Design Ė Build concept:
Design-Build means hiring a single entity for final design and construction,
in lieu of the standard and proven practice of keeping the design process
separate from construction contracting (design/bid/build). Design-Build
is one of many innovative contracting methods. Itís been successful for
many years in Europe on some types of transportation projects and is widely
used in US and in Europe on plant and facility construction projects.
Design-Buildís attractiveness lies mainly in the promise of innovation
stemming from the Designer/Builder collaboration. Traditionally, designers
design the product the public wants, using their knowledge of construction
methods and practices. Builders then take the plans and build accordingly.
Possible design improvements during construction can become somewhat costly
and time consuming since changes require change orders, new specifications,
etc., and the designer's work is typically over with when construction
begins. With the ideal Design-Build project, initial design takes place,
designers obtain feedback from their builder partner, design proceeds further,
construction begins, feedback continues, design is completed, and then
construction is completed. If the process is applied to the right project
with the right controls in place, the public gets a quality product in
a shorter time.
The Advantages of Design - Build:
Saves money - A modified design-build approach can improve bidding process and decrease
the amount of design needed.
Saves time - In projects where completion time is extremely
important, and when other factors are present, Design-Build may be a viable
Provides creative solutions - Design-build approaches
have enabled to use an innovative contract procurement method to obtain
financing for projects.
Firm price at a very early stage - Another advantage of
a design-build approach is that it provides you with a firm price for a
custom-tailored program at a very early stage. This not only meets your
needs, but the needs of the organization financing your facility.
The build-transfer-operate (BTO) model was pioneered in the 1991
development franchise agreement for the SR91 Express Lanes in California
(Euritt et al.. 1994, 24). Adapted from the more common build-operate-transfer
model, it was designed to provide additional protection to the private
sector from tort liability during the operation phase. In the litigious
United States, concerns that inevitable accidents on the toll road during
its 35-year franchise would expose the private sector to unacceptable risk
prompted the state to assume ownership of the facility immediately after
construction. Sovereign protections from liability protect governments
from tort claims on public property, but do not apply to private developers
(Lockwood 1995, 16). Instead of owning the facility during operations,
the private sector enters into an operating lease before the facility opens
The build-operate-transfer (BOT) model is the oldest and most popular
form of development franchise worldwide. Under this approach, the private
sector acquires right-of-way or an existing facility prior to construction,
makes improvements, operates and collects revenues under the terms of the
agreement, and transfers the facility back to the public sector upon expiration
of the franchise. Early infrastructure development charters evolved into
the build-operate-transfer franchises used today.
The BOT system is developing on all the continents and most countries
in the world. This technique is used by governments for restructuring their
economies, rationalizing the management of their economic services of general
interest, financing and realizing infrastructures, get the local communities
out of debt, ensure a better technical performance of the activities given
in concession thanks to the assets and the know-how of the most qualified
operators in the field related to wich they are called upon at the end
of a negotiation or an open tender. One expects improved living conditions
for the population whose needs in equipment and public utilities will therefore
be better satisfied.
U.S. Roadways DBFO and BOT projects:
Many of the first U.S. roadways were privately financed by associations,
users and the automotive industry. In some countries, concessionaires are
used to allow corporations with mixed capital structure or privately owned
corporations to finance, design, build and operate toll roads.
Team Approach Contracting
Before beginning with the pre-construction phase of a project it
may help to understand some successful models and patterns of team approach
contracting. The most popular technique is design-build, which is in essence
a revival of the age-old building practice of single-point responsibility.
Single-point responsibility contracting has deteriorated in the twentieth
century as architects, contractors, and owners have lined up in opposite
corners protecting their own interests. Frustrated customers and contractors
are now delighted when they experience the benefits of team-approach contracting
and often later seek out only builders that include this discipline in
their services. Why? Because it works! Instead of allocating risk, the
team members share risk. They sit around the project table and work toward
the same goals instead of grabbing at each other's piles. So why are people
reluctant to take the plunge? Our "consumer beware" society perpetuates
an "us against you" mentality that grates against writing a cost-plus-type
contract. Another reason is it requires a level of sophistication, leadership,
and effort by the project's owner. When the owner is not capable or is
ignorant on how to proceed, the contractor also may not be informed enough
to "lead the leader" or to take charge.
Whether a project is architect led or contractor led, the design-build
method sets up a team or partnership with the same goals. It avoids the
resulting finger pointing of design-bid-build methods. Design-bid-build
methods can become a two-edged sword when designers do not guarantee the
outcome of the project. As a general contractor, if you are going to implement
the design-build system you must understand and promote it. In most cases
the general contractor will take the leadership position even if it is
a "shadow leadership" supporting the owner. Most owners are ill prepared
or too busy to put forth the effort required to initiate a design-build
project. General contractors must display knowledge and abilities in management
and leadership skills in order for owners to have confidence in their abilities
and to want them as part of the design-build project delivery team.