Integrated project delivery!!Integrated project delivery (IPD), is a collaborative alliance of people, systems, business structures and practices into a process that tackle the talents and insights of all participants to optimize project results, increase value to the owner, reduce waste, and maximize efficiency through all parts of design, fabrication, and construction. IPD is emerging as the way to organize project teams to achieve lean construction at a time when the industry is searching for ways to eliminate waste, cut costs, improve productivity, and create positive outcomes. This approach to project delivery does just as the name implies by integrating all team members--owner, architect, construction manager, engineers, and subcontractors--to form a collaborative effort.! !IPD uses a three-pronged platform with the owner as one entity, the architects and engineers as the second, and the contractors or builders as the third. The owner, architect, and contractor act as the core group to manage the integrated project delivery process. Despite emerging shortly before the economic downturn that saw the building sector dive into a prolonged tailspin, Integrated Project Delivery (IPD) appears to have weathered the storm. Forty percent of AIA members demonstrate understanding of this emerging collaborative delivery method, and 84 percent are aware of its market presence, according to a recent survey commissioned by the AIA Center for Integrated Practice. Despite emerging shortly before the economic downturn that saw the building sector dive into a prolonged tailspin, IPD appears to have weathered the storm. Forty percent of AIA members demonstrate understanding of this emerging collaborative delivery method, and 84 percent are aware of its market presence, according to a recent survey Commissioned by the AIA Center for Integrated Practice. (Figure 1)!

Fig. 1!

IPD is a latest delivery model based on lean construction principles. It adds value through maximizing efficiency and collaboration of all project team members (owner, A/E, builders, trade contractors, facility managers and end users). Owners select team members based on technical expertise and teamwork, forming a truly collaborative environment in which risks and rewards can be shared among team members. IPD also integrates trade contractors’ expertise into the design effort through a competitive and value-based procurement process. This team collaboration results in building designs based on actual equipment and systems, superior construct-ability reviews, and information prior to construction implementation documents. Team-wide use of technology, as in other delivery methods, is integral to the successful implementation of IPD. Building information modeling (BIM) and virtual design and construction (VDC) methods centralize data collection and dissemination, resolve conflicts between systems prior to construction to reduce risk, and gain efficiencies to the project.!!The principles can be applied to a variety of contractual arrangements and IPD teams will usually include members well beyond the basic triad of owner, designer and contractor. At a minimum, though, an integrated project includes tight collaboration between the owner, architect/engineers, and builders ultimately responsible for!construction of the project, from early design through project handover. !!It uses!business structures, practices, and processes to collaboratively use the talents and!insights of all participants in the design, construction and fabrication process. Beginning when the project is first conceptualized, the integrated process continues throughout the full life!cycle of the facilities. It also encourages early contribution of knowledge and experience and requires proactive involvement of key participants. Responsibility is placed on the most able person with decisions being made on a “best for project” basis. Although it is possible to achieve IPD without Building Information Modeling, it is the opinion and recommendation of this study

that Building Information Modeling is essential to efficiently achieve the collaboration required for IPD.!!Member interest in alternative delivery methods is high. More than half of respondents have engaged in some degree of collaborative project delivery. Although IPD is the least c o m m o n l y u s e d ( 1 3 p e r c e n t ) alternative delivery method, it is also the most recent. (Figure 2) By c o m p a r i s o n , 5 1 p e r c e n t o f respondents indicated that they have completed a project within the last two years using design-build, a contract type popular for more than 15 years. Forty-two percent reported using Construction Manager as Constructor.!!!!

!! ! Fig. 2!

The IPD process leverages the experience, talent, and input of all team members in order to obtain the best results and increase value for the owner by reducing waste and maximizing efficiency throughout the life cycle of the project from design and fabrication to the completion of construction. As a result, IPD produces shorter delivery times than traditional practices, such as design-bid-build. The integrated approach is well-suited for projects being done in the private sector or for non-profit institutions. However, public entities in most states, such as educational !

Fig. 3!!institutions, cannot use IPD due to the state-legislated bidding process. In addition to being highly collaborative and seeking input from project team members at the onset of the project, IPD allows member companies to leverage Building Information Modeling (BIM) by creating a virtual design of every element of a construction project’s process. (Figure 3)!!IPD beyond healthcare!!Healthcare facilities are the most common projects where IPD is applied, with 24 percent of respondents working in this sector. (Figure 4) High-profile projects like NBBJ’s Seattle Children’s Bellevue Clinic have emphasized IPD’s ability to maximize design value while fast-tracking construction and minimizing costs, making it an appealing option for healthcare owners.!!

Interestingly, the second most common construction type delivered by respondents that use IPD are single-family homes, at 14 percent. Although these numbers do not necessarily mean !

