In the economic climate that we find ourselves at the moment, it seems that the only projects out there are public jobs where bids are solicited and any warm-blooded creature with a pulse and a remote ability to read plans can submit a price on the job. The municipalities are required by law to accept the lowest responsible bid. Of course words like responsible can be interpreted in many ways, so the public entity reserves the right to exclude bids from companies that they feel are not capable of performing the work. However, when tax dollars are in the mix, I would think that it is difficult to justify not taking the low bid especially if they can provide the bonding and insurance requirements.
I've been doing a lot of hard bidding lately with only very limited success. Last week I bid a $4 million animal sanctuary where there were at least ten other bidders. Of course I didn't get the job, and not only was I frustrated at wasting nearly a week putting this bid together, I was also frustrated by wasted the time of 50 or so subcontractors that delivered bids to me. If we think about all the time wasted on this bidding process from all ten bidders and potentially hundreds of subs, the man hours begin to hit the stratosphere. Sometime I think that there has go to be a better way.
Well, there probably is, and it is call Integrated Project Delivery (IPD). IPD is a negotiated form of project delivery where risk and reward are shared among the owner, architect, prime contractor, and sometimes even subcontractors. IPD emphasizes early involvement of contractors and collaboration of team members throughout the project. Interestingly, trade contractors are considered the most crucial element of early project collaboration because their input will have significant impact on design and project cost.
Jonathan Cohen with Integrated Project Resources recently published six case studies of IPD projects through the American Institute of Architects. Cohen defines IPD by projects having the following characteristics:
o Early Involvement of Key Participants
o Shared Risk and Reward
o Multi-Party Contract
o Collaborative Decision Making and Control
o Liability Waivers Among Key Participants
o Jointly Developed and Validated Project Goals
Cohen goes into analysis about each individual project but sums up the study by writing:
In every case these projects met or exceeded the owner's expectations with respect to budget, schedule, design quality, and sustainability and also met the financial expectations of designers and builders. Every participant interviewed was enthusiastic about IPD and eager to try it again.
I think IPD is certainly the method of project delivery that makes the most sense, but will certainly involve more upfront investment of time and money in a project. Will owners be able to stomach this release of monies early in the construction project in hopes of delivering a better product? Evidently they have and will hopefully continue to do so.
It will at least cut down on the hours of wasted bidding time.
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