Collaborating with Contractors for Innovative Architecture

With construction more complex than ever, architecture firms are joining forces with construction experts to solve tough problems and innovate. The key is to understand the benefits—and challenges—of architect-contractor partnerships

10/2006

Since the dawn of the profession, the best architecture has been created in close association with construction professionals. That’s no surprise. Today, however, alliances between designers and builders are getting tighter and more pervasive. Buildings are more complex than ever, and the knowledge needed to build them well is increasingly in the hands of specialized builders, fabricators and manufacturers. Closest to the source are construction managers and general and specialty contractors. By building on the constructor’s experience—literally—savvy architects are producing innovative, best-in-breed architecture.

Trends and statistics bear out this tendency. A new generation of younger architects is embracing design-build, the formal and contractual union of the two fields. At the avant-garde end of the spectrum, architects like Frank Gehry and Thom Mayne have fashioned unique work models built on early and deep alliances with contractors. And “serial builders” like banks and franchise retailers have shown their preference for marriages of constructors and conceptualists to ensure both visual impact and bottom-line performance.

	Terra cotta column capitals constructed with original terra cotta and placed on a trailer to be shipped to the jobsite for installation on the Utah State Capitol. Photo courtesy of Kepco+

For technically demanding projects, designers and builders are practically joined at the hip. Under the direction of Robert Fraga, for example, the U.S. Postal Service dealt with such high-risk projects as the clean-up of its anthrax-tainted Brentwood facility in Washington, D.C., by employing novel partnerships of design firms and builders. Complex restoration projects bring specialty contractors into the mix during schematics, as at the Utah State Capitol’s terra-cotta dome restoration; there, a stone-panel specialist was retained even before the architect was. Across the board, when building projects are large or complex, the most successful project teams boast of formal and informal collaboration structures.

Industry groups recognize the trend, too: The AIA recently joined the Associated General Contractors of America (AGC) and the Construction Users Roundtable (CURT), an owner’s group, to announce a new collaborative working group to spearhead industry transformation. “This undertaking represents an unprecedented level of collaboration between building owners, designers, and contractors,” says Norman Strong, FAIA, an AIA Vice President and managing partner at The Miller Hull Partnership, Seattle.

The transformation has already begun. A desire to tame cost and schedule is driving the trend, but so is the possibility of breakthrough solutions. Architects realize that by working more closely with contractors earlier and throughout the project cycle, they stand to gain more—and lose less.

Endorsing Collaboration

Though it’s more common and customary, architect-contractor collaboration is by no means limited to a single model. There are many paths to success, with partnerships ranging from legal joint ventures and design-assist contracts to informal marketing and advisory affiliations.

Yet many architects—armed with advice from lawyers, insurers, and senior partners—still shun close associations with contractors. Many will gladly seek advice from favored contractors—in return, perhaps, for a good word to the owner during bid reviews. But why, they ask, should architects compromise their independence and expose themselves to added risk?

	In a retail rollout the branches may all be unique, but the themes and materials and construction techniques remain somewhat consistent for the client’s look and brand. Photo courtesy of Barneys New York/Adrian Wilson, photographer.

Timing maximizes those benefits, adds Robert Fraga, president of the Construction Managers Association of America and former facilities portfolio manager for the U.S. Postal Service who just joined the GSA as assistant commissioner for capital construction program management. “Try to bring in the contractor as early as possible, because they have a great deal of knowledge that designers don’t have and they’re typically in tune with market conditions and cost,” he explains.

And innovation comes in surprising places, such as site logistics and alternative methods, adds Boyd Black, director of project management services for the University of Illinois at Chicago and a board member of the Construction Owners Association of America. “These are things that architects don’t have first-hand knowledge of, and they can lead to some very creative solutions,” says Black. “The contractor has a very down-to-earth, practical role.”

Whether for multiple midsized projects or a national franchise rollout, when the projects are numerous and repetitive such architect-contractor collaborations uncover useful efficiencies, says Robert W. Mullen, CEO of New York City-based Structure Tone. “In a retail rollout the branches may all be unique, but the themes and materials and construction techniques remain somewhat consistent for the client’s look and brand,” says Mullen. A retail owner might hire a CM who then selects local contractors as partners and hones the delivery process through each iteration. “It’s a prime opportunity to create an assembly-line approach, so that the project team just keeps getting better and better,” he adds.

Reducing Risk

Beyond a better grasp of materials and techniques, Thomsen adds a second reason to collaborate closely: “Things always go wrong, so you want to have that trusting relationship.”

