International Construction Specialty Conference of the Canadian Society for Civil Engineering (ICSC) (5th : 2015)

Factors impacting selection of construction subcontractors Dolama, Maryam Ghaffari; Sadeghpour, Farnaz Jun 30, 2015

Your browser doesn't seem to have a PDF viewer, please download the PDF to view this item.

Item Metadata

Download

Media
52660-Dolama_M_et_al_ICSC15_335_Factors_Impacting_Selection.pdf [ 729.65kB ]
52660-Dolama_M_et_al_ICSC15_335_Factors_Impacting_Selection_slides.pdf [ 1.07MB ]
Metadata
JSON: 52660-1.0076446.json
JSON-LD: 52660-1.0076446-ld.json
RDF/XML (Pretty): 52660-1.0076446-rdf.xml
RDF/JSON: 52660-1.0076446-rdf.json
Turtle: 52660-1.0076446-turtle.txt
N-Triples: 52660-1.0076446-rdf-ntriples.txt
Original Record: 52660-1.0076446-source.json
Full Text
52660-1.0076446-fulltext.txt
Citation
52660-1.0076446.ris

Full Text

5th International/11th Construction Specialty Conference 5e International/11e Conférence spécialisée sur la construction    Vancouver, British Columbia June 8 to June 10, 2015 / 8 juin au 10 juin 2015   FACTORS IMPACTING SELECTION OF CONSTRUCTION SUBCONTRACTORS Maryam Ghaffari Dolama1,2 and Farnaz Sadeghpour1  1 Department of Civil Engineering, University of Calgary, Calgary, Canada 2 maryam.ghaffaridolam@ucalgary.ca Abstract: A considerable portion of the work in construction projects is carried out by subcontractors. The current lowest bid practice, in which the main contractor offers a subcontract to the bidder who submits the lowest price, is considered to leave subcontractors with very low profit margins, and with a lack of motivation to provide high quality work. Selecting appropriate subcontractors is consequently seen as contributing significantly to a project's success. Although subcontractors are mainly selected by the main contractor, as one of the influential contributors to the project, the choice of subcontractor will also affect other project stakeholders such as owners and consultants. The goal of this study is to identify the factors that different project stakeholders consider important when selecting subcontractors, and the extent to which their professional background affects the way they view selection factors used for subcontractors. To this end a questionnaire was designed and distributed among construction industry experts in Alberta, Canada, from three groups of general contractors, owners, and consultants with various professional backgrounds. The survey results verified that the factors identified in the survey were in fact those that were considered in the selection of subcontractors. Based on statistical analysis of the survey results in most cases, respondents from the contractor group associated a different degree of importance to each selection factor compared with consultants and clients. The level of importance associated to each selection factor was found to be more similar among the latter two groups. Interestingly the lowest bid price was not necessarily ranked highest by professionals within all background groups.  1 INTRODUCTION A considerable portion of the work in construction projects is carried out by subcontractors. Consequently, selecting appropriate subcontractors contributes to a project's success (Hartmann et al. 2009). The literature around selection criteria has been mostly focused on choosing main contractors. These studies mainly focused on the selecting based on the low bidding price versus considering multi-criteria selection method.  A research study conducted in Singapore examined the relative importance of different factors in selecting a subcontractor by the main contractor. A survey was conducted to ask contractors which of the four factors of price, technical know-how, quality, and cooperation would affect their decision in selecting a subcontractor.  Professionals from 221 construction firms in Singapore responded to the survey. In order to find out if these criteria play an important role in selecting subcontractors, contractors were asked to rank the level of importance they associated to the four selection factors. Based on the survey results, contractors perceived all four factors important in selecting subcontractors. They were then asked to do a discrete choice experiment and express their preference based on a number of hypothetical scenarios.  335-1 Interestingly, the discrete choice survey results showed that price is a predominant basis for the choice decision. While low bidding price accounted for 50% of the contractor’s decision, a subcontractor’s attractiveness could be increased by the other three factors of quality of the work, its cooperation and technical know-how respectively. In addition, it was shown that under equal conditions, previous relationship with the main contractors could work to subcontractor’s advantage (Hartmann et al. 2009). A study in Pakistan examined the overall contractors’ satisfaction with the quality of services provided by subcontractors (Choudhry et al. 2012). A survey was conducted to investigate the extent and involvement of construction firms in subcontracting, reasons for subcontracting, and the selection criteria of subcontractors. The study found that the most widely used method for selecting a subcontractor was using a preference list that individual contractors prepared, generally based on the previous working experience with subcontractors. The second most common method was negotiation, while open bidding was the least preferred method. This study also found that out of five selection