Most roles see at least some link between incentives and cost escalation

% who say current cost-based and billable-hour incentives have some or high correlation with excessive cost escalation (excluding “No opinion”)

Owners’ reps & program managers
90%
Cost consultants
89%
Designers
80%
Builders (GCs/CMs)
100%
Negotiated trade contractors
100%

Note: Values are based on respondents in each role who selected “Some correlation” or “High correlation,” excluding those who chose “No opinion” or left the item blank.

Source: State of Construction Survey (n = 12)

Builders and owners’ reps are seen as most enthusiastic about a rewired contract

% of respondents who say many in each role would embrace a value-aligned contracting approach enthusiastically (excluding “No opinion”)

0%25%50%75%100%
Owners’ reps &
program managers
50%
Designers
27%
Builders (GCs/CMs)
36%
Design-builders
27%

Note: “Many enthusiastically” reflects respondents who selected “Many (enthusiastically)” for each role, excluding “No opinion” and non-responses.

Source: State of Construction Survey (n = 12)

Nearly everyone is willing to pilot, but far fewer expect many to be enthusiastic

Overall willingness vs. anticipated enthusiastic adoption of a rewired contracting approach, across owners’ reps, designers, builders, design-builders and trade contractors

Participants willing to pilot
Share expecting “many” to be enthusiastic
All roles combined 96% willing to pilot · 33% expect many to be enthusiastic

Note: “Willing to pilot” includes responses of “Some (reluctantly),” “Some (enthusiastically),” “Many (reluctantly)” or “Many (enthusiastically)” across owners’ reps, designers, builders, design-builders and trade contractors, excluding “None,” “No opinion” and non-responses. “Many enthusiastic” includes only “Many (enthusiastically).”

Source: State of Construction Survey (n = 12)

A value-based compensation framework is expected to boost IC and automation
% of respondents who say a data-derived, value-based compensation model would significantly influence the following

Industrialized construction (IC)

Designers, builders, and IC providers
92%
Owners’ representatives & program managers
67%

Automation in planning & preconstruction

All parties overall
100%
Owners’ representatives & program managers
50%
Source: State of Construction Survey (n = 12)
Broad willingness to pilot a rewired contract, with owners’ reps seen as most enthusiastic
% of respondents who say participants would be willing to pilot, and who would embrace it enthusiastically (“many” in each role)

Who many expect to embrace it enthusiastically (“many”) by role

Owners’ reps & program managers
50%
Designers
25%
Builders (GCs/CMs)
40%
Design-builders
25%
Source: State of Construction Survey (n = 12)
Most roles see a link between incentives and cost escalation
% selecting “some” or “high” correlation (excludes “No Opinion”)
Owners’ reps & program managers
90%
Cost consultants
88%
Designers
80%
Builders (GCs/CMs)
100%
Negotiated trade contractors
100%
Source: State of Construction Survey (n = 12)
Many recognize misaligned incentives, fewer expect their role to embrace change
% who see correlation vs. % expecting “many” in their role to be enthusiastic
Owners’ reps
Designers
Builders (GCs/CMs)
GAP
(see problem vs. expect enthusiasm)
Owners’ reps –40
Designers –55
Builders –60
Source: State of Construction Survey (n = 12)

Most roles see at least some link between incentives and cost escalation

% who say current cost-based and billable-hour incentives have some or high correlation with excessive cost escalation (excluding “No opinion”)

Owners’ reps &
program managers
90%
Cost consultants
88%
Designers
80%
Builders (GCs/CMs)
100%
Negotiated trade
contractors
100%

Note: Values are based on respondents in each role who selected “Some correlation” or “High correlation,” excluding those who chose “No opinion” or left the item blank.

Source: State of Construction Survey (n = 12)

A value-based compensation framework is expected to boost IC and automation

% of respondents who say a data-derived, value-based compensation model would significantly influence the following

Industrialized construction (IC)
Designers, builders, and IC providers
92%
Owners’ representatives & program managers
67%
Automation in planning & preconstruction
All parties overall
100%
Owners’ representatives & program managers
(at least moderate pressure)
50%

Note: Respondents were asked how a value-based compensation framework would affect adoption of industrialized construction and automation.

Source: State of Construction Survey (n = 12)

Broad willingness to pilot a rewired contract, with owners’ reps seen as most enthusiastic

% of respondents who say participants would be willing to pilot, and who would embrace it enthusiastically (“many” in each role)

Who many expect to embrace it enthusiastically (“many”) by role
Owners’ reps &
program managers
50%
Designers
25%
Builders (GCs/CMs)
40%
Design-builders
25%

Note: “Enthusiastically” refers to respondents who selected “Many (enthusiastically)” in each role as likely to embrace the new contracting approach.

