Reasons for Cost and Schedule Increase for Engineering Design Projects
Andrew Shing-Tao Chang, P.E., M.ASCE
1Abstract:
Cost and schedule increases are common in engineering design projects. Some research has studied factors associated with better design performance, but the reasons for cost and schedule increases are not formally investigated. This paper identifies the reasons bottom up from four case project documents and further quantifies their contributions to cost and schedule increases. These reasons are complete and can be used to analyze the cause-effect relationship, trace responsibility, and improve performance for engineering design projects.
DOI:
10.1061/共ASCE兲0742-597X共2002兲18:1共29兲
CE Database keywords:
Design; Cost; Scheduling; Project management.
Introduction
Engineering design has high level of influence on project costs
共Barrie and Paulson 1992兲. However, design performance is usu-ally not satisfactory. A survey reveals that about one third of architectural/engineering
共A/E兲 projects miss cost and scheduletargets
共Anderson and Tucker 1994兲. There have been few in-stances where an engineering design was so complete that a project could be built to the exact specifications contained in the original design documents
共Smith 1996兲. Many constructionproblems are due to design defects and can be traced back to the design process
共Bramble and Cipollini 1995兲.Some studies have identified factors that influence design per- formance. Tucker and Scarlett
共1986兲 proposed seven criteria forevaluating design performance, including accuracy, design economy, and constructability. Chalabi et al.
共1986兲 listed 10input variables with a major impact on design effectiveness, such as scope definition and owner participation. Alarcon and Ashley
共1992兲 identified that organization, incentive plans, and teambuilding have high positive impact on design performance. San- vido et al.
共1992兲 identified four critical success factors includingfacility team and contracts for designing commercial building projects. Anderson and Tucker
共1994兲 found that the use of bestproject management
共PM兲 practices is associated with better per-formance of A/E projects. Sternbach
共1988兲 stated that the pro-cess variables causing A/E project delays are extra work beyond the original scope of agreement, failure of the owner or its other consultants to provide information, and objections by environ- mental or community groups.
The above studies have discussed factors associated with de- sign performance. But the causes or reasons for inadequate cost/
schedule performance are not formally investigated. This paper identifies the reasons for cost/schedule increases and quantifies their contributions by case studies. Case studies are useful when investigating human errors in complicated processes, such as structural design
共Blockley et al. 1986兲. Qualitative analysisthrough case studies is particularly useful for investigating why a relationship exists
共Eisenhardt 1989兲.Reasons Identified from Project Documents
Four completed projects were studied as cases. They were envi- ronmental and engineering design services for roadway construc- tion projects in California. All four cost-plus-fixed-fee projects experienced cost and schedule increases to a certain extent
共Table1
兲. Cost increased on an average of 24.8%, and schedule in-creased on an average of 69%, based on the four sampled projects.
Amendments are official changes of costs and/or schedules in the contract. In the owner’s internal process, the reasons for changes have to be stated and attached as a backup when request- ing an amendment. After the amendment is approved, a formal amendment stating the new work scope, cost, and time will be signed by the owner and consultant. There are some changes without amendments, such as an interim time adjustment allowed by the owner during the project.
There were about 30 formal and informal changes in the four reviewed amendment backup documents and project files. Each amendment or change included several subchanges and each sub- change included several explanations. More than 100 explana- tions were found. These explanations in the amendment backup documents were prepared by the owner; sometimes the consult- ant’s statements were attached. Those in the project files came from the consultant’s letters or other correspondence.
When an amendment was analyzed in this research, the pre- liminary reasons for changes were first identified against the ex- planations written in the amendment backup documents. Then the relevant letters and correspondence in the project files were fur- ther reviewed to modify or confirm these reasons. The following statements are typical explanations found, listed in the parenthe- ses are the proposed reasons against the explanations.
From amendment backup documents:
1Associate Professor, Dept. of Civil Engineering, National Cheng Kung Univ., Tainan, Taiwan. E-mail: anschang@mail.ncku.edu.tw
Note. Discussion open until June 1, 2002. Separate discussions must be submitted for individual papers. To extend the closing date by one month, a written request must be filed with the ASCE Managing Editor.
