Dr Khairuddin Abdul Rashid

DESIGN AND BUILD

PWD FORM DB/T (2002)

PROFESSOR DR. KHAIRUDDIN BIN ABDUL RASHID

Dip. QS., BSc. QS (UK)., MSc. Constn. Mgmt (UK).,
PhD. Constn. Procurement (UK).,
MIS (M)., Regd. QS (BQSM)

Revision Nov. 03
Revision Feb.04
Revision Oct. 04
© Dr Khairuddin Bin Abdul Rashid

1
Dr Khairuddin Abdul Rashid

The Speaker

Professor - IIUM

Past Positions

Assoc. Professor - IIUM

Program Director IIUM-CIDB MBA (CB)

Deputy Dean, KAED, IIUM

Head, QS Dept, KAED, IIUM

Senior Assistant Director – JKR

Researcher & Lecturer - Nottingham Trent
University UK

Senior Manager - CIDB

Senior Quantity Surveyor - JKR

Quantity Surveyor - JKR

Trainee Quantity Surveyor - London

Assist. Quantity Surveyor - KL

Published and presented papers in

Malaysia, UK, China, Australia, USA,
Japan, Brunei, Canada

2
Dr Khairuddin Abdul Rashid

Agenda

Session 1 Introduction
D/B Turnkey system
9 – 9.30am

Session 2 Form DB/T 2002

Clause 1 – 15
9.30am – 10.30am

Session 3 Clause 16 – 30
11.00 – 12.00pm

3
Dr Khairuddin Abdul Rashid

Agenda

Session 4 Clause 31 – 45
12.00 – 1.00pm

Session 5 Clause 46 – 62
2.00 – 3.15pm

Session 6 Conclusion
Q&A
3.45 – 4.20pm

4
Dr Khairuddin Abdul Rashid

About the seminar

Based on the speaker’s

training, knowledge and
experience
Its an overview:
 Focuses on salient points of
each clause of Form DB/T
2002, provides commentary
and basis for discussions
 Non legal in interpretation
 To enhance understanding
 For mutual benefits

5
Dr Khairuddin Abdul Rashid

Some considerations please...

Off / Vibration mode,

be discreet...

Too fast…
Too slow…
Don’t follow...
Let me know

Any questions?
Just ask...

Bored… stay focus!!

© Dr Khairuddin

6
Dr Khairuddin Abdul Rashid

Session 1
Introduction to
Design and Build
Or Turnkey

7
Dr Khairuddin Abdul Rashid

Project Delivery Systems

 The 2 continuums

DBB
Mgmt contracting
Owner

Designers M. Contractor

Construction mgmt

DB
Owner

D&B Entity
Designers Contractors

8
Dr Khairuddin Abdul Rashid

Design and build:

Historical background

 Not a new system

- in the olden days a client
approached a merchant. The
latter offered a complete
package of design, construction
and commissioning

Client - initiate

Merchant - design,
procure materials,
construct, complete

9
Dr Khairuddin Abdul Rashid

Design and build:

Historical background

 Specialization - architects,
engineers, quantity surveyors
led to the traditional system

Client
Architect QS

Engineers Others

design SO
bid

Contractor
build

Subcontractors

10
Dr Khairuddin Abdul Rashid

Design and build:

Historical background

 Design and build emerged

when clients look for new and
better ways to reduce
development period and to
avoid conflicts commonly
found under the traditional
system

Client Initiate

design

Time saving
Construct
Design and build
contractor

11
Dr Khairuddin Abdul Rashid

Design and build:

Historical background

 Design and build is a form of

fast-track …
(construction can start before
detailed design completed)

 In Malaysia, design and build

was pushed by the PM

 Started in 1983 by JKR

12
Dr Khairuddin Abdul Rashid

Design and Build or Turnkey

Key characteristics
 Over-laps design and
construction

 Contractor responsible for

design and construction

 Design performed by the

contractor or by designers
employed by the contractor

13
Dr Khairuddin Abdul Rashid

Design and Build or

Turnkey
Client

Design and Build Contractor

Suppliers

Sub-contractors

Figure 3a: Contractual Relationship under the Design and Build System

Sequence

brief tender design

construction

Figure 3b: Sequence of operations

Table 3 – Distribution of risk under the design and build or turnkey

procurement system in Malaysia
Risk Client Funder Designer Contractor
Time √
Price √
Schematic design √
Detailed design √
Specialist design √
Project finance √
Effectiveness of projects in operation √ √
Quality √

14
Dr Khairuddin Abdul Rashid

Design and Build or

Turnkey

 Advantages
o Single point responsibility?
o Price fixed in advance
o Shorter development period
o Buildability (possible?)

