Earned Value-Based Performance Monitoring of Facility Construction Projects

Purpose – To contribute to the diffusion of Earned Value Management (EVM) as a practicable methodology to monitor facility construction and renovation projects in the context of the European industry. Design/methodology/approach – Firstly, a review of the literature reveals how EVM evolved as a tool for facility construction project monitoring together with specific concerns for its application. Then, a review of EVM practice and trends in Europe are provided and, finally, applicability and viability of the method is proved through a case demonstration. Findings – The EVM practice in the European construction industry is found to be lagging behind other experienced countries and industries despite EVM is found to be applicable, adaptable, and predictive of integrated final cost and schedule of facility construction projects. In particular, cost estimate at completion is forecasted by a simple Schedule Performance Index (SPI) while for the time estimate at completion the Earned Schedule concept is revealed as an accurate predictor. Research limitations/implications – The paper urges the need for research of a European standard as a primary factor for successful diffusion of EVM usage in architecture, engineering and construction projects. Practical implications – This paper helps practitioners to understand the adaptability of EVM practice in the European construction industry and to apply EV tools for effectively monitoring the performance of their projects. Originality/value – Current trends of EVM practice in the European construction context are presented and suggestions for sustaining the diffusion of EVM are given

An earned schedule-based regression model to improve cost estimate at completion

Traditional Earned Value Management (EVM) index-based methods for Cost Estimate at Completion (CEAC) of an ongoing project have been known for their limitations inherent with both the assumption that past EVM data is the best available information and early-stage unreliability. In an attempt to overcome such limitations, a new CEAC methodology is proposed based on a modified index-based formula predicting expected cost for the remaining work with the Gompertz growth model via nonlinear regression curve fitting. Moreover, the proposed equation accounts for the schedule progress as a factor of cost performance. To this end, it interpolates into its equation an Earned Schedule-based factor indicating expected duration at completion. The proposed model shows itself to be more accurate and precise in all early, middle, and late stage estimates than those of four compared traditional index-based formulae. The developed methodology is a practical tool for Project Managers to better incorporate the progress status into the task of computing CEAC and is a contribution to extending EVM research to better capture the inherent relation between cost and schedule factor

Nonlinear cost estimates at completion adjusted with risk contingency

Forecasting the final cost with Earned Value Management (EVM) and managing contingency budgets during the project execution have been traditionally considered as two separate streams of project management research. In an attempt to combine the two areas for the purpose of reflecting the risk impact on the cost forecast, this paper presents a cost estimate at completion (CEAC) methodology adjusted with risk contingency. The proposed method is a refined Earned Schedule (ES) based nonlinear CEAC model modified with a new parameter representing the S-shaped contingency consumption as a portion of the project budget at completion. The model is validated on eight construction projects and its estimates’ accuracy and stability with a varying contingency parameter value in the early, middle, and late stages are evaluated. The cost–schedule-risk relationship represented in the model is a contribution to creating a stronger connection between EVM and contingency cost management theories through capturing the interconnected dynamics between a cost baseline and contingency accounts of ongoing projects. As a practical implication, the model is a tool for integrating the contingency consumption into nonlinear CEAC models for accurate and stable cost forecasting especially during the early and middle stages of project execution

Earned value and cost contingency management: A framework model for risk adjusted cost forecasting

This paper proposes a novel framework model that considers different behaviors of cost contingency (CC) consumption in forecasting risk adjusted fi nal cost during the project execution. The model integrates the dynamics of how project managers can spend their contingencies into three S-shaped cost growth profi les to compute risk adjusted cost estimates at completion (CEAC). The three cost curves are modeled by the Gompertz growth model using nonlinear regression. Respectively, the framework embeds three different CC consumption rates to represent three main categories of aggressive, neutral or passive managerial attitudes in responding to project risk. The usage and viability of the model is demonstrated via a earned value management (EVM) dataset. The paper contributes to the body of knowledge by bridging the gap between the theories of EVM and CC management and provides project managers with a model to estimate the range of possible cost estimates at completion depending on the managerial policies that can be activated driven by different risk attitudes

Risk-Adjusted Contingency Management in Construction Projects

Successful project management (PM) aims at achieving the triple-constraint (time, cost and quality), respecting the elasticity between the three main drivers. To facilitate this, PM activities are supported by project risk management (PRM) in foresight and earned value management (EVM) in hindsight. Both PRM and EVM, being industry standards, facilitate to plan, and afterwards monitor and control the project cost. However, the two fields do not necessarily interact with each other which, in turn, hinders critical managerial decision making of releasing contingency reserves if demanded by the client since the money can be used as capital for other projects. Also, when inquired at any given point in time (corresponding to partial project completion), the project managers (PMs) find it tricky and challenging to confidently declare the adequacy of existing reserves till the project completion This provides research impetus for potential EVM-PRM integration and managing the contingency adjusted due to risk in the project. There is hardly any literature on this integration, resulting in lack of any viable framework to facilitate critical decision making. With objective to formulate a framework - coupled with necessary tools and techniques - this paper proposes the incorporation of EVM and PRM which aims at not only expanding the body of knowledge in the field of ‘project control'1 but also assist the PMs in securely and successfully steering the project to close out. The research is still in progress and no conclusive details are furnished as ye

