Free Essay Example - Contractor's Selection Criteria

The selection of a contractor is a vital tool for managing the safety of contractors and minimizing workplace incidents and accidents. According to Morkunaite, Podvezko, and Kutut (2017, 90), the process of selecting the right contractor entails assessing the contractor's safety performance, documented injury rates, employee's compensation, the competency level of the contractor's personnel and periodic safety programs being implemented. Therefore, the process of selecting contractors evaluates the contractor’s capability to work safely, how effectively the safety program is performed as well and the safety competency evaluation undertaken to comply with the workplace safety management. The selection of contractors demands a useful and detailed review of the contract safety precautions during the bidding meeting as well as pre-award meetings. Consequently, for the contractor to prove their competence, several pre-qualification processes are carried out in accordance with the safety management preferences of the client. The best approach to ensure that the project gets highly qualified and certified personnel out of the contract pre-qualification contract process. The pre-qualification of contractors plays a crucial role in creating a pool of contractors with the desired capacity and quality to work on the project. Indeed, this process helps to get rid of contractors with a history of claims, litigation as well and performance-related failures.

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How to Develop A Contractor’s Selection Criteria?

In order to advance a contractor's selection criteria, it takes the following processes prequalification and bid evaluation decisions. These criteria consist considers three fundamental issues (i) criteria for prequalification (ii) criteria for the prequalification process.

Criteria for The Prequalification Process

The pre-qualification process is used to examine as well as assess the contractor’s abilities to conduct. Prequalification offers a user with a list of service providers invited to tender on a continued basis. In order to gain access to an accepted standing list, a service provider should have earlier on applied to the client, which is then evaluated based on organizational structure, financial strength, technical expertise, managerial competence, and past record of comparable construction. The pre-qualification process consists of the contractor’s adequacy of equipment and plant to work adequately, the appropriateness of financial capacity to attain the required work obligations and the technical capability and experience appropriateness (Rao, Kumar, and Kumar, 2018, p.73). The number of candidates for prequalification is, in most cases, greater than the client; hence clients should decrease the number of service providers to a short list. This course is often undertaken subjectively, and this criterion is utilized to reduce the list based on the size of the contract. The shortlist should then be subjected to a comprehensive analysis to ascertain the present condition of each contractor's managerial, technical, and financial capability. The monetary investigation entails an update of the monetary statements as well as checks regarding the financial exposure of the organization.

Technical evaluations are majorly concerned with the present plant and labor resources commitment, as well as the size of work quality. These assessments are done by visiting the construction site through conventions to deliberate general terms of the building work and client requirements. In addition, managerial expertise and organization help identify a managerial method to risk, claims, contract policy, as well as variations.

Criteria for Bid Evaluation

Evaluation is a term that is used to define the technique for the valuation of tender offers submitted by prequalified service providers. Research has shown that an appropriate bid list should be made jointly between the client and engineer as well as contractors who have initially qualified (El-Sayegh et al., 2019, p.3). Also, there is a need to review the prequalification records to ensure that both the client and the engineer in every bidder have the right financial capability to put up with the cash flows through the project; have experience and competency of for similar projects, in addition to the plant capability to accomplish the project within the contract constraints. On top of that, they should possess technical capabilities that are sufficient to satisfy the contract requirements and completely comprehend the scope for similar projects, have the ability to absorb consequent changes and facilities such as quality control and testing that is necessary to endorse quality assurance and complying with all health and safety laws (Hasnain, Thaheem, and Ullah, 2018, p.697). In this regard, the construction industry contractors play a significant influence on the success of the project. Indeed, a competent construction contractor should possess indispensable features to enhance profitability, competitiveness, and performance. The bid evaluation process assesses the following aspects:

Financial Stability: Financial stability makes an appearance in nearly all prequalification team list, as it indicates the capability of the contractor to realize the financial commitments. In general, this criterion comprises an assessment of the financial state of every contractor’s interest expression (Rao, Kumar, and Kumar, 2018, p.70).

Contractor-Client Relationship: Ayettey, and Danso (2018, p.281) suggested that earlier interaction between the contractor and the owner plays a critical role in selecting a contractor since most clients prefer working with contractors that have produced previous projects within a given time and cost as well as quality benchmarks. Therefore, contractor prequalification aids in eliminating contractors who are not competent, and responsible, supports healthy competition amongst eligible contractors, minimizes the risk of contractor failure and boost client satisfaction.

Contractor Experience: The contractor experience consists of past performance that is aligned with the kind of projects accomplished with respect to scope, size, and nature. Experience demonstrates the contractor's capability to allocate resources and the ability to utilize resources effectively.

References

Ayettey, D.N.A., and Danso, H., 2018. Contractor selection criteria in the Ghanaian construction industry: Benefits and challenges. Journal of Building Construction and Planning Research, 6(4), pp.278-297. https://doi.org/10.4236/jbcpr.2018.64019

El-Sayegh, S.M., Basamji, M., Haj Ahmad, A., and Zarif, N., 2019. Key contractor selection criteria for green construction projects in the UAE. International Journal of Construction Management, pp.1-11. https://doi.org/10.1080/15623599.2019.1610545

Hasnain, M., Thaheem, M.J., and Ullah, F., 2018. Best value contractor selection in road construction projects: ANP-based decision support system. International Journal of Civil Engineering, 16(6), pp.695-714. https://doi.org/10.1007/s40999-017-0199-2

Morkunaite, Z., Podvezko, V., and Kutut, V., 2017. Selection criteria for evaluating contractors of cultural heritage objects. Procedia Engineering, 208, pp.90-97. https://doi.org/10.1016/j.proeng.2017.11.025

Rao, M.K., Kumar, V.S.S., and Kumar, P.R., 2018. Optimal contractor selection in the construction industry: the fuzzy way. Journal of the Institution of Engineers (India): Series A, 99(1), pp.67-78. https://doi.org/10.1007/s40030-018-0271-1