Traditional design-bid-build guidelines suggest that engineering estimates should be within +/-10% of the lowest contractor bid and recommend this value as a reference to identify anomalies in the bidding process. This guidance, however, neglects delivery approaches such as design-build.This research examines 305 design-build highway projects procured using best-value and identifies the underlying reasons for bid dispersion and cost estimates inaccuracies. This study found an average bid dispersion of 27%, suggesting that a larger threshold (i.e., 25%) is needed to account for the inherent variability of design-build projects. This study also found that engineering estimates are on average 2% more than the awarded price. This result contradicts findings in existing literature and suggests that current practice in design-build best-value may be more conservative than other procurement methods. The study explores four potential reasons for bid dispersion and engineering estimate inaccuracies and suggests strategies for improvement.
Design-Build (DB) is an alternative project delivery system that has shown to be better in controlling cost growth than the traditional Design-Bid-Build (DBB) system. However, some road administrations are not legally allowed to implement DB and keep using DBB with consequent disadvantages, such as having high-cost overruns. There is a need, therefore, to provide road administrators delivering DBB projects with research-based mitigation measures that can help them to minimize the main reason for cost overruns. To this end, this study identifies the main reasons for cost overruns in the design, the procurement and the construction phases of DBB road projects and point out to the specific elements of DB project delivery that might help to minimize these reasons. To identify the reasons, an exploratory content analysis was performed on interviews conducted with 41 professionals involved in road project management in Chile. Literature review and document analysis of DB were used to analyze the identified reasons under the framework of the DB practice in the United States. The results showed that four elements based on the DB approach might be used to minimize cost overruns in DBB projects: (1) in the design phase, road administrators should consider the early integration of the constructor's expertise. In the procurement phase, they should establish (2) instances for effective information exchange and (3) a goal-oriented selection process. Overall, road administrators should consider (4) establishing a one-point of high-level accountability for the design, the procurement, and the construction phases. This study will serve DBB road administrators to start the transition from DBB to more collaborative approaches that will help to minimizer cost overruns and, therefore, to improve the project cost performance.
For cost-efficiency, public safety, and sustainability, improving long-term performance in highway projects is imperative for public administrations. Project delivery and procurement methods provide an opportunity to align design and construction processes with this goal. While previous studies have explored whether project delivery methods impact the long-term performance of highway projects, these studies did not focus on how core elements within project procurement relate to long-term performance. Thus, to fill this gap, this research explores how and to what extent long-term evaluation criteria are considered in design-build best-value procurement of highway projects. To this end, the team conducted content analysis on 100 projects procured between 2009 and 2019 by 19 DOTs across the U.S. The analysis of 365 evaluation criteria found that (1) roughly 11% of them related to long-term performance. (2) The weight given to these criteria in the overall technical proposal was lower than 30%. (3) Sixty-five percent (65%) of long-term evaluation criteria focused on design while 15% related to materials and technology, respectively. The results of this study are a stepping stone to initiate a deep exploration of the relationship between procurement practices and actual project performance. Currently, as sustainability and life cycle assessments remain top concerns in infrastructure projects, this line of research may benefit DOTs and highway agencies across the U.S. and worldwide.
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