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Decision making to support an integrated infrastructure supply chain industrial ecological approach within public private partnerships
conference contributionposted on 2009-01-01, 00:00 authored by Kerry London, Xiaohua Jin
Supply chains are complex adaptive systems for which final performance depends upon numerous interdependent decisions made by numerous firms which synthesise inputs from various resources systems. The dynamic interdependent behaviour of social, economic, material and informational resource systems within eco-industrial settings that support the built environment life cycle supply chains can be studied at the supply chain level. The impact of megaprojects is significant and holds promise to explore the impact of decisions on various systems as it combines project and system boundaries. Megaoprojects considered as major events within systems can produce critical revolutionary impacts on the systems within which they are embedded. The decisions that are made on megaprojects are central to risk management. typically major infrastructure projects are procured through a form of public private partnership (PPP). The core principle of PPP is value for money which refers to the best available outcome attempting to take account of all benefits, costs and risks over the whole life of the procurement. In this paper the focus is on Australia where there has been considerable acitivity in the use of PPPs. With recent national infrastucture packages proposed to stimulate the economy due to the global financial crisis, decision modelling on risks is a revelant and critical matter not only in practice but also in the research community. PPPs encourage the whole-of-lifecycle approach in the procurement and management of public sector assets by transparently recognising the costs and risks associated with the whole life of the required service or facility, thus integrated whole of life supply chains can be considered. By creating a single point of responsibility for an entire project from inception through operation, a strong incentive is created for thinking about the effects that a design or construction decision will have on the effectiveness and efficiency of managing and maintaining a facility during its operational life. The decision to procure holistic supply chains becomes a much more viable commercial reality in the PPP environment than previously considered in the usual commercial construction spot transactional approach. These types of decisions tend to be imprecise, approximate and complex requireing justification and reasoning logic rather than the classical 'truth' logic. The purpose of this paper is to develop a theoretical decision framework which combines interdependency and multi-values logic for supply chain procurement modelling.