Understanding CM/GC. Pt. 2 - Procurement Process
This article is the second part of our "Understanding CM/GC" series - be sure to check out Part 1, "CM/GC - Methodology."
The CM/GC selection process is designed to identify the Contractor best suited to meet the project's specific needs. Unlike traditional Design-Bid-Build, the Owner evaluates, scores, and selects the Contractor based on qualifications rather than the lowest bid.
What is the typical CM/GC procurement timeline?
Owners may opt to evaluate and select a contractor in a 1-Step procurement based on written qualifications only ("Direct Select") or a 2-Step procurement which includes a shortlist of highest-ranked firms and team interviews.
Using a 1-Step procurement, Owners typically provide 4-6 weeks from when the project is advertised to when the written response is due. The amount of time Owners need to evaluate, score, and rank submittals vary, but Contractors can anticipate no longer than 4-6 weeks. Thus, from the project advertisement to the final section, plan for three months.
2-Step procurements are similar, but expand the timeline to accommodate the Project Interview. Typically in 2-Step procurements, the interview is quickly followed by the owner's final ranking and notice of award.
How does CM/GC selection work?
Here's how the process typically unfolds:
Owner Determination of Need and Applicability
First, the Owner identifies the need for the CM/GC model, usually in scenarios where complex or technically challenging projects require high expertise and collaboration. It's also important to note that public agencies must have the authority to use the CM/GC model, typically granted through specific legislation or rules in their jurisdiction.
Request for Qualifications (RFQ) or Request for Proposals (RFP)
The Owner issues a RFQ or RFP clearly outlining the project requirements, objectives, and criteria for selection. In response, the Contractor identifies key personnel, qualifications, experience, and their approach to the project. Interested contractors submit written, narrative proposals detailing their capabilities, innovative ideas, solutions, and potentially a price component like a construction management fee. The statement of qualifications or proposal must clearly demonstrate how the Contractor intends to meet the project's objectives and include their approach to risk management, scheduling, cost optimization, and other critical aspects.
1-Step or Direct Selection: The Owner evaluates the proposals using an established, transparent scoring matrix based primarily on experience, qualifications, and innovative concepts. Evaluation criteria may be weighted based on the project's unique needs and priorities. Price components (e.g., the construction management fee or hourly fee structure for key personnel to participate during the preconstruction phase) may be factored into the evaluation but typically represent less scoring potential than the qualifications-based elements. After evaluation and scoring, the Owner selects a single, best-qualified firm and issues a Notice to Proceed for Preconstruction Services.
2-Step: Similar to a 1-Step procurement, the Owner will evaluate the proposals based on the various criteria described in the RFQ/RFP; however, the Owner will then establish a shortlist of high-scoring proposer teams. Shortlisted firms are then invited for interviews or presentations, allowing them to present their proposed team members and approach to the project in greater detail.
Interviews and Presentations
During interviews, the Owner assesses the competency and capability of each competing team. The interview provides a platform for the Contractor to articulate their understanding of the project, demonstrate their expertise, and present innovative solutions. Interviews also help the Owner to gauge the Contractor's communication skills and evaluate how well they align with the project's requirements and the owner's values.
Additional interview elements may include:
Challenges or Real-Life Scenario Exercises - The Owner may present real-life project scenarios by questioning and assessing how the Contractor would manage conflicts, overcome challenges, and work within constraints.
Evaluation of Team Dynamics - The interview helps the Owner determine the comfort level with the Contractor's proposed team members, evaluating how well their personalities and work styles represent a unified team and a good fit for the project.
Price and Contract Negotiation Process Discussions - The interview may also delve into the means and methods the Contractor will use to clearly and transparently develop, vet, and negotiate costs on the project. The interview helps the selection committee gain insight into the Contractor's financial expectations and approach to contractual agreements.
Based on the evaluations, interviews, and other scored elements, the Owner selects the Contractor that best meets the project's requirements and delivers the "best value" overall to the project. It is important to note that the selection of the Contractor is for the preconstruction phase of services only.
At the close of preconstruction, the acceptance of the final project cost by the Owner typically initiates the start of the construction phase with the execution of a new, separate contract and issuing a Notice to Proceed for Construction.
CM/GC is a procurement and delivery framework that blends collaboration, efficiency, risk management, and innovation to deliver the best project value overall. The success of the method and the ease of adoption make CM/GC one of the most widely-used APD models in North America.
Qualifications-based selection helps Owners gain the best-experienced teams and value for unique and challenging projects. Preconstruction collaboration between the designer and contractor fosters innovative approaches to manage risk, reduce public impacts, and often accelerate project timelines. CM/GC creates a strong parity between the Owner's goals, the Designer's plans, and the Contractor's best means and methods for constructing the project.
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Explore the first article in Mission Critical's "Alternative Project Delivery 101" series: APD 101 - What is Alternative Project Delivery?
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