The manuscript for this paper was submitted for review and possible publication on November 13, 2000; approved on May 11, 2001. This paper is part of the Journal of Management in Engineering, Vol. 18, No.
1, January 1, 2002. ©ASCE, ISSN 0742-597X/2002/1- 29–36/$8.00⫹$.50 per page.
• ‘‘Unanticipated efforts’’ or ‘‘increased level of effort than was originally anticipated for . . . ’’
共growing needs or owner’somission in the original scope兲;
• ‘‘Additional effort to complete . . . due to changes in Federal requirements’’
共standard change兲;• ‘‘Expanded level of effort in response to unanticipated public and agency comments’’
共stakeholders’ request兲;• ‘‘Update . . . analysis due to change in focus’’
共owner’s requestafter focus change兲;
• ‘‘Additional time due to contracting-out lawsuit’’
共lawchange兲;
• ‘‘Additional alternative studies requested by the affected com- munity’’
共stakeholders’ request兲;• ‘‘The original schedule is optimistic . . . ’’
共optimistic sched-ule兲, and
• ‘‘District did not have sufficient staff to do . . . ’’
共owner’s re-quest
兲.From project files, mostly from letters and memos:
• ‘‘The consultant had difficulty meeting with locals to get . . . needed’’
共consultant’s inability, and/or stakeholders兲;• ‘‘Additional costs to coordinate review, attend meetings’’
共growing needs, and/or consultant’s underestimate兲;
• ‘‘The actual scope of work was not well understood at the time the hours were originally estimated’’
共consultant’s omission兲;• ‘‘Underestimated coordination and effort’’
共consultant’s under-estimate兲;
• ‘‘The inability of
共other consultants兲 to meet the originalschedule has resulted in . . . ’’
共other consultants兲;• ‘‘Lack of data to perform analyses’’
共other consultants, theowner or stakeholders兲;
• ‘‘Addition of another alternative’’
共owner’s request兲; and• ‘‘Because . . . was not made available to you until . . . we con- cur with your revised proposed schedule’’
共owner’s failure toprovide information兲.
After all the statements were reviewed, analyzed, and com- pared, the final reasons for cost increases and schedule extensions became apparent. They were also confirmed by the owner’s project managers when interviewed. The final reasons are consis- tent with the findings by Sternbach
共1988兲 but are more detailedand insightful. The 10 reasons and their meanings are described as follows.
1. Owner’s request. The owner or its functional units request additional work or change focus/decision at a later date due to new findings and other considerations.
2. Optimistic schedule. The original schedule is overly opti- mistic and unrealistic, due to inaccurate estimates or politi- cal decisions.
3. Omissions-owner. Work that should have been included in the original scope is omitted by the owner.
4. Owner’s failure.
• The owner or its functional units fail to provide infor- mation, make decisions, or take actions in a timely man- ner.
• The information provided by the owner is incomplete or incorrect.
5. Other consultants. Consultants for other related projects fail to provide necessary information on time.
6. Consultant’s inability. The consultant is not effective or ef- ficient in performing the work, due to complicated work, insufficient staff, and/or lack of competent staff.
7. Omissions or underestimates—consultant. The actual scope of work is not well understood by the consultant at the time the work hours were originally estimated.
8. Growing needs. It is not anticipated at the scoping stage;
extra work or additional level of effort is needed after more studies, engineering, or design has been done. The work grows ‘‘naturally’’ without requests from the owner.
9. Stakeholders. Outside stakeholders, e.g., permitting agen- cies, community, etc., request more alternatives, investiga- tions, and/or explanations.
10. Others. Other reasons beyond the owner’s or consultant’s control exist, such as changes of laws or standards.
Originally, it was planned to separate the reasons for cost in- creases from those for time extensions. After preliminary catego- rization, it was found that the reasons for cost increases are nor- mally also the reasons for time extensions, because the increased work takes time to accomplish and vice versa. The optimistic schedule would seem a reason only for a time extension. But an optimistic schedule may force the consultant to accelerate work, which may cause additional costs.
