review Quiz 1 Project Delivery Methods

Question 1

what are the three major classifications for project delivery methods?

Answer 1

traditional, design build, construction management

Question 2

what are some permutations about traditional project delivery

Answer 2

• designer usually selected by qualifications and proposal rather than fee
• builder can be selected by: open bidding, prequalified bidding, qualifications and negotiation
• public owners may be legally required to use (a) or (b)
• option (c) can permit builder to join the project team during the design stage

Question 3

what are the three linear stages for traditional project delivery

Answer 3

• design
• procurement
• construction

Question 4

who are the three prime players for traditional project delivery

Answer 4

• owner
• designer
• builder

Question 5

what are the two contracts for traditional project delivery

Answer 5

• owner and designer (design contract (lump sum, etc.)
• owner and builder (construction contract (unit price, lump sum, negotiated)

Question 6

what are the responsibilities of the players in traditional project delivery? (owner, designer, builder)

Answer 6

• owner: program, finance
• designer: design (and field services)
• builder: delivery of completed project

Question 7

what are some advantages to traditional project delivery?

Answer 7

• Familiar to Owners, Designers and Builders
• Procedures and contractual rules have been worked out and are well understood
• An initial “final” cost often known at the beginning of construction (though this is very dependent on the accuracy and completeness of the documents)
• Open bidding, if used, provides the Owner with the lowest price available
• Once construction begins, Owner can engage professionals to administer the contract

Question 8

what are some disadvantages to traditional project delivery?

Answer 8

Builder’s input usually not available until construction stage (possible cost and constructability issues)

No contract between Designer and Builder

100% Design – Bid – Build
No opportunity to overlap design and construction to reduce time

Partial Design – Bid –Build
Can be done with Unit-Price Contracts

All parties work autonomously—little opportunity for interaction and teambuilding

Different parties may interpret details differently

Unforeseen conditions can be (More likely WILL BE)
a source of conflict and may lead to changes in the contract

Question 9

what are some typical projects that allow for a traditional project delivery

Answer 9

Projects that are not technically complicated, that have been built before, and with:
- Well-defined scope
- Minimal risk of changes
- Time not a significant factor
- Minimal political, technical or schedule constraints

Typical projects include road paving operations, single-family house, warehouse, etc.

That is not to say that an experienced sophisticated owner cannot resort to a traditional project delivery model for a technically complicated project

Question 10

what are some permutations about design-build project delivery?

Answer 10

Contractor-led: Builder engages design professionals required for the project

Integrated: Design-Build entity provides most services itself (may be a joint venture for specific project)

Developer: Used by owners who do not intend to take financial responsibility for the project until it is completed

Question 11

what are the stages, prime players, and contract for design-build project delivery?

Answer 11

Two continuous stages:
Design
Build

Two prime players:

Owner
Design-Build entity

One contract:
Owner & Design-Build entity (Typically fixed Price, Lump Sum)

Question 12

what are the responsibilities for the owner and design-build entity in design build project delivery?

Answer 12

Owner:
Overall Program
Finance (unless Developer is to finance project)

Design-Build entity:
Design and deliver completed project
Manage approvals with Project Stakeholders (MOT, Municipality, etc.)

Question 13

what are some advantages of design build project delivery?

Answer 13

For Owner, single point of contact and responsibility throughout life of project

Good communication between designer & builder

Construction input during design phase can reduce costs and time

Project can be fast-tracked

Question 14

what are some disadvantages of design build project delivery?

Answer 14

Lack of direct connection between Owner and Designer

Lack of checks & balances—Owner must rely on quality and ethics of Design-Build entity (In some cases Design-Build entity can be responsible for both quality control and quality assurance)

Potential for cost-saving strategies to erode design and construction quality

Question 15

what are some projects that work well with design build project delivery?

Answer 15

Highly technical projects in which excellent communication and coordination between designers and builder are essential

Projects that will benefit from fast-tracking:
Extensively used for industrial construction such as manufacturing plants, refineries, offshore drilling platforms, other technical projects or projects which need to move quickly.

Question 16

what is the definition of construction management project delivery?

