the federal RFP content analysis found it to carry a very low average weight. Another finding shows that federal RFPs give price a very heavy weight in the government selection processes, again differing significantly from the previous survey of owner attitudes. Finally, the current study found that the qualifications of the firms and individuals that formed the design-build team were significantly more important than the proposed technical design approach. Thus, this paper concludes that the typical federal agency was looking for a low price from a well-qualified design-build team.     

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.     

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.     

Fall and Rise of the Largest Construction Manager-at-Risk Transportation Construction Project Ever

All parties agree that the Miami Intermodal Center (MIC) construction project got off to a bad start, but why did this project—so anxiously anticipated, so badly needed, and kicked off with such fanfare—seem destined for so long to be remembered as a high-priced failure? After the bad start, why did the MIC project seem to struggle so for almost four years before—seemingly all at once—finding direction? What were the factors behind the bad start? What were the factors behind the lack of progress once the project started? What were the factors behind a remarkable turnaround? This paper answers these questions and more. The product of four years of research and data gathering, this paper should be of use to researchers and practitioners. It uses dozens of interviews with project planners, Florida Department of Transportation administrators, and construction personnel, as well as pertinent data to tell the story of the first 5 years of the construction of this groundbreaking world-class multimodal facility that is estimated to take 15–20 years to construct and cost approximately $2.5 billion.     

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.     

Framework of Success Criteria for Design/Build Projects

Success has always been the ultimate goal of every activity, and a construction project is no exception. Due to the ambiguous definition of project success and the different perceptions of participants toward this concept, it may be difficult to tell whether a project is successful as there is a lack of consensus. Time, cost, and quality have long been the success criteria used to evaluate the performance of a construction project. However, such a list has been criticized as not being comprehensive. Even studies of the project success of a particular construction method, such as the design/build procurement system, are lacking in most previous research considering construction projects in general. This paper sets out to establish criteria for project success for a design/build project in construction, first by identifying relevant measures of project success for a construction project in past studies, with particular emphasis on design/build projects, and then by establishing a comprehensive assessment framework for project success for design/build projects. The significant impacts on the construction field of study, in terms of educational value and practical use, are also presented. With little research in the project success of design/build projects, the writers suggest a research focus for the study.     

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.     

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.     

Quantitative Methods for Design-Build Team Selection

The use of design/build (DB) contracting by transportation agencies has been steadily increasing as a project delivery system for large complex highway projects. However, moving to DB from traditional design-bid-build procurement can be a challenge. One significant barrier is gaining acceptance of a best-value selection process in which technical aspects of a proposal are considered separately and then combined with price to determine the winning proposal. These technical aspects mostly consist of qualitative criteria, thus making room for human errors or biases. Any perceived presence of bias or influence in the selection process can lead to public mistrust and protests by bidders. It is important that a rigorous quantitative mathematical analysis of the evaluation process be conducted to determine whether bias exists and to eliminate it. The paper discusses two potential sources of bias—evaluators and weighting model—in the DB selection process and presents mathematical models to detect and remove biases should they exist. A score normalization model deals with biases from the evaluators; then a graphical weight-space volume model and a Monte Carlo statistical sampling model are developed to remove biases from the weighting model. The models are then tested and demonstrated using results from the DB bridge replacement project for the collapsed Mississippi River bridge of Interstate 35W in Minneapolis.     

Educational Needs Assessment for Design/Build Project Delivery

With the rapid increase in the utilization of design/build project delivery, there arises a need for continuing education of the professionals in this industry. This paper describes research conducted through a national survey of owners, designers, and builders to determine the best course of action to address the continuing education needs of this industry. By modeling the design/build life cycle into six main phases of project initiation, risk allocation, performance specification, project planning, construction administration, and project closeout, the most critical educational areas are identified. The conclusion from this research is that the areas needing special attention are (1) benefits and cautions of delivery systems; (2) budget and contingencies; (3) owner’s objectives and needs; (4) cost estimating; (5) project timeline; and (6) cost and schedule control. A principal component analysis of the results discovered the following seven groupings of educational topics or “learning modules”: (1) the delivery decision; (2) estimating and scheduling during design; (3) proposal preparation and response; (4) contract fundamentals; (5) construction administration; (6) facilities commissioning; and (7) insurance and financing.     

Empirical Comparison of Design/Build and Design/Bid/Build Project Delivery Methods

This study compares the performance of design/bid/build and design/build to see if one project delivery method is superior in regards to time and cost. Similar military buildings were used to identify two samples of projects delivered with each of the two delivery methods. These projects provide a meaningful comparison because they include buildings of the same typology (i.e., U.S. Navy Bachelor Enlisted Quarters) delivered using similar design models. Project duration, project duration per bed, project time growth, cost growth and cost per bed were statistically compared. Upon completion of the analysis, the hypothesis that design/build projects are superior to design/bid/build projects in regards to time and cost was tested. Design/build projects were proven superior in performance in almost every measure. Other findings, including recommendations to practitioners and researchers, will be provided as well.     

