One of the biggest challenges of any construction project is controlling costs. Change orders, unexpected expenses, and scheduling issues can all send costs spiraling higher. To combat this, many project owners turn to low-bid procurement in order to secure the lowest price. According to a recent survey conducted by professors in Colorado and Georgia with funding from the American Council of Engineering Companies and the American Public Works Association, that approach might be part of the problem.

The survey, titled “An Analysis of Issues Pertaining to Qualifications-Based Selection,” found that when the designers or engineers for a project are chosen through Qualifications-Based Selection (QBS), there are fewer change orders, less construction cost growth, and less schedule growth than the industry average.

Because QBS allows the project owner to select the design team based on experience and technical skill and then negotiate a price, survey respondents indicated that it led to stronger relationships between owners and designers. The research also found that projects using QBS tended to produce lower overall costs, likely because the design phase has a disproportionate impact on the long-term performance of the project, including factors like safety and energy efficiency.

As the United States continues to work its way out of the recession, project owners are all looking to control costs. Despite the obvious temptation to move toward low-bid procurement, QBS may well be the better – and cheaper – approach after all.

Contributed by Brent Bridges

Posted by Blog Contributor at 07/15/2010 01:23:49 PM