Answer 16

One firm coordinates all activities from concept design through to acceptance of the facility

Firm represents the owner in all construction management activities i.e. all activities related to construction carried out during the predesign, design and construction phases which contribute to the control of time and cost in the construction of a new project

Firm controls the flow of all information among the parties active on the project

Firm establishes the procedures for award of all contracts to architects/engineers, principal vendors and trade or specialty contractors

Once contractual relationships are established the CM firm controls not only the prime or main contractor but all subcontractors as well as major vendors and off-site fabricators

CM firm uses the project schedule to keep things moving forward in a timely and cost-efficient manner

Major functions carried out by CM firm will vary depending on whether the project is in the (a) predesign, (b) design, or (c) construction phase

Question 17

what are some permutations of CM project delivery?

Answer 17

An Owner can engage a CM either as a CM without Risk or as a CM at Risk.

CM without Risk is appropriate for large, relatively complex projects for Owners who want to hire the Designer and Builder directly but do not have the time or in-house expertise to oversee the project

CM at Risk is appropriate for Owners (usually private sector) who do not intend to be involved day-to-day in the design and construction process. The Owner will pay the CM to carry the risk

Question 18

who are the prime players and 3 separate contracts in CM without risk project delivery?

Answer 18

Four prime players:
Owner
Construction Manager
Designer
Builder

Three separate contracts:
Owner & Construction Manager
Owner & Designer
Owner & Builder

Question 19

who are the prime players and 3 separate contracts in CM at risk project delivery?

Answer 19

Four prime players:
Owner
Construction Manager
Designer
Builder

Three separate contracts:
Owner & Construction Manager
Construction Manager & Designer
Construction Manager & Builder

Question 20

what are the responsibilities of the owner, CM, designer, and builder in CM project delivery?

Answer 20

Owner:
Program
Finance

CM
Without Risk: coordinates Designer & Builder
At Risk: assumes responsibility for the design and construction phase of the work (Signs all construction Contracts)

Designer:
Design (and field services)

Builder:
Delivery of completed project

Question 21

what are some advantages of CM project delivery?

Answer 21

Reduced work load for Owner

Careful monitoring of costs and schedule throughout project

Fewer change orders and delay claims during construction

Management expertise of CM can shorten project completion time

CM at Risk has signed contractual relationships with subcontractors; protecting the Owner from cost overruns.

Question 22

what are some disadvantages of CM project delivery?

Answer 22

Added cost of CM

Good communication between team members and clear definitions of their roles and responsibilities are essential to prevent confusion and potential friction

All parties must be committed to the arrangement

Question 23

what projects are a good candidate for CM project delivery?

Answer 23

Large, complex projects

Projects for Owners who do not have in-house expertise to manage them

Commercial real estate developments

Question 24

definition of a P3

Answer 24

A public private partnership is a partnership arrangement in the form of a long-term performance-based contract between the public sector (any level of government) and the private sector (usually a team of private sector companies working together) to deliver public infrastructure for citizens.

Question 25

what are the some variates of P3’s

Answer 25

• Design-Build-Operate -Maintain(DBOM)
• Design-Build-Finance-Operate (DBFO)
• In P3 arrangements, the public owner doesn’t
  need to pay up front (like a lease instead of a
  mortgage)

Question 26

what is the concept of a P3

Answer 26

Taxpayers or users pay for the project, but not until the facility is built, and then pay is based on performance
The private partner can utilize efficiencies not available in the public sector
Government retains ownership, control and responsibility
The private partner is liable for cost risks, especially on those projects which include operation for a fixed period

Question 27

what are some drawbacks for P3’s

Answer 27

• Agreements take a long time to put together (Surrey Memorial Hospital took 2 years)
• Agreements can be costly to set up (Sea to Sky deal cost $22 million to orchestrate, including partial compensation of $1.5 million paid to each of the 2 losing proponents)
• Projects are usually so big that only a very large company or joint venture can undertake them (especially when financing of the project is involved)
• Despite partial compensation costs for the proponents to bid the project are very high – Therefore proponents are prequalified
• Private partner is responsible for both quality control and quality assurance. Risk to owner can be addressed by the Owner having the
  QC/QA audited

Question 28

what are the 8 reasons why P3’s are not delivering

Answer 28

1. PPPs do not bring new money – they create hidden debt
2. Private finance costs more than government borrowing
3. Public authorities still bear the ultimate risk of project failure
4. PPPs don’t guarantee better value for money
5. Efficiency gains and design innovation can result in corner-cutting
6. PPPs do not guarantee projects being on time or on budget
7. PPP deals are opaque and can contribute to corruption
8. PPPs distort public policy priorities and force publicly run services to cut costs