Contractor selection using the multiattribute utility theory

Literature and past research suggests that one of the reasons for the poor performance ofthe construction industry is due to the inappropriateness of the awarded contractor. Inorder to ensure a successful completion of a project, a comprehensive and carefulassessment of contractors data in a prequalification stage is required. Appointing anappropriate contractor to carry out the construction work, therefore, becomes one of themost important tasks to ensure the success of a project.In this thesis the author has made a preliminary survey to investigate the bidding processcurrently used in the construction industry through literature survey, extensive interviewswith the construction professionals and an industry wide questionnaire. The investigationhas focused on the procedures of prequalification and bids evaluation, it also covers thelist of criteria considered for selecting contractors in prequalification and bid evaluationstages.The thesis investigated the perceived relationship between contractor selection criteria(CSC) currently in use and predominant project success factors (PSF) in terms of time,cost and quality involving a sample of experienced construction professionals. This research is based on the premise that selection should concentrate on determiningcontractor potential for achieving project goals in terms of time, cost and quality. Thestudy presented a quantitative technique to combine the contractor data in terms of thesegoals. The study also presented an evaluation strategy that involves the consideration bothof the client goals as ends and contractor data as the means, the strategy based on thernultiattribute utility theory for the frnal selection or rank ordering of the contractors. Theselection is ultimately based on the preferences and the attitude of the decision makertoward risk.A real case study was used to validate the proposed methodology for contractorprequalification.The benefit of this work is that it provides a means using the PERT methodology toincorporate uncertainty andlor imprecision associated with the assessment of contractorsdata, this all in terms of the ultimate project success factors of time, cost, and quality.The utility technique proposed should help clients in selecting contractors and thecontractors themselves for selecting sub-contractors in offering a means of broadeningtheir analysis of tenderers beyond that of simply relying on tender values. It also alertscontractors to the importance of increasing their ability to satisfy the needs of the clients interms of their ultimate project goals

What motivates employers to establish preventive arrangements? An examination of the case of supply chains

This paper examines existing evidence as to the factors that prompt organisations to utilise supply chains to influence how health and safety is managed within them, with a view to shedding light on how far it serves to confirm or challenge the view that in general employers are unlikely to voluntarily pursue preventive management initiatives in the absence of external regulatory pressures. The analysis reveals a range of initiatives undertaken to utilise supply chains to support improvements in health and safety management, both at the level of individual organisations and via trade and industry bodies. It also, however, indicates that while supply chains can be used to improve how health and safety is managed within them, only in relatively narrowly defined circumstances will market-based business motivations alone serve to encourage the utilisation of this potential. It is further concluded that if policy-makers wish to see supply chains used more widely to improve standards of health and safety standards, then they need to do more than merely encourage voluntary action in this regard

A review of application of multi-criteria decision making methods in construction

Construction is an area of study wherein making decisions adequately can mean the difference between success and failure. Moreover, most of the activities belonging to this sector involve taking into account a large number of conflicting aspects, which hinders their management as a whole. Multi-criteria decision making analysis arose to model complex problems like these. This paper reviews the application of 22 different methods belonging to this discipline in various areas of the construction industry clustered in 11 categories. The most significant methods are briefly discussed, pointing out their principal strengths and limitations. Furthermore, the data gathered while performing the paper are statistically analysed to identify different trends concerning the use of these techniques. The review shows their usefulness in characterizing very different decision making environments, highlighting the reliability acquired by the most pragmatic and widespread methods and the emergent tendency to use some of them in combination

Contractor Selection Using Multicriteria Utility Theory: An Additive Model

A systematic multicriteria decision analysis technique is described for contractor selection and bid evaluation based on utility theory and which permits different types of contractor capabilities to be evaluated. A UK case study is used to illustrate the technique. The theoretical basis and the advantages of the technique are also presented

Criteria for Contractor Selection

This paper is concerned with identifying universal criteria for prequalification and bid evaluation, and the means by which different emphases can be accommodated to suit the requirements of clients and projects. The information, assessment and evaluation strategies currently used by procurers for screening contractors are considered, and the results are reported of an extensive literature review and a Delphic interview study with a small select sample of construction professionals with extensive experience in prequalification and bid evaluation processes. The findings indicate that the most common criteria considered by procurers during the prequalification and bid process are those pertaining to financial soundness, technical ability, management capability, and the health and safety performance of contractors

Evaluating contractor prequalification data: selection criteria and project success factors

A Delphic study investigating the perceived relationship between 20 contractor selection criteria (CSC) currently in use and project success factors (PSFs) in terms of time, cost and quality is described involving a sample of eight experienced construction personnel, including two validators. A consensus of the likely impact of each criterion on time, cost and quality is established in terms of pessimistic, average and optimistic values, which are then converted into expected means and variances via the PERT approach. The ten most and ten least important CSCs are identified and examined for differences and similarities between PSFs. The results show that past failures, financial status, financial stability, credit ratings, experience, ability, management personnel and management knowledge are perceived to be the dominant CSCs affecting all three PSFs, with safety criteria (safety, experience modification rate, OSHA incidence rate, management safety accountability) and the length of time in business being perceived to have the least effect overall. Some CSCs, such as past performance, bank arrangements, project management organization, plant and equipment were perceived to affect only one or two PSFs.Prequalification, selection criteria, project success factors, Delphic study,

Assessment and evaluation of contractor data against client goals using PERT approach

A methodology for assessing and evaluating contractor data for the purpose of prequalification and bid evaluation is presented. The PERT approach is used to develop a linear model for the assessment of contractor data. The model incorporates a multiple ratings permitting the uncertainty in contractor data to be evaluated. An empirical study investigating the importance of different contractor criteria is described. A lexicographical ordering with aspiration levels and risk analysis with sensitivity methods are used to evaluate and select or rank-order contractors against the main client goals of time, cost, and quality. A literature review is reported regarding client goals and current evaluation strategies. The assumptions, advantages and disadvantages of this work as well as an example are also presented.Prequalification, Bid Evaluation, Pert, Criteria, Client Goals, Contractor, Data,

Measuring Managerial Capability of Subcontractors Using a KPI Model

In construction projects, the large portions of construction activities are carried out by subcontractor companies; hence the success of a project directly depends on the performance of the selected subcontractors. However, general contractors generally select their subcontractors on the basis of the low bid price, which may lead to work with unqualified subcontractors. This situation usually results in additional costs. Therefore, general contractors should thoroughly measure and evaluate the performances of subcontractor candidates during the selection process. In this study, a practical and systematic performance measurement framework, which is based on the key performance indicators (KPIs) model, is developed to measure the managerial capability of subcontractors. For this purpose, first, the relevant literature was reviewed, and 94 KPIs were identified to measure the managerial capability of subcontractor candidates. Then, these 94 KPIs were categorized into three main groups namely: (1) KPIs Affecting General Performance, (2) KPIs Affecting Experience and Past Relations, and (3) KPIs Affecting Communication Skills. After identifying and categorizing the KPIs, 58 indicators were eliminated considering the characteristics of the Turkish construction industry. In the next stage, a questionnaire survey was designed and delivered to large-scale 40 Turkish contractors, who predominantly do business in international markets. The reliability and ranking analyses were performed on the collected data to determine the importance levels of the identified KPIs. The findings of this study were used to develop the managerial capability performance measurement framework