A cost increase appeared as the first amendment in all four projects. The trend is that a cost increase is proposed in the early stage of a project and a time extension follows. This coincides with the impression that the consultant’s major concern is to make a profit
共Oglesby et al. 1989兲, and time is more flexible and canbe resolved later. If time is the owner’s main concern, every po- tential schedule change should be closely monitored when a cost change is proposed.
It was logical to anticipate that these reasons could be catego- rized according to responsibility. Reasons 1 to 5 are factors within the owner’s control; reasons 6 and 7 are within the consultant’s control; and the rest are beyond either the owner’s or the consult- ant’s control.
Table 1. Summary of Cost and Schedule Increases for Four Projects Project
contract data
Traffic analysis Case 1
Engineering study, Case 2
Environmental study, Case 3
Engineering design,
Case 4 Total
Original amount共dollars兲 400,000 3,940,482 1,485,902 2,316,125 8,142,509
Final amount共dollars兲 519,423 4,424,447 2,248,398 2,971,387 10,163,655
Percent increased 119,423 483,965 762,496 655,262 2,021,146
Percent increased 29.9 12.3 51.3 28.3 24.8
Original schedule 6/1/18⬃5/30/91 6/21/89⬃6/20/92 11/1/89⬃10/31/92 4/1/90⬃12/1/92
共months兲 36 36 36 32 140
Final schedule ⬃5/31/92 ⬃6/30/95 ⬃12/31/94 ⬃9/30/94
共months兲 48 72 62 54 236
Time extended 12 36 26 22 96
Percent extended 33 100 72 69 69
Quantification of Cost Schedule Increases
The cost/schedule increase percentage is summarized in Table 2.
For the cost of Case 1, 44.3% of the total increase
共$119,423,Table 1兲 was caused by the owner’s request, which was the only reason within the owner’s control. Beyond control, 34.3 and 21.4% were by stakeholders and law change, respectively. These two ‘‘beyond-control’’ reasons totaled 55.7%. Sources of these numbers and detailed calculations for Case 1 are explained later in the case study; the other three cases are described in the Ap- pendix.
We can see that about half of increased cost and time are contributed by reasons beyond either the owner’s or the consult- ant’s control. One owner’s project manager said that many projects were questioned by the stakeholders during the project period in the early 1990s, many difficult, beyond-control pro-
cesses increased cost and time. Perhaps the increases also resulted from the characteristics of environmental services, which incline to attract the public’s attention. The cost/time increases from rea- sons within the owner’s control total about one-third. Those rea- sons within the consultant’s control contribute the least. The time extension solely caused by the consultant’s inability to complete Case 1 is an exceptional case that will be described in the case study.
Although owner’s failure does not appear in any cost or sched- ule increases in these cases, it certainly does impact a consultant’s schedule and cost performance. These statements were common in the consultants’ correspondence to the owner: ‘‘If these items can be furnished to us in the next two weeks, we can meet our schedule,’’ ‘‘in order to complete this work on time it would be extremely helpful to have the following additional information form
共the owner兲,’’ etc. Their disappearance in the formal amend- Table 2. Quantification of Cost and Schedule IncreasesReasons for increase
Case 1 Case 2 Case 3 Case 4 Total
Cost 共percent兲
Time 共percent兲
Cost 共percent兲
Time 共percent兲
Cost 共percent兲
Time 共percent兲
Cost 共percent兲
Time 共percent兲
Cost 共percent兲
Time 共percent兲 Owner’s control
1. Owner’s request 44.3 80.7 26.7 27 1.6 32.6 7
2. Optimistic schedule 39 15
3. Omissions–owner 2.5 0.6
4. Owner’s failure
5. Other consultants 18.6 13 7.0 4
Subtotal 44.3 0 83.2 39 45.3 40 1.6 0 40.2 26
Consultant’s control
6. Consultant’s inability 100 12
7. Omissions–consultant 9.4 11 3.1 4.5 3
Subtotal 0 100 0 0 9.4 11 3.1 0 4.5 15
Beyond control
8. Growing needs 14.0 4 22.1 12.4 1
9. Stakeholders 34.3 16.8 39 26.3 22 22.9 45 23.4 31
10. Others–change of laws 21.4 22 5.0 23 50.3 55 19.5 27
Subtotal 55.7 0 16.8 61 45.3 49 95.3 100 55.3 59
Total 100 100 100 100 100 100 100 100 100 100
Table 3. Analysis of Cost and Schedule Increases for Case 1
Change or amendment Reasons
Contributions
共percent兲 Cost increase
Time extension 共months兲
Change 1 0 9⫽
Consultant’s inability 0.9 8⫹
Owner’s request 0.1 1
Change 2 Consultant’s inability 1.0 0 5
Amendment 1 $102,344 共85.7%兲⫽ 0
a. Additional corridor Stakeholders 0.8 40,938 共34.3%兲⫹
traffic study Owner’s request 0.2 10,234 共8.6%兲⫹
b. Land use forecast using Others-standard change 0.5 25,586 共21.4%兲⫹
ABAGa1990 projections Owner’s request 0.5 25,586 共21.4%兲
Amendment 2
Time extension for Amendment 1
Consultant’s inability 1.0 0 12共100%兲
Amendment 3
Additional impact analysis
Owner’s request 1.0 $17,079 共14.3%兲 0
Total $119,423 共100%兲 12共100%兲
aAssociation of Bay Area Governments.
