Effect of Best Value Model Variables on Contractor Selection Decision

Abstract

Best-Value contracting is a mechanism that many agencies used to effectively implement projects with multiple objectives. It allows the government to acquire goods and services from the businesses that offer the Best-Value to the government, not simply the low-bid. The Low-bid contracting is false economy as the initial savings from price-based competition are erased by additional long-term costs. This paper discusses the implementation of the Best-Value concept in the procurement of construction projects. The main goal of the model implementation is studyingthe effect of changingBV model variables on the selection decision. Sensitivity analysis isconduct using scenarios of selection decisions. These scenarios are extremely important to the decision makers as it provide them with the reliability level and limitations of the model utilization. The paper provides both the decision makers and researchers with Sensitivity Charts that offer the guidelines for model implementation in real-world projects. Sensitivity Charts shows the effect of past performance data on the resulted Best-Value and the selected contractor as well.