Improvig NEC Cotract Chage Maagemet with CCM Professor Mig Su Tejas Oza Jue 2008
The Authors Professor Mig Su is the Director of Costructio ad Property Research Cetre at the Uiversity of the West of Eglad. He is a leadig expert i Costructio IT research. He has led may research projects, icludig a EPSRC fuded Maagig Chage ad Depedecy i Costructio Projects (2001-2004). His publicatios iclude a book o Uderstadig IT i Costructio, published by SPON Press i 2004. Mr Tejas Oza is the KTP Research Associate for this project. For further iformatio cotact: Professor Mig Su Director Costructio ad Property Research Cetre School of the Built ad Natural Eviromet Uiversity of the West of Eglad Coldharbour Lae, Bristol, BS16 1QY, UK Tel: 0117 32 83006 E-mail: mig.su@uwe.ac.uk Kowledge Trasfer Partership (KTP) projects are fuded by the Techology Strategy Board with 17 other fudig orgaisatios. They offer compaies the opportuity of a three-way lik with a Uiversity ad a recet graduate to work o a specific project that has strategic importace to their busiess. For more iformatio visit: www.ktpolie.org.uk Maagemet Process Systems (MPS) is a maagemet services compay whose missio is to deliver iovative solutios that create compellig busiess advatage save moey ad reduce risks. The Cotract Chage Maagemet (CCM) system is oe of its core services. For more iformatio visit: www.mpsprocess.com
CCM Report Table of Cotets Foreword... 3 Executive Summary... 4 1. What is CCM?... 5 2. What Are the Beefits of CCM?... 5 2.1 What do CCM users thik?... 5 2.2 What do seior executives thik?... 7 2.3 Ca these beefits be measured?... 7 3. Quatifyig Tagible Beefits... 8 3.1 Early Warig... 8 3.2 Compesatio Evet... 8 3.3 Value Chage before Istructio... 9 3.4 Value Chage after Istructio... 9 3.5 Spreadsheet tool... 10 4. Measurig Itagible Beefits... 10 4.1 What is a Capability Maturity Model?... 10 4.2 What do levels of maturity mea?... 12 4.3 What are the Key Process Areas?... 12 4.4 How is the assessmet coducted?... 15 5. Case Studies... 16 6. Summary... 18 Bibliography Appedix A Ackowledgemets 1
List of Figures Figure 1 Figure 2 Figure 3 Screeshot of tagible beefits calculatio tool Two differet represetatios of CMMI Case studies itagible beefits assessmet List of Tables Table 1 Table 2 Table 3 Table 4 Table 5 Table 6 Top 20 beefits of CCM Maturity levels i cotract chage maagemet Key Process Areas of CM3 Chage Maagemet Maturity Model (CM3) Matrix Brief descriptio of differet assessmet methods Case studies ad tagible beefit calculatio results 2
CCM Report Foreword Havig writte the Foreword to the iterim research paper o this subject back i November 2006, I was delighted to be asked to provide a few more words ad thoughts for this fial report. I a world where improved performace is expected, ideed ofte demaded, iovatio coupled with commitmet to ad belief i ew ideas are key success factors. Cotract Chage Maagemet (CCM) uses the disciplie of process as a busiess tool for maagig the kowledge ad itelligece of people to eable delivery of real commercial value to project outcomes. The iovatio of usig a iformatio techology based system to brig the disciplie of process to project maagemet is ow well established ad has bee ackowledged by the Costructio Idustry with its 2006 Q.S Iovatio Award ad the 2007 Costructio Computig Award for CCM. This report by Professor Mig Su sets out both the tagible ad itagible beefits of the CCM process support service for NEC based projects. However the geeric ature of CCM is such that the process ca be applied to ay costructio project whatever the Form of Cotract. This is a importat output of the study report because ivariably cost (tagibles) ad value (itagibles) are essetial performace idicators dictatig the procuremet ad delivery strategy for costructio projects. I particularly like the cocept of the Maturity Model which is essetially a matrix maagemet tool that ca be used by cliets, cosultats ad cotractors alike as measures for takig their busiesses beyod their curret stadards to better, quatifiable, fiacial maagemet performace levels. The report also recogises that ot all busiesses are at the same level of NEC/CCM kowledge or usage ad i this respect the maagemet tool ca be tailored to idividual eeds ad objectives. This is a comprehesive ad worthwhile study directed at reducig busiess risk by improvig the maagemet of projects. Its fidigs ad recommedatios represet a move to improvemet ad best practice! But best practice requires practice so I hope those seekig to improve their costructio maagemet performace will seek guidace from this study report. David H Williams, CEg, FICE Foudig Chairma of NEC Users Group 1994-1997 3
Executive Summary This report presets the fial fidigs of a two-year research project o measurig the beefits of a collaborative ad workflow IT busiess support system for NEC projects. The Cotract Chage Maagemet (CCM) system was the basis of the research carried out by the Uiversity of the West of Eglad ad partially fuded by the govermet Kowledge Trasfer Partership programme. The New Egieerig Cotract (NEC), iitially published i its cosultative form i 1991 ad ow i its third editio, facilitates the implemetatio of soud project maagemet priciples ad practice. It ecourages the trasitio from the adversarial culture to a collaborative oe i costructio. The mai aspect of this trasitio is movig away from a reactive ad hidsight based decisio-makig ad maagemet approach to oe that is foresight based, ecouragig a creative eviromet with pro-active ad collaborative relatioships. However, the NEC cotract requires project maagers to be o top of thigs o a daily basis. This is quite a oerous resposibility o the project maager. Daily meas that they must have global ad updated iformatio o cotract status i order to esure that the cotract is operated with miimum delays ad that costs are properly cotrolled. CCM is a iteret delivered collaborative system, provided by Maagemet Process Systems Ltd (MPS), which supports the implemetatio of the cotract chage maagemet process. It has bee used o hudreds of buildig ad egieerig projects i the UK. A user survey, coducted i August 2006, showed that 84% of the CCM users cosider it as a good or excellet system. Accordig to the users, CCM offers a rage of both tagible ad itagible beefits. Detailed survey results are published i a iterim research report, etitled Collaboratio Support Realises Busiess Process Beefits for NEC/ECC Projects The Iteret CCM System, i November 2006 by the Uiversity of the West of Eglad. It is available at: [http://www.built-eviromet.uwe.ac.uk/research/cprc/publicatios/ccm-ov2007.pdf] Followig the survey, this research has developed methods for measurig both tagible ad itagible beefits of CCM. Tagible beefits refer to cost ad time savigs as a result of adoptig CCM, which ca be quatified i fiacial terms. The measuremet of tagible beefits focuses o four key chage maagemet tasks that CCM supports. These are Early Warig; Compesatio Evet; Value Chage before Istructio; ad Value Chage after Istructio. The process of each task is aalysed for whe CCM is used ad whe it is ot used. Savigs for each task are calculated through detailed process aalysis of how the task is carried out with ad without CCM. A spreadsheet tool is developed to allow users to assess the tagible savigs of usig CCM i their project by simply eterig the umbers of times that these four tasks are performed. For example, for a typical project with 100 early warigs, 110 compesatio evets, 30 istaces of value chage before istructio ad 80 istaces of value chage