factors of price, quality, ability to complete work on time, subcontractors’ resources, and personal relationship, the most important criterion was the bid price, followed by the ability to complete the work on time and the quality of the work, respectively. Moreover, the study identified a high level of consistency in the opinions of the three groups (clients, consultants, and contractors) on the selection criteria of subcontractors (Choudhry et al. 2012). The objective of this study is to identify the factors that are deemed important in selecting subcontractors in Canada. The study will examine these factors not only from contractors’ perspective, but also from the perspective of experts from client and consultant organizations. This will enable a comparison of how experts at different roles in the industry view these selection factors.  2 METHODOLOGY With the objective of the study in mind, a survey questionnaire was designed, consisting of two parts: The first part of the questionnaire contained general questions to identify the respondents’ professional background, including the relevant industry sector and segment, and level of experience. This part included seven questions which were considered independent variables in the consequent statistical analysis. The second section consisted of the proposed subcontractors’ selection factors. Twelve factors were surveyed in this section. Respondents were requested to rank them on a scale of 1 to 5 as shown in Table 1 below. These factors were treated as dependent variables.  Table 1: Likert scale definition to express the level of importance for subcontractor selection factors  Scale 1 2 3 4 5 Definition Very Unimportant Unimportant Good to have Important Very Important The questionnaire was used to survey different professionals involved at various roles in the construction industry in Alberta, and the collected data was then statistically analyzed. A total number of 137 professionals from different walks of industry were surveyed. The participants were contacted through three modes of communications: in person (34.3% of responses), by email (62% of responses), and by regular mail (3.6% of responses). The following two sections provide summary of the survey results for the two parts of the questionnaire 3 SURVEY SUMMARY: DESCRIPTIVE STATISTICS 3.1 Part I: Professional Background   In the first part of the survey, participants were asked seven questions regarding their professional background. Below is the summary of their responses: Industry sector [P1]: 32.8% of the respondents were from the public sector and the remaining 67.2% from the private sector.  335-2 Role of the organization [P2]: 31.4% of the respondents worked for a client (owner) organization, 49.6% for contractors and 19% were from consulting firms. Construction segment [P3]: 13.9% of the participants were involved in projects related to the residential construction 18.3% in non-Residential construction, 26.3% in heavy infrastructure construction, and 65% in industrial construction. As it can be inferred from the distributions, some participants were active in more than one section.  Years of experience in the construction industry [P4]: 29.9% of the participants had less than 5 years of experience in the construction industry; 31.4% had between 5 to 10 years of experience and the remaining 38.7% had more than 10 years of experience. Years of experience in Alberta [P5]: 44.5% of the participants had less than 5 years of experience in Alberta’s construction industry; 32.8% had 5 to 10 years and 22.6% had more than 10 years of experience. A comparison of these percentages with those of the previous question can reflect the share of participants with larger years of experience in construction (more than 5 years) who have moved to Alberta.  Involvement in selecting subcontractors in projects [P6]:  About 60% of the respondents were involved in selecting subcontractors in less than 10 projects and the remaining 40% in more than 10 projects. Direct experience in working with subcontractors [P7]: 78.8% of the participants had experienced directly working with a subcontractor, and the remaining 21.2% lacked such experience. 3.2 Part II: Subcontractor Selection Criteria In the second part of the survey, the respondents were asked to rank the importance of twelve factors in the selection of subcontractors on a scale of 1 to 5 as shown in Table 1. Below are the results of the second part of the survey: Subcontractor’s experience in similar projects (F1): 0.7% ranked this factor very unimportant, 2.9% good to have, 38.7% important and 57.7% very important. Subcontractor’s familiarity with the local market (F2): 0.7% ranked this factor very unimportant, 9.5% unimportant, and 42.3% good to have, 34.3% important and 13.1% very important. Subcontractor bidding for the lowest price (F3): 10.2% considered this factor unimportant, 35.8% good to have, 24.1% important, and 29.9% very important. Compliance of the subcontractor’s submitted schedule with the project’s overall schedule (F4): 1.5% considered this factor very unimportant, 22.6% unimportant, 11.7% good to have, 33.6% important, and 30.7% very important. Subcontractor’s financial strength (F5): 23.4% ranked this factor very unimportant, 5.1% unimportant, 18.2% good to have, 36.5% important, and 16.8% very important. Subcontractor’s available resources (F6): 1.5% ranked this factor very unimportant, 2.9% unimportant, 8% good to have, 54% important, and 33.6% very important. Subcontractor’s reputation in the construction industry (F7): 2.9% considered it unimportant, 38% good to have, 39.4% important, and 19.7% very important. Presentation of a solid execution plan in subcontractor’s proposal (F8): 3.6% ranked this factor very unimportant, 15.3% unimportant, 29.9% good to have, 34.4% important, and 19.7 % very important. Subcontractor having a well-defined quality assurance and quality control (QA/QC) program (F9): 1.5% categorized this factor as very unimportant, 1.5% unimportant, 31.4% good to have, 41.6% important, and 24.1% very important. 