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The design and construction industries have long sought techniques to reduce project delivery time, decrease cost, and increase efficiency. Building information modeling (BIM) offers the potential to achieve these goals. But will it? Although it is a technology, the opportunities and obstacles inherent in BIM are best understood if it is analyzed as a project delivery method. From this perspective, it is clear that our commercial, legal, and insurance models undermine BIM’s benefits and discourage its widespread adoption. Rethinking is clearly required.
The two most significant, unresolved issues are compensation and risk allocation. As
discussed later, with many projects neither the benefits nor the liabilities associated with BIM are equitably shared. Current contract models do not address these issues, and it’s not likely they will anytime soon. At present, engineers are either developing new approaches on a project-by-project basis, or they are accepting the misallocations as a cost of implementing the technology. These ad hoc strategies require excessive administrative efforts and will not necessarily lead to equitable compensation and risk models. Professional associations are beginning to study the structural issues created by BIM, but the effort is still in its infancy. As a result, engineers implementing BIM need to evaluate their long-range strategies for application, while simultaneously executing short-range strategies to manage current risks.BIM definition and benefits
For the purpose of this article, BIM is defined as a technology, or series of related technologies, that represents a structure three-dimensionally and parametrically. In addition to dimensional information, a BIM design contains embedded information concerning the functional characteristics of its elements. Depending on the system used, relationships can be created between elements that allow the software to manage interactions, and in some instances, messages passed between objects can allow the objects to respond to changes in the design. The resulting designs are multi-dimensional and "intelligent." In addition, BIM systems can integrate scheduling (4-D) and cost (5-D) information into the model. The principal software houses, such as Autodesk, Graphisoft, and others, are offering and developing BIM tools. Collaboration and visualization tools are available to integrate information from differing design platforms. International standards agencies, such as the International Alliance for Interoperability, assure that the tools can communicate seamlessly.
There are many benefits to using BIM. A key benefit is its use as a collaborative framework integrating the contributions of many participants. In contrast to the conventional hierarchical-information flow, a BIM process can and should benefit from the talents of engineers, owners, contractors, and suppliers. BIM processes also promote reliance on information embedded in the model. In an ideal sense, each participant can extract information it needs from the model, or from a series of interrelated models. In addition to design information, information useful for bidding and constructing the structure, and facilities management thereafter, can be obtained from the model. Joint use of common information reduces the cost of repetitious data creation and entry and also reduces the risk of error and inconsistency. The ability to reduce inconsistencies has an immediate effect on design quality. Modeling software can uncover the dimensional conflicts that plague complicated designs, such as process facilities, hospitals, and laboratories. BIM models can also be used to optimize energy usage, simulate operation of a structure or system, and generate drawings needed for fabrication. Some modeling software can even communicate directly with fabrication equipment.
Principal problems
The principal difficulty arising from BIM is directly related to its principal benefit. It is a collaborative tool in a non-collaborative world.
Our commercial and legal systems are built around well-defined limits of responsibility and liability. Not surprisingly, insurance products reflect these boundaries. Whether a person or organization is responsible for an error or loss will depend on whether it had a duty to prevent the occurrence and whether it had a relationship with the injured party sufficient to support liability. Our laws, case decisions, and contracts all seek to clarify these duties and to sharply draw boundaries between persons and between liability and non-liability.
But a collaborative framework blurs these distinctions. If many contribute to a problem, who is responsible? Moreover, if a participant can rely on the model, can’t it seek recompense from the creator if the model is flawed? Legal concepts that have long protected engineers, such as privity (the direct relationship between parties to a contract), the economic-loss doctrine (a party cannot be responsible in negligence for purely economic damages), and non-responsibility for bidding errors or the contractor’s means and methods, are undermined when the engineer knows that a contractor or subcontractor will be relying on BIM information. Although these are the most significant legal issues, there are other important issues; see "Unanswered questions," below.
As a general proposition, systems are most efficient when risks and rewards are balanced. But under current BIM practices, the engineer’s risks and rewards are often seriously imbalanced.
If an engineer implements BIM, it must invest in new software and hardware, train its employees to use the new systems, and may need to alter work flow to use the systems effectively. Operational costs are increased. Liability is also potentially increased because it will be difficult to determine where an engineer’s responsibility ends, more parties may be able to rely on BIM information and bring suit, and there may be liabilities arising from errors in the model or in translating information from the model. Unless compensation is increased, profitability, at least in the near term, must decrease. This gloomy calculus is at least partially offset by the increased business that a cutting-edge firm may obtain and the error reduction that comes from improved construction drawings due to conflict resolution. Nonetheless, if the use of BIM is economically advantageous, as most believe it is, then the engineers should have a greater share in the benefit to balance the increased risk and cost.
