Project Delivery and
Contract Strategy (PDCS)
Project Delivery
and
Contract Strategy
Research Team
Gary Vandiver
Solutia
CPl Conference 2001
Project Delivery and
Contract Strategy (PDCS)
Gary Vandiver
Solutia
CPl Conference 2001
PDCS Research Team
Stuart D. Anderson
Stanley F. Berger
G. Wayne Burchette
James R. Greene
Robert P. Kehoe
Larry Kruse
Ade Oyetunji
Tim Thury
Gary Vandiver
Paul Wicker
Texas A&M
3M
Eastman Chemical, Chairman
Abbott Labs
NASA
Murphy Company
Texas A&M
GSA
Solutia
GM
Past Members
Darrick D. Bowers
David Combs
Richard De Leon, Jr.
Jerry Kirk
John Phillips
Janice White
John Wrockloff
Texas A&M
John Gray
UT System
FPL
U.S. Steel, former Chairman
UT System
U.S. Air Force
Team Mission Statement
To produce a process to assist
in selecting a contract delivery
strategy to optimize owner's
project objectives.
PDCS
Within industry, no existing set of
delivery systems applicable to a
wide range of project types.
CII commissioned the PDCS Research
Team to:
- Identify a larger set of project delivery
systems and contract strategies.
- Develop a decision process and tool.
PDCS
The research team developed
a procedure and tool to assist
in selection of Project Delivery
and Contract Strategy.
PDCS Procedure
• Focuses on owner’s project
objectives.
• Focuses on project execution
environment.
• Incorporates quantitative
assessment of PDCS alternatives
in decision support tool.
Research
Research conducted with:
• CII members, non-members
• Owners and contractors
• Public agencies
• Industrial and general building
sectors
PDCS Definition
• Defines roles and responsibilities
of parties in a project.
• Defines how owner pays for
services.
• Establishes framework for
organization of project execution.
PDCS – Typical Representation
Traditional Design-Bid-Build delivery system, PDCS 01
Phase Sequence: Serial sequence of design and construction
(Procurement begins with construction)
Design
Procure
Construct
Bid
Project Team Relationships
Primary Contractual/Functional Relationships
Owner
Designer
Constructor
Compensation Approaches
Designer:
Firm Price
Constructor: Competitive Lump Sum
PDCS – Purpose
Develop a tool that will assist
owners in selecting a project
delivery method and contract
strategy for their projects, based
on their project objectives.
Objectives
• Develop PDCS alternatives and
selection factors for industry-wide
application.
• Develop procedure and analysis
tool to aid PDCS selection.
• Develop procedure to facilitate
owner’s objectives.
Characteristics
Identify and define:
• Set of common PDCS alternatives
currently used in industry
• Set of factors considered in
selection process
• Approach for assessing factors
leading to appropriate PDCS
Data Collection and Validation
Phase I – Questionnaire data
from 90 projects:
• Defined PDCS alternatives and
selection factors that are used in
practice.
• Evaluated decision analysis
approaches.
Data Collection and Validation
Phase II – Workshops involving
32 owner and contractor project
managers:
• Developed relative effectiveness
scores that are intrinsic to
spreadsheet analysis.
Data Collection and Validation
Phase III – Validation of the Tool:
• Identified 20 selection factors and
12 PDCS alternatives.
• Tested and validated on 12 projects
from research team member
companies.
Owners are using the tool to support
PDCS decisions on new projects.
Data Collection and Validation
• Result obtained was appropriate.
• Procedure and tool are
improvement over current
practices.
• Insight into selection of PDCS
provided.
PDCS Decision Support Tool
PROCESS FLOWCHART
Start
Review project
objectives and profile
Review list of
Selection Factors
Identify relevant factors.
Go to Analysis Worksheet.
Copy/paste factors
into PW Table in
Analysis Worksheet
Compute
Preference Weights
Copy/paste Effectiveness
Values into Aggregation
Table in Analysis WS
Review aggregate
scores.
Select top three.
No
Review Default
Compensation
Approaches
Refine
Compensation
Approaches
Default
Compensation
Approaches
Okay?