ments is probably due to the consultants’ unwillingness to dis- close the owner’s responsibility.
Case Study
Case 1 is a traffic operational analysis that provides background data for evaluating the environmental consequences of a construc-
tion project. The following is an amendment analysis as well as schedule and cost increase analysis for this project.
Amendment Analysis
The amendment analysis results are shown in Table 3. The first
column shows the incurred changes or amendments. Because a
change or amendment may involve more than one reason, the
Fig. 1. Time extension and cost analysis of Case 1owner’s project manager was asked to distribute contribution per- centages from individual reasons to that change. The increased cost/time amount is prorated accordingly in the fourth and fifth columns. The total cost increase is $119,423; Amendment 1 cost
$102,344. The 85.7% cost increase is due to the reasons listed in the second column.
There were two informal time extensions at the beginning without formal amendments
共Fig. 1兲, but these two extensions didnot change the final completion time. The draft report preparation was given another 9 months. The major reason
共90%, written as0.9兲 was that the consultant could not complete the draft report within the original 5-month time frame. Later, an additional 5 months was granted due to the consultant’s inability
共100%兲 tocomplete the work.
In Amendment 1
共Table 3兲, two change items were stated inthe backup documents:
共a兲 additional traffic study; and 共b兲 theland use forecast based on Association of Bay Area Governments
共ABAG兲 1990 version.The preliminary reasons identified for these two changes were stakeholders, owner’s request, and growing needs. From the project files, two memos were found relevant to this amendment:
共1兲 from an attorney of the owner’s Legal Division questioned if
the additional study was related to the original scope, and if yes, why it was not included in the original contract, and the other was the justification by the project manager— ‘‘It wasn’t until that the need to study . . . were determined . . . it is also seen from the results of the traffic study performed to date . . . Therefore, a study is necessary . . . The ABAG 1987
共projections兲 are now ob-solete.’’ From the above explanations, the reasons for changes look like growing needs, owner’s request after decision change, and standard change.
Finally, a discussion with the owner’s project manager re- vealed that the additional study was mainly requested by the local
governments and residents, i.e., the stakeholders and the owner.
The ABAG usage was due to standard change and owner’s re- quest.
In conclusion, for the contributions to Amendment 1共a兲, as shown in Table 3, about 80% of the change was caused by stake- holders and 20% by the owner’s request. The $40,938
共34.3% of$119,423兲 from stakeholders is four times the $10,234 that is due to owner’s request. The same analysis was done for Amendment 1共b兲.
For Amendment 2, a 1-year time extension was granted for the extra work in Amendment 1. The reasons are mostly consultant’s inability to complete the extra work. Time extension could have been included in Amendment 1, but were not, perhaps because 14 months had been already granted for the previous two informal extensions due to the consultant’s own failure to deliver on time.
Amendment 3 was an additional impact analysis to study traf- fic operational impacts of various alternatives. The major alterna- tive was the preferential treatment of high-occupancy-vehicles
共HOV兲 within the study area. It was a new service not in theoriginal scope, and hence an owner’s request.
