Integrated Project Delivery Projects Research Articles

Using Bibliometrics and Grounded Theory in Investigating Factors Influencing Profit Distribution in Integrated Project Delivery Projects

Integrated project delivery (IPD) has gained significant attention as an effective alternative to traditional project delivery models. Profit distribution is a crucial aspect of IPD projects, influencing their overall success. This study aims to investigate the key factors impacting profit distribution to offer strategic guidance for project management practices. The study employs a comprehensive bibliometric analysis to establish an updated research framework in this domain. Through this analysis, 24 articles with highly relevant and extensively cited sources are identified for further examination. Grounded theory is subsequently applied to distill the findings. This process yields a foundational theoretical framework that delineates the factors influencing profit distribution in IPD projects, namely, contribution, resource-based input, effort level, and risk sharing. Additionally, a textual analysis of ten burst words is conducted to discern research trends and identify future areas of study. This research contributes to the existing literature by addressing gaps and providing a roadmap for future IPD investigations. A theoretical framework of influencing factors in profit distribution in IPD projects is developed based on the literature. The findings not only enhance understanding of profit distribution dynamics in IPD projects but also guide the implementation and optimization of IPD practices.

Lean in the public sector in Finland.

Finland is undergoing an immense change in the execution of real estate development and construction projects. Since 2011 nearly 100 projects have already been launched in the country with the Integrated Project Delivery (IPD) principle. The total value of the projects is close to 7.3 billion euros. The principles of integration are currently applied especially to project management contracts, but also to other traditional contract models with fixed content or fixed price. Implementation of the IPD models has triggered a change in work culture and practices across the whole construction field. Focus within the traditionally somewhat quarrelsome and fragmented industry has now shifted towards cooperation and continuous improvement – both important Lean principles. Experience from the integration of contracting authorities and service providers has shown the advantages to be achieved. The contracting authority can utilize the know-how of different parties from the start of the project, as designers and builders are planning ways of execution together. A joint development phase leads to better planning and more accurate budgeting as well as better commitment of different parties. The use of IPD models has also served as a significant basis for introducing Lean principles and tools in Finland. Without IPD models, especially the customers' awareness of the benefits of Lean methods would have remained low. Furthermore, the sharing of risks and benefits encourages the execution of projects with stricter adherence to budget and schedule. So far, all completed IPD projects have achieved the target schedule and budget. Despite minor shifts in the cost targets of the projects, all contracting parties have been satisfied with the achieved results.

Research on Profit-Sharing Mechanism of IPD Projects Considering Multidimensional Fairness Preferences and BIM

The integration of building information modeling (BIM) and the integrated project delivery (IPD) mode effectively promotes collaboration among project members and enhances project profitability. However, the issue of profit sharing significantly impacts the successful implementation of IPD projects. To enhance the profit-sharing mechanism of IPD projects and ensure their smooth implementation, a game analysis model of profit sharing in IPD projects was established based on the Stackelberg game theory, taking into account the multidimensional fair preferences of the participants and the application of BIM technology. Through simulation, the impact of various parameters of participants on output utility, total revenue, and sharing coefficient in IPD projects was analyzed. The results show that: (1) participants achieve their highest output utility and total revenue under vertical–horizontal fairness preferences; (2) under vertical fairness preferences, the profit sharing coefficient is the highest, while the output utility and total revenue are the lowest; (3) although the output utility and total revenue of participants under horizontal fairness preferences exceed those under neutral fairness preferences, the profit-sharing coefficient is lower; (4) the output utility, the total revenue, and the profit-sharing coefficient of the participants all increase with the increase in effort utility value and decrease with the increase in the effort cost coefficient and the risk avoidance coefficient. The research findings provide valuable theoretical support for the profit sharing of IPD projects, thereby further promoting the advancement and implementation of the IPD model.

