Weighing the Design-Build Benefits

• By Julie Sturgeon
• 07/01/06

Richard Belle may not be able to pinpoint how many colleges and universities take a design-build route for their construction projects, but he has a solid answer nonetheless: lots.

As vice president of Public Affairs and Information for the Design-build Institute of America based in Washington, DC, Belle has at his fingertips the most comprehensive statistics compiled on the subject. Currently, 30 to 40 percent of all non-residential construction in the country uses this delivery process, which, he is quick to point out, is a dramatic jump from the single digits the industry saw just two decades ago. He anticipates design-build will account for 50 percent of projects within this decade.

“My guesstimate is that within the national 40 percent, in education it’s probably at that mark or higher,” he says.

The advantages of design-build are especially compelling at institutions where stringent local budget issues and an increase in student population exist. But no one would argue it’s limited to just those circumstances.“Design-build is rapidly increasing in just about every market sector that we know of,“ reports Richard S. Thomas, manager director of 2enCompass, an integrated design and construction company in Cincinnati. “They’re delving into this with gusto.” He predicts the industry’s market share will climb close to 60 percent over the next five to 10 years.

This phenomenon is basically a procurement method, where one entity or consortium is contractually responsible for both design and construction of a project. And it’s not exactly new, points out Keith Molenaar, an association professor in the Construction, Engineering and Management program at the University of Colorado. Scholars have traced its roots back to ancient Mesopotamia and the master builder concept that built the great temples in classical Greece. But the inflationary 1970s and the litigious 1980s put a damper on folks’ previous enthusiasm — they chose to run with a “construction management” set-up instead.

That design-build was left to pick up lesser-quality projects was an acceptable result. “It kinda got a bad rap as a process, which is really not the fault of the process,” Thomas says. Today, that pendulum is starting to swing the other way, as administrators in the education field have told Thomas they desire a more streamlined process where a single point of responsibility and a higher level of accountability is the name of the game.

Kudos

Proponents are quick to rattle off design-build’s advantages, starting with the speed it offers from start to finish. Thanks to a methodology that brings a very focused, consultative relationship team to the table, the design and build period is intense. “From a blank piece of paper to keys in the door, if everyone is there at the same time, all working out the same issues, then communication is improved, everyone understands intent more clearly and the issues surrounding execution sequencing, cost of materials and those things are put on the table,” Thomas points out. “In half to two-thirds of the time over a traditional delivery method, an owner can take advantage of a guaranteed cost and guaranteed occupancy date, which is enormously valuable.”

Most of 2enCompass’ college and university clients are private and, therefore, bring fundraising issues to the table. Design-build, he tells administrators, provides confidence that the project won’t exceed the donations coming in, and it helps open checkbooks when alumni see the building going up before their eyes. The condensed timeframe also helps when estimating true costs of materials in an atmosphere where costs jump weekly. “The longer it takes, the more expensive it will be,” he adds. “You end up with a design that is actually more holistic in terms of addressing the college’s needs,” says Thomas.

Finally, design-build challenges the mindset of facilities managers, which Molenaar considers a good thing. “A lot of times when you hire a designer or do design internally, you can get set into preferences or doing things the same way,” he explains. “If you bring someone in with a performance outcome — and that’s basically what you’re doing with design-build — they might have a smarter, more innovative way to get to that end product.”

Culture Change

Of course, what Molenaar classifies as a strength can be a negative if the college lacks a strong facilities manager or owner’s representative. After all, if you have a solid reason for yesterday’s preferences, someone needs to speak up lest the design-builder moves too quickly and obliterates that need.

“It’s a learning process,” Belle admits. Design-build’s dynamic situation means you have construction taking place on some level even before the design is totally completed. “You’re not doing construction the way you’ve done it for years, and change is wrenching and challenging under any circumstances.” As a spokesperson for DBIA, he most often fields questions from administrators on how to select the right team for the job, as many in higher education come to grips with the idea of judging on best value rather than lowest bid.

“Design-build works best when the owner has a clear vision, and will participate and implement that vision with the team. If the owner doesn’t have a vision, it leaves it up to the designers, the engineers, the architects, the contractors and subcontractors — then there may be confusion or second-guessing,” says Belle. Indeed, the surveys Molenaar conducted as an initial step in a three-year National Science Foundation-funded research study at the University of Colorado at Boulder revealed back in 1995 that the characteristic packing the most punch on a project is a well-defined scope. It was closely followed by shared understanding of scope and owner’s construction.

It’s also worth mulling that some folks educated in this field believe it’s best to have the architect and contractor in adversarial positions. “It’s the old checks and balances idea,” says Thomas. He, of course, argues that this traditional stance costs owners too much time and money by putting them in a position of refereeing between warring factions. “The whole methodology is set up to facilitate an opportunity for each individual to stake his claim in the ground and fight for it. It’s nice when we can figure out a way to make that three-legged stool one agreement with one point of responsibility and one set of accountability mechanisms,” is his opinion.

Different Strokes

In a classic design-build arrangement, the contract stands between the owner and a contractor who then hires the architects and assumes the liability for the project. It fulfills the college’s requirement for a single point of responsibility but not necessarily the chance to influence and participate to get the highest design quality.

Now, based on two years’ worth of feedback from public sector leaders, that delivery model is beginning to morph to more custom set-ups. For instance, these days 2enCompass forms agreements that the architect and builder are equally responsible — to the penny — for the ownership liability and execution of all work.

“Design-build is an alternative for owners to seriously consider under all circumstances,” Belle says. “The educational community has been looking for the flexibility it offers.”

Digging Deeper

The Design-Build Institute of America (www.dbia.org) offers the industry a designation program for architects, engineers, contractors, lawyers — “anyone working in the food chain,” as DBIA spokesperson Richard Belle puts it — to help steer owners toward top-notch professionals in this delivery process. The designation requires a combination of work experience; passing a number of focused, detailed courses; and scoring well on an objective, multiple-choice exam. At this point, the industry boasts several hundred professionals who have earned DBIA distinctions.

But colleges and universities need to dig deeper than just credentials when hiring a design-build team. Belle also urges due diligence, which involves talking to educational peers, county wards and other officials who have dealt with a firm directly. Administrators are also advised to attend design-build educational seminars and conferences to shore up their own knowledge.

“You have to learn a new process, and if you don’t hire the right person, someone could take advantage of the situation with an owner who is not knowledgeable about the process,” warns Keith Molenaar, an associate professor in the University of Colorado’s Construction, Engineering and Management program.

These are among the questions insiders recommend you ask colleagues and potential firms.

1. Understand the working relationship between the entities that form the design-build partnership. “You don’t want just a warm fuzzy, ‘can they get along?’” says Richard Thomas at 2enCompass. “Are they, in fact, able to perform and deliver on the promises they are making?” To find out, you’ll need to ask:
a. Is there a successful history there?
b. Are there similar cultures as they relate to customer service?
c. What is their track record on guarantees?
d. How does the team make decisions?

2. Who on the architectural side is leading the design effort, and do you, as the owner, have a direct line of communication with that individual?

3. How does the firm approach change orders?

4. Look for what Thomas calls “friendly friction” — the ability to challenge each other in a professional, open manner in pursuit of the best possible solution. “You want a team that is comfortable enough in its own skin to say, ‘I appreciate the fact you put that on the table, but it doesn’t really work that way.’ Or ‘I can do it better this way. Are you open to looking at different ideas?’” he explains.