Selection of a delivery route is a key decision in complex construction programmes
It is well understood that the preconstruction phase of a project is where the benefits of controlling costs through design and team collaboration are the greatest. Early Contractor Involvement (ECI) effectively taps into their expertise especially in the areas of buildability, constructability, construction scheduling and planning, value management or value engineering and the latest construction technologies or methods It’s here that constructability is determined, financial risks are mitigated, and informed decisions have the highest impact on the development’s overall profitability.
Studies have shown that savings of around 10% in construction phase time and 7% in cost are achievable through the use of ECI (Source Wikepedia)
Figure below demonstrates the stages where cost can be influenced. (Source Pressman 2007)
Cynics say that Early Contractor Involvement is too costy, that it takes the edge off competitive pricing
The answer to the cynics is that if procurement and contractual systems are set up properly, then Early Contractor Involvement gives far better cost and programme control. It provides a way to extract the Contractor’s ideas about the scope of the project and its supply chain, and there is plenty of time before the Contractor is authorised to start work on site.
So, what are the features of properly structured Early Contractor Involvement?
Contractor selection on the basis of their ability to deliver value (Collaboration, Innovation, Time and Cost)
Contractor appointment on a conditional basis ECI Stage 1 until designs and a Scheme Target Cost is agreed. Allow time for value engineering and risk management exercises that allow the Contractor and its prospective subcontractors to help iron out inappropriate costs or unaffordable / unbuildable designs.
Binding programmes for deliverables for all stakeholders involved throughout the preconstruction period. The agreed structure should avoid the risk of misunderstandings through single integrated programmes.
Avoid separating the Stage 1 and the Stage 2 appointment so as to calm the fear of the Contractors that their best ideas will be grabbed by and put out to tender.
Most importantly, mitigate the opportunities for brinkmanship and last-minute negotiation that arise if agreed preconstruction phase processes are not rigorously followed.
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