Should your Firm Consider Design-Build?

Reprinted by permission of Source Engineering & General Contractors Association

Recently the Engineering & General Contractors Association, the Construction Management Association of America and American Public Works Association sponsored a design-build workshop to help local engineering contractors examine whether design-build might be a good business model for them. Attendees learned of many opportunities for design-build public projects in the San Diego region.

In the words of panelist Lee Warnok, administrator for the design and construction management firm of Hatch Mott MacDonald, “If you include the Navy, the regions big three owners are planning to deliver many of their projects design-build, and billions will be spent.”

The city of San Diego continues to use design-build for engineering projects, and the Water Authority plans many design-build projects in coming years.

At UCSD, about 10 percent of the projects use design-build, and this percentage will probably remain the same, according to Jim Gillie, director of Construction Services for the university.

Bob Frankel of the Unified Port District said the Port has $100 million project that potentially will use design-build. Other than that, due to restrictions, the number of future projects that go to design-build will not be significant.

“The switch to design-build is not a switch that happens overnight,” said Iraj Ghaemi at the San Diego Regional Airport Authority. “I think California will eventually switch to alternative delivery methods including design-build. However, if we are going to shift that way it must first happen in Sacramento, and should probably start with Caltrans. I hope it will be the trend of the future, because as owners it helps us reduce our risk factor.”

Engineering contractors found that many growing firms are expanding into design-build and urged the leaders of their association, EGCA, to lead the way by helping members understand what is required and to position themselves to become successful early in the experience.

Key lessons from the EGCA design-Build workshop

Owners like it. Owners generally like the design-build as a way of managing their risk (shifting it to the design-builder) and a way of fostering innovation in ways they had not considered.

Hire the experience. If you are just getting into design-build, start small. Use small successes to build to larger successes. If your company does not have design-build experience, hire it. Choose an experienced design-build project manager and choose an experienced design firm as your subcontractor or partner.

Two crucial steps in crafting a winning design-build proposal. First, select the right design and build team members. Designer and builder should have complementary company cultures, get along well and communicate well. Key leaders on the design-build team need to have strong experience both in doing design-build and in designing and building that particular type of construction.

Show the owner that you thoroughly understand the project and his or her desires in fulfilling the assignment. While owners want “the most qualified team,” more important than selling your qualifications is demonstrating them—by convincing the selection team that you really understand the project, have thought it through, and that you bring value and innovation to it.

Read and follow directions carefully. Read each part of the RFP and address each step in the process separately, assuring you meet the requirements of each step, because they may differ.

Schedule matters. Look for innovative ways to schedule the job. A really thoughtful approach to the schedule—reducing the ultimate delivery time to the owner—can give your team a leg up.

Let designers do what they do best. Typically the contractor hires a design sub. Occasionally they joint venture the project (but most designers don’t have the kind of bonding capacity required). Builders should rely on designers to help them “get their brains on paper,” to express their inner thoughts in ways that communicate well to the owner’s selection team.

Go for lessons learned. If you are not chosen on a project, ask the selection team for a debriefing session to find out why you not selected and how you can do better next time. You already spent the time and money trying to get the work; spend another few dollars and hours gathering valuable information to leverage this failure into future successes.

For a complete report on the ideas exchanged at the recent EGCA design-build workshop, visit EGCA.org.