1 AIA Update on Integrated Project Delivery Lean Construction Institute Design Forum January Markku Allison, AIA

2 position statement | 2007

3 Position No. 26: Project Delivery The AIA believes that every project delivery process must address the quality, cost-effectiveness, and sustainability of our built environment. This can best be effected through industry-wide adoption of an integrated approach to project delivery methodologies characterized by early involvement of owners, designers, constructors, fabricators and end user/operators in an environment of effective collaboration and open information sharing. The AIA also believes that an architect is well qualified to serve as a leader on integrated project delivery teams. The AIA further believes that evolving project delivery processes require integration of education and practice in design and construction, both within and across disciplines.

4 Ramifications Applies to all projects Integrated, collaborative models are best Early involvement is important Open information sharing is important Design and construction education integration should happen Leadership may involve more than just the architect

5 sea change for the Institute

6 integrated project delivery guide |

7 ipdg | key ideas Principles of Integrated Project Delivery (general) Mutual Respect and Trust Mutual Benefit and Reward Collaborative Innovation and Decision Making Early Involvement of Key Participants Early Goal Definition Intensified Planning Open Communication Appropriate Technology Organization and Leadership

8 ipdg | key ideas

9 IPD principles can be applied to a variety of contractual arrangements

10 market interest ( ) Owner Designer Constructor Subcontractor Engineer Systems Supplier Attorney Insurer Student Educator None of the Above GRAND TOTAL % 44% 11% 2% 8% 2% 3% 1% 3% 11% 100%

11 research

12 Nearly 80% of respondents indicate they are aware of IPD; about half of respondents view themselves as knowledgeable or experienced. Confidential Base: Total Respondents n=2051

13 Based on the definition, reduction of conflict is the IPD attribute of greatest value to project teams. Confidential Base: Total Respondents n=2051

14 Based upon the definition, early involvement of key participants is the most important principle of IPD. Confidential Base: Total Respondents n=2051

15 Of the potential barriers provided to respondents, lack of legal precedent and industry partner skill sets are the greatest barriers to pursuing IPD. Confidential Base: Knowledgeable/Experienced with IPD n=1074

16 Lack of trust, lack of skills, lack of information about process and lack of appropriate technology are not significant barriers for most segments. Confidential Owner (n=137) Architect (n=708) Engineer (n=60) Contractor (n=137) Sub- contractor (n=32)* Know- ledgeable (n=583) Experienced (n=480) Lack of Legal Precedent61%67%57%52%53%76%47% Industry Partner Support Not There47%58%63%52%59%62%48% Lack of Insurance46%57%45%39%53%62%41% Procurement Constraints/Limitations56%54%43%48%44%58%45% Industry Partner Skill Sets53%64%67%50%63%67%53% Uncertainty About Risk48%59%53%39%38%67%39% Uncertainty about Compensation Structure 47%56%60%38%31%65%37% Lack of Trust in Industry Partners38%36%33%24%26%38%30% Lack of Necessary Skills34%25%24%10%22%29%18% Lack of Info About Process29%28%20%25%36%32%22% Lack Appropriate Technology34%21%18%13%22%26%17%  Owners are the least likely to believe that lack of support by the industry is a barrier to IPD. The remaining segments view it as a barrier.

17 Lack of trust, lack of skills, lack of information about process and lack of appropriate technology are not significant barriers for most segments. Confidential Owner (n=137) Architect (n=708) Engineer (n=60) Contractor (n=137) Sub- contractor (n=32)* Know- ledgeable (n=583) Experienced (n=480) Lack of Legal Precedent61%67%57%52%53%76%47% Industry Partner Support Not There47%58%63%52%59%62%48% Lack of Insurance46%57%45%39%53%62%41% Procurement Constraints/Limitations56%54%43%48%44%58%45% Industry Partner Skill Sets53%64%67%50%63%67%53% Uncertainty About Risk48%59%53%39%38%67%39% Uncertainty about Compensation Structure 47%56%60%38%31%65%37% Lack of Trust in Industry Partners38%36%33%24%26%38%30% Lack of Necessary Skills34%25%24%10%22%29%18% Lack of Info About Process29%28%20%25%36%32%22% Lack Appropriate Technology34%21%18%13%22%26%17%  Owners are the least likely to believe that lack of support by the industry is a barrier to IPD. The remaining segments view it as a barrier.

