Evaluation of Project Delivery Methods (2009)

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TCRP G-08 – Project Delivery Methods Executive Summary EXECUTIVE SUMMARY Objective The objective of this research was to conduct a comprehensive study of the benefits and disadvantages of various project delivery methods for transit projects and to develop guidelines for selecting the most appropriate delivery method for a specific project. A variety of project delivery methods is available to the developers of public projects in the United States. While the traditional design-bid-build remains the most common method for project delivery, there is considerable interest on the part of transportation agencies in alternative forms of project delivery and their potential benefits. The outcome of this research is culminated in a guidebook that can be used by transit agencies for choosing the best delivery method for their projects. The guidebook is an easy- to-use document that is prepared using the most up-to-date literature on the topic and the experience of several transit project directors that were interviewed for this purpose. It is recommended that transit agencies use industry professionals from outside the agency to facilitate the implementation of this methodology. The use of such professionals will ensure that the appropriate expertise and experience is incorporated into the process. The project delivery method is the process by which a construction project is comprehensively designed and constructed for an owner including project scope definition, organization of designers, constructors and various consultants, sequencing of design and construction operations, execution of design and construction, and closeout and start-up. With the rapid change in procurement laws, public agencies now share the ability of their private sector counterparts to acquire construction services via alternative project delivery methods, such as construction management, design-build, and other hybrid systems. In some instances some of these methods, such as design-build may include operations and maintenance as well as multi-year warrantees in the contract. Research Methodology The approach in developing the project delivery method selection framework was to review and analyze relevant literature on project delivery methods and previous work in developing decision support systems for project delivery selection. In addition, an extensive questionnaire was developed for a face-to-face structured interview with several transit agencies. The authors traveled to five selected project sites across the United States, interviewed project directors, and collected data on nine major transit projects. The results of the interviews were then analyzed and summarized in great detail. Transit agencies’ concerns, practices, limitations, and goals were studied and the effect of these factors on the choice of delivery method was studied. Based on the outcome of the literature search and the structured interviews, a set of pertinent issues were identified and studied. These pertinent issues were factors that were thought to have profound effect on the choice of project delivery method. These factors in turn were used to develop the project delivery method selection framework described in this guidebook. Northeastern University The Research Report 1

TCRP G-08 – Project Delivery Methods Executive Summary Northeastern University The Research Report 2 Selection System Framework The selection of the project delivery method is a decision that is based on a multitude of factors. In this effort, these factors are called pertinent issues and have been categorized according to the following: project-level issues, agency-level issues, public policy/regulatory issues, life cycle issues, and other issues. The research team has identified and verified these pertinent issues through literature search, extensive interviews with various transit agencies across the United States, and discussions among project team and the project oversight panel. Based on these pertinent issues, the team has developed a 3-tiered project delivery selection system that consists of the following tiers: Tier 1 – Analytical Approach Tier 2 – Weighted Matrix Approach Tier 3 – Optimal Risk-based Approach The Tier 1 Analytical Approach provides a framework for agencies to define project goals and examine the advantages and disadvantages of each delivery method within the context of these goals. The motivation for this approach is to help agencies understand project delivery method attributes and to determine if their specific project goals align with the attributes of a particular delivery method. The Tier 1 approach also provides a “go/no go” review to determine if one or more project delivery methods should be excluded from the examination. At the completion of Tier 1, the agency may not have a single, clear and logical choice for a project delivery method. If this is the case, the agency will be advised to move to the Tier 2 selection process with the best delivery method options and create a more detailed analysis to select the final project delivery method. The Tier 2 Weighted-Matrix Approach provides a means for the agency to further examine and document a project delivery decision for an individual project. In case an obvious choice was not found in the Tier 1 Analytical Approach, the Tier 2 approach provides the agency with a process to select a delivery method by prioritizing project objectives and selecting the delivery method that best aligns with these objectives. In tier 2 the user concentrates on a few key parameters that affect the choice of project delivery method, assign appropriate weights to each parameter and calculate a score for each competing delivery method. The process of selecting each parameter and assigning the proper weight is described in sufficient detail. The Tier 3 Optimal Risk-based Approach will leverage the current cutting-edge risk-based cost estimating methods that have emerged in transit and highway agencies in the past few years. It is expected that the delivery method decision be made by completing the tiers 1 and 2. Tier 3 will only be applied when a decision is not apparent after completing Tiers 1 and 2, and when a formal risk management process for the project is already in place. It is important to note that the level of effort involved in using Tier 3 (especially the quantitative approach) is considerably larger than either Tier 1 or Tier 2. Regardless of how many tiers an agency uses to arrive at a project delivery method selection decision, the framework forces the decision-makers to document their logic as they proceed through the process. This aspect will prove especially helpful as agencies can use these documented decisions in future projects. It is the authors’ belief that the guidebook, which was the main deliverable of this research, is a comprehensive resource for helping transit agencies to select the most appropriate project delivery method and to document their decision in a concise and easy to understand format.