Why The Consensus Agreement is the Cornerstone of Successful IPD Projects

Integrated Projected Delivery can be extremely powerful with the right agreement in place. The key to unlocking to the potential of an Integrated Project Delivery (IPD) undertaking lies in the use of the consensus agreement. My experience as lead architect on projects such as the Johnson Center for Science and Community Life at North Park University has shown that such agreements are essential for IPD projects.

Potentially, IPD aligns interests to one set of values. It orients problem-solving to what’s best for the project, not what’s most convenient for a team member. All stakeholders participate in scheduling decisions and it results in better schedule resolution. Ultimately, this delivers a better value for the money for the client. It’s really the single multi-party contract (which I call the consensus agreement) that makes this possible. In the case of the Johnson Center, parties subject to the contract included Stantec, W.B. Olson construction, Boldt, Jamerson & Bauwens Electric, Hill Mechanical and NPU.

So, why the consensus agreement? And what does it say? What the consensus document ultimately provides is an open partnership that reinforces full-time collaboration. The spirit of the document removes traditional design-construction barriers. The alignment of goals and clarity of communication leads to a better and more efficient less conflicted process. The beauty of this consensus agreement is that it allows for component design. In contrast to a more traditional design-bid-build approach in which services are bid on and contracted for separately, in this consensus approach, the architect-owner-builder and subcontractors form a team.

On the Johnson Center project, we collectively signed a consensus agreement, enabling us to establish component design teams and to purchase pre-design services and component systems together as a team. The beauty of the approach was that designers and builders fully collaborated in the discovery of concerns, opportunities, and solutions. This type of contract also gave us the ability to create value enhancements. Component teams, engaged in collective conversation, articulated their needs. With this more open communication, we were able to talk about the method of construction, the sequence of construction, component selection and get the best value for the money. I’ve found that with this system, we are able to obtain a high quality product at a price that’s fair.

Take the exterior wall component, for example. The enclosure team included: the architect, the structural engineer, owner, builder, owner’s representative, window wall subcontractor, structural subcontractor, light gage framing subcontractor, Terra Cotta installer, Terra Cotta manufacturer and roofing subcontractor. Our team chose a particular Terra Cotta window wall system together. The agreement gave us the ability to discuss the pros and cons of various systems openly and select the best quality fit for our design at a price that made sense within the scope of the project. As a result of stakeholder meetings on the Johnson Center project, we made changes in the method of skin support. We were able to collectively agree on the framing strategy and lateral resistance systems. As a result, we were able to remove conflicts, tighten construction tolerances and save time and money. There was no re-design.

Why does this contractual arrangement make such a difference you might wonder? It changes the nature of the relationships in the project. It creates a team with an interest in producing the best building possible within the budget. It frees up stakeholders. They don’t have to be as protective of their interests. On the team, they’re not afraid to share incomplete information. This is important in finding the best solution. We can examine several options and, as a group with shared interests this makes for a more collaborative and communicative process. With an open forum, we can discuss pros and cons of components, such as the type of windows available. They’re not at risk. The team member’s fee is tied to a scope of service, not a percentage of the cost of the component. As a team member, you’re not disinclined to save money, but rather guaranteed profit. There is no pressure for change orders as the business proposition is fully vetted and open. There is no need to conceal. On the contrary, “feeling safe” allows the participants to bring the unknown into the known and the hidden into the open. It’s worth saying that Lean thinking goes hand in hand with this type of contractual arrangement.

Unburdened, we can share the thought process behind the design and construction choices rather than just the documents. Also important, builders can more deeply understand the intent of the architect—and the architect has a chance to hear their concerns. Building with respect for and understanding of the design is much better than building with incomplete and hidden information. Of course, this system takes some time getting used to and it breaks down if one of the participants comes to the table wearing a poker face. It’s totally open, and you have to have trust to make it work.

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