Like perfectly matched dance partners, Building Information Modeling (BIM) and Integrated Project Delivery (IPD) contracts seem made for each other. With the release by the Canadian Contracts Construction Documents Committee of its CCDC 30 IPD Contract in early 2019, both have been blended into an integrated, collaborative building model.
BIM is described by leading authors as “the process of creating and using digital models for design, construction and/or operations of projects.” Over recent years, BIM has become the new normal in project development, now incorporating all manner of digital information such as 4D and 5D modelling, and used to co-ordinate scheduling, costing and product data.
IPD contracts have been around since the 1950s. The American Institute of Architects California defines IPD as an approach that “integrates people, systems, business structures and practices into a process that collaboratively harnesses the talents and insights of all participants to reduce waste and maximize efficiency through all phases of design, fabrication and construction.”
According to Dr. Joseph Wright of the University of Wisconsin, “BIM and IPD are complementary tools: BIM facilitates the integration of information and provides a single platform for the storage and retrieval of data, and IPD provides a framework to integrate the shared goals and values of the project participants.”
“The greater use of BIM and IPD has been forced on the industry by owners’ demand,” Wright says.
Owners want a design and construction process offering a more co-operative and non-adversarial relationship among the members of the project team. “They demand better value for money and less wastage of resources as the new norm for the construction industry.”
Tim Sportschuetz of Singleton Urquhart Reynolds Vogel LLP says while Canada has been slower to adapt to IPD than Europe and the United States, this could all change with CCDC 30.
“CCDC 30 is nothing short of revolutionary and will reshape the Canadian construction industry landscape. In stark contrast to the traditional top-down approach, IPD leverages an integrated and collaborative model. IPD achieves this by organizing the owner, contractor, consultant(s), construction manager(s), subcontractors and material suppliers into a cohesive team structure under a single multi-party construction contract.”
CCDC 30 first outlines the three-tiered project management structure of an IPD project. The Senior Management Team (SMT) functions like a board of directors. The Project Management Team (PMT) guides the project’s collaborative planning, design and construction of the project in order to achieve project objectives.
Sportschuetz describes the Project Implementation Team (PIT) as an interdisciplinary, cross-functional team organized by the PMT, and consists of consultant, contractor, subcontractor, material supplier, and subconsultant representatives.
CCDC 30 then identities four key phases within the project’s execution: validation, design/procurement, construction and warranty.
“It is of utmost importance to stress the significance of Building Information Modeling throughout the validation and design/procurement phases,” says Sportschuetz.
Key to the CCDC 30 IPD is the sharing of risk among project partners.
“The pricing structure is cost plus with a target price,” the CCDC explains. It’s called the Risk Pool. “The profits of the design/construction team are identified and allocated to a risk pool that remains at risk subject to the achievement of mutually agreed project objectives.”
Sportschuetz details the partners’ shared responsibility for delivering the project within the limits defined by the owner’s budget.
“After careful and transparent cost-planning sessions, the design/construction team agrees on a collective profit number based on the final target cost. If, at the end of the project, profit remains in the risk pool, each IPD participant receives its pre-determined profit share. Since all parties to the CCDC 30 have waived claims as against each other, everyone must work together to efficiently and cost-effectively overcome delays and remedy deficiencies and defects.”
In combination with BIM, the CCDC 30 IPD offers the construction industry a new collaborative paradigm that incentivizes the sharing of information and profits while achieving the optimal result for the owner.
John Bleasby is a Coldwater, Ont.-based freelance writer. Send comments and Legal Notes column ideas to editor@dailycommercialnews.com.
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