Bid Evaluation Research Articles

A Multi-attribute Reverse Auction Framework Under Uncertainty to the Procurement of Relief Items

One of the main activities of humanitarian logistics is to provide relief items for survivors in case of a disaster. To facilitate the procurement operation, this paper proposes a bidding framework for supplier selection and optimal allocation of relief items. The proposed auction process is divided into the announcement construction, bid construction and bid evaluation phases. In the announcement phase, the bidder (purchaser or relief organization) invites certain suppliers to the auction. Next, the construction phase is formulated as a bi-objective fuzzy model from the perspective of suppliers. This phase provides the bidder with several suggestions, each of which containing the amount, price, and lead time of the delivery of relief items. Then, in the evaluation phase, the bidder determines the winners and optimally assigns orders by a multi-objective fuzzy model. Each of the fuzzy mathematical models in the paper is formulated under the uncertainty of parameters and is then solved by a two-stage fuzzy approach. Finally, to illustrate the validity and applicability of the proposed model, a numerical example is provided and its result is analyzed.

Sustainable Winner Determination for Public-Private Partnership Infrastructure Projects in Multi-Attribute Reverse Auctions

Selection of a sustainable private partner (contractor) is significant to ensure the success of public-private partnership (PPP) projects. In recent years, multi-attribute reverse auctions (MARAs) are widely used in public procurement to select the desirable contractor. However, the MARA mechanism is neglected in the existing studies. The purpose of this paper is to present a MARA framework for selecting a sustainable contractor in PPP infrastructure projects, in which the MARA rules and an integrated winner determination method are involved. In particular, the sustainability considerations are incorporated in the MARA rules, which can make the potential contractors have incentives to improve their sustainable performance. Within the MARA rules, based on the trapezoidal fuzzy linguistic representation model and the classical two-additive Choquet (TAC) integral operator, a winner determination method is developed to evaluate and rank potential contractors, in which both the bid evaluation and the interrelationships among bid evaluation attributes are considered. Finally, the potential of the proposed method is shown through an illustrative case of a PPP project of a subway construction in China. The MARA framework investigated helps governments make reliable decisions in sustainable procurement and thereby facilitates successful project delivery.

Research on the Evaluation Method of Green Construction Project Based on Grey Entropy Correlation

This paper proposes a bid evaluation method based on grey entropy correlation degree for green construction projects. The first, the evaluation index system of a green construction project is constructed based on the technical requirements of a green construction project. The grey entropy method is also used to eliminate the influence of subjective empowerment on the evaluation result. This removal is intended to build the evaluation model based on the grey relational degree of entropy weight, and select the winning bidder by calculating the correlation degree of each bidder and the ideal scheme. Finally, an engineering example shows this method can be applied to the process of evaluating bids of green construction projects. This method can help the tenderer select the winner of the green construction project more objectively and reasonably.

A Bidding Evaluation Method for PPP Project Based on Triangular Fuzzy Multi-attribute Decision Making

How to purchase social capital effectively concerns the success or failure of PPP project. In the bidding process, due to the fuzziness of project information in PPP project, it is difficult for experts to quantify the scores of various indicators of social capital. However, traditional project information is relatively clear. If traditional project evaluation method is simply applied to the PPP project procurement, it is likely to be difficult to accept. Therefore, based on triangular fuzzy multi-attributes decision-making theory, this paper takes the situation that decision makers are unable to give accurate measurement due to the fuzziness of project information into account and selects suitable bidding evaluation indicators to establish corresponding evaluation model. By means of TOPSIS, this model could carry out a comprehensive evaluation of social capital and obtain the ranking quickly by which we could obtain a more reasonable bidding evaluation results of PPP project. The case analysis proves practicality and effectiveness of this model.

