Choosing the right project delivery method significantly impacts construction project success. The two most common approaches—design-build and design-bid-build—offer distinct advantages and present different opportunities for contractors.
This comprehensive guide compares these delivery methods, helping contractors understand how each works and position themselves for success in either approach.
Understanding Project Delivery Methods
Project delivery methods define the contractual relationships between owners, designers, and contractors, determining how design and construction responsibilities are allocated.
What Is Design-Bid-Build?
Design-bid-build (DBB) is the traditional project delivery method:
- Design Phase: Owner hires an architect/engineer to prepare complete construction documents
- Bid Phase: Owner solicits bids from contractors based on completed design
- Build Phase: Selected contractor constructs the project
The owner holds separate contracts with the designer and contractor, who have no direct contractual relationship with each other.
What Is Design-Build?
Design-build (DB) combines design and construction under a single contract:
- Selection Phase: Owner selects design-build team based on qualifications and/or price
- Design Phase: Design-builder develops design (often with owner input)
- Build Phase: Design-builder constructs the project
The owner holds one contract with the design-builder, who is responsible for both design and construction.
Comparing the Approaches
Understanding the key differences helps contractors position for success.
Contractual Structure
Design-Bid-Build
- Owner contracts separately with designer and contractor
- Designer and contractor have no direct contract
- Clear separation of responsibilities
- Owner coordinates between parties
Design-Build
- Single contract with design-build entity
- Design and construction integrated
- Single point of responsibility
- Contractor often leads the team
Design Responsibility
Design-Bid-Build
- Designer solely responsible for design
- Complete documents before bidding
- Contractor not involved in design decisions
- Errors in design are designer's responsibility
Design-Build
- Design-builder responsible for design adequacy
- May use in-house or subcontracted design
- Contractor influences design decisions
- Design risk shifts to design-builder
Procurement Process
Design-Bid-Build
- Competitive sealed bidding typical
- Award based primarily on price
- Complete documents enable direct comparison
- Lower price usually wins
Design-Build
- Various selection methods (qualifications, best value)
- Price and qualifications often both considered
- Proposals evaluated on multiple factors
- Best value may outweigh lowest price
Project Timeline
Design-Bid-Build
- Sequential process (design, then bid, then build)
- Longer overall duration
- No overlap between phases
- Clear completion of each phase
Design-Build
- Overlapping phases possible (fast-tracking)
- Potentially shorter duration
- Construction can begin before design complete
- Faster project delivery
Advantages and Disadvantages
Each method has distinct pros and cons.
Design-Bid-Build Advantages
For Owners
- Competitive pricing from complete documents
- Independent design with owner's interests
- Clear accountability for each party
- Familiar and well-understood process
- Maximum price competition
For Contractors
- Clear scope from complete documents
- Reduced design risk
- Focus on construction expertise
- Price-based competition clarity
- Established contractual relationships
Design-Bid-Build Disadvantages
For Owners
- Longer project duration
- Limited contractor input during design
- Potential adversarial relationships
- Design-construction conflicts possible
- Owner manages coordination
For Contractors
- No influence on design decisions
- Must identify design issues through RFIs
- Potential design errors impact construction
- Change order disputes common
- Strictly price-driven selection
Design-Build Advantages
For Owners
- Single point of accountability
- Faster project delivery possible
- Contractor expertise informs design
- Reduced coordination burden
- Better integration of design and construction
For Contractors
- Input on design decisions
- Control over constructability
- Early involvement in project
- Selection on qualifications, not just price
- Stronger owner relationships
Design-Build Disadvantages
For Owners
- Less design control and independence
- More complex procurement
- Potentially higher prices without competition
- Reliance on single entity
- Difficulty comparing proposals
For Contractors
- Design liability and risk
- Higher pursuit costs
- Need for design capabilities
- More complex project management
- Greater overall risk exposure
Contractor Opportunities in Each Method
Both methods offer opportunities for contractors who understand how to succeed.
