Thursday, November 6, 2008

Achieving IPD in 3D™

Achieving IPD in 3D

Achieving Integrated Project Decisions, Design and Delivery through

Collaborative Agreements, Building Information Models and

Lean Construction Methods

copyright 2008

By James L. Salmon, President and Founder of Collaborative Construction Resources, LLC

The Integrated Revolution

Building Information Model software, advanced hardware, lean construction methods and related business process improvements enable Integrated Project Delivery that saves time and money while improving building quality. Integrated Project Delivery (IPD) is revolutionizing the US Building Industry.

One critical element in the successful implementation of IPD is the ability for professionals to quickly see problems and solutions through visual relational databases that are known in our industry as Building Information Models (BIM). When combined with proven lean construction methods and techniques, - which are an outgrowth of the lean manufacturing techniques Toyota brought to the US Automotive Industry and commonly referred to in the building industry as Lean Construction - BIM produces phenomenal results.

BIM and Lean Construction dramatically improve business processes and enhance productive and profitable collaboration among industry professionals whose interests have traditionally been adverse. The advanced visuals and professional collaboration inherent in BIM and Lean Construction have lead to another critical element; new contracts (Collaborative Agreements) that enhance confidence in these new business processes, reduce risks and increase rewards. Deploying BIM and Lean Construction methods through Collaborative Agreements in an IPD environment results in IPD in 3D™.

Success of IPD in 3D Teams™

IPD in 3D™ is the innovative project delivery model advocated by Collaborative Construction Resources and bolstered by a new generation of Collaborative Agreements. IPD in 3D™ is empowering owners, designers, contractors and others involved in the building industry to use new visualization tools and processes with confidence. IPD in 3D™ also empowers stakeholders to achieve integrated decisions, design and delivery, all of which are critical for successful under any IPD model.

IPD in 3D™ enables proactive use of information-rich BIM and proven Lean Construction methods within the framework of a new generation of Collaborative Agreements to create graphic representations of key project data that prompt better decisions, more complete and timely designs and more efficient delivery and production. IPD in 3D Teams™ that utilize these powerful tools save time and money while improving quality.

Government reports, industry BIM Awards, and independent academic case studies prove integration produces high-quality projects on-time and under-budget. Sophisticated consumers of complex design and construction services are demanding collaborative teams utilize integrated decision making processes to enhance design and delivery, which in turn saves time and money and increases in quality.

Intelligent and effective use of these powerful new tools and processes requires new legal instruments. Over the past several years, a new generation of legal agreements known as collaborative or integrated agreements has begun to emerge.

Insurance industry statistics confirm that approximately 80% of all construction claims originate with owners or members of the project team. Contractual provisions that substantially reduce the number of such claims via contractual waivers and laddered collaborative dispute resolution mechanism will, at a minimum, reduce litigation and premiums. But use of these innovative Collaborative Agreements in an IPD in 3D™ environment have the potential to revolutionize project delivery in many other important ways.

Collaborative Agreements Expand the IPD in 3D™ Toolbox

Integrated Project Delivery has been touted in the U.S. building industry for many years. Only recently, however, have the disparate legal, design and construction communities coalesced behind a project delivery model that empowers committed stakeholders to take advantage of design and delivery innovations simultaneously. The keystone that supports the effective and simultaneous use of innovations manifested in BIM and Lean Construction methods is the new generation of Collaborative Agreements.

The ConsensusDOCS 300 Standard Form of Tri-Party Agreement for Integrated Project Delivery, released in September, 2007, was the first such agreement released nationally and was quickly followed by similar offerings from the American Institute of Architects (AIA). The Integrated Project Delivery Guide, (IPDG) created by the AIA California Council and published nationally by AIA, provides a good overview of Integrated Project Delivery concepts and serves as a backbone for the AIA’s new General Conditions Document, AIA A295-2008 and the latest generation of AIA IPD Documents released October 17, 2008.

Collaborative Agreements recognize and leverage the critical nature of parties’ relationships. This new generation of agreements is based on existing and valued relationships while traditional transactional agreements create legal relationships without reference to the quality of the underlying relationships.

