A Guide to Common Construction Project Delivery Methods
What is a Project Delivery Method?
The project delivery method defines the relationship between parties involved (typically an owner, designer, and contractor) and when and how they will fulfill their obligations and responsibilities.
Ensuring that the process is clearly defined before construction begins can curtail potential misunderstandings and snags, helping the project progress more smoothly. It sets clear expectations for everyone involved, including payment processes and schedule details.
Selecting a project delivery method and contract format should be done early in the planning phase. Consider variables such as project scope, risks and liability issues, timeline, budget, and previous experience to make the best choice. In the next section, we’ll look at some of the most common types of project delivery methods used in construction.
A Comparison of Project Delivery Methods: Pros and Cons
Today’s most common project delivery methods include:
- Design-Build (DB)
- Design-Bid-Build (DBB)
- Construction Management-at-Risk (CMAR)
- A Guide to Construction Project Management Methods
- Job Order Contracting (JOC)
- Construction Management Multi-Prime (CMMP)
- Integrated Project Delivery (IPD)
Let’s take a closer look at each one and what kinds of projects they work best with.
Design-build or DB, simplifies projects for owners who are only contracted with a single firm in this method. One contract covers both the design and construction phases, and the project usually progresses as an integrated process, with the two phases overlapping.
This system speeds everything up, and designates a single leader—the design-builder— who is responsible for meeting the contract requirements. The design-builder is also responsible for spotting inconsistencies between prescriptive requirements and performance standards and reporting those to the owner and other stakeholders.
Pros of DB:
- Simplifies the entire process under a single agreement
- Cost efficient
- Project can be fast-tracked for quicker completion
Cons of DB:
- Important to select a qualified design-builder as this individual carries so much responsibility
- Owner must yield control of design details to the design-builder and team
- Often an unfamiliar delivery method, meaning owners must mentally adjust
The most popular delivery method in the U.S. is the design-bid-build (DBB), to the extent that you’ll often see it referred to as the “traditional” method. As a first step in a DBB project, the owner selects an architect to design the construction project. The team then gathers construction bids and selects a general contractor from among the bidders.
The DBB method requires two contracts in the design and planning phases—one to cover design and the other for construction. Responsibilities are divided between the three main parties, with the contractor ensuring the project proceeds according to design, the designer defining and enforcing a professional standard of care, and the owner covering any differences between specifications and performance requirements.
Pros of DBB
- Well-known, familiar to most construction professionals
- Often has the lowest up-front costs
- Owner retains ample input about design
- Design must meet professional standards, such as those defined by the American Institute of Architects
Cons of DBB
- Architect and general contractor don’t collaborate during the design phase, often resulting in discrepancies and change orders—which can slow down the project’s progress
- Owner is responsible if there are problems with the designer’s drawings
- Lack of collaboration throughout the process may result in more conflict, confusion, and disagreements between involved parties
Construction Management-at-Risk (CMAR)
An offshoot of the DBB process, CMAR takes a similar approach, but the owner hires a construction manager (CM) to oversee the project. The CM becomes the owner’s representative, supervising every phase from design to construction.
During design, the CM calculates a guaranteed maximum price (GMP) and submits it to the owner for approval. If the project is completed for less than the GMP, the owner will often reward the CM—but if the project ends up costing more, the CM might have to make up the difference.
Pros of CMAR
- Owners can work directly with designers
- Builders are part of the collaboration from the beginning, helping to develop more accurate budget expectations and speeding project delivery
- Owners can take more of a hands-off approach to management
Cons of CMAR
- There’s no direct contract between designer and contractor in this method, meaning the owner must bridge the gap to resolve problems
- Owner is responsible for the success of the design plans
- Finding a trustworthy and experienced CM is essential—if the owner fails in this, the entire project could become a nightmare
Job Order Contracting (JOC)
Known as an indefinite-delivery, indefinite-quantity (IDIQ) project delivery method, JOC is an open-ended approach allowing multiple projects to fall under a single long-term contract. Instead of sending individual projects to a bidding process, owners gather bids from contractors once and can then use their services as long as the contract lasts.
