I recently conducted a survey on Integrated Project Delivery (IPD) sponsored by Electri International. Many of the comments were interesting. And if not surprised by some of the comments, I was surprised by the higher percentage of respondents that shared a similar view.
Over 40 percent of the respondents that have actually participated in what they considered to be an IPD project declared their greatest risk was their partners in the venture. Of course, partners present risks. In fact, you present risks to your partners and your clients, but you still believe you should get the job. Well, your partners think the same thing about you. However, if one partners with highly competent partners that risk is very low. Therefore, the idea is to carefully select your partners to make the so called “partner risk” becomes virtually insignificant. An IPD project offers the advantage that you have the opportunity to select your partners. In contrast, on a design-bid-build project you have no idea who the participants will be. In the design-bid-format, you may not be liable for losses incurred by other project participants. But their actions can have a negative impact on your bottom line, and there is often very little you can do about it. It seems the best option is to select your high performance, experience partners for your IPD projects to minimize your risk.
Part of the problem was revealed when 60 percent of the respondents that have participated on an IPD project stated they form a different partnership for each project. This approach defeats the primary concept behind IPD projects. In 1998, the United Kingdom authorized a study to determine how the construction industry could improve productivity. The resulting report was the Egan Report, chaired by Sir John Egan. In the foreword of his report, Egan stated, “Clients should require the use of integrated teams and long-term supply chains and actively participate in their creation.” What Egan was describing is IPD approach to construction. Further, he made his recommendation two years before the Integrated Project Delivery Collaborative, of Ocoee, Florida coined the term “Integrated Project Delivery” and filed for a trademark of the term.
Therefore, what makes IPD different is that it establishes a long-standing, integrated team that competes for projects as a team. After all who would expect to win the Super Bowl with a pick-up team? So would anyone expect to get the best results from a pick-up construction team?
- Many respondents complained about how much effort was required to find the right team members. If the invested effort was on a long-term venture instead of a single project it certainly would give the investment greater value. The advice is to start the process of finding partners by meeting with firms that you have worked well with on prior projects and who share your values with concerning collaboration, trust, and value focus, etcetera. You are not looking for the cheapest partners. You are looking for the most experienced and knowledgeable partners possible. You want partners that have a great fit with the overall team. The idea is the right partners working together can deliver maximum value at the lowest cost as result high efficiency and expertise. This approach will create a win-win situation.
- Often IPD is referred to as Lean IPD. The reason is simple, IPD embraces the concept of eliminating waste from the process just like Lean. To totally embrace Lean concepts requires a collaborative effort similar to IPD process. According to the Construction Industry Institute, 57 percent of the effort during the design and construction of the typical project adds no value and is not required. What has made eliminating this waste, so challenging is the fact that most of the waste occurs between the tasks, not within in the tasks. This condition makes it difficult for a single entity to make significant improvements on their own. What it requires is to remove the waste is the collaboration throughout the entire supply chain that the IPD method delivers when done properly.
- Implementing a Lean process is not a destination, but a journey that requires continuous improvement. The only way that continuous improvement can be sustained from project to project is to have the same players travel from project to project. This reasoning could be applied to just managing the IPD process, which is certainly different than the design-bid-build process, and, therefore, requires practice in perfecting also. One survey respondent stated, “As with any new process, the 1st project we did not get the entire team to buy-in and understand the cost aspects, but on the 2nd project the team was fully in tune with the costs.”
- A constant theme of the respondent was the importance of trust in their partners. Once you establish a long-standing team, the trust and confidence will gradually increase over time as you become more aware of each other’s abilities and strengths. IPD is a team sport, and that requires each team member having confidence in his team members doing their jobs. It’s also important to identify any holes in the team’s capabilities. This knowledge any team weaknesses will allow the team to avoid projects that require that capability, therefore, reducing risk.
While there are other benefits of developing a long-standing team, I think the above examples demonstrate why IPD should rely on long-standing teams, instead of trying to put together a team for a particular project.
Ted Garrison; president of Garrison Associates, is a catalyst for change. As a consultant, author and speaker; delivers his Construction 3.0 Strategies that offer breakthrough solutions for the construction industry by focusing on critical issues in leadership, project management, strategic thinking, strategic alliances and marketing. Contact Ted at 800-861-0874 or [email protected]. Further information can be found at www.TedGarrison.com.