Application of Limit State Theory to Tender Adjudication

摘要

Approximate reliability analysis provides a useful vehicle for the development of project risk management methodology. The conceptual and theoretical basis for First Order Second Moment reliability analysis, as applied to project cost estimates, has been developed in the form of the Limit State Cost Function (LSCF). This paper presents the application of the LSCF to tender adjudication, for admeasure bill of quantities type contracts, by modelling the variability of the quantity estimates. The reliability of project performance is measured against each tender submitted. The results of the analysis allocate the available contingency to items on the bill of quantities. This develops insight into the tendering strategies employed, by modelling the likely areas of cost over-run for each of the submitted tenders. The application of the methodology is demonstrated in the form of a case study.