Abstract

Contingency estimating and management are critical and necessary functions for successful delivery of construction projects. Considering such importance, academics and industry professionals proposed a wide range of methods for risk quantification and accordingly for contingency estimating. Considerably less work was directed to contingency management including its depletion to mitigate risk over project durations. Generally, there are two types of risks; 1) known risks which can be identified, evaluated, planned and budgeted for and 2) unknown risks which may occurred. These two categories of risks required a cost and time contingency, even if they weren’t planned for, in order to mitigate their impact in an orderly manner. In this respect, the importance of contingency management become critical in view of increasing project complexity and difficulty of estimating and/or allocating sufficient contingencies to mitigate risks encountered during project execution. This thesis focuses on the contingency management from two perspectives; estimating and depletion of contingency over project durations. A new method is developed using fuzzy sets theory, along with a set of measures, indices, and ratios to model the uncertainty inherent in this process and estimate cost contingencies. The uncertainties are expressed in the developed model using a set of measures and indicators including possibility measure, agreement index, fussiness measure, ambiguity measure, quality fuzzy number index, fuzziness expected value ratio, and ambiguity expected value ratio. These measures, indices, and ratios provide not only the possibility of having adequate contingency but also address issues of precision and vagueness associated with the uncertainty involved in a generic computational platform. The thesis, also, presents a comparison between fuzzy existing methods, Monte Carlo Simulation, PERT, and a proposed direct fuzzy set-based method. As to depletion, the thesis presents a management procedure focusing on depletion of the contingency. The developed procedure makes use of policies and procedures followed by leading construction organizations and owners of major constructed facilities. The developed method and its computational platform were coded using VB.net Programming. Two project examples drawn from the literature are analysed to demonstrate the use of developed method and to illustrate its capabilities beyond those of traditional Methods.