Transcript Traditional: Design-Bid

Your Deliver Method...
…Pick it Early
http://www.caccfc.org/Events/Annual_Conference_03/Your%20Delivery%20Menthods%20Rev%203.ppt
Owner and General Contractor
Responsible for
ESH compliance
Owner and Multiple Primes
option 1
Each responsible for
ESH compliance
A/E-Architect/Engineer
CM- Construction Management Co
PD-Project Development
Owner and Multiple Primes
option 2
Make 1 Prime
contractor responsible
for site ESH (lead)
A/E-Architect/Engineer
CM- Construction Management Co
PD-Project Development
Owner and Construction Mgmt
CM is responsible for
overall site ESH compliance
Construction
Construction
Mgmt
Manager
Construction
Manager
What is an Owner Controller
Insurance Program or OCIP
Owner purchases the insurance
A centralized and controlled:
for a specific construction project,
as opposed to traditional method
• Insurance
of contractors purchasing their
• Loss Control/Safety
own
Coverage for that single project.
• Claims Management
Coverage includes:
Project Professional Liability,
• program purchased by
General Liability,
Owner covering all
Excess
Liability,
contractors and
Environmental Liability,
subcontractors of every tier
Builder’s Risk
Benefits include:
Who’s covered? Owner,
Reduced insurance costs
construction managers,
Broader and tailored coverage
general contractors, all
Uniformity and adequacy of coverage for all
subcontractors
contractors and subcontractors
Remove barriers of insurance for smaller, DBE firms
Higher limits of liability
Insurance costs fixed for the term of the project
Overview
• Project Delivery Methods
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Design–Bid–Build
CM At-Risk
Multi-Prime (Trade Contracting)
Design-Build
Contractual Relationships
Scope, Cost & Time Impacts
Risk
Pros & Cons
Project Elements
SCOPE
Project
Success
COST
TIME
Project Delivery Methods
• Design-Bid-Build
• CM At-Risk (CM/GC)
• Trade Contracting/Multiple Prime
• Design-Build
Traditional: Design-Bid-Build
Ownership
OWNER
Management
Primes
Designer
Contractor
Subs
Subcontractors
Contracts
Communication
Traditional: Design-Bid-Build
Ownership
OWNER
Management
Primes
CM
Designer
Contractor
Subs
Subcontractors
Contracts
Communication
Traditional: Design-Bid-Build
• Three sequential phases
Design
Bid
Build
• Four prime players
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Owner
Construction Manager
Architect
Contractor
• Three separate prime contracts
Traditional: Design-Bid-Build
• Process
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Owner selects CM & Architect
Architect designs project
CM provides management & support
Owner, CM & Architect publicly bid a
single prime contract
Contract awarded to low bidder
General Contractor constructs project
General Contractor manages subcontractors
CM & Architect provide oversight
CM at Risk (CM/GC)
OWNER
Ownership
Management
Primes
Designer
CM@R
Subs
Subcontractors
Contracts
Communication
CM at Risk (CM/GC)
• Three sequential phases
Design
Bid
Build
• Three prime players
• Owner
• Architect
• At-Risk CM (General Contractor)
• Two separate prime contracts
• Price Guarantee Point Varies
CM at Risk (CM/GC)
• Process
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Owner selects Architect & CM@R
Architect designs project
CM@R provides support
At some point GMP defined
(At-Risk relationship established)
Owner & CM@R publicly bid multiple
trade contracts (sub-contractors)
Contracts awarded to lowest bidders
Owner assigns contracts to CM@R
CM@R manages construction
Architect provides oversight
Multiple Prime (Trade Contracting)
OWNER
Ownership
Management
Primes
CM
Designer
Trade/Multiple Prime
Contractors
Subs
Contracts
Communication
Multiple Prime (Trade Contracting)
• Three sequential phases
Design
Bid
Build
• Three prime players
• Owner
• Architect
• Construction Manager
• Multiple Prime Contracts
• Architect & Construction Manager
• Prime Trade Contracts (Sub-Contractors)
• All contracts with Owner
Multiple Prime (Trade Contracting)
• Process
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Owner selects CM & Architect
Architect designs project
CM provides management & support
Owner & CM publicly bid multiple
trade contracts (sub-contractors)
• Contracts awarded to lowest bidders
• CM manages construction
• CM & Architect provide oversight
Design-Build
OWNER
Ownership
CM
Management
Primes
Design
Build
Entity
Scoping
Architect
Subs
Designer
Contracts
Builder
Communication
Design-Build
• Three continuous phases
Scoping
Documents
Select
D/B
Design
Build
• Four prime players
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Owner
Construction Manager
Scoping Architect
Design- Build Contractor
• Three separate prime contracts
Design-Build
• Process
• Owner selects CM & Scoping Architect
• Owner, CM & Architect develop scoping
documents (Bridging Documents)
• Selection of Design-Build Entity
• D/B completes design of project
• Owner approves design and authorizes
construction
• D/B secures sub-contractors
• D/B manages construction
• CM provides oversight
Items for Consideration
• Change Orders
• Price Confirmation
• Risk for:
• Cost
• Time
• Quality
• Control of
• Cost
• Time
• Quality
Questions?
Traditional: Design-Bid-Build
• Pros
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Most common method
Best understood
Most well-established law
Considered best design quality
Considered lowest initial cost
Fairest to bidders, level playing field
• Cons
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Low Bid Contractor
Generally slowest method
High change order costs
High litigation
CM at Risk (CM/GC)
• Pros
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GC selected (as CM) on qualifications
Design assistance reduces E&O
GMP approach reduces COs
Reduces claims
Owner knows costs up front
• Cons
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Not time tested in Public projects
Some jurisdictions not authorized
CM has normal GC conflict of interest
No CM advise during construction
Multiple Prime (Trade Contracting)
• Pros
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CM remains in fiduciary role
More project control
Fast track by major trades
Clearly identifies sub costs
Encourages small local contractors
Reduces bid claim potential
• Cons
• Multiple contracts are burdensome
• Lacks a single point of responsibility
• More control = more liability
Design/Build
• Pros
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Single point responsibility
Tends to be fastest method
Avoids E&O liability issues
Maximum transfer of risk
• Cons
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Requires increased owner sophistication
No normal architect advocacy
Design quality may be compromised
Reduces design input by Owner
Your Deliver Method...
…Pick it Early
Doug Evans
Vice President
Vanir Construction Management