projects: over 30% behind schedule and over budget Source: AIA Survey 2008

19 Source: AIA Survey % of DBB projects behind schedule 22% of IPD projects behind schedule 62% of DBB projects on or ahead 78% of IPD projects on or ahead

20 Source: AIA Survey % of DBB projects over budget 25% of IPD projects over budget 63% of DBB projects on or under budget 75% of IPD projects on or under budget

IPD projects: overages drop by almost 2/3 Source: AIA Survey % of IPD projects on or ahead of schedule 86% of IPD projects on or under budget

22 BIM appears to be influential in the success of IPD projects. Confidential Base: Experienced with IPD n=488 Base: Experienced/Project included BIM n=254

23 Sustainability goals are common in IPD projects, and appear to be influential in achieving sustainability goals. Confidential Base: Experienced with IPD n=488 Base: Experienced/Project included Sustainability Goals n=336

24 Source: AIA Survey % 16% 4% 10% 14%

25 Anecdotal but driving to quantitative IPD seen as influential in accomplishing sustainability goals Collaborative models establish stronger goals Implementing complex sustainability strategies is best accomplished with more stakeholders Connections to Sustainability

26 50to50 |

27 50 specific strategies to move toward carbon reduction. A how-to resource for practitioners and others. Text, diagrams, and images. 50to50

28 agreements

29 Transitional Forms | B195, A195, A295 More recognizable, familiar Utilizes GMP contract with pre-construction services Immediately familiar and usable within today’s environment SPE – Full Integration | C195 More provocative, unique approach Single Purpose Entity (Limited Liability Company) All for one and one for all IPD Agreements – Two Approaches

30 GMP Amendment Owner Architect Agreement Business Terms General Conditions All Responsibilities of Owner, Architect and Contractor for All Phases of Design and Construction Owner Contractor Agreement Business Terms A295 Transitional IPD Forms

31 Owner C C C C A CM SPE SPE Contract Structure 1 1. SPE Agreement 2. SPE Member Services Agreement SPE Owner Agreement 3 4. Non-Member Agreement

32 Structures the SPE Provides for SPE management Includes procedure for establishing Target Cost Contains Dispute Resolution provision CM O A Owner Construction Manager Architect SPE SPE Agreement – C195

33 Owner Funds SPE Owner Audit Rights Limitation of Liability, Indemnification and Waiver of Claims All disputes resolved under SPE dispute resolution provisions CM A SPE Owner SPE Owner Agreement – C196

34 Services at Cost Incentive and Goal Achievement Comp. SPE has Audit Rights Limitation of Liability, Indemnification and Waiver of Claims All disputes resolved under SPE dispute resolution provisions SPE CM A Owner SPE Member Services Agreement – C196

35 With Non-Member consultants and contractors Contracts for stipulated sum or GMP C C C C Owner SPE CM A SPE Non-Member Agreements

36 E202: BIM Protocol Exhibit

37 Phase UniFormat 300 Series Level of Development Model Element Author Notes

38 Key Definitions Coordination Model Standards Ownership

39 Model Management

40 Levels of Development LOD 100: Massing content indicative of volume, location, and orientation. LOD 200: Generalized systems or assemblies with approximate quantities. LOD 300: Specific assemblies accurate in terms of quantity, size, shape, location, and orientation. LOD 400: LOD 300 with fabrication, assembly and detailing information added. LOD 500: “Record Model”

41 Flow-down

42 Traditional Delivery

43 Integrated Project Delivery

44 Non-UniFormat Elements

MHC SmartMarket Report xPT Whitepaper Consensus opinions about industry change from owners, contractors, and architects

46 Coming soon! On Compensation: Considerations for Teams in a Transformed Industry Outline Introduction Motivations of Team Members: Why Do We Do This Compensation for What: Ingredients of Compensation Current Compensation Models New Value Propositions Appendix A: Three Sample Models Appendix B: FAQs about Compensation

47