The Crash of a Policy Pilot to Legally Define Community Energy. Evidence from the German Auction Scheme

“Community energy” is a highly contested issue not only in the German energy transition governance but also in the recent legislative procedure to recast energy market legislation within the EU’s “Winter Package”. This paper analyses the effects of the privileges for “community energy actors” in the German auction scheme for on-shore wind energy. Those privileges aim to guarantee a level playing field for small actors and to enhance societal acceptance. The results of the first rounds of auctions did not merely reveal an acceptable level of losses due to recognized trade-offs between policy objectives. Instead, the results indicate a complete failure regarding all three objectives of the revised support scheme for renewables—controlled renewable energy expansion, actor plurality and cost efficiency. The paper discusses whether the policy motivations translate appropriately into legislation. It suggests differentiating clearly the economic risks for small actors from the added value that is attributed to community energy actors. De-coupling these—often mixed—motives behind the demands for actor plurality unveils policy approaches that more adequately fit with these distinct motives. The paper finally proposes rather to integrate the politically desired values into the bid evaluation criteria instead of granting privileges to specific actors that are assumed to provide these values.

Evaluation Model and Algorithm of Water Resources and Hydropower Based on ANP

The tendering and evaluation of water conservancy projects is an important part of China's infrastructure construction, and the evaluation of bids is also a key link in the construction of water conservancy projects. In view of the problems in the bid evaluation process for project of water conservancy and hydropower in a certain province, the proportion of subjective elements is large, the proportion of bid evaluation factors is not fixed, the randomness is large, and the external obstacle factors are large. This paper proposes the use of network analysis in the bid evaluation process. The method (ANP) considers the mutual influence and dependence of each index, and establishes a multi-index comprehensive scoring criteria model for the nonlinear combination of indexes. Based on the model establishment process, the algorithm of ANP evaluation model was implemented using C# and applied to the bid evaluation process, which made the evaluation process more scientific and rational.

Hesitant fuzzy preference envelopment analysis and alternative improvement

In the hesitant fuzzy decision-making process, an important issue is to aggregate the hesitant fuzzy information and select the optimal alternatives. How to deal with other non-optimal alternatives? This question has not been clearly answered. To address this issue, this paper proposes the hesitant fuzzy envelopment analysis (HFEA) model based on the defined score per unit. Furthermore, we develop the deviation-oriented hesitant fuzzy envelopment analysis (DHFEA) model and the score-oriented hesitant fuzzy envelopment analysis (SHFEA) model in terms of score and deviation values. Then, their dual forms are derived so that the DHFEA and SHFEA models can be transformed into the linear programming. Based on the calculated results, the non-optimal alternatives can be improved accordingly. Moreover, with respect to the attributes’ differences, this paper constructs the hesitant fuzzy preference envelopment analysis (HFPEA) model by integrating the attributes’ preferences. Similarly, its dual form, linear transformation, and alternative improvement method are investigated respectively. Thus, based on the HFEA and HFPEA models, we can rank all the alternatives and improve the non-optimal ones according to the envelopment values and the obtained parameters. Meanwhile, the decision maker's subjective preferences for the attributes can be considered in the decision-making process. Finally, an illustrative example of bidding evaluation is provided to show the feasibility of the proposed decision-making approaches.

Localisation barriers to trade: The case of South Africa’s renewable energy independent power program

ABSTRACTSouth Africa’s Renewable Energy Independent Power Projects Procurement Program (REIPPPP) has been hailed as one of the most successful programmes of its kind, contracting 92 renewable energy projects totalling 6 328 MW and US$20.5 billion since its inception in 2011. Despite this success, the programme’s use of non-price factors such as local jobs, local black ownership, local content, and local community ownership in bid evaluation has generated criticism and controversy. Lessons learned in other countries about how and when to use policies like import substitution to promote sustainable economic development seem not to have been fully incorporated by the REIPPPP. We therefore offer a cautionary note that dramatic and impressive localisation results are not inevitable – especially considering the size of the South African market and accompanying investment uncertainties – and that there is bound to be a trade-off between price and non-price factors in these kinds of competitive procurement programmes.