335-3 Subcontractor’s past safety record and having a health and safety program (F10): 2.2% ranked this factor very unimportant in their selection, 7.3% unimportant, 27% good to have, 23.4% important, and 40.1% very important. Qualification of the key project personnel (F11): 5.1% ranked this factor very unimportant, 8% unimportant, 16.15% good to have, 45.3% important and 25.5% very important. Previous positive business relation with the subcontractor in other projects (F12): 3.6% considered it very unimportant, 15.3% unimportant, 33.6% good to have, 33.6% important and 13.9% very important. Figure 1 shows the mean score of rankings for the above twelve factors. It is interesting to note that the mean score for all the questioned criteria ranges from 3 to 4.5. This shows that the participants found all the identified factors relevant to the selection of subcontractors, and therefore, provide an indication that they were selected appropriately.    Figure 1:  Mean score of factors impacting the selection of subcontractors  4 ANALYSIS OF THE SURVEYED DATA  In order to examine the existence of significant relationships between the respondents’ professional background and how they ranked factors that affect the selection of subcontractors, a cross tabulated analysis of the survey data was carried out. Depending on the number of choices available to answer a question related to an independent variable, either t-test or ANOVA test were used. Whenever the number of choices in answering a question related to the professional background (independent variables) was limited to two mutually exclusive groups (e.g. P1-Industry Sector: Public or Private), t- test was applied to identify whether the difference in the answers of these two groups were statistically significant. For example, the average score that professionals from the two groups of Public and Private sectors (P1) gave to the importance of subcontractor’s experience on similar projects (F1) was 4.53 and 4.52, respectively. Therefore t-test was used to see if the 0.1 difference in their average scores is statistically meaningful or it was created by randomness. However, when the independent variable was composed of more than two mutually exclusive groups, (e.g. Role of respondent’s organization (P2): owners, contractors, or consultants), ANOVA test was applied to examine statistically significant difference between their opinions on a specific selection factor. If the result of the ANOVA test proved that there is significant difference, then the groups’ responses were compared two by two using the t-test to Mean Score Selection Factor 335-4 find out which group’s opinion was significantly different than the others. The statistical analysis was conducted using the statistical package for social science (SPSS). In total, 142 tests were conducted to examine the existence of significant relationships between the independent and dependent variables in the survey. At a 95% confidence level, 69 of the examined relationships were statistically significant. In other words, 5% possibility of type I error was accepted in this study which is what is commonly accepted in the similar studies (Winer 1971). Table 2 summarizes those relationships with P values less than 0.05. This section provides a brief explanation of the significant relationships organized based on the independent variables. Table 2: Relationships with statistical significance (P<0.05)  Dependent Variables Independent Variables F1     F2 F3 F4 F5 F6 F7 F8 F9 F1 F1 F12 Industry sector   .00 .00 .00   .00 .04 .00 .00 .00 Organization type  .00 .00 .00 .00  .00 .00  .00 .00 .00 Segment: Residential  .04 .04 .00 .00 .00  .00 .00 .01 .00 .01                   Non residential    .00 .00 .00   .00                      Heavy infrastructure   .01 .02 .00 .00     .01 .00 .01                  Industrial   .00 .00 .00 .00  .00 .00 .00 .00 .00 .00 Experience in construction  .00 .00 .00 .00  .00 .00  .01  .00 Experience in Alberta   .00 .00 .00   .01    .00 Involved in selecting sub.  .00 .02 .00 .00  .04 .00 .00 .02 .00  Working with subcontractor  .01 .01  .00   .00    .01 4.1 Industry Sector [P1] As it can be inferred from Table 3, the public and private sectors had different opinions about the importance of the most of factors influencing the selection of subcontractors. The mean values in Table 3 indicate that professionals from the public sector ranked schedule compliance (F4), financial strength (F5), execution plan (F8), QA/QC plan (F9), safety record (F10), qualification of the key project personnel (F11), and previous business relationship with subcontractor (F12) higher than those professionals from the private sector. On the other hand, professional from the private sector put higher importance for the low bidding price (F3) than their counterparts in the public sector.    