10.07.2015 Views

Link to thesis - Concept - NTNU

Link to thesis - Concept - NTNU

Link to thesis - Concept - NTNU

SHOW MORE
SHOW LESS

Create successful ePaper yourself

Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.

lowered the quality but the volume remained the same as planned. A common type of reduction for roads wasrelated <strong>to</strong> planned actions on existing roads in connection <strong>to</strong> the new construction. These occasions are registered asreductions in quality. Adjustments of the ambitions related <strong>to</strong> the visual impression of the project delivery might beseen as a subgroup of quality reductions. Due <strong>to</strong> its frequency in transportation infrastructure projects in particular, itis presented as a separate category. Common examples of this category include planting fewer trees, lower ambitionas <strong>to</strong> establishing lawn and lower ambitions for the esthetic appearance of concrete walls. Reductions in volumerelate <strong>to</strong> number of items delivered, fewer kilometers of road etc. The dependencies between different projects weretypically of the type that “if another project includes this particular delivery in their scope, we can take it out of ourscope”. Finally, any type of reduction that did not match the identified categories is listed as “other”. As can be seenin Table 5, quality and volume issues were most frequent and represented the largest monetary value.Total observationsAmountType of reduction Number Percent Mill. NOK PercentFlexibility in the product 9 5 % 70 3 %Quality, functionality 71 42 % 804 36 %Visual impression 22 13 % 239 11 %Volume 48 28 % 864 39 %Dependencies betweenprojects 4 2 % 41 2 %Other 15 9 % 221 10 %Total 169 100% 2 239 100%Table 5. Reductions by type, frequency and size. Based on data from 37 projects.Several concerns regarding the scope reductions are raised. One issue is related <strong>to</strong> cost sharing between stakeholders in the projects, for example between the government represented by the Public Roads Administration on theone hand, and the local counties on the other hand. Some type of scope reductions may only represent a relocation ofthe cost.A similar discussion related <strong>to</strong> weighing investments versus maintenance cost is also present for many projects. Insome cases, it is commented that future maintenance cost becomes neglected by the use of a fairly high discount ratein cost/benefit calculations.In many cases, reductions are claimed <strong>to</strong> only be possible by reducing the volume of the projects, for example interms of highway meters or defense equipment units. A common comment is that by reducing the volume, the unitcost will increase in the projects because of fixed costs. There is also a tendency <strong>to</strong>wards frustration because theprojects have been through several rounds of reductions <strong>to</strong> focus the scope prior <strong>to</strong> the external quality-at entryanalysis, where a new round of reductions is asked for.The need for fast decisions regarding possible reductions is very common. According <strong>to</strong> one consultant, reductionsin system architecture and quality standards have <strong>to</strong> be made early in the projects. Reductions in volume are possible<strong>to</strong> make at later stages, depending on the contract structure. Another common comment is that the potential volumeof the reductions is so small that it is not justified <strong>to</strong> set up a system <strong>to</strong> manage reductions.The purpose of the reduction lists is <strong>to</strong> have possibilities <strong>to</strong> reduce the scope in response <strong>to</strong> cost overruns. A majorchallenge is that the due dates for the reductions typically comes before one can expect that project managementhave updated cost estimates that may indicate potential overruns.11

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!