after istructio, a savig of over 52,000 ca be gaied i staff time ad cosumable costs. I additio to tagible savigs, CCM ca also help project teams to improve process effectiveess, reduce risk of process failures ad icrease compliace with NEC requiremets. These beefits are itagible, which caot be easily measured i fiacial terms. However, they are as importat as tagible beefits. I may cases, they are more importat because greater certaity ad predictability ad less risk ca potetially lead to bigger savigs. This research adopted the Capability Maturity Model approach, origially proposed by the Software Egieerig Istitute at Caregie Mello Uiversity i 1991, to evaluate the itagible beefits of CCM. A Chage Maagemet Maturity Model (CM3) is developed, which provides a measuremet framework for assessig a project team s capability i dealig with cotract chages. The Model defies five levels of maturity ad hoc, iformal, systematic, itegrated ad cotiuous improvig. Measuremet is carried out o six key process areas maagemet process, risk maagemet, commuicatio, maagemet iformatio, collaboratio, ad leadership/objectives. Three case studies have bee carried out. It is foud that CCM, i cojuctio with NEC, helps to improve project teams maturity level i these key process areas from typical levels 1 ad 2 to levels 3 ad 4. 4
CCM Report 1. What is CCM? The Cotract Chage Maagemet (CCM) system is a iteret delivered collaboratio system which supports the cotract chage maagemet process for the NEC form of cotract. The success of NEC projects depeds o all the parties followig the operatig procedures. Ufortuately, i practice may projects foud compliace with these procedures difficult usig a paper based maagemet system. The CCM system is specifically desiged to electroically support the NEC maagemet process. NEC was edorsed by Sir Michael Latham i his Costructig the Team report ad by the Office of Govermet Commerce (OGC) i their advice for public sector costructio procuremet. It has bee used i may prestigious projects, such as Heathrow Termial 5, the Ede project, the Cross Chael Rail Lik (CTRL), ad lately the Lodo 2012 Olympic Games projects. NEC is ot just a cotractual documet that defies the legal relatioships betwee the project parters. More importatly it is also a maagemet tool to esure the smooth delivery of a project: NEC ecourages proactive maagemet of project risks. The cotractor ad the project maager are required to give a Early Warig (EW) as soo as they become aware of somethig that might cause a icrease i cost, delay i completio or egative impact o performace. Cotractors ca be pealised for failure i raisig EWs. NEC defies a clear procedure for tasks ad resposibilities after a EW is raised, ad how it feeds ito the risk maagemet procedure. It requires each party to take appropriate actios promptly. Matters caot be left uaddressed. There are cosequeces for failure i compliace with the procedure. NEC is a very admiistrative ad process based cotract. Audit trail is importat. All importat commuicatios must be i writig as verbal commuicatios have o cotractual relevace. NEC uses the programme as the baselie for maagig the project. Ay alteratio to the programme has to be agreed by all parties cocered. As chages are agreed durig the project, there are few surprises at the completio. May projects foud compliace with NEC procedures difficult usig a paper based maagemet system. CCM is a o-lie service specifically desiged to support all key NEC processes. The system maages the life cycles of all otices issued by the Project Maager (PM) ad Cotractor uder the NEC cotract, i a collaborative eviromet over the Iteret. These iclude Early Warigs (EWs), Project Maager Istructios (PMIs), Compesatio Evets (CEs), Notificatio of Compesatio Evets (NCEs), Quotatios, Project Maager Assessmets (PMAs), Implemetatios, ad a variety of PM/Cotractor Commuicatios. All documets are user ad date stamped ad held i a audit trail. The impacts of CEs are moitored agaist the activity schedules for each work package, i order to esure that the adjusted target price ad target completio date are up to date. If ecessary, escalatio mechaisms are activated i order to highlight potetial delays to process executio requiremets. Durig the last few years, the CCM system, provided by Maagemet Process Systems Ltd (www.mpsprocess. com), has bee used by a growig umber of compaies i the UK. Based o aecdotal evidece, may users are coviced of the beefits of the system i helpig them reduce risks ad save costs. 2. What Are the Beefits of CCM? 2.1 What do CCM users thik? A questioaire survey was coducted with CCM users durig August 2006. The aim was to fid out their views o the beefits of the system. The questioaire was set to 260 radomly selected CCM users ad 85 (33%) valid replies were received. The respodets icluded Mai Cotractors (40%), Cliet Orgaisatios (21%), Cosultat Quatity Surveyors (15%), Project Maagemet Cosultats (14%) Architect/Desig/Egieerig (5%), Specialist Sub Cotractors (1%), ad Others (4%). The survey result shows that the vast majority of users (84%) regard CCM as a Good or Excellet system. 5
I order to fid out users views o the beefits of CCM i specific aspects, 43 potetial beefits i 8 categories were idetified prior to the survey. These categories were: (1) Process improvemet; (2) Busiess improvemet; (3) Risk maagemet; (4) Commuicatio; (5) Maagemet iformatio; (6) Efficiecy; (7) Collaboratio/Parterig; ad (8) Traceability. A questio was posed i the questioaire, which read: aecdotal evidece idicates CCM offers the followig beefits. Do you agree? Users were asked to choose oe from 4 possible aswers - Strogly agree, Agree, Disagree or Strogly disagree. The results showed that there is a high degree of cosesus o the beefits of the CCM system i these key project maagemet aspects. 41 out of 43 beefits received positive ratig. Table 1 lists the top 20 beefits accordig to the level of support from CCM users. Table 1 Top 20 beefits of CCM Rakig Descriptio % of support 1 8.2 Date stamps all key operatios 99% 2 7.1 Access to process operatio/status by the team 98% 3 3.2 Provides a documeted audit trail 97% 4 3.7 Improves compliace to NEC procedures. 93% 5 4.2 Documets are ot lost or mislaid 93% 6 7.2 Assures documet versio cotrol 93% 7 1.2 Rigorous process support 92% 8 8.1 Archives of key documets for aalysis 91% 9 4.7 Records commuicatios: PMI, EW, CE, NCE 91% 10 5.1 Data ca be aalysed durig/after the cotract 91% 11 5.2 Cotract progress with date stamps 91% 12 4.4 Facilitates moitorig by seior maagemet 90% 13 7.4 Highlights ext actio ot be igored/forgotte 90% 14 1.1 Quality assured chage maagemet process 89% 15 3.3 Provides early warig otificatio of risk 89% 16 3.1 Greater visibility of status of all icidets 88% 17 4.3 E-mail otificatio for importat actios 86% 18 4.5 Istat availability of latest cotract prices 84% 19 3.6 Proactive maagemet of early warigs 83% 20 6.1 Simple, poit ad click operatio process 83% A user survey revealed that CCM helps the cotract chage maagemet process of NEC projects. 