Work

Integration of Simulation‐Based Cost Model and Multi‐Criteria Evaluation Model for Bid Price Decisions

Year: 2007

Type: article

Abstract: : Several criteria affect bidding decisions. Current bidding models determine a markup based on a fixed project construction cost. This work presents a novel bid price determination procedure that is built by integrating a simulation-based cost model and a multi-criteria evaluation model. The cost model is used to consider cost uncertainties and generate a bid price cumulative distribution, whereas the multi-criteria evaluation model applies pairwise comparisons and fuzzy integrals to reflect bidder preferences regarding decision criteria. The relationship between the two models is based on a practical phenomenon in that a bidder has a high probability of winning when criteria evaluations favor his bid, and, consequently, the bidder would bid a low price, and vice versa. The merits of the proposed procedure are demonstrated by its application to two construction projects in Taiwan.

Source: Computer-Aided Civil and Infrastructure Engineering

DOI: 10.1111/j.1467-8667.2007.00480.x

Authors: Wei‐Chih Wang, Ren‐Jye Dzeng, Yu‐Huang Lu

Institution: National Yang Ming Chiao Tung University

Language: English

Topic: Construction Project Management and Performance

Subfield: Management Science and Operations Research

Field: Decision Sciences

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $5,230

Funder: National Chiao Tung University