The bottom-line savings of earning a contractor’s confidence can be significant. “Risk is a big concern for contractors,” says Fraga. “Think of risk as dollars: Shifting all the risk to somebody else just costs the owner a lot more money.”

Partnering with contractors also helps minimize uncertainty on the job site, adds Mullen, such as by fine-tuning the subcontractor and materials selection processes or by creating more comprehensive insurance programs. “It can extend to labor solutions as well, by minimizing field labor and maximizing off-site work when you can,” he explains. “That’s certainly an important topic in the very active, busy construction markets across the country that aren’t matched by gains in the workforce.”

Insurers concur that collaborative structures and activities reduce risk, and many offer reduced bonding costs and lower deductibles for professional liability insurance if the project requires such teamwork. Examples include “risk-mitigation” credits granted to project teams that perform a joint constructability review before work begins, as well as credits available for when a submittal management process is in place or when scheduling milestones are met. “Insurers would like as many subs as available and the owner involved in project planning, so they can talk about long lead items and ways to make things easier to construct,” says Lorna Parsons, a managing director for Victor O. Schinnerer Co., Chevy Chase, Maryland. “And we’d like to see them talking about these things while it’s still on paper, long before anyone starts digging holes.”

To get the savings, however, the project team has to work together, says Parsons. “All of the credits require a high level of collaboration between architect and contractor, which we think is beneficial for everybody,” she explains. “When we looked at our largest claims, two-thirds of them are for ‘delays and extras,’ where the project goes over schedule and budget. When the architect and contractor aren’t in synch, big claims are made and only the lawyers win.”

Since many of those costs are ultimately borne by project owners, there’s another market impetus for architects to join forces with contractors: the clientele. Experienced owners may prefer it—or insist on it.

“A lot of an architect’s work is for serial builders who are wondering, ‘What do you do when you have a continuous building program?’” asks Thomsen. “Routine owners need to be savvy,” adds Fraga, citing statistics that 90 percent of projects are undertaken by repeat builders. “All of us in the design-and-construction business want to optimize the facilities supply chain. And it’s getting more complex every day with new technology, safety, and environmental requirements. No single individual can totally control the supply chain, so it is essential—not a luxury—to collaborate.”

Some owners see architects who don’t play well with contractors as a vanishing breed. “Collaborate or die,” Fraga sums up.

Methods for Collaboration

Joining forces with a contractor may seem like an obvious or easy thing to do. But savvy building veterans say it’s filled with nuance.

“They have done Myers-Briggs personality profiles on architects and contractors showing that they have two very different personalities that drive them into their respective professions,” observes G. William Quatman, FAIA, a Kansas City-based lawyer and author specializing in teaming and design-build. “So we’re putting opposites into a room and telling them to cooperate. It’s a challenge that’s bigger than the obvious differences between the two.”

To bring together these disparate world views, Fraga recommends four critical components for successful collaboration:

• Most important: all stakeholders must align their expectations and objectives.
  It has to be a win-win for all stakeholders.”
  
• Communications must be superior for all stakeholders—for expectations as well as systems—so that people can react quickly.”
  
• You have to have negotiations, because conflict is inevitable.”
  
• And the last element is compromise.”
  Risk-averse by nature, many contractors would add a fifth component: timing

“The biggest thing is just getting everyone together and getting ideas and opinions out on the table early, before you get too far down the road and changes can’t be made,” says Bob Durrant, plant and preconstruction services manager with Kepco+, an architectural cladding contractor known for panelized stone. “On a stone job, the earlier you get your blocks and fabricator secured, the better your product’s going to be be. It’s a long-lead item and a lot of people don’t take that into consideration.”

As an example, Durrant cites the Utah State Capitol restoration—a “design-assist” scenario involving a “project definition” phase consisting of workshops and the preparation of a final scope document. According to David H. Hart, AIA, executive director of the state’s Capitol Preservation Board, the process started with an RFP and qualifications-based selection (QBS) for design and construction providers for each contracted portion of work. Those firms that made the first cut received a 300-page “guidelines-and-imperatives” document from the owner, with technical guidelines such as matching existing colors and detail dimensions on the landmark building. Then several firms were short-listed and given a not-to-exceed budget. Each team was paid a fee to detail and design a solution to meet the predetermined budget. All accounting was open-book, with a negotiated process for the bidding phase.

The team with the best solution would be converted to a design-build contract if they could agree on a budget with the board. If not, the state could put out their solution for open bidding. “So there was an incentive for the contractor to get the job,” says Hart.