84% of the users cosider the system as good or excellet. As previously stated, for NEC projects process is extremely importat. Whe a compesatio evet occurs, the requiremet of otificatio ad acceptace by all the pricipal parties is clearly defied i the cotract. The party who fails to take appropriate actio i time will risk losig moey or time. It is therefore ot surprisig that CCM fuctios related to Traceability scored very highly with 8.2 Date stamps all key operatios at umber 1 ad 8.1 Archives of key documets for aalysis at umber 8. Similarly, Process Improvemet related beefits, such as 1.2 Rigorous process support ad 1.1 Quality assured chage maagemet process are also high o the list. Compared with other forms of cotract, NEC projects geerate more writte iformatio i the form of early warigs, otificatios, quotatios, project maager istructios, etc. This iformatio eeds to be maaged effectively. CCM users really appreciate the Commuicatio ad Iformatio Maagemet fuctios provided by the system, e.g., 4.2 Documets are ot lost or mislaid, 4.7 Records commuicatios: PMI, EW, CE, NCE, 5.1 Data ca be aalysed durig/after the cotract, 5.2 Cotract progress with date stamps, 4.3 E-mail otificatio for importat actios, ad so o. The key priciple of NEC is about proactive ad more effective risk maagemet durig costructio projects. I additio to project risks, there is a greater risk of process failure because of the demadig compliace requiremets. Accordig to the survey, CCM ca help to reduce such a risk through 3.2 Provides a documeted audit trail, 3.7 Improves compliace to NEC procedures, 3.3 Provides early warig otificatio of risk, 3.1 Greater visibility of status of all icidets, 3.6 Proactive maagemet of early warigs, ad 7.4 Highlights ext actio ot be igored/ forgotte. Further details of the survey results ca be foud i the iterim research report (source is give i the Executive Summary). 6
CCM Report 2.2 What do seior executives thik? I additio to the questioaire survey, three seior maagers/directors were iterviewed to obtai feedback o the beefits of CCM from their perspectives. They are from three separate cliet, cotractor ad egieerig cosultat orgaisatios. These seior executives, while ot ecessarily usig CCM hads o, maage a rage of projects where the system is used. Therefore, they are i a positio to assess the beefits of the system beyod the scope of idividual projects. The followig is a summary of the results of their iterviews: CCM provides support for cotiuous busiess improvemet. Oe of the commo methods of busiess efficiecy improvemet is cuttig waste by applyig Value Stream Aalysis to the existig processes. The audit trails captured i CCM are very useful i helpig seior executives i carryig out the ecessary aalyses. The project database held by CCM provides iformatio for seior executives to perform Root Cause Aalysis to idetify commo causes of cotract chages so that they ca be addressed proactively. CCM is a excellet traiig tool for the NEC cotract. The system, with its uderlyig NEC methodology, helps professioals who are ew to the NEC cotract to get up to speed with the NEC procedures quickly. CCM helps to esure that the NEC cotract procedures are implemeted correctly. Ay delays i respose are highlighted usig the thermometer fuctio. It makes the project maagemet process more trasparet ad puts pressure o all parties to perform well. CCM is a useful tool to eforce commo stadard practice across multiple projects. Without such a system, differet projects may adopt differet maagemet ad reportig procedures, leadig to difficulties i bechmarkig across them. The clear audit trail provided by CCM helps to resolve, eve avoid uecessary disputes. Whe used o a series of projects, CCM ca help seior executives to bechmark the performace of these projects ad achieve cotiuous improvemet. CCM helps to cotrol project risks, so that they will ot escalate out of cotrol. CCM helps to settle the fial accout more speedily. 2.3 Ca these beefits be measured? Sice the 1980s with the growig use of computers to support busiess process operatio, there has bee a cosistet iterest i measurig the beefits of IT. Back i 1984, the UK HM Treasury (1984) published a report outliig a method for evaluatig the impact of iformatio techology i govermet offices. It divided the IT beefits ito three categories: (1) those capable of quatificatio ad valuable i moetary terms; (2) those geerally quatifiable but difficult to value; ad (3) those idetifiable but ot quatifiable. This work iflueced may subsequet studies o measuremet of IT beefits. I the costructio sector, CIRIA (1996) ad the Costructio Idustry Computig Associatio udertook a study o quatifyig the beefits of IT i costructio orgaisatios. They carried out seve idepth case studies. The study highlighted the complexity of coductig cost/beefit aalysis for IT ivestmet. It recommeded that both tagible ad itagible beefits should be cosidered i ay aalysis. A subsequet study by the Costruct IT Cetre (1998) produced a formal framework for measurig the beefits of IT ivestmet. It suggested that IT beefits should be evaluated i It three perspectives: is importat efficiecy; to measure the effectiveess ad beefits of CCM so performace. A that its users ca see beefits matrix how much the system is was proposed helpig i savig costs by this study ad improvig cotract to facilitate the chage maagemet applicatio of processes. this measuremet framework. 7
Based o review of existig studies o measurig IT beefits, this research adopted a simplified beefit classificatio for measurig the beefits of CCM: tagible beefits ad itagible beefits. Tagible beefits refer to time ad cost savigs that ca be measured i moetary terms, while itagible beefits refer to capability improvemet of a project team i dealig with cotract chages. 3. Quatifyig Tagible Beefits Tagible beefits refer to cost ad time savigs achieved as a direct result of adoptig the CCM system i a project. Measuremet of tagible beefits is doe through comparig the ways that key cotract chage maagemet processes are hadled with CCM ad without it. Four such key processes are idetified Early Warig, Compesatio Evet, Value Chage before Istructio, ad Value Chage after Istructio. Detailed workflow aalysis has bee carried out o these four processes to idetify the sequece of activities for each process i traditioal practice. It further idetifies the average staff time ad likely cosumable costs for these activities, which are potetial savigs usig CCM. The aalysis results have bee validated through iterviews with NEC experts ad practitioers. The followig is a summary for each process. 3.1 Early Warig Early Warig (EW) is the most commo procedure i NEC projects. It usually starts whe oe party of the project team otices a potetial risk ad iforms the project maager. The maager eeds to idetify the risk uder the appropriate cotract clause by referecig the cotract; ad the issue the EW documet to other parties. Whe these warigs are reviewed at risk reductio meetigs, duplicate EW documets ofte eed to be prepared. Followig the risk review, decisios eed to be recorded ad circulated to the whole team. The whole process requires sigificat admiistrative support. Icomig ad outgoig documets eed to be registered ad filed for future referece. I a paper based project, the costs for a typical early warig iclude the pritig of multiple documets, postage costs for circulatig otificatios ad istructios, ad admiistrative staff costs. Furthermore, there are delays ad risk of loss whe documets are set through the post. I practice, documets are sometimes ot registered or filed properly due to busy schedule i the office. Whe a cotract falls ito adjudicatio there is ofte a lack of valid audit trail or importat documets might be missig, which may lead to the loss of a legal dispute. Usig CCM, early warigs ca be issued directly by eterig iformatio to the cetral server. The project maager ca review the warigs o the system ad circulate iformatio to all parties through CCM. This elimiates the eed for pritig, postig ad filig documets maually. For each EW, the estimated tagible savigs, as a result of usig CCM, iclude 1.15 cosumable costs ad approximately 30 admiistrative staff costs (1.50 hours at 20 per hour) ad 137.50 maagerial staff time (2.75 hours at 50 per hour). 3.2 Compesatio Evet Compesatio Evet (CE) is oe of the processes uder cotract chage maagemet where cotract otices are issued by the PM i the evet of cotract chages. It provides a effective procedure for assessig ad agreeig the time ad cost effects of the evets as they occur ad i a timely maer. Wastes ad risks with paper based processes Costs of pritig multiple copies of documets Delays i postage of documets Costs ad delays with filig ad retrievig documets Crucial documets missig Cofusio caused by differet versios of the same documet Lack of reliable audit trails Usig CCM, otificatio ad quotatio are submitted o-lie ad recorded automatically by the server. It greatly improves the commuicatio speed betwee the project parters ad reduces the routie eed for paper filig ad copyig. 8