Optimum risk/reward sharing framework to incentivize integrated project delivery adoption

The major benefit of integrated project delivery (IPD) is the involvement of stakeholders at the early stage of the project so that they can all contribute to project development. They would also work cooperatively towards the project goals that they have jointly developed. Moreover, IPD has not taken the market as promised by the aforementioned benefits due to two principal concerns. First, the conventional risk/reward sharing that has been developed for the principal-agent type of relationship has been used. Second, the reward has not been tailored to reflect the stochastic nature of the risks involved. This study proposes a novel risk/reward sharing framework that would alleviate these two concerns. Employing stochastic cooperative game theory and prospect theory as conceptual lenses, a more realistic risk/reward sharing framework is developed for IPD projects. The use of Pareto optimality enables the proposed framework to arrange incentives optimally with due regard to the risk propensity of the contracting parties. Setting the notional sharing approach as a fair starting point, the framework further introduces transfer payments to ensure fairness and retain optimum sharing at the same time. Both features would facilitate the structuring of multi-win sharing incentive to be incorporated with integrated project delivery. The operation of the proposed framework is illustrated by applying it to a real case. Wider adoption of IPD can be expected when the two principal concerns of IPD arrangements are addressed.

Optimal Planning of Renovation Work in Leased Buildings under Integrated Project Delivery Method

This paper presents the development of a novel model for optimizing the planning of renovation work in leased buildings that utilize the integrated project delivery (IPD) method to maximize the income of leased units during renovation work. The present model is developed in two main phases: optimization and renovation planning. The model integrates a novel methodology that enables decision makers to select optimal crew deployment data and number of assigned crews for all renovation activities, identify an optimal unit renovation order of all leased units, generate feasible renovation schedules, and quantify and minimize total net renovation cost. A real-life case study of three renovation projects was analyzed to illustrate the use of the model and demonstrate its capabilities. The results of this analysis clearly illustrate the original contributions of the model to the body of knowledge and its novel capability in generating optimal renovation schedules for leased buildings that enable contractors to maximize their share of rewards under IPD projects while minimizing their total renovation cost.

The concept of integration in an IPD context: a grounded theory review

PurposeRecent construction literature has been focusing more on integrative contracting approaches such as integrated project delivery (IPD). However, conceptual studies on integration in IPD literature are scattered and fragmented, that is, most of the studies only focused on the segmented dimension of integration. A systemic understanding of the concepts of integration in IPD project-based context is still lacking. To fill this gap, this paper analyzes two aspects of integration (dimensions and directions) in IPD literature and explores their extent in construction projects.Design/methodology/approachGrounded theory review and focus group discussion approaches were employed to perform a thorough conceptual review of the literature, frame the research into the theory and increase the fundamental understanding of the concept of integration in IPD literature.FindingsIn this study, IPD integrating techniques were identified and their integration dimensions and directions were discussed. Results show that integration in the project-based environment of IPD is a multidimensional construct. Based on organizational, contractual and operational characteristics of IPD projects, twenty-four integration mechanisms were identified and framed into seven clusters. The integration directions over project life-cycle were demonstrated in three contexts: (1) an on-site construction project, delivered traditionally, (2) an on-site construction project, delivered with IPD and (3) an off-site construction project, delivered with IPD.Originality/valueThis paper gathers the segments of integration into a comprehensive overview, which can help researchers and practitioners explore elements of IPD project success more precisely. A theoretical framework of integration clusters is developed, based on IPD literature. The impact of IPD on on-site versus off-site construction is illustrated from an integration direction perspective. Finally, future areas of studies for researchers and practitioners about the concept of integration in an IPD context are discussed. This paper provides a point of departure for future theoretical and empirical explorations.

