Obtaining early input from architects, engineers, and contractors can be a significant contributor to the success of major healthcare capital projects. Participation of construction professionals in the front-end planning of projects can be accomplished using various contract formats that include design-build/design-assist, pre-construction services, not to exceed (NTE), and guaranteed maximum price (GMP). By incorporating and utilizing resources early in the design and construction process, healthcare clients can enhance accuracy and buy-in to key project success factors such as budget and schedule. Benefits of contractor early involvement in major healthcare capital projects include:
1. Common goals and aligned incentives. Early involvement and teaming of the owner, architect, and contractor on a project facilitates a true partnership, yielding common goals and aligned incentives. Shared project development contributes to expedited and successful project execution and delivery.
2. Limiting of change orders. Rather than traditional project delivery methods where the owner warrants the design, in design-build or other early involvement methods, the designer, owner, and contractor work together from the onset of the project to manage the project, therefore reducing unplanned changes.
3. Reduction of design conflicts and constructability issues. By bringing a contractor into the early design phases, many conflicts and constructability issues can be reduced by utilizing building expertise. In addition, shared use of Building Information Modeling (BIM) allows for specific design management and alternative approaches to avoid costly changes in the field. Risk is mitigated through building the project before any dirt is moved or walls taken down.
4. A firm price. By providing multiple real-time estimates as the design develops, the contractor can help reduce budget surprises and drive the project to the desired budget. Moreover, use of not to exceed (NTE) and guaranteed maximum price (GMP) contracts can “cap” the budget, allow for early financing, and align incentives to project cost.
5. Creativity and innovation. Contractors are in touch with advances and innovations in the construction industry and can bring suggestions for alternative building methods such as pre-fabricated components, alternative building management systems, and energy-saving ideas. Early project “value engineering” can help lower overall cost while maintaining building structural and service integrity.
6. Faster start and earlier delivery schedule. Early familiarity with the project reduces a contractor’s learning curve to mobilize and execute the work, often providing significant schedule advantages. Further, the “team approach“ allows commitment and release of site, foundation, and structural packages as the remainder of the project design moves along.
7. Successful Achievement of “Green” Project Goals. A sophisticated contractor will become an extension of the design team in providing the early phase analysis required to deliver a sustainable and environmentally conscious facility. Among the most useful services is the provision of realistic life cycle costs for the various building systems.
A nationwide construction industry study conducted by construction faculty at Penn State University concluded that early involvement of construction professionals under a design-build arrangement is one of the most economical and efficient project delivery methods today. The findings included:
– Unit costs were approximately 4.5% to 6% less than traditional project delivery methods
– Projects were constructed 7% to 12% faster than traditional project delivery methods
– Projects were delivered to the owner 23% to 33% faster than traditional methods
– Projects exceeded quality expectations at all levels
Early input and involvement of contractors and construction professionals in major healthcare capital projects can yield substantial cost and time savings and help deliver a higher quality facility. Owners should seek out contractors and construction professionals that possess the unique talents and desire to work collaboratively early in project development.
