Modern Construction Management by Frank Harris & Ronald McCaffer

Author:Frank Harris & Ronald McCaffer [Harris, Frank]
Language: eng
Format: epub
Publisher: Wiley
Published: 2013-02-28T00:00:00+00:00

Differences Between Contractors’ Behaviour Patterns

Column 5 in Table 10.1 indicates that some contractors have more low bids than is normally expected and some have more high bids. It also indicates that the majority have a reasonable share of high and low bids. A study of observed bids for some contractors by McCaffer revealed that there are occasions when contractors who in the long term have equal shares of high and low bids have phases of varying length when they display a run of low bids or high bids. These phases, when identified, help differentiate the less serious competitors from the more serious.

This approach can be improved upon by calculating the cumulative sum of (bid – mean bid)/mean bid and plotting the results, as shown in Fig. 10.8. This value has been given the name cusum value. An analysis of this type for some 600 contracts involving almost 400 contractors, performed by McCaffer, showed that there were only 15 per cent of cases when the winning bidder had a rising graph preceding their winning bid. Conversely, there were 85 per cent of cases when the winning bidder had a declining graph. Table 10.2 summarises the number of occasions when a winning bid was preceded by a drop of one, two, three, four or five steps (a step being a previous bid, each bid being taken in date order). The production of such graphs is useful in identifying work-hungry competitors.

Fig. 10.8 Cusum plot for one contractor.

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