The influence of effort level on profit distribution strategies in IPD projects

PurposeConstruction projects have become increasingly long, complex and costly with waste and inefficiencies and often fail to achieve the desired results. Integrated project delivery (IPD) is believed to change these problems. A reasonable and fair profit distribution mechanism is a critical factor for ensuring the success of the IPD projects. This study aims to investigate the strategies of all participants in the profit distribution of an IPD project with respect to the factor of the effort level.Design/methodology/approachThis study describes the influence of owners and participants on profit distribution due to their respective efforts in the IPD project alliance. The influence of effort level on profit distribution is discussed based on the Holmstrom-Milgrom model of asymmetric information game theory and principal-agent theory, combined with incentive compatibility (IC) constraints and individual rationality (IR) constraints.FindingsThe results show that the optimal level of effort by each participant optimizes the profit distribution of an IPD project. At the same time, in the revenue incentive contract, the effort level of the participants is positively correlated with the profit distribution, proportional to their contribution coefficient and inversely proportional to the square of the cost of their creative activities in terms of effort. Each party of an IPD project can adopt a series of measures to improve their own effort level and choose the optimal level of effort based on the profit distribution, while satisfying their own utility maximization.Originality/valueThis study introduces the Holmstrom-Milgrom model in the principal-agent theory to explore the influence of the effort level on profit distribution in IPD projects. The quantitative model can contribute to establish a fair and efficient profit distribution scheme for the IPD projects.

Transforming project delivery: integrated project delivery

Abstract The design and construction industry has long suffered low productivity and poor project outcomes. Collaborative approaches to project delivery offer an opportunity to transform outcomes by creating incentives in an environment that incentivizes high performance. This paper examines integrated project delivery (IPD), a collaborative contractual approach that alters a project’s fundamental commercial, organizational, and legal structures to minimize dysfunction and stimulate performance. IPD’s basic structures are introduced, followed by a critical examination of current and new research on IPD augmented by the author’s insights from structuring over 150 IPD projects. An online appendix provides additional information regarding the reasoning behind the IPD structures.

Influence of Integrated Project Delivery Principles on Project Performance in China: An SEM-Based Approach

Although integrated project delivery (IPD) is still in its infancy in the construction industry worldwide, some principles can be effective without formal contractual languages and enforcements when IPD is employed as a philosophy as opposed to a delivery method. This paper aims to investigate the effect of IPD principles on project performance in China, providing a reference for improvement of project performance by the application of IPD principles in countries or regions where IPD is considered as a philosophy. A total of 205 data samples were collected from different IPD-related participants in China via a questionnaire survey. Eight hypotheses are proposed based on a literature review, and these are verified using a structural equation model (SEM). According to the results of the exploratory factor analysis, IPD principles, including behavioral principles, contractual principles, collaboration-related principles, and catalysts, are classified, and the internal relationship of various IPD principles is explored using SEM to analyze the impact path between IPD principles and project performance. It was discovered that project performance is directly affected by collaboration-related principles and catalysts. The contractual principles have positive impacts on both behavioral principles and collaboration-related principles, while the catalysts show positive impacts on behavioral principles. This work provides insights and managerial implications for local applications of IPD for construction practitioners, which should be considered by promoting regional IPD practices; it contributes to both theoretical and practical perspectives for improving project performance by the effective implementation of IPD in construction projects.

Unveiling Embedded Risks in Integrated Project Delivery

Integrated Project Delivery (IPD) is an innovative procurement approach through which the client, designer, and contractor work together under one contract as a team. While an integrated team is expected to be able to create extra value for the project, this practice may bring new risks if not all team members are committed. The slow uptake of IPD may possibly be due to the insufficient understanding of the risks involved, especially those hidden risks associated with inappropriate integration practice. This study identifies critical risks in IPD projects, and investigates if risk criticality can be alleviated by having previous or future partnership between IPD partners. By collecting the views of construction professionals on the level of criticality of general risks and IPD-specific risks, it is found that (1) most highly critical IPD project risks are borne from multidisciplinary teams of poor integration quality, inaccurate target costs, or unreasonable cost estimates; and (2) having future cooperation intent can significantly alleviate the criticality of certain IPD risks, whereas no effect of previous partnership was found on risk criticality. This study contributes to a growing body of knowledge on IPD by providing insight into the effect of new and general risks on IPD project outcomes in particular and clarifying the role of previous/future partnership in risk management. This study suggests active involvement of client and contractors in the design of IPD and signals future cooperation intent to IPD partners during the project process.

