USING ‘WHOLE LIFE CYCLE VALUE’ TO EVALUATE INFRASTRUCTURE MEGAPROJECTS

misbe2011 Tracking Number 50

Keywords: criteria, evaluation, stakeholders, whole life cycle value ABSTRACT Project evaluation is an effective tool in project management as it provides stakeholders with a management process through which they can learn from the past and perform better in the future. Although various project monitoring and evaluation methods have been used in the construction industry, most of these traditional evaluation approaches emphasize the three basic success criteria of time, budget and quality. However, recent research emphasizes ‘satisfaction’ of the key stakeholders as also important. It is therefore necessary to develop a more holistic evaluation tool to evaluate projects from perspectives of all key group stakeholders. However, it appears that no systematic project evaluation approach focusing on project stakeholder perspectives, has been developed. This paper aims to develop systematic evaluation criteria, based on the concept of whole life cycle value (WLCV), which integrates all the key stakeholders’ value objectives and can be used to evaluate an infrastructure megaproject more holistically and comprehensively. Projects aim to deliver value, including cost savings for client, desired functions for all end-users and other stakeholders over the whole life. The exercise of identifying value objectives of key group stakeholders and integrating these value objectives into the client value objectives, and next formulating reasonable WLCV criteria are hypothesized to be key contributors to achieving maximum project WLCV. It is therefore important to be able to identify, analyze and deal with the expectations of each group of stakeholders over the entire project life time, i.e. from client requirements formulation up to demolition / re-use. In order to maximize WLCV, we must identify its essential components, namely: significant main-criteria for measuring project WLCV, as well as related sub-criteria which will help evaluate specific dimensions of the parent main-criteria. To be holistic as intended, both main and ‘sub’ criteria should relate to all stakeholders including the client. Based on a comprehensive literature review in evaluation, decision making and value management studies, several semi-structured interviews with experts in academia and industry, and findings from the first stage of a relevant case study, this paper proposes a preliminary WLCV criteria system for infrastructure megaprojects. A preliminary WLCV model will be formulated in the next stage of this research, based on the findings of a planned questionnaire survey. This would help clients to find which components of the project WLCV are more critical and then pay more attention to those parts, e.g. in collecting and distilling relevant experiences from past projects and deploying knowledge so acquired in future projects, to increase project WLCV. All other stakeholders can also benefit from this, as the client could then consider and assign reasonable weights / scores to their value objectives when identifying target components of the project WLCV. This paper concludes with a discussion of some of the major difficulties in identifying, balancing and formulating WLCV criteria and some useful directions and opportunities for further research in this field.