Project delivery method


Project delivery methods defines the characteristics of how a construction project is designed and built and the responsibilities of the parties involved in the construction. They are used by a construction manager who is working as an agent to the owner or by the owner itself to carry-out a construction project while mitigating the risks to the scope of work, time, budget, quality and safety of the project. These risks ranges from cost overruns, time delays and conflict among the various parties.

History

Trends in delivery methods

Though DBB is now used for most private projects and the majority of public projects, it has not historically been the predominant delivery method of choice. The master builders of centuries past acted both as designers and constructors for both public and private clients. In the United States, Zane's Post Road in Ohio and the Interborough [Rapid Transit Company|IRT] in New York City were both originally developed under more integrated delivery methods, as were most infrastructure projects until 1933. Integrated Project Delivery offers a new delivery method to remove considerable waste from the construction process while improving quality and a return to more collaborative methods from the past.
In an effort to assist industry professionals with the selection of appropriate project delivery systems, construction management researchers have prepared a Procurement Method and Contract Selection Model, which can be used for high level decision making for construction projects on a case-by-case basis.

Types

Common project delivery methods include:

Design-Bid-Build (DBB) or Design-Award-Build (DAB)

DBB with Construction Management (DBB with CM)

Design-Build (DB) or Design-Construct (DC)

Design-Build-Operate-Maintain (DBOM)

Integrated Project Delivery (IPD)

Job Order Contracting (JOC)

Public-private partnership (PPP, 3P, or P3)

Build-Finance (BF)

Build-Operate-Transfer (BOT)

Build–own–operate–transfer (BOOT)

Build–own–operate (BOO)

Build–lease–transfer (BLT)

Design-Build-Finance-Maintain (DBFM)

Design–build–finance–operate-maintain (DBFOM) or Design–build–finance–maintain-operate (DBFMO)

Design–build–operate–transfer (DBOT)

Design–construct–manage–finance (DCMF)

Conceptual differences between delivery methods

There are two key variables which account for the bulk of the variation between delivery methods:
  • The extent of the integration of the various service providers.
  • The extent to which the owner is directly financing the project.
When the various service providers are segmented, the owner has the most control, but this control is costly and does not give each provider an incentive to optimize its contribution for the next service. When there is tight integration amongst providers, each step of the delivery is undertaken with future activities in mind, resulting in cost savings, but limiting the owner's influence throughout the project.
The owner's direct financing of a project simply means that the owner directly pays the providers for their services. In the case of a facility with a consistent revenue stream, indirect financing becomes possible: rather than be paid by the owner, the providers are paid with the revenue collected from the facility's operation.
Indirect financing risks being mistaken for privatization. Though the providers do have a concession to operate and collect revenue from a facility that they built and financed, the structure itself remains the property of the owner.

Level of private involvement