This document discusses different approaches to design-build procurement, including qualifications-based selection, price-based selection, and best value selection. It outlines the advantages and disadvantages of each approach. Qualifications-based selection focuses on contractor qualifications, price-based selection focuses on price alone, and best value selection evaluates both qualifications and price. The document also discusses progressive design-build, where the design-builder is selected based on qualifications and works collaboratively with the owner to advance the design.
2. Agenda
• Procurement Goals
• Evaluation Options
• Types of Procurement
• Considerations for Selection of Procurement
Type
3. Procurement Goals
• Attract the best competition from the
qualified DB teams
• Obtain an acceptable market price for DB
services
• Obtain acceptable contract terms to meet
Owner’s project objectives with acceptable
risk allocation
6. Design-Build Procurement Approaches
Design-Builder is selected
based on Qualifications
alone.
RFQ
A price for the project is developed
at a specified level of design and
could be GMP or Lump Sum
Qualifications Based Selection
7. Design-Build Procurement Approaches
Design-Builder is selected
based on price alone
(i.e. lowest responsive price)
RFP
(requires some level of design)
Qualifications Based Selection
Price Based Selection
8. Design-Build Procurement Approaches
Design-Builder is
selected based on a
combination of
qualifications and
price
RFPor RFQ&RFP
Qualifications Based Selection
Price Based Selection
Best Value Selection
9. Qualifications Based Selection
ADVANTAGES
• Reduces procurement time and cost
• Most qualified Design-Builder is selected
• High degree of Owner control
• Owner defines/negotiates scope, quality, price and
schedule
Project
Definition
Predesign
Final
Design
Construction Startup
10. Qualifications Based Selection
DISADVANTAGES
• May not be legally permissible
• Is counter to “public low bid” psyche
• Could be “tough sell”
• May need to engage a procurement advisor
Project
Definition
Predesign
Final
Design
Construction Startup
11. Qualifications Based Selection
QUALITATIVE CONSIDERATIONS
* Qualifications * Experience
* Technical Approach * Management Approach
* Risk Allocation * Key Personnel
* Team Organization * Schedule Control
* QA/QC Approach * Insurance / Bonding
Project
Definition
Predesign
Final
Design
Construction Startup
12. Price Based Selection
ADVANTAGES
• Price certainty at time of proposal submission
• Detailed technical information provided
Project
Definition
Predesign
Final
Design
Construction Startup
13. Price Based Selection
DISADVANTAGES
• Large time investment in procurement
• Greater effort to review proposals
• Owner input only during procurement development
• Life-cycle cost considerations limited
Project
Definition
Predesign
Final
Design
Construction Startup
15. Performance vs. Prescriptive
Predesign Final Design
Performance Based Prescriptive Based
INNOVATION CONTROL
Performance Based Prescriptive Based
• Maximum potential for cost
savings through innovation
• Maximum transfer of
design-related performance
risk
• Relatively low costs to
prepare RFP / Proposal
• Substantial control over
project design and O&M
costs
• Proposal selection can
emphasize project design
build costs
• High level of project
definition at time contract is
signed
ADVANTAGES
16. Performance vs. Prescriptive
Predesign Final Design
Performance Based Prescriptive Based
INNOVATION CONTROL
Performance Based Prescriptive Based
• May result in higher O&M
costs
• Proposal evaluation and
selection is more complex
• Potential for decreased
participation due to higher
preparation costs
• Limited Owner input into
design after proposal is
accepted
• Procurement duration is
longer
• RFP preparation is more
costly due to high level of
design
• Design risk not clearly
assumed by the Design-
Builder
DISADVANTAGES
17. Best Value Selection
CostQualifications
ADVANTAGES
• Price certainty at time of proposal submission (maybe)
• Detailed technical/qualifications information provided
• Depending upon cost component – collaboration can still exist
Best Value Selection
20. Progressive Design-Build
In a progressive design-build
procurement, the design-builder
is selected primarily based on
qualifications before substantial
design is completed. Together,
the owner and the design-build
team advance the design,
incorporating the details desired
by the owner and providing the
owner with cost input regarding
options the owner is considering.
This open-book approach
enables the owner to make well-
informed decisions on the
overall quality of the project.
(Chapter 3, page 25)
21. Progressive Design-Build
Design/Builder
Design Development and ConstructionDesign
Definition
Owner
PM/OA
100%
Guaranteed maximum price
established at the right time:
Risk and contingency reduced,
schedule needs met
Construction estimating can
start very early in design,
allowing comparison of specific
technical solutions
First fully detailed estimate
can be used to establish a
scope baseline. Estimating
process is “open book”
“Progressive” estimates keep
owners informed and support-
informed scope adjustment
decisions
Owners can use third-parties to
verify cost . . .
. . . and go to the hard-bid market
if needed (the “off-ramp”)
22. Progressive Design-Build
Design/Builder
Design Development and ConstructionDesign
Definition
Owner
PM/OA
100%
• Investment in projects, not procurements
• Offers owners maximum flexibility/opportunity to collaborate on
design/permitting
• Minimizes overall schedule
• Owners have an “off-ramp” in case of permitting issues or if GMP
can’t be negotiated
• Very successful evolving model