After architect and contractor were both on board, a three-day-long workshop was held to review the capitol design guidelines and imperatives. Specialty contractors for each trade were brought in to define the full extent of the work. The result was a scope document with about 20 percent construction documents. “The process helped keep scope creep out of the equation and kept us on schedule, with a wonderful synergy from that technical assistance,” says Hart, who calculates that there were only about 1.5 percent change orders for the $170 million project, versus 8 percent to 10 percent for typical state buildings.

Although the construction teams were paid for their design assistance, the Utah State Capitol process represented a tradeoff: Precise collaborative planning required a serious time commitment even before work was awarded. “At times it was frustrating because there was so much involvement, but the outcome was great because we had so much input from the design engineer and the terra cotta manufacturer,” says Durrant. “It was really a good experience.”

Other states and public agencies may find such collaborative options constrained by procurement regulations. According to the AIA Design-Build Knowledge Community, QBS is not allowed in Georgia, Iowa, South Dakota or Wisconsin, for example.

“We would actually like to use the collaborative roles more than we do,” says the University of Illinois’ Black. On large projects, the state permits construction management (CM), allowing Black to bring in the construction firm at same time as the architects and engineers.

The Right Partners, the Right Process

Experts in construction offer two rules for architects interested in collaboration: choose your partners carefully, and tailor your service approach. One well-known international firm, for example, has sought deeper control of its pioneering designs by working closely with specialty contractors in structural steel and titanium cladding. The partnerships inform the firm’s studio structure, information-technology choices, and to some extent, its client list.

“To successfully innovate, it’s important to develop longer-term, better relationships with suppliers and subcontractors,” Fraga observes. “Prequalification is essential to that.”

A prequalification effort should encompass a review of three measures, he explains:

• Capabilities
  
• Past performance
  
• Past experience

Performance can include quantitative measures such as successful completions as well as more qualitative traits, such as the company’s track record of “customer orientation,” Fraga explains. And past experience means types and size of projects as well as specific construction techniques.

Considering possible project outcomes is useful in these situations. “Choose your contractor partner thoughtfully,” adds Parsons. “If they bring in a value engineer and the collaboration between the contractor and the architect is not good, that can damage project or at a minimum increase liability for the architect. And fast-track has a whole set of problems of its own.”

“It’s really a three-way equation: Who fits best with the client, the project type and location, and with the architect culturally, in terms of how the firm services clients and its people’s skills, services and attitudes,” says Mullen.

For a growing number of firms, working together can mean involvement by the architect in shop drawings and fabrication—a nontraditional role that many specialty contractors would rather not consider. To extend the architect’s domain to the shop floor, some firms have adapted CAD/CAM technologies for architectural use. The software allows the firms to coordinate designs directly with key fabricators by interfacing with robotic cutting and milling tools.

This direct transfer of architectural CAD data not only increased the architect’s control of the construction process, but it also reduced the chronic overlap in creating working drawings, says 3D/I’s Thomsen. “I’ve heard estimates from A/E firms that between 30 percent and 60 percent of construction documents are discarded and replaced with shop drawings. That’s as much as 2 percent of the construction cost of the project that we’re throwing away,” he explains. And it’s more than a simple loss of money, he adds: “It’s also a quality loss.”

The idea of having more control and being more productive has propelled architects’ use of building-information modeling, or BIM. And conversely, as Black points out, the availability of BIM software has actually boosted interest in collaborative project delivery. “When you have the contractor involved at the early phases, tools like BIM save time and create a more coordinated product,” says Black.

Yet there are impediments to the widespread use of BIM even though “the benefits are huge,” says Parsons. “The risk is, who controls the software and who is putting pieces of design into it. Will it allow a vendor, for example, to put the specifications in—and is the architect liable for that? Those questions are not answered yet.” Other insurance and legal specialists agree with Parsons that BIM has the potential to go either way. “If it’s not used appropriately,” she cautions, “architects can come up with short end of the stick.”

A recent article in the newsletter Construction Litigation Reporter contends that BIM is more than a technology—it’s an entirely new delivery system. The author, attorney Howard W. Ashcraft Jr., notes that several emerging technologies including BIM are now accelerating the need for collaboration.

Comparing Collaborative Delivery Systems

Which raises the question of project delivery: If a project demands a high level of collaboration, the architect can advise the owner on the optimal method. “The days of design-bid-build as dominant method are going by the wayside,” says Fraga. “Owners need to be sophisticated and have an arsenal of delivery systems.”

Indeed, collaboration with contractors tends to lead to nontraditional approaches, as the traditional hard-bid approach is based on a (hopefully) healthy tension and competition between architect and contractor. In collaborative structures, instead of checks-and-balances there may be mutual incentives. “You share the risks and you share the benefits of the project,” says Fraga. “Instead of firm fixed-price, there can be a guaranteed maximum price, or GMP, where you are audited, so you know what the contractors’ exact costs are.”