4.2 Role of the Organization [P2] As shown in Table 4, this study could not find a correlation between the type of organization that the respondents worked and their ranking for the importance of subcontractors’ experience in similar projects (F1), available resources (F6), and safety reputation (F9). Professionals working in contractor organizations ranked the importance of lowest bid price higher (µ= 4.2) than those from clients and consultant organizations (µ= 3.28, µ=3.19, respectively). Those from owner organizations associated a higher importance to compliance to the schedule (F4), safety record of the subcontractor (F10), and qualification of the subcontractor personnel. Interestingly, professionals from the consultant firms associated a higher value to all the factors except for the lowest bidding price. In general, it appears that professionals from consultant and owner organizations associated closer importance to most of the factors compared to those from contractor organization (see average values in Table 4).  4.3 Construction Industry Segment [P3]  Since respondents could be involved in projects that belonged to more than one construction segment (Residential buildings, Non-residential buildings, Infrastructure, and Industrial projects), they could select more than one answer for this question (i.e. answers were not mutually exclusive). Therefore four separate t-tests were carried out to identify possible relationships between the involvement in each 335-5 industry segments and the ranking of the factors (Tables 5).  Professionals from the residential segment associated a high importance to almost all factors except for familiarity with the location market (F2) and lowest bid price (F3). Those involved in non-residential building construction found compliance of the subcontractor’s schedule with the project schedule (f4) and subcontractor’s execution plan (F8) were the most important factors. Professionals from heavy construction segment also found compliance to project schedule (F4) an important factor, along with subcontractor’s safety record (F10), and qualification of the personnel (F11). Those from industrial construction projects considered all factors as good to have. Table 3: Respondents’ industry sector and ranking of the factors impacting selection of the subcontractor  Factor Dependent variables Industry Sector Public Private Total N=45 N=92 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.53 0.786 4.52 0.544 0.10 135 0.920 F2 Familiarity with the local market 3.60 0.654 3.45 0.953 1.11 120 0.270 F3 Lowest price bid 3.27 0.780 3.97 1.021 -4.44 111 0.000 F4 Compliance of schedule 4.24 0.830 3.42 1.225 4.62 121 0.000 F5 Financial strength 3.87 0.726 2.85 1.547 5.24 135 0.000 F6 Available resources 4.27 0.809 4.10 0.799 1.16 135 0.249 F7 Reputation 3.91 0.668 3.68 0.851 1.70 108 0.093 F8 Execution plan 3.91 1.125 3.27 1.007 3.36 135 0.001 F9 QA & QC program 4.07 0.986 3.72 0.765 2.06 135 0.041 F10 Safety record 4.40 0.915 3.68 1.079 4.05 102 0.000 F11 Qualification of personnel 4.22 0.876 3.57 1.102 3.78 107 0.000 F12 Previous relationship 3.82 0.680 3.17 1.096 4.24 127 0.000  Table 4: Respondent’s organization role and ranking of the factors impacting selection of subcontractors   Factor Dependent variables Role of the organization Owner Contractor Consultant Total N=43 N=68 N=26 Df (2,134) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.53 0.797 4.50 0.533 4.58 0.578 0.15 0.865 F2 Familiarity with the local market 3.58 0.663 3.19 0.902 4.15 0.675 14.20 0.000 F3 Lowest price bid 3.28 0.797 4.24 0.932 3.19 0.894 21.88 0.000 F4 Compliance of schedule 4.21 0.861 3.12 1.223 4.38 0.571 22.84 0.000 F5 Financial strength 3.84 0.721 2.43 1.529 4.08 0.796 26.93 0.000 F6 Available resources 4.23 0.812 4.06 0.790 4.27 0.827 0.95 0.390 F7 Reputation 3.93 0.704 3.44 0.780 4.31 0.618 15.04 0.000 F8 Execution plan 3.86 1.146 3.04 0.953 4.00 0.849 13.08 0.000 F9 QA & QC program 4.00 1.000 3.71 0.774 4.00 0.748 2.07 0.131 F10 Safety record 4.42 0.906 3.43 1.041 4.38 0.852 17.58 0.000 F11 Qualification of personnel 4.14 0.941 3.35 1.103 4.31 0.736 12.77 0.000 F12 Previous relationship 3.74 0.690 2.91 1.000 4.04 0.960 19.00 0.000 335-6 Table 5: Respondent’s construction segment and factors impacting selection of the subcontractors  F Dependent variables Construction segment   Residential  Non-residential  Heavy    Industrial  N=19 N=25 N=36 N=89 Mean Sd. Sig. Mean Sd. Sig. Mean Sd. Sig. Mean Sd. Sig. F1 Experience-similar projects 4.74 0.4 0.049 4.64 0.9 0.318 4.58 0.8 0.5 4.51 0.5 0.6 F2 Familiarity w/local market 3.79 0.6 0.049 3.56 0.6 0.620 3.81 0.7 0.0 3.36 0.9 0.0 F3 Lowest price bid 3.05 0.8 0.001 3.24 0.7 0.002 3.42 0.9 0.0 3.93 1.0 0.0 F4 Compliance of schedule 4.47 0.6 0.000 4.20 0.9 0.006 4.14 1.0 0.0 3.42 1.2 0.0 F5 Financial strength 4.00 0.7 0.000 3.84 0.8 0.000 3.83 1.1 0.0 2.89 1.5 0.0 F6 Available resources 4.26 0.6 0.523 4.28 0.9 0.385 4.22 0.8 0.5 4.09 0.8 0.2 F7 Reputation 4.32 0.6 0.001 3.96 0.7 0.166 3.94 0.6 0.0 3.63 0.8 0.0 F8 Execution plan 4.11 0.8 0.007 4.00 0.9 0.006 3.67 1.2 0.2 3.30 1.0 0.0 F9 QA & QC program 4.32 0.7 0.011 3.88 0.9 0.867 4.00 1.0 0.2 3.70 0.7 0.0 F10 Safety record 4.47 0.7 0.004 4.28 0.9 0.064 4.28 0.9 0.0 3.69 1.0 0.0 F11 Qualification of personnel 4.37 0.7 0.010 3.96 1.0 0.360 4.22 0.8 0.0 3.53 1.1 0.0 F12 Previous relationship 3.79 0.9 0.060 3.56 0.8 0.350 3.72 0.8 0.0 3.18 1.0 0.0  4.4 Years of Experience in the Construction Industry [P4]    An interesting split was observed when studying the affect of years of experience on ranking the factors considered in selecting the subcontractors. As it