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Integrated Practice Takes Hold

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Journal of Information Technology in Construction

The Journal of Information Technology in Construction (ITcon) is a peer-reviewed scholarly journal on the use of IT in architecture, civil engineering and facility management. ITcon articles are submitted and published electronically only. The Journal is committed to minimizing publication delays, and to promoting maximum flexibility in the ways that readers use the journal for teaching, research, and scholarship while maintaining strict peer-review standards. ITcon is an Open Access journal and its articles can freely and with no charge be read by anybody who has an Internet connection. The copyright of the articles remains with the authors, from the start of 2009 using the Creative Commons standard licence.


AIA C191 Multi-party Contracts from OpeningDesign.com on Vimeo.

ConsensusDOCS 300 Tri-Party Agreement from OpeningDesign.com on Vimeo

Integrated Project Delivery Initiatives

This commentary was provided by James L. Salmon, at the time, of Counsel with Beatty Bangle Strama, p.c. of Austin, Texas and President of Collaborative Construction Resources, LLC. Mr. Salmon was named to an IPD Initiative Committee formed by the Institute for Leadership in Capital Projects for the State of Texas. The IPD Initiative Committee was tasked with investigating options for obtaining approval of IPD as a delivery model under Texas law. It was believed that private IPD processes could be adapted for use by public entities if approved by the Texas Legislature.

Stakeholders in the construction industry are interested in extending the benefits of Integrated Project Delivery (IPD) to the public sector.
In the private sector Integrated Teams are formed early in the planning phase and, at a minimum, include the owner, contractor and the Architect of Record. There is no reason public entities cannot adopt and deploy effective IPD processes if the Texas Legislature will approve the use of these innovative new business tools. Private IPD Owners are utilizing IPD to increase the efficiency with which planning, design, construction and maintenance services are delivered and taxpayers deserve access to those innovative tools which are reducing project costs and work schedules by 15 to 25 percent or more.

In an IPD environment Integrated Teams craft, negotiate and implement Integrated Agreements – including Protocols related to Incentive and Risk Allocation, Alternative Dispute Resolution and Lean Business Processes – all of which increase efficiency and productivity in the planning, design, construction, operations and maintenance of facilities and infrastructure. Integrated Agreements detail collaborative principles pursuant to which Integrated Projects are completed. The scope of work required of each Integrated Team member or later joining specialty designers, subcontractors or consultants (Specialists) – and base compensation for their work – are set forth initially in a Target Cost Estimate (TCE) which evolves into a Guaranteed Maximum Price (GMP) which is, in turn, incorporated into the Integrated Agreement by Amendment.

Key features of an IPD model are listed below. The elements detailed below are flexible enough to meet the needs of public entities, throughout the State of Texas, and the Texas Legislature is strongly encouraged to adopt enabling legislation that will allow the State of Texas and agencies within the State, to take advantage of the reduced costs, increased efficiency and long term energy savings available through the use of IPD as a method for delivering facilities and infrastructure.

Key Elements of an IPD Program

1. Private IPD owners have the luxury of hand picking Integrated Teams. Public IPD owners, bound by restrictive regulatory and statutory procurement rules, are generally not allowed to form Integrated Teams and can only achieve IPD if authorized by statute.

2. The first task in an IPD environment is to develop criteria reflecting the business purpose of the contemplated facility or infrastructure and a Target Cost Estimate. An Architect of Record can assist an owner in identifying criteria and a TCE if an Integrated Team has not yet been formed. Private owners can select the Architect of Record on merit while public owners must utilize a statutorily authorized qualification based selection process. During this phase the IPD Owner and the Architect of Record – or the Integrated Team if already formed – creates criteria detailing the business purpose of the facility / infrastructure and formulates a TCE. Those criteria and the TCE will guide the Integrated Team as ideas are translated into action.