Succeeding in Design-Bid-Build
Bidding Strategy
- Focus on accurate, competitive estimating
- Identify constructability issues early
- Build strong subcontractor relationships
- Develop efficient execution plans
- Manage risk through thorough bid review
Execution Excellence
- Effective RFI and submittal processes
- Proactive change order management
- Strong quality control
- Schedule management expertise
- Clear documentation
Relationship Building
- Work collaboratively despite contract structure
- Partner with design teams when possible
- Build reputation for problem-solving
- Develop repeat client relationships
Succeeding in Design-Build
Building Capabilities
- Develop or acquire design resources
- Partner with quality design firms
- Build integrated project teams
- Develop preconstruction services expertise
- Create design-build portfolio
Pursuit Strategy
- Target appropriate design-build opportunities
- Invest in proposal development
- Showcase relevant experience
- Demonstrate team integration
- Present compelling solutions
Risk Management
- Understand design liability implications
- Ensure adequate insurance coverage
- Develop thorough design review processes
- Build design-build expertise
- Price risk appropriately
When Each Method Works Best
Project characteristics influence optimal delivery method selection.
Design-Bid-Build Works Best For
Project Types
- Well-defined, standard building types
- Projects with complete design requirements
- Public projects with competitive bidding requirements
- Projects where lowest price is primary objective
- Simple renovations and improvements
Owner Situations
- Owners with strong project management capability
- Organizations requiring maximum price competition
- Entities with established design relationships
- Projects where design control is paramount
- Limited risk tolerance for integrated delivery
Design-Build Works Best For
Project Types
- Complex projects benefiting from contractor expertise
- Fast-track schedule requirements
- Projects where innovation is valued
- Performance-specified projects
- Unique or specialized facilities
Owner Situations
- Owners wanting single-point responsibility
- Organizations with limited project management staff
- Entities comfortable delegating design decisions
- Projects where speed is critical
- Owners valuing long-term partnerships
Market Trends
Understanding trends helps contractors plan strategically.
Growing Design-Build Market
Design-build continues to gain market share:
- Now represents approximately 45% of construction spending
- Fastest growing delivery method
- Strong growth in public sector
- Increasing adoption by institutional owners
Factors Driving Design-Build Growth
Several trends favor design-build:
- Schedule compression demands
- Desire for integrated teams
- Public sector delivery method reforms
- Success with early projects
- Owner sophistication with method
Design-Bid-Build Remains Important
Traditional delivery still significant:
- Approximately 40% of construction spending
- Required by many public entities
- Appropriate for many project types
- Well-understood by all parties
- Strong price competition benefits
Building Design-Build Capability
Contractors seeking design-build opportunities should develop capabilities systematically.
Team Development
Build or access design resources:
In-House Design
- Hire design professionals
- Develop internal design capabilities
- Create integrated organization
- Invest in design technology
Design Partnerships
- Partner with design firms
- Create teaming agreements
- Develop preferred relationships
- Pursue joint ventures
Process Development
Create design-build processes:
- Integrated team management
- Design phase involvement
- Constructability review procedures
- Quality assurance systems
- Risk allocation frameworks
Experience Building
Develop track record:
- Start with smaller design-build projects
- Build portfolio of successes
- Document lessons learned
- Develop case studies
- Showcase capabilities
Frequently Asked Questions
Can a general contractor do design-build without design staff?
Yes. Many contractors partner with architecture/engineering firms for design services, creating design-build teams through teaming agreements or joint ventures without having in-house design staff.
Does design-build always cost more than design-bid-build?
Not necessarily. While design-bid-build maximizes price competition, design-build can reduce costs through improved coordination, reduced change orders, and faster schedules. Total project cost depends on many factors.
Are design-build projects riskier for contractors?
Design-build involves design liability that contractors don't assume in design-bid-build. However, contractors also have more control over the design, potentially reducing construction risks. Risk must be managed through insurance, contracts, and processes.
How do public agencies procure design-build projects?
Public agencies use various methods including qualifications-based selection, best value procurement, fixed-price design-build, and progressive design-build. Requirements vary by jurisdiction and enabling legislation.
Which delivery method is better for contractors?
Neither is universally better. Success depends on contractor capabilities, project fit, and market conditions. Many successful contractors work in both delivery methods.
Conclusion
Both design-build and design-bid-build offer opportunities for contractors who understand each method's requirements and position themselves appropriately. Design-bid-build rewards competitive pricing and execution excellence, while design-build rewards integrated capabilities and collaborative approach.
Evaluate your organization's capabilities, target market, and strategic direction to determine how to position for success in each delivery method. Many contractors benefit from developing capabilities in both approaches.
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