Organizational Alternatives for Large Projects

Organizing large construction projects can be as confusing and challenging as managing them. Many organizational variations are possible. This paper describes five major organizational alternatives and reviews the advantages and disadvantages of each. The alternatives include: (1) Strong functional organization; (2) functional organization with area coordination; (3) functional organization wth area management; (4) area management with craft discipline staff; and (5) autonomous area organization. This paper also proposes a method for selecting a project organization that involves developing organizational criteria and using these criteria in an evaluation matrix. Such a process could aid managers in meeting the challenge of effective project organization.     

AHP-Based Equipment Selection Model for Construction Projects

Selection of equipment for construction projects, a key factor in the success of the project, is a complex process. Current models offered by the literature fail to provide adequate solutions for two major issues: the systematic evaluation of soft factors, and the weighting of soft benefits in comparison with costs. This paper presents a selection model based on analytic hierarchy process (AHP), a multiattribute decision analysis method, with a view to providing solutions for these two issues. The model has the capacity to handle a great number of different criteria in a way that truly reflects the complex reality, to incorporate the context and unique conditions of the project, and to allow for manifestation of user experience and subjective perception. The model was implemented in an in-house developed system that was improved and validated through testing by senior professionals. The main academic contribution of the study is in the modification of AHP to correspond with the nature of equipment selection and in its utilization as an effective means for the formalization of knowledge possessed by competent, experienced practitioners. On the practical side, the proposed model offers an efficient, convenient tool that forces the users into orderly, methodical thinking, guides them in making logical, consistent decisions, and provides a facility for all necessary computations.     

Considering Prework on Industrial Projects

Prefabrication, preassembly, modularization, and off-site fabrication, collectively termed as prework have become more viable with recent advances in design and information technologies. These construction methods offer a substantial opportunity to improve project performance when circumstances merit. Successful implementation of these methods on a particular project requires systematic analysis and early decision making based on specific factors of the project. This paper identifies those factors influencing decisions on the use of prework, and current industry practices for evaluating the applicability of prework on industrial projects. It then presents a decision framework to assist industry practitioners with evaluating the applicability of prework on their project, and describes a computerized tool to aid project teams in the decision-making process. The developed framework and tool are useful and effective in the decision-making process, and easy to use, as validated by practitioners in the industry.     

“Soft” Considerations in Equipment Selection for Building Construction Projects

This paper raises the issue of “soft” considerations in the selection of equipment for building construction projects. The paper aims at increasing the awareness: (1) to the nature, variety, and richness of soft factors; (2) to their significant role and potential impact on the outcome of decision making; and (3) to the inherent difficulty of evaluating them and integrating them within a comprehensive selection process. Existing state-of-the-art equipment selection models were analyzed and found to be inadequate in terms of both considering soft factors and providing mechanisms for their systematic evaluation. Six cases of large-size, complex construction projects were investigated to obtain an extensive list of typical soft factors. This investigation revealed that the consideration of soft factors in current practices is essentially unstructured and is not integrated within the selection process in a systematic manner. A desirable selection process is outlined that generally responds to the needs identified in the study. The proposition of a specific method for the quantitative treatment of soft factors and their tradeoff with cost factors is the subject of another paper.     

Systematic Evaluation of Construction Equipment Alternatives: Case Study

Selecting the right equipment for the project is inherently a multifaceted cost and benefit evaluation process that is further compounded by the complexity of today’s building projects and the lack of systematic tools for the consideration of soft factors. This paper presents a detailed application example of a model based on an analytical hierarchy process (AHP) approach. This model was developed to address the difficulties experienced during the multifaceted process. The example illustrates how an AHP-based model helps address the multitude of qualitative, intangible factors, both among the factors themselves and then vis-à-vis costs, by means of a systematic and traceable process. The method enables project managers and their equipment selection teams to exercise their knowledge, intuition, and professional judgment, and at the same time to address the context and specifics of the particular projects under examination. The example should be helpful for construction practitioners dealing with similar equipment selection issues. Researchers may find interest in the implementation of a multiattribute-decision-making method for a typical construction management problem.     

