Best value procurement for contractor selection in the Malaysian construction industry

Abstract

Construction activities are generally prone to risks, which affect the final project performance. Therefore, a construction client must ensure that the most crucial task of selecting a suitable contractor is successfully carried out to achieve an acceptable project results. This study is aimed to assess a list of contractor selection criteria that are contributed with best value procurement (BVP) in Malaysia. A total of 31 selection factors have been identified. 26 respondents to this study were asked to assess the importance of the identified factors. Moreover, the respondents were also asked about the actual contractor selection criteria used in current practice of Malaysia. List of 17 actual criteria was prepared based on the information obtained from professionals in the Malaysian construction industry. Data collected were analyzed using the IBM Statistical Package of Social Sciences (SPSS). The analysis showed that each category of the respondents rated the importance of the identified criteria based on its perspective and experience. However, some factors were mutually agreed among the categories such as financial capability, past experience and expertise, ability to manage client satisfaction and expectation and the ability to meet the design requirements which reflects the importance of these criteria while on the other hand, Political consideration, number of staff and history of claims and disputes were found to be the least important three factors to be considered in the contractor selection from the identified factors. It was also found that most of significant actual criteria practiced in Malaysia for the contractor selection are considered in best value selection criteria which indicates that the identified selection criteria of best value procurement is considered sufficient in Malaysia.