Effective Project Scoping Practices to Improve On-Time and On-Budget Delivery of Highway Projects (2016)

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N A T I O N A L C O O P E R A T I V E H I G H W A Y R E S E A R C H P R O G R A M NCHRP REPORT 821 Effective Project Scoping Practices to Improve On-Time and On-Budget Delivery of Highway Projects Stuart Anderson Cesar Quiroga John Overman Kunhee Choi Jayant Sahu Sharareh Kermanshachi Texas a&M TransporTaTion insTiTuTe College Station, TX Paul Goodrum universiTy of Colorado Boulder, CO Timothy Taylor Ying Li KenTuCKy TransporTaTion CenTer Lexington, KY Subscriber Categories Highways • Design • Planning and Forecasting TRANSPORTAT ION RESEARCH BOARD WASHINGTON, D.C. 2016 www.TRB.org Research sponsored by the American Association of State Highway and Transportation Officials in cooperation with the Federal Highway Administration

NATIONAL COOPERATIVE HIGHWAY RESEARCH PROGRAM Systematic, well-designed research is the most effective way to solve many problems facing highway administrators and engineers. Often, highway problems are of local interest and can best be studied by highway departments individually or in cooperation with their state universities and others. However, the accelerating growth of highway transportation results in increasingly complex problems of wide inter- est to highway authorities. These problems are best studied through a coordinated program of cooperative research. Recognizing this need, the leadership of the American Association of State Highway and Transportation Officials (AASHTO) in 1962 ini- tiated an objective national highway research program using modern scientific techniques—the National Cooperative Highway Research Program (NCHRP). NCHRP is supported on a continuing basis by funds from participating member states of AASHTO and receives the full cooperation and support of the Federal Highway Administration, United States Department of Transportation. The Transportation Research Board (TRB) of the National Academies of Sciences, Engineering, and Medicine was requested by AASHTO to administer the research program because of TRB’s recognized objectivity and understanding of modern research practices. TRB is uniquely suited for this purpose for many reasons: TRB maintains an extensive com- mittee structure from which authorities on any highway transportation subject may be drawn; TRB possesses avenues of communications and cooperation with federal, state, and local governmental agencies, univer- sities, and industry; TRB’s relationship to the Academies is an insurance of objectivity; and TRB maintains a full-time staff of specialists in high- way transportation matters to bring the findings of research directly to those in a position to use them. The program is developed on the basis of research needs identified by chief administrators and other staff of the highway and transporta- tion departments and by committees of AASHTO. Topics of the highest merit are selected by the AASHTO Standing Committee on Research (SCOR), and each year SCOR’s recommendations are proposed to the AASHTO Board of Directors and the Academies. Research projects to address these topics are defined by NCHRP, and qualified research agencies are selected from submitted proposals. Administration and surveillance of research contracts are the responsibilities of the Acad- emies and TRB. The needs for highway research are many, and NCHRP can make significant contributions to solving highway transportation problems of mutual concern to many responsible groups. The program, however, is intended to complement, rather than to substitute for or duplicate, other highway research programs. Published reports of the NATIONAL COOPERATIVE HIGHWAY RESEARCH PROGRAM are available from Transportation Research Board Business Office 500 Fifth Street, NW Washington, DC 20001 and can be ordered through the Internet by going to http://www.national-academies.org and then searching for TRB Printed in the United States of America NCHRP REPORT 821 Project 08-88 ISSN 0077-5614 ISBN 978-0-309-37510-8 Library of Congress Control Number 2016935219 © 2016 National Academy of Sciences. All rights reserved. COPYRIGHT INFORMATION Authors herein are responsible for the authenticity of their materials and for obtaining written permissions from publishers or persons who own the copyright to any previously published or copyrighted material used herein. Cooperative Research Programs (CRP) grants permission to reproduce material in this publication for classroom and not-for-profit purposes. Permission is given with the understanding that none of the material will be used to imply TRB, AASHTO, FAA, FHWA, FMCSA, FRA, FTA, Office of the Assistant Secretary for Research and Technology, PHMSA, or TDC endorsement of a particular product, method, or practice. It is expected that those reproducing the material in this document for educational and not-for-profit uses will give appropriate acknowledgment of the source of any reprinted or reproduced material. For other uses of the material, request permission from CRP. NOTICE The report was reviewed by the technical panel and accepted for publication according to procedures established and overseen by the Transportation Research Board and approved by the National Academies of Sciences, Engineering, and Medicine. The opinions and conclusions expressed or implied in this report are those of the researchers who performed the research and are not necessarily those of the Transportation Research Board; the National Academies of Sciences, Engineering, and Medicine; or the program sponsors. The Transportation Research Board; the National Academies of Sciences, Engineering, and Medicine; and the sponsors of the National Cooperative Highway Research Program do not endorse products or manufacturers. Trade or manufacturers’ names appear herein solely because they are considered essential to the object of the report.

