Evaluating bid item prices to support contractor selection ‐ a case study

Abstract

Bid price is a highly‐weighted appraisal criterion in a multi‐criteria evaluation method to select contractors for construction projects. By evaluating both the magnitude and reasonableness of the bid price, this study presents an electronically‐facilitated model for evaluating bid prices. The model defines a reasonable total price for a project and a reasonable cost for each cost category (or bid item) by considering the project prices estimated by the project owner and submitted by all qualified bidders. Scoring systems are then employed to score the prices submitted by bidders, and weighting methods are used to integrate the derived scores. The bidder with the highest integrated score receives the most favorable price appraisal. The merits of the proposed model are demonstrated by its successful application to a recent public construction project in Taiwan.     

Toward green dialysis: Focus on water savings

Hemodialysis is one of the most water and energy‐hungry medical procedures, and thus represents a clear opportunity where improvements should be made concerning the consumption and wastage of water. Three levels were investigated on which there are potential savings: the precise adjustment of water production according to specific needs, the reuse of reverse osmosis rejected water, and finally the huge volumes of post‐patient dialysate effluent. The “AURAL” (Association pour l′Utilisation du Rein Artificiel à Lyon), main unit in Lyon, was the site of investigation for this study, which cares for 173 chronic hemodialysis patients. Evaluation of the 3 levels described earlier was undertaken on this particular building, and on the water treatment currently used. Volumes of produced water can be improved by different hydraulic systems or by adjusting the pure water conductivity used for dialysis. Concerning the reject water, reuse for building sanitation became the focus of further attention. The technical feasibility, volume of saved water, and applicable work costs were considered. The results suggest that out of a possible 2834 m³/year of reject water, 1200 m³/year may be reused and return on investment recovered within 5.8 years. Finally, the reprocessing and feasibility of reuse of dialysate effluent were investigated. Initial calculations show that although technical solutions are available, such processing of the wastewater production is not profitable in the short term. Regarding the significant prior authorization and risk management analysis necessary for such a project, this avenue was pursued no further. From the perspective of a “green dialysis,” the reuse of reject water into sanitation is both viable and profitable in our unit, and must be the next step of our project. More widely, improvements can be made by defining a more precise range of pure water conductivity for dialysis and by applying reuse water project to new or to be renovated units.     

高速公路项目社会经济效益的产生机制 及其评价研究

基于系统工程的思想,通过分析高速公路社会经济效益产生的机制,建立了区域经济—公路交通发展系统动力学模型,以天津市津蓟高速公路为例,通过系统仿真误差检验,证实了该系统动力学模型的仿真效果较好、性能稳定。通过已建—未建高速公路系统仿真结果的有无对比,计算并预测出了津蓟高速公路2003—2013年各年的社会经济效益,从而实现了高速公路项目社会经济效益评价的定量化目标,为今后类似项目的开展提供了理论指导。     

A Goal Programming Application of Capital Project Selection in the Production Area

Managers of large production operations are often confronted with the necessity to invest in capital projects whose income generating capacity is not the prime consideration for selection. Examples of this type of investment include projects which satisfy safety, environmental, union and/or consumer requirements placed on the firm. This paper describes and demonstrates a goal programming model for project selection when both profit and nonprofit motivated projects are in competition for scarce resources.     

区域制造业信息化工程项目管理体系研究及应用

作为制造业信息化工程的一个重要组成部分,区域制造业信息化工程包含了很多项目.为了有效地管理好这些项目,将项目管理理论运用到对区域制造业信息化项目的管理中,提出了区域制造业信息化工程项日管理体系.该体系包括单项目管理、项目群管理以及项目组合管理3个层次,研究各层次的管理内容.介绍了研究成果在重庆市"十五"制造业信息化工程中的应用情况.     