Quatman notes that AIA’s most recent position on alternative project delivery has been that architects should lead, regardless of delivery model. “If architects are going to heed the call, they need to take on guaranteed completion, guaranteed cost, indemnity for all kinds of hazards, liquidated damages, OSHA responsibilities and more,” he explains. That’s not common in the marketplace, adds Quatman, “But those who have done it say they’ll never turn back.” To pick the right alternative method, Fraga advises, “Let the project needs dictate the delivery system.”

• Design-Build
Design-build has emerged as the classic collaboration model, and an increasing number of architects swear by it. The contractor remains close at hand from beginning to end, and design and construction professionals speak to the owner as one. “There are lots of versions of design-build that are cost-reimbursable and work real well,” says Thomsen. Benefits include a single point of responsibility for the client and a reduction of change orders and delays.

Architects should take care, however, especially in the more common contractor-led set-up. “That way is most problematic for the architect and can increase your risk,” says Parsons. “If you are hired by a contractor who just needs a seal, they may cut off your construction phase services, and construction administration is your last best chance to catch errors. So the scope of services needs to be appropriate.” In addition, because the contract price is fixed in very early stages of design development, the contractor may try to hold the architect responsible for increased costs from any downstream design changes.

The AIA and many architects recommend the architect-led version of design-build, but that also has inherent challenges. “The architect has to be bonded and is responsible for means, methods, and jobsite safety,” says Parsons. “If you are the prime, it all floats up to you.” A third option is to form a limited-liability corporation (LLC) or joint venture with the construction company. “You still have to be careful because construction risk still flows up to you. The LLC is popular because that deals with some of that risk issue,” says Parsons.

Of course, design-build is not always an option. A few states don’t allow the contracting method at all—Alabama, Iowa, Michigan, Rhode Island and Wyoming—though the other 45 allow some applications. “And in New York, there’s a turf battle between administrative agencies and the courts,” says Quatman. “The licensing board takes the position that it’s illegal, though the state courts have said it’s legal.”

• Construction Management
Construction managers oversee typically more complex projects, either as an advisor to the owner—while the architect and contractor retain conventional roles—or as an agent, which means the CM has the authority of the owner. In a third approach, known as CM-at-risk, the CM acts as constructor, coordinating the project and occasionally taking on the role of the general contractor. The CM assumes all liability and makes an early cost commitment, according to the AIA California Council’s Handbook on Project Delivery.

The continuous oversight of the CM approach appeals to owners that may lack the in-house resources to supervise their own projects. Many architects chafe at the CM’s powerful role, and rightly point out that any beneficial dialogue between designer and owner is mediated or even cut off. Other architects say they enjoy the CM’s tight control of cost, schedule, and constructability. A positive relationship between architect and CM can make up for the fact that the architect can’t communicate directly with the owner.

• Bridging
Bridging is best described as a combination of traditional bid delivery and design-build. In this approach, the owner hires the architect for preliminary design, and the same architect becomes the owner’s representative during the construction phase. The design documents prepared by the architect are used to choose a design-build firm, which completes the construction documents (CDs) and builds the project.

According to critics, crucial collaboration in the design phase is generally not a formal part of this delivery scheme, and conflicts may arise between the original architect and the design-builder. But as noted in Handbook on Project Delivery, there is ample attention paid to design issues—and a single point of responsibility during the CD and construction phases. Many highly innovative designs have been developed for the GSA and other clients using bridging contracts, such as Perkins & Will’s Los Angeles Federal Courthouse.

• Design assist
Another decidedly collaborative model, design-assist, involves early participation in programming and design by the contractor. The contractor might review site selection, program intent, project feasibility and cost and schedule targets. Other tasks typically include detailed budget studies, ongoing cost estimates and determinations of “value”—that is, whether the right dollars are being spent in the right places, given the project’s goals.

Design-assist is seen as a formal process for architect-contractor collaboration that can be highly detailed and controlled. For the renovation of the Utah State Capitol, for example, the state’s Capitol Preservation Board issued a set of “guidelines and imperatives” for contractors and then led a series of workshops to solicit highly detailed cost and constructability documents from participating teams. Generally, however, design-assist is more popular in the private sector, where there are no competitive bidding rules. For public projects, owners are often prohibited from hiring a GC until they are ready to bid; in some cases, however, public-sector owners may work with a CM for design-assist to get around the exclusion.

