Project Changes: Sources, Impacts, Mitigation, Pricing, Litigation, and Excellence

Cooper, Kenneth; Reichelt, Kimberly Sklar

doi:10.1002/9780470172391.ch31

Cited by 8 publications

(8 citation statements)

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“…Change management entails pricing and mitigating proposed changes as they occur on an ongoing project (rather than waiting for disputes to occur after the project ends). Cooper and Reichelt (2004) demonstrate that the full cost of changes, including ripple effects, increases nonlinearly with the cumulative size of all changes, and as the changes occur later in the project. Eden et al (2000) call these "Portfolio Effects", where combinations of changes produce impacts greater than the sum of the individual impacts alone.…”

Section: Change Management Risk Management and Project Controlmentioning

confidence: 99%

System dynamics applied to project management: a survey, assessment, and directions for future research

Lyneis

Ford

2007

System Dynamics Review

332

305

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One of the most successful areas for the application of system dynamics has been project management. Measured in terms of new system dynamics theory, new and improved model structures, number of applications, number of practitioners, value of consulting revenues, and value to clients, "project dynamics" stands as an example of success in the field. This paper reviews the history of project management applications in the context of the underlying structures that create adverse dynamics and their application to specific areas of project management, synthesizes the policy messages, and provides directions for future research and writing. Copyright © 2007 John Wiley & Sons, Ltd. Syst. Dyn. Rev. 23, 157-189, (2007 ContextProjects abound in industry, public service, and many other endeavors. As a series of activities or tasks that (1) have a specific objective (scope) to be completed within certain specifications (requirements); (2) have defined start and end dates; (3) have funding limits; and (4) consume and/or utilize resources (Project Management Institute, 2000), projects have proven challenging to plan and manage. This is largely because project conditions and performance evolve over time as a result of feedback responses, many involving nonlinear relationships, and to accumulations of project progress and resources. This has made the application of system dynamics to project management a fertile and productive field of study. This paper surveys the large body of system dynamics work on projects, evaluates its progress, and suggests directions for future development.Many different types of models have been developed to improve project management. These models include some of the system features and characteristics addressed by system dynamics. For example, basic project models such as the critical path method explicitly model causally linked development activities and phases and cost control models use forecasted performance gaps (e.g., budget deficits) to allocate funds. More advanced models, such as the computational models developed by Levitt et al. (1999) and others, are quite system dynamics-like, as they include linked development activities as well as feedback. Another body of work models multiple projects, using system dynamics as well as other approaches. Surveying all of these works is beyond the scope of a single article. Therefore, we focus here on models of single projects built using the system dynamics methodology. But even models of single projects are too numerous to describe their structures or applications in detail. Therefore, in this article we focus on the most important and general model structures in conceptual form, and provide references to additional details. Our work is based primarily on the published literature and our experience using system dynamics to model projects. In particular, we describe contributions resulting from work we have done that has not, and very likely never will be, published or otherwise made available.The literature on system dynamics models of pro...

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Section: Change Management Risk Management and Project Controlmentioning

confidence: 99%

System dynamics applied to project management: a survey, assessment, and directions for future research

Lyneis

Ford

2007

System Dynamics Review

332

305

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“…However, a performance shortfall too big simply causes frustration because the performance gap appears to be too big to close. This frustration lowers employee motivation and, in turn, actual performance (Sterman 2000;Cooper and Reichelt 2004;Lyneis and Ford 2007). As schedule pressure increases, motivation begins to increase at an increasing rate.…”

Section: Literature Reviewmentioning

confidence: 99%

Discovering the Impact of Late Change Orders and Rework on Labor Productivity: A Water Treatment Case Study Analysis Using System Dynamics Modeling

