Project delivery methods defines the characteristics of how a construction project is designed and built and the responsibilities of the parties involved in the construction (owner, designer and contractor). They are used by a construction manager who is working as an agent to the owner or by the owner itself to carry-out a construction project while mitigating the risks to the scope of work, time, budget, quality and safety of the project. These risks ranges from cost overruns, time delays and conflict among the various parties.
History
Trends in delivery methods Though DBB is now used for most private projects and the majority of public projects, it has not historically been the predominant delivery method of choice. The master builders of centuries past acted both as designers and constructors for both public and private clients. In the United States, Zane's Post Road in Ohio and the IRT in New York City were both originally developed under more integrated delivery methods, as were most infrastructure projects until 1933. Integrated Project Delivery offers a new delivery method to remove considerable waste from the construction process while improving quality and a return to more collaborative methods from the past. In an effort to assist industry professionals with the selection of appropriate project delivery systems, construction management researchers have prepared a Procurement Method and Contract Selection Model, which can be used for high level decision making for construction projects on a case-by-case basis.
Types Common project delivery methods include:
Design-Bid-Build (DBB) or Design-Award-Build (DAB) In Design-Bid-Build, owner develops contract documents with an architect or an engineer consisting of a set of blueprints and a detailed specification. Bids are solicited from contractors based on these documents; a contract is then awarded to the lowest responsive and responsible bidder. This is the traditional model for public sector infrastructure projects.
DBB with Construction Management (DBB with CM) DBB with Construction Management is a modified version of the Design-bid-build approach With partially completed contract documents, an owner will hire a construction manager to act as an agent. As substantial portions of the documents are completed, the construction manager will solicit bids from suitable subcontractors. This allows construction to proceed more quickly and allows the owner to share some of the risk inherent in the project with the construction manager.
Design-Build (DB) or Design-Construct (DC) In Design-Build, an owner develops a conceptual plan for a project, then solicits bids from joint ventures of architects and/or engineer and builders for the design and construction of the project. This is an alternative to the traditional model for public infrastructure projects that does not involve Private Financing.
Design-Build-Operate-Maintain (DBOM) DBOM takes DB one step further by including the operations and maintenance of the completed project in the same original contract
Integrated Project Delivery (IPD) Integrated Project Delivery seeks to involve all participants (people, systems, business structures and practices) through all phases of design, fabrication, and construction, with the goal of improving project efficiency and reducing "waste" in project delivery (i.e. any processes that do no directly add value to the final product). IPD is closely associated with the philosophy of Lean construction.
Job Order Contracting (JOC)
A form of Integrated Project Delivery (IPD) specifically for repair, renovation, maintenance, sustainability, and "minor" new construction. Each job order contract uses a Unit Price Book for pricing each job via a multi-year umbrella contract.
Public-private partnership (PPP, 3P, or P3) A public–private partnership is a cooperative arrangement between one or more public entities (typically the owner) and another (typically private sector) entity to design, build, finance, and at times operate and maintain, the project for a specified period of time on behalf of the owner. A minima, public-private partnership refers to the idea of cooperation between the public sector and the Private sector. The following models are usually used for P3 projects, though they are also sometimes used for private sector projects.
Build-Finance (BF) The private actor builds the asset and finances the cost during the construction period, afterwards the responsibility is handed over to the public entity. In terms of private-sector risk and involvement, this model is again on the lower end of the spectrum for both measures.
Build-Operate-Transfer (BOT) Build-Operate-Transfer represents a complete integration of the project delivery: the same contract governs the design, construction, operations, maintenance, and financing of the project. After some concessionary period, the facility is transferred back to the owner.
Build–own–operate–transfer (BOOT) A BOOT structure differs from BOT in that the private entity owns the works. During the concession period, the private company owns and operates the facility with the prime goal to recover the costs of investment and maintenance while trying to achieve a higher margin on the project. BOOT has been used in projects like highways, roads mass transit, railway transport and power generation.
Build–own–operate (BOO) In a BOO project, ownership of the project remains usually with the project company, such as a mobile phone network. Therefore, the private company gets the benefits of any residual value of the project. This framework is used when the physical life of the project coincides with the concession period. A BOO scheme involves large amounts of finance and long payback period. Some examples of BOO projects come from the water treatment plants.
Build–lease–transfer (BLT) Under BLT, a private entity builds a complete project and leases it to the government. In this way the control over the project is transferred from the project owner to a lessee. In other words, the ownership remains by the shareholders but operation purposes are leased. After the expiry of the leasing the ownership of the asset and the operational responsibility is transferred to the government at a previously agreed price.
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