Optimal Contractor Selection in Construction Industry: The Fuzzy Way

A purely price-based approach to contractor selection has been identified as the root cause for many serious project delivery problems. Therefore, the capability of the contractor to execute the project should be evaluated using a multiple set of selection criteria including reputation, past performance, performance potential, financial soundness and other project specific criteria. An industry-wide questionnaire survey was conducted with the objective of identifying the important criteria for adoption in the selection process. In this work, a fuzzy set based model was developed for contractor prequalification/evaluation, by using effective criteria obtained from the percept of construction professionals, taking subjective judgments of decision makers also into consideration. A case study consisting of four alternatives (contractors in the present case) solicited from a public works department of Pondicherry in India, is used to illustrate the effectiveness of the proposed approach. The final selection of contractor is made based on the integrated score or Overall Evaluation Score of the decision alternative in prequalification as well as bid evaluation stages.

Suitability of a Consensual Fuzzy Inference System to Evaluate Suppliers of Strategic Products

This paper designs a bidding and supplier evaluation model focused on strategic product procurement, and develops their respective evaluation knowledge bases. The model is built using the most relevant variables cited in the reviewed procurement literature and allows to compare two evaluation methods: a factor weighting method (WM) and a fuzzy inference system (FIS). By consulting an expert panel and using a two-tuples symbolic translation system, strong fuzzy partitions for all model variables are built. The method, based on central symmetry, permits to obtain the fuzzy label borders from their cores, which have been previously agreed among experts. The system also allows to agree the fuzzy rules to embed in the FIS. The results show the FIS method’s superiority as it allows to better manage the non-linear behavior and the uncertainty inherent to the supplier evaluation process.

The Conjugated Triangle Method CTM of the detection of inconsistent bids in the construction industry

The existing system of bids evaluation in the construction industry does not bring the clients the certainty if all placed bids comprise real, achievable prices. Especially in the road construction sector, where the earthworks create significant part of the works, comparing e.g. the price of 1 km of roads often gives misleading results. The paper comprises the complete proposal to modify the scope of information provided by offerors in the public procurements (in the construction industry) allowing the clients to determine easily if the contractors have placed the consistent offers i.e. if the bid prices are not too high and if the lowest bid price is not a dumping price. The Conjugated Triangle Method (CTM) of inconsistent bid detection in construction industry is based on the three inter-related parameters: means of production, time of works, on the value of works. Regardless of the offered price it should match the other two parameters.

Group Decision Support System (GDSS) Untuk Evaluasi Penawaran Pekerjaan Konstruksi Menggunakan Metode AHP dan Borda

Evaluation of bids by WG ULP has an important role in the selection of providers of construction work to determine the potential winner. A group decision support system is a system that can help the Working Group ULP Bali provincial government in making decisions with the ability to analyze the construction work provider selection criteria with AHP and Borda method. With GDSS bid evaluation, all members of the Working Group can evaluate the ULP provider offering construction work optimally based on the criteria of administrative, technical prices so as to improve the quality of the repair process of group decision-making. Both methods are used because there are two stages in the decision-making that decision of individual and group decision. The test results show that the system can be applied GDSS as decision support systems in the bid evaluation provider of construction work and decided the company's most worthy to be a winner

