The Cost of Gaps and Overlaps
A common misconception is that the traditional Design-Bid-Build (DBB) project delivery method provides an owner with the lowest cost solution for their facility needs. Two of the hidden costs incorporated into DBB are the gaps and overlaps in the project scope. Gaps and overlaps cost the owner time and money during the initial project bid, and continue to cost the owner time and money through change orders during construction. What are these gaps and overlaps?
A gap is a gray area in the project scope, something that’s not clearly defined in the construction documents and unknown to the contractors asked to bid the project. A contractor, not having all the information needed to accurately bid the project, will need to overinflate their bid to verify that these gaps are covered. Unavoidably, some of these gaps aren’t covered by an inflated bid and are exposed during construction, leading to change orders and schedule delays.
An overlap is also an unclear, gray area in the project scope, but unlike a gap, multiple sub-contractors inadvertently acquire the overlap cost in their bids. The costs for this project scope are doubled, or more, as the general contractor tallies the bids. The general contractor’s effort is focused on compiling their bid, rather than coordinating the entire scope of the project to eliminate this waste. In the end, the cost of these overlaps is directly passed on to the owner without contributing any benefit to the project.
There is a better way, Design-Build (DB). When an owner chooses to select a complete project team (architect, engineers, general contractor and key sub-contractors), the owner is bringing together the people needed to identify and eliminate the gaps and overlaps. By working together through programming and design, the team strives to incorporate the best design elements and utilize the most cost-efficient construction methods. Having all parties use the design-build process, the scope of work becomes clearly delineated, eliminating the gaps and overlaps. In the end, the owner receives the full savings of this effort. A design-build approach really is the better way.