While IPD is an improvement over conventional delivery methods, many clients nevertheless avoid sharing risk in IPD contracts, thereby motivating participants to resort to traditional practices.
As for those who do implement risk-sharing arrangements, one must ask why, as a client, you would pay more by setting up contingencies for contractors and architects, and/or take on greater risk, simply to encourage your service providers to work in a more collaborative manner? Toyota would never have been able to eliminate 80% of the time required to prototype a car if the design and fabrication processes relied on a contract between two firms.
Some owners and practitioners have chosen to innovate better business models instead of relying on such contractual arrangements. A few architects and contractors have formed joint ventures to pursue specific building types over prolonged periods of time, while some owners have created alliances between contractors and architects to deliver many projects over extended periods.
Some industry firms have integrated the AEC disciplines internally, leveraging a much larger pool of resources to significantly improve the delivery process. This business model innovation—an Integrated Enterprise (IE)—is more effective than contractual innovations like IPD because the parties enter each project with a high level of trust between participants that can only be earned through working together long term.
In addition, Integrated Enterprises can afford to heavily invest in training, technology, and innovative processes to better integrate, knowing they can amortize the cost over many projects with the same teams or firms working together. Teams on IPD projects cannot afford this level of investment since the costs are too great to be absorbed by a single project and one cannot predict if the parties will ever work together again.
If the AEC industry is really serious about implementing significant improvement in the delivery process, participants must make tough decisions to integrate internally in some fashion and commit to some form of Integrated Enterprise for the long-term.
Remember that Apple committed to its notion of integration 35 years ago and has been learning from its failures and successes ever since. This is a marathon, not a sprint, but you have to start engaging!
Henry C. (Peter) Beck III is managing director of The Beck Group, Dallas, Texas