Michelle Salyer:                Welcome to Outside the Box with BRPH, where we discuss the most innovative, interesting, and outside-the-box solutions to some of the most exciting and challenging projects in the world of architecture, engineering, design, construction, and mission solutions.

You’ll hear directly from the problem-solvers at BRPH as we dive deep into the latest news, trends, and topics in aerospace, defense, manufacturing and industrial, commercial, education, entertainment and hospitality.

I’m your host, Michelle Salyer. And I’ll be your guide as we open the lid on these topics and more, and invite you for an insider’s look at one of the most successful, fastest-growing employee-owned AEC firms in the United States. Welcome to Outside the Box with BRPH.

It’s often said the secret to being successful in business is to find a need that’s not being met, and address that need. That’s how an architecture and engineering firm with a strong technical background decided to start constructing some of its own projects.

Under its integrated services model. BRPH now takes on the role of architect, engineer, and constructor for highly specialized, extremely technical projects. What are the pros and cons for the firm and more importantly for the clients?

Matt Tyler, president of BRPH Construction Services, and Cris Vigil, senior vice president of BRPH, are here to explain this shift in thinking: why it makes sense, and how it saves clients both time and money. Welcome, Matt and Cris.

Cris Vigil:                            Thank you.

Matt Tyler:                         Thank you, Michelle. It’s always a pleasure to talk about our business.

Michelle Salyer:                Thank you. Thank you. Well, let’s jump right in. So BRPH has provided construction administration throughout its 60-year history. But why get into the actual business of construction, of building projects? What was that need that you thought you could fill there?

Matt Tyler:                         Let me start by just saying we are, and we will always be, an engineering firm first. We are a design firm first that does construction, not the other way around.

As you said, we have been doing technical designs for our entire 60-year history, launch pads, payload processing facilities, clean rooms, et cetera. And we bring that highly technical expertise on how to design a project.

But over the last several years, we’ve seen a shift in the markets where the commercialization of these highly technical opportunities or projects that were predominantly publicly funded through the federal government previously, are now commercialized. And the demand is for faster, more value, speed to market, just a greater value for the overall client.

So by delivering both the design and the construction with our own forces, we can offer the client more value, faster results that results in even better lifecycle cost for them.

Michelle Salyer:                Okay.

Cris Vigil:                            And a big topic there is the public-sector funding has changed dramatically in the arena, where private funding becomes far more prevalent in those business markets. Through private funding, the way and the manner in which the funding is achieved, and the way it gets developed and how it gets executed, is more progressive. It’s not exactly like a government entity supplying a capital fund. It’s more development-driven procedures.

Matt Tyler:                         To say it more simply, commercialization has resulted in business people running these projects versus a federal or a government entity.

Cris Vigil:                            Truth. Yeah, real truth.

Michelle Salyer:                Ah, okay. Okay. Interesting. Let’s break that down a little bit more. What benefits does this approach offer as opposed to a design-build contract, where the firm like BRPH would partner with an outside construction organization?

Matt Tyler:                         Well, again, to be clear, we are a design firm first. So we do have construction partners out there. We’re in many markets. We’re in the education, we’re in the entertainment, we’re in the hospitality markets and other markets.

And when the opportunity that we’re faced with makes sense for us to partner with an outside general contractor, we will do that: if it’s the right thing for BRPH, it’s the right thing for the client, and it’s the right thing for the overall project. So we do do that. We have several key general contractor partners that we value those relationships significantly.

Now when you take a little bit of shift to these more technical projects where we can offer that greater value by bringing both the design and the construction, we’re going to take that path. That path allows us to provide the agility that these owners need as the projects evolve, as the projects change. And that agility provides a greater ability for us to deliver faster and more economical for the customers.

Michelle Salyer:                Let’s talk a little bit more about that agility or the efficiency that you’re alluding to. How exactly do those efficiencies and improvements come about through this process?

Cris Vigil:                            It’s really iterative. As an integrated company, integrating all of our design and construction together through design and through construction, there is a seamless means of integration. It becomes an iterative process.

So rather than wait for milestones to occur before junctures are made where the project progresses, it’s actually continuous flow of communication and work that goes through the design and construction. It’s totally iterative. That causes the timeline to actually truncate, it causes the management of the work to actually reduce. So the factors are, as Matt just explains, far more efficient.

Matt Tyler:                         We’re giving out some of our secret recipe, which we really want to be careful about.

Michelle Salyer:                Secret sauce.

