Today's SurgiCenter - Bottom Line

Surgical Facility Construction Looks Back for the Future

By Jack Coale

We know that the earliest surgeries performed in Greece, South America and elsewhere were done in ambulatory facilities built by master builders who designed and constructed them. The concept of illness treatment by surgical invasion preceded the notion of the hospital by hundreds of years. It also appeared centuries ahead of the idea that it would be desirable to use separate sources for the art of architecture, the science of engineering, and the craft of construction.

Without regard for the success master builders achieved with structures like the pyramids, the Parthenon and the Pentagon (completed in just 16 months), the 20th century saw the rise and dominance of the design-bid-build delivery method.

This approach has generated some planning process advantages, such as providing more time for entities that have difficulty reaching effective, timely decisions. It also offers the comfort of more complete specifications control by an independent architect; however, the planning latitude and controls it offers are delivered at a cost of much slower concept-to-completion accomplishment and higher project costs, with no measurable impact on quality. It also tends to replace client-centered performance solutions with prescriptive specifications crafted to serve design firms’ needs. Unfortunately, these prescriptions are routinely generated without adequate consultation with construction experts.

In a recent survey of key decision makers in healthcare design and construction, with annual spending levels ranging from $125 million to $600 million, respondents who used design-bid-build delivery reported very low satisfaction with schedule and budget performance results. The Contractor’s Management Journal reported in 2003 that only 29 percent of respondents are “very satisfied with project performance to schedule,” and only 14 percent are “very satisfied with project performance to budget.”

The Design-Bid-Build concept incorporates a linear process of design — stop and bid — then re-start and build, with a different entity under a separate contract. (See Table 1) Design-build, the process used through the centuries by master builders, provides simultaneous project action steps from a team working under a single contract that is responsible for the finished product. (See Table 2) As the 20th century progressed, designbuild delivery began to dominate non-residential construction in Japan, Europe and the United Kingdom. Its ability to produce a firm cost earlier, a finished facility faster, and lower costs with equal or better quality appealed to international markets more than the specifications control advantage. It also virtually eliminates end-of- project conflicts that embroil clients in costly claims disputes, arbitration or litigation on 30 percent to 50 percent of healthcare projects.

Construction industry experts predict that design-build project delivery will surpass the volume of design-bid-build on non-residential construction in the United States in 2005, and its popularity in healthcare facility construction is growing rapidly. Capital constraints faced by healthcare providers across the nation are placing an ever-higher premium on early cost certainty and project cost savings, plus earlier market entry for new services that can capture market share and generate return on revenue faster.

The New Challenge: Choosing Your Team’s Characteristics

In response to the growing acceptance for design-build delivery in healthcare facilities, some provider/clients are forming “brand new” design-build teams with design architects and builders they know and trust. Guidelines for uniting multiple firms under a single contract, with one point of ultimate responsibility, are widely available. Known and trusted design firms are increasingly willing to participate with construction firms to market design-build capabilities to prospective clients.

These firms routinely declare that architects, engineers and constructors who have worked together before can mold successful design-build teams and produce all the advantages this delivery method enables. If you choose to utilize design-build, your project goals must drive the choice between one of these teams of firms vs. an integrated designbuild firm.

Integrated design-build firms offer architecture, engineering, construction, some self-performed craft services, and in many cases, even product fulfillment from a single entity. These companies offer design-production teams who work together repeatedly.

Clients face the choice of selecting known entities that are eager to ride on the rolling design-build bandwagon vs. integrated regional or national firms with years of deep experience in this particular delivery approach. Graphically, the choice looks somewhat like Table 3.

A look at the decision factors for your new facility choice prompts a hard look at the questions that address these key issues: So what? What does it mean to me, as owner/client?

Q: What is the essential difference between a new team of firms, comprised of old friends vs. an integrated design-build firm?

A: When renowned surgeons like Dr. Ben Carson of Johns Hopkins or Dr. Roger Mee of the Cleveland Clinic face a case with life-ordeath implications, their attitude is never, “any capable team scrubbing in will do.” They insist on their team, whose nurses, techs and colleagues know their moves and anticipate their thoughts. If project execution precision is very important to you, an integrated design-build firm can more likely deliver the cost, quality and schedule certainty you need. If friendships and old donor relations give you more comfort, a team of your making may serve your needs best.

Q: Is certainty of outcome the key factor in this choice?

A: Definitely. The average healthcare construction project goes over schedule and over budget. There is often plenty of opportunity to spread blame, and always ample excuses that will be easily accepted in many cultures. If yours is one of these, you have more freedom of choice. If you work in a less-forgiving organization or march to the beat of a personal drum that demands high performance against stated objectives, you will definitely be served better by an integrated design-build firm.

Q: And what is this outcome objective that high-performance outfits are shooting for?

A: In the landmark Construction Industry Institute/Penn State University study of 351 projects, design-build delivery was demonstrated to cut project cost by 6 percent and concept-to-completion schedule by 33 percent, while generating the evaluation that “design-build exceeded quality expectations at all levels.” Integrated design-build firms can surpass these “generic design-build” results because team members are not across town or across the country from each other. They are next door or down the hall. Performance strength is tied to access and communications frequency in virtually any setting or activity sphere.

Q: What about the major issue of understanding my project performance goals?

A: It depends on your strengths and the roles you wish to play. If you are willing to play referee and are good at sorting out the filters that different agendas of different firms will exert on project discussions...you have near equal choice between approaches. If you know this “people antenna” and sorting challenge is not your strength nor your passion, integrated design-build will make the task far easier for you. When all parties are at your table and at their common table consistently hearing your needs and desires together, interpreting with one common agenda, you can expect to see a better understanding of your critical needs and goals emerge. The teaming option you choose should also provide you with all the information you need to make the best value decisions.

Q: What are my choices as I seek integrated design-build firms to consider?

A: Getting better all the time. By staff addition and acquisition a number of firms have become integrated design-builders. Before you leap, check to make certain they have accumulated enough experience to deliver the superior capabilities you’re seeking. It takes some time for architects and constructors to really learn to see the world with a common and constructive view that will work best for you. Integrated design-build is not a new buzzword. It is a project-delivery culture that has been carefully developed and nurtured by industry leaders for decades. It has moved beyond the limitations of architect/contract or teamed delivery to overcome the conflicts that dual strategies, dual agendas and dual profit margins can bring to your project.

Jack Coale is director of project development for The Haskell Company in Jacksonville, Fla.