The influence of risk on the equity share of build-operate-transfer projects

Purpose The purpose of this paper is to contribute to the understanding of the crucial influence of risks on the capital structure of build-operate-transfer (BOT) projects. Design/methodology/approach The equity portion of capital injected in a BOT investment is selected as the response variable and its relation with select identified risk factors is examined using a regression analysis on a data set of BOT projects. Findings Results have pointed out that the level of equity is significantly influenced by several sources of risk. Country, revenue, project and special purpose vehicle-related risks have been shown to have an impact on the size of the equity share of a BOT investment. Research limitations/implications The results could support both investors and lenders to better define the financial leverage of BOT projects. In particular, the study could help to have a better understanding of the main factors that influence the equity apportion of capital in BOT investments. Originality/value This paper contributes to fulfilling the lack of works addressing the relationship between risk factors and capital structure in BOT projects. In this way, this research leads to a better understanding of the risk factors that influence the capital structure of BOT project and they have therefore been proposed as a base for the establishment of improved methods to design refined capital structures in BOT projects. </jats:sec

A scientometric analysis of studies on risk management in construction projects

Risk management is one of the topical areas in construction project management research. However, no attempt has been made in the past decades to explore the emerging themes in this area. This paper reviews the research trends in risk management in construction. The bibliometric data of 1635 publications between 1979 and 2022 were extracted from Scopus using a set of keywords. The study used VOSviewer and Gephi to conduct a scientometric analysis on the extracted publications. The review outcome indicates a significant increase in publications on risk management in construction, with about 205 publications recorded between 2021 and 2022 alone. Based on this analysis, it is projected that the next decade will see significant research on risk management, especially as the construction industry moves towards Industry 5.0 with many uncertainties. Further, the most productive countries of risk management studies in construction include China, the United States, the United Kingdom, Australia, and Hong Kong. Emerging key research areas are discussed using network diagrams and clusters. These areas include the processes in risk management, risk analytical models and techniques, sources of risk and uncertainties, effective knowledge-based systems for improved risk management, risk contingency in construction contracts, risk-integrated project planning and scheduling, and stakeholder management. The findings of this study inform researchers on the current progress of risk management studies in construction and highlight possible research directions that can be considered

Risk-Adjusted Contingency Management in Construction Projects

Successful project management (PM) aims at achieving the triple-constraint (time, cost and quality), respecting the elasticity between the three main drivers. To facilitate this, PM activities are supported by project risk management (PRM) in foresight and earned value management (EVM) in hindsight. Both PRM and EVM, being industry standards, facilitate to plan, and afterwards monitor and control the project cost. However, the two fields do not necessarily interact with each other which, in turn, hinders critical managerial decision making of releasing contingency reserves if demanded by the client since the money can be used as capital for other projects. Also, when inquired at any given point in time (corresponding to partial project completion), the project managers (PMs) find it tricky and challenging to confidently declare the adequacy of existing reserves till the project completion This provides research impetus for potential EVM-PRM integration and managing the contingency adjusted due to risk in the project. There is hardly any literature on this integration, resulting in lack of any viable framework to facilitate critical decision making. With objective to formulate a framework - coupled with necessary tools and techniques - this paper proposes the incorporation of EVM and PRM which aims at not only expanding the body of knowledge in the field of ‘project control’1 but also assist the PMs in securely and successfully steering the project to close out. The research is still in progress and no conclusive details are furnished as yet

TASKS ON LAND USE MODERNIZATION IN UZBEKISTAN UP TO 2030

The goals and targets of the 2030 Agenda of the UN General Assembly Resolution in the field of sustainable development and the issues of implementation of national goals and targets in this area for this period are studied in the paper. An important aspect is to ensure the sustainable development of tasks related to the integrated economic, social and environmental development, the conservation and restoration of ecosystems and biodiversity, ensuring the efficiency of nature management and land use, resource-saving technologies in land and water use in agriculture. Particular attention is paid to article 15.3, which contains a call to the world community to combat desertification, restore degraded lands and soils, including lands affected by desertification, droughts and floods, and to prevent land degradation. On the basis of studies of the land use system problems in the republic, the main directions and tasks for the modernization of existing land use management have been established in order to move to a sustainable model. The implementation of the recommended targets and the ways to solve them provides a transition to a model of sustainable development of land use, to the balance and harmonization of socio-economic and environmental policies in the use of country’s land resources, to prevent land degradation and desertification, to fulfill Uzbekistan\u27s obligations stated in international documents in the field of sustainable development for the period up to 2030 year