Matt Tyler:                         It’s our secret sauce. But what we’ve essentially done is we’ve created a situation in which our pre-construction and our design teams have merged together. And that the pre-construction elements, that being early procurements, that being constructability means and methods and other things that are construction-driven, are inputs into the design rather than outputs of the design.

A traditional process: once the design is done, the contractor then starts looking at those things and how to maximize those things in a schedule. By building those in as inputs to the design, we’re able to truncate that schedule, as Cris mentioned. We’re able to provide greater value to the clients.

Cris Vigil:                            Right.

Michelle Salyer:                Makes sense.

Cris Vigil:                            That’s a big topic. The whole pre-construction integrated with design work is a whole ‘nother topic we can talk about in another podcast.

Michelle Salyer:                Okay.

Cris Vigil:                            Because we could spend an hour just discussing how that happens.

Michelle Salyer:                Oh, I’ll take you up on that. Sounds good.

Matt, you often talk about the art of the possible when it comes to this kind of collaboration. What exactly do you mean by that?

Matt Tyler:                         Frequent collaborations on possible trade-offs. How does that all take place? It’s collaboration between the design and pre-construction, the best value for the clients. It’s taking all those things into consideration. But I find it a little bit funny, though.

On very rare occasions, we do have a case where the constructors may say, “Why did you put something stupid in the design?”

And we may have the designer say, “You guys can’t make that change in the field.”

But what I found is when I force those folks, those two people, generally two people, to sit down at a table and discuss the issue at hand, within 10 minutes, they come to the same conclusion. They agree on the conclusion. So collaboration works when both parties are looking to find a consensus that is best for the project and for the client.

Michelle Salyer:                What are the benefits to a client in terms of risk when they sign on for this type of contract, versus a design-build or a design-bid-build?

Matt Tyler:                         Yeah, it’s actually a really good question. It’s at the heart of the whole business model and the industry as a whole. So traditionally it’s always been design-bid-build. For decades it’s been design-bid-build. And in that situation, the owner holds all of the risk. Okay? The owner holds the risk. And when there’s a design error or something unforeseen in the field, the contractor has entitlement to get some recovery from the owner.

Well, if it was a design error, the owner would turn back to the designer and say, “Hey, why was this done?” Well, the owner really doesn’t much opportunity to recover from the designer. So ultimately, the contractor is entitled to the change and the owner is responsible for it, and the owner obviously has to pay for it.

In a design-build contract, where there’s a designer and a contractor as a partner separately from an integrated services situation, the owner has shed most of the risk to the contractor.

Now, it’s interesting in that design-build started way back when, multiple decades ago under the premise that it was going to save the owner time. But the owners really found was they had a great ability to pass that risk of design errors onto the contractor.

And so what does this happen? There’s a design error on a project. The contractor turns to the owner and says, “Hey, we got a design problem.”

He says, “Well, that’s your problem. That’s your problem.”

And so then the contractor has to turn back to the designer and go, “What happened?”

And it’s the same lack of ability to recover from the designer that the contractor ultimately holds that risk. And what that ultimately results in is the potential for an adversarial relationship between the design-build contractor and the owner. And that never results in anything good.

Conversely, for our integrated services process that we’ve developed, BRPH holds all the risk. We hold the design risk and we hold the construction risk. And by managing that risk, we can provide the owners with that relief of the risk that they’re looking for, and we can manage the project accordingly. It really takes a partnership between us and the owner to make this happen, but it really works really well.

Michelle Salyer:                Yeah, sounds like a win-win.

Matt Tyler:                         The real benefits of this is that: it is the ability for the clients to feel like they shed the risk, and actually shed the risk, and our ability to bring that technical expertise to the construction to where we can solve problems in the field quickly. It gives us the ability to manage that risk. And therefore, if we’re working to manage the risk with the clients, we can deliver the project successfully.

Michelle Salyer:                Kind of keeping the problems in the family, so to speak,

Cris Vigil:                            In the family.

Matt Tyler:                         Keep from pointing fingers at each other is really the question.

Michelle Salyer:                So we’ve talked a little bit about cost savings, or that’s been implied. But let’s talk about schedule or time savings. Cris, you said that in this model, the schedule is truncated. Let’s talk a little bit more about that.

Cris Vigil:                            Well, the schedule becomes an integration, just like the integration of collaboration of things and thoughts and design. So now what could happen is that the construction efforts in the field, the shovels that go in the ground, can actually happen faster if in fact decisions are made more timely and more effective way up early in the design process.