Predicting Military Construction Project Time Outcomes Using Data Analytics

Abstract

Through its Department of Defense (DoD) agencies, and outside contractors, the USA invests billions of dollars each year in military construction (MILCON) projects. Although construction management expertise is gained and significant amount of data are collected from past projects, completing projects on time remains a challenge. This article uses data from 466 MILCON projects to identify key factors that influence project duration and provide a new model to predict project time outcomes. The model generates accurate results and serves as a useful tool in the early phases of a project life cycle. Another key contribution of this study is the employed methodology, which includes the use of available data, targeting of relevant parameters, and development of the predictive model. The contributed methodology is applicable outside of the MILCON domain with the appropriate data set and by targeting the relevant influential factors to create models to predict time outcomes of future projects.     

Measuring Six Sigma Project Effectiveness using Fuzzy Approach

Six Sigma methodology for process improvement is being used by industries to improve customer satisfaction, business results or both. The success of Six Sigma implementation can be measured by evaluating the effectiveness of the completed projects. The other objective of project effectiveness measurement scheme is to keep the team focused and motivated. A good measurement system should be able to measure and compare projects of various types and need, including benefits from the projects. The project effectiveness measurement scheme should include success factors like project selection, involvement of management, results achieved, conduct of the project and monitoring and review of the project. A Six Sigma project effectiveness evaluation system is generally based on the perception of people that can result in unreliable measurement. To overcome this deficiency, we used a fuzzy approach based on linguistic variables and fuzzy numbers for measuring the project effectiveness in this study by using the perception of management. Two methods for measuring effectiveness of selected sample projects are suggested. The outcome from this research would be helpful for the practicing industries to use this methodology for an unbiased evaluation of completed projects. Copyright © 2012 John Wiley & Sons, Ltd.     

在激烈竞争中持续发展——来自克朗斯

由于全球价格战愈演愈烈，克朗斯在2005年前九个月的税后利润同比下降了2．6％，但由于强劲的第四季度，其年度盈利仍好于去年。[编者按]     

A framework for performance-based design

The international competitiveness of the US construction industry is linked to its strategic ability to design and build quality projects. This means delivering facilities that satisfy all the needs of the client. Correct decision-making during design and construction planning is the best means for assuring a quality project. Performance-based design is a framework that enables the project team to approach the project delivery process systematically and provides basic principles for evaluating and comparing alternative solutions. The principles of axiomatic design (as previously advanced by Suh) and the concept of an interface index are key elements of the framework. Axiomatic design provides an operational structure for the design process as well as a set of basic principles or axioms for guiding each decision-maker. The interface index complements the design axioms by quantifying the effort associated with integrating the contributions of multiple decision-makers into a total system. Elements of the framework are demonstrated through application to an actual facility.     

The discrete time/resource trade-off problem in project networks: a branch-and-bound approach

In many solution methods for resource-constrained project scheduling, it is assumed that both the duration of each activity and its resource requirements are known and fixed. In real-life projects, however, it often occurs that only one renewable bottleneck resource is available and that the activities have a total work content which indicates how much work (expressed in man-periods) has to be performed. The objective then is to schedule each activity in one of its possible execution modes, subject to the precedence and resource constraints, in order to minimize the project makespan. We present a branch-and-bound procedure and report computational results, obtained using a full factorial experiment on a randomly generated problem set.     

Evaluating management of large,complex projects: A framework for analysis

Increasingly owners and managers of large, complex projects are challenged in law suits and regulatory proceedings to justify their decisions. These challenges often question the prudence or reasonableness of management actions on a project costing substantially more than its original estimate. Frequently these attacks criticize decisions made years earlier by project owners or managers. This article describes a framework for evaluating management prudence based on the author's 20 years of research and personal experience with large, complex projects. The framework distinguishes between evaluations to determine prudent/imprudent management, and conventional “lessons learned” management audits. The author concludes that, while hindsight knowledge is a useful ingredient in “lessons learned” audits, it usually provides misleading signals for a management audit to determine prudence or imprudence. He concludes that any finding of management imprudence must meet the eight criteria described in the framework.     