CCM Report I a traditioal paper based system a CE documet is prepared i the form of a letter, fax, or email by the project maager. The maager has to refer to the cotract itself to fid the appropriate clauses to refer to before makig ay decisios. Some CE decisios eed to be approved by seior maagemet ad agreed by other project parters. CE documets represet alteratios to the origial cotract. They eed to be formally issued to all parters ivolved. Usig a paper based commuicatio method a CE process ca take days before the maager receives the ecessary iformatio whe makig decisios. For every CE, the parters ivolved have to maitai a audit trail by loggig both icomig ad outgoig commuicatios. This requires maagerial, admiistrative staff time. It also icreases the risks of makig mistakes ad errors. Usig CCM, all CE commuicatios are carried out through the CCM server, which automatically provides a audit trail. The system also helps to esure that decisios are made i a timely maer i accordace with NEC requiremets. For a typical CE, CCM ca save a project 0.76 i cosumable costs, 23.40 i admiistrative staff costs (1.17 hours at 20 per hour), ad 71 i maagerial staff costs (1.42 hours at 50 per hour). 3.3 Value Chage before Istructio This process reflects the valuatio of a potetial chage (CE) before a Istructio is issued by the project maager. Although this is preferable, it is a rare occurrece i reality because the time required to carry out this process is ot usually available. I the traditioal situatio, the process of pre-agreed value of a proposed chage is followed i a similar maer as other processes. The maager issues a Istructio seekig a quotatio for a proposed chage. The Cotractor prepares a price kow as the Cotractors quotatio. Most maagers seek the advice of a Quatity Surveyor to check ad agree the price. Here the documet is prepared i similar maer as other NEC processes with associated cosumable costs as well as maagerial ad admiistrative staff costs. Documets eed to be set to other parties for review ad thus ivolvig delays i post ad also risks of loss i trasit. Usig CCM, all the commuicatios of this process ca be hadled o-lie through the system. For each istace, it will result i tagible savigs of 0.76 cosumable costs, 28.4 admiistrative staff cost (1.42 hours at 20 per hour), ad 75 maagerial staff cost (1.50 hours at 50 per hour). 3.4 Value Chage after Istructio This is oe of the most expesive processes if carried out usig traditioal methods. The process is iitiated whe the Cliet s represetative issues a Chage Istructio or PMI. The PMI documet follows the otificatio cycle before reachig the Cotractor. It is the reviewed by the Cotractor who values the chage ad seds a Quotatio to the maager for acceptace. After receivig the Quotatio documet the maager ca either (1) reject the Quotatio ad carry out his ow assessmet; or (2) reject the Quotatio ad seek a ew valuatio; or (3) accept the chage. If the maager rejects the valuatio ad seeks a ew Quotatio, the cotractor has to re-value the chage ad repeats the process of otificatio till the value is accepted by both parties. This process becomes more expesive as the umber of egotiatio or assessmet cycles icrease. Eve worse, it ca slip ito a post project completio phase before there is a accepted agreemet. The NEC cotract sets out a umber of respose periods for these cycles but they are ofte igored or exteded. The traditioal commuicatio methods sometimes cause delays durig this process ot to metio the costs i staff time ad cosumables. Usig CCM, the speed of commuicatio is greatly icreased. It helps to improve the otificatio ad egotiatio process ad leads to quicker agreemet. I additio, it also produces tagible savigs of 2.99 cosumable costs, 53.4 admiistrative staff cost (2.67 hours at 20 per hour), ad 196 maagerial staff cost (3.92 hours at 50 per hour). 9
3.5 Spreadsheet tool O the basis of aalysis of the above four processes, a spreadsheet tool is developed, which ca calculate the tagible beefits of CCM i a project (Figure 1). The calculatio oly requires some simple data iputs the umber of early warig geerated; the umber of compesatio evets; the umbers of value chage both before ad after istructio. These data are readily available to CCM users from the system log file reports. The spreadsheet tool will calculate (1) Cosumables costs savigs, (2) Staff costs savig, ad (3) Total savigs. The example i Figure 1 illustrates that Staff costs savigs cout for the majority of the tagible beefits of the CCM system. The spreadsheet may also be used for future projects to produce potetial cost savigs whe usig CCM. The uderlyig process aalysis is icluded i the spreadsheet tool. Users ca further customise it to reflect their processes more accurately so that makig the calculatio more reliable for them. The variables that ca be modified by the users iclude: Rates of maagerial ad admiistrative staff cost Uit costs for pritig ad postage Number of copies of documet circulatio Number of tasks of the four key processes The spreadsheet tool calculates the amout of tagible savigs for a NEC project as a result of usig CCM. It also shows where the savigs are made. Duratio for each task of the four key processes 4. Measurig Itagible Beefits By usig CCM, costructio projects ca improve compliace with NEC procedures, miimise process failures, ad icrease efficiecies. As a result, project teams ca deliver successful projects o a more cosistet basis. Beefits of this kid are itagible ad caot be easily measured i pure fiacial terms. Istead, the de facto idustry stadard Capability Maturity Model methodology is adopted for measurig the itagible beefits of CCM. 4.1 What is a Capability Maturity Model? The cocept of Capability Maturity Model (CMM) was origially proposed by the Software Egieerig Istitute (SEI) at the Caregie Mello Uiversity i 1991 (SEI, 2002 & 2006). It provides a framework to cotiuously measure, evolve ad improve the processes of software developmet. Subsequetly, CMM has bee adopted i other sectors, such as Structured Process Improvemet for Costructio Eterprises (SPICE) (SCRI, 2005), PRINCE2 Maturity Model (P2MM), Programme Maagemet Maturity Model (PMMM), Portfolio, Programme ad Project Maagemet Maturity Model (P3M3) ad Orgaisatioal Project Maagemet Maturity Model (OPM3) (APM, 2007). CMM was based o the widely accepted belief that the quality of a system or product is highly iflueced by the quality of the process used to develop ad maitai it. Figure 1 Screeshot of tagible beefits calculatio tool 10