So it’s very common for us in the integrated services that we’re building before we’re finished designing. And it can be done very easily, as long as the parameters and the designs are worked out with an integration of construction in mind.

Michelle Salyer:                Okay.

Matt Tyler:                         If we go back to the traditional way that these technical projects were publicly funded, it was very common for clients to expect a three to four, maybe five-year duration for say a 100-million-dollar project. It was just unfathomable that we could get a project at that magnitude and that complexity designed and built within a four- or five-year timeframe. I think we’ve proven that using this integrated services model, we can cut that by 30 or 40%. We can give them that same project much faster.

Michelle Salyer:                Wow. And they get to market much faster.

Cris Vigil:                            Which is critical in a privately funded program.

Michelle Salyer:                Competitive program.

Cris Vigil:                            Yeah, because that private funding, their biggest return on investment happens with time. So if they can truncate that time to get to their return on investment, then the whole program has viability.

Matt Tyler:                         To say it simply, we’re in the business of building launch pads for rockets. That owner is more interested in getting rockets up into space than it is the infrastructure we’re building. So the faster we can build the infrastructure for him, the faster he can get his rockets launching.

Michelle Salyer:                Going back to talking about client risk, it seems to me that this business model is just very much based on transparency, on communication between the firm and the client, and also within the firm. How does this differ from what other companies might be offering? What’s unique about BRPH here?

Matt Tyler:                         Well, other companies are offering various forms and whatnot, but you’d think more of them would be. The progressive contracting method, complete transparency, it really what provides a level of comfort to the clients. You want to talk, Cris, about progressive contracting a little bit?

Cris Vigil:                            We’ve introduced with our clientele a method which allows them to not have to go to a complete full-scale contract right from the beginning. We call them off-ramps, where through the contracting of the work, we really begin with the consulting services. Then we go into a design services, and then we’d move on through into construction or some advisory services before construction.

But what that allows the funding stream to be is far more minimal at the beginning, and step through the process of making the decisions all along the way to get to your true fund, which is somewhere further down the chain of the schedule line. The idea of that is really setting the table for the client being very interactive on how the program is developed.

Therefore, as Matt just mentioned, in the old days, like a federal contract, if a project landed four or five years out, is because they had to create some bridging document for a design builder to bridge against and put his risk on.

In this case, we’ve completely eliminated that. The bridging documents are a development of consultancy and design that eventually rolls into construction immediately thereafter. We eliminate all those costs that come from the owner, and time back from the owner in that whole progressive contracting scheme.

Matt Tyler:                         So it goes back to that issue of risk. By our process, we’ve eliminated the risk by us being involved very early through some consulting. Or maybe it’s a full design-build contract. It’s hard to say, we can react in any way. But we’ve eliminated that risk by us being able to do the technical stuff up front.

We’ve also eliminated the risk for the client by having these off-ramps, like Cris mentioned. That if anywhere during this process the project begins to get off track, or get to where it’s unaffordable for him, he’s got off-ramps. He can go a different direction and we can part ways. And what we’ve given him to date is of value to him, even if the whole project doesn’t get finished.

Michelle Salyer:                Wow. We mentioned earlier that the BRPH team is fairly unique in its technical expertise. Why is that so important in terms of construction? And how are you maximizing that skill in these types of contracts?

Matt Tyler:                         Well, it’s pretty rare that you have the ability to have your highly technical resources actually in the field during the construction. That’s what we can bring, and that really is a differentiating factor for us.

We’re having the design engineers or project engineers in the field all the time. And we have access to have the designers that actually designed whatever it is that’s being installed in the field, at that moment that it’s being installed, to solve any issues or any problems that might come up. Our architects and engineers, they follow the projects right to the field.

Michelle Salyer:                Wow, okay.

Cris Vigil:                            Oh, that’s perfect. I think that when a client sees that, we call it the client delight effect, because inevitably what it means is that they get the individual that they were working with in design, also the individual that they’re seeing in the field. And that keeps the consistency of the thought process of why we did what we did way early in the decision-making of design, why we’re doing it as we’re doing it in construction.

Michelle Salyer:                Okay. Okay. So the architects and engineers are following the project through to completion.

Cris Vigil:                            Right.

Michelle Salyer:                Gotcha. We’ve talked a lot about intangibles, I think, and this all sounds really great in theory. But can you give me some examples of a project or two that BRPH is actually constructing, and how this approach has benefited that particular client versus another method that they might’ve used?

Matt Tyler:                         Well, given the nature of most of our projects, there’s a level of confidentiality to them, and that we probably can’t get into the very specifics of projects. I will give you an example of a project that we’re getting near wrapping up here fairly quickly.

