A special Partial Least Squares (PLS) path decision modeling for bid evaluation of large construction projects

Abstract

Large construction projects involve massive capital investments, lengthy execution period, and enormous management uncertainties. Therefore, the task of selecting a capable contractor for smooth project delivery is challenging. Although previous studies have attempted to improve the methods of bidding evaluation, limitations still exist. First, the evaluation results might be biased due to the heterogeneity in a small group of experts with different professional experience and capabilities. Second, multi-correlation can reduce the validity of the weightings of the indexes and evaluation results. Third, the subjectivity of the weightings can be a crucial hurdle to the selection of a suitable contractor for a specific project. To overcome these shortcomings, this study introduces Partial Least Squares (PLS) path modeling and develops a Sequence-Multi-Criteria System which can aggregate the evaluation results from different professional practitioners without the use of pre-defined weighting schemes, thus providing a reliable reference for bid evaluation. We incorporated this approach into an evaluation procedure stipulated in the procurement documents of the World Bank and specifically aimed at selecting suitable contractors for large construction projects. A case study was conducted via comparisons across various scenarios, and the validity of this approach was subsequently proved.