can be seen in Table 6, respondents with low experience (less than 5 years) and those with high experience (more than 10 years) had a more similar opinion than those with medium experience (5 to 10 years). The latter group ranked the lowest bidding price (F3) higher than their counterparts with higher and lower years of experience (µ= 4.19 versus 3.43 and 3.66). Conversely, respondents with both less (less than 5 years) and higher experience (more than 10 years) associated higher level of importance on a good number of factors including the subcontractor’s familiarity  Table 6: Respondent’s years of experience in the construction industry and ranking of the factors impacting selection of the subcontractors    Factor Dependent variables Years of experience in construction industry <5 5-10 10 < Total N=41 N=43 N=53 DF (2,134 ) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.39 0.586 4.58 0.499 4.58 0.745 1.35 0.262 F2 Familiarity with the local market 3.76 0.860 3.16 0.871 3.57 0.797 5.53 0.005 F3 Lowest price bid 3.66 0.794 4.19 1.006 3.43 1.029 7.53 0.001 F4 Compliance of schedule 4.07 0.877 3.21 1.337 3.79 1.116 6.48 0.002 F5 Financial strength 3.68 0.960 2.35 1.526 3.47 1.339 13.11 0.000 F6 Available resources 4.17 0.834 4.07 0.828 4.21 0.769 0.36 0.699 F7 Reputation 3.85 0.792 3.44 0.700 3.94 0.818 5.40 0.006 F8 Execution plan 3.88 0.842 3.12 1.028 3.47 1.203 5.52 0.005 F9 QA & QC program 3.93 0.755 3.77 0.812 3.87 0.962 0.37 0.689 F10 Safety record 4.10 1.044 3.51 1.009 4.11 1.086 4.74 0.010 F11 Qualification of personnel 3.83 0.998 3.49 1.183 3.98 1.009 2.61 0.077 F12 Previous relationship 3.63 0.890 2.91 0.920 3.58 1.080 7.58 0.001 335-7 with the local market (F2),  schedule compliance (F4), financial strength (F5), reputation in the industry (F7), safety record (F10), previous business relationship (F12). The less experience professionals ranked having a well defined execution plan (F8) higher than those with more experience. The rest of the factors had the same level of importance for the surveyed professionals regardless their years of experience. 4.5 Years of Experience in Alberta [P5]  Similar to the years of experience in previous section, statistical analysis, as summarized in Table 7, revealed that respondents with less (less than 5 years) and those with higher experience (more than 10 years) in Alberta had a more similar opinion about the importance of factors than those with medium experience (5 to 10 years). The first two groups ranked subcontractor’s schedule compliance (F4), financial strength (F5), and pervious relationship (F12) higher than professionals with medium experience in Alberta (5 to 10 years). Similar to previous section, the latter group ranked the lowest bidding price higher than their counterparts with less and more experience in Alberta. Subcontractor’s execution plan (F8) was more important to respondents with less than 5 years experience in Alberta and the remaining selection factors had equal degree of importance for respondents from all three groups. Therefore, in general it appears that the experience in Alberta will not significantly change the ranking of factors compared to experience from other parts of the world. Table 7: Respondent’s years of experience in Alberta and ranking of the factors impacting selection of the subcontractors   Factor Dependent variables Years of experience in Alberta  < 5 5 - 10 10 < Total N=61 N=45 N=31 DF (2,134 ) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.48 0.566 4.53 0.548 4.61 0.844 0.49 0.614 F2 Familiarity with the local market 3.62 0.897 3.38 0.860 3.42 0.807 1.20 0.305 F3 Lowest price bid 3.64 0.932 4.09 0.973 3.42 1.057 4.89 0.009 F4 Compliance of schedule 3.95 1.056 3.22 1.241 3.87 1.118 5.84 0.004 F5 Financial strength 3.49 1.220 2.56 1.575 3.48 1.262 7.17 0.001 F6 Available resources 4.21 0.733 4.02 0.812 4.23 0.920 0.89 0.412 F7 Reputation 3.79 0.777 3.58 0.753 3.97 0.875 2.29 0.105 F8 Execution plan 3.75 0.830 3.16 1.186 3.42 1.259 4.19 0.017 F9 QA & QC program 3.93 0.772 3.84 0.796 3.71 1.071 0.71 0.492 F10 Safety record 3.98 1.057 3.73 1.074 4.06 1.124 1.06 0.349 F11 Qualification of personnel 3.80 1.030 3.56 1.119 4.06 1.063 2.11 0.125 F12 Previous relationship 3.56 0.87 2.98 1.06 3.65 1.11 5.81 0.004 4.6 Involvement in Selecting Subcontractors [P6] Professionals who were involved in selecting subcontractors in more than 10 projects ranked the importance of lowest bid price (F3) slightly higher (µ= 3.98) than those involved in selection of subcontractors in less than 10 projects (µ= 3.57). However, the rest of the factors received a higher score from professionals with less involvement in selecting subcontractors. Particularly in cases of compliance of schedule (F4) and financial strength (F5), the gap of opinions was considerable (Table 8).  4.7 Direct Experience in Working with Subcontractors [P7] Respondents’ without direct experience in working with a subcontractor put more importance on the subcontractor’s familiarity with the local market (F2), financial strength (F5), having a solid execution plan (F8) and a positive relationship than those with direct experience in working with subcontractor (Table 9). 