Managing risks in IPD-ish projects: experience from Hong Kong

Abstract

PurposeIntegrated project delivery (IPD) project that does not use multiparty agreement is identified as IPD-ish. The use of IPD-ish arrangement by incorporating integration practices in conventional contract can be viewed as the part of the adoption process of IPD. Moreover, inappropriate integration practices invite new forms of risks and the absence of multiparty agreement adds to the challenges of risk management in IPD-ish projects. This study discusses such challenges and proposes the use of joint risk management to address the potential pitfalls in IPD-ish arrangement.Design/methodology/approachA mixed research method was applied. First, the criticality of IPD-ish general and integration-specific risks was examined through a survey. Second, a real IPD-ish project was used to exemplify the use of joint risk management (JRM) to manage IPD-ish risks.FindingsTwo types of risks, namely integration risks (IRs) and general risks (GRs), are identified in IPD-ish projects. Two major findings for the IRs: (1) the most critical IRs are related to unbalanced incentivization and inefficient multidisciplinary teams; and (2) only team formation related pre-contract JRM strategies affect IRs. As for the GRs, the most critical ones are associated with design issues and can be effectively mitigated by post-contract JRM.Originality/valueUsing IPD-ish arrangement is an inevitable part of implementation of full IPD. This happens as many change-averse owners would like to test the integration principles using a conventional contract that they are familiar with. In fact, success in IPD-ish would pave the path for further adoption of IPD. This study offers insight into categorization of risks in IPD-ish projects. Appropriate use of post-contract and organization related pre-contract JRM would improve the chance of teasing out the values of IPD through IPD-ish arrangements. Care should be taken to introduce some contracting integration initiatives, such as risk/reward sharing incentive.