Development of a risk-based strategy implementation of a full pre-financed contractor scheme (CPF) in toll road projects to improve time performance

Abstract

Several reasons underlie the use of Contractor Full Pre-Financed (CPF), which provides a much higher return opportunity than a standard payment contract system or the Monthly Certificate (MC). The case study in this research is one of the toll road construction projects in Indonesia that uses the CPF scheme. This study uses qualitative risk analysis to determine the dominant risk, quantitative risk analysis using the PERT distribution method to measure the impact of adding days due to the dominant risk on the critical path and produce a strategy to reduce the added days value due to risks in toll road projects with the CPF scheme. Strategy development is carried out to reduce the value of inherent risk to become a residual risk. The potential value of additional project completion time due to dominant risk is 30.68%–38.33% of the initial duration of the project. Through the development of strategies for each critical path activity, the potential added value of project completion time due to dominant risk can be reduced to 11.45%–16.73% of the initial project duration.

Keywords:

• Contractor Full Pre-Financed (CPF)
• toll road projects
• time performance
• qualitative risk analysis
• quantitative risk analysis
• PERT analysis

Reviewing Editor:

• Sanjay Kumar Shukla, Edith Cowan University, Australia

SUBJECTS:

• Civil, environmental and geotechnical engineering
• transportation engineering
• business, management and accounting
• risk management

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Mohammad Ichsan

Dr. Mohammad Ichsan is an Assistant Professor in the Binus Business School of Bina Nusantara University. He has pursued his Diplom Ingenieur in Electrical Engineering from the Hochschule Darmstadt, Germany prior to obtain his Master’s in Project Management from the University of Indonesia. He has continued his study and received his Doctoral in Strategic Management. His teaching area is project management and operations management, meanwhile his research domain is project portfolio management, project management office practices and project risk management.

Wisnu Isvara

Dr. Wisnu Isvara is an Assistant Professor in the Civil Engineering Department Faculty of Engineering Universitas Indonesia. He has been lecturing in subjects of project management, construction management, cost management, procurement management and engineering system. He completed his Bachelor’s degree in Civil Engineering from Universitas Indonesia. He has continued his study and received his master’s degree and completed his doctorate degree majoring in Construction Management from Universitas Indonesia. Dr Wisnu Isvara also served as General Manager of Institute of Technology Faculty of Engineering Universitas Indonesia since 2007 until now.

Jodi Noor Handibyanto

Jodi Noor Handibyanto is a civil servant at the Ministry of Public Works and Housing, Republic of Indonesia. He holds a Bachelor’s degree in Civil Engineering from University of Indonesia and Master of Engineering in Project Management from University of Indonesia. Some of his research objects include research on buton rock asphalt mixtures and project management in toll road projects.

Farras Ammar Muhammad

Farras Ammar Muhammad is a graduate in the field of civil engineering and project management where in his undergraduate program he took research in buton rock asphalt mixtures and in his master’s program he took research in project risk management, both from the University of Indonesia. Currently working as an operational supervisor in the oil and gas industry and has interests in project management & operations management.