The entire construction industry is currently dealing with higher construction costs, project delays and low productivity coupled with the pressure of a weakened economy. In fact, the current construction industry’s productive time is only 43% in comparison to 88% in the Manufacturing industry.* Therefore, industry leaders are faced with a dilemma: how to decrease construction costs while continuing to create facilities that improve patient care.
Integrated Project Delivery (IPD) can be the solution to these problems.
Integrated Project delivery is a unique team structure based on a relational contract that promotes problem solving. The Owner, Designer, Construction Manager and Trade Experts are all part of the process from beginning to the end. As equal partners, all are engaged early in the process with the opportunity to share in the risk and rewards based on reaching their goals. This structure, enabling each aspect of the project to be evaluated in its entirety by all team members, allows the Owner to make informed timely decisions and eliminate duplicated efforts. The model is based on Lean Principles that originated in the manufacturing industry with the goal of giving customers a better product and delivering it quicker with minimal waste.
Team members that sign an Integrated Project Delivery contract must work under the following key principles:
By creating a relational contract, instead of transactional, the Owner, Contractor, Architect, Engineer, and major trades become a true team, sharing in the risk and reward.
An Integrated Project Delivery brings the following benefits to any project:
For example, at our project for BJC St. Peters we utilized this process. To confirm the owner was getting the best value, we sent out the project to contractors for bidding at the end of design development. Because our team had developed a substantial understanding of the work required and had devised ways to eliminate waste in the process, we were confident we would be lower. If the bids were lower than we had stated the project would revert to a traditional process with a new contractor. We were 15% lower at that time and we were able to create an additional 5% in savings during the remainder of the job.
*Source: Construction Industry Institute, 2004
