Transformation From Design-Bid-Build to Design-Build Contracts in Road Construction

Abstract

This article was triggered by a public client opting to change contracting strategy on a pre-designed 4-lane motorway project from design-bid-build to design-build contract.The goal for the client is to build roads cheaper and faster with the greatest possible economic benefits for society.In the article, we ask: Which changes associated with the transition from a design-bidbuild to a design-build contract can be identified in the contractual relationship between the public developer, contractor and subcontractors?The article focuses on changes in relation to constructability, construction time and costs, and discusses the issues of quality and customer value.The study is theoretically related to the principal-agent theory and transaction cost theory, where the threat of opportunistic behaviour is central.This is also seen through the lens of the Lean Construction triangle, which focuses on the need for harmonisation between commercial element in the contract, organisation and production.We analyse the case in relation to three propositions:  Design-build offers incentives that result in better constructability than designbid-build contracts. Design-build results in lower production costs and faster construction than designbid-build contracts. Quality and customer value come under pressure in design-build contracts.The first proposition seems to be confirmed by the empirical analysis.Production cost is, however, not the same as the price for the client.It is more uncertainty related to the third proposition.An important finding is that the developer's change in strategy seems to