TENDERS THEORY FOR STIMULATION ECOLOGICAL-ORIENTED BUSINESS

The article deals with the theoretical and methodological foundations for holding tenders in order to stimulate the environmentally oriented business. The essence of the state stimulating tender for the introduction of business, taking into account the ecological component, which should cover enterprises of different regions of Ukraine, is considered. The purpose of the tender is defined, which is to regulate the state organization of economic and environmental incentives for business entities, which should allocate funds for the implementation of environmental activities. The principles for the implementation of state tenders to stimulate environmental activities conducted by an environmentally-oriented business are: fair competition among participants; maximum savings and efficiency; openness and transparency at all stages; non-discrimination of participants; objective and unbiased evaluation of tender bids; preventing collusion, corruption and abuse. Depending on the way of carrying out state bidding, on stimulating enterprises of eco-oriented business, there are: open; open with prior qualification; trades with limited participation; two-stage bidding; request procedures for the amount of incentive financing. The terms of the tender, which are approved by the tender committee prior to announcement of the tender and are obligatory for its participants to be fulfilled, are determined. In examining, evaluating an application for participation in a tender, the Tender Committee has the right to demand additional economic and ecological information from the applicants, which characterizes the opportunity of renderers� to develop state-funded funds for environmental protection measures provided for in the tender documentation. The financing of the tender is carried out at the expense of state funds and funds of the applicants who wish to take part in the tender. The size of the payment for participation in the tender is determined by the working group and approved by the tender committee together with the estimate for the organization and holding of the tender. These funds are sent to a separate account of the tendered and are used for payment of press releases, premises rent, business trips, communications, development, coordination, reproduction, translation of documents, negotiations, conferences, etc.

Corrupt Practices in the Construction Industry: Survey of Ghanaian Experience

Across the globe, corruption presents a major risk that reduces construction project performances by inflating costs and reducing the quality of the infrastructure commissioned. In developing countries, corruption stifles economic development and engenders social inequality. Using a structured questionnaire survey to elicit direct knowledge and lived experiences of construction practitioners, this study uncovered the prevalence and forms of corrupt practices within the developing country of Ghana. Research findings illustrate that habitual corruption and unethical behavior prevail among public officials, contractors, and construction professionals during the bid evaluation, tendering, and contract implementation stages of a construction contract. This research proffers that corruption is driven by a toxic concoction of high political connections, excessive and reckless sole sourcing of public construction projects, lack of commitment by construction companies in addressing corruption, and the inherently idiosyncratic operational environment of the construction sector. The top five forms of corruption frequently encountered, in descending order, are kickbacks (extortion), bribery, collusion and tender rigging, conflict of interest, and fraud. This research presents a rare glimpse of construction industry corruption in a developing country and provides polemic clarity geared to intellectually challenge readers in government and industry. Future work is required to explore and develop appropriate countermeasures to address corrupt practices and behaviors.

The Committee System for Competitive Bids in Local Government

When a municipality contracts for goods or services, it must make use of competitive bidding / a public call for tenders for contracts over R200 000 as well as for long term contracts. A competitive bidding process generally consists of different stages, for example, compiling bid specifications, advertising the bid, the receipt and evaluation of bids, and the award and implementation of the contract. The Municipal Supply Chain Management Regulations require a municipality’s Supply Chain Management Policy to provide for a committee system to oversee the different stages. Such committee system must, moreover, consist of at least a bid specification committee, a bid evaluation committee and a bid adjudication committee. Until recently, little attention has been given by the courts to the roles and composition of the different committees in the committee system. It is only after government, and in particular, municipalities have begun to implement the committee system in their procurement processes that it is evident that problems are arising. In recent months, the courts have increasingly had to deal with issues pertaining to the implementation of the committee system.
 In this article, the relevant legislative provisions on the committee system for competitive bids in local government are discussed. The functions of each committee are explained and all the cases that have thus far involved the implementation of the committee system are critically analysed. Much attention is given to the cases since they serve as a warning to municipalities to uphold and comply with the rules relating to the roles and composition of the different committees. The cases illustrate how important it is for municipalities to ensure that the different committees are properly constituted and that decisions at meetings are properly taken. They also highlight the importance of the supervisory role of the municipal manager over the different committees. In light of the cases it is clear that failure to comply with all the legislative requirements results in very costly litigation.
 

