The “Design and Manage” procurement route is presented as an evolution or modification of the traditional Design and Build (D&B) method. D&B is characterized by a single entity undertaking responsibility for both the design and construction phases of a project, typically under a single contract. Design and Manage builds upon this integrated approach by placing a specific emphasis on the management of the construction works and introducing variations in how these works are contracted and managed, predominantly concerning the level of client involvement and the allocation of responsibility. It can be viewed as an attempt to address certain perceived limitations of standard D&B, such as potentially limited client control over design details or the selection of subcontractors.
Design and Manage with Single-Point Responsibility
Design and Manage with Single-Point Responsibility is a variant that retains the core principle of D&B by having a single contractor responsible for the overall delivery of the project, encompassing both the design and the management of the construction works. Under this arrangement, a single “design and manage contractor” assumes this comprehensive responsibility. However, the actual construction work is executed by a number of package contractors (i.e., subcontractors) who are contracted to this design and manage contractor.
Features of D&M with Single-Point Responsibility
A key characteristic of this variant is that the payments made to these package contractors by the design and manage contractor are often reimbursed by the client based on a cost-plus contract arrangement. This cost-plus element introduces a degree of financial transparency regarding the subcontractor costs for the client. Given that the client ultimately reimburses these costs, it is considered reasonable for the client to have a say in the selection of these package contractors. This client involvement in subcontractor selection is a significant feature that distinguishes this variant from a standard D&B approach, where the contractor typically has full autonomy over subcontractor selection. Furthermore, certain design work itself may be structured as separate packages, particularly if the client wishes to have specific input into the selection of design consultants for particular aspects of the project. This provides an additional layer of flexibility and potential client influence within the single-point responsibility framework.
This approach to Design and Manage seeks to combine the efficiency and single-point accountability of D&B with the transparency and client influence over subcontractor selection often associated with Management Contracting. It presents a hybrid model that could be appealing to clients who desire a single point of contact for the entire project but also wish to have a voice in the selection of key subcontractors.
Key characteristics include the single-point responsibility of the design and manage contractor for both design and construction management. The client operates under a cost-plus reimbursement model for subcontractors, directly reimbursing the design and manage contractor for these costs. A notable feature is the client’s influence on subcontractor selection, allowing them to have a say in who is chosen for the works packages. The design and manage contractor might have potential limitations on their liability for the project. There is also flexibility in design packaging, with some design elements potentially being separate packages where the client can influence consultant selection. This method shares similarities with the role of a Management Contractor, particularly in the early involvement and use of package contractors. It is often considered suitable for complex or fast-track projects where a single point of contact is advantageous. The structure can also foster a collaborative relationship between the design and manage contractor and the client.
Advantages of D&M with Single-Point Responsibility
Advantages of this approach include the simplified client management due to a single point of contact and responsibility. The client’s influence on subcontractors allows them to choose preferred firms. The transparency in subcontractor costs provided by the cost-plus model can be beneficial. The integrated nature can lead to potential for reduced delays through better communication and coordination. It offers flexibility for complex and fast-track projects and can promote a collaborative environment.
Disadvantages of D&M with Single-Point Responsibility
Disadvantages include the lack of an established contract sum initially, similar to Management Contracting. There is a potential for duplication of resources between the main contractor and subcontractors. The risk of liability limitations for the main contractor needs to be carefully considered by the client. The project’s success relies heavily on the expertise of the design and manage contractor in both design and management. Finally, there is still a potential for conflicts to arise between the main contractor and the various subcontractors.
Design and Manage with Multi-Point Responsibility
Another variation of the Design and Manage procurement route involves a structure where the package contractors are directly contracted to the client. In this model, the Design and Manage Contractor assumes a role more akin to a consultant to the client, taking on full responsibility for the design of the project and the overall management of the construction work. However, unlike the single-point responsibility variant, the package contractors, while managed by the Design and Manage Contractor, are directly responsible and contractually obligated to the client.
Due to the multi-point responsibility arising from the client’s direct contracts with the package contractors, paradoxically, this Design and Manage method falls under Separated Procurement System designs but also exhibits features of Integrated Procurement System designs. This mix of features stems from the integration of design and overall construction management under a single Design and Manage Contractor, while the execution of the construction work is managed through separate contracts held by the client. Evolution of this arrangement from regular D&B is similar to the evolution of Construction Management from the Conventional Method, where the client also holds direct contracts with trade contractors but employs a CM for coordination.
Features of D&M with Multi-Point Responsibility
Key characteristics of this variant include the multi-point responsibility where the client directly contracts with package contractors. The Design and Manage Contractor acts as a consultant with design responsibility, overseeing both design and overall management. The package contractors are directly responsible to the client for their work. This model presents a hybrid procurement system, blending features of separated and integrated approaches. It bears a strong parallel to Construction Management, where the client also leads the contracts.
Advantages of D&M with Multi-Point Responsibility
Advantages of this approach include the client’s control over contractors through direct contractual relationships. There is a single point of responsibility for design and management strategy with the Design and Manage Contractor overseeing these aspects. The client enjoys transparency in contractor costs by directly managing payments. There is also a potential for cost savings through direct contracting and management.
Disadvantages of D&M with Multi-Point Responsibility
Disadvantages include the high administrative burden for the client in managing multiple contracts. There is a risk of coordination issues as the client is responsible for coordinating multiple contractors. The approach relies on client expertise in managing construction contracts. Finally, there is a potential for conflicts between different contractors and the Design and Manage contractor.