Towards Parametric Causal Model of
Concurrent Engineering Decisions in Construction
Corresponding Author: El-Bibany, Hossam E.
Author(s): El-Bibany, H.E., and Lynch, T.
Organisation(s): Penn State University (USA)
Construction research and knowledge have long taken a local perspective to various problems, separating each problem from its environment and considering external influences as boundary constraints. This resulted in advances in the treatment of these local problems but did not usually contribute to the global goal of looking into the concurrent engineering process in an integrated way. For example, productivity improvement in the construction stage has always helped contractors achieve cost savings but may not have helped owners achieve similar savings in the final facility. The reason is not that the contractors’ savings were not directly passed to the owner, as in most cases they were based on the competitive nature of construction. The main reason may be that there is no integrated framework explaining the global parametric relationships that reflect the effect of decisions made at the various stages of the facility life-cycle (by various project organizations) on overall quality, cost and delivery time. The fragmented nature of the construction industry and the variability of the constructed facilities did not help create such integrated framework. This problem does not affect only the construction industry but also the competitive advantage in other industries. For example in comparison performed in the pharmaceutical industry, a unit product with a market value of $5 was found to have a facility acquisition cost of $1.11 for one leading company and $1.54 for a leading competitor.

The goal of the research presented in this paper is to create an integrated parametric framework detailing the interrelationships between the project parameters that reflect the effect of concurrent engineering decisions on total quality, cost and delivery time. To consider cost and time under a unified framework, elements like information requirements and communication need to be considered. Hence, organization theory and economics is used in combination with construction process knowledge to build the foundation of the framework. In particular, the main objectives are to:

1. Develop a framework for identifying the impacts of project decisions, at different organizational levels, on project quality, cost and delivery time. To consider cost incurred by process time inefficiencies and cost incurred in a tradeoff to save time, transaction cost economics theory is used as the unifying agent in the framework. The framework combines construction industry knowledge, including project organization, production and quality parameters, with organization theory and transaction cost economics to create parametric causal models depicting the interplay between time and cost and quality.

Out of the whole life of a construction project, the scope of the framework is on the effects of planning, programming, design, procurement and construction stages on the total project quality, cost and delivery time from an owner's perspective in the building industry. The framework identifies different levels of decisions in a project organization and explains how cost and quality and delivery time are affected. The levels include the individual, group, firm, inter-firm, and project.

2. Detail the framework into its theoretical parametric relationships using the appropriate bodies of knowledge. Transaction cost parameters originate primarily from transaction cost economics, an economic theory of organization. Whereas, production, quality and direct work parameters originate from construction engineering and management knowledge.

3. Evaluate the theoretical parametric models by studying similar type projects.  The theoretical models are evaluated through observation of real projects. Expert interviews using questionnaires and case studies of similar types of projects will be used as the main tool of evaluation. Based on the types of data collected, scientific quantitative and qualitative analysis techniques will be used in the evaluation process. 

4. Use computer simulation models to study the effect of time on the decision parameters. In order to study the time factor on the parametric relationships, computer simulation is proposed. A commercial software, iThink™, was acquired to be used as the main computer simulation and modeling tool.

5. Integrate the parametric models and explore the development of mathematical relationships. Through the evaluation process, interdependent sets of parameters will be identified. For each set, a mathematical or functional relationship will be modeled using the collected data and the computer simulation models reflecting the system dynamics.