Construction Delivery Methods
There are several delivery methods used today in the construction industry. It used to be that there was one delivery method used by all owners. As times change, so have the delivery methods used. Owners can use a traditional delivery method or an alternative method. Both scenarios get the job done. The owner needs to pick the best method to get the job done correctly. I will explain what a delivery method is, what the traditional method called Design-Bid-Build is, and an alternative delivery method called Construction Management At-Risk (CM At-Risk).
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What is a Delivery Method
A delivery method is needed for every project. Each owner is responsible for selecting the best delivery method to plan, design, and construct the project (McCarthy Building Companies, 2010). The owner has options so the best method can be selected. Owners need to consider the project’s scope, budget, and schedule before the final decision is made (WBDG, 2009). Being well informed about options will put the owner in a good position to make the right choice. A project can be successful with any method, but with the right method, an owner will achieve more success. The decision of selecting the right delivery method has become more difficult in recent years. It used to be that only one delivery method was available. Now, there are several alternative delivery methods (CMAA, 2008). A study conducted in Phoenix, Arizona by PinacleOne shows that many public owners are beginning to use alternate delivery methods (Public Owners Use, 2005). These alternative methods were designed to compensate for the weaknesses in the traditional method. Each method has its advantages and disadvantages (CMAA, 2008). That is why the decision the owner needs to make has become more complicated and difficult to make. The owner has several options to choose from, the traditional option is one of those.
How does it work?
Design-Bid Build is simple. The design is made and then presented to various companies to place bids. Generally, the best bid wins the project.
The oldest delivery method is Design-Bid-Build. This method has been successful throughout the years, and remains the most popular delivery method (CMAA, 2008). With this delivery method, the owner will get architects and engineers to prepare the design of the building that will be built (Poelo, 2009). The design is then presented to general contractors. The contractors will then look over the design and prepare bids for the job (CMAA, 2008). After the bidding is completed, the owner will select the winning bid and the construction process will begin. The winning firm becomes responsible for the completion of the project (Poelo, 2009). The bid is normally awarded to the contractor that gave the lowest bid. The contractor then has a choice to accept or decline. With the Design-Bid-Build process, there are several advantages and disadvantages.
This type of delivery method gives the owner control over the project (CMAA, 2008). The owner will choose which construction company will work on the project. The low-bid regulations and process promote fairness. All the contractors that are present and giving bids understand the system and know what needs to be done to get the job (CMR, 2010). This method has been around for a long time. The owners, contractors, and other parties working on the project know what can be done to make Design-Bid-Build an advantageous delivery method. On the contrary, they also know the disadvantages of it.
Design-Bid-Build can pose some challenges to an owner as well. This method promotes a more adversarial relationship between the contractor, design team, and the owner. An adversarial relationship, instead of a corporation or coordination type relationship, can cause problems and confusion (CMAA, 2008). The project will have already been delayed because of the bids and the selection of the winner. Construction will only begin after a winner is selected. With added confusion, it will cause more delays, and it will take longer for the project to be completed (Poelo, 2009). The architect and engineer are the ones that design the project. Lack of the contractors input may limit how effective and productive the project is (CMAA, 2008). If the contractor does not agree with the plans, the building process could be put on hold while the problem worked on and resolved. It can lead to a more costly final product (CMAA, 2008). If the contractor and the design team are not on the same page in designing the project, there might be change orders and other fees involved to fix the problems. The owner is responsible for the cost involved in changes and it can become very expensive. This is why alternative delivery methods were created.
Construction Management At-Risk
Construction Management At-Risk is similar to the Design-Bid-Build method. With CM At-Risk the construction manager (CM) acts as the general contractor (CMAA, 2008). The owner does not hold all of the risk with CM At-Risk. It is the CM that takes on the risk. He assumes several roles when the owner decides to choose this delivery method. In Construction Management At-Risk there is enhanced communication that helps to produce better results. The CM is involved with the building process early on. The design team and the CM can communicate with each other to improve the design (Pulice Construction, 2004). Doing things this way, change orders will decrease and the owner can save money on that part of the construction process. With early involvement of the CM, construction can begin sooner with fewer headaches. One of the primary disadvantages in the CM At-Risk system is the contractual relationship among designer, CM and owner once construction begins (CMAA, 2008).
Which Delivery Method is the best option?
A delivery method is necessary for all construction projects. The owner will choose the delivery method that is right for the undertaking. Whichever method is chosen, there will be advantages and disadvantages to each and none of them are perfect. The traditional method will be chosen, or an alternative delivery method such as CM At-Risk.