Empirical Framework for Making the Bid/No-Bid Decision

Abstract

AbstractDeciding whether or not to bid on a particular project is regarded as one of the major challenges faced by construction contractors. This decision-making problem involves the consideration of several factors. These factors are related to project, client, consultant, competitors, and market. Although several researchers have targeted the subject of bidding in construction, few of them have tackled the bid/no-bid problem in particular. The purpose of this paper is to propose an empirical framework for making the bid/no-bid decision. The proposed framework consists of two consecutive components. Component 1 determines key bidding factors that are considered by contractors when evaluating bids. Senior managers at top contracting organizations were interviewed to identify factors that affect the bid/no-bid decision. Component 2 utilizes data envelopment analysis (DEA) to make the bid/no-bid decision. The strengths of utilizing DEA include its input-output framework, which facilitates incorporating many...