PROFIT DISTRIBUTION IN IPD PROJECTS BASED ON WEIGHT FUZZY COOPERATIVE GAMES

Integrated Project Delivery (IPD) is regarded as an effective project delivery method that can deal with the challenge of the rapid development of the architecture, engineering, and construction (AEC) industry. In the IPD team, the alliance profit is not distributed fairly and effectively due to uncertainty, preventing the achievement of the IPD project goals. This study focuses on optimizing the profit distribution among stakeholders in IPD projects and uses quadratic programming models to solve fuzzy cooperative games in the IPD. A payoff function is used in the fuzzy alliance to determine the characteristics of the interval-valued fuzzy numbers, and different weights of the alliance and the efficiency of the player’s participation in the IPD are considered in the profit distribution. A case study is conducted, and the results of the proposed method are compared with those of crisp cooperative games. The results show that the fuzzy cooperative game increases the profit of participants in IPD projects. It is more practical to use weight fuzzy cooperative games than crisp games to express imputation. Moreover, the quadratic programming models and methods result in a fair and efficient profit distribution scheme in IPD projects.

Profit distribution of IPD projects using fuzzy alliance

PurposeThis paper examines the profit distribution of engineering projects in the integrated project delivery (IPD) mode. IPD is a new delivery method that can ameliorate many of the disadvantages of traditional delivery methods and improve project results. In the implementation of IPD, the profit distribution is key for ensuring the success of IPD projects.Design/methodology/approachThis paper described a new method for characterizing profit distribution in the IPD mode. The payment function and Shapley value of the cooperative fuzzy game of fuzzy alliance were defined by considering the Choquet integral of the fuzzy measure. The participation of each player was considered, and the influence of participation on the profit distribution was discussed. Lastly, changes in the profit distribution of core participants under different alliance combinations were studied.FindingsA case from a report of The American Institute of Architects (AIA) was used to verify the fuzzy alliance model. There was a significant correlation between the degree of participation of the owner, architect and builder and the profit distribution among these three participants.Research limitations/implicationsThe theoretical research in this paper has some limitations. Initially, this paper selects a case with only three key participants in order to simplify the research. When there are many core participants, how to establish the alliance in the IPD mode and how to establish the corresponding profit distribution model, further work is certainly required to disentangle these complexities in models. Second, in this case, BIM technology has little impact on the income of the whole project. Therefore, this paper does not consider the impact of BIM technology on the marginal effect of the IPD project. Third, the contract type in the case is a custom tri-party based on IFOA. There is no classified discussion of the impact of different contracts on the profit distribute in the paper.Practical implicationsBased on the in-depth study of cooperative game with alliance structure, this paper promotes the classic cooperative game with alliance structure. The authors define the payoff function of fuzzy cooperative games by Choquet integral of fuzzy measure, and introduce the idea into the field of IPD. It aims at extending the solution to a cooperative game without a core. It can be obtained through a simple calculation. In the IPD alliance, the fuzziness and uncertainty of the participation degree of each participant will affect the profit of the whole project. The authors find that the higher the participation rate of players, the more profit each participant has. The greater the influence weight of the designer on the alliance, the lower the influence weight of the contractor on the alliance, the lower the participation of the contractor and the designer, and the lower the income distribution value of the three core participants. It shows a monotonous decline status.Social implicationsFor any construction enterprise, it can make more profits if it joins the grand alliance. In the IPD alliance, each participant can maximize their own interests, which can also promote the enthusiasm of construction enterprises to participate in the alliance and increase the application of IPD mode in AEC industry. This research method provides a new fast, effective, and more realistic solution method for cooperative countermeasures. It can be further extended to other cooperative game fields and advance a new research perspective and solution for the distribution of cooperative interests.Originality/valueThe contribution of this paper is the development of a fuzzy alliance model that provides a tool for measuring the profit distribution in IPD. This is the first quantitative model to connect the degree of participation with the profit distribution in IPD using fuzzy alliance.

