By: Derek McNamara, featured in Data Center Dynamics, April 2025
As demand for data centers has surged, so, inevitably, have challenges around delivery. Lead times for some essential equipment have doubled since 2022, and costly delays caused by legal disputes with contractors have risen sharply. It doesn’t help that traditional procurement models push most of the risk onto suppliers, leading to bottlenecks and cost overruns.
But there is a solution, and one that can be deployed without having to compromise on the scale of ambition for data centers. Timely and cost-efficient project completion can be achieved using an approach called integrated project delivery (IPD).
Working together wins every time. A poll by McKinsey of more than 100 businesses and organizations across multiple sectors revealed that those companies that regularly collaborated with suppliers could demonstrate higher growth, lower operating costs, and greater profitability than their industry peers.
What is it
IPD’s big advantage is in bringing together project stakeholders, including suppliers, contractors, and developers, early in the proceedings to improve planning. This collaborative approach shifts a project from being a potentially adversarial situation to one of shared risk and reward, creating stability among project parties. It can also encourage long-term supplier agreements, reduce lead times, and, crucially, lower cost volatility.
For this to manifest itself across data center delivery, developers must lead the process by putting in place more cooperative contracts as part of an IPD approach. The days of combative relations among stakeholders have to be a thing of the past.
Procurement attitudes also need to change. Buying teams should be measuring success based on final project cost certainty, not just upfront savings which can – and often do – fall by the wayside.
Using IPD allows for better supply chain visibility and lowers last-minute procurement delays. By helping to forge stronger supplier and contractor relationships, such collaboration creates more reliable, scalable supply chains.
Read the full article here.