Project Delivery MethodsProject Risk and LiabilityOwners are often the greatest source of Project RiskProject Risk – Alaskan PipelineProject Risk – Project TypeProject Risk can be managed by the building approach (delivery method) and choice of contractDelivery Method is the term used to describe the manner in which the project team is organizedMany Delivery Methods are employed, but most are derived from the following:Design – Bid – Build*Design-Bid-BuildDesign BuildDesign-BuildModified Design-BuildConstructor as CMPure CMContract TypesConstruction Project ManagementConstruction Project ManagementFourth EditionFourth EditionConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedProject Delivery MethodsChapter 4Construction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedProject Risk and Liability The approach (delivery method) utilized to manage a project should be in response to the risks inherent in a planned project.Sources of Risks may be:Project TypeProject Site or LocationOwner OrganizationAccelerated Design-Build ScheduleConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedOwners are often the greatest source of Project RiskConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedProject Risk – Alaskan PipelineWorking north of the Artic Circle in darkness and extreme cold with extended supply lines added significant risk to the Owner- Constructor team.Construction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedProject Risk – Project TypeThe one of a kind, Frank Gehry designed, Stata Center at MIT brings risk to the owner – constructor team in the areas of constructability, and cost and schedule control.Construction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedProject Risk can be managed by the building approach (delivery method) and choice of contractConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedDelivery Method is the term used to describe the manner in which the project team is organizedConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedMany Delivery Methods are employed, but most are derived from the following: Design-Bid- Build Design-BuildConstruction ManagementConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedDesign – Bid – Build*Construction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedDesign-Bid-BuildAdvantagesSingle Fixed PriceHistorical PrecedenceOpen competitionActive Owner not requiredDisadvantagesDifficult to fast trackNo constructor inputChange Orders neededConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedDesign BuildConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedDesign-BuildAdvantagesSingle ContractCollaboration between designer and Constructor possibleFast tracking possibleDisadvantagesFirm cost established lateNo Designer-Constructor balanceConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedModified Design-BuildBridgingOwner hires Architect for prelim designOwner solicits bids from Design-BuildersArchitect serves as Owner’s RepConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedConstructor as CMAdvantagesEarly GMPFast tracking possibleConstruction input in designDisadvantagesFirm price established lateRequires heavy Owner involvementConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedPure CMAdvantagesSaves Owner resourcesProvides technical expertiseCompetitive pricingDisadvantagesFirm cost established lateProject Cost not GuaranteedConstruction Project Management, 4/eFrederick Gould, Nancy JoyceCopyright © 2014 by Pearson Education, Inc.All Rights ReservedContract TypesSingle Fixed PriceUnit PriceCost plus