Integrated Project Management Approach

The IPMA (Integrated Project Management Approach) method is a design process method that was started in 1984. The integrated project delivery approach is a project delivery method that emphasizes collaboration, accountability, and control, aiming to reduce risks.

The Back Story to IPMA

The kick off

In June 1984, the construction of the Le Meridien Gardens Hotel (later changed to the Four Seasons Hotel in Beverly Hills, Los Angeles underwent three consecutive project management consultant. Anthony Mason of AMAPM (Anthony Mason Associates Project Management) was engaged as the fourth project management consultant. Upon being hired, it was evident that the project faced many challenges. Tony did not initiate the the traditional design–bid–build (D/B/B) approach which partly further fomented disagreements among the project team. At the time, two very qualified General Contractor had left the project in the pre-construction phase, as they could not determine how they would be allowed to effectively contribute and add value, as the risk of failure was too high.

A that point, the Project was in design, and the Project Consultant Team were in general  disagreeing with each other on the project process and priorities. In addition, the Owners were inexperienced in developing commercial projects of this type and scale which caused the Consultant Team to be critical of them due to their inexperience and  their unorthodox approaches in addressing project issues.

The Hotel Project city entitlement, permits and approvals had also stalled due to the City Planning and Zoning issues. Simultaneously a new GC from Arizona who had not previously worked in Los Angeles joined the team, and was therefore an unknown quantity. The “word on the street” was that the Project was troubled!

The context

The Project Manager, only by holding delegated Client authority, needed to provide clear leadership, stabilize the project, and unify the dysfunctional team, at the time. A reality check of construction costs was necessary to ensure financial feasibility. To meet the 23-month schedule for the hotel's opening, the team required increased collaboration, achievable through revised contracts that support a cooperative and transparent work environment . The traditional Design/Bid/Build approach was insufficient for the needed collaborative process.

If the Team accepted this Alternative Project Delivery Approach, with the GC providing a  reliable cost projected to as an “Initial Cost Guarantee” it would be acceptable to the Client for  the GC to provide Pre-Construction Services. This process required for the Design Team to  responsibly complete the design through CD’s, within the Price Guarantee by designing what  was “normal and necessary” for a completion construction solution based on what could  reasonably be understood based on “Intent of Design”). This Alternative Process would also  require that at 100% CD, the GC was to competitively bid the Design with Pre-Selected Subcontractors (who were also required to bid based on Intent of Design), to confirm that the  “final” GMP was equal or less than the “initial” GMP for the same Scope, before Construction  could commence.

Adopting Approach of the (IPMA) Process

After a lengthy discussion on alternate options, all parties accepted any recommended Alternative “Intent of Design” “Initial” IGMP/ “Final” GMP Project Delivery Method as the preferred Alternative. The GC was required to executed a Contract based on the agreed process  procedure and the “initial” GMP prior to engaging in the Pre-Construction Process while at the  end of the Pre-Construction confirming the “final” GMP via competitive sub-bidding at 100%  CD’s.

This Alternative Approach required the GC (who was also Contractually not allowed to perform  sub trade work) to transition into the role as a “CM at risk” as opposed to a “GC”. In the design  process the “CM” was able to perform Pre-Construction Services with the responsibility to  “check/monitor” the cost of the design against the projected “initial” CSI Line Item GMP as the  design developed towards completion, in order to control the budget/cost of the Design. This  provided for a controlled a transparent Team process which highlighted any for scope creep which when detected would be resolved by the Team who to collectively address/resolve within  the projected budget and schedule before CD’s were completed.

Collaborative Pre-Construction Approach for Budget Control and Final GMP Confirmation

To control the design budget during the pre-construction period, the "CM" implemented constructability reviews, Pricing Alternative Design Options, and Value Engineering as part of Pre-Construction services. The collaborative A/E/"CM" Team used these tools to maintain the budget and schedule, addressing any design scope increases or scope creep collectively. In parallel, the Team prepared a coordinated, biddable, and build-able set of CD's for competitive subcontractor bidding by the "CM" at 100% CD's to confirm the "final" GMP.

Understanding that approximately 90% of construction costs come from sub-consultants (with the "CM" Fee, GC’s, GR’s Insurance, etc. making up about 10%), the Team recognized the importance of collaboration and cooperation. At the completion of subcontractor bidding through this alternate process, the Owner, Project Manager/Consultant Team, and "CM" jointly selected the qualified low-bid subcontractor per trade. This selection was based on a transparent open book review of the original Sub bid and the Trade Line item bid comparison matrix per trade. The Team's decision on the qualified low-bid subcontractor per trade, along with the summarization of the selected Sub-Trade Bid and the "CM" Fee, GC’s, and GR’s, confirmed the "Final" GMP. Subcontractors were also asked to submit VE with their trade bid, which, if acceptable, could help reduce the "final" GMP if needed.

