Sunday, January 8, 2017

Design-build


If you're in the construction industry you probably know about and have experienced "design-build". Notice that there's a word missing after "design", to wit: competitive bidding.

Ooops, a typo? No, there is a body of knowledge around this that says that it's faster-cheaper for the same quality to go "design-build" than "design-competitve bid-build".

In effect, one team -- architect, general contractor, and owner rep -- carry the project all the way through.

Faster-cheaper
The "faster" thing is obvious: there's a missing step, so the cycle has an inherent time advantage. The "cheaper" thing is not so obvious. Why should it be cheaper? There's nothing built in to drive the cost.

Best Value

Maybe it's not cheaper (though the track record over years seems to say it's cheaper), but it should be a best value project. 

That's the segue to: How do you decide which team is the team you are going to go with?  Certainly not lowest-cost, because the cost is not known until the design is known. So you decide on the basis of "best value"

Ah yes! Recall what value is: the best combination of quality, feature, and function that fits a budget. (Did I mention I wrote the book? "Maximizing Project Value". See the cover below)

And so, best value must mean value optimized for one or more of the variables. Of course, your bias will be different from mine, so your optimization will be different from mine. Nonetheless, each opportunity does have a "best value"

And, best value could be "lowest cost, otherwise acceptable". But, often it's not. There are other considerations other than cost. (We'll leave corruption off the list)

Public sector
But, if you're in the public sector, where the public expects probity when expending funds, how do you explain "best value"? Can it even work in the public sector?

Answer: Yes, it works.  In the U.S., some 20 states have made it legal, even desired, to go design-build. So the arguments that convince are out there.

If you read through the Wikipedia article under the link above, you'll see a pretty good to-and-fro on the good, the bad, and the marginally acceptable about design-build. There's even a design-build handbook and of course a design-build society.



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