“This can extend for a number of months, when a
whole bunch of things happen. Owners, and design and
construction teams meet intensively to take this gleam in
the owner’s eye and turn it into something that will be
sufficient to allow a go/no go decision.”
During this time, the team coalesces psychologically,
with a project management team, senior management
team and project implementation teams.

“At this stage, the design is worked up to a point,
where a base target cost can be comfortably deter-
mined,” Banfai said. “The site investigations are done,
usual due diligence along the way is done, all under the
management of the project team.”
Participants conduct meetings where the expected
profits are identified and tabled in an open-book way so
as to establish a Risk Pool, and risk allocation percent-
ages are determined.

Then a “validation report” is produced, which “essen-
tially is the business case for the project.”
If the business case cannot be met,the owner has the
option of terminating the contract, paying the design and
construction team for their costs but not their profit.

“The profit of the construction and design team mem-
bers is at risk from day one.”
If the project is a “go”, then the design and procure-
ment phase commences, overlapping slightly with the
construction phase which follows. During design and
procurement, the design is refined taking constructability
and value engineering into account and looking for ways
to “tweak the design so as to bring greater value to the
owner for the dollars committed and/or savings, and at
the conclusion of which you come up with a final target
cost.” “This number is the one that really matters for risk
pool distribution purposes,” Banfai said. “The idea is that
during the design and procurement phase, the parties
seek to find innovations and savings.”
Typically, this work is done collaboratively in a “big
room” -- with desks, computers, blueprint machines,
cork-boards and whiteboards on the walls and sticky
colour coded notes.

The concept is new and the speakers acknowledged
that while it is “taking off slowly in Canada, more and
more (IPD projects) are coming on line.”
“I don’t want to suggest this is for everybody,” Banfai
said. “It starts with an owner who gets it.”
Earlier in the session, lawyer Banfai said he believes
the most important quality for project success or failure
are the individuals running the job.

“It’s amazing how just one person – the wrong person
– can completely screw up a project,” Banfai said. “Multi-
million dollars worth of failure, can happen because of
one sociopath.”
Banfai said it is important to get these troublesome
people out of the job as soon as possible.

“Sometimes it is really hard, especially if the individual
is at the top of the food chain,” he said. “That is a real
problem. The only effective way is that you have to re-
move this person from the project one way or another.”
“If the problem is at the project management level, it
helps if the senior management and the members of the
project team have a strong relationship and strong social
trust, so that they can have these candid conversations
about “Frank” and have the troublemaker removed.”
Fortunately, these issues would become apparent and
be resolved early in true IDP projects, where CCDC-30
would be used.

www.threadsoflife.ca 6 – Spring 2018 — The Canadian Design and Construction Report