Criteria for Selecting the Private-Sector Partner in Public–Private Partnerships

A critical issue in public–private partnerships (PPPs) in international infrastructure development is the selection of the right private-sector partner. This necessitates a best value source selection methodology in which the establishment of a set of appropriate selection criteria is a prerequisite. Various important selection criteria have been identified through a literature review of previous studies on critical success factors; experience drawing and lessons learning from international PPP practices; examination of selection criteria used in worldwide PPP projects; and interviews/correspondence with international PPP experts and practitioners. These identified criteria are classified into four evaluation packages for PPP projects in general: (1) financial, (2) technical, (3) safety, health, and environmental, and (4) managerial. The relative importance of these evaluation packages and the relative significance of the criteria within each package have been statistically analyzed based on a structured questionnaire survey of worldwide PPP expert opinions. These statistical analyses include validity and reliability analysis, Mann Whitney U tests, direct comparisons of mean criterion significance indexes and criterion rankings between respondents across public, private, and academic sectors, and a general rank agreement analysis across sectors for each evaluation package. These research outputs would facilitate the formulation of a multicriteria best value source selection methodology for PPP projects in general and the development of both objective and subjective evaluation criteria to select the right private-sector partner for a particular PPP project.     

Risks in Chinese Construction Market—Contractors’ Perspective

With China’s entry into the World Trade Organization (WTO), the Chinese construction market will be increasingly open and finally become part of the international market. Because of different social and economic systems, as well as different historical and cultural backgrounds, contractors are likely to encounter different risks in different markets. Based on questionnaires and case studies, this paper adopts an importance evaluation index and makes an importance evaluation of various risks encountered by Chinese contractors when contracting for projects in Chinese markets. This paper also makes comparisons between and analyses of the research findings and related available investigation results. The Cox–Stuart trend increase test method is applied in the current research, the results indicating that the variance corresponding to the importance index value tends to increase as the risk event importance decreases. This tendency shows that those investigated tend towards unanimity in terms of higher importance risk events. This paper also examines the reliability of the questionnaires by means of Cronbach’s Alpha Coefficient. The research shows that the main risk currently encountered by Chinese contractors in domestic markets includes owner’s irregular behavior and government departments’ interference in construction markets. China’s accession to the WTO has provided greater opportunities for international contractors to enter the Chinese construction market. Therefore the research results described in this paper can provide valuable data enabling international contractors to gain a better understanding of the potential risks in the environment of the Chinese construction market.     

Critical Success Factors for Public–Private Partnerships in Infrastructure Development

Different types of public–private partnerships (PPPs) have been practiced in worldwide infrastructure development with diverse results and a variety of problems have been encountered. A number of factors combine to determine the success or failure of an infrastructure project in terms of its objectives. There is an urgent need for a workable and efficient procurement protocol for improved practices in future PPP projects. As an important step toward the development of such a protocol, this study identifies, analyzes, and categorizes various critical success factors (CSFs) for PPPs in general based on a public–private win–win principle and a systematic research approach that includes case studies, literature review, and interviews/correspondence with international experts. A CSF package is developed that contains five main CSFs, each including a number of success subfactors (SSFs). Relative significances of these CSFs and SSFs are examined based on the results of a questionnaire survey of international expert opinions. Agreement analysis shows that there is a good agreement in the ranking of these CSFs and SSFs between respondents from the industrial sector and those from the academic sector.     

合同管理在项目管理中的地位和作用

在现代建筑工程项目管理中合同管理具有十分重要的地位,已成为与进度管理、质量管理、成本(投资)管理、信息管理等并列的一大管理职能。合同管理对项目的进度控制、质量管理、成本管理有总控制和总协调作用,是工程项目管理的核心和灵魂,这是由合同在社会主义市场经济条件下以及现代建筑管理工程中的独特作用所决定的。在国标清单计价规范实施之际,作为一名造价工程师更应该熟悉和了解合同管理的地位和重要性。     

Outside the Budget Box—Public/Private Partnership as a Creative Vehicle for Finance and Delivery of Public School Facilities

Our public schools face almost irresistible pressures to upgrade and expand facilities and deliver better, more advanced, and higher-quality education while tax revenues and therefore budgets are shrinking each year. Class sizes grow in old and outdated facilities, and municipalities and school districts have few resources to address the pressing space needs. There is little public support for increased funding. However, there is a way to deliver educational facilities that uses less public capital than traditional project finance. Public/Private Partnership (PPP) is a delivery method that has traditionally been used on large infrastructure projects in developing nations, in order to allow more development for less public capital investment while maintaining the overall quality of construction. In recent years, PPP has gained acceptance in Europe and now in the United States as a means of public school finance and construction. This paper discusses PPP, its fundamental principles, and the various ways it can be employed in the delivery of educational facilities, as well as its advantages and disadvantages.     

