AIA Update on Integrated Project Delivery Lean Construction Institute Design Forum January 8 2009 Markku Allison

1. We�ll be speaking today about changes that are moving rapidly through the industry, their causes and implications, and then look at how one owner is responding.We�ll be speaking today about changes that are moving rapidly through the industry, their causes and implications, and then look at how one owner is responding.

2. Next: a new public policy position statement was unanimously approved by the AIA Board in December 2007Next: a new public policy position statement was unanimously approved by the AIA Board in December 2007

3. (touch on a few samples of highlighted text)(touch on a few samples of highlighted text)

4. The essence of the new statement may be distilled down to these six points. Note especially the last bullet.The essence of the new statement may be distilled down to these six points. Note especially the last bullet.

5. �truly a sea change for the institute.�truly a sea change for the institute.

6. On November 5th of 2007, we launched the IPDGOn November 5th of 2007, we launched the IPDG

7. The Guide outlines the basic principlesThe Guide outlines the basic principles

8. A renaming of phases supports new outcomes, roles and responsibilities. Note early involvement of players.A renaming of phases supports new outcomes, roles and responsibilities. Note early involvement of players.

9. An important underlying ideaAn important underlying idea

10. As you can see, we�ve had significant market interest in The Guide since its November release--everyone is interested in IPD. Note that owners constitute the second largest group of those downloading the guide. As you can see, we�ve had significant market interest in The Guide since its November release--everyone is interested in IPD. Note that owners constitute the second largest group of those downloading the guide.

11. We are also working on agreementsWe are also working on agreements

12. Nearly 80% of respondents indicate they are aware of IPD; about half of respondents view themselves as knowledgeable or experienced.

13. Based on the definition, reduction of conflict is the IPD attribute of greatest value to project teams.

14. Based upon the definition, early involvement of key participants is the most important principle of IPD.

15. Of the potential barriers provided to respondents, lack of legal precedent and industry partner skill sets are the greatest barriers to pursuing IPD.

16. Lack of trust, lack of skills, lack of information about process and lack of appropriate technology are not significant barriers for most segments.

17. Lack of trust, lack of skills, lack of information about process and lack of appropriate technology are not significant barriers for most segments.

22. BIM appears to be influential in the success of IPD projects.

23. Sustainability goals are common in IPD projects, and appear to be influential in achieving sustainability goals.

25. Bottom line�these are all reasons why this transformation is good not just for us but for industry at large.Bottom line�these are all reasons why this transformation is good not just for us but for industry at large.

26. The third major thing you should know about is the 50to50.The third major thing you should know about is the 50to50.

27. (self explanatory)(self explanatory)

28. We are also working on agreementsWe are also working on agreements

29. IPD Agreements � Two Approaches There are two new forms of agreement; one transitional in nature and one far-reaching and provocative. Both will spur conversation in the industry and both will enable transformed ways of practice.There are two new forms of agreement; one transitional in nature and one far-reaching and provocative. Both will spur conversation in the industry and both will enable transformed ways of practice.

31. The red lines denote agreements. [#]1. SPE Agreement Agreement between the Owner, Architect, Construction Managerfor the operation of the SPE [#]2. Owner/SPE Agreement SPE agrees to plan and construct the Project; Owner agrees to fund the SPE [#] 3. Member Architect/SPE Agreement Architect agrees to provide professional services to the SPE in exchange for direct cost compensation plus potential incentiveand goal achievement compensation Construction Manager/SPE Agreement Construction Manager agrees to provide construction management services to the SPE in exchange for direct cost compensation plus potential incentive and goal achievement compensation [#]4. Non-Member/SPE Agreement The SPE enters into agreements with contractors and consultantsfor the construction of the Project based upon on lump sum or GMP basis The red lines denote agreements. [#]1. SPE Agreement Agreement between the Owner, Architect, Construction Managerfor the operation of the SPE [#]2. Owner/SPE Agreement SPE agrees to plan and construct the Project; Owner agrees to fund the SPE [#] 3. Member Architect/SPE Agreement Architect agrees to provide professional services to the SPE in exchange for direct cost compensation plus potential incentiveand goal achievement compensation Construction Manager/SPE Agreement Construction Manager agrees to provide construction management services to the SPE in exchange for direct cost compensation plus potential incentive and goal achievement compensation [#]4. Non-Member/SPE Agreement The SPE enters into agreements with contractors and consultantsfor the construction of the Project based upon on lump sum or GMP basis

32. The following slides are going to review the basic contract structure of SPE. Starting with the SPE Agreement � C195 First set of animation shows the forming of the SPE. While only O, A and CM are shown, other project participants can be Members of the Company The bullets list the major elements of the SPE AgreementThe following slides are going to review the basic contract structure of SPE. Starting with the SPE Agreement � C195 First set of animation shows the forming of the SPE. While only O, A and CM are shown, other project participants can be Members of the Company The bullets list the major elements of the SPE Agreement

33. The Owner Member enters into an agreement with the SPE using AIA Document C197. Owner limits the Non-Owner Member�s liability to available insurance, except for willful misconduct Assign SPE all claims between Owner and Non-Member Assign SPE all claims against Non-owner Members Indemnification of Owner by SPE for damages not covered by insurance, except for willful misconduct The Owner Member enters into an agreement with the SPE using AIA Document C197. Owner limits the Non-Owner Member�s liability to available insurance, except for willful misconduct Assign SPE all claims between Owner and Non-Member Assign SPE all claims against Non-owner Members Indemnification of Owner by SPE for damages not covered by insurance, except for willful misconduct

