Determine work distribution for the ITS project when selecting an appropriate procurement package.
Experience from a review of ITS contracting methods and practices. Step 2 of the Decision Model.
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United States

Guide to Contracting ITS Projects


Experience has shown that the ITS procurement method can have a significant impact on the ultimate success of the ITS installation. Currently, the success rate for intelligent transportation systems life cycle is very low. Some of the key issues that have been identified with the procurement process include incorrect contracting approach, inexperience of the agency, failure to follow appropriate procedures, and inadequate commitment of project management and systems engineering resources.

The National Cooperative Highway Research Program (NCHRP) funded this research with the objective of developing a guide to contracting ITS projects and services that would assist government officials, traffic engineers, system integrators, and others involved in the specification development and purchasing of ITS installations. The approach for this study included an extensive literature review as well as a survey of state and local Departments of Transportation to learn about their current practices and experiences with ITS contracting. As a result, a report of findings, "Considerations for a Guide to Contracting ITS Projects" and "Guide to Contracting ITS Projects" were published. This guide presents an eight-step Decision Model that guides agencies through the procurement process and enables them to select the most appropriate procurement package for their project. To obtain a complete understanding of the Decision Model, readers should consider the full set of lessons learned (as each lesson learned is based on a separate step of the decision model).

Lessons Learned

Following the initial decision to proceed with the Decision Model, the agency must determine whether the work will be distributed through a single contract or through multiple contracts. The following observations are made with regard to the second step of the Decision Model:

  • Utilize a single contract, if possible. Multiple contracts necessitate increased project management resources. However, as noted below, there may be reasons to consider multiple contracts.
  • Utilize multiple contracts if there is significant software and systems development, in addition to field construction. This research concluded that a key factor in the success of a project is the ability of the agency’s project engineer to interact directly with the contractor whose work represents the highest risk to the project’s success (software development). This may require the use of multiple contracts. For example, if the largest dollar amount of an ITS project is in field construction, but the project also requires a significant amount of software and systems development, then multiple contracts are advised so that the systems developer can be assigned as the prime contractor.
  • Distribute work to multiple contracts if the likelihood of selecting a satisfactory prime contractor for the overall project is uncertain.
  • Utilize multiple contracts if "politics" requires that the work be spread around. This may be particularly true if the project involves significant field construction.
  • Utilize multiple contracts if the project requires significant outside expertise. A complex project may require the assistance of supporting contractors who have specific expertise.

The agency should apply the Decision Model process separately for each contract, so that a procurement package that best addresses the nature of the work to be performed can be selected. For example, if there is one contract for software development and a separate contract for field construction, the Decision Model should be applied separately to each of those contracts.

Careful consideration of the work distribution is an important step performed early in the decision model process and contributes to the agencies' selection of an appropriate procurement package. By adhering to this step and subsequent steps in the model, agencies can experience cost as well as time-savings in the procurement of ITS. Moreover, an efficient procurement process can significantly influence the ultimate success of the ITS deployment.

Guide to Contracting ITS Projects

Guide to Contracting ITS Projects
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Kenneth R. Marshall and Philip J. Tarnoff
National Cooperative Highway Research Board

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