Yes
Make
Decision
End
• Review project objectives.
• Identify selection factors
(related to owner’s project
objectives).
• Assign preference rank and
preference weights to
selected factors to reflect
priority.
PDCS Decision Support Tool
(continued)
PROCESS FLOWCHART
Start
Review project
objectives and profile
Review list of
Selection Factors
Identify relevant factors.
Go to Analysis Worksheet.
Copy/paste factors
into PW Table in
Analysis Worksheet
• Paste effectiveness values into
aggregate table.
• Obtain aggregate scores from
spreadsheet.
Compute
Preference Weights
Copy/paste Effectiveness
Values into Aggregation
Table in Analysis WS
Review aggregate
scores.
Select top three.
No
Review Default
Compensation
Approaches
Refine
Compensation
Approaches
Default
Compensation
Approaches
Okay?
Yes
Make
Decision
End
• Review results to make final
decision.
• Choose from 20 selection
factors, 12 PDCS alternatives.
PDCS Decision Support Tool
Factor
Number
Selection
Factor
Factor Description
for Comparing
Factor Action
Statement
1
Completion within
original budget is
critical to project
success
Delivery system
facilitates control of
cost growth
Control cost growth
7
Early completion is
critical to project
success
Delivery system
ensures shortest
reasonable schedule
Ensure shortest
schedule
17
Project features are
well defined at the
award of the design
and/or construction
contract
construction
Delivery system
capitalizes on well
defined project
scope prior to award
of design and/or
Capitalize on
well defined scope
PDCS Decision Support Tool
Table A-1: Compute Preference Weights
Factor Action Statement
Preference
Rank
Preference
Scores
Normalized
Preference
Weight
Control time growth
1
100
0.33
Protect confidentiality
2
80
0.27
Capitalize on familiar
project conditions
3
60
0.20
Maximize owner's involvement
4
40
0.13
Efficiently coordinate project
complexity or innovation
5
20
0.07
300
PDCS Decision Support Tool
Table A-2: Compute Aggregate Scores
Control time
growth
Protect
confidentiality
Capitalize on
familiar
project
conditions
Maximize
owner's
involvement
Coordinate
project
complexity or
innovation
EMPTY
0.33
0.27
0.20
0.13
0.07
0.00
PDCS 01
20
90
0
80
70
46.00
PDCS 02
50
90
50
90
60
66.67
PDCS 03
20
70
0
80
50
39.33
20
70
0
80
40
38.67
50
70
40
80
40
56.67
70
70
70
40
70
66.00
90
0
100
10
100
58.00
80
40
90
30
80
64.67
PDCS 09
0
100
80
100
0
56.00
PDCS 10
0
60
10
30
0
22.00
PDCS 11
100
0
100
0
90
59.33
PDCS 12
80
80
70
100
80
80.67
Factor
PDCS
Alternatives
PDCS 04
PDCS 05
PDCS 06
PDCS 07
PDCS 08
Predetermined Effectiveness Values
(Table EV-1)
Preference
Weight
Aggregate
Score
Benefits of the Tool
• Relates PDCS to project objectives
and success parameters.
• Provides a decision support tool to
facilitate selection of most
suitable PDCS.
• Expands knowledge base with
well-defined, documented PDCS
alternatives.
Benefits of the Tool
• Provides rationale for selecting
PDCS, based on quantification of
alternatives.
• Supports CII Best Practices:
- Alignment
- Pre-Project Planning
PDCS
Implementation Session
LOW LEVEL
OF
CHANGES
MAXIMIZE
CONTROL
LOWEST
COST
SHORTEST
SCHEDULE
PDCS – Implementation Session
Moderator
Wayne Burchette
Eastman Chemical
Panel
Stu Anderson
Texas A&M University
Stan Berger
3M Company
Robert P. Kehoe
NASA
Larry Kruse
Murphy Company
Construction Project Improvement
Conference
2001: A Construction Odyssey
Trends and Perspectives
Construction Industry Institute
Austin, Texas