CCM Report The purpose of CMM is to improve the processes of a orgaisatio, through which products ad services are delivered. It cotais the essetial elemets of effective processes for oe or more disciplies ad describes a evolutioary improvemet path from ad hoc, immature processes to disciplied, mature processes with improved quality ad effectiveess. The latest versio of this model is kow as Capability Maturity Model Itegratio (CMMI). It defies 22 geeric process areas, such as requiremet developmet, project moitorig ad cotrol, risk maagemet, measuremet ad aalysis, etc. It also defies five process maturity levels: Level 1 Iitial; Level 2 Repeatable; Level 3 Defied; Level 4 Maaged; Level 5 Optimizig. A maturity level is a thoroughly-defied patter ad characteristic of process behaviour of a orgaisatio. A more mature orgaisatio s busiess process is more reliable. Its performace is more predictable; less risk ad few surprises. CMMI has two differet represetatios: Staged ad Cotiuous (Figure 2). The Staged represetatio defies the required Process Areas, out of the total 22, at each of those five levels of maturity. It assesses a orgaisatio agaist the existece or absece of these Process Areas ad produces a overall Maturity Level ratig. For example, a orgaisatio with o process improvemet programme is usually at the lowest level of maturity Level 1. As it adopts the appropriate goals ad practices of processes defied at higher levels, the orgaisatio ca progress through the maturity hierarchy. At the other ed of the spectrum, a Maturity Level 5 orgaisatio is expected to have cotiuous improvemet processes, such as Orgaisatioal Iovatio ad Deploymet, ad Causal Aalysis ad Resolutio. Cotiuous represetatio of CMMI has the same 22 Process Areas. However, rather tha allocatig Process Areas to differet maturity levels, it assesses all the Process Areas agaist the maturity level from 0 to 5. The Maturity Level 0 is added to idicate that a particular Process Area is oexistet. This approach allows greater graularity i the capability measuremet. It recogises that some higher level Key Process Areas might be partially achieved i a overall lower level of maturity orgaisatio. It will also allow orgaisatios to idetify their stregths as well as weakesses. For example, a orgaisatio ca reach capability level 2 i oe process area but capability level 4 i aother. Followig the priciple of the CMMI Cotiuous represetatio, a Chage Maagemet Maturity Model (CM3) is developed i this study. It is a measuremet framework that specifically aims at assessig a project team s capability i dealig with cotract chages durig costructio ad egieerig projects. A typical project team cosists of members from differet orgaisatios, such as cliet, cotractor, ad cosultat. CM3 focuses o the project team rather tha project parter orgaisatios. However, the capability of the orgaisatios will o doubt have a impact o the capability of the project team. Figure 2 Two differet represetatios of CMMI 11
4.2 What do levels of maturity mea? CM3 defies five differet levels of capability maturity with regards to cotract chage maagemet. Their characteristics are summarised i Table 2. Table 2 Maturity levels i cotract chage maagemet MATURITY LEVEL Level 1 Ad-hoc chage maagemet Level 2 Iformal chage maagemet Level 3 Systematic chage maagemet Level 4 Itegrated chage maagemet Level 5 Cotiuous improvemet i chage maagemet DESCRIPTION A project team is characterised as ad-hoc or eve havig o chage maagemet processes i place. Few processes are defied or followed o a regular basis, ad success depeds o idividual effort ad their heroics. At this level a project team is i a dormat state as far as chage maagemet is cocered. Iformal chage maagemet processes are established. The ecessary istructio is i place to repeat earlier successes o similar programme with similar performace levels. However, it is ot eforced cosistetly. At this level, the project team is reactive to chages. A project team has set up systematic protocols ad procedures to repeat the processes. Process is cotrolled ad documeted accordig to pre-agreed set procedures. The project team is adaptive to maagig chages. The chage maagemet processes are itegrated throughout the team. Process is itegrated with other fuctios of project maagemet. There is a dedicated measuremet system. The project team is supportive to maagig chages. The chage maagemet process is cotiuously improved so as to prevet ay repetitio of ay failures. The mai focus is o learig ad improvig cotiuously. The project team is pro active towards chage maagemet processes 4.3 What are the Key Process Areas? A Key process area (KPA) refers to a cluster of related activities which aim at achievig a set of goals. The CM3 framework idetified six Key Process Areas (Table 3): Table 3 Key Process Areas of CM3 KEY PROCESS AREA DESCRIPTION Maagemet Process Risk Maagemet Commuicatio Maagemet Iformatio Collaboratio Leadership/Objectives Chage Maagemet processes help project teams to establish a stadardised procedure of workig ad hadlig project chages i the evet of their occurreces. The Chage Maagemet processes iclude all the evets right from the begiig of the occurrece till the completio of the chage. The purpose of assessig the maturity of project team s chage maagemet process is to evaluate the cosistece ad effectiveess of their chage maagemet procedures. Risk Maagemet helps to idetify, aalyse ad avoid the egative effects related with risks durig a project. It ivolves the use of stadardised documets for maagig ad reducig risks. The purpose of establishig Risk Maagemet maturity is to ascertai the existece of ay risk maagemet procedures i a project team ad how effectively ad efficietly these procedures are implemeted. The purpose of Commuicatio is to establish iformatio flow across the project team ad to esure that all the parters have the ecessary tools ad skills to share iformatio ad coordiate their activities efficietly. Its assessmet should iclude both the capacity of the commuicatio systems used ad the extet that capability is utilised by the project team. Maagemet Iformatio should esure that the project team is able to share iformatio i the most efficiet maer. The level of maturity i this aspect is determied by whether project iformatio is maaged effectively so that the right iformatio is provided to the right people at the right time ad i the right format. Collaboratio helps to improve trust ad cooperatio betwee the project parters i dealig with cotract chages. Good collaboratio promotes good teamwork. It will help to idetify project risks early ad avoid some uecessary chages. Whe a chage becomes ievitable, good collaboratio will help the project team to fid a optimum solutio. The purpose of Leadership/Objectives is to assess the ivolvemet of the Seior Maagemet i preparig the project team to deal with project chages. It also ascertais the objectives of the whole project team as well as of idividual project parters. Seior Maagers should esure that the project team has the required skills to perform the project tasks effectively ad provide ecessary traiig. 12
