Projects Delivery & Contracts Types – Part 2: Early Contractor Involvement Vs. Progressive Design

Progressive Design-Build (PDB) and Early Contractor Involvement (ECI) are two project delivery models that appear similar at first sight but are distinct project delivery methods in construction, each with unique characteristics and applications.

Source: Design-Build Institute of America DIBA – PDB [1]

Progressive Design-Build (PDB)

Definition:

The Progressive Design-Build (PDB) approach engages the main contractor at an early stage, often before the start of the design and sometimes even before the project requirements are fully developed. This process fosters collaboration between the client/owner and the contractor. The goal is to co-create a design that is innovative, sustainable, and cost-effective. Furthermore, PDB facilitates the development of a detailed construction price, which is informed by the evolving design details. This method is advantageous as it helps to mitigate project risks, enhances certainty in pricing, and reduces the likelihood of conflicts arising during the project lifecycle.

Source: Florida Institute of Technology [2]

Characteristics:

• Procurement process: PDB emphasizes a qualifications-based procurement process, allowing for collaborative project criteria development. This approach differs from Traditional Design-Build (TDB), where the design-build contractor is often selected based on qualifications and cost. Depending on their procurement guidelines and flexibility, this approach is sometimes difficult to apply for certain public sectors.
• Phased Approach: The project typically progresses through two phases. The first phase covers pre-construction and design creation. The second phase covers the construction. The key difference between PDB and ECI is the PDB contractor is the designer.
  1. In this phase, the PDB contractor works with the owner to develop clear project requirements and progress the design to defined stages such as 30%, 60% and 90%. In this phase, a better understanding of construction risks is developed, a clear pricing strategy is developed, and the client’s requirements are completely adapted.
  2. In the second phase, the design continues to 100%, the construction price is well established, and the construction phase starts.
  3. In some cases, the construction starts before the second phase. in this case, the owner allows early packages or a start for site preparation and procurement of long lead items.
• Iterative Decision-Making: Each design phase is finalized before moving to the next, which can be advantageous in handling complex design elements or unique construction challenges.
• Collaborative Dynamics: PD necessitates a strong collaboration between architects, engineers, and builders, which can lead to innovative solutions but requires excellent communication and management skills.

Source: Florida Institute of Technology [2]

Organizational Structure :

• PBD can be formed in many structures such as integrated entity, consortium or Joint-venture. The PBD entity is the general contractor or the constructor, and the design has been their responsibility since day 1 in a collaborative approach with the owner.

Rail conference – APTA [3]

Contractual Arrangement :

The owner can select either a single contract encompassing both phases of the project or opt for two separate contracts, one for each phase.

Adhering to the owner’s procurement guidelines, a single contract is often advantageous as it promotes price transparency, encourages collaboration, and supports an open-book approach. In scenarios where the owner opts for a single contract strategy, an ‘off-ramp’ option is still provided. This allows the owner to off-ramp in case the parties fail to reach an agreement on the construction phase’s pricing.

Typically, the first phase operates on a fee-based structure or Cost-Plus. The second phase can smoothly transition into a lump sum agreement, Guaranteed Maximum Price (GMP) or Cost-Plus.

Early Contractor Involvement (ECI)

Definition:

In the Early Contractor Involvement (ECI) approach, the owner integrates a contractor at an early stage during the design development phase. This strategy capitalizes on the contractor’s expertise in constructability and value engineering, allowing for the early identification and mitigation of potential construction risks. In this model, the ECI contractor assumes the role of a Construction Manager (CM), who contributes to the development of the design. However, it’s important to note that the CM does not fulfill the designer’s role. This distinction ensures that while the CM offers valuable construction-related insights and advice, the core design responsibilities remain with the designated design professionals.

Characteristics:

• Procurement process: ECI emphasizes experience a qualifications-based procurement process, and service fees.
• Phased Approach: ECI has a two-phased approach like PDB, but it performs differently :
  1. In this phase, the ECI contractor (CM) works with the owner and designer, providing the construction expertise to improve the design constructability, support in design innovation, actively define risks, and work to define the construction price.
  2. The second phase Is the construction, and the project is procured under the traditional Design-Bid-Build (DBB). There is no guarantee that CM is selected as the general contractor.
  3. In some cases, the construction starts before the second phase. in this case, the owner allows early packages or a start for site preparation and procurement of long lead items.
• Collaborative Dynamics: PD necessitates a strong collaboration between architects, engineers, and builders, which can lead to innovative solutions but requires excellent communication and management skills.

Organizational Structure :

• During phase 1, the ECI organization is a construction manager organization where the owner has two arms: the designer and the ECI contractor. During phase 2, it is traditional. DBB, where the owner has a consultant and a general contractor.

Rail conference – APTA [3]

Contractual Arrangement :

In this process, the owner will engage in two distinct contract phases. The initial phase is structured as a service agreement, during which the Early Contractor Involvement (ECI) contractor provides consultative services on a fee basis. This phase focuses on leveraging the contractor’s expertise in guiding the design development, emphasizing constructability and risk assessment. The subsequent phase transitions into a more traditional Design-Bid-Build (DBB) format, commonly consolidating into a lump sum contract. This second phase typically solidifies the project’s scope and costs, drawing on the foundations laid during the ECI phase.

Rail conference – APTA [3]

Conclusion

The choice between PDB and ECI depends on the project’s specific needs and the desired level of collaboration and flexibility. PDB offers more design flexibility and is ideal for projects with evolving requirements. In contrast, ECI emphasizes early collaboration, cost, and time efficiency, making it suitable for large-scale projects. The selection of the appropriate contract type is crucial in aligning with the project goals and the chosen delivery method.

References

[1] Design-Build Institute of America DIBA – PDB

[2] Florida Institute of Technology

[3] Rail conference – APTA