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Collaboration and reward in project delivery

Momentum is increasing within the design and construction industry to develop new delivery processes that foster collaboration among the primary participants and reward performance for successful jobs. Integrated project delivery (IPD) is the newest and most fully invested arrangement for this new paradigm, but a range of contractual agreements can also instill these incentives to varying degrees. Additionally, a few supplemental arrangements can be made within some of these contracts to provide opportunities to reward collaborative teams. Finally, all participants can take a few simple steps regardless of specific contract terms to foster collaboration and deliver the best end product. 

The four major project delivery methods are 1) design-bid-build, 2) design-build, 3) contingency model (CM) at risk, and 4) IPD.  These range from traditional check-and-balance systems to single-source systems to systems that combine the best aspects of both types. CM-at-risk arrangements have become widely accepted as a way to reduce the risk of adversarial conditions between architect and contractor through the early involvement of both parties in the design process while maintaining the independence of each entity and the owner’s responsibility to mediate any differences that may arise. IPD carries this approach a step further by creating a single project entity between the owner, architect and contractor, all of whom are jointly responsible for a project’s successful delivery. Although the contractual specifics of this can be quite complicated, the guiding principle is simple: If all parties are responsible for the end product, their actions should be based on what is in the best interest of that goal, rather than on protecting their individual position.  However, none of these arrangements and strategies can guarantee a collaborative team, and none will prevent it. A successful collaboration is based first and foremost on the collaborative attitudes and approaches of the individual participants.

In addition to increasing collaboration, several measures exist for participants to be financially rewarded for a project’s success. It is commonplace for CM-at-risk arrangements to incentivize construction managers by offering them a percentage of any unused contingency at a project’s close. Similarly, designer contingencies can be used to reward design teams whose documents reduce change orders by offering them a percentage of savings as compared with expected costs based on industry norms. IPD offers all participants the opportunity to share in the financial success of a project (and be responsible for any shortcomings) by pooling project profits to reward all participants fairly for the timely and cost-effective resolution of all issues. Finally, performance bonuses can be used as a simple alternative to the contingency or profit-sharing models. These bonuses are based on the subjective satisfaction of the owner at the end of a project. This prevents manipulation of contingencies to protect individual stakes and allows the bonuses of architects and contractors to be linked so that neither can benefit from the defamation of the other. Although the subjective satisfaction of the owner is difficult to define, it is ultimately the best criteria by which a project can be judged.

These contracts and bonuses can promote and incentivize collaboration and positive results, but they cannot guarantee them. Similarly, none of them will prevent collaboration, either. All participants can electively engage in collaborative behavior regardless of the contractual arrangement. In fact, many people have remarked that the most collaborative and rewarding projects they have worked on were performed with no formal contract at all.

To drive collaborative experiences, a few critical strategies can be undertaken in any situation. First, work in a consensus-based environment. Each participant will have different roles in execution, but all voices at the table should be heard, and decisions should not be made by decree. Decisions reached by consensus rather than by mandate have more power because all participants have an ownership stake in their success. Communication is the backbone of collaboration. A project’s success will depend on the team’s ability to communicate effectively with one another, their client group and their stakeholders. It is important to communicate not just your own ideas but your problems and dilemmas in order to take advantage of the team’s collective knowledge and resources. By working together, projects can happen if team members commit themselves to making them happen. By dealing with issues in a practical and collaborative way, the team will gain confidence in the power of commitment. Ultimately, the critical factors in fostering collaborative teams involve self-motivation, perseverance, reliance, courage, dignity, teamwork and service to others. In short, the most critical aspects of collaborative project delivery have as much to do with citizenship and humanity as they do with design and construction.

Sam Batchelor AIA, LEED AP is a partner at designLAB architects and teaches the community design/build studio at Massachusets College of Art and Design.

Top image: illustration by Paste in Place.