CCM Report Table 4 Chage Maagemet Maturity Model (CM3) Matrix Level 1 Ad-hoc Chage Maagemet Level 2 Iformal Chage Maagemet There are o cosistet chage maagemet procedures or practices. Ay chage maagemet process, that might exist, is ot shared by the whole team. The project team is reactive to chages rather tha aticipates them. There is a poor audit trail of the chage maagemet process. Chages are rarely reviewed after they occurred. Chage maagemet processes exist, however they are ot followed o a cosistet basis. May chages are hadled iformally without followig the correct processes. The project team is still largely reactive to chages rather tha aticipates them. Documetatio record is poor. Chages are sometimes reviewed after they occurred. Level 3 Systematic Chage Maagemet Chage maagemet processes are followed o a cosistet basis. The whole project team shares the same processes, although each team member may still operate a localised process i parallel. The project team begis to be proactive i aticipatig chages. Audit trail is recorded. There is a requiremet of review after a chage. Level 4 Itegrated Chage Maagemet Stadard chage maagemet processes are adopted ad followed cosistetly by the whole team. Processes are efficietly implemeted, possibly with the support of a IT tool. Most chages are maaged proactively. Chage maagemet audit trail is complete usig stadard documets ad forms. Chages are reviewed i various cotexts. Level 5 Cotiuous Improvemet Chage Maagemet performace evaluatio metrics are developed ad implemeted. Processes are moitored ad aalysed for potetial improvemet. The project team takes full advatage of techology support. Learig is regarded as a essetial part of Chage Maagemet process. Maagemet Process Risk Maagemet procedures are ad-hoc or ot preset at all. React after a problem occurs. No attempt is made to idetify risks or to develop cotigecy plas. Durig a crisis, plas are abadoed ad chages are made without clear uderstadig of their cosequeces. The project team is ot aware of key circumstaces that may impact the project budget ad schedule. Risk Maagemet is recogised by the project team. However roles ad resposibilities are ot well defied. Risk reviews are coducted iformally ad ot always effective. There is o systematic pla to deal with risks. Risks are ofte dealt with through idividual iitiatives. The project team does ot adopt ay tools to support the risk maagemet process. Risk Maagemet is recogised by the project team. All team members are aware of their roles ad resposibilities. There is a proactive risk maagemet system i place. The project team adopts appropriate tools to support the risk maagemet process. Decisio makig process ca be easily audited. Risk maagemet strategy ad system are clearly uderstood by the whole team. All team members are fully aware of their roles ad resposibilities. All project risks are maaged proactively i a coordiated fashio. The risk maagemet process is supported by IT tools. Risk maagemet effectiveess is regularly measured ad corrective actios are take whe required. Risk maagemet is embedded i the culture ad practice of the project team. All team members feel empowered to cotribute to the risk maagemet process. The risk maagemet kowledge is captured ad reused. Risk maagemet focus is o cotiuous improvemet, through regular reviews ad measuremet. Risk Maagemet There is o agreed project wide commuicatio strategy ad stadard protocol. Commuicatio is o a eed to kow basis oly ad uses multiple mediums, such as letter, phoe, e-mails, fax etc. Key decisios are made o the basis of iformal commuicatio. There is o audit trail. Commuicatio delay is prevalet. There is o way of kowig the commuicatio effectiveess. There may be a agreed project wide commuicatio strategy, but it is ot implemeted effectively. Commuicatio is doe usig multiple methods, such as letter, phoe, e-mails, fax etc. There is o effective commuicatio audit trail. Commuicatio delay is still a commo problem. Commuicatio problems are idetified by chace, ad ad hoc solutios are adopted. The same problem might occur agai. There is a project wide commuicatio strategy, ivolvig agreed systems to be used. Multiple commuicatio methods are still used for differet purposes. There is o cetral repository. There is some kid of record system to provide a audit trail. Commuicatio delay occurs occasioally. Commuicatio problems are idetified systematically, ad appropriate solutios are developed to prevet the same problem from occurrig agai. Commuicatio strategy is agreed at the begiig of the project. Commuicatio systems are put i place. IT based systems are used to provide a cetral hub for project iformatio exchage. The commuicatio system provides a istat audit trail. Commuicatio delay is rare. Commuicatio problems are aticipated before they occur. The commuicatio systems provide good process trasparecy. Good commuicatio makes positive impact o other aspects of the project. The commuicatio effectiveess is reviewed, measured ad improvemet is sought o a ogoig basis. Commuicatio 13
Table 4 Chage Maagemet Maturity Model (CM3) Matrix (cotiued) Level 1 Ad-hoc Chage Maagemet Level 2 Iformal Chage Maagemet There is o clearly defied iformatio maagemet strategy. A variety of disparate iformatio maagemet systems are used. Project iformatio is stored i differet places; ad difficult to retrieve. It is difficult to keep track of differet versios of the same documet. There are iformal agreemets o project iformatio maagemet. However, these are ot implemeted effectively Each project parter uses its ow iformatio maagemet system. Iformatio exchage is geeral doe through paper. There is o sigle iformatio storage. Iformatio retrieval is time cosumig. It is still difficult to keep track of differet versios of the same documet. There are formal agreemets o project iformatio maagemet, which is implemeted effectively There is a shared iformatio maagemet system. However, each project parter also maitais its ow system. There may be a sigle project iformatio repository. However, access cotrol relies o maual methods. Project iformatio is maaged i a disciplied maer. There is a clear iformatio maagemet strategy, which is implemeted effectively The team adopts the same iformatio maagemet system; ad uses it for all project iformatio. There is a sigle project iformatio repository, with proper access cotrol support. Update project iformatio is available istatly. There is a clear iformatio maagemet strategy fully shared by the whole team. The team use the same o-lie iformatio maagemet system, itegrated with decisio makig process. There is a commo project iformatio server, with proper access cotrol support. Project iformatio is maaged as a kowledge asset. Maagemet Iformatio The relatioship betwee project parters is adversarial. There is o effective team workig. Project risk is allocated to each parter ad maaged locally. Whe thigs go wrog, project parters blame each other. The relatioship betwee project parters is determied by cotract. Team workig does ot happe o a cosistet basis. Collaboratio depeds o the idividuals ivolved. Project risk is allocated to each parter, but maaged i a coordiated fashio. Whe thigs go wrog, the party at fault is always idetified ad blamed. The relatioship betwee project parters is collaborative. Team workig is ecouraged. However, it does ot always happe because of orgaisatioal or culture barriers. The project team works together to maage project risks. Whe thigs go wrog, the whole team helps to fid a solutio. A collaborative cotract is adopted. Team workig is expected. Project risks are shared ad proactively maaged by the whole team. There is a high degree of mutual iterest ad trust betwee the project parters. The project team is a partership supported by a collaborative cotract. Team workig is the orm. Kowledge is shared. High level trust is reiforced by appropriate measures, such as ope book accoutig. Collaboratio There is a lack of commo objective i the project team. The seior maagers are ot closely ivolved i the evet of chage or risk occurrig. Roles ad resposibilities are ot clearly uderstood. There is a weak leadership i the project team. The commo objectives are shared by part of the team. The seior maagers are iformally ivolved i the evet of chage ad risk. There is cofusio i the roles ad resposibilities of team members. Leadership is ot cosistet. Level 3 Systematic Chage Maagemet The team shares a commo objective ad work towards achievig it i the best possible maer. The project teams have high levels of motivatio ad seior maagemet ivolvemet. Seior maagers take a active role i overseeig the aims ad objectives of the project ad help to develop ecessary skills. Level 4 Itegrated Chage Maagemet The whole team shares a commo objective. Seior Maagers provide clear leadership i the evet of chage ad risk. Roles ad resposibilities are clearly uderstood at all levels. No blame culture is promoted. Level 5 Cotiuous Improvemet Cotiuous improvemet is a shared objective Necessary traiig at all levels is provided prior to immediate eeds. Effectively maagig chage is the goal of the project team ad seior maagemet. Performace measuremet is adopted. Leadership Objectives 14
