CIFE Center for Integrated Facility Engineering CIFE Seed Proposal Summary Page 2013-14 Projects Proposal Title: Enhancing Pre-Construction Decision-Making on Sustainable Commercial Building Projects Principal Investigator(s): Michael Lepech, Gary Griggs Research Staff: Kelcie Abraham Proposal Number: 2013-10 Abstract (up to 150 words): Architecture, engineering, and construction (AEC) teams need more efficient and effective decisionmaking methods, particularly during pre-construction of sustainability-focused projects when decisions have the most impact on sustainability performance. The multi-disciplinary nature of decision-making and the engagement of multiple stakeholders often result in decision problems with multiple objectives, calling for approaches referred to as multi-criteria decision-analysis (MCDA). There is little consensus on the best method for pre-construction decision-making. This work proposes the enhancement of preconstruction decision-making for sustainability-focused projects through design and implementation of a multi-criteria decision-analysis framework. The research, to be conducted with students and interested CIFE participants, will be used to evaluate the process and decision quality of different MCDA methods and study the treatment of sustainability objectives. Ultimately, by better integrating sustainability into pre-construction and developing more rigorous decision-making frameworks that are quick and easy to use, AEC professionals can help clients achieve sustainability goals with greater efficiency. 1. Motivation 1.1. Research Background Across the U.S., demand for environmentally sustainable buildings is growing; as shown in Figure 1, the market for non-residential green buildings has increased rapidly over the past decade. Green buildings are “structures…that are environmentally responsible and resource-efficient throughout the building’s life cycle” (US EPA 2012). Often, green buildings are certified through programs like the US Green Building Council’s Leadership in Environmental and Energy Design (LEED) rating system, which envisions green buildings as structures that reduce operating costs and increase asset value; decrease waste sent to landfills; conserve energy and water; are healthier and safer for occupants; and reduce harmful greenhouse gas emissions (USGBC 2012). As of June 2012, two billion square feet of building space have been LEED-certified, and LEED is referenced in project specifications for 71% of projects valued at $50 million and over (USGBC 2012). In 2010, 78% of architecture and engineering firms and 81% of contractors reported that client demand was driving them toward green building investment (MHC 2010). Consequently, professionals in the Architecture, Engineering, and Construction (AEC) industry need to become skilled at developing and delivering green buildings for clients. Figure 1 The value of the non-residential green building market in the US has grown significantly since 2005; the share of new construction starts that are green has also increased. Adapted from McGraw Hill Construction (2012) Over the course of a building project, architecture, engineering, and construction (AEC) consultants predict and evaluate the performance of many different design and construction options. The daily designconstruction recommendations that these AEC consultants make to the client have significant impacts on the sustainability of the building throughout its life cycle. (Ugwu and Haupt 2007) With contractors and designers frequently working under strict budget and schedule constraints, AEC consultants need superior planning, design, and construction processes to achieve client goals. It is critical that AEC professionals have the appropriate tools and effective processes to integrate sustainability into their everyday decisionmaking processes. One of the most active and important stages for decision-making is pre-construction. For the purposes of this proposal, pre-construction encompasses all of the phases in which changes to the design are minimal but design and construction details are still being finalized. This means that during preconstruction, decision makers are dealing with decisions that have fewer, better-defined alternatives to consider and more information to accurately evaluate those alternatives as compared to early-stage design. However, while decisions may be fewer and easier to model, the ability of decision makers to change project design and cost decreases and the cost of design changes (in terms of resources and budget) increases significantly. The MacLeamy Curve, displayed in Figure 2, describes this phenomenon. Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 2 Figure 2 The MacLeamy Curve (MSA-IPD 2012) 1.2. Industry Example AEC professionals and researchers are actively investigating formal decision processes in practice, primarily for early-stage design and pre-construction. A case study was conducted with a CIFE member company during the pre-construction phase of a single large-scale, sustainability-focused project, executed using Integrated Project Delivery (IPD). The company sought clear communication and desired a rigorous decision-making process to ensure that high-level performance goals, including cost, schedule, safety, and sustainability objectives, would be met. The multi-objective, multi-disciplinary nature of preconstruction decision meant that selecting an appropriate decision-making process was key. The team was concerned with identifying an appropriate process for project-related decisions that had a significant impact on project cost or schedule and required supporting information from AEC professionals. These decisions included, but were not limited to, trade partner selection, technology adoption, and detailed systems comparisons. For several months during pre-construction, the company implemented two formal, value-based decision methods: first Weight, Rate, and Calculate (WRC), then Choosing By Advantages (CBA) (Suhr 1999). However, the company found that neither process led to decisions of satisfactory quality and eventually rejected both. In general, decision makers found that CBA enabled multi-disciplinary stakeholder participation and added value to decision-making for simple decision problems. However, decision makers also believed that CBA was inefficient and ineffective for more complex decision problems and did not adequately clarify decision rationale. The introduction of an online tool, Wecision Enterprise (DPI 2013), to support CBA improved efficacy, efficiency, and value of information derived from the decision-making process, but clarity of rationale remained an issue due to the inherent complexity of decision problems and inconsistencies in factor selection between decisions. These observations suggest the need for future research concerning the design and implementation of appropriate tools for pre-construction decision-making on lean projects. 1.3. Research Objectives This research has two primary goals. The first is to determine which decision-making methods produce the highest quality decisions – that is, which process is best suited for pre-construction decisions on sustainability-focused projects. The second objective is to gain insight into the best way to integrate sustainability objectives into pre-construction decision-making and in turn, to establish a foundation for Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 3 further research to determine how integrated sustainability pre-construction decision-making can be enhanced. 2. Points of Departure 2.1. Multi-Criteria Decision Analysis (MCDA) The multidisciplinary nature of AEC decision-making and the engagement of multiple stakeholders often result in decision problems with multiple objectives. This particular structure of decision-making calls for a set of approaches referred to as multi-criteria decision-analysis (MCDA). MCDA methods structure and model the imprecise goals of multi-dimensional decision problems in terms of a set of individual decision criteria, where each criterion characterizes a single dimension of the problem to be evaluated. The general framework for most MCDA involves decomposing the decision problem into components, evaluating each component individually, and reassembling the components to provide overall insights and recommendations (Seppälä et al. 2002). AEC professionals and researchers are actively investigating formal decision processes in practice, primarily for early-stage design and pre-construction. Although treatment of MCDA methods in construction decision-making literature is fairly limited, a number of researchers have focused on developing decision support systems that use MCDA to select projects for investment (Lam et al. 2001; Dey 2006), choose project procurement methods (Kumaraswamy and Dissanayaka 2001; Anderson and Oyetunji 2003; Mahdi and Alreshaid 2005), and enhance early-stage design (Ugwu and Haupt 2007; Turskis et al. 2009; Flager et al. 2012). The majority of MCDA methods examined in the literature and implemented in practice are value-based. Value or utility theory approaches ask decision makers to develop a numerical score or value for each decision alternative and choose the alternative with the highest value. Examples include multi-attribute utility theory (MAUT), analytic hierarchy process (AHP), and simple multi-attribute rating techniques with swing weights (SMARTS) (Lahdelma et al. 2000). CBA is also considered a value-based method. In the AEC industry, CBA has been applied to decisions about green roof systems (Grant and Jones 2008), installation of viscous damping walls (Nguyen et al. 2009), and exterior wall assemblies (Arroyo et al. 2012, 2013). Although a number of decision-making techniques are currently being investigated and applied throughout the design and construction process, few researchers have studied pre-construction applications of value-based methods or the implementation of non-value-based methods on sustainable building projects. Other processes include goal programming, outranking methods, fuzzy set theory, and descriptive methods. Research on MAUT, single-value decision analysis (Howard 1966) and the development of objective functions for sustainability-focused pre-construction decisions has also been limited. 