Fig. 4!!Single-family residential projects are explicitly being delivered through IPD, they do run counter to two commonly perceived barriers to adopting collaborative delivery: that a firm is too small or its projects lack complexity. Rounding out the top five project types delivered by respondents using IPD are government buildings (12 percent), education facilities (12 percent), and office space (10 percent).!!Barriers to IPD!!One perennial challenge for architects interested in adopting collaborative delivery methods is their inability to require contractual collaboration and multiparty contracts. Although architects can implement behavioral transformations themselves, and make recommendations to owners, the responsibility of selecting a delivery method is ultimately held by the client. Indeed, “Owner does not see advantages” and “Owner resistant to change” were (respectively) the first and third most significant barriers to engaging in integrated practice. “General lack of precedent” was identified as the second most significant barrier. (Figure 5)!!Among respondents who had completed IPD projects, owner issues remained the most significant barriers to pursuing IPD. Likewise, other external considerations, including “procurement method limitations/restraints,” “general lack of available, appropriate insurance,” and “general lack of insurance support” remained barriers, and saw the slimmest decreases from those unengaged in IPD.!

The more significant difference in perceived barriers by respondents engaged in IPD and those not engaged highlights the capabilities of architects to thrive in a collaborative environment. Fig“General lack of precedent,” the second most significant barrier overall, sees the most !

Fig. 5!!substantial drop between the two demographics, followed by “my firm lacks the necessary skills/knowledge,” “licensing and liability concerns,” and “uncertain about risk management in IPD.” Less than 12 percent of respondents who have completed an IPD project considered any of these to be a major barrier to adopting IPD.!!Main sequential phases to the IPD method!!1. Conceptualization phase [expanded programming]!2. Criteria design phase [expanded schematic design]!3. Detailed design phase [expanded design development]!4. Implementation documents phase [construction documents]!5. Agency review phase!

6. Buyout phase!7. Construction phase!8. Closeout phase!9. Facilities management!!The role of technology in IPD!!The adoption of IPD as a standard for collaborative good practice on construction projects presents its own problems. As most construction projects involve disparate stakeholders, traditional IT solutions are not conducive to collaborative working. Sharing files behind IT firewalls, large email attachment sizes and the ability to view all manner of file types without the native software all make IPD difficult.!!The need to overcome collaborative IT challenges has been one of the drivers behind the growth of online construction collaboration technology. Since 2000, a new generation of technology companies evolved using SaaS to facilitate IPD in a smooth and efficient manner.!!This collaboration software streamlines the flow of documentation, communications and workflows ensuring everyone is working from 'one version of the truth'. Collaboration software allows users from disparate locations to keep all communications, documents & drawings, forms and data, amongst other types of electronic file, in one place. Version control is assured and users are able to view and mark up files online without the need for native software. The technology also enables project confidence and mitigates risk thanks to inbuilt audit trails.!!IPD Tools!!Target Value Design plays an integral role in IPD. First, the integrated team verifies that a particular facility can be built with available funds working within market constraints. The IPD team then establishes a target cost based on innovative thinking and best practices, and designs to that target.!!The cardinal rule of Target Value Design is that the target cost of a facility can never be exceeded. Teams composed of architects, engineers, and contractors design to a specific target cost. The target costs are established for all relevant areas of a project, including the building envelope, interior/finishes, vertical transportation, material handling, site improvements, structure, and mechanical, electrical, and plumbing. The targets are adjusted up and down to maintain the project target cost. If any savings result, it is shared by the team and the owner.When using relational contracts, the team sets the target cost very early and designs to that goal. The team’s incentives are based on the estimated maximum price or the GMP.!!The Last Planner System is also an innovative tool that works well on integrated delivery projects to create reliable work flow. This is achieved by pulling work, not pushing it based on a predetermined schedule. That is, the team members plan and produce only what is needed for delivery of the product at every point. Production is also shielded from uncertainty by putting only activities on the weekly work plan that team members know are ready and can be completed as planned. It also utilizes various levels of planning, controlling, and correcting. Milestones and long leads are identified during strategic planning. Detailed planning continues until reliable promises are made and work assignments are given. The system helps team members gauge their achievements and learn from plan failures.!

CHARACTERISTICS OF IPD!!IPD encourages early contribution of knowledge and experience and requires proactive involvement of key participants. Responsibility is placed on the most able person with decisions being made on a“best for project” basis. Although it is possible to implement IPD without Building Information Modeling (BIM: discussed hereinafter), it is essential to efficiently achieve the collaboration required for Integrated Project Delivery (AIA et al., 2007).IPD is built on collaboration. As a result, it can only be successful if the participants share and apply common values and goals. IPD is a method of project delivery distinguished by a contractual arrangement among a minimum of the owner, constructor and design professional that aligns business interests of all parties. IPD motivates collaboration throughout the design and construction process,tying stakeholder success to project success, and embodies the following contractual and behavioral principles (AIA and AGC of America, 2011).!!Contractual Principles!!1. Key Participants Bound Together as Equals!2. Shared Financial Risk and Reward Based on Project Outcome!3. Liability Waivers between Key Participants!4. Fiscal Transparency between Key Participants!5. Early Involvement of Key Participants!6. Jointly Developed Project Target Criteria!7. Collaborative Decision Making!!Behavioral Principles!!1. Mutual Respect and Trust!2. Willingness to Collaborate!3. Open Communication!!Key principles of IPD include:!!1. Collaborative innovation and decision-making!2. Mutual respect and trust!3. Open and enhanced communication!4. Early involvement of key participants!5. Intensified planning pre-construction management!6. Design Assist!7. Appropriate use of technology (BIM, iBuild)!8. Optimizing effectiveness and efficiency throughout project life-cycle!9. Continuous process improvement!!Difference between IPD and other Procurement methods!!Understanding of the differences of IPD from the other systems is imperative in understanding the preparedness of an industry for its integration. !Table 1 presents a comparison between IPD and Traditional Procurement Methods.!!!

