Organizational Implementation of Best Value Project Delivery: Impact of Value-Based Procurement, Preplanning, and Risk Management

Abstract

Many buyer organizations have attempted to implement new project delivery methods to increase performance on their contracting processes. Yet implementing new business practices can be difficult to accomplish successfully. An action research methodology was utilized to present a longitudinal case study of the University of Alberta’s implementation of the Best Value Business Model (BVBM). A key research objective was to document and present observations of the change management principles utilized during the implementation of organizational change at a large public organization. Other research objectives included quantification of project-level and organizational-level success indicators that reflect the progress of change implementation. Results are analyzed after more than two years of implementation of the BVBM on ten separate contracts. Direct cost savings on these projects as a result of the BVBM has been documented to be as much as $16 million when considering savings below budget and conducting comparisons against traditional project delivery methodologies. Other success factors include low rates of vendor and contractor change orders and high satisfaction among owner project managers with regards to the performance of contracted service providers. Contributions of this research include documentation how theoretical change management principles have been applied within an action research setting as well as the identification and documentation of success indicators for project- and organizational-level implementation of new project delivery methods.