The effect of commitment differentiation on integrated project delivery team dynamics: The critical roles of goal alignment, communication behaviors, and decision quality

Recently, architecture, engineering, and construction (AEC) project teams have begun to adopt the integrated project delivery (IPD) method with increased frequency. This adoption has been made on the assumption that IPD will lead to beneficial project team dynamics and outcomes. Although novel and potentially useful, we contend that the mere implementation of the IPD method does not in and of itself guarantee successful project team dynamics and outcomes. In specific, in this manuscript we argue that commitment disparities between project team members are problematic for numerous project team dynamics and outcomes: goal alignment, communication behaviors, and decision-quality. Using data from 21 IPD project teams, we show this to be the case. Results from this investigation suggest that when members’ commitment levels vary within project teams, goal misalignment, poor communication behaviors, and reduced decision quality are expected to follow. Moreover, results suggest that this is especially likely to occur when members’ commitment levels are low as opposed to high. This work contributes substantially to our understanding of project team dynamics in the AEC industry, especially as they relate to those delivered under contractually followed IPD. Although the IPD method holds the potential to be beneficial, these results suggest that such benefits accrue only if team members’ commitment levels are both high and uniform. In the absence of such conditions, problematic team-level dynamics and outcomes are expected to ensue.

Factors Driving Success of Cost Management Practices in Integrated Project Delivery (IPD)

Integrated project delivery (IPD) is a mode of project procurement recognised as facilitating superior project performance. However, this success is contingent on effective cost management practices that share cost data with all project stakeholders in an accurate, timely and transparent manner. Despite an extensive literature on aspects of cost management, none identifies the essential ingredients required of an effective cost management system, sufficiently robust to support successful IPD projects. Candidate cost management augmenting practices are drawn from the literature, and presented for scrutiny in questionnaire form, to fifty IPD experienced experts, based in the USA, UK and Australia. Findings reveal activity-based costing (ABC) to be effective at identifying overhead costs and creating accounting transparency. Similarly, earned value management (EVM), in combination with ABC, is effective at developing mathematical models for equitable risk-reward distribution. Moreover, web-based management systems, as supported by Building Information Modelling (BIM), are effective at generating trust and collaboration on which IPD success depends. A questionnaire survey using purposive sampling was conducted to assess the factors driving success of implementing IPD regarding cost management process. The contribution to knowledge made by this paper is in identifying requisite support mechanisms essential to elevate traditional cost management practices to the higher standard needed to ensure IPD delivery success.

Data envelopment analysis based efficiency measurement of engineering change controlling for infrastructure construction under integrated project delivery mode

Engineering management is undergoing revolution and innovation due to the rapid development in smart city and infrastructure construction worldwide. Infrastructure construction projects, including large-scale transportation projects, usually have the characteristics of huge investment, long construction period, and complex construction technology. Engineering change controlling is an important part of project management in infrastructure construction. Owing to main participants’ early involvement and working on mutual trust and benefits, integrated project delivery (IPD) mode has significant advantages in reducing engineering change, and thus draws much concern in infrastructure construction. IPD is featured by implementing a range of fundamental principles. Previous studies were rarely involved in how to address these IPD principles in certain IPD projects. This study constructed an IPD projects’ change controlling efficiency evaluation system using data envelopment analysis (DEA), correlating the change controlling efficiency and the implementing of IPD principles. The authors established the evaluation model. It is demonstrated that DEA was a feasible way for IPD projects’ relative change controlling efficiency calculating. By analysing the case study results, the authors explored how to use IPD principle to promote the IPD projects to yield better results from the perspective of engineering change controlling.

Risk Sharing Strategies for IPD Projects: Interactional Analysis of Participants’ Decision-Making

AbstractIn the Integrated Project Delivery (IPD) approach, partner selection, contract signing as well as the signing of participants’ task scope, and the setting of incentive plans usually take pl...

Performance outcome assessment of the integrated project delivery (IPD) method for commercial construction projects in USA

This article presents the results of a quantitative study evaluating relationships between various project outcome metrics and the use of Integrated Project Delivery (IPD). Conflicting results within the literature about these relationships, coupled with significant industry interest, motivated this study. Data from 93 building construction projects were analyzed in a multivariate context controlling for the contribution of covariates unrelated to delivery methods. At the 95% confidence level (CL), significant performance outcomes were not found for IPD projects. Though, at the 90% CL, lower levels of cost and schedule growth were found to be significant for IPD projects when compared to projects completed using other common delivery methods. Also, IPD healthcare projects were found to have significantly fewer Requests for Information (RFI) than non-IPD healthcare projects. Lastly, urban projects showed significantly higher levels of cost and schedule growth, along with increased RFI and punchlist frequency counts, than either suburban or rural projects. Recommendations include exercising caution in the use of IPD as a means to check cost and schedule growth while improving design quality. Project owners should also moderate expectations that IPD is a solution to many of the industry’s problems as postulated by prevalent qualitative and trade literatures.