3. If the IPD Owner wishes to receive competitive bids from Integrated Teams it must issue a Request for Qualifications (RFQ) and a Request for Proposals from Integrated Teams. Private IPD Owners who have pre-selected Integrated Teams often skip this step. Public IPD Owners will be required to issue RFQs and RFPs and to consider proposals from competing Integrated Teams. Public selection committees can short list Integrated Teams that meet the RFQ and submit competitive responses to the RFP. Where criteria are not yet well defined qualifications will drive selection while selection for Integrated Projects with well defined criteria will be based on best values calculated by a weighted combination of qualifications and price. An Integrated Team’s proposal should include a break down of Integrated Team members’ base fees, general conditions – if such conditions are in addition to and not in conflict with the required form of Integrated Agreement – a description of the scope of work for which each Integrated Team member will be responsible, contingencies and, if appropriate a TCE / GMP based on best practices. Base fees should be calculated by reference to the amount of risk each Integrated Team member is willing to bear in exchange for a percentage share of the amount by which the Integrated Team beats the GMP (a.k.a. “risk fee”) after it is locked in by amendment. In exchange for access to the short-listed firms’ work product, value engineering ideas and unique design solutions – all of which require extensive preparation and include confidential and proprietary information – IPD Owners must be prepared to compensate non-selected firms for access to such information through a reasonable stipend.

4. The Integrated Team can provide pre-construction services to the IPD Owner during the planning and design phase, similar to a CM at Risk, prior to reaching an agreement on a GMP. It may be appropriate at this stage – or even earlier – to negotiate a Master Non-Disclosure Agreement and / or Confidentiality Agreement among the parties to protect the intellectual property, trade secrets and other confidential information being shared among the Integrated Team members.

5. Once criteria and TCE are mature – usually at the schematic design stage under the traditional design-bid-build delivery model – the Integrated Team can develop and negotiate a GMP proposal with the IPD Owner. If agreement is reached on GMP that number is incorporated into the Integrated Agreement by amendment. If agreement cannot be reached on a GMP the IPD Agreement may be terminated and the IPD Owner can abandon the project or invite other Integrated Teams to negotiate an agreed GMP. Any IPD Owner that engages a new Integrated Team must avoid breaching the NDA / CA signed with former Integrated Team members. Alternatively, the initial Integrated Team – or even certain members thereof – may choose to waive their “risk fee” and execute an amendment to the Integrated Agreement to perform services on an alternate pricing basis. Finally, the IPD Owner may select a different delivery model all together if GMP negotiations fail.

6. The agreed GMP takes into account the costs and fees of all Integrated Team members as well as the costs and fees of specialty designers, subcontractors and consultants (Specialists) that have not yet joined the Integrated Team. Once an agreement is reached on GMP the Integrated Team can move forward with the project, inviting bids / proposals from Specialists as necessary. Specialists who join the Integrated Team must agree to be bound by the general conditions of the Integrated Agreement, though fee agreements, costs and other special arrangements can be separately negotiated between Specialists and existing Integrated Team members, provided the Specialists agree to be bound by the general conditions of the Integrated Agreement. In the public sector all Specialists submitting bids must be pre-qualified by the State, and / or the contracting authority and the Integrated Team.

7. Award of contacts to Specialists can be based on merit, value and team chemistry – preferred criteria in the private sector – or the lowest responsive bid in the public sector (responsibility having already been determined in the pre-qualification process).


familia Corazon

Using BIM to help those most in need

familia Corazon works in Mexico and is headquartered in San Diego. Over the years they have built over one thousand houses in northern Mexico and are also creating community centers, community gardens, etc. to help the people that live in their homes. They are somewhat like Habitat for Humanity, but work with a less affluent clientele and housing is just a small part of what they do. Corazon is an international non-profit home builder that has built and given away more than 1,000 simple homes and numerous community centers in Northern Mexico over 25 years. Corazon always builds its 400 sf homes in one day. Americans might call it a one-car garage, but where Corazon builds, it is called a mansion. For more information about Corazon visit – www.corazon.org – or go to www.youtube.com – and search Corazon House Building.

Design Atlantic Participates in Historic Global Economy Demonstration

Design Atlantic worked with Corazón to provide professional input and get a house built in Tijuana on January 31, 2008. During the process, Corazon received national media attention. In addition, we master planned two sites, one in the hills southeast of Dodger Stadium and a flat site near a metro station using Corazón houses and the Corazón community center concepts. Both projects have received national attention.