Effective Alternative Project Delivery Approach for Budget Control and How Team Unification is Possible

This alternative Project Delivery Approach allowed the “CM” to contribute to the budget control of the design and supplement the Design Team/design process through their construction experience and market cost knowledge to achieve a controlled and smooth transition from Preconstruction into Construction. This also allowed the Team through the “CM” in the pre construction phase to place long lead orders for material/equipment to support the project  construction schedule.

It was a success in itself that the Project Team collectively agree and commit to this approach,  (considering to the original project circumstances) although in reality it presented the only valid  alternative to unify the Team through a common goal and proceed through collaboration to  countered the Institutionalized Risk, Siloed approach, and other disadvantages represented by the Traditional Design / Bid / Build Process.

Change of this type to the Project Process is only  possible when all parties perceive it as a risk reducing option and an improvement. They also  need to trust that the Change to the Alternative Project Delivery Method would be equitably, consistently and transparently applied throughout the project process by the Project Manager who had the support of the Client.

Initial Conclusion, and Adaptability to Valid Scope Changes

The Four Seasons Hotel Project required building new relationships and earning trust within a temporary organization to achieve team objectives. Despite inevitable challenges, the team addressed issues rationally and equitably with strong client support. Maintaining working relationships was a priority throughout the project.

Six months into construction, the client changed the hotel operator to Four Seasons, leading to valid scope changes and upgrades. The GC Contract, based on the "Intent of Design," allowed for these changes by requiring subcontractors to provide bid unit rates. This approach enabled the Consultant/CM/Subcontractor Team to transparently and equitably manage cost changes in an open book manner, ensuring a controlled process.

Any design change costs were resolved through teamwork, prioritizing the schedule over maximizing cost opportunities from Change Orders. The CM's cooperation was crucial to the project's success, demonstrating the effectiveness of this alternative process.

Conclusion

Although in 1984/1987 in LA, this was a unique and ambitious change from the traditional D/B/B project delivery process, and it did involve a degree of Client / Team risk by accepting the Change in approach to this Alternatives Delivery Method, it was seen by the Client and the Architect,  Engineers and Construction Team as a necessity and a risk-reducing and valid Alternative  Project Delivery process which was needed to turn the project around and provide an “in flight”  mechanism to deal rationally with the project challenges through a preferred alternative to the  traditional ways of working.

The “Intent of Design” “final” GMP Contract was executed on 06/27/85 (after demolition and  grading being competitively bid to allow these Trades commencing work based on a Foundation Only Permit), which was a necessity to maintain the aggressive 23-month schedule.

Since the Four Seasons Projects successful completion, over the intervening 38 years, AMA  Project Management has implemented the now more appropriately named “Intent of Design” IGMP/ GMP Process, on over 120 projects of differing Types and Scales while the Method has  been continuously improved through the experiences each gained on each project.

What is Project Management

Project Management is crucial across various project disciplines, especially in today's dynamic and competitive environment. Effective project delivery benefits from a collaborative, team-based approach. While Integrated Project Delivery (IPD) and LEAN Construction methods have shown potential, they have not become the industry's preferred methods. A scalable, adaptable, and collaborative approach is needed for everyday projects.

What is Integrated Project Management Approach (IPMA)?

To address these challenges, a method called "Intent of Design" (IGMP) was implemented. The "IGMP/GMP method" was later identified as the IPMA method, taught at the Harvard University GSD since 2011. This method involved hiring the general contractor (GC) earlier in the design process and using schematic design drawings, with the collaboration of the architects and engineers who provide narrative for work not in the bid document yet. The GC would then provide an initial guaranteed maximum price (IGMP) to identify the construction cost by involving competitive subcontractor bidding and by ensuring a comprehensive bid, with a guaranteed cap.

IPMA is being used on over 120 projects for the last 40 years, in Los Angeles and abroad, and has been documented by Harvard University. The method is currently taught at the Harvard Graduate School of Design. Multiple case studies have been drafted on various projects utilizing this project delivery method.

In 2009 AMA were fortunate for Harvard GSD to document and Publish the Alternative Project  Delivery Process as a Case Study of the Loyola Marymount University William H. Hanon Library  Project which utilized AMA Project Management Intent of Design IGMP/GMP Method (which incidentally finished $ 2 million under budget and on schedule). This afforded AMA the  opportunity (with Dr. Andreas Georgoulias and Samuel Kuo) to design and teach what Harvard  has renamed as the Integrated Project Management Approach to Project Delivery (IPMA).

This  Harvard GSD Executive Program has been offered by Harvard Graduate School of Design as an  Executive Program since 2010 and is now, in 2024, in its 15^th year.