Study on Development Patterns of Infrastructure Projects

From case studies, it was found that the practices of infrastructure development can be abstracted into development patterns. Based on the findings, this paper first investigated possible task allocations between the public and private sectors to build a development decision tree of infrastructure projects, and then constructed a development pattern matrix with five valid development patterns, according to the time frame and fund sources of payment to private firms. The five development patterns were systematically studied and the findings showed that various procurement models can be derived through changing task allocation and the way to pay private firms. Some key procurement models derived from the five development patterns were illustrated by examples. Moreover, the procurement method of build-transfer-lend was devised to demonstrate that new procurement models can be derived from the development pattern matrix. Finally, a case study showed that the five basic development patterns can be combined to form mixed procurement models. The development decision tree and the development pattern matrix provide a thinking tool in the formulation of procurement strategies.     

Practical Multifactor Approach to Evaluating Risk of Investment in Engineering Projects

Risk analysis is crucial in enabling management to make informed decisions regarding the economic viability of engineering projects. In most building construction projects, sophisticated risk assessment methods are not used because the detailed input information they require is unavailable to the average project owner or manager. As a result, risk assessment is often limited to simple sensitivity analyses. This paper presents a practical yet thorough method in which the economic risk inherent in a construction project can be calculated with input information of varying levels of detail. The proposed “multifactor” method includes consideration of interdependence between a project’s risk factors. The principles of the method are explained, its application to a large construction project is illustrated, and the findings are discussed.     

Embodying Product and Process Flexibility to Cope with Challenging Project Deliveries

Four factors make it challenging to manage semiconductor fabrication facility (“fabs”) projects: technical complexity of the product design, need to compress the project duration, need to reduce upfront costs, and unexpected project changes. The strategies employed by practitioners to cope with these challenges form an intricate puzzle. We empirically develop a framework that provides a structure for helping to solve this puzzle, which comprises two principles: investing upfront in a flexible product design and structuring a flexible process. Empirical findings reveal that project teams make commitments early on by overdesigning but also postpone critical decisions by differentiating the scope of their work. Project teams employ other strategies such as increasing communication, using modular architectures, engaging in four-dimensional computer-based modeling, and fabricating components and subsystems off-site. Our analysis yields understanding on the purposes and performance tradeoffs of these strategies, and on how they embody the two principles. Project managers may find the framework useful when deciding which strategies best suit other equally challenging projects.     

Analytic Network Process Applied to Project Selection

Owing to the complexity of a construction project, the analytic network process (ANP) is helpful to deal with interdependent relationships within a multicriteria decision-making model. This paper demonstrates an example to illustrate how to empirically prioritize a set of projects by using a five-level project selection model. A questionnaire was filled by a group of construction professionals of a medium-sized local developer and scores were computed for prioritizing the potential projects. The paper is relevant to both industry practitioners and researchers. Industry practitioners may adopt the weighted criteria for direct project selection or apply the ANP method to prioritize their own set of selection criteria. Researchers may rely on this paper as a point of departure for exploring other uses of ANP.     

Bid Compensation Decision Model for Projects with Costly Bid Preparation

For projects with high bid preparation cost, it is often suggested that the owner should consider paying bid compensation to the most highly ranked unsuccessful bidders to stimulate extra effort or inputs in bid preparation. Whereas the underlying idea of using bid compensation is intuitively sound, there is no theoretical basis or empirical evidence for such suggestion. Because costly bid preparation often implies a larger project scale, the issue of bid compensation strategy is important to practitioners and an interest of study. This paper aims to study the impacts of bid compensation and to develop appropriate bid compensation strategies. Game theory is applied to analyze the behavioral dynamics between competing bidders and project owners. A bid compensation model based on game theoretic analysis is developed in this study. The model provides equilibrium solutions under bid compensation, quantitative formula, and qualitative implications for the formation of bid compensation strategies.     