Empirical Study of Risk Assessment and Allocation of Public-Private Partnership Projects in China

Earlier research studies on public-private partnership (PPP) indicated that an objective, reliable, and practical risk assessment model for PPP projects and an equitable risk allocation mechanism among different parties are crucial to the successful implementation of these PPP projects. However, actual empirical research works in this research area are limited. This paper reports the first stage of a research study, which aims to identify and assess the principal risks for the delivery of PPP projects in China and to address their proper risk allocation between the private and public sectors. An empirical questionnaire survey was designed to examine the relative importance of different risk factors and to analyze the allocation of risk factors to different parties in PPP projects. A total of 580 questionnaires were sent out, and a total of 105 valid responses were obtained for data analysis. The Mann-Whitney U test is employed to investigate whether significant difference in perception existed first between the private and public sectors and second between industrial practitioners and academics in China. The empirical findings show that the three most important risk factors for PPP projects in China are (1)?government intervention; (2)?government corruption; and (3)?poor public decision-making processes. These findings reveal that the Chinese government intervention and corruption may be the major obstacles to the success of PPP projects in China. A major cause for these risks may be attributed to inefficient legislative and supervisory systems for PPP projects in China. After conducting the Mann-Whitney U test on the 105 survey respondents, the empirical findings indicate that the perceptions of all 34 risk factors in China between the private and public sectors were not significantly different. Similarly, there were no significant differences between academics and industrial practitioners except that the former perceived the problem of government corruption to be more severe than did the latter. For risk allocation, the empirical results indicate that the public and private sectors were in general consensus with most of the risks identified. The major risks that the public sector preferred to accept are within the systematic risk category, especially political, legal, and social risks. The private sector preferred to retain the principal risks within the specific project risk category, especially construction, operation, and relationship risks, in addition to economic risks within systematic risk category. The remaining risk, environment risk, is preferred to be shared between the two sectors. This research study enables international construction companies to better understand how risks should be assessed and allocated for PPP projects in China. It also assists in risk response planning and control for future PPP projects in China.     

International Expansion Decision for Construction Companies

There exist several reasons for construction firms to expand their business into international markets. But the complex international environment is affected by diverse factors and creates risks that are not well understood by companies that are active mostly in domestic markets. It is therefore essential for construction companies to follow a disciplined and well-informed strategy when deciding whether to enter international markets. Company strengths relative to conducting business in international markets, the threats and opportunities associated with overseas work, and the costs and benefits of undertaking construction projects in specific countries need to be considered in this decision. The interactions between the complex factors can be structured in a model that can help one to make a rational judgment. The International Expansion Decision Model developed in this study is based on the Analytic Hierarchy Process (AHP) improved by the addition of a Delphi survey. The main objective of this research study is to facilitate the entry decision into foreign markets and to highlight the importance of the factors involved in this decision. This study is of relevance to practitioners as it allows executives of construction companies to test if their company is ready for expansion into international markets in general and into a specific country in particular. It is also of relevance to researchers as it demonstrates the successful use of the combined Delphi and AHP methods.     

Ontology for Relating Risk and Vulnerability to Cost Overrun in International Projects

Risk management is about identifying risks, assessing their impacts, and developing mitigation strategies to ensure project success. The difference between the expected and actual project outcomes is usually attributed to risk events and how they are managed throughout the project. Although there are several reference frameworks that explain how risks can be managed in construction projects, a major bottleneck is the lack of a common vocabulary for risk-related concepts. Poor definition of risk and patterns of risk propagation in a project decrease the reliability of risk models that are constructed to simulate project outcomes under different risk occurrence scenarios. This study aims to extend previous studies in risk management by presenting an ontology for relating risk-related concepts to cost overrun. The major idea is that cost overrun depends on causal relations between various risk sources (namely, risk paths) and sources of vulnerability that interfere with these paths. Ontology is used to develop a database system that represents risk event histories of international construction projects and to construct a model for estimation of cost overrun. It will form the basis of a multiagent system that can be used to simulate the negotiation process among project participants about sharing of costs considering the risk allocation clauses in the contract, sources of vulnerability, and causal relations between risk events and their impacts. The ontology is constructed by interaction with Turkish contractors working in international markets and extensive literature review on risk-related concepts. The validation test results provide evidence that the ontology is fairly effective to help Turkish contractors to assess cost overrun by considering sources of vulnerability and risk in international construction projects.     

