Authors: Jeroen Vanderijt; Sicco Santema; Wibe Witteveen
Abstract
Best Value Procurement (BVP, Kashiwagi, 2010) is a procurement process where
performance is primary over price. The methodology fits in the category of Most
Economically Advantageous Tender (MEAT). The delivery of construction services has
traditionally a low performance (see e.g. Kashiwagi, 2009.) BVP originated in construction
services and has been applied over 700 times, delivering construction services worth over
$2.3B (1994-2010). BVP is now also used outside the construction industry to successfully
deliver commodities (eg. office supplies), professional services (engineering), nonconstruction
services (cleaning), and Information Technology services.
The method has mainly been used in the United States. The last few years BVP is also used
in other countries as well. In The Netherlands, BVP was introduced in 2005 by a large
general contractor. Since then, numerous tenders have been performed using BVP, worth of
more than 1 bln euro’s, inside and outside the construction industry. The objective of the this
paper is to show that the classic problems in construction industry are supply chain issues in
the procurement area, and not caused by the complexity of the construction itself.
The main research question of this paper is: ‘What lessons can be learned from the first years
of using Best Value Procurement in The Netherlands ?’
In order to answer this question, we have applied case study research, using 6 cases in
construction services in The Netherlands. Based on the results, we conclude that we can use
use qualitative scales without further desegregation, that the project goals should be very
clear, since they form a central role in the selection process, that BVP enables market parties
to differentiate themselves from their competitors, that BVP delivers value for money to the
owner and that objectivity, non-discriminatory and transparency can be realized. Thus BVP
adds value and performance in the delivery of construction services.
Key words: Best Value Procurement, Value, Supply Chain
Journal: ( – )
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Conference: Glasgow, Scotland (2011)