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APPENDIX B Definitions Agency CM: Agency CM is a professional service where the CM acts as the owner's agent in man- aging the construction project. Its role is consultative and the CM is usually not at risk for the cost and schedule of building the project. Analytical Delivery Decision Approach: It is a method of project delivery selection that examines the advantages and disadvantages of various project delivery methods to arrive at an appropriate method for an individual project. In this guidebook, this method is Tier 1 of the proposed Proj- ect Delivery Selection System. Best-value Procurement System: A procurement process where price and other key factors are considered in the evaluation and selection process to minimize impacts and enhance the long- term performance and value of construction. Construction Manager-at-Risk (CMR) or CM/GC: In this guidebook, CMR and CM/GC are equivalent terms. The owner holds two separate contracts with the construction manager (sometimes referred to as General Contractor) and the designer of the project. The CMR is cho- sen based on criteria other than just the lowest construction cost, such as qualifications and past performance. In this delivery method, the CMR is held to a guaranteed maximum price (GMP). The CMR typically provides constructability, cost, schedule, and value engineering input during the project design phase. Constructor: The constructor is the entity that contracts with the project owner to execute the construction phase of the project. In the Design-Build approach, the constructor is also respon- sible for the final design. Design-Bid-Build (DBB): This is the traditional method of delivering a project in which design and construction are contracted with two separate entities. Design-Build (DB): Design-Build is a project delivery method in which the owner procures both design and construction services in the same contract from a single legal entity referred to as the design-builder. Design-Build-Operate-Maintain (DBOM): In this delivery method the owner contracts out the design and construction as well as the operation and maintenance of the project to a sin- gle entity. Decision Factor: A variable in the Weighted Decision Matrix (Tier 2 of the proposed Project Delivery Selection System) that is derived from the project goals and pertinent issues to aid in the project delivery method decision is referred to as a decision factor. Go/No-Go Decision Points: A pertinent issue or decision point that excludes a project delivery method from further consideration is called a Go/No-Go Decision Point. 99
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100 A Guidebook for the Evaluation of Project Delivery Methods Guaranteed Maximum Price (GMP): A price mechanism in which the owner is committed to reimburse the project costs up to a predetermined ceiling. Any cost overrun above that ceiling is a risk that the constructor takes. Pertinent Issues: The term pertinent issue refers to 24 pertinent issues identified and explained in this guidebook that influence the selection of the project delivery method. Probabilistic Risk Analysis: This is a systematic approach for evaluating the severity and likeli- hood of project risks. The results of Probabilistic Risk Analysis are expressed in terms of proba- bility distributions and ranges for project cost or project duration. Project Delivery Decision Report: This is an archival report that communicates and justifies an individual project delivery decision to interested stakeholders. Project Delivery Method: The project delivery method (or project delivery system) is the process by which a construction project is comprehensively designed and constructed for an owner. It refers to all the contractual relations, roles, and responsibilities of the entities involved in a project. Project Delivery Selection System: This is the decision support system developed in this guide- book consisting of three tiers (analytical, weighted-matrix and risk-based) to help transit agencies select the most suitable delivery method for their projects. Project Goals: Project goals are statements of technical or performance objectives that commu- nicate the importance of project issues such as time, cost, quality, maintainability, and sustain- ability. Project Lifecycle: Project lifecycle is the duration of a project, starting at project germination and including project conceptual, preliminary, and detailed design as well as the procurement and construction phases. It ends by the end of project operation and maintenance phase. Project Stakeholder: Any individual or entity that has an interest in a project that may be directly involved in the project (e.g., the designer or contractor) or be affected by the project completion (e.g., communities or business owners adjacent to transit corridor) is a project stakeholder. Qualitative Risk Approach: In this guidebook, a qualitative risk analysis approach is an approach where major project risks are identified and allocated to the parties best able to bear them. Risk identification and a risk-allocation matrix are the outcomes of this approach. Quantitative Risk Approach: A risk analysis approach in which the project risks are quantified in terms of ranges and probability of occurrence is called quantitative risk approach. This approach usually applies various probabilistic models to arrive at a probability distribution for the parameter under study (e.g., project cost). Risk-allocation Matrix: It is a tool used by risk analysts to assign major project risks to various entities based on the contractual mechanisms that determine project risk distribution. Risk Allocation: Assigning a risk to a party in a design or construction contract. Risk Factors: Risk factors are events that may have an adverse impact on project cost and sched- ule. Examples of risk factors may be the risk involved in utility relocation, latent underground conditions, inflation, etc. Risk Management: All of the steps associated with managing risks, including risk identification, risk assessment, risk allocation and mitigation, risk monitoring and control. Weighted Decision Matrix: This is a decision process that organizes Decision Factors in the rows of a matrix, and project delivery methods in the columns to structure a project delivery method decision. The Decision Factors are weighted by their importance to the project goals and scored by their alignment with each project delivery method. The weighted decision factors are summed up for each project delivery method for making the final decision.