Applying the Ahp to Support the Best-Value Contractor Selection – Lessons Learned From Two Case Studies in Taiwan

Abstract

Lately the Best-Value (BV) method for contractor selection has been receiving considerable attention in the public sector in many countries. However, the operations used in performing the BV method often differ due to the various government procurement requirements. Consequently, some of the methods popular in the academic community are not easily incorporated in the BV method in some countries. To enhance the procurement process, this study aims to gain experience by applying the well-known analytical hierarchy process (AHP) to weight the decision criteria for selecting BV contractors of two construction projects in Taiwan. Through these two case studies, this work confirms that the AHP provides a significant benefit for considering the individual preferences of all decision-makers when weighting the criteria. However, this study finds two major potential obstacles, the legal requirements associated with using the AHP and the time it takes to implement the AHP. To overcome these obstacles, this work suggests guidelines to meet the legal requirements for implementing the AHP in the BV contractor selection, and proposes several strategies to shorten the AHP implementation time. The lessons learned here are relevant to those countries in which BV method must be performed in a transparent and strictly regulated environment.

Scoring rules and abnormally low bids criteria in construction tenders: a taxonomic review

“…Considered in this way, the issue then becomes one of solving a multi-criteria decision-making problem concerning the weights of several factors (Holt et al, 1994c;Hatush and Skitmore, 1998;Pongpeng and Liston, 2003;Wang et al, 2013). Furthermore, Jennings and Holt (1998) define multicriteria decision-making as a 'selection based on evaluation of tender submissions against criteria predetermined by auctioneers and considered important by them in terms of achieving successful project completion'.…”

“…Furthermore, Jennings and Holt (1998) define multicriteria decision-making as a 'selection based on evaluation of tender submissions against criteria predetermined by auctioneers and considered important by them in terms of achieving successful project completion'. Additional techniques have been applied by other researchers, including multi-attribute analysis (Holt et al, 1994b(Holt et al, , 1994c, the analytic hierarchy process (Pastor-Ferrando et al, 2010;Wang et al, 2013), fuzzy sets (Nieto-Morote and Ruz-Vila, 2012), case-based reasoning models (Dikmen et al, 2007), neural networks (Art Chaovalitwongse et al, 2012), and data envelopment analysis (Falagario et al, 2012).…”

“…This involves also taking non-price or technical/ quality factors into consideration in obtaining an optimum outcome for the contracting authority, the owner or the auctioneer (Wang et al, 2013), i.e. the best value for money (Holt et al, 1995).…”

Subjectively and Objectively Integrated Assessment of the Quality Indices of the Suburban Residential Environment

“…Many methods have been developed for the determination of the weights of indices when their significance is ranked by experts (Saaty 1980(Saaty , 2005Hwang, yoon 1981;ustinovichius et al 2007;Podvezko 2009;gudienė et al 2014;Fouladgar et al 2012;Zavadskas et al 2014;Aghdaie et al 2013;Podvezko, Sivilevičius 2013;Šiožinytė, antuchevičienė 2013;Wang et al 2013;Zolfani, Šaparauskas 2013). The general idea of ranking is that the most significant criterion is attributed the highest weight, and the calculated weights are usually normalised, i.e.…”

Fuzzy Multi-Criteria Decision Making Model for Subcontractor Selection in International Construction Projects

“…Although numerous researches on the prequalification process of main contractors have been carried out to date (Nguyen 1985;Juang et al 1987;Paek et al 1992;Elton et al 1994;Singh, Tiong 2005;Brauers et al 2008;Mitkus, Trinkuniene 2008;Turskis 2008;Zavadskas et al 2008Zavadskas et al , 2009Zavadskas et al , 2010Plebankiewicz 2009Plebankiewicz , 2010Podvezko et al 2010;Arslan 2012;Cheng, Kang 2012;San Cristobal 2012;Vahdani et al 2013;Wang et al 2013), only a number of scientific papers discussing the problem of construction subcontractor prequalification have been published. Ng and Luu (2008) developed a case-based system for construction subcontractor registration.…”