Investigating the influence of procurement method selection on project performance in Libya

Abstract

Construction Project Procurement Methods (PMs) define the roles, relationships and responsibilities of project team members and the sequence of the activities required to construct or provide a facility. A number of different PMs have evolved over the years, but each is characterised by a different set of features upon which the criteria for selecting the most appropriate method to procure a given project must be based, if successful project performance (PP) is to be ensured. The use of procurement method selection criteria (PMSC) to inform clients’ decision on suitable PMs to adopt remains a recommended good practice in the construction industry. However, project clients in the Libya Construction Industry (LCI), continue to face great challenges when it comes to selecting the most appropriate PM for its projects. The general practice in this industry is largely dominated by a culture of clients’ reliance on their familiarity and experience with a particular method to inform their PM choice, with no consideration of the plethora of other PMs and use of rational approaches to aid in this decision-making. This procurement issue has long been recognised as a major contributory factor to the frequent time and cost overruns often experienced by projects in the LCI. Although the selection of an appropriate PM to procure any given project is known to result in success PP and (and vice versa), very little is known about the nature of this relationship from literature. Having persistently suffered a great deal of project failures over the years, the LCI stands to benefit from detailed knowledge and understanding of how exactly PM choice do actually influence PP. Stimulated by the dearth of this information, this thesis reports on a research investigation into this relationship with the aim of developing a model to explain the criteria functions in contributing to PP and their implications to PM selection practice in Libya. The methodological approach adopted for this research was the mixed method, i.e., using a combination of both quantitative and qualitative approaches. Following a critical review of the extant relevant literature, a number of relevant hypotheses were first formulated, together with a conceptual framework, to establish the theoretical basis underpinning this research, namely the relationship between the selection of PMs (based on PMSC) and PP. The primary data collection stage involved an initial field questionnaire survey aimed at identifying and confirming the key areas of the research inquiry that needs focusing on. This was followed by a semi-structured questionnaire and interview surveys. With the aid of SPSS and Excel, the collected data were analysed, followed by the development of a mathematical model (based on regression) that demonstrate the influence of PMSC on PP. Finally, the model was validated by expert interviews to test for its validity and reliability. The key findings of the research include the identification of DBB and DB selection criteria that contributes to PP. The distinct contribution to knowledge arising from this research includes the development of a regression model to demonstrate this relationship between PMSC and PP. The benefit of these outputs lies not only in the ability of LCI’s clients to make PM selection decisions much faster by virtue of the need for them to only focus on the criteria with significant influence on PP, they are also able to work out, in quantitative terms, the PP outcomes to be expected for each of the method being considered. This latter information would enable clients to compare the PP outcome values expected from their decisions to select DBB and DB, and then be able to conclude which of these two options represents a better procurement strategy for any given project at hand.