SELECTING THE MOST APPROPRIATE PROJECT DELIVERY METHOD (PDM) PEKKA PAKKALA – RAMBOLL FINLAND OY MAY 27, 2013 NETLIPSE PRESENTATION MAY 27, 2013

INTERNATIONAL PRESENCE COUNTRY HEAD OFFICES 06

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01 BELGIUM, Brussels 02 CYPRUS, Episkopi 03 DENMARK, Copenhagen 04 ESTONIA, Tallinn 05 FINLAND, Helsinki 06 GERMANY, Hamburg 07 GREENLAND, Nuuk 08 INDIA, Hyderabad 09 KINGDOM OF SAUDI ARABIA, Riyadh 10 NORWAY, Oslo 11 POLAND, Warsaw 12 QATAR, Doha 13 ROMANIA, Bucharest 14 SOUTH AFRICA, Pretoria 15 SWEDEN, Stockholm 16 SWITZERLAND, Zurich 17 UAE, Dubai

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18 UK, London 19 USA, New York

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

RAMBOLL FINLAND OY

• History dates back to 1962 • In 2012 about 1 400 employees in 26 regional offices

• Turnover 111 M€ (2012)

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

SERVICES Infrastructure and Transport ▪ Water and Environment ▪ Buildings ▪ Management Consulting

Image size: 5,43 cm x Image size: 5,43 cm x 5,11 cm 5,11 cm Image size: 5,43 cm x 10,79 cm

Image size: 5,43 cm x Image size: 5,43 cm x 5,11 cmsize: 5,43 cm x 10,79 5,11 cm Image cm

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

INFRASTRUCTURE AND TRANSPORT

• Over 600 specialists in 20 regional offices • Regional and municipal engineering • Road and motorway engineering • Traffic engineering • Landscape architecture • Railway engineering

Image size: 11,29 cm x 10,79 cm

• Bridge engineering

• Ports and marine structures • Airport engineering • Geotechnical engineering • Operation, maintenance and risk management

• Project and construction management

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

Urban Development & Asset Management • Asset Management • Urban Planning & Design (City 360)

• Bridge Design, BMS, NDT, Asset Management Services, Training & Certification • Pavement & Pathways Assessment, Evaluation, PMS, Backlog, Tradeoff Analysis, Risks & Programmatic Forward Replacement Plan with Budget (State & Municipalities) • Special Studies (Winter Maintenance & PBMC)

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

AUTOMATED DATA COLLECTION OF PAVEMENTS & ROAD LINE MARKINGS

• Ramboll’s Laser RST high-tech automated pavement assessment vehicle collects condition assessment at normal highway speeds. This non-destructive testing helps

acquire detailed knowledge of the pavements and uses a specialized computer-based program for automated analysis. Scientific analysis can determine pavement deterioration rates and provide long-term pavement preservation program and longterm budget needs for rehabilitation. Ramboll Finland’s largest customer was the Finnish Road Administration (Finnra).Includes retroreflectivity of Road markings. 7

NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

BIKE & PEDESTRIAN PATHS

A unique asset maintenance service includes the asset inventory and assessment of bicycle and pathways. A three-wheeled bicycle using state-ofart technology was developed which respects the environment and safety requirements, for both the workers and travelling public. This example is from the condition inventory assessment of pedestrian and bike paths developed for the City of Jyväskylä in 2011. 8

NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

GIS-BASED SERVICES INCLUDING CUSTOMER FEEDBACK SYSTEMS & SATISFACTION

• Information services using GIS mapping allows the location of assets and the condition information to be viewed on-line. Also, customer surveys and other feedback mechanisms can be utilized using GIS mapping technology. Project studies using this technique were done for the municipalities of Forssa (2012), Järvenpää (2010), and

several regional Centres for Economic Development, Transport and the Environment.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Ramboll Finland

FTA FEASIBILITY STUDY INFRA-TEEMA RESEARCH PROGRAM

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NETLIPSE PRESENTATION MAY 27, 2013

FTA FEASIBILITY STUDY (INFRA-TEEMA)

• Determine if there are any practices to select the most appropriate Project Delivery Method (PDM) for new projects • Interviews with Finnish Transport Agency (FTA), Maryland State Highway Administration (MdSHA) and Virginia Department of Transportation (VDOT) • Findings from research reports and publications • Findings from interviews

