Choi, K (2008) A new decision-support model for innovative contracting strategies through a quantitative analysis on aspects of project performance. PhD thesis, University of California, Berkeley, USA.
Abstract
Incentive/disincentive (I/D) and cost-plus-time (A+B) are the most widely used alternative contracting strategies for responding to the dual challenge of repairing aging infrastructure systems while minimizing traffic inconvenience to the traveling public. However, little is known about their impact on project performance aspects such as project schedule and cost. The lack of both systematic studies on these strategies and the proper analytical tools to assess them now prevents state highway agencies from budgeting accurately and realistically when they are considered for implementation. This study attempts to address these shortcomings by determining the effectiveness of these strategies and by developing a new decision-support model to promote their effective application. A quantitative analysis drawing on 1,372 infrastructure improvement projects completed in California from 2000 to 2008 was conducted. The results of one-way ANOVA analyses show that I/D projects held a decisive schedule-saving advantage over the A+B and conventional projects, but that I/D increased project costs significantly more than the others because of a higher frequency of contract change orders. The results also revealed an effectiveness problem with use of A+B. When compared with conventional projects, A+B not only included extreme schedule overruns, but it also increased project costs far above the levels seen in conventional projects; both of these resulted from inaccuracies created by allowing contractors to bid on contract time. According to the analysis, the additional cost of using I/D was recouped by reduced construction time, but this tradeoff was not seen in A+B projects. The quantitative analysis provides the basis for a new decision-support model's conceptual and theoretical analysis framework to help decision-makers determine realistic incentive amounts between a contractor's additional cost growth (lower bound) and a portion of the decrease in total time savings (upper bound). To quantify the lower and upper bounds, the model employs an integrated schedule/total time savings/cost growth analysis for expediting construction and it produces two types of incentives along with the maximum incentive amount, such as closure I/Ds and daily I/Ds. The content of this study can better inform decision-makers when they select among contracting strategies for a given project and help determine the most realistic incentive amounts.
| Item Type: | Thesis (Doctoral) |
|---|---|
| Thesis advisor: | Monismith, C L |
| Uncontrolled Keywords: | highway; traffic; budgeting; change order; project cost; project performance; quantitative analysis |
| Index terms: | quantitative analysis, agency, upper bound, drawing, strategy, improvement project, project cost, budgeting, tradeoff, implementation, cost-plus, construction time, effectiveness, time saving, project performance, change order, schedule overrun |
| Subjects: | financial management, management, performance management, economics, production management, contractual condition, probability and distributions, project management theory and practice, project controls, decision analysis, sociology, time analysis, technical documentation, contractual arrangements, data analysis and analytics |
| Topics: | Design Practice, Time Control, Contract Administration, Cost Management, Business Strategy, Research Practice, Quality Management, Project Management, Risk Management, Procurement |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here