After sorting the above reasons and adding their contributions to the cost/time increases, the percentages were posted in the second and third columns of Table 2. For example, the owner’s request increased cost by 44.3% for Case 1.
Schedule and Cost Increase Analysis
The draft and final reports were seriously delayed. The owner used such tones in a memo to the consultant: ‘‘We are extreme- ly disappointed that the . . . report has not been complet- ed, . . . schedule is now in jeopardy, . . . if we do not receive the report by . . . we will not process any future invoices for pay- ment.’’ The consultant responded with: ‘‘I . . . apologize for the
Table 4. Analysis of Cost and Schedule Increases for Case 2Amendment Reasons Contributions Cost increase
Time extension 共months兲
1. Increased geotechnical work Owner’s request 1.0 $ 55,685 共11.5%兲 0
2. Marine survey $ 24,000 共5%兲⫽ 0
Omission–owner 0.5 12,000 共2.5%兲⫹
Owner’s request 0.5 12,000 共2.5%兲
3. Supplemental services for EISa $209,374 共43.3%兲⫽ 0
Stakeholders 0.2 41,875 共8.7%兲⫹
Owner’s request 0.8 167,499 共34.6%兲
4. Supplement for EISa $194,906 共40.3%兲⫽ 0
Stakeholders 0.2 38,981 共8.1%兲⫹
Owner’s request 0.8 155,925 共32.2%兲
5. Revised EDbtime 0 12 共33%兲⫽
Stakeholders 0.5 6 共16%兲⫹
Optimistic 0.5 6 共17%兲
6. Revised EDbtime 0 6 共17%兲⫽
Stakeholders 0.3 2 共6%兲⫹
Optimistic 0.3 2 共5%兲⫹
Others–law change 0.4 2 共6%兲
7. Revised EDbtime 0 18 共50%兲⫽
Stakeholders 0.3 6 共17%兲⫹
Optimistic 0.3 6 共17%兲⫹
Others–law change 0.4 6 共16%兲
Total $483,965 共100%兲 36 共100%兲
aEnvironmental impact statement.
bEnvironmental document.
delay.’’ One consultant’s review comment also stated ‘‘the lack of complete traffic information makes completing the environmental document on schedule very difficult.’’
Fig. 1 provides explanations for these delays. The upper six time scales show delays due to individual changes, and the rea- sons are listed under the delayed periods. The final report was sent in April 1993, way beyond the amended completion time of May 31, 1992.
The bottom of Fig. 1 shows cost expenditures versus time. The original contract amount was $400,000 for 3 years, and the actual total was $519,423 for more than 4 years. At the end of the first year, the actual cost was $240,416, under the budgeted cost of
$341,150. This does not mean cost efficiency, because the cost expenditure was actually postponed due to consultant’s delays.
The progress, in terms of cost, was only 46.3%
共$240,416/$519,423兲 complete, which is much less than the planned 85%.
At the end of the third year, the actual cost was $483,105, which was over the contract amount $400,000. Cost was mainly spent in the first and the third years, as shown by the actual curve.
