Highway Procurement : Performance-based Contractor Selection

Highway Procurement : Performance-based Contractor

Selection

Citation for published version (APA):

Favie, R., & Maas, G. J. (2008). Highway Procurement : Performance-based Contractor Selection. In J. Walraven, & Y. Sutjiadi (Eds.), PhD Projects Book 2008 (pp. 34-35). 3TU Research School Integral Design of Structures.

Document status and date: Published: 01/01/2008 Document Version:

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Highway Procurement

Performance-based

Contractor Selection

ir. R. Favié / r.favie@bwk.tue.nl / 040 247 2583 prof. ir. G.J. Maas / g.j.maas@bwk.tue.nl Performance Engineering for Built Environments Eindhoven University of Technology/ Faculty of Architecture, Building and Planning Contractor selection is one of the

steps of the procurement function (see below on this poster). A lot of different procedures, criteria and awarding techniques can be used and combined. But which one is the best? In other words: which way of selecting a contractor leads to high performing projects?

The goal of this research is to

determine the contractor characteristics that affect the project performance.

The Expected Result of this research

is a list of contractor characteristics that affect the project performance. This list can in the future be used for contractor selection. 6. Determining Specifications 7. Selecting Supplier 8. Contracting 9. Project execution and transfer 10. Managing relationship 11. Contract termination

Initial / Tactical Operational

Client Suppli er 2. Com m odity stra tegy 1. Insour c ing / Outs ourc in g 4. Suppli er de velop m en t and qu al it y m anagem ent 3 . D e te rm in e le v e l o f supp lier integr ation 5. Strat egic co st m anagem ent Strategic

1. Are we going to outsource tasks or not? 2. Work packaging

3. Functional grouping and form of contract 4. How can we assure the quality of the work? 5. Payment modalities

Example:

2. Connection between A and B 3. Design and Build contract in the UAV-gc 4. Systeemgerichte Contractbeheersing 5. Payment is based on the contractor’s

performance (Systeemgerichte contractbeheersing) What do we need? (based on 2) Example: Highway of 20 km with 4 structural works, functionally specified

1. Can we learn something for future selection? 2. Did we use the right selection methodology?

How will we select the best possible supplier? Example: Tendering procedure a) Prequalification: financial stability, quality system, references b) Awarding: Price 60%, quality 40% b) decision techn. A Expected result: best performance for the best price!

Which agreements will be made?

Example:

Final agreement on the work that has to be done (what and how)

Supplier starts his work Example: Contractor starts fulfilling his contractual agreements Continuous performance assessments (based on 4)) Example: through auditing: a) purchasing management b) technical management c) environmental management d) project management e) quality management f) safety management Result: did we really select a good contractor? Project completion Example: Completion of the highway 34

Performance-based contractor selection for Design-Build

highway projects

ir. R. Favié1_{, prof. ir. G.J. Maas}2

1_{Phd Researcher, r.favie@bwk.tue.nl} 2_Supervisor

Performance Engineering for Built Environments

Eindhoven University of Technology - Faculty of Architecture, Building and Planning, The Netherlands

Subject

The performance of a project in terms of cost, time, quality and client satisfaction is discussed a lot in literature. The main factors affecting the performance are project characteristics, client characteristics and contractor characteristics. Ling (2004) found that contractor characteristics play a big part in the performance of a Residential and Non-residential construction project.

Contractor selection is part of the total procurement process of a construction project. After determin-ing the specifications, the client will start to look for the contractor that can offer the best value. This selection process can be done in several ways, according to European regulations. Also, different cri-teria can be set, as long as they comply with the basic principles: equality, transparency and propor-tionality.

Design and Build (D&B) contracts are part of the integrated contract forms. This means that a con-tractor in a D&B contract is not only responsible for the construction work, but also for the design of the construction.

Goals

Ling’s (2004) conclusions were for the construction of buildings. The construction of a highway pro-jects differs from that. Still, the contractor characteristics seem to play a big part in the project per-formance. The main goal of this research is to gain insight in the key contractor characteristics deter-mining the performance of contractors in Dutch highway projects.

Strategy

The data that will be used in this research will come from project databases. From this data constructs will be formed that can give information about the link between the performance of the project and the contractor characteristics determining this performance

Expected Results

A list will be made with contractor characteristics affecting the project performance. This list can be used for selecting contractors for future projects.

Preferred Partners Applications / Sponsors

Rijkswaterstaat (Ministry of Transportation, The Netherlands) and DHV.

Prime Publication / Prototyping

− Favie, R., Abdalla, G. and Maas, G.J., (2007), The best criteria for the selection of contractors in the Dutch construction industry! In: Hughes, W. (Ed.) Proceedings of the CME25: Construction Management and Eco-nomics: Past, Present and Future, Reading, UK

− Favie, R. and Maas, G. J. (2008), Ranking Construction Project Characteristics. In: CIB Joint International Symposium 2008, Transformation Through Construction, Dubai, UAE

− Vrieling, L., Favie, R., Kranendonk, P. and Maas, G. J. (2008), Partner Selection Criteria for Paricipation-based Cooperation. In: CIB Joint International Symposium 2008, Transformation Through Construction,

Dubai, UAE

Research Period

2005 - 2010

PhD Projects Book 2008

35 Research School Integral Design of Structures