Effects of Delivery Systems on Change Order Size and Frequency in Mechanical Construction

Change orders represent one of the largest sources of cost growth on building construction projects. Field generated, or “unforeseen” change orders can also be highly disruptive to field productivity. Design-build delivery methods can potentially help minimize change orders on construction projects. This study was performed to closely examine the effects of delivery methods on the frequency and magnitude of change orders in mechanical construction, and how design-build business practices can be used to minimize the frequency of field generated chance orders. In a study of 598 change orders occurring on 120 construction projects performed by the same contractor, the total number of change orders was found to be close to the same on design-build and design-bid-build projects, however an 87% decrease in the average number of unforeseen change orders was observed on design-build projects versus design-bid-build projects. In addition, the average size of unforeseen change orders was 86% smaller on design-build projects. A detailed and qualified presentation of the research methodology and resulting data is provided. Key attributes and business practices leading to the results are discussed and practical applications of this research for owners and contractors are provided.     

Forms of Collaboration and Project Delivery in Chinese Construction Markets: Probable Emergence of Strategic Alliances and Design/Build

Changes in regulations to allow foreign contractors to qualify as wholly foreign-owned “construction enterprises” came into effect in September 2002 as one of the steps taken by the Chinese government to honor its World Trade Organization commitments. Emerging markets have a significant impact on the strategic planning of contractors; based on an electronic survey covering foreign contractors, clients (foreign investors), and design institutes, the design/build procurement route in conjunction with strategic alliances has been found to enable foreign contractors to enter the Chinese marketplace. The writers present a strengths, weaknesses, opportunities, and threats (SWOT) analysis to inform readers where opportunities for development might be found and to warn of threats to entry. The research also found that mutual trust, synergistic strengths and complementarities, market demand for services, flexibility for both parties, and minimum change of top managers were ranked as the top five critical success factors for strategic alliances between foreign contractors and design institutes. Finally, medium-sized, state-owned, and large-sized design institutes were ranked as the first, second, and third preferences, respectively, for strategic partnering by foreign contractors.     

In-House Delivery of Multiple-Small Reconstruction Projects

As compared with new construction, reconstruction of operational facilities exhibits a higher challenge, particularly when multiple projects are involved. For owner organizations involved in such projects, use of in-house resources versus outside contractors has been a major dilemma, with each approach having its potential benefits. This paper uses a real-life case study approach to investigate the delivery of 800 small reconstruction projects using in-house forces. Details are described related to the prioritization, budgeting, organization structure, and the mechanisms used for staff allocation. It was found that the main characteristics of projects that are best delivered by in-house forces include high urgency and inadequate scope definition. Outsourcing this type of projects exposes the owner to a large number of changes and their consequent cost overruns/delays. Based on the case study, the challenges facing in-house delivered projects and the factors that contribute to their success were investigated and outlined. To verify the findings a questionnaire survey among similar organizations is conducted and its results discussed.     

Constructability State of Practice Report

This report reviews guidance on constructability programs from a variety of sources and presents the current practice of constructability. The advice of several organizations and researchers is summarized to describe expectations for ideal constructability. Actual current constructability practice, based on results and analysis of a Constructability State of Practice survey, is described. Approximately 100 owners, architects, engineers, consultants, contractors, and construction managers answered the survey’s ten questions and provided written comments. The results provide a picture of current constructability practices in the architecture, engineering, and construction (AEC) industry and progress in recent years. Major conclusions include: (1) constructability has gained acceptance throughout the industry; (2) constructability efforts are clearly beginning in early project phases; (3) a wide variety of constructability techniques and new technologies are being implemented; and (4) obstacles to improving constructability remain, but may be changing. Finally, recommendations are provided based on areas where constructability practice can still be improved. This report is relevant to both industry practitioners and researchers.     

Sensitivity of Construction Activities under Design Uncertainty

In the quest to shorten project delivery time, construction professionals have the option of overlapping design and construction activities. Although time savings can be achieved by overlapping, conducting design and construction operations in a nonnatural sequence can carry significant risks. To mitigate these risks and make more appropriate overlapping decisions, concurrent engineering concepts can be used to classify upstream design activities in terms of design evolution and downstream construction activities in terms of sensitivity to upstream design changes. The focus of this work is to determine the factors that contribute to the sensitivity of construction activities. A series of semistructured interviews with experienced construction professionals show that the level of transformation, lead time, modularity, and the interaction of built components are some of the factors that determine the amount of sensitivity in construction activities to upstream design changes. These determinants provide for a quick assessment of an activity’s sensitivity, which can help practitioners limit risk when planning the overlapping of design and construction activities.