CCM Report 4.4 How is the assessmet coducted? Whe choosig a assessmet method, you eed to cosider the purpose of your assessmet ad the amout of resources available. Followig the widely adopted priciple of CMMI, three differet assessmet methods (Class A, B ad C) are defied for usig CM3. Table 5 outlies a summary of these three methods. Table 5 Brief descriptio of differet assessmet methods METHOD Class A Class B Class C KEY FEATURES Fully comprehesive method Thorough model coverage Multiple corroborated evidece sources documets ad iterviews Requires idepedet lead assessor Miimum appraisal team size of 4 Produce reliable maturity ratig A relative legthy process Resource itesive i terms of staff time Implemeted as part of process improvemet drive Less comprehesive tha class A Ca be restricted to specific process areas Multiple evidece sources documets ad iterviews Doe iterally by the project team Miimum appraisal team size of 2 Focus o areas eedig attetio Time legth ad resource requiremets ca be variable Good iterim check before a Class A assessmet Quick review Ca be restricted to specific process areas Sigle evidece source documets or iterviews Doe by the project maager Miimum appraisal team size of 1 Iexpesive, little traiig is required Good for iitial gap aalysis The simplest assessmet (Class C) ca be doe by a sigle idividual, most likely the project maager of a project. It does ot require special traiig. The assessmet is doe easily by comparig the assessor s judgemet of the project team s capability ad performace agaist the maturity levels descriptio i the CM3 matrix. Clearly, the result of this method is more subjective. However, it is a quick ad easy way of idetifyig those areas where a project team might be doig well or those areas that the team is ot performig as well as expected. If the result reveals causes for cocer, e.g., uder performace i certai process areas or big discrepacies betwee maturity levels of differet process areas, further detailed assessmet may be recommeded. Class B assessmet method requires a small assessmet team which ormally icludes the project maager ad represetatives from the key project parters. The assessmet team still uses the CM3 matrix directly to assess the project team s levels of maturity i the key process areas. Because all key stakeholders of a project team are ivolved i this assessmet method, its results are better tha that of the Class C method i terms of accuracy ad objectivity. However, the assessmet still largely relies o subjective judgemets rather tha o documeted supportig evideces. As it is a relatively simple process, which ca be doe as part of the usual project review meetigs, it is good for team buildig ad promotig good relatioship betwee the project parters. Class A method provides the most comprehesive ad reliable assessmet of a project team s capability i dealig with cotract chages. I additio to the participatio of the key project parters, a idepedet facilitator is required i the core assessmet team. The facilitator eeds to be someoe who is from outside the project team ad is familiar with the CM3 framework ad its assessmet procedures. Usig this method, a assessmet goes through several phases: Plaig ad Preparatio phase: Durig this phase, a small core assessmet team is set up with miimum four members, icludig a represetative from each key project parter ad a idepedet facilitator. The team eeds to agree o the purpose ad scope of the assessmet. The facilitator should provide the ecessary traiig to other members o the CM3 assessmet methodology. At the ed of this phase, all parties should be committed to the exercise ad uderstad their roles ad resposibility, as well as be aware of the schedule of subsequet activities. Data Collectio phase: A questioaire (see a Extract i Appedix A) will be used to obtai feedback from all project participats, icludig those who are ot part of the core assessmet team. The questioaire cosists of 15
six sectios, correspodig to the six key process areas of the CM3 matrix. Each sectio has three questios. The project participats are required to complete the questioaire idepedetly. Data Cosolidatio ad Validatio phase: Durig this phase, the core assessmet team will review the questioaire resposes. Further iformatio may be obtaied through iterviews ad review of documetatios, especially whe there are discrepacies betwee aswers give by differet project participats. The aim is to esure that questioaire aswers are supported by solid evidece where possible ad iformatio from differet sources is validated ad corroborated. Ratig phase: The assessmet team will aalyse the data collected through questioaire ad iterviews durig the previous phase ad assess the maturity levels of the project team agaist the descriptio of the CM3 matrix. A maturity level ratig is assiged to each key process area based o collected evidece ad expert judgemet of the assessmet team. Ratig is ot doe automatically through a computerised algorithm. Differet maturity levels may be awarded to differet key process areas. For example the project team may score a maturity level 4 for Maagemet Process ad maturity level 3 for Commuicatio. The assessmet result is show i the form of a spider diagram (Figure 3). The diagram has the 6 Key Process Areas as its axis ad 5 Maturity levels o each axis. A maturity profile is formed by likig all the key process area ratigs, which idicates the overall maturity of the project team i chage maagemet. Review ad Feedback phase: Fially, the assessmet results ad fidigs will be preseted at a workshop to all project participats. This workshop provides a opportuity for everyoe to review ad commet o the assessmet fidigs. It is also a forum to review existig performace ad discuss potetial improvemet. The output of this workshop will be a implemetatio pla with clearly defied resposibilities. The CM3 framework ad its assessmet procedures are geeric. They ca be applied to ay costructio project regardless whether or ot NEC ad CCM are used. 5. Case Studies Three projects were selected as case studies durig this study. The mai objective is to follow the actual use of CCM o real projects ad to examie the beefits it brigs. These three projects are: Case study 1 is a 34millio refurbishmet project for a office block i cetral Lodo. It is carried out by a team that has ot worked together previously. Most project parters are ew to NEC cotract ad CCM system. The project is fairly stadard ad risk is low. Case study 2 is a sub-statio power plat with a budget of 6millio. The project team collaborated o other projects before. Its members have mixed levels of experiece with NEC ad CCM. Case study 3 is a 3millio civil egieerig refurbishmet project. The project team members are all experieced with NEC ad CCM. Due to the ature of the project ad its site coditio, this project has a high level of risk. At the start of each project, the researcher iterviewed the key members of the project team to idetify which areas they expect CCM would provide support for them. Durig the project, data related to the usage of CCM by the three projects are captured by the system i a log file. The usage patters were aalysed ad the aalysis results cotributed to the developmet of the calculatio method for tagible beefits of CCM. Table 6 illustrates some basic iformatio about these projects ad the results of the calculatio of tagible beefits as a result of usig CCM. 16