Source: State of Construction Survey (n = 12)

Many recognize misaligned incentives, fewer expect their own role to embrace change

% seeing correlation between incentives & cost escalation vs. % expecting “many” in their role to be enthusiastic

Owners’ reps
& program managers
Designers
Builders (GCs/CMs)
GAP
(problem vs. enthusiasm)
Owners’ reps –40
Designers –55
Builders –60

Note: Dots represent % selecting “Some” or “High” correlation vs. % selecting “Many (enthusiastically)” for each role.

Source: State of Construction Survey (n = 12)

Gap between recognizing misaligned incentives and expecting enthusiasm

Difference between % seeing correlation and % expecting “many” to embrace a rewired contract

Owners’ reps &
program managers
–40
Designers
–55
Builders (GCs/CMs)
–60

Note: GAP values = correlation % minus “many enthusiastic” % for each role.

Source: State of Construction Survey (n = 12)

Many recognize misaligned incentives, fewer expect their own role to embrace change

% seeing correlation between incentives & cost escalation vs. % expecting “many” in their role to be enthusiastic

Owners’ reps
& program managers
Designers
Builders (GCs/CMs)
GAP
(problem vs. enthusiasm)
Owners’ reps –40
Designers –55
Builders –60

Note: Dots represent % selecting “Some” or “High” correlation vs. % selecting “Many (enthusiastically)” for each role.

Source: State of Construction Survey (n = 12)

Many recognize misaligned incentives, fewer expect their role to embrace change

% of respondents who see a correlation between incentives and cost escalation, and who say many in each role would embrace a rewired, value-aligned contract

See correlation with cost escalation
Expect “many” in this role to be enthusiastic
0% 25% 50% 75% 100%
Owners’ reps &
program managers
90
50
Designers
80
25
Builders (GCs/CMs)
100
40

Note: “See correlation” reflects respondents in each role who said current incentive structures are at least somewhat correlated with excessive cost escalation. “Enthusiastic” reflects respondents who said many in that role would embrace a rewired, value-aligned contracting approach. GAP values are simple percentage-point differences between the two.

Source: State of Construction Survey (n = 12)

Perceived willingness to adopt a rewired contracting approach

% of respondents who say each statement about piloting or enthusiastically adopting a value-aligned contracting model is true

Each dot represents the share of respondents who agree
0% 25% 50% 75% 100%
At least some in every role
would be willing to pilot
100
At least some design-builders
would be enthusiastic adopters
77
Many design-builders
would be enthusiastic adopters
44

Note: Values reflect respondents who said each statement is at least somewhat likely. Percentages are based on all survey respondents.

Source: State of Construction Survey (n = 12)

Strong willingness to pilot, with varying expectations of enthusiasm

% of respondents who say participants would pilot or enthusiastically adopt a rewired, value-aligned contracting approach

All roles – at least some
would be willing to pilot
100%
Design-builders – at least
some would be enthusiastic
77%
Design-builders – many
would be enthusiastic
44%

Note: “At least some” includes respondents who expect any level of adoption in that category; “many” reflects those who expect broad, enthusiastic uptake among design-builders.

Source: State of Construction Survey (n = 12)

Design-builder enthusiasm toward a rewired contracting approach

% of respondents who expect design-builders to be at least somewhat enthusiastic vs. many being enthusiastic adopters

Design-builders’ expected enthusiasm
77% expect at least some design-builders to be enthusiastic; within that, 44% believe many will be enthusiastic adopters.
“Many” enthusiastic (44%)
Additional “some” enthusiastic (33%)

Note: The darker segment shows the share who believe many design-builders would be enthusiastic adopters. The lighter segment represents additional respondents who expect at least some, but not many, to be enthusiastic.

Source: State of Construction Survey (n = 12)

Universal agreement on the importance of reducing non-value-added costs

% of respondents who say addressing overhead, support costs, waste, and related profit is important — and whether they believe the problem can be solved

Say the problem is important to solve
100%
Say the problem is unsolvable
17%
Say the problem can be solved
83%

Note: “Important” reflects respondents who agreed that non-value-added costs (overhead, support, waste, and related profit) represent a critical problem. “Unsolvable” reflects respondents who believe the issue cannot be meaningfully addressed; others believe improvement is possible.

Source: State of Construction Survey (n = 12)

Universal agreement on the importance of cutting non-value-added costs

100% of respondents say overhead, support costs, waste, and related profit are an important problem to solve. Within that group, views differ on whether the problem can be solved.

Non-value-added costs as a problem 100% say this issue is important
17% say unsolvable 83% say it can be solved
Believe the problem is unsolvable (17%)
Believe the problem can be solved (83%)

Note: All respondents agreed that non-value-added costs (overhead, support, waste, and related profit) represent an important problem. Among them, 17% believe the issue cannot be meaningfully addressed; 83% believe improvement is possible.

Source: State of Construction Survey (n = 12)