Construction Procurement: How to Deliver Large Infrastructure Projects—A Simple Model

Implementation of large capital improvements projects is challenging. Municipal owners face large challenges in the installation of infrastructure to meet long-term needs. This type of project means construction and millions (or even billions) of dollars of public money. Owners face the daunting task of making the right decision as good stewards of the public resources with many competing interests vying for attention. When faced with large infrastructure projects, advice from many interested parties often can make the decision-making process even more stressful. Owners must weigh many variables to determine the best path forward with the standard triad of schedule, budget, and quality as the driving forces of the process. As an aid to owners in making the decision about how to procure construction contracts, a tool has been developed to allow cost, schedule, quality, and risk to drive the decision. Typical project delivery methods include: (1) Design bid build—traditional construction method that maximizes the owner’s control of the project. Cost is often optimized at the expense of schedule and, potentially, quality. (2) Competitive sealed proposal—a traditional construction method with an updated procurement selection that improves on quality and schedule. (3) Construction manager at risk—owners’ risk is managed in this method. Quality is high, and schedule can be greatly improved. Cost is usually higher. (4) Design build—schedule is maximized in this delivery method. Quality is high, and cost is usually higher as well. Other factors that may be included in deciding on procurement and delivery include owner selected and assigned equipment, prepurchase of equipment, and multiple project delivery methods. The paper provides a careful description of each delivery method and provides some examples of good uses of each delivery method. The next step covered in the paper is the use of a simplified tool to allow owners and consultants to answer some project-related questions to identify the key drivers for the project (risk, schedule, cost, and quality) and then assign a value to these items to help guide the decision-making process for large capital improvements projects.