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.     

Critical Success Factors for Stakeholder Management: Construction Practitioners’ Perspectives

Although various factors have been identified as important for accomplishing successful stakeholder management, few studies appear to have undertaken a comparative analysis of practitioners’ views on the relative importance of critical success factors (CSFs) for stakeholder management in construction projects. In an attempt to fill this research gap, a questionnaire survey was conducted in Hong Kong to collect the opinions of construction practitioners regarding the relative importance of CSFs for stakeholder management. Findings from this study show that all 15 selected CSFs are regarded as critical by most respondents for the success of stakeholder management in construction projects. The factor regarding social responsibilities is considered most important for managing stakeholders. Although correlations between CSFs and types of projects and organizations were statistically significant, these were not particularly strong. Also, even though there is a general consensus on the rankings of the CSFs among different respondents, the detailed pairwise comparisons actually show the existence of a few differences in perceptions on the relative importance of the CSFs. Therefore, the working priorities of project managers for managing stakeholders are context specific, depending on the nature, client sector, and cost of the project, and also on their organizations and management levels in the organization. These findings should help project managers become more aware of their responsibilities and the relative importance of issues for management stakeholders.     

Quantiative Methodology for Determination of Cost Contingency in International Projects

This paper presents a quantitative methodology to determine financial impacts of the risk factors during the bidding stages of international construction projects. Project and country data of 26 construction projects from 21 countries were collected for evaluation of the international risk factors. The factors impacting cost contingency were identified using correlation and regression analysis techniques. The results indicated that four factors had major contributions for explaining the variations in the contingency levels. A regression model including the significant factors was developed to support bidding contingency decisions. The methodology presented provides a robust and practical statistical approach for determination of contingency by focusing on important risk factors. Details regarding model development and validation are presented along with a discussion on study limitations.     

Potential of Total Cycle Time Compression in Construction: Focus on Program Development and Design

Time compression is a widely accepted approach to improving customer service levels while minimizing total costs. However, few applications within the construction sector exist, especially in relation to the early stages of program development and design. These stages are of paramount importance because of the resultant ramifications on the total cycle time of the entire construction project, in the form of changes, rework, waste, and risk. Most applications of time compression focus on quantifying and removing nonvalue adding time from business processes. This is difficult for program development and the design stages of construction because most information sources are qualitative. As a result, a methodology has been developed to identify the key areas of potential improvement during these early stages. Collection of opinion data via semistructured interviews, questionnaires, and a workshop with a cross section of supply chain members has made it possible to quantify the potential improvements. The action research findings have been summarized into a time-compression model for the program development stages in the format of two interlinked cause and effect diagrams. These further emphasize the need for effective program development to minimize the risks of project overrun.     

Improved SWOT Approach for Conducting Strategic Planning in the Construction Industry

Strength, weakness, opportunity, and threat (SWOT) analysis has been in use since the 1960s as a tool to assist strategic planning in various types of enterprises including those in the construction industry. While still widely used, the approach has called for improvements to make it more helpful in strategic management. The project described in this paper aimed to study whether the process to convert a SWOT analysis into a strategic plan could be assisted with some simple rationally quantitative model, as an augmented SWOT analysis. By using the mathematical approaches including the quantifying techniques, the “maximum subarray” method, and fuzzy mathematics, one or more heuristic rules (HRs) are derived from a SWOT analysis. These HRs bring into focus the most influential factors concerning a strategic planning situation, and thus inform strategic analysts where particular consideration should be given. A case study conducted in collaboration with a Chinese international construction company showed that the new SWOT approach is more helpful to strategic planners. The paper provides an augmented SWOT analysis approach for strategists to conduct strategic planning in the construction industry. It also contributes fresh insights into strategic planning by introducing rationally analytic processes to improve the SWOT analysis.     

