Exploring the Influences on Construction Bidding Decisions: Insights from Literature and Industry Experts
Publication: Construction Research Congress 2024
ABSTRACT
Decision-making in construction bidding is one of the complicated processes. In determining related decisions, contractors weigh various bidding factors to assess the expected benefits of a construction project. Various studies have identified factors that impact construction bidding-related decisions. However, there is a lack of research that examines the alignment between industry and literature as related to the perception of the importance of bidding factors on bidding decisions. This paper fills this area of research need. First, the authors performed a content analysis of 124 construction bidding-related journal papers, and accordingly, 43 bidding factors were identified and mapped with analyzed journal papers. Second, the authors developed a survey to gauge the perception of industry experts about the influence of the identified bidding factors and collected 82 responses. Thereafter, a statistical analysis was conducted to investigate the alignment between literature and industry. The results indicated that some bidding factors have been understudied in literature compared to their perceived industry importance such as risk of fluctuation in labor, equipment, or material price, contractor’s risk attitude, and value of liquidated damages. Ultimately, this study adds to the body of knowledge by identifying any misalignment between the industry needs and research efforts on construction bidding.
Get full access to this article
View all available purchase options and get full access to this chapter.
REFERENCES
Abdul Nabi, M., El-adaway, I. H., Assaad, R., and Ahmed, M. O. (2022). Prioritization of Project Factors Affecting the Use of Modular Construction: Comparison Between the Perspectives of Industry and Literature. In Proceedings of the Canadian Society of Civil Engineering Annual Conference 2021: CSCE21 Construction Track Volume 1 (pp. 569–582). Singapore: Springer Nature Singapore.
Ahmed, M. O., and El-adaway, I. H. (2022). An integrated game-theoretic and reinforcement learning modeling for multi-stage construction and infrastructure bidding. Construction Management and Economics, 1–25.
Ahmed, M. O., El-adaway, I. H., and Coatney, K. T. (2022). Solving the negative earnings dilemma of multistage bidding in public construction and infrastructure projects: A game theory–based approach. Journal of management in engineering, 38(2), 04021087.
Ahmed, M. O., El-adaway, I. H., Coatney, K. T., and Eid, M. S. (2016). Construction bidding and the winner’s curse: Game theory approach. Journal of Construction Engineering and Management, 142(2): 04015076.
Assaad, R., and El-adaway, I. H. (2021). Guidelines for responding to COVID-19 pandemic: Best practices, impacts, and future research directions. Journal of management in engineering, 37(3), 06021001.
Associated General Contractors. (2022). AGC Construction Inflation Alert. https://www.agc.org/sites/default/files/users/user21902/Construction%20Inflation%20Alert%20Cover_Jul2022_V4.pdf. Accessed March 27, 2023.
Bagies, A., and Fortune, C. (2006). Bid/no-bid decision modelling for construction projects. In Proc., 22nd Annual ARCOM Conf., 511–521. Birmingham, UK: Association of Researchers in Construction Management.
Biernacki, P., and Waldorf, D. (1981). Snowball sampling: Problems and techniques of chain referral sampling. Sociological methods & research, 10(2), 141–163.
El-adaway, I. H., Ali, G., Assaad, R., Elsayegh, A., and Abotaleb, I. S. (2019). Analytic over-view of citation metrics in the civil engineering domain with focus on construction engineering and management specialty area and its subdisciplines. Journal of construction engineering and management, 145(10), 04019060.
Finity, J. (2022). 7 Reasons Why Construction Companies Fail (and How To Avoid It). Accessed March 20, 2023. https://www.levelset.com/blog/why-construction-companies-fail/.
Friedman, L. (1956). A competitive-bidding Strategy. Operations Research, 4(1), 104–112.
Han, S. H., Diekmann, J. E., and Ock, J. H. (2005). Contractor’s Risk Attitudes in the Selection of International Construction Projects. Journal of Construction Engineering and Management, 131(3), 283–292.
Kamal, A., Abas, M., Khan, D., and Azfar, R. W. (2022). Risk factors influencing the building projects in Pakistan: from perspective of contractors, clients and consultants. International Journal of Construction Management, 22(6), 1141–1157.
Khalef, R., Ali, G. G., El-adaway, I. H., and Gad, G. M. (2022). Managing construction projects impacted by the COVID-19 pandemic: a contractual perspective. Construction management and economics, 40(4), 313–330.
Li, G., Chen, C., Zhang, G., and Martek, I. (2019). Bid/no-bid decision factors for Chinese international contractors in international construction projects. Engineering, Construction and Architectural Management, 27(7), 1619–1643.
Moher, D., Liberati, A., Tetzlaff, J., Altman, D. G., and PRISMA Group. (2009). Preferred reporting items for systematic reviews and meta-analyses: the PRISMA statement. J. Clin. Epid., 62(10):1006–12.
Perera, K., Wijewickrama, M. K. C., Ranaweera, S., and Gamage, I. (2019). Significant factors influencing the bid mark-up decision of infrastructure projects in Sri Lanka. International Journal of Construction Management, 21(8), 769–783.
Rastegar, H., Arbab Shirani, B., Mirmohammadi, S. H., and Akhondi Bajegani, E. (2021). Stochastic Programming Model for Bidding Price Decision in Construction Projects. Journal of Construction Engineering and Management, 147(4), 04021025.
Shokri-Ghasabeh, M., and Chileshe, N. (2016). Critical factors influencing the bid/no bid decision in the Australian construction industry. Construction Innovation, 16(2), 127–157.
Siegel, S., and Castellan, N. J. (1987). Nonparametric statistics for the behavioral sciences. McGraw Hill, New York.
Stillwell, W. G., Seaver, D. A., and Edwards, W. (1981). A comparison of weight approximation techniques in multiattribute utility decision making. Organizational behavior and human performance, 28(1), 62–77.
Yuan, X. X. (2011). A correlated bidding model for markup size decisions. Construction Management and Economics, 29(11), 1101–1119.
Information & Authors
Information
Published In
Construction Research Congress 2024
Pages: 350 - 360
History
Published online: Mar 18, 2024
Authors
Metrics & Citations
Metrics
Citations
Download citation
If you have the appropriate software installed, you can download article citation data to the citation manager of your choice. Simply select your manager software from the list below and click Download.