The National Academy of Sciences was established in 1863 by an Act of Congress, signed by President Lincoln, as a private, non- governmental institution to advise the nation on issues related to science and technology. Members are elected by their peers for outstanding contributions to research. Dr. Ralph J. Cicerone is president. The National Academy of Engineering was established in 1964 under the charter of the National Academy of Sciences to bring the practices of engineering to advising the nation. Members are elected by their peers for extraordinary contributions to engineering. Dr. C. D. Mote, Jr., is president. The National Academy of Medicine (formerly the Institute of Medicine) was established in 1970 under the charter of the National Academy of Sciences to advise the nation on medical and health issues. Members are elected by their peers for distinguished contributions to medicine and health. Dr. Victor J. Dzau is president. The three Academies work together as the National Academies of Sciences, Engineering, and Medicine to provide independent, objective analysis and advice to the nation and conduct other activities to solve complex problems and inform public policy decisions. The Academies also encourage education and research, recognize outstanding contributions to knowledge, and increase public understanding in matters of science, engineering, and medicine. Learn more about the National Academies of Sciences, Engineering, and Medicine at www.national-academies.org. The Transportation Research Board is one of seven major programs of the National Academies of Sciences, Engineering, and Medicine. The mission of the Transportation Research Board is to increase the benefits that transportation contributes to society by providing leadership in transportation innovation and progress through research and information exchange, conducted within a setting that is objective, interdisciplinary, and multimodal. The Board’s varied committees, task forces, and panels annually engage about 7,000 engineers, scientists, and other transportation researchers and practitioners from the public and private sectors and academia, all of whom contribute their expertise in the public interest. The program is supported by state transportation departments, federal agencies including the component administrations of the U.S. Department of Transportation, and other organizations and individuals interested in the development of transportation. Learn more about the Transportation Research Board at www.TRB.org.

C O O P E R A T I V E R E S E A R C H P R O G R A M S CRP STAFF FOR NCHRP REPORT 821 Christopher W. Jenks, Director, Cooperative Research Programs Christopher J. Hedges, Manager, National Cooperative Highway Research Program Lori L. Sundstrom, Senior Program Officer Danna Powell, Senior Program Assistant Eileen P. Delaney, Director of Publications Margaret B. Hagood, Editor NCHRP PROjECT 08-88 PANEL Field of Transportation Planning—Area of Forecasting David V. Rettig, New York State DOT, Albany, NY (Chair) Connie Porter Betts, Louisiana DOTD, Baton Rouge, LA Marlon A. Flournoy, California DOT, Sacramento, CA Michael T. Ginnaty, Minnesota DOT, Detroit Lakes, MN Wilfred Hernandez, Rhode Island DOT, Exeter, RI Michael R. Kies, Arizona DOT, Phoenix, AZ Virginia Mabry, North Carolina DOT, Raleigh, NC Walter Jeffery Moore, Kentucky Transportation Cabinet, Bowling Green, KY Tyler R. Yorgason, Jacobs, Salt Lake City, UT D. Scott Wolf, FHWA Liaison Kimberly Fisher, TRB Liaison

NCHRP Report 821: Effective Project Scoping Practices to Improve On-Time and On-Budget Delivery of Highway Projects is a guidebook that demonstrates how a state department of transportation (state DOT) can improve its scoping process and practices to produce a project cost estimate and schedule that facilitate programming decision making and accountability. The guidebook illustrates the effort needed to develop a robust cost estimate and then man- age to a baseline budget and scope throughout the project delivery cycle. The guidebook is applicable to a range of project types and is scalable in its ability to accommodate projects of varying complexity. The guidebook should be of immediate use to DOT senior managers and staff who are responsible for developing project cost estimates for statewide transportation improvement plans and for managing the cost and scope of projects during project delivery. Transportation agencies have significantly improved many aspects of project delivery, yet they continue to be challenged by cost increases and time delays that occur after a project is programmed and funded. Increasing or otherwise changing the scope of a project to improve facility performance is a common source of cost increases and schedule delays, as is failure to adequately consider project impacts on utilities, communities, or the environment. While evaluating and accommodating risk are essential and ongoing activities throughout the proj- ect development process, the negative impacts that scope growth and related problems can have on a highway project’s cost and schedule can be minimized if these problems are identified and mitigated early in project development. Industrial and commercial building construction sectors have experienced similar prob- lems with construction project scope growth, cost increases, and time delays that occur after a project has been authorized for detailed design and construction. Recent research in these sectors has produced a structured and systematic process to help owners meet project cost and schedule objectives by defining a project to a suitable level of development prior to authorization of detailed design. Statistical evidence indicates that earlier and more detailed scoping efforts can reduce total design and construction cost by as much as 20%, and shorten total design and construction schedules by as much as 39%. Such scoping pro- cesses, with supporting indices and tools to calibrate the level of scoping effort required to achieve these results, have become standard procedures that many private U.S. corporations use in their capital facilities development efforts. With modifications, these processes and tools may be transferable to the transportation industry. Transportation projects that are programmed before they are well defined have a greater risk of increased project cost and/or schedule delays. Because transportation funding is constrained, cost overruns on one project can mean that funding for other projects is F O R E W O R D By Lori L. Sundstrom Staff Officer Transportation Research Board

reduced or even eliminated. These outcomes can have negative repercussions for trans- portation agency relationships with the public and legislative bodies. Recognizing that project delivery performance can be improved by using more sophisticated scoping and programming processes tailored to the type of project, a number of state DOTs have modified their scoping processes with varying degrees of success. Under NCHRP Project 08-88, the Texas A&M Transportation Institute was asked to (1) develop a literature review; (2) identify the state of practice in state DOTs and in related industries; (3) define the scoping process; (4) identify the optimum level of project develop- ment needed to establish a baseline scope, cost, and schedule for programming and man- agement purposes; and (5) provide a guidebook that is both comprehensive and scalable.