A Guide to Early Contract Involvement

Sep 22, 2021 8:41:09 AM   /   Lily Simmons

Every project is different. Sometimes we get involved at a very early stage. Sometimes we're called in at the last minute. Yet whilst every project is different, we do believe there are some consistent advantages to be derived from specific approaches. In particular, Early Contractor Involvement. (ECI)

What us Early Contractor Involvement?

The Alliance Associate of Australasia defines ECI as a 'process where the designer and constructor work together in contractual relationship with the client, first to scope and price a project, and then to design and construct a project.' In other words, it's a collaborative effort between the designer, contractor and client, with defined overlap. This differs from the traditional design-bid-build approach where there is no (or very limited) overlap between design and construction, and where they are treated quite separately. 

The development of ECI really cam about to overcome some issues which were seen as problematic by an approach which encouraged the awarding of contracts solely on lowest tendered price. Hindsight showed such decisions suffered from false economies with value for money not achieved in either the final cost of construction or the whole life and operational costs. the response from the British Institution of Civil Engineering was to introduce ECI, where it was immediately adopted by the British Highways Agency (who had experienced many of the issues cited with lowest bid contracts). In the Southern Hemisphere, it wasn't until 2005 that ECI made an appearance, when introduced by Queensland Main Roads. This version of ECI was slightly different from that in UK, but remains essentially a more open and collaborative approach. 

New Zealand Government Procurement has their own set of guidelines. Note that these guidelines define ECI as 'an approach to contracting that can compliment either a traditional or novated design and build delivery model'. Thus showcasing the differences between our approach and the more defined, controlled version used in the United Kingdom.

How Early Contractor Involvement works in New Zealand

ECI in NZ usually takes a two stage approach to tendering. The first stage tender documents typically involve early design information, some initial budgetary guidance and a pre construction services agreement (PSA) with details of the services required to be provided by the contractor.  

After evaluation of the first stage, the preferred contractor is appointed for the second stage of the tender process. It's during this stage where the design team and contractor work collaboratively, the contractor providing the necessary input to design and develop the tender price on an open-book basis. At the conclusion, the contract is awarded (or not if certain conditions of the PSA have not been met).

This differs from the traditional design-bid-build approach, which separates stages into defined areas with little overlap. There is little or no collaboration, which is precisely where many of the drawback of this approach surface at a later date, often when any changes come with maximum disruption and cost. 

Advantages of Early Contractor Involvement

Compared to the traditional method, one of the standout advantages of ECI is the ability to truncate the project timeline. 

The overlap between designer and contractor provides collaboration and efficiencies that work to reduce waste (e.g. time), which are essentially the key traits of a lean delivery.

These advantages become clearer when we compare and contrast the traditional method vs ECI:

This, whilst certainly relevant, is somewhat generic and doesn't dive into the details or specifics of how we work within a nuanced version of ECI for maximum benefit. 

How Do We Approach ECI with Architects for Facades?

The simple answer is we adapt the process to suit the requirements and wishes of the architects. The more complication (and detailed) answer highlights the benefits of an integrated design process, drawing upon the findings of the Norwegian research paper 'Early Contractor Involvement: Advantages & Disadvantages for the Design Team' (Sodal et al, 2014). This paper set out to answer the question; "How will the early involvement of a contractor affect the work of architects and engineers?". Their findings are reflected in our own experiences and worthy of highlighting.

Improved Constructability

Constructability is commonly defined as the '... optimum use of common knowledge and experience in planning, design, procurement, and field operations to achieve overall project objectives'. Yet with facades we have a relatively unlimited canvas for design and artistic expression, all of which has to be constructed and attached to the building. With so much potential variation in design, whilst common fixing methods might be utilized they are not necessarily the most suitable for the project. This is where our input can have a very real and meaningful impact when it comes to achieving the architectural intent. Further, the technical solutions many provide advantages relating to cost, schedule, production safety and quality. A case in point in Burwood Hospital, where we developed an alternative solution and differentiated construction methodology that provided project savings of $1 million. 

Improved Risk Management

Given the highly charged litigious environment we find ourselves in, the ability to mitigate risk as comprehensively as possible has to be highly desirably. ECI aids in the identification and quantification of risk, the collaborative approach working as designed and pooling expertise for the benefit of all parties involved. For example, the tubular veil that adorns the exterior of the Outlook Apartments had the potential to become a musical instrument which no-one wanted to hear. Following testing for wind noise the project was able to progress, confident in the knowledge the finished product would not produce adverse aeroacoustics tonal noise, the risk having been successfully identified and mitigated at a time when expense was minimal (compared to any cost of remedial works should a tonal noise have been present).

Improved Cost Estimation

It follows that the collaborative approach which brings benefit to constructability should also improve the cost estimation. Early involvement and the ability to foresee issues, making any design changed before they impact construction and requirement from remedial works, allows for better cost control. Indeed, this should be highlighted as one of the core drivers for adopting the ECI methodology. 

Overall, the front loading of time and energy in the design, with an iterative approach and whole-system thinking, has a widespread benefit for both the developer and architect. The developer is more likely to see a project come in on time and on (or under) budget, the architect is more likely to see their architectural intent realised. 

In our experience, early contractor involvement has always delivered multiple benefits and an end result which more closely aligned with the architectural intent. Indeed, not pursuing an ECI approach either effectively reduces the expertise on offer or brings in its benefits at a later time when it is likely more costly and interruptive to the project. 

Related Reading

New Zealand Government Procurement: ECI Construction Procurement Guidelines

What is Early Contractor Involvement & How Does it Work?

Early Contractor Involvement: Advantages & Disadvantages for the Design Team

The Use of Early Contractor Involvement in Different Countries