JOC uses a catalog of pre-priced tasks known as the Construction Task Catalog® (CTC). Contractors agree upon their rates and they are listed in the catalog, making it easy for owners to choose a bidder and award the contract.
Once under contract, the contractor may be called upon to fulfill tasks for the owner at any time along the way. Individual projects start out with meetings between owners and contractors to determine scope and budget expectations. This method speeds up the procurement process from several months to just a few weeks, also reducing costs and administrative overhead.
Pros of JOC
- Time-efficient and cost-efficient
- Less administrative work
- Allows owners to complete many projects under a single contract, with only one bidding cycle
Cons of JOC
- If the Construction Task Catalog (CTC) is unclear or includes unspecific listings or misleading prices, it can create confusion and potential headaches for the owner—and slow down the project
- Not ideal for complex, one-time construction projects
Construction Management Multi-Prime (CMMP)
Like DBB, CMMP includes three project phases—design, bid, and build. But with CMMP, the owner establishes individual contracts with general and trade contractors for specific elements of the work, such as plumbing, architecture, and electrical needs. The owner acts as the general contractor on the project, overseeing the plans and specs and taking responsibility for design details.
Pros of CMMP
- Owner has control over the entire project through individual contracts with trades and contractors
- Designer and contractors work directly for the owner
Cons of CMMP
- There’s no central coordination for contractors, so the owner must play this role
- The many different contracts might lead to confusion and lack of coordination between trades and contractors
- Overall budget can be difficult to calculate and oversee because of the many individual contracts
Integrated Project Delivery (IPD)
One of the most popular newer project delivery methods, IPD is built on ideas of teamwork and shared responsibility and pairs well with the lean construction management approach to projects.
With IPD, a single contract is established between owner, designer, and general contractor. When the contract is set up before the project begins, that means all contractors, subcontractors, and trades are in communication with the owner from the outset. The owner often sets incentives for design and construction teams, with the aim of fostering collaboration and goal alignment.
Pros of IPD
- Increased collaboration and teamwork between stakeholders
- With the use of digital tools and lean methodology, IPD can provide better communication and efficiency
- Project risk is shared equally among stakeholders
Cons of IPD
- IPD is still new, and many traditional construction professionals are unfamiliar (and potentially uncomfortable) with it, meaning there’s a bigger learning curve at the outset
- Getting the contract right is essential for IPD’s success, consuming more effort and time before the project begins
- Owners must be prepared to anticipate whether team members will work well together—or clash
How to Select a Construction Project Delivery MethodChoosing the best project delivery method for your upcoming construction project can be a daunting task. You’ll want to consider these key questions, along with your own personal preferences and work style, to make the best choice.
Control and Relationships
- How much control do you want to have over design details and project outcome?
- Do you want to maintain control of all prime contractors and trades, or do you prefer to put someone else in charge and take a more hands-off approach?
- How important is it to you to avoid conflict between stakeholders?
- Should the contractor have a say in the planning process, or be brought in after design is complete?
- How badly do you want to avoid change orders?
- At what point in the process do you need to establish a firm budget?
- Which project delivery method will help you achieve the most ROI for the funds you invest?
- Do you want to have a direct relationship with the designer?
- If there are design changes along the way, how much do you want to be involved in reviewing and approving them?
- Do contractors and trades need to be able to coordinate with architect and designer during the design phase?
Method Popularity and Acceptance
- Will you be working with traditionally minded construction contractors, designers and architects who may be uncomfortable with taking a more innovative approach to project delivery?
- If you want to try a new method, how familiar are you with the details? Are you willing to help your teams learn a new way of doing things?
Other Tools and Decision Points
- What kinds of procurement methods will you use?
- Have you considered using a digital solution such as construction project management software?
- Do you want the contract to cover many projects or just one?
Public/Private Stakeholder Involvement
- Does your project involve stakeholders from both the public and private sectors? If so, what communication barriers or differences in expectations might that entail?
- If the project itself is for the public sector, does it carry any specific requirements as to project delivery method?