IPD: What’s in it for the engineer?

Integrated project delivery (IPD) requires a team approach and buy-in from all players, including the architect, engineer, and contractor.

By Raj Daswani, PE, LEED AP, CEM, CPMP; Jack Poindexter, LEED AP; Dean Reed,LEED AP June 19, 2015

Learning objectives

  • Understand the steps of the integrated project delivery (IPD) process.
  • Learn about best practices for implementing IPD on a building project.
  • Understand the concepts of Lean construction.

The motivation behind the integrated project delivery (IPD) model is to align the interests of the owner, architect, engineer, and contractor to encourage the collaborative setting of priorities and provide a vehicle for organizational integration. The ultimate goal is to create high-performance buildings that meet the owner’s needs while working within the constraints of time and cost.

Engaging the entire team early facilitates a common understanding of project goals. The contractors are invested in the design from the outset, and the design team develops a respect for the budget. Committed to collaboration, the project will see fewer requests for information (RFIs) and change orders should be limited to those related to program changes. Schedule and budget are therefore controlled.

For the engineer, this can mean a more effective construction administration process, since engineering and coordination issues have been worked out with the subcontractors early in the process and time can be spent delivering greater value. This allows the engineers to focus on engineering as opposed to coordination and constructability issues, leading to a cleaner handover to those who will operate and work within the building.

IPD is first and foremost a project delivery method based on a contract in which the three major stakeholders—the owner, the designers, and the contractors—are bound together and committed to sharing the risks and rewards of positive and negative outcomes for the project as a whole. The central idea is that the owner is hiring a team to help solve their problem, and is committed to working as part of the team to determine which solutions will provide the greatest value.

Systems integration

The goal is to deliver a building that meets the owner’s needs. That requires building systems that are highly integrated. Process integration is a leading method to achieve systems integration. It can happen only by putting together an integrated organization. Facility operators and contractors must work alongside designers and with the owner from the outset. Information must be information must be combined and shared for a project team to operate in an integrated way.

The enablers of integration are simulation and visualization, such as what BIM tools provide, to predict which alternatives will deliver the best performance in light of the owner’s objectives. The owner’s objectives or targets must be measurable and are best expressed as metrics. The project team and processes can achieve breakthrough outcomes by working in multidisciplinary, cross-functional teams to develop solutions at the same time and pace under the direction of strong and decisive leadership. This way of working promotes and requires rapid feedback, which happens best when teams are co-located or come together to work shoulder-to-shoulder.

Deep collaboration emerges as people learn to trust each other by working as partners committed to achieving what is best for the project as a whole, rather than focusing exclusively on problems within their discipline or scope. In the end, the real value comes in producing exactly the physical product the owner needs safely, flawlessly, within their budget, and on time.

This requires Lean production management, which is true IPD. That said, many IPD project teams currently are only able to employ some, but not all, of these principles.

Where does IPD fit with Lean and Lean construction? IPD is a project delivery method, distinct from yet synergistic with Lean construction principles and methods. Lean is a completely different production system than traditional manufacturing and craft production. Outside of the construction industry, almost all consumer products and large made-to-order products such as airplanes and ships are manufactured using Lean production methods. Lean principles are also being applied to the delivery of services such as health care.

The goal of Lean is to change the way work is done to eliminate anything that does not contribute to value as defined by the customer. Lean production creates a flow for the transformation of information, services, and/or materials into a form most useful for the customer, whether that customer is an individual, group, or organization. The essential mechanism of Lean is “pull,” which is defined as providing something on the demand of the next customer to meet the needs of the end customer.

Lean requires a long-term concern for how various elements fit together to form a whole product, also known as systems thinking. It is not a cost-cutting or productivity improvement program. Lean thinking, methods, processes, and behaviors are learned. Once learned, they must be applied consistently and with discipline. There are two fundamental principles of Lean: respect for people and continuous improvement. Learning from experience is the basis of continuous improvement. The Lean view is that mistakes and failures are opportunities for learning, not causes of punishment.

Gregory Howell and Glenn Ballard, often considered the thought leaders of Lean construction, have long advocated that owners, architects, and contractors shift their focus from command and control management—focused on making each task more efficient—to engaging foremen and design leads, the “last planners” in planning work and identifying roadblocks. For some individuals and companies, this was a new vocabulary describing how they already worked. For most, however, it flew in the face of top-down planning management focused on making each step efficient in and of itself. Howell and Ballard’s advice to think in terms of system throughput, hand-offs, and eliminating variability didn’t make sense when they proposed it in the early 1990s.

Tools for success

Within Lean construction and IPD, there are several necessary tools including target value design, the integrated form of agreement, pull scheduling, the Last Planner System, and collaborative planning, especially in a “big room” environment. Target value design is designing to defined value objectives or targets within the constraints of money and time. It turns the traditional practice of designing first, then estimating cost on its head. Cost is an input, not an output of design. Key members of the project delivery team must be in place at the outset to collaborate intensely to produce a “validation study” to demonstrate that their team can deliver what the owner is asking within clearly defined and understood constraints. The only scopes of work put out to bid are those where specialty contractors and/or suppliers are not required for design, and their installation work on-site can be decoupled from the primary work driving the project forward.

