An Innovative Uncertainty Management Framework to Support Contracting for Product-Service Availability. Issue 5 (29th August 2014)

• Record Type: Journal Article
• Authors: Erkoyuncu, John A; Roy, Rajkumar; Shehab, Essam; Kutsch, Elmar
• Editors: Kandampully, Jay; Duddy, Ria
• Is Part Of: Journal of service management. Volume 25:Issue 5(2014)
• Publication Date: 2014-08-29
• Subjects: Service industries -- Management -- Periodicals; 658.005
• DOI: 10.1108/JOSM-07-2013-0193
• Languages: English
• ISSNs: 1757-5818

Abstract

Abstract : Purpose: In the light of challenges experienced in cost estimation at the bidding stage of complex engineering services in the defence industry (e.g. contracting for availability), this paper presents a framework to manage the influence of uncertainty on cost estimates. Design/methodology/approach: The research applied the soft-systems methodology and benefitted from interaction with four major organisations in the defence industry through document sharing, semi-structured interviews, workshops and case studies. Findings: The framework is composed of seven stages to plan, identify, prioritise, classify and manage cost uncertainties. Through the validation of three case studies some of the key benefits of the framework were realised in project planning, uncertainty visualisation, and capability management. Research limitations/implications: The research has been applied in the defence sector in the UK and focuses on the bidding stage. Further research needs to be applied to confirm that the findings are applicable across industries and across the life cycle. Originality/value: The paper builds on the theory behind risk and uncertainty management and proposes an innovative framework that avoids the assumption of 'perfect' knowledge by raising questions about the validity of the input data.