34. The Members also enter into agreements with the SPE. The Non-Owner Members (in this graphic the A and CM) enter into services agreements with the SPE. All Non-Owner Members use the same document � AIA Document C197. Limitation of Member�s liability to available insurance, except for willful misconduct Indemnification by SPE for damages not covered by insurance, except for willful misconduct Assign SPE all claims between Member and Non-Member Assign SPE all claims against other MembersThe Members also enter into agreements with the SPE. The Non-Owner Members (in this graphic the A and CM) enter into services agreements with the SPE. All Non-Owner Members use the same document � AIA Document C197. Limitation of Member�s liability to available insurance, except for willful misconduct Indemnification by SPE for damages not covered by insurance, except for willful misconduct Assign SPE all claims between Member and Non-Member Assign SPE all claims against other Members

35. The SPE contracts with the trade contractors, consultants and other non-members on a stipulated sum or GMP basis. With some revision other agreements within the AIA family of documents can be used for these non-member agreements. The SPE reference AIA Document A102 Owner Contractor Agreement with a GMP as one appropriate document. Revision that may be appropriate include defing any role the non=member may play prior to establishing the Target Cost, any participation in the goal or incentive savings, and alignment of the dispute resolution process.The SPE contracts with the trade contractors, consultants and other non-members on a stipulated sum or GMP basis. With some revision other agreements within the AIA family of documents can be used for these non-member agreements. The SPE reference AIA Document A102 Owner Contractor Agreement with a GMP as one appropriate document. Revision that may be appropriate include defing any role the non=member may play prior to establishing the Target Cost, any participation in the goal or incentive savings, and alignment of the dispute resolution process.

36. And also the E202 BIM Protocol Exhibit--a great resource that allows project participants to look at each building element (broken down to CSI�s UniFormat Level III) and identify who exactly will be responsible for development of that element to a specifically defined level of detail at specifically identified points during the design and construction process (usually project phase transitions). And also the E202 BIM Protocol Exhibit--a great resource that allows project participants to look at each building element (broken down to CSI�s UniFormat Level III) and identify who exactly will be responsible for development of that element to a specifically defined level of detail at specifically identified points during the design and construction process (usually project phase transitions).

37. This is the heart of the document�the modifiable table. An LOD is assigned for each Model Element at each Phase. The LOD�s provided are defaults, but are fully editable. The Parties also insert, for each Model Element for each phase, the MEA responsible for the development of the Model Element. Through this table, the parties identify how the Model Elements will be developed over the course of the project and who will be responsible for it. Document is available in three forms. One with default LOD values and phase names based on an IPD project, one with default LOD values and phase names based on a design bid build project, and one that has no default LODs or phase names.This is the heart of the document�the modifiable table. An LOD is assigned for each Model Element at each Phase. The LOD�s provided are defaults, but are fully editable. The Parties also insert, for each Model Element for each phase, the MEA responsible for the development of the Model Element. Through this table, the parties identify how the Model Elements will be developed over the course of the project and who will be responsible for it. Document is available in three forms. One with default LOD values and phase names based on an IPD project, one with default LOD values and phase names based on a design bid build project, and one that has no default LODs or phase names.

40. Article 3 defines 5 LODs � 100, 200, 300, 400 and 500. For each LOD, E202 defines the content required to satisfy that level and the appropriate uses. For example, level 100 LODs content should consist of Overall building massing indicative of area, height, volume, location, and orientation may be modeled in three dimensions or represented by other data. E202 then sets forth the authorized uses for a Model developed to LOD 100. Lists Analysis, Cost Estimating, Scheduling and other as the parties may identify. Level 400 is similar to shop drawings and Level 500 would be similar to as builts.Article 3 defines 5 LODs � 100, 200, 300, 400 and 500. For each LOD, E202 defines the content required to satisfy that level and the appropriate uses. For example, level 100 LODs content should consist of Overall building massing indicative of area, height, volume, location, and orientation may be modeled in three dimensions or represented by other data. E202 then sets forth the authorized uses for a Model developed to LOD 100. Lists Analysis, Cost Estimating, Scheduling and other as the parties may identify. Level 400 is similar to shop drawings and Level 500 would be similar to as builts.

41. E202 is divided into four articles: the first article consists of general legal duties and definitions. The 2nd Article defines protocol items such as model management and archiving. The Third and fourth article are the heart of the document and are addressed in the following slides. **note the second section which is the flow down clause. [Click the mouse to show red box around it.] This section requires the parties to incorporate the exhibit into any downstream agreement on the Project. E202 is divided into four articles: the first article consists of general legal duties and definitions. The 2nd Article defines protocol items such as model management and archiving. The Third and fourth article are the heart of the document and are addressed in the following slides. **note the second section which is the flow down clause. [Click the mouse to show red box around it.] This section requires the parties to incorporate the exhibit into any downstream agreement on the Project.

45. One driver is better understandings and documentation of waste. The newest data important to know about is the MHC SmartMarket Report�you can get this on our website now. In addition to valuable information about the costs of the lack of interoperability, there is great data about BIM adoption.One driver is better understandings and documentation of waste. The newest data important to know about is the MHC SmartMarket Report�you can get this on our website now. In addition to valuable information about the costs of the lack of interoperability, there is great data about BIM adoption.

46. The first and most important IPDiG effort for the year is a guide to compensation models for teams, offering new paradigms for a transformed industry. This guide should be available for download in December 2008. The first and most important IPDiG effort for the year is a guide to compensation models for teams, offering new paradigms for a transformed industry. This guide should be available for download in December 2008.

47. Check out these resources and more at� The end.Check out these resources and more at� The end.