Designs are developed and analyzed for value and against cost and schedule constraints within cluster teams—multidisciplinary cross-functional teams charged with an aspect of the project design. Cluster team leads meet regularly with project leaders to report status to the larger team and coordinate their work. Figure 3 shows the difference between the traditional practice of costing a design and designing with cost in mind from the outset.

Chances of success are much higher with an integrated contract, often called an integrated form of agreement (IFOA),that creates a financial partnership and virtual enterprise. Although still not very common (but slowly becoming an acceptable contracting form), this requires the owner, designers, and contractors (including trades) to share one agreement with shared risks/rewards on the project outcomes. The Lean Construction Institute, American Institute of Architects, and ConsensusDocs each publish multiparty shared risk and reward contracts. However, many facility owners and IPD teams prefer IPD agreements that reflect their particular values and requirements.

Pull planning is another necessary tool. As soon as team members agree on the individual steps needed to complete the task, the various cross-functional and multidisciplinary teams can plan how to deliver the work most efficiently by working backward from their milestones. The only real way to produce only and exactly what is needed, when it is needed—whether it be design information, 3-D models, pre-fabricated assemblies, or finished installations—is for each supplier to engage in a discussion with its customer and come to an agreement. This can be done from the big picture level all the way down into the weeds of day-by-day work plans.

The Last Planner system, developed by Howell and Ballard, is a production planning system designed to produce predictable workflow, rapid learning, and accountability in design, construction, and commissioning of projects.

Finally, collaborative planning by aligning milestones, pull planning, and process design—the integration of design with use value; construction processes; facilities operation and maintenance; and social, environmental, and economic sustainability—leads to reliable processing, which creates a high-performing team. Members of high-performance teams collaborate closely because they trust each other to do the right thing and provide what is needed. They realize that, at any given moment, they depend on one or more team members to provide what’s needed so they can deliver something to another team member. Project work is a series of hand-offs from “suppliers” to their “customers.” The better and faster this occurs, the more team members come to trust each other, and the greater the performance of the entire team. It’s a virtuous cycle.

IPD’s future

The multiparty contracting arrangement is becoming less of a novelty as more owners adopt this approach and design, and as construction firms sign on with these arrangements. There is also much to be said about the “spirit” of IPD, and not the letter. There is certainly merit in embracing IPD concepts that can bring teams together for common goals, without an IPD contract.

The future of IPD as a mechanism for delivering complex projects is very bright. While the benefits are clear to those who have experienced successful IPD projects firsthand, it will take time to be considered an obvious way forward for the rest of the industry. The problem is with comparison metrics. Large complex projects undertaking new delivery methods take time to complete, as well as to document metrics of project outcomes that can then be compared with more project delivery methods. It will take time to convince clients of the benefits of expending upfront dollars for outcomes that are not, and may not be, documented fully for another several years. By moving major decisions forward and making those decisions as a team, the project benefits by focusing on value rather than dealing with design elements such as RFIs and changes late in the project.

Truly integrated teams that work toward common goals have a high likelihood of success. This success has been proven to have great benefit not only for owners and customers, but also for team members. When a team truly collaborates, creates processes and workflows that work for everyone and the project, and breaks down barriers of communication, it can drive efficiencies for each individual firm.

For example, a mechanical engineer can move efficiently through the design process at the right time while greatly reducing wasteful rework caused by multiple revisions of space planning, slash-and-burn value engineering, and cumbersome RFI processes and rounds of equipment selection seen in other delivery methods. The team leverages each member’s strengths to optimize the whole during the development of the design, instead of focusing on individual parts of the team. This, in turn, creates capacity for the engineer to focus on his or her area of expertise, and creates the time to get the design truly optimized. This is ultimately the crux of best value as opposed to lowest fee, which is generally a first-cost number only that does not take into account the lifecycle cost of the project.

Another example is when information is needed by one entity (say the electrical engineer) for necessary completion of his/her work. Once the need is made clear on the pull schedule, it becomes the entire team’s responsibility to get the information in the time needed. The responsibility no longer resides only with the engineer to chase down the information (e.g., medical equipment cut sheets). Visibility of each need from every entity is clearly documented, and this is beneficial in ensuring successful outcomes for the project.

IPD is clearly the future delivery method for the “right” types of projects. Complicated projects that require a host of disciplines to come together to share ideas and ensure the best total solution are certainly projects that warrant consideration for integrated delivery, preferably IPD.

Raj Daswani is a principal at Arup, Jack Poindexter is a project executive at DPR Construction, and Dean Reed is director for Lean construction at DPR Construction.