Design-assist has enjoyed positive reviews recently, especially on the heels of such successes as the San Francisco Federal Office Building, a highly innovative building delivered by design-assist. “There’s better cooperation between designer and contractor because they’re sitting side by side, and issues are resolved along the way,” says Quatman. “Design analysis, value engineering and constructability reviews are done as the design progresses.”

• Other methods
Some veteran owners have developed their own home-grown collaborative processes, many created in conjunction with architects or builders.

“When I became the client, we came up with ‘project definition’ to clearly characterize the project and know much more so we would be capable of delivering it on time and on budget,” says Utah’s Hart, “In design-bid-build and even design-build there is still this adversarial relationship; I kept asking myself is there not a better way to have a structure that’s more collaborative?”

Hart tried out project definition on two capitol projects, including a new 89,000-square-foot, $45 million building. “There were no change orders and no scope creep,” he says. But a few areas seemed ripe for improvement, so when Hart prepared for the larger capitol renovation project, he turned the selection process on its head. “You can get a lot from an architect, but we really wanted to have the contractor’s attention,” he recalls. “So we said, ‘What if we hire the contractor first, and they hire the architect?’”

Legal Considerations

Hart had a good idea—but one that won’t work for everyone. In many states, the architect has to be hired first. Other legal restrictions dictate how architects and contractors may work together—some offering useful protections to the architect. “In Illinois, for example, if the contractor hires the architect, that fact has to be disclosed to the owner in contract, and the contractor cannot replace the architect without the owner’s consent,” says Quatman. This helps avoid the situation in which an owner hires a team based on the choice of architect, only to see the contractor subsequently dump the original firm.

In fact, awareness of construction law is vital for architects interested in project collaboration. Inextricably linked with risk, legal considerations may largely decide how and when architects choose to collaborate with contractors.

For example, the growing area of law known as “economic loss” doctrine has prevented contractors from suing architects in design-bid-build delivery. “If the contractor’s loss is only economic, the contractor has to go through the owner to get to architect,” Quatman explains. Another issue is state licensing, which in some states is a requisite for holding the prime contract on a project. “Architects are licensed in every state, and contractors are licensed in about half of the states,” Quatman points out. So when the two affiliate formally, as in design-build, the architect may have to take the lead.

In fact, project delivery methods shape many legal concerns. For example, “In design-build, there are fewer lawsuits than in traditional procurement,” explains Quatman, who is also 2007 chairman of AIA’s Design-Build Committee. “If there’s a design problem, the A/E and GC do work it out. Designer and contractors see an indirect benefit because there are fewer claims.”

To complicate matters, two sets of strictures apply to cases where the architect and engineer form a legal partnership or LLC—licensing law and corporate law—and they don’t always dovetail nicely. Some states may restrict majority ownership of the entity to licensed professionals, or the LLC that seems advantageous for tax reasons may be restricted or forbidden under the licensing statutes.

The Right Outcomes

Beyond avoiding legal problems, how do architects measure whether their collaboration strategy has paid off? Innovation is one gauge, though it’s important to focus on a range of measures, say experts.

“Ultimately, we are interested in outcomes, which are traditionally quality, cost, and schedule,” says Fraga. “But that actually is not enough. I have delivered buildings on time and on budget and failed because I’ve delivered the wrong building! You need to have more.” For that reason, on any project Fraga adds three more for a complete yardstick of success:

• Customer satisfaction
  
• Supplier, contractor, and consultant satisfaction
  
• Employee satisfaction

Eventually an architect may want to work with the same team players again, says Fraga, so it matters to have satisfied builders and vendors. Employees should benefit from the process, and, of course, the client must feel good about the final product.

Thoughtfully outlining goals at the outset makes the final evaluation all the more meaningful. That’s another reason that Hart stands by “project definition” as applied at the Utah State Capitol. The results of the $8.5 million drum-and-dome portion, for example, included an innovative panelized terra-cotta cladding and an on-budget, on-schedule finish. “The contractors really complemented the architects, who were freed up to focus on design,” says Hart. “A wonderful synergy came out of that technical assistance.”

For contractors, the benefit of such tight alliances can accrue from the architect’s enhanced focus. “Rather than architects designing in a vacuum, and perhaps not considering the ramifications of means and methods—which can mean additional cost—this pulls them out in front so we can contain cost,” says Kevin L. Brown, project director with Jacobsen Hunt Joint Venture, Salt Lake City, which served as the general contractor for The Utah State Capitol project.

Another way to consider success is by what’s missing—things such as excessive change orders and lawsuits. “The teaming concept works,” Quatman summarizes. “The trust relationship is built, and for economic survival reasons architects and contractors choose to resolve issues rather than litigate disputes.”