1. Project Delivery and Contract Strategy (PDCS)
Research Team
Gary Vandiver
Solutia
CII Annual Conference 2001

2. PDCS Research Team Stuart D. Anderson Texas A&M Stanley F. Berger 3M
G. Wayne Burchette Eastman Chemical, Chairman
James R. Greene Abbott Labs
Robert P. Kehoe NASA
Larry Kruse Murphy Company
Ade Oyetunji Texas A&M
Tim Thury GSA
Gary Vandiver Solutia
Paul Wicker GM
Past Members
Darrick D. Bowers Texas A&M
David Combs John Gray
Richard De Leon, Jr. UT System
Jerry Kirk FPL
John Phillips U.S. Steel, former Chairman
Janice White UT System
John Wrockloff U.S. Air Force

3. Team Mission Statement
To produce a process to assist in selecting a contract delivery strategy to optimize owner's project objectives.

4. 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.

5. PDCS
The research team developed a procedure and tool to assist in selection of Project Delivery and Contract Strategy.

6. PDCS Procedure Focuses on owner’s project objectives.
Focuses on project execution environment.
Incorporates quantitative assessment of PDCS alternatives in decision support tool.

7. Research Research conducted with: CII members, non-members
Owners and contractors
Public agencies
Industrial and general building sectors

8. PDCS Definition
Defines roles and responsibilities of parties in a project.
Defines how owner pays for services.
Establishes framework for organization of project execution.

9. PDCS – Typical Representation
Bid
Traditional Design-Bid-Build delivery system, PDCS 01
Phase Sequence: Serial sequence of design and construction
(Procurement begins with construction)
Design
Procure
Construct
Project Team Relationships
Primary Contractual/Functional Relationships
Owner
Designer
Constructor
Compensation Approaches
Designer: Firm Price
Constructor: Competitive Lump Sum

10. 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.

11. 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.

12. 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

13. 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.

14. Data Collection and Validation
Phase II – Workshops involving 32 owner and contractor project managers:
Developed relative effectiveness scores that are intrinsic to spreadsheet analysis.

15. 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.

16. Data Collection and Validation
Result obtained was appropriate.
Procedure and tool are improvement over current practices.
Insight into selection of PDCS provided.

17. PDCS Decision Support Tool
PROCESS FLOWCHART
Start
End
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.
Review Default Compensation Approaches
Refine Compensation Approaches
Yes No
Default Compensation Approaches Okay?
Make Decision
Review project objectives.
Identify selection factors (related to owner’s project objectives).
Assign preference rank and preference weights to selected factors to reflect priority.

18. PDCS Decision Support Tool (continued)
PROCESS FLOWCHART
Start
End
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.
Review Default Compensation Approaches
Refine Compensation Approaches
Yes No
Default Compensation Approaches Okay?
Make Decision
Paste effectiveness values into aggregate table.
Obtain aggregate scores from spreadsheet.
Review results to make final decision.
Choose from 20 selection factors, 12 PDCS alternatives.

19. PDCS Decision Support Tool
Factor Selection Factor Description Factor Action Number Factor for Comparing Statement
1 Completion within Delivery system Control cost growth original budget is facilitates control of critical to project cost growth success
7 Early completion is Delivery system Ensure shortest critical to project ensures shortest schedule success reasonable schedule
17 Project features are Delivery system Capitalize on well defined at the capitalizes on well well defined scope award of the design defined project and/or construction scope prior to award contract of design and/or construction
Examples 3-4 selection factors
Highlight quality, cost , schedule
Detail discussion/review at Implement Session
Example PDCS

20. PDCS Decision Support Tool
Table A-1: Compute Preference Weights
Factor Action Statement Preference Preference Normalized
Rank Scores Preference Weight
Control time growth
Protect confidentiality
Capitalize on familiar project conditions
Maximize owner's involvement
Efficiently coordinate project complexity or innovation
300

21. PDCS Decision Support Tool
Table A-2: Compute Aggregate Scores
Factor
Control time
growth
Protect
confidentiality
Capitalize on
familiar
project
conditions
Maximize
owner's
involvement
Coordinate
complexity or
innovation
EMPTY
Preference
Weight
0.33
0.27
0.20
0.13
0.07
0.00
PDCS 01 20 90 80 70
46.00
PDCS 02 50 60
66.67
PDCS 03
39.33
PDCS 04 40
38.67
PDCS 05
56.67
PDCS 06
66.00
PDCS 07
100 10
58.00
PDCS 08 30
64.67
PDCS 09
56.00
PDCS 10
22.00
PDCS 11
59.33
PDCS 12
80.67
PDCS
Alternatives
Aggregate
Score
Predetermined Effectiveness Values
(Table EV-1)

22. 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.

23. Benefits of the Tool
Provides rationale for selecting PDCS, based on quantification of alternatives.
Supports CII Best Practices:
Alignment
Pre-Project Planning

24. PDCS Implementation Session
LOWEST
COST
SHORTEST
SCHEDULE
MAXIMIZE
CONTROL
LOW LEVEL OF
CHANGES

25. PDCS – Implementation Session
Moderator
Wayne Burchette Eastman Chemical
Panel
Stu Anderson Texas A&M University
Stan Berger 3M Company
Larry Kruse Murphy Company
Ade Oyetunji Texas A&M University
Paul Wicker General Motors Company