SPONSORS

SPONSORS

Integrated Project Delivery

Complicated Collaboration or Improbable Panacea

SECOND EDITION

By William A. Moylan, PhD, PMP

and

Nadia Arafah, ABD

College of Technology, Eastern Michigan University

Ypsilanti, Michigan

 


Abstract

Integrated Project Delivery (IPD) is different from traditional construction project delivery methods. IPD requires early involvement of key parties with sharing of decision-making, control and project risks. Removing the associated liability encourages the parties to focus on producing the best, economical design while executing the construction efficiently and effectively. In IPD, the facility owner pays for direct costs and overhead, theoretically striped of profit. The risk of losing money is minimal with the opportunity to share in net budget savings. IPD seems like a panacea; however, skeptics remain. The typical designer and constructor, both pragmatic by nature, are distrustful of unproven methods. IPD seems complicated to those not attuned to creative problem solving. IPD participants must be trusting and trustworthy, able to collaborate and cooperate, and, communicate ethically and sincerely – not common traits of the construction industry. The paper compares and contrasts these positive and negative aspects of IPD.

Introduction

Integrated Project Delivery (IPD) has been touted with both raves and reservation as a construction project delivery method. IPD boasts better buildings thanks to multiparty contracting with trustworthy partners. However, detractors warn that IPD remains as complicated as it is collaborative.

In IPD, project risks are shared equally among the multiparty contract entities and offers subsequent profit sharing from any positive budget balances. Removing the associated liability encourages the parties to focus on producing an economical design and executing the construction activity efficiently and effectively. The IPD project is organized like a business with early involvement of key players with shared team decision-making and control. Orientation [onboarding] is critical because IPD’s approach, process and vocabulary are different from the normal project delivery methods. In IPD, the facility owner pays all contract signatories’ direct costs and overhead, theoretically striped of profit. The team of designers and contractors contribute to a profit pool, based on a target price. The risk of losing money is minimal with the opportunity to share in the net budget savings (i.e., profit). Moreover, IPD offers opportunities for repeat business with trusted partners.

However, skeptics remain. The typical designer and constructor, both pragmatic by nature, has honed their business skills from the school of hard knocks. IPD seems complicated to those not attuned to team-based, creative problem solving. IPD participants must be technically knowledgeable with the requisite business savvy, be good at ‘playing well’ with others, and exhibit good communication skills; not the typical tool-kit of the A/E designer and construction manager.

The paper reviews the background of IPD including requirements, compares and contrasts the positive and negative aspects of IPD, and, suggests recommended practices to ensure the best brick for the buck from IPD.

Background – Constructed Facility Project Delivery

The methods and means by which the Constructor delivers the completed facility [the “how”] based on the design of the Architect / Engineer [the “what”] is important.

Construction Contractual Arrangements

In construction, the contract type will vary over the project life cycle. Typically, reimbursable contracts are used for the conceptual and design work at the beginning of the project, and fixed-price contacts are preferred for the construction work. The following factors affect the selection of the contract type for a specific work package: level of detail available, urgency of the procurement, level of competition desired, level of competition available, and, organization’s risk utility or tolerance.

The major types of construction contracts (PMI, 2008) are as follows:

More…

To read entire paper, click here


Editor’s note: Second Editions are previously published papers that have continued relevance in today’s project management world, or which were originally published in conference proceedings or in a language other than English. Original publication acknowledged; authors retain copyright.
This paper was originally presented at the 4th Annual University of Maryland PM Symposium in May 2017. It is republished here with the permission of the authors and conference organizers.



About the Authors


William A. Moylan, PhD

Michigan, USA

 




Dr. William A. Moylan
, PhD, PMP, FESD, DTM is an Educator, Consultant, Trainer, Expert Witness and Practitioner in Project Management and Construction Engineering. He is an Associate Professor with Eastern Michigan University and instructs in Construction Management. Dr. Moylan has extensive professional experience in all aspects of program and project management, including over eleven years internationally with the Arabian American Oil Co, and since 1983 has been involved in implementing information technology. Dr. Moylan received his BS in Construction Engineering from Lawrence Technological University; his Masters from the Massachusetts Institute of Technology, majoring in Project Management and minoring in International Business, and, his Ph.D. in Organization and Management with a specialization in Leadership from Capella University. Dr. Moylan is active in a variety of professional societies including PMI, ESD ASCE, and Toastmasters International.

 


Naida Arafah

Michigan, USA

 

 


Nadia Arafah
is an experienced and innovative interior designer focused on sustainability. She is a faculty member at Easter Michigan University an allied member of the American Society of Interior Designers (ASID). She earned her Masters of Science degree in Interior Design from Eastern Michigan and currently working on her PhD in Technology. Her research interest is evolving about sustainable design as a way of creating healthier interior environments.

In her professional practice, Nadia works on projects of all sizes, from renovating and repurposing old buildings to simply helping clients choose the perfect paint colors for their home. Arafah also takes on select commercial projects in addition to her residential design work, and finds helping people feel comfortable and happy in their office space is always rewarding.

Interior design is not just a career for Nadia Arafah – it’s a passion. Nadia loves meeting interesting and eclectic people, and enjoys the variety of experiences a design career provides. She also works to educate her student about the importance of sustainable design approach and guides them towards learning new software to excel their designs. In her free time, you can find Nadia reading, painting, enjoying the outdoors and socializing with her friends and family.