335-8 Those with direct experience in working with subcontractor ranked the lowest bidding price (F3) higher. However, both groups had the same idea on the importance of the remaining selection factors. Table 8: Respondent’s involvement in selecting subcontractors in projects and ranking of the factors impacting selection of the subcontractors  Factor Dependent variables No. of projects involved in selecting subcontractors  < 10 > 10 Total N=82 N=55 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.51 0.689 4.55 0.538 -0.30 13 0.764 F2 Familiarity with the local market 3.66 0.820 3.25 0.886 2.74 13 0.007 F3 Lowest price bid 3.57 0.903 3.98 1.097 -2.29 10 0.024 F4 Compliance of schedule 4.02 1.088 3.20 1.129 4.28 13 0.000 F5 Financial strength 3.59 1.175 2.58 1.536 4.11 95 0.000 F6 Available resources 4.22 0.889 4.05 0.650 1.25 13 0.212 F7 Reputation 3.88 0.727 3.58 0.875 2.08 10 0.040 F8 Execution plan 3.73 1.007 3.11 1.100 3.42 13 0.001 F9 QA & QC program 4.02 0.816 3.60 0.852 2.93 13 0.004 F10 Safety record 4.09 1.102 3.67 1.001 2.23 13 0.028 F11 Qualification of personnel 3.99 0.988 3.47 1.136 2.74 10 0.007 F12 Previous relationship 3.52 0.959 3.18 1.090 1.94 13 0.060  Table 9: Respondent’s direct experience in working with subcontractors ranking of the factors impacting selection of the subcontractors  Factor Dependent variables Direct experience in working with subcontractors Yes No Total N=108 N=29 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.58 0.532 4.31 0.891 1.58 34 0.124 F2 Familiarity with the local market 3.40 0.842 3.86 0.875 -2.61 135 0.010 F3 Lowest price bid 3.84 1.015 3.34 0.857 2.42 135 0.017 F4 Compliance of schedule 3.61 1.191 4.00 1.069 -1.70 48 0.096 F5 Financial strength 3.04 1.497 3.72 0.882 -3.15 76 0.020 F6 Available resources 4.13 0.750 4.24 0.988 -0.66 135 0.508 F7 Reputation 3.72 0.807 3.90 0.772 -1.04 135 0.299 F8 Execution plan 3.32 1.075 4.07 0.923 -3.72 50 0.001 F9 QA & QC program 3.80 0.829 4.07 0.923 -1.54 135 0.127 F10 Safety record 3.83 1.072 4.24 1.057 -1.83 135 0.070 F11 Qualification of personnel 3.75 1.060 3.90 1.145 -0.65 135 0.517 F12 Previous relationship 3.27 1.038 3.83 1.258 -2.67 135 0.010 335-9 5 SUMMARY AND CONCLUDING REMARKS This study presented a survey of the factors that are deemed important when selecting subcontractors for construction projects. 137 construction industry professionals were surveyed. About two-thirds (67%) of the participants were from the private sector and the remaining from the public sector. The majority of participants were from contractor organizations, accounting for almost half of the population, followed by those from the owner organizations. Most of the participants were active in the industrial construction segments (64%), followed by the heavy infrastructure. While more than two thirds (70%) of the participants had above 5 years of experience in the construction industry, only slightly over half of the participants (55%) had more than five years of experience in Alberta. This gap can be reflective of the percentage of immigration of experienced professionals to this province. Around 40% of respondents were involved in selecting subcontractor in more than 10 projects and about 80% had direct experience in working with subcontractors, which may support the reliability of their responses.  Based on the survey result, the lowest bid price was the most important selection factor for participants from construction contractors and professionals with medium range (5-10 years) of experience in the construction industry in Alberta, those involved in selecting a subcontractor in more than 10 projects and with direct experience in working with subcontractors. Experience in similar projects was most important to professionals from residential segment. Familiarity with the local market was deemed most important by those from the consultant firms. Compliance to the project schedule was seen important by professionals from public sector, those from owner and consultant firms, those involved in residential segment, less than 5 years of experience in construction industry and involved in selecting subcontractors in less than 10 projects. Financial strength and reputation of subcontractor was scored highest by professionals from consultant firms and those involved in residential segment. Professionals from public sector, those with owner and consultant firms, those involved in residential segment, those with little experience in selecting subcontractors found the quality assurance program of subcontractors an important factor. Safety records and qualification of the personnel was scored highest by public sector, owner and consultant firms, residential and heavy segment, and those with little experience in selecting subcontractors. Interestingly, the consultants were the only group that associated a high important to the previous relationship with the subcontractor.  References  Banaitienė, N. and Banaitis, A. 2006. Analysis of Criteria for Contractors' Qualification Evaluation. Journal of Technological and Economic Development of Economy, XII(4): 276–282 Chiu, C., Hsu, M. and Wang, E. 2006. Understanding Knowledge Sharing In Virtual Communities: An Integration of Social Capital and Social Cognitive Theories. J. of Decision Support Syst., 42: 1872-1888 Choudhry, R., Hinze, J., Arshad, J., and Gabriel, H. 2012. Subcontracting Practices in the Construction Industry of Pakistan”. J. of Construction Engineering and Management, ASCE, 138(12): 1353-1359 Hartmann, A., Ling, F. and Tan, J. 2009. Relative Importance of Subcontractor Selection Criteria: Evidence from Singapore. J. of Construction Engineering and Management, ASCE, 135(9): 826–832 Ho, W., Xu. X. and Dey, P. 2010. Multi-Criteria Decision Making Approaches for Supplier Evaluation and Selection: A Literature Review, European Journal of Operational Research, 202(1): 16–24 Polit, D.F. 2010. Statistics and Data Analysis for Nursing Research. Pearson Education, NJ, USA. Winer B.J. 1971. Statistical Principles in Experimental Design. 