Performance Based Design: Why Aren’t We Leveraging It to Its Full Potential? Managing Opportunity, Safety, and Contract Risk-Paper

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The paper argues that geotechnical projects underuse the Observational Method: designing for likely ground conditions, monitoring actual performance during construction, and adjusting the design when predefined thresholds are reached. Although subsurface conditions are uncertain, prescriptive “conservative” designs do not automatically ensure safety. They can increase material, labor, cost, and schedule, while creating false confidence and reducing attention to monitoring and construction limits.<br /><br />Case histories from the Greater Toronto Area show that performance-based designs achieved comparable or better movement control with substantially less bracing. Examples include estimated savings of CAD $1 million at Governor’s Hill, a 50% reduction in tiebacks at Vincent Condominiums, and shoring at Cedarvale Station costing nearly 90% less than a prescriptively designed alternative despite similar measured performance. The cases also illustrate that benefits depend on reliable monitoring, timely interpretation, and contingency actions prepared in advance.<br /><br />The authors identify contract structures as a major barrier: conventional procurement often places risk unevenly, discouraging contractors and designers from sharing innovations. They recommend collaborative approaches that establish a geotechnical baseline, base and contingency designs, measurable performance indicators, and clear triggers and response plans before construction. Depending on project complexity, these can be incorporated through trigger clauses, open-book pricing, target-price agreements, progressive design-build, or alliance contracts. Contingency costs and savings should be shared fairly, and designers should be compensated for the value of their expertise while being protected from risks outside their control.<br /><br />Successful implementation requires trust, early stakeholder involvement, strong design verification, and clear incentives for owners, contractors, subcontractors, and designers. Properly planned and monitored, the Observational Method can improve safety while delivering more efficient, constructible, and cost-effective designs.

Keywords

Observational Method

geotechnical engineering

performance-based design

ground conditions

construction monitoring

subsurface uncertainty

shoring design

tiebacks

contracting strategies

risk sharing