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

GENERAL PRINCIPLES FOR DECISION MAKING

1. Choosing the most appropriate project delivery method is essential for success. 2. Not all projects are applicable to only one method. (each project is unique) 3. Most agencies use a unstructured or ad-hoc approach. 4. There is no single “guru” or knowledgeable expert fully competent with all project delivery methods. 5. A structured approach is needed for the decision making process. 12

NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

GENERAL PRINCIPLES FOR DECISION MAKING

6. There is no mutually exclusive set of criteria that uniquely and completely determine the appropriate project delivery method. 7. Appropriate factors/characteristics should be from internal & external sources. 8. Weightings, priorities, and rankings are semi-objective and needs to be a structured approach for the decision making process. 9. Selection based as objectively as possible

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

PDM PROCESS Developing Decisive Factors

Prioritizing, Analyzing, Weighing & Rating the Decisive Factors Against the Project Delivery Methods

Systematically Evaluate & Choose the Best Project Delivery Methods

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

SUMMARY OF DECISION METHODS Decision Making Methods Operational Research Procurement Path Decision Chart (Building Sector) Procurement Rating System (Building Sector)

Multi-Attribute Approach Weighted Score Model Analytical Hierarchy Process (AHP) Multi-Attribute Utility Approach Fuzzy Logic with Multi-Attribute Utility Approach Artifical Neural Network (ANN)

Statistical Discriminant Approach Computerized Rule-Based Expert Computer System (ELSIE) (Building Sector)

Design-Build Selector (Univ of Colorado – USA) 16

NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

CHALLENGE!

• Agencies do not have a systematic process to determine the most suitable PDM • Anything new should be relatively simple • Should be able to accomplish internally by FTA • Should be objective or at least semi-objective • Should be comprehensive • Able to do with minimum of people

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NETLIPSE PRESENTATION MAY 27, 2013

THREE TIER DECISION MAKING FRAMEWORK

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NETLIPSE PRESENTATION MAY 27, 2013

THREE TIER DECISION MAKING FRAMEWORK • Described in detail  TCRP Web-Only Document 41 Model: Evaluation of Project Delivery Methods • This model was developed for Transit projects – light rail (Metro) • Considers 24 important factors • The three tier framework decision making framework consists of three separate tiers or phases that are used to determine the most suitable PDM for a specific project • The three tiers consist of:  Tier 1: Analytical Approach  Tier 2: Weighted Matrix Approach  Tier 3: Optimal Risk Approach • Final decisions may be made at each tier. For example you may be able to stop at Tier 1 to determine the best PDM.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

THREE TIER FRAMEWORK - ADVANTAGES • The model as described in Touran et al. (2008) and Touran et al. (2009) (the three tier decision making framework) might be a potential choice to consider at FTA • Some benefits include:  A relatively simplistic yet semi-comprehensive approach  Allows for alternative factors to be included (each project is different)  Does not require significant resources (once implemented)  Includes a documented process for future reference and reengineering (benchmarking)  Tier 3 considers risks into the decision making  Main factors may be determined by the client (FTA)  Can be applied to other transportation modes (roads)

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 1 APPROACH Tier 1 includes six steps in the process:

1. Create Project Description (very simple) 2. Define Project Goals (cooperative effort) 3. Review Go/No Go Decision Points (remove obvious ones) 4. Review Project Delivery Method Advantages and Disadvantages 5. Choose Most Appropriate Project Delivery Method 6. Document Results • If Tier 1 produces a dominant delivery method, then document results and use this method. Otherwise, if there is no dominant method apparent, then it will be necessary to progress to Tier 2.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 1 – ANALYTICAL APPROACH

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Touran et al. (2009), “Evaluation of Project Delivery Methods”. TCRP Web-Document 41: TRB

TIER 2 – WEIGHTED MATRIX APPROACH Tier 2 includes five steps in the process: 1. Define the Selection Factors 2. Weight the Selection Factors 3. Score the results (from each Project Delivery Method) 4. Choose Most Appropriate Project Delivery Method 5. Document the Results Tier 2 includes more objective results as key factors are selected, the factors are weighted, and factors are scored. Criteria includes:  Remove duplicate factors  Number of critical factors is recommended to be between 4-7 (at least less than 10)  Total score of 100 points (remove factors having less than 5)  Avoid equal scoring  Weight & Score the factors 23

NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 2 FACTORS Critical Issues

Project Goals

Custom-made Goal-based Selection Factors

Custom-made Critical Issue-based Selection Factors

Remove duplicates & Add Gaps (missing factors)

Tier 2 Selection Factors • • • •

Comprehensive No Overlapping Concise Newer/Flexible Factors

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Touran et al. (2009), “Evaluation of Project Delivery Methods”. TCRP Web-Document 41: TRB

TIER 2 WEIGHTING EXAMPLE

Weight

Goal/Issue

50

Project complete before Olympic Games, November 1, 20XX

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Cost not to exceed €xxx Million (Budget set by Ministry/Politicians)

15

Reduce environmental consequences; like traffic congestion and pollution

10

Minimize client staffing/administrative burden during design and construction

100

Total

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 2 SCORING SCALE Weight 10

Description of Goal/Issue The evidence that the PDM positively aligns with the project objective or the issue is of the highest possible order of affirmation.