2.2. Evaluating Decision Methods Several researchers have developed metrics for comparing and selecting decision processes. Hazelrigg (2002) defines a framework for considering whether a decision method: (1) allows a user to express preferences and uncertainties; (2) does not impose constraints or ordering, and; (3) self-consistently rankorders alternatives. Given most complex AEC decisions are collaborative, Chachere and Haymaker (2011) propose metrics and a process for measuring the clarity of decision rationale, including the teams involved in the decision, the objectives defined, the alternatives explored, the impacts assessed, the preferences stated, and the value determined. Senescu and Haymaker (2013) recommend metrics and a process for measuring the efficiency and effectiveness of communicating process when creating rationale. Clevenger and Haymaker (2012) identify methods to measure and compare the challenges addressed, the methods used, and the exploration and guidance achieved. Arroyo et al. (2012, 2013) explored the characteristics that distinguish viable decision-making methods, particularly for selecting sustainable alternatives. Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 4 2.3. Sustainability Integration Decisions and decision-making processes associated with sustainability-focused construction are expected to be significantly different from the decisions and decision-making processes of traditional construction. This is due in large part to the often-conflicting nature of sustainability objectives, the relative unfamiliarity of building owners and AEC professionals with many sustainability concepts and metrics, and the extended validation process and efficacy timeline associated with most sustainability efforts. The achievement of sustainability goals can only be known far into the future. Comello et al. (2012) note that sustainable development and construction is now defined by the criteria used to recognize it: for example, “pre-construction air quality permit requirements,” “purchase of renewable energy,” “attainment of LEED certification.” As discussed by Comello, these are not correct formal logic definitions. A major problem with such concepts of sustainable construction is the fundamental ex post facto nature of sustainability: in most categories, today’s construction projects may only be deemed sustainable many years from now. Defining sustainability in such long time frames with little certainty in feedback means there is little incentive to focus attention on sustainable practices due to the high level of uncertainty in the returns on such sustainability investments. The absence of definite feedback in the short-term – positive or negative – significantly complicates the pre-construction decision-making process. 3. Methods 3.1. Charrette Tests Decision-making charrettes similar to those conducted by Clevenger and Haymaker (2011) and Senescu and Haymaker (2013) will be conducted with Stanford students and subsequently, industry professionals from interested CIFE companies. The first charrette will be composed of two mock pre-construction decision scenarios and will be used to test different decision-making methods identified in the literature and through the initial industry observations. The decision scenarios will reflect common situations in pre-construction that are easy to understand and simple to evaluate, with approximately three alternatives. The first proposed decision problem is the choice between eco-friendly or more traditional jobsite trailers, which is based on an actual decision from the sustainable campus project. The second problem is the selection of a steel subcontractor, also based on a decision from the project. The decision scenarios will include all performance prediction data relevant to the problem, as well as an explicit statement of client project objectives. Groups of three or four Stanford graduate students will be taken through the exercise using different MCDA methods. Each group will analyze one decision scenario using the weighted sum method (also known as weight, rate, and calculate) – the first value-based method that was selected on the project. This analysis will constitute the business-as-usual case. Subsequently, the groups will analyze the same decision problem using the analytic hierarchy process, outranking methods, or single-value decision analysis; the method will be determined randomly. Fuzzy set theory is also being considered. Time and resources permitting, the group will analyze the second decision scenario using the weighted sum method and an additional process, different from the second approach to the first decision problem. The use of two decision scenarios is meant to minimize the learning effect from solving the decision problem using the weighted sum method. The groups will conduct their analyses using Microsoft Excel templates provided by the researchers. These Excel templates will contain macros to track the group’s progress throughout the analysis, including a complete history of cell value assignments, and compile the relevant data, which are identified in the next section. Following the each decision scenario, participants will be asked to complete short group and individual surveys (4-5 questions) related to the process. This is meant to elicit decision maker satisfaction with process and outcome. The information gathered from the student charrettes will support preliminary evaluation and comparison of the decision methods and streamlining of the charrette for testing with industry groups. For the industry charrette tests, the decision scenarios may also be modified to reflect actual pre-construction decisions on the project. Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 5 3.2. Comparing Decision Methods The decision methods will be tested against several metrics adapted from the literature for selecting a decision-making approach. Each method will be considered in terms of five factors: 1. 2. 3. 4. 5. Stakeholder participation Clarity of rationale Efficiency of process Effectiveness of process Value of information delivered This evaluation will be conducted based on the data from the charrettes as well as verbal feedback from the participants when relevant. Comparison metrics have been identified from a study conducted by Davey and Olson (1998), who compared two different multi-criteria group decision support methods and one commercial group decision support system. Descriptive variables to be determined from the Excel spreadsheets include number of preference changes, number of solutions changed, time to solution, preference changes per unit time, and solutions considered per unit time. The exact descriptor of preference in the spreadsheet varies somewhat with MCDA method. In general, preferences are expressed through value assignments or weighting schemes (value-based methods), strength of pairwise comparisons (outranking methods), and objective functions and preference probabilities (single-value decision analysis). Davey and Olson (1998) also suggest user satisfaction as comparative metric; this will be assessed qualitatively through the surveys and verbal feedback. Existing decision-making tools are underutilized and their final conclusions are sometimes mistrusted. Often, the perception decision-makers have of decision quality is just as important as the . Therefore, when examining the MCDA techniques as applied to pre-construction decision-making, careful attention should be paid to the preferences of decisionmakers using the tools, including whether they would choose to adopt them. Measures of enhancement include decision-maker ratings, reductions in decision-making time requirements and meeting lengths, and the likelihood of adoption for future projects. 3.3. Assessing Sustainability Integration As discussed previously, evaluating the achievement of sustainability objectives in the short term poses an interesting challenge. One possible short-term evaluation measure for pre-construction decisionmaking is the satisfaction of the client or owner. Having specified a desired level of “green” or sustainability performance for the overall project during preliminary design, most clients see their goals first take shape in the pre-construction phase when design details are finalized, subcontractors are selected, and construction gets ready to commence. As such, advanced specification and careful selection of sustainability decision criteria is a major component of the enhanced decision framework with practical implications. Understanding how criteria specification of sustainability-focused goals influences the success or perceived success of client sustainability objectives can provide insight into how likely decision makers are to implement the decision framework. In many regards, notions of client satisfaction are a practical measurement of achieving sustainability goals for a construction project, particularly in light of the ex post nature of sustainability, and can relate directly to repeat work for the contracting firms and economic viability of the project team. To assess the success of sustainability integration in decision-making, clear sustainability objectives will be stated for the hypothetical project relating to each decision scenario. For each decision analysis, the objectives met by the decision solution will be compared against the initial list; a higher number of achieved objectives indicates better sustainability integration. Some groups may also be provided with a list of all client goals during the business-as-usual decision analysis and be asked to eliminate those that are irrelevant in light of the objectives given in the scenario description, whereas others will be asked to generate an additive list of objectives working only from the scenario description. The hypothesis is that groups who eliminate goals to produce the decision objectives will achieve better sustainability Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 6 integration (i.e. greater number of sustainability goals met by the decision solution) than those who generate the decision objectives. 4. Relationship to CIFE Goals 4.1. Schedule Performance This research will enable the development of decision-making processes that require fewer process iterations and result in higher client satisfaction with decision quality during pre-construction. Thus, it allows teams to generate better performance predictions and conduct further analyses as opposed to spending time in decision-related meetings. 