The increased cost was due to reasons beyond the consultant’s control
共Table 3兲.Grouping for Easier Use
The reasons for cost/time increases can be reclassified for spotting problems and tracing responsibility. Like construction, these rea-
sons can be grouped as compensable, nonexcusable, and excus- able
共Barrie and Paulson 1992兲. The new grouping is as follows:A. Mainly within the owner’s control
共compensible兲Reason 1. Owner’s request
a. Additional work b. Optimistic schedule c. Omissions
Reason 2. Owner’s failure a. Failure to provide information b. Incomplete or incorrect information c. Other consultants
B. Mainly within the consultant’s control
共nonexcusable兲Reason 3. Consultant’s failure
a. Consultant’s inability b. Underestimates or omissions
C. Beyond either the owner’s or consultant’s control
共excusable兲Reason 4. Growing needs
Reason 5. Stakeholders a. Agencies
b. Public c. Others
Owner’s request
共reason 1兲 is a scope-related category. Addi-tional work
关Reason 1共a兲兴 occurs after engineering design starts.An optimistic schedule
关Reason 1共b兲兴 and owner omissions 关Rea-son 1共c兲兴 are scope mistakes made before work is started. The
Table 5. Analysis of Cost and Schedule Increases for Case 3Amendment Reasons Contributions Cost increase
Time extension 共months兲
$140,045 共18.4%兲⫽ 0
1. a. Nine open houses Stakeholders 1.0 43,558 共5.7%兲⫹
b. Visual impact study Stakeholders 0.5 33,107 共4.3%兲⫹
Owner’s request 0.5 33,107 共4.3%兲⫹
c. Hazardous waste review Needs 0.5 15,137 共2.0%兲⫹
Owner’s request 0.5 15,137 共2.0%兲
$ 58,396 共7.7%兲⫽ 0
2. a. Develop public comment data base system
Needs 1.0 29,198 共3.8%兲⫹
b. Marine operations study Stakeholders 0.8 23,358 共3.1%兲⫹
Owner’s request 0.2 5,840 共0.8%兲
$133,400 共17.5%兲⫽ 0
3. a. Work iteration Other consultants 0.4 53,360 共7.0%兲⫹
b. Supplementing Needs 0.4 53,360 共7.0%兲⫹
incomplete information Owner’s request 0.2 26,680 共3.5%兲
c. Increased study area
$355,287 共46.6%兲⫽ 14 共54%兲⫽
4. a. Completing Draft EISa Owner’s request 0.3 106,586 共14.0%兲⫹ 4 共16%兲⫹
b. Public and agency Other consultants 0.25 88,822 共11.6%兲⫹ 3 共13%兲⫹
comments for final EISa Stakeholders 0.25 88,822 共11.6%兲⫹ 4 共14%兲⫹
c. Marine operations risk analysis
Omission-consult 0.2 71,057 共9.4%兲 3 共11%兲
5. Legal transfer 0 0
$ 75,368 共9.9%兲⫽ 12 共46%兲⫽
6. a. Additional effort—draft Needs 0.2 9,444 共1.2%兲⫹ 1 共4%兲⫹
and supplemental EISa Others–law change 0.8 37,776 共5.0%兲⫹ 6 共23%兲⫹
b. Public and agency comments Stakeholders 1.0 8,649 共1.1%兲⫹ 1 共4%兲⫹
c. Updating marine Stakeholders 0.2 3,900 共0.5%兲⫹ 1 共4%兲⫹
operations risk analysis Owner’s request 0.8 15,599 共2.1%兲 3 共11%兲
Total $762,496 共100%兲 26 共100%兲
aEnvironmental impact statement.
three are listed under the owner’s request. Growing needs
共Rea-son 4兲 refer to extra work not anticipated at the beginning. They can be regarded as unforeseen events that are excusable. Stake- holders
共Reason 5兲 generally include government agencies 关Rea-son 5共a兲兴 and the public 关Reason 5共b兲兴. Others 关Reason 5共c兲兴, such
as law changes or standard changes, are related to the stakeholder, so are merged under stakeholders.
It is then easier to remember that the owner’s request and owner’s failure are the two major reasons mainly within the own- er’s control; consultant’s failure is the reason within the consult-
Table 6. Analysis of Hour and Schedule Increases for Case 4Change in work scope Reasons Contributions Hour increase
Time extension 共months兲
180 共1.9%兲 0
1. Stage I project work program, 8/12/91 Owner’s request 1.0
4,320 共47%兲⫽ 0
2. Additional air quality study, 2/24/92 Needs 0.3 1,426 共15.5%兲⫹
Others–law change 0.7 2,894 共31.5%兲
1,620 共17.6%兲 0
3. Public participation, 2/24/92 Stakeholders 1.0
1,130 共12.3%兲⫽ 10
4. Additional project management Stakeholders 0.4 452 共4.9%兲⫹
and administration, 5/29/92 Needs 0.4 452 共4.9%兲⫹
Other–standard change 0.2 226 共2.5%兲
320 共3.5%兲 0
5. Parking, circulation impact study, 5/29/92 Omission-consultant 1.0
320 共3.5%兲⫽ 0
6. Update traffic operations Needs 0.5 160 共1.7%兲⫹
analysis using ABAGa1990, 12/21/92 Other–standard change 0.5 160 共1.8%兲
44 共0.5%兲 0
7. Additional visual aids, 8/14/92 Stakeholders 1.0
100 共1.1%兲 0
8. Ramp metering analysis, 12/21/92 Others–law change 1.0
1,159 共12.6%兲⫽ 0
9. Design variation impact study, 3/16/93 Stakeholders 0.5 580 共6.3%兲⫹
Needs 0.5 579 共6.3%兲
Total 9,193 共100%兲 10
aAssociation of Bay Area Governments.
