Performance Based Studies Research Group

-Abstract-

The major objective of construction procurement systems is to minimize risk of construction nonperformance.  The specification, low-bid process, has been unsuccessful in delivering a performing, sustainable construction product.  The construction industry is attempting to increase the level of performance (on-time, on-budget, and meeting quality expectations) by moving toward alternate delivery systems.  This research presents a theoretical foundation based on an extension of the information theory, the measurement of information.

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It identifies the correlation between the amount of performance problems in the current construction industry procurement systems and the amount of information used in the processes.  The research also attempts to explain why the construction industry has difficulty in changing, which sectors of the industry will be resistant to performance information, and why it has become difficult to clearly identify liability and responsibility of nonperformance and minimize litigation.

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-Abstract-

This article is an update to a longitudinal study of the implementation of Performance Based Contracting in two different states.  The article discusses the research changes as the Performance Based or Best Value processes mature.  It also analyzes the reaction of the industry, protests to the process, difficulties of the government organizations to assimilate the processes.   The analysis uses Information Measurement Theory (IMT) concepts to explain the developments.

The results over the last year support the research hypothesis that the facility owner is the major constraint in determining the level of construction performance.  Implementation of performance based or best value processes can only be implemented when the facility owner understands the risk and cost of construction nonperformance.  The owner’s capability to use information will identify the implementation constraints of best value processes and the type and level of best value process.  The study covers the results of the implementation period of 3-1/2 years with the State of Hawaii and 2-1/2 years with the State of Utah.

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-Abstract-

Today’s facility owners and managers all face a growing challenge: how to obtain performing construction services delivered in a timely and economical fashion, to maintain their facilities. Job Order Contracting (JOC) is an innovative procurement/construction process using unit prices that minimizes the following problems:

1. Lack of timeliness and cost effectiveness of the procurement of repetitive repair and maintenance work.
2. Working with contractors who are forced to get jobs by being the "low-bid" or compete with contractors with the "low-bid" mentality (get the job with the low bid, and then reduce construction quality or use change orders to make a profit).
3. A lack of a "long term" partnering relationship between the facility owner and the contractor in an environment that is variable, filled with risk, and difficult to define.

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