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A platform for research: civil engineering, architecture and urbanism
Subcontractor Schedule Performance: Finance-Inspired Schedule Beta Indices
Construction projects continue to be faced with chronic delay issues, which are not yet quantifiable to become controllable. In construction projects, subcontractors play an important role and directly contribute to the production progress. Evaluating their schedule performance can become a valuable strategy for general contractors as part of their risk mitigation. It also allows subcontractors to substantiate their reputation with an objective value. In the future, this can be added to prequalification akin to setting safety expectations and allow bonding agencies to refine subcontractor ratings. One should therefore develop a meaningful mathematical quantification of schedule performance by subcontractors. Previous research has adapted the so-called beta, a financial index that tracks stock price performance within their market. But the new schedule beta functions like a correlation coefficient, i.e., by definition it cannot distinguish fast subcontractor activities in a fast project from slow activities in a slow project. This research therefore refines schedule beta by breaking it into its downside and upside constituent parts of schedule performance, again inspired by finance. An exemplar is reanalyzed to demonstrate its functioning and explain different types of subcontractor performance. Results confirm the feasibility of extracting the downside and upside schedule beta, which can support the goal of keeping projects on time.
Subcontractor Schedule Performance: Finance-Inspired Schedule Beta Indices
Construction projects continue to be faced with chronic delay issues, which are not yet quantifiable to become controllable. In construction projects, subcontractors play an important role and directly contribute to the production progress. Evaluating their schedule performance can become a valuable strategy for general contractors as part of their risk mitigation. It also allows subcontractors to substantiate their reputation with an objective value. In the future, this can be added to prequalification akin to setting safety expectations and allow bonding agencies to refine subcontractor ratings. One should therefore develop a meaningful mathematical quantification of schedule performance by subcontractors. Previous research has adapted the so-called beta, a financial index that tracks stock price performance within their market. But the new schedule beta functions like a correlation coefficient, i.e., by definition it cannot distinguish fast subcontractor activities in a fast project from slow activities in a slow project. This research therefore refines schedule beta by breaking it into its downside and upside constituent parts of schedule performance, again inspired by finance. An exemplar is reanalyzed to demonstrate its functioning and explain different types of subcontractor performance. Results confirm the feasibility of extracting the downside and upside schedule beta, which can support the goal of keeping projects on time.
Subcontractor Schedule Performance: Finance-Inspired Schedule Beta Indices
Lucko, Gunnar (author) / Thompson, Richard C. (author) / Su, Yi (author) / Huynh, Huu T. (author)
Construction Research Congress 2020 ; 2020 ; Tempe, Arizona
Construction Research Congress 2020 ; 525-534
2020-11-09
Conference paper
Electronic Resource
English
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