Process Uncertainty: A New Dimension for New Product Development

Abstract

Companies pursuing product leadership continually push products into innovative technology areas and new unknown markets. As companies continue to strive for continuous innovation, often leapfrogging even their own technology, new product development (NPD) processes play an increasingly important role in defining the success or failure of many new innovations. In addition, increased competitive rivalry is driving companies to commercialize their new products much more quickly. To meet these pressures, new strategies are being used to supplement the conventional new product development process that consists of strategy formulation, idea generation, screening and evaluation, development, testing, and launch. The primary objective of each of these innovation strategies is to attain sustainable competitive advantage for the company and achieve higher overall performance.

Our research examined product and service innovation strategies of six projects. Half of which were considered successful and the other half failures. Using several emerging innovation strategies including process-driven, speed-to-market, quantitative, market-driven, technology-driven, and learning-driven to classify these projects, we evaluated the innovation strategies employed in an attempt to determine the overall NPD strategy effectiveness. In addition, we also attempted to identify relevant critical success factors and associated activities to construct an ideal innovation strategy model.

In the projects we studied, we found that no one best strategy leads to successful innovation. While evaluating areas of uncertainty that impact project success, we determined that a new dimension, process uncertainty, plays as important a role as market or technical uncertainty previously examined in the emerging scholarship. Furthermore, the insights that were discovered by comparing the different innovation strategies led us to formulate the technical-market-process (TMP) uncertainty mode. The TMP model serves as a predicator for identifying the appropriate innovation strategies that can be brought together to drive project success. We conclude that the combination of identifying the appropriate innovation strategies and proficiently executing these strategies is the key to successful new product development.     

Traffic fatalities and economic growth

This paper examines the relationship between traffic fatality risk and per capita income and uses it to forecast traffic fatalities by geographic region. Equations for the road death rate (fatalities/population) and its components--the rate of motorization (vehicles/population) and fatalities per vehicle (F/V)--are estimated using panel data from 1963 to 1999 for 88 countries. The natural logarithm of F/P, V/P, and F/V are expressed as spline (piecewise linear) functions of the logarithm of real per capita GDP (measured in 1985 international prices). Region-specific time trends during the period 1963-1999 are modeled in linear and log-linear form. These models are used to project traffic fatalities and the stock of motor vehicles to 2020. The per capita income at which traffic fatality risk (fatalities/population) begins to decline is 8600 US dollars (1985 international dollars) when separate time trends are used for each geographic region. This turning point is driven by the rate of decline in fatalities/vehicles as income rises since vehicles/population, while increasing with income at a decreasing rate, never declines with economic growth. Projections of future traffic fatalities suggest that the global road death toll will grow by approximately 66% over the next twenty years. This number, however, reflects divergent rates of change in different parts of the world: a decline in fatalities in high-income countries of approximately 28% versus an increase in fatalities of almost 92% in China and 147% in India. The road death rate is projected to rise to approximately 2 per 10,000 persons in developing countries by 2020, while it will fall to less than 1 per 10,000 in high-income countries.     

On scheduling project activities with variable expenditure rates

Commercial projects are undertaken with the expectation of maximizing financial returns. There are a variety of cash flow models in the literature in which payments, whose amounts depend on the type of contract quoted between the contractor and the client, are tied to the project events or to the completion times of activities. These models are of deterministic nature with respect to cash inflows, that is, the amount and timing of the payments, once determined, are fixed. However, there are situations specifically in the housing industry where the contractor is the owner of the project. In this case, the contractor starts with an initial capital to cover the activity expenditures and then, capital is augmented by the sale of flats which take place randomly over the progress of the project. In this risky environment, the contractor has to decide on the rate of expenditure at each decision time in order to maintain a positive cash balance. Hence, activities are represented by multiple performing modes with different activity durations and the same total cost. A heuristic to construct and re-construct schedules during the progress of the project is proposed here with the aim of maximizing the project Net Present Value while completing the project on time. The heuristic incorporates dynamic mode selection criteria which change adaptively according to the current status of the project. Computational experiments with the heuristic demonstrates that it provides satisfactory results regarding the feasibility of the schedules with respect to the project due date and the nonrenewable resource constraints.     