2nd ed., McGraw Hill, New York, NY, USA.  335-10  5th International/11th Construction Specialty Conference 5e International/11e Conférence spécialisée sur la construction    Vancouver, British Columbia June 8 to June 10, 2015 / 8 juin au 10 juin 2015   FACTORS IMPACTING SELECTION OF CONSTRUCTION SUBCONTRACTORS Maryam Ghaffari Dolama1,2 and Farnaz Sadeghpour1  1 Department of Civil Engineering, University of Calgary, Calgary, Canada 2 maryam.ghaffaridolam@ucalgary.ca Abstract: A considerable portion of the work in construction projects is carried out by subcontractors. The current lowest bid practice, in which the main contractor offers a subcontract to the bidder who submits the lowest price, is considered to leave subcontractors with very low profit margins, and with a lack of motivation to provide high quality work. Selecting appropriate subcontractors is consequently seen as contributing significantly to a project's success. Although subcontractors are mainly selected by the main contractor, as one of the influential contributors to the project, the choice of subcontractor will also affect other project stakeholders such as owners and consultants. The goal of this study is to identify the factors that different project stakeholders consider important when selecting subcontractors, and the extent to which their professional background affects the way they view selection factors used for subcontractors. To this end a questionnaire was designed and distributed among construction industry experts in Alberta, Canada, from three groups of general contractors, owners, and consultants with various professional backgrounds. The survey results verified that the factors identified in the survey were in fact those that were considered in the selection of subcontractors. Based on statistical analysis of the survey results in most cases, respondents from the contractor group associated a different degree of importance to each selection factor compared with consultants and clients. The level of importance associated to each selection factor was found to be more similar among the latter two groups. Interestingly the lowest bid price was not necessarily ranked highest by professionals within all background groups.  1 INTRODUCTION A considerable portion of the work in construction projects is carried out by subcontractors. Consequently, selecting appropriate subcontractors contributes to a project's success (Hartmann et al. 2009). The literature around selection criteria has been mostly focused on choosing main contractors. These studies mainly focused on the selecting based on the low bidding price versus considering multi-criteria selection method.  A research study conducted in Singapore examined the relative importance of different factors in selecting a subcontractor by the main contractor. A survey was conducted to ask contractors which of the four factors of price, technical know-how, quality, and cooperation would affect their decision in selecting a subcontractor.  Professionals from 221 construction firms in Singapore responded to the survey. In order to find out if these criteria play an important role in selecting subcontractors, contractors were asked to rank the level of importance they associated to the four selection factors. Based on the survey results, contractors perceived all four factors important in selecting subcontractors. They were then asked to do a discrete choice experiment and express their preference based on a number of hypothetical scenarios.  335-1 Interestingly, the discrete choice survey results showed that price is a predominant basis for the choice decision. While low bidding price accounted for 50% of the contractor’s decision, a subcontractor’s attractiveness could be increased by the other three factors of quality of the work, its cooperation and technical know-how respectively. In addition, it was shown that under equal conditions, previous relationship with the main contractors could work to subcontractor’s advantage (Hartmann et al. 2009). A study in Pakistan examined the overall contractors’ satisfaction with the quality of services provided by subcontractors (Choudhry et al. 2012). A survey was conducted to investigate the extent and involvement of construction firms in subcontracting, reasons for subcontracting, and the selection criteria of subcontractors. The study found that the most widely used method for selecting a subcontractor was using a preference list that individual contractors prepared, generally based on the previous working experience with subcontractors. The second most common method was negotiation, while open bidding was the least preferred method. This study also found that out of five selection factors of price, quality, ability to complete work on time, subcontractors’ resources, and personal relationship, the most important criterion was the bid price, followed by the ability to complete the work on time and the quality of the work, respectively. Moreover, the study identified a high level of consistency in the opinions of the three groups (clients, consultants, and contractors) on the selection criteria of subcontractors (Choudhry et al. 2012). The objective of this study is to identify the factors that are deemed important in selecting subcontractors in Canada. The study will examine these factors not only from contractors’ perspective, but also from the perspective of experts from client and consultant organizations. This will enable a comparison of how experts at different roles in the industry view these selection factors.  