8

The PDM strongly aligns with the objective or issue and is realized in practice There is a slight risk that the objective or issue may not be beneficial.

6

Experience and judgment point to the PDM strongly aligning with the objective or issue. There is a mild risk that the objective may not be beneficial.

4

Experience and judgment slightly points to the PDM aligning with the objective or issue. There is a strong risk that the objective will be negatively affected.

2

There is little benefit to applying the PDM for this goal or objective. There is a strong likelihood that the object will not be achieved.

Odd #s

Intermediate values between two adjacent judgments.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Touran et al. (2009), “Evaluation of Project Delivery Methods”. TCRP Web-Document 41: TRB

TIER 2 FINAL SCORING EXAMPLE DBB Selection Factors

Design-Build

Factor Weight

Score

Weighted Score

Score

Project complete before Olympic Games, November 1, 20XX

50

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300

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Cost not to exceed €xxx Million (Budget set by Ministry/Politicians)

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150

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200

Reduce environmental consequences; like traffic congestion and pollution

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150

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90

Minimize client staffing/ administrative burden during design & construction

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8

80

6

60

Total Score

100

680 27

Weighted Score

750 NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 3 – OPTIMAL RISK APPROACH Tier 3 includes the qualitative and quantitative risk approach: 1. Qualitative Approach – Risk allocation matrix (plus, minus or neutral) 2. Quantitative Approach – Full Monte Carlo Risk Analysis (costly, time consuming & usually requires a consultant) The qualitative approach may provide a superior PDM during the risk allocation matrix. If after the qualitative approach there is more than one viable PDM, then a the quantitative approach via Monte Carlo (or equivalent) is considered to determine the best PDM based upon costs and schedule. Finally, document the results.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

TIER 3 QUALITATIVE RISK SCORING EXAMPLE DBB

Risk Factor

Design-Build

Responsible

Rating

Responsible

Rating

Permits/ Approvals

Owner

+

Contractor/ Owner

-

Different Site Conditions

Owner

0

Contractor/ Owner

+

Geotechnical Risks

Owner

-

Contractor

+

Contractor/ Owner

0

Contractor

+

Owner

-

Owner

-

QA/QC Other risk factors

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

SUMMARY & CONCLUSIONS • The key issue is to determine the most appropriate project delivery method for any given project, and not all projects are applicable to only one method. • There are no systematic practices used by most agencies to determine the most appropriate PDM, but are mainly intuitive decisions • There are systematic practices shown in research publications, but are usually too complicated and usually requires consultants, universities or external experts • The “3 Tier Decision Making Framework” may be a potential method to consider by FTA, but needs a decision to move forward for further investigation? The model needs to be tested and validated.

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NETLIPSE PRESENTATION MAY 27, 2013

Source: Aalto University – Pekka Pakkala

REFERENCES

Touran, A., Gransberg, D. D., Molenaar, K. R., Ghavamifar, K., Mason, D. J., and Fithian, L A. (2008), “TCRP Web-Only Document 41: Evaluation of Project Delivery Methods”. Transportation Research Board, Submitted August 2008, Washington, D.C. (USA)

Touran, A., Gransberg, D. D., Molenaar, K. R., Ghavamifar, K., Mason, D. J., and Fithian, L. A. (2009), “TCRP Report 131: A Guidebook for the Evaluation of Project Delivery Methods”. Transportation Research Board, 2009, Washington, D.C. (USA)

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NETLIPSE PRESENTATION MAY 27, 2013

If you keep doing what you’ve always done, You’ll always keep getting what you’ve always gotten. John C. Maxwell

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NETLIPSE PRESENTATION MAY 27, 2013

THANK YOU!

QUESTIONS? Further information: Pekka Pakkala +358 40-6532855 [email protected] 33

NETLIPSE PRESENTATION MAY 27, 2013