Kermanshachi

Thakur

Govan

2018

Construction Research Congress 2018

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Most complex projects can expect some level of rework and minor changes that can be conceptually predicted and estimated during the bidding process. However, existing literature and practitioners' experience indicate that the true impact of late change orders and rework on labor productivity behavior is often greater than expected, and the unintended side effects are very difficult to measure. This lack of knowledge and understanding leads to inaccurate calculations of the true impact of project changes and creates an incorrect ground for future decisions. Therefore, this research aims to develop a system dynamics model to understand and analyze the fluctuations in the field labor productivity rate and behavior in response to changes in the scope of the project. The other objective of this study is to formulate and discuss management policies that limit these undesirable side effects and their implications. Based on a large-scale design-bid-build water treatment project, this research conducts a case study to monitor the behavior of changes in productivity rate due to different scale change orders. The simulation results show that if a project falls behind schedule due to a change and the project deadline remains fixed, schedule pressure leads to an initial increase in productivity up to a certain level, but eventually may lead to major employee frustration. This frustration has the potential of increasing the project duration further and makes a bad situation even worse. Schedule pressure further exacerbates the problem by typically increasing the rework fraction or the errors on the built work packages. The outcome of this study helps practitioners to utilize the developed model to monitor and track labor productivity rate changes in each individual construction project and manage institutional overtime policies accordingly. ITRODUCTIONChange orders in construction projects result from a change in scope of work from the originally agreed upon work between the Owner and the Contractor. A change order is "a written order to the contractor signed by the owner and architect, issued after execution of the contract, authorizing a change in the work or an adjustment in the contract sum or the contract Time" (American Institute of Architects, 1977). Change orders may result from a number of reasons such as a discrepancy in the design documents, change order directives given by the owner, and unforeseen/differential site conditions. Change orders have a significant impact on project performance in terms of delay in project schedule, increase in cost through rework and decrease in labor productivity.

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“…To quantify the effect of changes, Cooper and Reichelt (2004) have performed simulations of the aggregated disruptions caused by changes. Other approaches to project simulation that can illustrate the effect of changes include Kunz et al (1998) and Kunz et al (2000).…”

Section: Literature Review Of Previous Research On Project Changesmentioning

confidence: 99%

“…They particularly pointed to problems in finding a reference point that describes the performance of a project in a period when the project was not disturbed by changes. To quantify the effect of changes, Cooper and Reichelt (2004) have performed simulations of the aggregated disruptions caused by changes. Other approaches to project simulation that can illustrate the effect of changes include Kunz et al (1998) and Kunz et al (2000).…”

Section: Literature Review Of Previous Research On Project Changesmentioning

confidence: 99%

Post‐project changes: occurrence, causes, and countermeasures

Andersen

Olsson

Onsøyen

et al. 2011

International Journal of Managing Projects in Business

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Purpose -This purpose of this paper is to investigate the volume and background of changes done shortly after project completion. Design/methodology/approach -To ensure a consistent set of projects, selection criteria were related to project budget, time of completion, and executing institution. Data collection included an initial survey followed by interviews. Findings -The study identified frequency and extent of changes/alterations within a certain period after project completion as well as the dominating causes for such changes.Research limitations/implications -The study is based on a limited number of projects and from three specific Norwegian agencies. Future research should include a larger sample, possibly also covering other sectors. Practical implications -If acted upon, the suggestions for countermeasures can contribute to reducing or preventing post-project changes. The findings indicate a need for new performance measures for projects, as the classical parameters provide motivation to project managers and their teams to focus on project cost and timely delivery, rather than the life-cycle cost. Social implications -In sectors experiencing a widespread occurrence of changes after project completion, this could mean that cost overruns or functionality beyond what was sanctioned by the financing bodies are "hidden" in this type of change work. If so, this prevents sponsors and society from seeing the real project cost, and is clearly a misuse of resources. Originality/value -This paper contributes to the limited literature focusing on changes after project completion. The paper includes material that may help project managers and project owners avoid post-project changes and the costs and inconvenience associated with such changes.

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Project Changes: Sources, Impacts, Mitigation, Pricing, Litigation, and Excellence

Cited by 8 publications

References 0 publications

System dynamics applied to project management: a survey, assessment, and directions for future research

System dynamics applied to project management: a survey, assessment, and directions for future research

Discovering the Impact of Late Change Orders and Rework on Labor Productivity: A Water Treatment Case Study Analysis Using System Dynamics Modeling

Post‐project changes: occurrence, causes, and countermeasures

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