Client-contractor bargaining on net present value in project scheduling with limited resources

Abstract

The client-contractor bargaining problem addressed here is in the context of a multi-mode resource constrained project scheduling problem with discounted cash flows, which is formulated as a progress payments model. In this model, the contractor receives payments from the client at predetermined regular time intervals. The last payment is paid at the first predetermined payment point right after project completion. The second payment model considered in this paper is the one with payments at activity completions. The project is represented on an Activity-on-Node (AON) project network. Activity durations are assumed to be deterministic. The project duration is bounded from above by a deadline imposed by the client, which constitutes a hard constraint. The bargaining objective is to maximize the bargaining objective function comprised of the objectives of both the client and the contractor. The bargaining objective function is expected to reflect the two-party nature of the problem environment and seeks a compromise between the client and the contractor. The bargaining power concept is introduced into the problem by the bargaining power weights used in the bargaining objective function. Simulated annealing algorithm and genetic algorithm approaches are proposed as solution procedures. The proposed solution methods are tested with respect to solution quality and solution times. Sensitivity analyses are conducted among different parameters used in the model, namely the profit margin, the discount rate, and the bargaining power weights.

Available Versions of this Item

• Client-contractor bargaining on net present value in project scheduling with limited resources. (deposited 24 Oct 2007 01:01)
  • Client-contractor bargaining on net present value in project scheduling with limited resources. (deposited 07 Nov 2008 16:17) [Currently Displayed]
    • Client-contractor bargaining on net present value in project scheduling with limited resources. (deposited 14 Jul 2009 09:57)