4.2. Cost Conformance This research will clarify the relationship between explicitly stated project development objectives and pre-construction decisions that determine project performance. The improvements to decision-making methods will also allows decision stakeholders to more clearly observe and monitor that the intended process “checklist” has been followed successfully, and may also lead to improvements in value-formoney. 4.3. Sustainability The proposed research will lead to improvements in the decision-making process that will help decision makers to explicitly and systematically consider sustainability objectives in decision-making. As quantitative sustainability metrics become more widely understood, decision-makers will be more able to incorporate their knowledge easily into their decision analysis without altering their decision-making process. 4.4. Globalization As sustainability goals are implemented for projects all around the world, it is necessary for competitive construction firms to have flexible, yet robust decision-making methods in place to efficiently and quickly make decisions at every stage of a sustainability-focused project. The proposed research will lead to improvements in construction firms translating highly sustainable designs for the built environment into actual constructed facilities, much of which is now lost during inefficient and confusing pre-construction decision-making efforts. 5. Industry Involvement CIFE members and other industry partners will be involved in this project through the development of decision scenarios and participation in the charrettes. Further testing of the enhanced decision framework may be pursued on different CIFE member industry projects, and additional follow-up interviews and surveys may be conducted with industry participants. This work also leverages the industry experience and relationships of Consulting Professor, Gary Griggs, as a Co-PI. Professor Griggs joined the CEE faculty after serving as the chairman of ParsonsBrinckerhoff Americas and thus brings an industry oriented-view to the proposed research program. The proposed research will be Professor Griggs’ first research effort with CIFE. 6. Research Plan, Schedule, and Risks 6.1. Research Plan 1. Student Charrette (May/June 2013): development of Excel templates (user interface and macros), implementation of charrette tests at Stanford. Abraham, Lepech, Griggs Enhancing Pre-Construction Decision-Making 7 2. IGLC Conference (July 2013): publication of initial observations from sustainable campus project and general framework for evaluating decision methods in conference proceedings (abstract accepted; full draft in review), presentation of more detailed evaluation framework and preliminary findings from student charrettes. 3. Industry Charrette (August/September 2013): modification of charrettes to address real project decisions, implementation with CIFE members and industry partners on real projects. 4. Charrette Follow-Up (October/November 2013): continued charrette testing to collect any remaining data on sustainability integration and follow-up with industry participants. 5. Journal Publications (January-March 2014): publications on (1) the evaluation and comparison of MCDA methods and (2) enhancing sustainability integration submitted to peer-reviewed journals in construction management, sustainable construction, or decision analysis. 6.2. Risks 1. Software Development – To implement the decision-making software for use by CIFE industry partners, an easy-to-use graphical user interface (GUI) will need to be developed for the MCDA tool. The development of this GUI is not within the expertise of the project team. This risk will be mitigated by hiring a student software developer during the summer (as provided by the budget). 2. Timeline - The project timeline may be difficult to meet if industry projects cannot be found in the near-term for study this upcoming summer. Projects must be found that are in the preconstruction stage and have aggressive sustainability goals. This risk will be mitigated by offering participation to as many CIFE members as possible to find projects that are in the correct stage of planning and construction. 3. Project Identification - Researchers are dependent on the participation of CIFE’s industry partners to validate the proposed MCDA method. Industry collaborators must be willing to provide a set of case study decisions that focus on sustainability goals along with access to researchers to observe the decision-making process, implement charrettes with participants, and follow up with inquiries. This risk will be mitigated by offering participation to as many CIFE members as possible to find the right size and type of sustainability-focused project. 7. Next Steps Following CIFE seed funding, additional funds will be sought through a proposal to the National Science Foundation (Directorate of Engineering) to be authored by the PI that focuses on the application and extension of MCDA techniques to sustainability-focused decision-making beyond the construction industry. Regardless of additional funding support, this work will continue through 2014 based on student funding through the Stanford Graduate Fellowship. 8. Works Cited Anderson, S., and Oyetunji, A. (2003). 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