Performance Based Studies Research Group

-Abstract-

A large government organization is using a risk management system which depends on the vendors to manage the risk on their contracts that they do not control, and to report on the status of the risk using a weekly risk report (WRR) and a risk management plan (RMP) which identifies how the vendor is minimizing the risk that they do not control. By minimizing the report content to dominant information that is difficult to refute (objective information such as time, cost, status), information is generated that motivates accountability, pre-planning, and performance of all parties. Dominant information minimizes the need for direction and control, identification of exact solution, and management, direction, and control by the client/user/buyers, and motivates the use of quality control/risk management by the contractors and quality assurance by the client/users. The transparency of the system becomes the enforcement of performance and accountability. Interesting concepts developed by the research include the concept that minimizing information flow is more effective than maximizing information flow between participants, vendors can effectively manage and minimize risk that they do not control by use of dominant information and best value concepts of measurement of performance and accountability can be initialized from the bottom up instead of from top down.

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-Abstract-

The Performance Information Procurement System (PIPS) was developed at Arizona State University (ASU). PIPS is used to deliver services. PIPS minimizes the client's risk/project management transactions by up to 90%, can increase vendor profit up to 100% at no additional cost to the buyer, and delivers projects on time, no cost deviations, with high customer satisfaction at a 98% rate. PIPS has been tested in the construction industry and has been adopted by ASU as the model for the delivery of services.

The implementation of the model has increased ASU's vendor's cash investments to $100M over the next ten years.

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-Abstract-

Project managers (PM) routinely make decisions in managing projects. Decisions are made when the project manager does not have sufficient information. Decision making increases risk, and usually forces an increase in project management, direction, and control. The future PM model is one where decisions, direction, control, and risk are minimized. Decision making will be forced to the lowest level, where the expert has been hired to minimize risk.

The new decision-less environment is being developed at the Performance Based Studies Research Group (PBSRG) at Tempe, AZ in the areas of the delivery of construction, IT, food services, sports marketing, and document control. The decision-less environment has a new contract model, a new risk model, a new outsourcing model, and a new project management model which manages a system instead of a technical function/service.

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-Abstract-

The University of Minnesota has been implementing the best value Performance Information Procurement System (PIPS) for the last four years. PIPS uses a new project management model which transfers risk and control to the vendor, and minimizes the client’s PM activities. The performance of the vendors has increased and the number of transactions has been minimized, however, many of the project managers have resisted the new PM model. The resistance of the PMs has resulted in the analysis of the strategic plan to implement the new project management model. The result of the analysis is that the strategic plan must concentrate on the development of the core team of visionaries and not on the implementation of the new PM model.

The tactical plan on the mechanics of the new PM model is also required, but is not as important as nurturing the core team of visionaries who are leading the change. The strategic plan ensures the sustainability of the new PM model.

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-Abstract-

A new contract model has been developed which changes a project manager’s (PM) responsibilities from writing and enforcing a contract, to transferring the responsibility of writing and administering the contract to the vendor. The new environment changes the PM’s role from management, direction, and control, to quality assurance.

Quality assurance is ensuring the vendor has a quality control and risk management plan. The new model is based on the assumption that the client cannot control the vendor through the contract. The control mechanism is deleted, and the vendor creates a contract document that minimizes risk. The contractual document, which must be approved by the client’s PM and legal, includes a risk managing mechanism called the risk management plan (RMP) and a weekly risk report (WRR.) The new contractual mechanism is the expert contractor’s mechanism to document and minimize risk and transactions.

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