Research Of Risk Sharing Compensation Model In Integrated Project Delivery

In IPD project, the main participants share risk and reward is an important principle, which can ensure the implementation of IPD mode. This study aims at proposing a specific risk sharing compensation model to reveal and optimize the important principle. Through using of Building Information Model and integrating key participants in early stage of project, the compensation model can be determined by designing a cooperative and non-controversial contract. Considering it is hard to measure the risk borne of key participants, this study measure risk from the point of risk perception. To overcome information loss and bounded rationality of the participants, 2-tuple linguistic representation has been put forward to evaluate perceived risk level of participants in each strategies. Meanwhile, language terms can be quantized based on membership degree. Since risk perception level can affect expected utility of each participant, this study proposed value function and weight function based on Prospect Theory and mental utility can be obtained through the product of them. The research problem of this study is an n-person bargaining problem, in which each participant cooperates through bargaining, cooperative bargaining can be used to solve the contradiction between personal utility and team utility. Once the utility of each participant has been obtained, Nash Bargaining Solution can be used to calculate overall utility of IPD key participants in order to choose the optimal strategy as the last risk and reward allocation strategy. Since IPD hasn’t been generalized in China, a simulation case has been introduced to simulate the operation of proposed risk sharing compensation. As a result, mental utility of each participant can be obtained through the model in early stage of a project. Choosing strategy that optimizes overall utility so as to integrated each key participant in the beginning and improve benefit of the project.