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82 A Guidebook for the Evaluation of Project Delivery Methods To achieve the weighted ranking, owners should do the following: · Rank the selection factors in order from highest to lowest with regard to their influence on project success. · Include a minimum of four and a maximum of seven factors. Remove factors not ranked in the top seven. · Using 100 total points, weight the factors according to their influence on project success. Avoid equal weighting of factors. Remove any factors with a value of less than 5 of the 100 points and redistribute points. These three steps describe a simple method for achieving a weighted ranking of the selection factors. Decision sciences provide more precise methods for achieving weighted rankings and developing a consensus. Appendix F (available on the TRB website at http://trb.org/news/ blurb_detail.asp?id=10054) provides descriptions of the following methods to achieve more precise weighted rankings: · The Delphi Method, · Rank Order Centroid, · The Ratio Method, and · Pairwise Comparison. The result of Step 2 will be a weighted ranking of up to seven selection factors. The weightings should total 100 points. Equal factor weightings are not recommended because distinguishing the importance between factors (goals and pertinent issues) is necessary for the decision process. Additionally, no single factor should have a point value of less than five because a point value that low will not influence the final decision and may in fact make the selection more difficult. Steps 3, 4, and 5 involve combining the weighted ranking of the selection factors with a scoring of the project delivery methods to arrive at the selection of the most appropriate delivery method. Delivery Selection for the Example Project--Step 2. Table 5.1 shows how weighted ranking worked in the example project. In Table 5.1, selection factors for the example project have been weighted to reflect their influence on the success of the example project's delivery. These weight- ings are project dependent and should be agreed upon by key owner team members. Step 3. Score Project Delivery Methods The third step involves a scoring of the alternative delivery methods from the Tier 1 analysis. Each of these delivery methods will have a bearing or influence on the selection factors, which stem from the project goals and pertinent issues. The key decision makers must translate this influence into a score to arrive at a decision. To achieve the total scores for each delivery method, owners do the following: Table 5.1. Weighted ranking of selection factors for the example project. Weight Selection Factor 50 Project complete by November 1, 20XX. 25 Cost not to exceed $1.5 billion. 15 Environment enhanced through less traffic congestion and pollution. 10 Staffing requirements minimized during design and construction. 100 Total
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Tier 2--Weighted-Matrix Delivery Decision Approach 83 · Using the scale given in Table 5.2, assign a score to each delivery method that represents its influence or bearing on each selection factor. Score all delivery methods for each factor before moving to the next factor. · Repeat the previous step for each selection factor. · When all of the delivery methods have been scored, multiply each delivery method's factor weight by its score to achieve a weighted score for each delivery method. · Sum all of the weighted scores to arrive at a total score for each delivery method. Table 5.2 provides a scale for scoring each delivery method's bearing on each selection factor. The scores range from 1 to 10 so that when they are multiplied by the factor weight, the total score will range from 0 to 1,000. The scores are subjective, so a detailed definition for each numerical score is provided adjacent to the score in Table 5.2. When scoring the delivery methods, owners should discuss the advantages and disadvantages of each delivery method (see Chapter 3 and Step 4 of Tier 1). The alignment of these advantages and disadvantages with the selection factors forms the basis for the scoring. In assigning the scores, the owner should work in a team to come to a decision by consensus. The reasons for each individual score should also be carefully doc- umented. Consideration should also be given to the relative scores for each delivery method to ensure consistency. Like the development of factor weights, scoring project delivery methods can be done most simply through a group discussion among key decision makers from the owner's team. If a more precise scoring is desired, one of the decision techniques described in Appendix F can be used. Table 5.3 provides a weighted decision matrix template. The matrix can contain up to four delivery methods, depending upon the results of Tier 1. The matrix can also contain up to seven selection factors for each project. The result of Step 3 will be a scored ranking of the delivery methods in question. The delivery method with the highest total score will be the most appro- priate method for the given project. The next steps involve documenting the individual scores, making a decision, and creating a Project Delivery Selection Report. Delivery Selection for the Example Project--Step 3. Table 5.4 shows how an owner might score the project delivery methods for the example project. Note that only the CMR and DB project delivery methods made it through the Tier 1 filter for further consideration in Tier 2. Also note that the scores are project dependent and will certainly change from project to project. Table 5.2. Project delivery scoring scale (adapted from Saaty 1990). Score Definition 10 The evidence that the delivery method positively aligns with the project objective or issue is of the highest possible order of affirmation. 8 The delivery method strongly aligns with the objective or issue and is demonstrated in practice. There is a slight risk that the objective or issue may not be beneficial. 6 Experience and judgment point to the delivery method strongly aligning with the objective or issue. There is a mild risk that the objective may not be beneficial. 4 Experience and judgment point slightly to the delivery method aligning with the objective or issue. There is a strong risk that the objective will be negatively affected. 2 There is little benefit to applying the delivery method for this goal or objective. There is a strong likelihood that the object will not be achieved. 9,7,5,3,1 Intermediate values between two adjacent judgments.
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84 A Guidebook for the Evaluation of Project Delivery Methods Table 5.3. Weighted-matrix template. Project Delivery Method DBB CMR DB DBOM Selection Factor Weighted Weighted Weighted Weighted Score Score Score Score Factor Weight Score Score Score Score Factor 1 (e.g., Project Goals) Factor 2 (e.g., Agency experience) Factor 3 (e.g., Market issues) Factors 4 to 7 ... Total Score Explanations of the scores for the project delivery methods for the example project are the fol- lowing: · Project completion factor. The project completion factor relates to a project goal. In this case, the project has a fixed end date of November 1, 20XX. The owner believes that CMR delivery can achieve the completion date. The owner also believes that CMR will require the use of multiple bid packages to achieve the schedule, which adds a risk for meeting the schedule date, so CMR = 6 (in this case). DB delivery provides for a single entity to coordinate design and construction. DB also allows for an owner to specify a fixed end date in the procurement doc- uments and the contract. According to what has been demonstrated in practice, the owner is confident that the end date can be achieved through a DB delivery, so DB = 8 (in this case). · Cost containment factor. The cost containment factor relates to a project goal. The project has a maximum budget of $1.5 billion. Practice has shown that with DB a fixed price can be set early in the project development process. It has also been demonstrated that DB provides the lowest average cost growth of the two methods in question, so DB = 8 (in this case). CMR also provides the ability to meet a fixed price, but the owner is not as confident with the expe- rience using a GMP contract structure. The owner also feels that there is more risk with CMR of not achieving the schedule than with DB, so CMR = 6 (in this case). Table 5.4. Weighted matrix for example project. Project Delivery Method CMR DB Factor Weighted Weighted Selection Factors Score Score Weight Score Score Project complete by November 1, 20XX 50 6 300 8 400 Cost not to exceed $1.5 billion 25 6 150 8 200 Environment enhanced through less 15 10 150 6 90 traffic congestion and pollution Staffing requirements minimized during 10 8 80 6 60 design and construction Total Score 100 680 750