Performance Based Studies Research Group

-Abstract-

The Dutch construction industry experienced a problem with collusion for five years ending in 2003. Innovative Dutch visionaries perceived a potential relationship between an inefficient, transaction laden, over-regulated low price award environment and supplier collusion. Kashiwagi and the Performance Based Studies Research Group (PBSRG) introduced the Construction Industry Structure (CIS) and best value Performance Information Procurement System to the Netherlands in 2004. Heijmans (third largest Dutch contractor) and the Rijkswaterstaat brought the PIPS technology into the Netherlands by signing licenses in 2006, Santema and Scenter/Delft University of Technology followed later in 2006, and became the first successful research group to build a PBSRG type research platform. In 2009, the Rijkswaterstaat utilized Scenter’s expertise to deliver $800M of fast track infrastructure construction utilizing the best value PIPS concepts. The preliminary test results included the following: collusion problems may be caused by client delivery system, problem with construction industry performance is a process issue and not a technical issue, best value PIPS can solve Dutch construction problem issues and is a paradigm shift more than a legal issue, validation of the PBSRG model of simultaneous basic theoretical research, prototype testing, and implementation using industry funding may be the quickest way to change industry practices.

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-Abstract-

Best Value Procurement/Performance Information Procurement System (BVP/PIPS) has been developed by Dean Kashiwagi and the Performance Based Studies Research Group (PBSRG) from 1991 – 2010. BVP/PIPS is a licensed technology from Arizona State University that includes a deductive logic called Information Measurement Theory (IMT), an industry structure model which shapes the PIPS functions, and a process and structure that transfers risk and control to expert vendors.

The BVP/PIPS has gone through numerous stages: the performance information centered PIPS (1994-2001); the PIPS testing phase (2001-2005); and the implementation stage (2005-2009); and the theoretical refinement and standardization of BVP/PIPS technology (2010). BVP/PIPS was introduced into the Netherlands in 2005 by a large general contractor Heijmans, the Rijkeswaterstaat, and aggressively proliferated by Scenter and others. BVP/PIPS usage in the Netherlands is modified to fit within the European procurement law. However, the main advantage of PIPS is the IMT based philosophy of minimized management, direction, and control of expert vendors.

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