CCM Report Table 6 Case studies ad tagible beefit calculatio results Project descriptio CASE STUDY 1 CASE STUDY 2 CASE STUDY 3 34m buildig refurbishmet project 6m sub statio power plat project 3m civil egieerig project Project duratio 20 moths 18 moths 18 moths Number of Early Warig 78 53 105 Number of Compesatio Evet 123 79 106 Value chage before istructio 13 6 9 Value chage after istructio 110 73 97 Cosumable cost savig 1969 1294 2017 Admiistrative staff cost savig 11445 7497 11052 Maagerial staff cost savig 41954 27629 41617 Total tagible savig 55368 36420 54685 The size of the tagible beefit is directly liked to the umbers of EWs, CEs ad Value Chages of a project. The higher the umbers are, the bigger the savig will be. For these three case studies, the tagible savigs were 55368, 36420 ad 54685 respectively. The majority of the savigs comes from reductio i staff time. This is because CCM helps project teams improve the operatio of NEC processes sigificatly. The result is ofte that key staff are able to maage more projects the they could previously. I other words, the system helps with raisig the capability of costructio orgaisatios. It is particularly importat i today s climate sice it is difficult to recruit competet maagerial staff. The savig of pritig ad postig documets has both ecoomic ad sustaiable evirometal beefits. show i Figure 3. It is clear that as a result of adoptig NEC ad CCM, these projects have achieved capability maturity levels betwee 3 ad 5 i all key busiess process areas. These are well above the idustry bechmark of levels 1 ad 2, as suggested by other studies ad our ow research fidigs. The assessmet of the itagible beefits is doe at the late stage of each case study project. This was doe by partially followig the Class A assessmet method of the CM3 framework. The result is Figure 3 Case studies itagible beefits assessmet 17
6. Summary The report presets the mai fidigs of a two year research project, which set out to ivestigate the beefits of the CCM system i supportig NEC projects. The mai coclusios are summarised as follows: As more ad more costructio projects adopt IT collaboratio tools, there is a growig demad for evaluatio of the beefits of these tools. First of all, users would like to see evidece that their ivestmet i these tools is justified. Secodly, they are iterested to lear how to maximise the beefits of these tools by kowig their full potetial. Usig CCM ad NEC will ot automatically traslate ito higher capability maturity levels i relatio to cotract chage maagemet. Nevertheless they help to raise the maximum levels that ca be achieved. Without systems like these it is extremely difficult to reach maturity levels 4 ad 5 i the key process areas, such as Maagemet Process, Commuicatio, Maagemet Iformatio, etc. Bibliography The vast majority of CCM users believe that the system is deliverig real beefits, especially i improvig cotract chage maagemet process efficiecy ad compliace with NEC requiremets. Seior executives are particularly pleased with the aspect that CCM helps to reduce project risks ad improve predictability. CCM is a useful tool, i juctio with other maagemet systems, to cotrol ad moitor multiple projects. Quick closig of fial accout is also highlighted. The tagible beefits calculatio method helps a project team to make a case for adoptig a IT tool like CCM. It shows that i most cases tagible savigs aloe ca outweigh the cost of the system. The proposed CM3 framework helps to measure the itagible beefits of CCM ad quatify them usig the improvemet of capability maturity levels. Previous studies i both costructio ad other sectors have already established that higher capability maturity levels will lead to better ad more cosistet performace. 18
CCM Report Bibliography Adrese J, Baldwi A, Betts M, Carter C, Hamilto A, Stokes E ad Thorpe T (2000) A Framework for Measurig IT Iovatio Beefits, ITco Vol. 5, pg. 57-72 Broome J C (1999), The NEC Egieerig & Costructio Cotract: A User s Guide, Thomas Telford Ltd, UK. APM. (2007). Models to improve the maagemet of projects, Associatio for Project Maagemet (APM) Betts M. (1999). Strategic maagemet of IT, Blackwell Sciece, Lodo CIRIA. (1996). IT i Costructio quatifyig the beefits, Costructio Idustry Research ad Iformatio Associatio, Report 160, CIRIA, Lodo Costruct IT Cetre. (1998). Measurig the beefits of IT iovatio, Costruct IT Cetre of Excellece, Uiversity of Salford, Salford, UK. HM Treasury. (1984). Iformatio Techology i the Civil Service: Method for Evaluatig the Impact of Office Techology Systems, Lodo: HMSO. Pollalis S.N. ad Becerik B. (2006). Computer aided collaboratio i maagig costructio, Harvard Desig School, USA. SCRI. (2005). SPICE 3 - Structured process improvemet for costructio eterprises (SPICE) level III, Salford Cetre for Research ad Iovatio (SCRI), Jauary 2005 SEI. (2006). Appraisal Requiremets for CMMI, Versio 1.2 (ARC, V1.2), CMU/SEI-2006-TR-011, ESC-TR-2006-011, Caregie Mello Uiversity, Software Egieerig Istitute (SEI), August 2006 SEI. (2002). Capability Maturity Model Itegratio (CMMISM), Versio 1.1, CMU/SEI-2002-TR-011, ESC- TR-2002-011, Caregie Mello Uiversity, Software Egieerig Istitute (SEI), March 2002 Stewart R. ad Mohamed S. (2003). Evaluatig the value IT adds to the process of project iformatio maagemet i costructio, Automatio i Costructio, 12 (2003) 407-417. Li H. (1996). Towards quatitatively measurig the performace of costructio IT systems, Buildig Research ad Iformatio 24 (1) (1996) 379-382. Love P.E.D., Irai Z. ad Edward D.J. (2005). Researchig the ivestmet of iformatio techology i costructio: a examiatio of evaluatio practices, Automatio i Costructio, 14 (2005) 569-582. Marsh L. ad Flaaga R. (2000). Measurig the costs ad beefits of iformatio techology i costructio, Egieerig, Costructio ad Architecture Maagemet, (2000) 7/4, 423-435. Mitchell B. ad Trebes B. (2005), NEC: Maagig Reality: Complete Set of Five Guides, Thomas Telford Ltd, UK. NCCTP. (2006). Provig collaboratio pays: study report, Network for Costructio Collaboratio Techology Providers, UK. 19
20 Appedix A
Ackowledgemets We would like to ackowledge the KTP Programme for fudig this project ad thak Ja Striger ad Doug Irish (KTP Advisers), Clare Rowso ad Katie Gough (KTP Office at UWE) for their advice ad admiistrative support. We thak our idustrial collaborators - Des Dowey ad Robi Wilki (Maagemet Process Systems Ltd) for their cooperatio, as well as may CCM users for their participatio i iterviews ad questioaire survey. Fially, thaks to Barry G Trebes of Mott MacDoald ad Dr Jo Broome of Leadig Edge CC for providig feedback o our research fidigs.
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