We are witness to an upsurge of large-scale innovative projects in the UAE, compared to the early part of the last decade. Having laid the foundation of the primary infrastructure in the last 20 years to a great degree of success, the Emirate is now training its sights on innovation as a layer over the already-laid infrastructure.

Investments, in the order of billions of US dollars, are being directed to the commitment towards innovation. This rise of large-scale innovative projects has directed the focus of construction companies to efficiently execute and deliver these products of innovation. In this regard, the perpetual debate between Design-Build Model (DB Model) and Design-Bid-Build model (DBB model) gains more steam than ever, as the quality, execution time, budget and profits are dependent on which model is adopted for a project.

Sahul Hameed

Under the traditional DBB model, the client hires a designer/consultant to complete detailed construction drawings and specifications for a project. Only after the design is complete does the client take bids and hire a contractor to produce the design.

A DB model significantly simplifies project delivery by having a single entity responsible for both design and construction (i.e. the contractor) and, thus, a single point of responsibility for the Owner.

A key part of any construction project, whether innovative or not, is ‘change’. Change in requirements, change n scope, change in design, change in equipment, material, make and so forth. These inevitable changes result in variation and, subsequently, project deviation. Although project contracts allocate contingency costs to account for potential changes, often the costs associated with these changes rise above the allocation.

Rising contingency cost is a more regular occurrence with innovative projects, where there are unforeseen delays in design, execution and delivery due to the nature of innovation. This places a strong emphasis on the type of execution model – DBB vs DB – that needs to be adopted for a project. The DB model, generally allowing for faster execution and delivery of projects through not having to wait for decisions to be made by another entity in the model, is ideal for a client looking for a valueengineered project, keeping innovation intact.

A major argument supporting the DBB model is the quality assurance and checks that come along with having another entity – consultants or designers – involved in the design process. It is a natural assumption that the consultants keep a tight grip on the quality of the design and execution of the project. Proponents of the DBB model will also state that in the DB model, the quality and timeliness of the project delivery will be solely dependent on the client’s technical expertise of the operations in the construction industry. However, in the current landscape of the construction industry, most clients possess their own well-rounded engineering team, which acts as their own Project Management Consultancy.

The client’s engineering team implements design checks and oversees every stage of the execution phase, ensuring the quality aspect of the project is not overlooked at any stage. Most clients also have their own in-house Facilities Management unit, which overlooks the Operations and Maintenance, after the delivery of the project. In such scenarii, adding another entity in the process chain duplicates the work and efforts of the client’s engineering team, resulting in process delays and overhead costs. The client eventually bears the cost of these duplicated efforts, which in all actuality, can be avoided.

Retrofit projects constitute another growing sub-sector of today’s construction market, resulting due to innovation in the system design sector. As part of Dubai’s energy-efficiency programme, the emirate has set a target to retrofit 30,000 buildings with an investment of USD 8 billion by 2030. Retrofit projects require adequate execution from inception to completion for them to be considered a success for all parties involved.

In addition, retrofit projects require a swift turnaround time with a high degree of efficiency in daily operations by a competent contractor. A third entity in the client-contractor relation, which generally slows the wheels during the delivery of projects with hard deadlines. The DB model is well suited to grease the wheels of operations to tackle the challenges that retrofit projects bring along with them. In the construction industry, a key player in determining the budget – and, subsequently, the profit margins for each party involved – of a project is the Supplier of major equipment and systems in compliance with the project requirement.

Customisation of products results in varying costs as per the requirement of the projects. Therefore, standard pricing techniques that are utilised by suppliers for their off-the-shelf products will not be optimal in such cases. Technical variations, including design changes, in these customised products will result in additional costs to the client.

In a DBB model, with a third entity entrusted with the design and quality control decisions, approval orders to subsequently purchase these products result in delays. In a DB model, with the contractor entrusted with the design decisions, the communication and approvals with the client will be direct, swift and efficient, which provides leverage to obtain competitive pricing of these products.

It should be noted that not every contractor will be able to bring themselves to the DB model table for discussion. Only competent contractors, with an exemplary performance history, well-rounded team of engineering professionals and in-house setups in the supplier, manufacturing and vendor industries, will be able to qualify for contracts adopting the DB model. At the end of the day, a DB model delivery requires a high level of trust and expertise from all parties to streamline decision-making, accelerated progress and a heightened development experience.

On the other hand, if a client is confident that a contracted designer’s documents provide a comprehensive scope within the project budget, a DBB model delivery could be advantageous. However, any unexpected costs or design deficiencies during bidding can, and will, hinder a project’s performance under a DBB model delivery. There is no doubt that each model delivery method should be evaluated for a project. The eventual decision to utilise the DB or DBB model should include these considerations based on the needs of a project.

The writer may be contacted at sahul@bindasmal.com