Reliance on and Reliability of the Engineer’s Estimate in Heavy Civil Projects

To the contractor, the engineer’s estimate is the target number to aim for, and the basis for a contractor to evaluate the accuracy of their estimate. To the owner, the engineer’s estimate is the basis for funding, evaluation of bids, and for predicting project costs. As such the engineer’s estimate is the benchmark. This research sought to investigate the reliance on, and the reliability of the engineer’s estimate in heavy civil cost estimate. The research objective was to characterize the engineer’s estimate and allow owners and contractors re-evaluate or affirm their reliance on the engineer’s estimate. A literature review was conducted to understand the reliance on the engineer’s estimate, and secondary data from Washington State Department of Transportation was used to investigate the reliability of the engineer’s estimate. The findings show the need for practitioners to re-evaluate their reliance on the engineer’s estimate. The empirical data showed that, within various contexts, the engineer’s estimate fell outside the expected accuracy range of the low bids or the cost to complete projects. The study recommends direct tracking of costs by project owners while projects are under construction, the use of a second estimate to improve the accuracy of their estimates, and use of the cost estimating practices found in highly reputable construction companies.

Research on the Green Construction Bid Evaluation Model Based on Grey Clustering Methods

With the continuous promotion of railway green construction, the green construction enterprises have become the focus of attention of tenders. In order to improve the traditional evaluation method, we redefine the green construction bidding process and establish a reasonable evaluation index system of railway green construction,and construct the AHP-Gray Clustering Bid Evaluation Method by combining the analytic hierarchy process with the gray system theory Method. In order to make the evaluation index meet the requirements of quantitative analysis as far as possible, and by taking the maximum possible resolution of human thinking ability into consideration, the indicators are divided into excellent, good, medium, qualified, slightly poor, poor 6 gray grades, and are respectively assigned scores, which forms a vector of evaluation index level value. The weighted average is calculated and the overall score of every tender is obtained by combining the assessment results of the merits and demerits of the indicators with the level value of vector, and the final order of merits and demerits is determined to choose the best winning bidder for the owners. Finally, this evaluation model is applied to the ZhongChuan Railway project for empirical analysis, which verifies the feasibility of the method in the green construction project evaluation.

An enhanced reverse auction framework for relief procurement management

An enhanced reverse auction framework is developed for procuring excess required relief items for humanitarian organizations at post-disaster. Given the input data tainted with epistemic uncertainty, two novel possibilistic models are developed to support the bidders and the auctioneer who is a coordinating platform (CP), regarding the bid construction and bid evaluation, respectively. First, using the bid construction model, competing suppliers determine their suggestions regarding the unit prices, quantities, and delivery times of relief items as well as the most appropriate transportation modes. Afterwards, the CP runs the bid evaluation model to assess the submitted bids by which the best portfolio of suppliers and their allocated orders are determined. An illustrative numerical example inspired by a real practice is provided to demonstrate the applicability of the proposed decision models. Several sensitivity analyses are also conducted on key parameters from which useful managerial insights are drawn.

Equipment Procurement Bidding Evaluation Method Based on PPM

It is the vital significance to ensure competitive procurement bidding success which constructing the bidding evaluation index and selecting the scientific evaluation method. The Projection Pursuit Method (PPM) transforms the operational effectiveness index of equipment procurement bidding into one-dimensional projection value, gets the weight of each main factors index, constructs the evaluation model for the equipment procurement bidding evaluation, gets the evaluation rank of the alternative programme sample, and evaluates the example of the equipment procurement bid. The results show that PPM is the scientific method for competitive procurement bidding evaluation.

A comparative study of formulas for choosing the economically most advantageous tender

Choosing the best bid is a central step in any tendering process. If the award criterion is the economically most advantageous tender (EMAT), this involves scoring bids on price and quality and ranking them. Scores are calculated using a bid evaluation formula that takes as inputs price and quality, and their respective weights. The choice of formula critically affects which bid wins. We study 38 such formulas and discuss several of their aspects, such as how much the outcome of a tender depends on which formula is being used, relative versus absolute scoring, ranking paradox, iso-utility curves, protection against a winner with an extremely high price, and how a formula reflects the weights of price and quality. Based on these analyses, we summarize the (dis)advantages and risks of certain formulas and provide associated warnings when applying certain formulas in practice.