Canadian construction participants have long recognized that accepting the lowest price bid does not guarantee maximum value. Achieving a value-based procurement approach is a challenge, particularly for the Canadian public sector clients who are limited in their ability to evaluate the competitive bids based solely on the low-bid award system. Bid and cost data from 218 projects from three major public sector construction clients in the Greater Toronto Area are evaluated. Compared to the other clients, the cost escalation is significantly higher for the client that does not have a standard prequalification policy. Increased contractor competition (high number of bids) and a large price gap between low bid and other bids are correlated to higher cost escalation for the non-prequalifying client. Also, the organizational culture of the non-prequalifying client is less results-oriented. The research demonstrates the importance of prequalifying for clients that award based solely on the low bid.
| Identifer | oai:union.ndltd.org:TORONTO/oai:tspace.library.utoronto.ca:1807/18166 |
| Date | 16 December 2009 |
| Creators | Bedford, Thomas |
| Contributors | McCabe, Brenda |
| Source Sets | University of Toronto |
| Language | en_ca |
| Detected Language | English |
| Type | Thesis |
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