Practice and experience of engineering culture development in the Sutong Bridge project

To keep up with the time, culture is integrated to large-scale construction project management in China, which will absolutely add more vitality into construction project management in our country. Engineering culture is an integration of project construction and engineering culture. However, engineering culture development enjoys its own particularity as a project is constructed once only within a limited period of time. This paper gives affirmative opinion that engineering culture development in large-scale projects backs project management on the basis of thorough investigation of engineering culture development in Sutong Bridge Project and after deepened analysis, proposes new thinking pattern of engineering culture development in large-scale projects in a systematic manner, including thorough understanding of the essence of engineering culture, principle and contents of engineering culture development as well as efficient method in respect of establishment and implementation of engineering culture, and therefore provides a standard reference and systematic thinking pattern for engineering culture development in future large-scale projects.     

R&D project selection and scheduling with a filtered beam search approach

Models developed for selecting an optimal portfolio of R&D projects from among a pool of available projects do not generally include project scheduling as part of the selection criteria. Typically after a portfolio of projects is selected according to various selection criteria, they are subsequently scheduled. If it is not possible to schedule the selected projects through various research facilities and/or stages given the available resources, projects may be replaced with others requiring less time, or resources may be increased, which can result in a suboptimal portfolio. In this paper, project scheduling is included in the selection process, with a heuristic filtered beam search approach. Projects are selected on the basis of traditional selection criteria such as expected profits, as well as the makespan of the portfolio. The heuristic search procedure is demonstrated by an in-depth example and computational experimentation.     

Decision-making support system for human resource allocation in product development projects

Recent dismal economic conditions and a ruthlessly competitive environment have forced many companies to restructure, or reorganize their priorities. For such companies, the concentration of various resources upon their particular corporate strong points has become a central strategy. Consequently, there has been a rapid increase in the importance of (1) selecting profitable projects from a wealth of possible alternatives and (2) optimizing the allocation of current resources among the selected projects. This paper proposes an optimization system for project selection that not only yields the most beneficial project set, but also the optimum allocation of human resources for the selected projects. The optimization system consists of two algorithms, namely (1) a project selection algorithm for choosing the set of projects that maximizes the total estimated profit, and (2) a human resource allocation algorithm for optimally placing human resources among the selected projects, having considered the satisfaction level provided by each employee's skills, personal motivation and career goals.     

Industrial Sponsored Design Projects Addressed by Student Design Teams*

We have developed and implemented a four‐quarter design sequence starting in the spring of the junior year. The first course focuses on having teams of students take an industrial based project from inception through a conceptual design process culminating in a final design specification. The senior year sequence is structured to have three‐five member teams function as a type of “engineering consultant firm” to address externally sponsored projects. The teams initially work with the sponsor to develop a “Product Design Specification (PDS)” as the foundation of the project. The teams then develop the conceptual design of the project during the fall quarter in order to get sponsor approval to move toward final implementation or prototype development during the winter and early spring teams. The course culminates with a day long symposium where each team makes formal presentations of their project and designs to the campus community, the sponsor representatives, and invited guests from the local community and potential industrial sponsors. The paper will present the specifics of the Junior and Senior level courses, brief overviews of the related Sophomore and Junior prerequisite courses, the method of obtaining the industrial sponsors, team formation process, sample projects, and assessment results from the first two offerings of the sequence.     

Investigating the multi-causal and complex nature of the accident causal influence of construction project features

Construction project features (CPFs) are organisational, physical and operational attributes that characterise construction projects. Although previous studies have examined the accident causal influence of CPFs, the multi-causal attribute of this causal phenomenon still remain elusive and thus requires further investigation. Aiming to shed light on this facet of the accident causal phenomenon of CPFs, this study examines relevant literature and crystallises the attained insight of the multi-causal attribute by a graphical model which is subsequently operationalised by a derived mathematical risk expression that offers a systematic approach for evaluating the potential of CPFs to cause harm and consequently their health and safety (H&S) risk implications. The graphical model and the risk expression put forth by the study thus advance current understanding of the accident causal phenomenon of CPFs and they present an opportunity for project participants to manage the H&S risk associated with CPFs from the early stages of project procurement.