Solutions
Under current business models, engineers using BIM are being forced to curb collaboration to limit liability. Through contract documents or side agreements, BIM information is demoted to unofficial status that can’t be relied on by the receiving contractors, subcontractors, or vendors. The only official documents are the traditional paper deliverables. The entity receiving the data may also need to indemnify the engineer against its misuse and any improper redistribution.
Participants accessing the model may need to release the engineer from liability or limit the engineer’s liability for software, translation, or data errors. If the engineer is maintaining the model, its liability for information management should be similar to an information technology provider—no consequential damages allowed.
Each point of contact and information flow between participants must be carefully crafted to control or limit liability. Because the liability allocations rely on carefully drafted language, the engineer must rely on expert legal assistance. The engineer should also be assisted by the owner’s insurance broker and its own broker to assure that its scope of work is adequately covered and that the additional risk of BIM becomes a project cost. Project insurance should be considered, but may or may not be available at an acceptable price.
Although these remedies are currently necessary, they are incomplete in scope and effectiveness. For example, the ability to allocate risks between participants may depend on the jurisdiction where the suit is brought and the theories asserted by the claimant. Indemnification, liability limitation, and liability waiver rules differ from state to state, and differ radically when crossing national borders. Moreover, risk allocation tools are often imprecise, operating in an all-or-nothing fashion. Even if well drafted, these risk allocations measures are more band-aid than panacea. Poorly drafted, they may be no help at all.
Limiting reliance also undermines the utility of the building information model. If contractors and vendors can’t rely on the information, then they either need to check it thoroughly or accept the risk that it may be wrong. In either event, a rational contractor or vendor will increase its price to reflect this risk and extra work.
Thus, ad hoc liability limitations do not adequately balance risk and lessen the value of the BIM process. Other solutions are needed.
Longer-term strategies
The benefit/risk allocation issues can be avoided or minimized by reducing the number of entities. A design-build project, for example, avoids the issues of who benefits, who is responsible, and who can rely because there is only one entity. It is not surprising that large design-builders are early adopters of BIM technology.
This same strategy can be applied by creating a single-purpose entity. Under this model, the participants are shareholders in a single entity that designs, builds, and perhaps owns the structure. After the project has been successfully completed, it can be transferred to one of the participants or another party. Risk and reward can be allocated through the shared ownership of the common entity. However, creating a single-purpose entity creates additional administrative cost and overhead, and must be carefully crafted to minimize tax or other side effects.
In Australia and Britain, some public projects have been executed under an alliance model. Under this approach, the parties agree to waive or limit liability among themselves and to share the rewards of a successful project and the risk of failure in pre-negotiated proportions. But modeling the outcomes of success and failure can be daunting and not applicable to every project.
Instead of focusing on risk and reward, another approach would define the economic benefits of BIM and adjusting compensation to give each party a portion of the efficiency gains. As hard data is developed regarding BIM benefits, this strategy may become increasingly useful.
Conclusion
Building information modeling will be an increasing force in the design professions. It can greatly increase efficiency and effectiveness. It can lessen risk by reducing inconsistency and error. But engineers embracing the technology must be aware that our commercial and legal models conflict with BIM’s collaborative core, and must skillfully negotiate agreements that equitably allocate risk and reward. And our legal and commercial practices must evolve to match the technology. Engineers must study the implications of the new technologies and should participate with their professional associations to develop sound project delivery methods that support, not undermine, building information modeling.
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Unanswered questions
Many important issues must be discussed and resolved if building information modeling is going to become common practice in the AEC profession. Although this list is only illustrative, it hints at the scope and complexity of BIM issues.
• If the model reflects the collaborative efforts of engineers, contractors, owners, and suppliers, who is in responsible charge under engineering licensing regulations?
• Who is in responsible charge if the model is capable of adjusting itself to accommodate new conditions? For example, some steel structural models can change members and connection details to reflect changes in bay size or column layout. Isn’t this structural engineering? And how do you stamp the model?
• If the model contains a programming error, who will be responsible? Engineers traditionally are responsible for designing within the standard of care, but software vendors traditionally limit any liability for losses caused by their products. Who will be responsible for the difference?
• Who is responsible for maintaining the model, archiving it correctly (and at appropriate intervals)? How should the model be archived given the transitory nature of technology?
• Who owns the model? Who owns the intellectual property contained in the model, and how can it be protected in a highly collaborative environment?
