A Study On Performance Evaluation For Engineering-Procurement-Construction Projects Based On Quality Function Deployment Method

As a mode of large general contracting project, engineering–procurement–construction has worldwide application now. In this mode the general contractor should be responsible for the whole process such as engineering, procurement, construction and the successful operation of a project in accordance with the contract. The performance management often plays the binding and leading role in the success of such large and complex projects. The design and assignment of performance evaluation indicators could decide whether performance management is effective or not.The existing methods of performance evaluation for engineering projects are almost based on methods of performance evaluation for general business and they mainly use financial profit targets to evaluate performance of projects. Engineering- procurement-construction projects and general business have different characteristics. Otherwise financial profit targets can't accurately reflect the performance of projects. So it is meaningful to study on designing and assignment of multi-dimentional performance indicators according to characteristics of engineering–procurement -construction projects. Quality function deployment is an analytic tool to convert and quantify the relationship among various evaluation indicators. The representative characteristic of Quality function deployment is the idea that the developing process of product and service are all object-oriented. According to the idea, this paper applied quality function deployment method to the study on the designing and assignment of performance evaluation indicators for engineering-procurement- construction projects. The study included three main work:1. Design of key performance indicators for engineering-procurement- construction projects.This paper summarized the duties and characteristics of engineering, procurement and construction which are the main stages of Engineering-Procurement- Construction mode based on literature reading and practice in engineering enterprise. After summarizing, this paper gave the key result areas belonging to each stage. The key performance indicators were designed according to the key result areas2. Design of houses of qualityThis paper used quality function deployment method to construct two-stage houses of quality which were used to choose and qualify the performance indicators. The first-class house of quality took inside and outside demand as the initial driving force to choose performance indicators. Based on the grades which were decided by experts, the importance of demand characteristics were amended by comparative matrix in first-class house of quality. The demand characteristics and their importance rates got further conversion in second-class house of quality. The performance indicators which satisfied demand characteristics were picked out. Then the chosen indicators were amended and converted by correlation matrix in second-class house of quality. At last the usable key performance indicators and their weights were got.3. Case studyThis paper used a case to interpret the new method and discussed some important issues in practice such as organizing way of quality function deployment team and information change of house of quality.This paper could help project managers pay more attention to important areas which actually affect project performance and optimize using of resource. Meanwhile the new method considers lots of factors such as customers'demand, developing targets of enterprise, competition and correlation between indicators when the performance indicators are evaluated. This approach makes performance evaluation of engineering-procurement-construction projects more reasonable. The effectiveness of engineering enterprises could be improved by using this new method. It is also meaningful to enhance the enthusiasm of staff.