Table 1: IPD and Traditional Project Delivery – a comparison

Integrated project delivery provides some advantages over other methods of design-build for an owner who desires and is able to participate in the design and construction decision-making process. The owner is involved in all relevant communication and is able to advocate its interests before decisions are finalized. The corresponding danger, however, is that an owner may have insufficient experience or resources to participate usefully, and may slow down the process or adversely affect the decisions made. Rather than simply establishing performance criteria and requiring the design-build team to achieve them, the owner’s involvement in the process may provide a defense to the design-build team if the criteria are not met.!!A more radical form of integrated project delivery, practiced primarily in Australia, is “alliance contracting.” This approach involves sharing financial risks and rewards in lieu of attempting to establish legal responsibility for failure. All of the major parties to a construction project, including not only the owner, design professional and contractor, but also consulting engineers and major subcontractors and suppliers, bind themselves to a compensation formula that depends almost exclusively on mutually established criteria for project performance, which results in the entire team sharing bonuses for meeting or exceeding criteria and losses for failing to do so—regardless of the reasons for project success or failure. This structure is an attempt to distance project outcome from the finger-pointing that commonly results from typical Anglo-American rules for culpability and proximate cause, instead substituting teamwork and joint dedication to achieving the project criteria, regardless of attribution of fault or credit. Alliance contracting requires a great deal of trust among project participants, probably cemented by long-standing working relationships, and there is not yet sufficient data to predict its applicability to or likely success in the American construction market.!!Advantages!!1. Architect and contractor act as one firm, with key subcontractors as early part of team.!2. Experts in design and construction contribute to all phases of the project.!3. Delivery relationship changes from adversarial to collaborative.!4. Complete continuity of preferences and objectives throughout design and construction.!5. Win-win process whose economics encourage participation by quality firms.!6. Collaboration in design phase leads to innovation and reduced cost of 10-20% below DBB.!7. Delivery of project within budget with reduced likelihood of cost increases or overruns and

fast-tracking without losing control.!8. No need for a cumbersome bidding or RFP process, but typically “open books” for trades.!9. Avoidance of “lowball bidding” where the contractor wins the project by bidding below actual

cost, counting on change orders and claims to make a profit.!10. Improved and more efficient administration of construction due to absence of adversity

between the architect and contractor.!11. Single point responsibility for the project, with the project team accepting responsibility for

functional problems without the owner having to adjudicate finger-pointing among project participants.!

12. Works very well with the integration of BIM and third party verification of sustainable building goals.!

13. Schedule optimization, eliminates schedule waste.!14. Reduced project costs, through schedule optimization/refined coordination.!15. Increased team communication, collaboration and cohesion.!16. Higher quality facilities based on a common goal and increased collaboration with trades.!17. Safer job-site through better understanding of workflow by all.!

18. Increased productivity: Less time lost waiting for documentation and Shop drawings can be included in construction model. !

19. Better coordination of documents. !20. Fewer RFI’s and conflicts. !21. More informed decision making. !22. Better project cost control. !23. Improved budget management. !24. Higher predictability of outcomes. !25. Greater understanding and control over the construction process.!26. The owner gains all the advantages of DB or CMAR !27. The entire team’s interests are aligned with the project goals making the chance of success,

once underway, extremely high.!!Disadvantages!!1. New delivery method.!2. Requires very involved owner.!3. Some contractual issues to be addressed.!4. Qualification - based selection requires more owner effort.!5. Limited control of designer by owner.!6. Sometimes multiple solutions must be evaluated.!7. Today, limited case law.!8. Today, limited practical experience for both owners and industry.!9. Make scope changes during the selection process.!10. Force IPD teaming arrangements.!11. Focus on low initial prices.!12. Request best and final prices.!13. Insist on submittals and shop drawings.!14. Hold numerous status meetings and reviews.!15. Select a firm with insufficient financial strength.!16. Actual agreement on the criteria and the final IPD contract can be very difficult and can take

an inordinate amount of time and effort, for which the owner may be paying, if not in money then in time.!

17. Industry inexperience with working in non-adversarial team relationships makes the chance of failure most dependent on the behavior of individuals within the team. Damaging behavior is very difficult to control or to correct and can cause the breakdown of collaborative processes that are critical to success.!

18. Objective selection of the team is very difficult to achieve and can rely on little more than instinct for an owner who does not already have a team or teams that it knows and works with well.!

19. While team members are paid at cost for the work they do, prediction of and control of the effort comprising “cost” is difficult at the time the team is selected and even after the contract with fully agreed criteria is executed.!

20. IPD contracts have not yet been tested in law, so the result of a failure within the team is unpredictable.!!

Guidelines!American Institute of Architects - IPD Guide Attached along with a sample IPD Report!