 Disadvantages
o Project cost higher?
o Lacks aesthetic values?
o Not accommodative to
changes?

15
Dr Khairuddin Abdul Rashid

Options within design and build

Turnkey

Package deal

Design and build

(competition)

Design and build

(negotiated)

Develop and
construct

Client involvement

Contractor involvement

16
Dr Khairuddin Abdul Rashid

Trends in Procurement

 The traditional system was the

preferred system prior to the
mid 1980’s

 Design and build became

popular in the mid 1980’s

 Design and build is

increasingly used in the
Malaysian public sector

17
Dr Khairuddin Abdul Rashid

Trends in Procurement

 Malaysia (Khairuddin, Notts, 1998)

DBB – drwgs & specs – medium
DBB – firm BQs – high
DBB – approx. BQs – medium
D & B – low
Cost plus – low
Mgmt contracting – low
Constr. Mgmt - low

 Malaysia (Suraya, UM, 1999)

DBB – 71%
D & B – 21%
Constr. Mgmt – 8%

18
Dr Khairuddin Abdul Rashid

TENDERS CALLED
(JKR HQ)

Year No Value D/B Value D/B

1995 465 1,557m 3 617m

1996 287 797 m 3 48 m

1997 322 904 m 6 88 m

1998 255 718 m 2 45 m

1999 430 1,242m 12 132 m

19
Dr Khairuddin Abdul Rashid

Trends in Procurement

 UK – the use of D/B increased

from a 10% market share in the
1980s to a 35% share in the 1990s
(RICS 2000)

 US – D/B is the fastest growing

method. April 1995 – April 1996,
no of D/B projects increased by
103% over previous year. In terms
of value, from USA$212 billion,
USA37.2 billion (18%) procured
through D/B (D/B Institute of
USA, at:www.constructionbook.com)

20
Dr Khairuddin Abdul Rashid

Selection of most
appropriate system

 Should meet the client’s

needs, type of project and the
nature and extend of risks that
the client is able to take
 Should be appropriate in
terms of available expertise
and resources
 Should be based on 3 key
criteria:
 Time
 Cost
 Performance

21
Dr Khairuddin Abdul Rashid

Good practice

 Clients must be made aware

of the choices available

 There is no one system that is

suitable for all projects

 The key objective is to ensure

the client’s objectives in terms
of time, cost and performance
are met effectively, efficiently
and economically.

22
Dr Khairuddin Abdul Rashid

Design and build: Issues

1. Risk - contractor assumes all

design and construction risk,
in return client loses some
control over the project

2. Variation - the system is not

adaptive to variations and
variations are generally more
expensive than the traditional
system

3. Novation - where employment

of consultants employed by
the client is transferred to the
contractor

23
Dr Khairuddin Abdul Rashid

Design and build: Issues

4. Supervision - the contractor is

supposed to provide all
superintendence but this is
seldom achieved…

Conflicts when client employs

representative on site …
single point responsibility?

5. Direct payment to consultants

- 2 paradoxes
 It may allow clients to
monitor the performance of
the consultant, but
 It may cause difficulties to the
contractor

24
Dr Khairuddin Abdul Rashid

Design and build: Issues

6. Relatively fewer D/B

contractors - so less real
competition in terms of price
and level of services

7. Evaluation of bids - difficult

since each design, cost and
work’s programme will vary
(comparing a BMW & a
Merc?)

25
Dr Khairuddin Abdul Rashid

Design and build: What

clients want

1. Single point responsibility

2. A guaranteed maximum price

3. Avoid design and construction

risks

But in implementation

4. Price certainty and high

quality is not easy to achieve

5. Maintenance not given much

attention

26
Dr Khairuddin Abdul Rashid

Options preferred by
Malaysia

 Clients prefer to appoint

consultants to develop
preliminary designs. The
appointed contractor develops
the detailed and specialist
designs

 Contractor employs
consultants to assist in the
detailed and specialist design

 The negotiated design and

build appears to be gaining
popularity in the public sector

27
Dr Khairuddin Abdul Rashid

End of Session 1

28