By Henry Purdy, Vice President of Product Management, iSqFt
Given the traditionally slim profit margins and high financial risks in commercial construction, it’s no surprise that people in the industry are always looking for new ways to manage the construction process.
But there’s one you may not have heard of yet that’s taking a different look at how things get done. It’s called Integrated Project Delivery, or IPD, and I thought it would be worth going into, at least at a high level.
What is Integrated Project Delivery?
IPD steers clear of the top-down structure of project planning, in which the architect designs in one silo, the general contractor manages the project in its silo, and then the subcontractor deals with the realities on the ground.
The problem this aims to resolve is one of communication that often leads to delays, budget overruns, and change orders. But IPD changes all that by getting all the key players in the same room–literally or at least figuratively–to look over the plans as they’re created. Although this clearly makes more sense for, say, a hospital than a warehouse, there are times when slightly higher up-front costs and longer development cycles on commercial construction projects will save money by reducing errors and changes.
Imagine that a project owner wants to build a hospital. In the IPD model, he or she would gather an architect and additional design consultants, a general contractor, and subcontractors who will be doing some of the most complex and extensive work. Those trades can vary from project to project, but hospitals have notoriously complex HVAC systems, so we can start there.
IPD makes sure that everyone sees what’s happening as the building is designed and can call out potential conflicts along the way. This drastically reduces the need for change orders as the project moves forward, but it also is possibly the most agile way to build. Changes can be made on the fly, as needed, with all the experts weighing in.
Is this the wave of the future? Is this how all buildings will be built? Maybe.
For the project owner, it’s a leap of faith, and some have a higher tolerance for risk than others. Until we have lots of data for this, and can prove on the bottom line that this is a better way to build, we’re just going to have to wait and see. But there is something working in its favor.
In the IPD model, the financial risks and rewards can be shared among all key players, including subcontractors. It may not be an equal share, but if the building process is profitable, everyone profits. That’s a pretty powerful incentive.
This method is clearly more collaborative, more egalitarian, and, potentially, more efficient. So I have a few questions:
- If you’re a subcontractor, does this appeal to you? Have you ever worked on an IPD project?
- If you’re a general contractor, and you haven’t used IPD, are you interested? If you have used IPD, how did it go?
- For architects, is IPD a help or a hindrance for project design?
In other words, I’d love to hear your thoughts about IPD, whether you find it interesting, and if you’ve already found it to be effective.
 If you’d like a more in-depth look at IPD and other project delivery systems, the AGC of America offers a great resource: http://www.aia.org/aiaucmp/groups/aia/documents/pdf/aiab093116.pdf