Using Weibull Analysis for Evaluation of Cost and Schedule Performance

Large amounts of money are lost each year in the construction industry because of poor schedule and cost control. Few contractors specify and follow systematic schedule monitoring practices. Traditionally, the earned value method (EVM) is used to control and monitor schedule performance using the schedule and cost performance indices which compare the budgeted cost of work performed to what was originally scheduled or what is actually expended. This paper presents a statistical approach, namely Weibull analysis, to evaluate stochastically the schedule performance of construction or design projects. The approach can be used in conjunction with the EVM to enhance the evaluation and control of schedule performance. Weibull analysis is a common method for failure analysis and reliability engineering used in a wide range of applications. In this paper, the applicability of Weibull analysis for evaluating and comparing the reliability of the schedule performance of multiple projects is presented. The various steps in the analysis are discussed along with an example in which two projects are analyzed and compared. The authors conclude that Weibull analysis has several advantages and provides a relatively robust and effective method for construction managers to better control and monitor their projects.     

Productivity Analysis of Construction Operations

An interactive system for analysis of construction operations is proposed. The analysis is carried out in the context of various work modules which address quantity development, resource definition, and production and cost analysis. The quantity work module generates quantities based on information available in the design documents. The resource definition module receives and stores data regarding the labor∕equipment combination to be used to execute work tasks. This module provides the user with a set of standard useful construction process models. For each construction operation to be analyzed, the terminal describes the standard models. The user makes input of a set of parameters for process keyname, quantity, work task durations, number of resources, production capacity of each unit, and cost per hour of each unit to the standard model to be used. Using input from the resource definition module, the productivity and cost analysis module generates production rates and unit costs based on process simulation using CYCLONE methodology.     

Cross-Cultural Understanding of Construction Project Managers’ Conceptions of Their Work

In recent reforms of the Chinese construction industry, significant efforts have been made toward the introduction of Western project management theories and practices. However, little is known about the extent to which Western project management concepts have been supported by the Chinese culture. Because of certain differences between the two cultures, Chinese managers’ conceptions of their work are likely to be different from their Western counterparts. This paper reports an interpretive comparison of Chinese and U.K. construction project managers’ conceptions of their work. The findings reveal three of the most similar and five of the most different aspects between the two cultural sets of conceptions. The identified similarities reflect some key characteristics inherent in the construction project management profession. Two of the identified differences, namely Chinese emphasis on commercial awareness and U.K. emphasis on health and safety, arise from social structural differences in the two nations, whereas the other three differences, namely Chinese attention to relationships, Chinese concern for their company, and U.K. attention to project contract, are due to the cultural differences between the two nations.     

Automated Generation of Customized Field Data Collection Templates to Support Information Needs of Cost Estimators

While estimating activity production rates, cost estimators rely on historical production rates. To have realistic and useful cost estimates based on historical production rates, such production rate data should be augmented with historical contextual information that depict conditions under which activity production rates were achieved in past projects. This information is needed in determining which production rate to use among alternates for a similar activity existing in a new bid. Estimators need contextual information especially when they are unfamiliar with the work being estimated. Hence, such information items need to be identified, collected, and stored for estimators’ use in new projects. This paper details a construction-method specific and an extensible approach that is developed for enabling cost estimators to define contextual information items that need to be collected on job sites and stored as part of project histories. Based on this approach, the writers implemented a prototype system, called as ContextGen, and performed user-tests with estimators with different experience levels. Results showed that the developed approach captures method-specific information needs of estimators and is extensible to incorporate new contextual information items that can have different data representations. The developed approach is also precise in retrieving contextual information items specific to a construction method from a set of predefined contextual information items available in a library.     

浅谈项目成本管理

项目成本管理是项目管理的核心组成部分,贯穿项目发展的整个过程。随着国内建筑市场与国际接轨,建筑承包市场竞争愈来愈激烈,项目成本管理的作用也越来越明显,企业要想提升自己的竞争力,需要与时俱进,学习国外先进的项目成本管理模式,逐步完善项目成本管理体系。     

Resource Optimization Using Combined Simulation and Genetic Algorithms

This paper presents a new approach for resource optimization by combining a flow-chart based simulation tool with a powerful genetic optimization procedure. The proposed approach determines the least costly, and most productive, amount of resources that achieve the highest benefit/cost ratio in individual construction operations. To further incorporate resource optimization into construction planning, various genetic algorithms (GA)-optimized simulation models are integrated with commonly used project management software. Accordingly, these models are activated from within the scheduling software to optimize the plan. The result is a hierarchical work-breakdown-structure tied to GA-optimized simulation models. Various optimization experiments with a prototype system on two case studies revealed its ability to optimize resources within the real-life constraints set in the simulation models. The prototype is easy to use and can be used on large size projects. Based on this research, computer simulation and genetic algorithms can be an effective combination with great potential for improving productivity and saving construction time and cost.