Project Delivery

On February 23rd and 24th the AIA hosted a Federal Design Build Round table to discuss Qualifications Based Selection  (QBS) for Design Build projects at national headquarters in Washington DC. The discussion was led by Elizabeth Chu Richter, AIA 2015 President.  Present were members of the AIA staff, major federal agencies such as the GSA, NAVFAC, the Coast Guard and the USACE, and members of the Large Firm Round Table. 

One of the unintended consequences of Design Build procurement is the costs incurred by the design team and the Owner when pursuing a competitive, best value or solution based, or price-influenced design build solicitation.  A solution to this may be a qualification based selection process to select both the design and construction team on the merit of their qualifications only in a multi-step process; prequalify a short list, then interview and select the best qualified team, with negotiations to follow the notice of selection.

Some of the questions that arose:
What are the challenges both legally and practically to pure QBS source selection? 
What are QBS Best practices?
How do we make procurer's of work more comfortable with Design Build solicitation process?
How can a QBS process work while assuring the agencies that they are getting competitive proposals?
What is the rest of industry discussing with regards to QBS?

As we advance our integrated project delivery processes, and with the emergence of virtual design and construction technologies, alternate project delivery strategies will become the rule, rather than the exception.  Owners  are looking for the best strategies to deliver projects on time and within budget without compromising quality.
    How can Owners best "buy" their buildings?
    How best do we address QBS solicitations?
    How do we address the cost to propose?
    What are the best practices to identify and select the design-construction best teams to deliver the project?

Recently the University of Colorado and Penn State University completed a research project funded by the Charles Pankow Foundation and the Construction Industry Institute titled "Maximizing Success Through Project Integration - An Owners Guide". The findings from the research indicate that the most successful projects demonstrate certain characteristics and employ strategies that enhance team integration and group cohesion.  The three most important characteristics of these high performance teams includes:
Qualifications based selection, Early Involvement of key Specialty trades, and an open and transparent project cost and schedule management structure. The research also concludes that singular contracts such as Design Build and IPD had a greater success rate than multiple contract delivery methods such as design-bid-build and CM at Risk.
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Gregory Gidez AIA
Director of Design Services
Hensel Phelps
Greeley CO
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Please see my white paper article in this month's Owner's Perspective Magazine on just this subject.

The AIA continues to maintain a stance in favor of non-price based QBS selection.  I agree that this process should be used for most smaller projects, but larger projects where even an incremental improvement to the design can create tremendous savings and value for an owner simply must become the basis for selecting the team by way of selecting the best solution.  Once selected under QBS, the team has very little incentive to deeply explore these cost saving ideas, and unfortunately, Owner's have little understanding of the implications and little tolerance for the investment required to seek them out.

QBS stands in the way of procurement based on demonstrated value specific to the project in question.  Owners must be educated that there is another way to procure work that will result in not only better solutions, but will create a paradigm shift and an adoption of design and building technology as well.

I hope you will read the article.

http://ownersperspective.org/digital/OP_1503_Spring_Summer/


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Alan Burcope MBA, LEED AP
Architect
HHCP Architects
Orlando FL
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Hi Greg,

In Arizona, APDM (Alternative Project Delivery Methods- Construction Manager at Risk/CMc, Design-Build and Job Order Contracting) became legal for public agencies about a dozen years ago.  It does take a different mind set for a public agency to accept other than low cost selection/traditional bid for selection.  Other methods are rightly sold as best value because no matter how you paint the justification, they cost more to deliver than traditional bid, but there are benefits to the institutional owner in return for the higher delivery cost. It's also critical that the institution understand each delivery process and properly train or hire project management staff who understand and are experienced with the APDM methods.  Neither contractors nor owners have been very successful trying to convert low bid staffs to APDM staffs.

In Arizona, our statutes provide two options for design-build selection.  A one step selection provides for purely a QBS selection of the team, with costs and fees to be negotiated with the best qualified firm.  A second method allows a two step selection, as you've described, with the first step a qualifications based short list and the second step including a cost and early design component, and potentially some other factors like schedule/time to delivery. The two step process also requires a small stipend to all short list firms that everyone admits is not nearly enough to cover the design and estimating/management costs to the proposing team. Because of the extra steps and costs in a two step selection- and the fact that Arizona also is strongly embedded in a pure QBS selection process for Construction Manager at Risk- nearly all design-build is selected as the one step process and most everyone has learned to live with that. 

Regarding your question about  "How do we address the cost to propose?", that really is an industry issue. With the advantage of using or requiring QBS selection, marketing and proposal costs are a cost of doing business now, the same way that estimating and management costs are somehow built into the cost when bidding the work. Firms can become more efficient in marketing and proposal delivery, but I don't think that you will find owners offering or accepting a requirement for reimbursing of marketing/proposal costs any more than we do that for consultant QBS selection processes. 

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Arlen Solochek FAIA
Associate Vice Chancellor, Capital Planning and Special Projects
Maricopa Community College
Tempe AZ
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