MULTI CRITERIA DECISION MAKING MODEL FOR SELECTION OF DESIGN-BUILD SUBCONTRACTORS IN EPC/TURNKEY CONTRACTS

Abstract

A major proportion of construction projects are executed by subcontractors in the construction Industry. The project’s success and the main contractor’s ability to complete the project within specified duration, cost and quality depends highly on the capability of subcontractors. In an Engineering Procurement & Construction (EPC) and turnkey contract, the subcontracted work may also include the design of a specialized work where the main contractor lacks experience. The selection of qualified subcontractors is crucial for successful completion of a project and an accurate and realistic bid proposal as the project cost may vary significantly due to design changes. Subcontractor selection is based on a set of criteria that helps the main contractor in deciding the most suitable subcontractor for the desired job. However, there is no set of identified criteria for the selection of design-build subcontractors in EPC/turnkey contracts. This study aims to identify key qualification factors and develop a multi-criteria decisionmaking model for the selection of design-build specialty subcontractors in an EPC/turnkey contract. A total of 25 key factors are shortlisted by virtue of a thorough literature review and preliminary survey. Afterwards, through an extensive literature review, these factors were categorized into 7 main criteria. A pair-wise comparison of criteria and factors was carried out using Analytical Hierarchy Process (AHP). The resultant weightages were then used to develop a multi-criteria decision-making model. Results show that the key criteria include cost, management and technical ability, and reputation of a subcontractor. To validate the finding of this model, data was collected from 5 case studies of EPC/turnkey building projects. The finding indicates that ‘Proposed tender price’ is considered the most important factor followed by ‘past success’ and ‘Relationship with the contractor’ for awarding contract.