Design Atlantic, Inc. Salisbury, Md. was a key participant in a first-of-its-kind demonstration of online architectural collaboration that “landed” 40 million square of virtual buildings on Google Earth – in one day: January 31, 2008. In addition to participating in the online design exercise, Design Atlantic president, Finith Jernigan, AIA, also played a major role in showing how the same technology can assist real-world projects by leading a team that built a home in Tijuana, Mexico – in one day: January, 31, 2008.

Jernigan did not need to be in Tijuana because his design recommendations had already been contributed via advanced web conferencing systems and conference calls. Nor did he have to be in Los Angeles, the location of the Google Earth site for the virtual buildings.
By staying in Salisbury while significant projects were underway involving participants from around the world, Jernigan demonstrated how his architectural firm is helping to house people across the country while contributing to the development of web-based software tools that allow all building industry professionals to participate in the Global economy.

Before construction – build day minus 1

We are leaving for the site now and should be there for a 7:00 start. One of our Mexican Board of Director’s is a local television personality and Channel 12, will be there to cover the event. I thought you might like to see the notice that Victor put out to the Board.

Estimados Miembros de la Prensa:

El juéves por la mañana nos confirmaron que Corazón fue escogido por la industria de la construcción de Los Angeles, California para realizar una demostración mundial de herramientas de diseño y construcción de estructuras a través de la colaboración de herramientas en línea, como Google Earth.

El evento se llevará a cabo el próximo 31 de enero de 2008 en la colonia Cumbres de Tijuana, donde construiremos una casa al mismo tiempo que cientos de profesionales alrededor del mundo estarán colaborando en el diseño y proceso. Este será un hito en la historia de la industria y dentro de los patrocinadores se encuentran empresas como Microsoft y agencias como la Guardia Costera y la Armada de Estado Unidos.

Los Consejos Directivos de México y Estados Unidos de Corazón envían el boletín de prensa a fin de difundir este evento. Les envío el boletín y disculpen la brevedad de tiempo . Les mando también el enláce a la página electrónica del evento. Se que tendrán muchas dudas y me pongo a tu disposición para cualquier aclaración.

Essentially, that Corazon has been chosen to be part of an historical demonstration of construction techniques online and that Corazon will be building in real time the virtual buildings being built in Los Angeles. The partners in this endeavor will include Microsoft,the US Coast Guard and Army. The Board was also given directions for following live on the Internet.

This should be a very remarkable day.
—Terry Mackprang, President familia Corazon

Build day – Welcome to the world of BIG BIM

Today we (and 400 of our best friends) are going to complete a life changing event in the world of planning and construction. We plan to keep you on the frontline and to help you to understand the significance and what is happening today in LA and across the world.

There is a reason that the cover of my new book BIG BIM little bim features a young person and not a building. BIG BIM is about people. The technologies that drive the process are important, but they are not what this is all about. Today one of our goals will be to introduce you to the people that are making this happen. They are telling the world that the time has come to do things in a better way. They are telling the world that we can no longer afford to do business as usual. They are changing the world for the better.

Paul in Colorado is helping people in Mexico by creating new ways to build housing in ways that the families in Corazon communities can afford. Rick is sitting in his office and making sure that those that use the new buildings will be safe and secure. Karen is making green roof technology available to everyone. Kevin is helping a state become more integrated and able to better manage their projects. Kimon, Susan, Yong and Thomas are creating a system that allows it all to happen. Others are providing expertise in costing, emergency response, energy and just about every other area that you can imagine. Architects, engineers, owners, planners, GiS experts, programmers, developers, appraisers, firefighters and students will all be up to their elbows in the process.

Terry and Victor are in Tijuana, Mexico as you read this email. This morning they are going to begin construction on a Corazon House. By the end of the day a family will be moving into Terry and Victor’s house. To this family their new house will be a mansion of the first order. Today we will show you how the construction is progressing and with luck be able to show you video of the occasion.
—Finith Jernigan, President Design Atlantic Ltd

After construction – build day plus 1

The whole idea behind the familia Corazón program is better communities and families through a sense of community—one neighbor being able to trust and rely on another neighbor. In 1995 when we started the program, it seemed like an impossible dream. The communities we had been working in for the previous 17 years were a fragmented and disparate group of people from all over Mexico and Central America. No one even knew their neighbor much less have any belief they could rely on them for any sense of help or support.




Is Integrated Practice Taking Hold?