A Practitioner-Developed Framework for Mitigating Risk in Residential Construction through Industrial Contracting Principles

The American residential construction industry suffers from inefficiencies in the way contractors are hired for each project. This technical note presents an innovative, integrated framework for project delivery that addresses these issues. The framework has three main parts that the author took from best practices in large-scale international industrial construction: (1) long-term framework contracts with pre-qualified contractors to make sure resources stay stable; (2) a systematized, multi-stage process for vetting contractors and checking their performance on an ongoing basis; and (3) the need to integrate digital project management platforms. This work delineates a novel methodology, illustrates its practical application and scalability informed by preliminary insights from the American market, and proposes a strategic framework for mitigating risk and improving predictability within the residential sector.