Relative Effectiveness of Project Delivery and Contract Strategies

Project delivery systems define the roles and responsibilities of the parties involved in a project. They also establish an execution framework in terms of sequencing of design, procurement, and construction. The decision made in the selection of a project delivery system for a project impacts all phases of execution of the project and greatly impacts the efficiency of project execution. Such decisions should be facilitated by thorough analysis. Structured, quantitative decision analysis processes have been shown to have several benefits over the simplistic, holistic, and informal processes that typically characterize subjective evaluations. However, a dearth of quantitative values of project delivery systems established and validated through research has invariably left project managers with no alternative than to make project delivery selection decisions on the basis of subjective evaluations. Development of the needed quantitative values for application in a decision analysis process would greatly enhance the quality of the decision-making process and provide a defensible rationale for selection of project delivery systems for capital projects. This paper presents research findings that provide the needed quantitative values in this area. Based on the quantitative values defined here, interested parties can develop and implement quantitative evaluation of project delivery alternatives to identify the optimal solution for a given project. Multicriteria decision analysis was found to be the suitable approach for a quantitative, analytical evaluation of project delivery systems. Consequently, the quantitative values presented in this paper were developed in accordance with the requirements of the multicriteria decision analysis technique known as simple multiattribute rating technique with swing weights (SMARTS). Utilizing the quantitative values presented here and applying the analysis technique of SMARTS, a decision support tool has been developed and validated for the Construction Industry Institute. The decision support tool is presently being utilized by member companies of the Construction Industry Institute that were privy to its development. With the presentation of the quantitative values in this paper, other parties interested in developing similar tools would benefit from the research results presented here.     

Impact of Stress on the Performance of Construction Project Managers

The work of construction project managers (CPMs) is often highly stressful, due to time pressures, and due to the uncertainties and the dynamic social structure involved in construction projects. This study aims to investigate the impact of stress on the performance of CPMs. Correlation analysis and structural equation modeling are employed to uncover the relationships between different types of stress (i.e., objective stress, burnout, and physiological stress) and the work performances (i.e., task performance, interpersonal performance, and organizational performance) of CPMs. Data were collected from 108 CPMs who work in a variety of construction sectors, including prime contractors, subcontractors, developers, consultant firms, and the public sector. Results showed that (1) objective stress reduces the task performance of CPMs while burnout can have a positive effect on it; (2) interpersonal performance is maximized with a moderate level of objective stress (i.e., an inverted-U-shaped relationship between these two variables) and increases in line with the improvement of the task performance of individuals; and (3) organizational performance has U-shaped relationships with both burnout and physiological stresses and is worsened by objective stress. Last, it is suggested to stakeholders that regular reviews of job allocation, stress appraisals, stress management workshops, group or individual counseling, and psychological treatment or physiotherapy be carried out to optimize the stress and the performance of CPMs.     

Capturing Knowledge in Construction Projects: Knowledge Platform for Contractors

Managing knowledge effectively is critical to the survival and advance of a company, especially in project-based industries such as construction. However, capturing knowledge in construction projects is a tedious task, as knowledge is usually experience based, tacit, and hard to pass on to others. In this study, a survey was carried out among eight leading Turkish construction contractors that are operating within the international construction market. The specific objectives of this survey are to find out how the tacit and explicit knowledge are captured, stored, shared, and used in forthcoming projects, as well as major drivers and barriers for knowledge management. Based on the survey, it was determined that most of these firms do not have a knowledge management strategy and a systematic way of capturing and storing tacit knowledge. A conceptual framework is proposed to formalize the knowledge-capturing process within construction companies. To demonstrate how the conceptual framework can be implemented in practice, a Web-based system, namely, Knowledge Platform for Contractors (KPfC) is presented. It is hypothesized that KPfC can be used to manage both tacit and explicit knowledge effectively in construction projects.     

Application of Dependency Structure Matrix for Activity Sequencing in Concurrent Engineering Projects

The dependency structure matrix (DSM) has been identified as an apt tool to represent information flows between activities. Using this representation, information dependency attributes can be organized and analyzed in a structured manner to identify activity groups and sequences for concurrent execution. Current DSM methodology requires significant efforts from the experts to estimate information dependency attributes. The methodology can be more widely used if the estimating efforts are reduced. This paper proposes two concepts to reduce the estimating efforts required for the DSM methodology. The first concept reduces the number of information dependency ratings required and the second concept reduces the effort to estimate the rating. The proposed concepts are structured into a procedure. This procedure is applied to the design phase of an induced draft cooling tower (IDCT) project and discussed. The paper also discusses the shortcomings and future directions of the present approach and concludes that the present approach is applicable in IDCT projects and can be extended to other types of projects.     