Table 7. Analysis of Cost and Schedule Increases for Case 4
Amendment Reasons Contributions Cost increase
Time extension
共months兲
1. Time lapse between $138.538 共21.1%兲 0
negotiations and NTP Others–law change 1.0
0 12 共55%兲⫽
2. a. Time lag make-up Others-law change, 0.4 5 共23%兲⫹
b. Additional community involvement Stakeholders 0.6 7 共32%兲
$516,724 共78.9%兲⫽ 0
3. a. Additional traffic Needs, 0.4 144,683 共22.1%兲⫹
operational analysis Standard change 0.6 191,188 共29.2%兲⫹
b. Addition alternative studies Owner’s request, 1.0 10,335 共1.6%兲⫹
c. Public participation Omission–consultant 0.1 20,668 共3.1%兲⫹
Stakeholders 0.9 149,850 共22.9%兲
0 10 共45%兲⫽
4. a. Public concerns Stakeholders 0.3 3 共13%兲⫹
b. Work change Others–law change 0.7 7 共32%兲
Total $655,262 共100%兲 22 共100%兲
ant’s control; and other reasons are beyond either the owner’s or consultant’s control. If a reason occurs in Group A, the owner will compensate both cost and time. For Group B reasons, the consult- ant will absorb the cost and time. For Group C reasons, the time will be extended, but the cost will be absorbed by the consultant
共Kraiem and Diekmann 1987兲.Engineering design cost and schedule overruns are common.
Problems generally arise from causes about which we are igno- rant, for which we lack information, or that we cannot control
共Ross 1995兲. The three groups of reasons are consistent with thethree causes. The reasons in Group A are usually the result of the owner’s ignorance, those in Group B occur when diagnosis infor- mation is lacking and Group C reasons are due to what we cannot control.
Conclusions
Identifying the reasons is usually the first step when addressing a problem, and then corrective action can be taken. Traditional con- trol systems detect project cost and schedule overruns, but seldom further identify the reasons causing this result. The identified rea- sons supplement control systems in analyzing the cause-effect relationship for an engineering design process. This analysis helps trace responsibility and improve the work process. With the cat- egorized reasons, the owner and consultant can have common understanding of cost and schedule change so the change order can be issued and settled with fewer disputes.
Appendix
In Case 2, The consultant was required to prepare an engineering study consisting of three technical reports:
共1兲 geometric designalternatives study,
共2兲 location hydraulics study, and 共3兲 geotech-nical impact assessment. These reports would be used to prepare environmental documents.
Seven amendments were signed
共Table 4兲. The first two weretechnical work scope increases. The third and fourth amendments were supplemental services provided during the environmental review. The supplemental services were originally written in the contract scope and amended as needed. Amendments 5, 6, and 7 were 3-year postponements of the environment document, due to requirements from agencies, residents, and regulation change.
During this period, the consultant was used to supplement the owner staff.
After sorting the above reasons and calculating their contribu- tions to cost/time increases, the percentages were posted into the fourth and fifth columns of Table 2.
In Case 3, the consultant was required to assess the environ- mental impact of project alternatives, assist in coordinating the
technical studies being done by other consultants, and prepare the draft and final environmental document, project report, and other documents. The amendment analysis is shown in Table 5.
In Case 4, the consultant was required to prepare preliminary engineering drawings, estimates, project reports, environmental documents, and the project approval report. There were nine work changes as shown in Table 6. The change amount was calculated in work-hours. Later on, these work changes were incorporated into formal amendments, and the hours were transferred into dol- lars in Table 7.
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