PROJECT DELIVERY METHODS

EFCA …•is the sole association representing the engineering consultancy and related services industry in Europe •represents 26 professional associations from 26 European countries•Represents FIDIC in Europe•aspires to positively influence EU legislation that impacts on the engineering consultancy•promotes fair competition and transparent procurement rules •is a network/business platform for member associations and European firms •requires all its members to comply with its Code of Conduct which governs the performance and quality of service offered by the member firms

Project delivery methods will affect our business

• Integrated project delivery methods bring new business opportunities for Engineering Consultants

• Engineering Consultants can play several roles in the extended supply chain

• But Engineering Consultants need more strength for higher and other risks

• The firms have to adapt to seize the opportunities!

Potential positions, roles and tasks in the supply chain

Standard project organisation for built assets

Variety of new project delivery methods for built assets

1. Traditional design-bid-build contracts

2. Integrated management contracts

3. Integrated design and engineering contracts

4. Integrated design and build contracts

5. Financed integrated design and build contracts

General remarks

Each project delivery method comes with specific contracts with variation on obligations, risks, liabilities and way of remuneration

Working for both clients and contractors in different project stages can easily result in a potential conflict of interests

Engineering Consultants have to cherish their position as trusted advisor to each client!

Characteristics of the various project delivery methods

1. Traditional Design-bid-Build Contracts

1. Traditional design-bid-build contracts

• Role(s): consultant and designer for the client, supervisor to the contractor

• Remuneration: fee based or lump sum• Expectation: trusted advisor, make your best effort,

minimize risk for the client• Liability: restricted, own risk low • Types of contracts: general contracting,

subcontracting, trade contracting

2. Integrated Management Contracts

2. Integrated management contracts

• Role(s): project manager, programme manager, budget and scope manager, client role to the subcontractors

• Remuneration: fee based, maximum amount• Expectation: delegated responsibility from the client,

minimize risk, delivery within scope, time and budget• Liability: restricted, own risk low • Types of contracts: Project management, Design

management, Construction management, Facility management, Programme management

3. Integrated Design and Engineering Contracts

3. Integrated design and engineering contracts

• Role(s): consultant and design integrator for the client, design manager and supervisor to the contractor

• Remuneration: lump sum, bonus/malus• Expectation: minimize risk for the client, fully

responsible for the design and construction management • Liability: less restricted, own risk high • Types of contracts: Management Contractor, Total

Engineering, Target Fee Contracting, PD/DM/CM

4. Integrated Design and Build Contracts

4. Integrated design and build contracts

• Role(s): project definition and procurement consultant for the client. Design partner or engineering subcontractor for the D/B Contractor

• Remuneration: fee based or lump sum. Often low margins with a win fee from the contractor

• Expectation: successful procurement for the client. Winning design for the contractor and predictable building costs

• Liability: restricted, normal risks• Types of contracts: Design Build, Alliancing, Turn

Key

5. Financed integrated Design and Build Contracts

5. Financed integrated design and build contracts

• Role(s): project definition for the client, consultant to the banks, design manager, facility manager, engineering subcontractor, etc.

• Remuneration: fee based, lump sum, dividend on own investment, service fee etc.

• Expectation: minimize risk for the SPV, fully responsible for the design, facility management, etc.

• Liability: less restricted, own money at risk. High procurement costs and risks

• Types of contracts: PPP, PFI, DBFM, DBFMO