Measuring Effectiveness of Materials Management for Industrial Projects

A measurement of the effectiveness of the material management process is needed in order to analyze problems, suggest solutions, and assess the impact of modifications to the process. Such measurement is also required for any benchmarking effort. Research was conducted to apply a set of key effectiveness measures on 17 ongoing industrial projects. This research showed that most of the measures were easily obtainable, but some were difficult to obtain. Research also showed that it was possible to obtain the highest score on all measures, indicating that best practice in industry is achieving highly successful results. Most of the projects appeared to have a highly effective materials management process, as indicated by the fact that median values of these measures were much closer to the best values than those of the mean values. A utilization plan for the measurement of the effectiveness of the material management process is presented.     

Reliability Buffering for Construction Projects

Buffering is a common practice in project planning. Project managers or schedulers have used a time contingency to guarantee the completion time of either an activity or a project. This traditional buffering, however, often fails to protect the project schedule performance, resulting in an unnecessary resource idle time. To deal with this problem, reliability buffering, a simulation-based buffering strategy, is presented. Reliability buffering aims to generate a robust construction plan that protects against uncertainties by reducing the potential impact of construction changes. The effectiveness of reliability buffering is examined by simulating a dynamic project model that integrates the simulation approach with the network scheduling approach. The research results indicate that reliability buffering can help achieve a shorter project duration without driving up costs by pooling, resizing, relocating, and recharacterizing contingency buffers. A case study of bridge construction projects also demonstrates how construction projects can benefit from reliability buffering in real world settings. Although further validation is needed, reliability buffering can potentially impact the planning and control of construction projects by improving the consideration of construction feedbacks and characteristics in buffering, and serving as an input to a dynamic project model.     

Contractor’s Risk Attitudes in the Selection of International Construction Projects

International construction involves all of the uncertainties common to domestic construction projects as well as risks specific to international transactions. Consequently, despite the worldwide trend toward globalization, a very small portion of contractors actively seek international contracts due to concerns of probable failures. This paper describes findings from experiments done to investigate the risk attitude and bid decision behavior in the selection of international projects. The participants demonstrated either weak risk seeking in profit situations or strong risk seeking toward loss situations when choosing between conflicting options of risky opportunities and sure payoffs. On the other hand, another experimental test attempting to investigate bid behavior when making a realistic bid or no-bid decision in a complicated international construction project reveals the prevailing risk aversion. Further, this paper finds the experimental supports for some of the errors and biases due to risk attitude that commonly exist in bid decisions in this area. Finally, we present lessons learned and guidelines to make a qualified bid decision through feedback with the participants.     

Framework for Measuring the Rationale Clarity of AEC Design Decisions

Current architecture, engineering, and construction (AEC) design processes often rely on precedent to resolve complex decisions. However, changes to stakeholder concerns, design methods, and building products devalue much of this precedent knowledge. Project teams need to clearly communicate their decision rationale to develop consensus about design decisions. This study reviews a broad range of relevant theory from decision-based design, decision analysis, decision theory, linguistics, logic, organization theory, and social welfare. Rationale is defined as a set of assertions regarding distinct components (i.e., managers, stakeholders, designers, gatekeepers, goals, constraints, alternatives, and analysis) that support design decisions. Conditions of clarity (i.e., coherent, concrete, connected, consistent, credible, certain, and correct) are also defined. These definitions are used to measure the clarity of assertions, components, and the rationale as a whole. Taken together, this rationale clarity framework (RCF) provides a structured view that enables an objective evaluation of design decision methods.     

Nondominated Archiving Multicolony Ant Algorithm in Time–Cost Trade-Off Optimization

Time–cost trade-off analysis is addressed as an important aspect of any construction project planning and control. Nonexistence of a unique solution makes the time–cost trade-off problems very difficult to tackle. As a combinatorial optimization problem one may apply heuristics or mathematical programming techniques to solve time–cost trade-off problems. In this paper, a new multicolony ant algorithm is developed and used to solve the time–cost multiobjective optimization problem. Pareto archiving together with innovative solution exchange strategy are introduced which are highly efficient in developing the Pareto front and set of nondominated solutions in a time–cost optimization problem. An 18-activity time–cost problem is used to evaluate the performance of the proposed algorithm. Results show that the proposed algorithm outperforms the well-known weighted method to develop the nondominated solutions in a combinatorial optimization problem. The paper is more relevant to researchers who are interested in developing new quantitative methods and/or algorithms for managing construction projects.