The client put out some criteria, put it out for competition. We competed for the project. And at the end of the day, all of the bids that they got in were significantly over what they considered to be affordable.

As Cris mentioned, they turned to us and with a consulting agreement said, “How can we possibly get this back into the bucket?”

And as we worked through that with them, iteratively and collaboratively, we were able to deliver this project in a design-build integrated services fashion, a pretty complex facility, significantly less than the bids that they had got in through their initial process. And they’re getting a facility that meets their needs and is affordable.

Cris Vigil:                            The key to that is, as Matt is referring to a project that’s technically design-challenging, that can happen anywhere in the world. And so our method of progress here is that we’re working with our staff to travel anywhere in the world. We literally have been all across the globe. And in doing so, there are all sorts of other complications that come into play, obviously when working internationally. But all of our clients have the same thought process.

What we want is trust. And what we want is that ability to the individuals that we’re working with, or subcontractors we’re working with, that we’re working through BRPH. And that relationship transfers across the globe. That’s particularly important when it comes to some of these very privatized, very, call them secretive-type projects. But it also applies here in the United States when they’re not secretive.

We do some manufacturing work that’s also very complex and very technically challenging-oriented. It forces us to travel around the country. And those are the people we hire. Those are the folks that we want, is that they like that business. And they like the old, call it 200-year-old theory of the designer, the builder, the contractor are all really one. And it doesn’t matter whether we have an engineer or an architect in the field, as long as the design is being relegated and placed in the field.

Matt Tyler:                         Yeah. We’re trying to create this master builder environment across our design teams and our construction teams, so everybody views themselves as the master builder.

Michelle Salyer:                Okay. I’ve heard it said before that the sun never sets on BRPH, because we have projects all over the world.

Cris Vigil:                            It’s true. It’s true.

Matt Tyler:                         Some of us don’t get as much sleep as others.

Michelle Salyer:                Yeah. Imagine it’s difficult going back and forth between all the time zones.

Okay. Well, this all sounds great, but in the spirit of transparency that we’ve mentioned, what are the drawbacks? What are the cons?

Matt Tyler:                         The biggest fear that clients express to us is that they feel like they’re not going to get best pricing out of the markets by losing the concept or the thought that, “Hey, I’m losing that competitive spirit doing this progressive contracting process.”

Cris Vigil:                            They’re two different trends.

Matt Tyler:                         It appears that, “Hey, if we don’t put something together and we don’t go out and get competitive pricing, that we may not be getting the best market out of it.”

Michelle Salyer:                Putting all of our eggs in one basket kind of thing.

Matt Tyler:                         Correct. Correct. But conversely, when we’ve gotten clients to go down this path, they’re right there involved with it. We get the best pricing out of the market on their behalf.

We have them a part of how we get the market excited about their opportunities, how we get the market to bid on our work, which is their work. And then we have them a part of that selection process to make sure we are getting the best value out of the market on their behalf.

So it’s a fear, and it’s a fear that I understand. Because for decades, centuries maybe, this idea that construction can be bought as a commodity has always been there. That we can put something out and the lowest guy will dive down to the bottom and give us the rock-bottom price.

Well, in highly technical facilities, that just isn’t the case anymore. It just isn’t the case. For the best value for that client, there has to be this stepped process, this progressive process that Cris talked about.

Cris Vigil:                            That’s exactly right. And all of our integrated services projects in the last several years, we’ve got a bunch of them. They’ve been increasing a lot over the years. They’re all 100% successful. We don’t have anything that was a struggle. We don’t have anything that was too much for the owner to handle.

There’s always complications, and Matt could say there’s always complications in construction. There’s always something that’s got to be worked out. But in this scenario, the owner feels a part of it. He feels he’s at the table and he’s not outside the room. And we have a transparency, we share all that information with him.

Michelle Salyer:                All right, well, thank you so much, Matt and Cris. This has been very informative, and I hope to see you again next time, when we talk about pre-construction. Okay.

Cris Vigil:                            Great. Thanks.

Michelle Salyer:                Thank you.

Matt Tyler:                         Thanks Michelle.

Michelle Salyer:                Thanks for joining us today for Outside the Box with BRPH. We hope you’ve enjoyed today’s episode as we explored some of the most innovative and challenging projects, and the most pressing issues and trends in the AEC world. Learn more about us at brph.com, email us at [email protected], and follow us on LinkedIn, Facebook, Instagram, and X.

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