Scoring rules and abnormally low bids criteria in construction tenders: A taxonomic review

Ballesteros-Pérez, Pablo, Skitmore, Martin, Pellicer, Eugenio, & González-Cruz, M. Carmen (2015) Scoring rules and abnormally low bids criteria in construction tenders: A taxonomic review. Construction Management and Economics, 33(4), pp. 259-278.

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Abstract

In the global construction context, the Best Value or Most Economically Advantageous Tender is becoming a widespread approach for contractor selection, as an alternative to other traditional awarding criteria such as the Lowest Price. In these multi-attribute tenders, the owner or auctioneer solicits proposals containing both a price bid and additional technical features. Once the proposals are received, each bidder's price bid is given an economic score according to a scoring rule, generally called an Economic Scoring Formula (ESF) and a technical score according to pre-specified criteria. Eventually, the contract is awarded to the bidder with the highest weighted overall score (economic + technical). However, Economic Scoring Formula selection by auctioneers is invariably and paradoxically a highly intuitive process in practice, involving few theoretical or empirical considerations, despite having being considered traditionally and mistakenly as objective, due to its mathematical nature. This paper provides a taxonomic classification of a wide variety of ESF and Abnormally Low Bid Criteria (ALBC) gathered in several countries with different tendering approaches. Practical implications concern the optimal design of price scoring rules in construction contract tenders, as well as future analyses of the effects of ESF and ALBC on competitive bidding behaviour.

Impact and interest:

3 citations in Scopus
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2 citations in Web of Science®

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ID Code: 86486
Item Type: Journal Article
Refereed: Yes
Keywords: Bidding, Tendering, Scoring rules, Competitiveness, International comparison
DOI: 10.1080/01446193.2015.1059951
ISSN: 0144-6193
Divisions: Current > Schools > School of Civil Engineering & Built Environment
Current > QUT Faculties and Divisions > Science & Engineering Faculty
Copyright Owner: Copyright 2015 The Author(s). Published by Taylor & Francis
Deposited On: 10 Aug 2015 02:19
Last Modified: 06 Sep 2016 13:04

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