Collaborative Agreements deployed in an IPD in 3D™ environment enable use of advanced visualization tools to align economic interests for the benefit of trusted business relationships over time. Key provisions include those that call for waiver of claims related to decisions made by consensus, laddered dispute resolution mechanisms, the use of third party independents as dispute reviewers and the use of “pain share-gain share agreements.”

Traditional contracts can be modified to include or accommodate many of these approaches but are often executed with no such modifications.

Waiver of claims for consequential damages related to decisions made by consensus is a critical feature of a fully functional Collaborative Agreement. Such waivers do not mean the parties will never disagree or have disputes, it simply means that an entire category of claims will be eliminated by consensus of the parties and claims that do surface among the parties will be resolved through predetermined steps outlined in “laddered” Alternative Dispute Resolution (ADR) provisions contained in the Collaborative Agreement.

Laddered ADR clauses are not new, but the use of an Independent Dispute Reviewer or a Dispute Review Board as a step on the ladder is more unique. ADR mechanisms can be rendered even more effective if the parties agree to forego traditional litigation and adopt binding mediation / arbitration as the ADR mechanism on a project wide basis.

Binding subcontractors to these innovative resolution mechanisms can be a bit tricky as lien statutes in most states bar parties from waiving their lien enforcement rights. Good local counsel can help you craft joining agreement that address these issues, and still bring your subcontractors on board as collaborative members of an IPD in 3D Team™.

Pain share gain share agreements are another key to the success of an IPD in 3D Team™ and are an excellent mechanism for aligning economic interests of team members in advance and ensuring all parties are working together to achieve integrated delivery in ways that optimize the whole, rather than the disparate parts. These agreements are complex, but well worth the effort.

Building Trust is Critical to Achieving IPD in 3D™

IPD in 3D™ is best implemented on projects with authentic collaborative teams formed at the insistence of enlightened owners willing to invest in high quality planning, design, production and delivery efforts. IPD in 3D Teams™ cannot be formed in the absence of trust. Collaboration and trust cannot be established in a vacuum and require committed stakeholders who clearly see the potential rewards of their collaborative efforts.

None of the tools necessary to achieve IPD in 3D™ can be successfully deployed in the absence of open and honest communications among IPD in 3D Team Members™. Building trust among IPD in 3D Team Members™ is a difficult, but critical process.

Trust is the foundation for organizational commitment to any collaborative endeavor. Collaborative teams, especially of the caliber required to achieve IPD in 3D™ must build trust among the various team members.

The new generation of Collaborative Agreements that form the contractual framework for IPD in 3D™ are a PRODUCT of the parties trusted business relationships, not the BASIS for those trusted business relationships.

Consumers of Building Industry Services will Benefit from IPD in 3D™

Sophisticated consumers of building industry services see increased efficiency and productivity in almost every other sector of the economy. They are stunned and dismayed when the construction industry insists on delivering services in accordance with project delivery methods that date to business processes developed in the aftermath of World War II.

Collaborative enterprises that develop a high level of trust among team members are better positioned to act in their combined strategic interests and to successfully respond to evolving economic and technological environments. Experienced project managers consistently confirm trust is important to successful project delivery.

IPD in 3D™ and the innovative tools required to achieve it offer a foundation from which IPD in 3D Team Members™ can pursue trust based business methods.

Entities and persons who deliver design, construction, maintenance and others services to the building industry must adapt to the use of innovative new tools that increase efficiency and productivity or find themselves and their companies at a competitive disadvantage. Those who master these tools will have a competitive advantage in the dramatically changing economic market place. Those who don’t will fail.


James L. Salmon, Esq. President and Founder, Collaborative Construction Resources, LLC is a strategic and collaborative consultant and the creator of the IPD in 3D™ concepts described in this article. Salmon advocates the use of advanced BIM technologies, Lean Construction methods, Collaborative Agreements and other IPD in 3D™ processes for the benefit of the building industry. His Collaborative BIM Advocates group provides free membership, national networking opportunities, custom symposiums and online webinars.

James Salmon, Esq would like to thank Michael Bordenaro, Co-Founder of the BIM Education Co-op™ for editing assistance with this article.

Phone: 859-802-1118
Skype: JameswithCCR

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