Modeling Supply Chain Integration in an Integrated Project Delivery System

The supply chain relationship is an essential factor in the performance of Integrated Project Delivery (IPD). The IPD system encourages the early involvement of key participants in the design stage. Consequently, this early involvement requires a new configuration of the supply chain relationship in the IPD system. However, there is a lack of knowledge in understanding the performance of the supply chain relationship in the IPD system. To fill this gap, we applied a simulation model, Virtual Design Team (VDT), to explore the dynamics of the supply chain integration in terms of project organization and project delivery process in design. This study presents a conceptual and qualitative analysis of the VDT model applied in two IPD projects. The results explored different behaviors of integration at inter-organizational and project levels throughout project organization, contractual and technological mechanisms of coordination. The project organization characteristics influence the performance of the construction supply chain.

Integrated project delivery with blockchain: An automated financial system

Integrated project delivery (IPD) in the architecture, engineering and construction (AEC) industry relies on risk/reward sharing and deferral of parties' profit payments until all project activities are completed. A decentralised, automated and secured financial platform is needed to enable all parties to control and track financial transactions, with no unauthorised changes allowed. The new technology, blockchain, enables data to be recorded, has no network participant with dominant power and manages data using specific functions, in line with smart contracts. The present study is the first to develop a framework proposing blockchain technology utilisation in IPD projects. The framework would enable core project team members to automatically execute all financial transactions, through coding the three main transactions of IPD projects: reimbursed costs, profit and cost saving, as functions of the IPD smart contract. To demonstrate the proposed framework's applicability, a “proof of concept” is developed and validated through an IPD case project. The practicality of the built-up hyperledger network (IBM® Blockchain Cloud Beta 2) and the advantages of the proposed smart contract functions are examined. The user-friendliness of the proposed financial system and its efficiency in automating all transactions are demonstrated. No deficiency is found in the blockchain network components. The study's findings, applied in a favourable external context, would facilitate IPD adoption and use across the AEC industry by providing a workable solution to existing financial barriers. The findings extend the horizon for further research on exploring blockchain's capabilities to solve comparable deficiencies to those affecting the AEC industry.

Developing a framework to revolutionise the 4D BIM process: IPD-based solution

PurposeThe integration of building information modelling (BIM) and integrated project delivery (IPD) is highly recommended for better project delivery. Although there is a methodology for this integration, the BIM requires some improvements to foster the adoption of IPD. The purpose of this paper is to present an innovative way to support 4D BIM automation/optimisation within the IPD approach. Similar to structural and architectural design libraries, this research proposes a planning library to enable automating the formulation of schedule, as well as embedding the multi-objective optimisation into the 4D BIM.Design/methodology/approachThe literature review was used to highlight the existing attempts to support the automation process for 4D BIM and the multi-objective schedule optimisation for construction projects. A case study was done to validate the developed framework and measure its applicability.FindingsThe results show that there is a cost-saving of 22.86 per cent because of using the proposed automated multi-objective optimisation. The case study shows the significance of integrating activity-based costing into 4D BIM to configure the hierarchy level of overhead activities with the IPD approach; therefore, the maximum level of contribution in managing the IPD project is 33.33 per cent by the trade package level and the minimum contribution is around 8.33 per cent by the project level.Originality/valueThis research presents a new philosophy to develop the 4D BIM model – planning and scheduling – a BIM library of the project activities is developed to enable the automation of the creation of the project schedule with respect to the 3D BIM design sequence. The optimisation of the project duration is considered to be automated within the creation process by using the proposed genetic algorithm model.