Various Approaches to Early Contractor Involvement in Relational Contracts
Abstract The main rationale for involving contractors is to apply collaboration to mitigate risk and to harvest opportunities to reduce cost and to increase the project owner’s value. In the paper we argue in the applied analytical model that there are four levels of early contractor involvement (ECI), which are 1) Preparation of the project (before sparking off competition); 2) During the procurement phase (development of what to build); 3) Project delivery model (before construction contract, but after the contractor and designers are selected); 4) Project delivery model (where involvement also continues in the execution phase). In the paper we argue that category 4 have the largest poten…
Development of target cost – By the owner or together with Contractors - Target Value Design
Abstract Cost growth and cost overrun of projects is a well-researched topic, but still a recurring problem. Some of the problems may be attributed to the difficulties of setting a realistic cost estimate in the early phase of the project. This paper aims to give insight o the challenge of setting realistic cost targets. We particularly focus on large and complex infrastructure projects in the context on the Norwegian construction industry. Four large infrastructure projects have been examined, all used a variation of target cost and was more or less successful in their implementation of this approach. Through interviews and document study we identified that when setting cost targets for pr…