CM at Risk vs. IPD—The Breakdown

Integrated Project Delivery has generated a buzz in the industry. But many industry professionals have not yet had an opportunity to participate in an IPD project. Contrasting IPD with the Construction Management at Risk delivery method may illustrate how IPD differs strikingly from more traditional delivery systems:

Topic	CM at Risk	IPD
Timing of CM Involvement	Executed after design is underway	Executed before design begins
Contracting Parties	Owner and CM	Owner, CM and designer(and key consulting designers, trade contractors and/or suppliers
Relationship between CM and A/E	CM is arms-length advisor via owner contract	CM has direct contract with designer
Collaboration by CM, A/E and Owner	Expected but not contractually specified	Required by contract
CM Involvement in Design	Expected, based on date of involvement	Intensified, based on earlier involvementand greater investment; parties may be colocated full time
Construction Funding	Cost of work plus agreed fee with Guaranteed Maximum Price	Open-book cost-plus; with target pricing but no GMAX
Potential CM Reward	Fee, often supplemented by shared savings	Shared financial rewards, incentives
Risk of Cost Overruns	Capped by GMAX	Determined by contract
Liability	By contract	Limited by agreement
Consequential Damage Waivers	Often negotiated	Addressed in form contracts, expected by parties
Financial Transparency	CM costs may be transparent; A/E and trade costs likely not	Agreed cost transparency of all signatories
Project Objectives	Determined by owner, with A/E input	Developed jointly by all key participants
Management	Responsibilities defined by contract; roles defined by personalities	Shared management, defined by contract, with roles enhanced by investment and potential incentives
Focus of Participants	Traditional self-interest	Best interests of the project as a whole
Motivation of Participants	Traditional self-interest	Enhanced by investment in process and potential incentives; participants expected to perform based on project interests
Roles of Participants	Defined by contract	Developed by agreement of parties
Efficiencies Achieved by Participants	Determined by individual conduct	Influenced by conduct of other parties, to the extent that they put project interests ahead of self-interest

Note that this summary is intentionally generalized. The differences described above can be affected by a) the forms that CM @ Risk and IPD take, b) the behavior of the individual participants and c) the corporate cultures of the owner, CM and A/E. CM @ Risk could look very much like IPD in some cases (and vice versa).