2 METHODOLOGY With the objective of the study in mind, a survey questionnaire was designed, consisting of two parts: The first part of the questionnaire contained general questions to identify the respondents’ professional background, including the relevant industry sector and segment, and level of experience. This part included seven questions which were considered independent variables in the consequent statistical analysis. The second section consisted of the proposed subcontractors’ selection factors. Twelve factors were surveyed in this section. Respondents were requested to rank them on a scale of 1 to 5 as shown in Table 1 below. These factors were treated as dependent variables.  Table 1: Likert scale definition to express the level of importance for subcontractor selection factors  Scale 1 2 3 4 5 Definition Very Unimportant Unimportant Good to have Important Very Important The questionnaire was used to survey different professionals involved at various roles in the construction industry in Alberta, and the collected data was then statistically analyzed. A total number of 137 professionals from different walks of industry were surveyed. The participants were contacted through three modes of communications: in person (34.3% of responses), by email (62% of responses), and by regular mail (3.6% of responses). The following two sections provide summary of the survey results for the two parts of the questionnaire 3 SURVEY SUMMARY: DESCRIPTIVE STATISTICS 3.1 Part I: Professional Background   In the first part of the survey, participants were asked seven questions regarding their professional background. Below is the summary of their responses: Industry sector [P1]: 32.8% of the respondents were from the public sector and the remaining 67.2% from the private sector.  335-2 Role of the organization [P2]: 31.4% of the respondents worked for a client (owner) organization, 49.6% for contractors and 19% were from consulting firms. Construction segment [P3]: 13.9% of the participants were involved in projects related to the residential construction 18.3% in non-Residential construction, 26.3% in heavy infrastructure construction, and 65% in industrial construction. As it can be inferred from the distributions, some participants were active in more than one section.  Years of experience in the construction industry [P4]: 29.9% of the participants had less than 5 years of experience in the construction industry; 31.4% had between 5 to 10 years of experience and the remaining 38.7% had more than 10 years of experience. Years of experience in Alberta [P5]: 44.5% of the participants had less than 5 years of experience in Alberta’s construction industry; 32.8% had 5 to 10 years and 22.6% had more than 10 years of experience. A comparison of these percentages with those of the previous question can reflect the share of participants with larger years of experience in construction (more than 5 years) who have moved to Alberta.  Involvement in selecting subcontractors in projects [P6]:  About 60% of the respondents were involved in selecting subcontractors in less than 10 projects and the remaining 40% in more than 10 projects. Direct experience in working with subcontractors [P7]: 78.8% of the participants had experienced directly working with a subcontractor, and the remaining 21.2% lacked such experience. 3.2 Part II: Subcontractor Selection Criteria In the second part of the survey, the respondents were asked to rank the importance of twelve factors in the selection of subcontractors on a scale of 1 to 5 as shown in Table 1. Below are the results of the second part of the survey: Subcontractor’s experience in similar projects (F1): 0.7% ranked this factor very unimportant, 2.9% good to have, 38.7% important and 57.7% very important. Subcontractor’s familiarity with the local market (F2): 0.7% ranked this factor very unimportant, 9.5% unimportant, and 42.3% good to have, 34.3% important and 13.1% very important. Subcontractor bidding for the lowest price (F3): 10.2% considered this factor unimportant, 35.8% good to have, 24.1% important, and 29.9% very important. Compliance of the subcontractor’s submitted schedule with the project’s overall schedule (F4): 1.5% considered this factor very unimportant, 22.6% unimportant, 11.7% good to have, 33.6% important, and 30.7% very important. Subcontractor’s financial strength (F5): 23.4% ranked this factor very unimportant, 5.1% unimportant, 18.2% good to have, 36.5% important, and 16.8% very important. Subcontractor’s available resources (F6): 1.5% ranked this factor very unimportant, 2.9% unimportant, 8% good to have, 54% important, and 33.6% very important. Subcontractor’s reputation in the construction industry (F7): 2.9% considered it unimportant, 38% good to have, 39.4% important, and 19.7% very important. Presentation of a solid execution plan in subcontractor’s proposal (F8): 3.6% ranked this factor very unimportant, 15.3% unimportant, 29.9% good to have, 34.4% important, and 19.7 % very important. Subcontractor having a well-defined quality assurance and quality control (QA/QC) program (F9): 1.5% categorized this factor as very unimportant, 1.5% unimportant, 31.4% good to have, 41.6% important, and 24.1% very important. 335-3 Subcontractor’s past safety record and having a health and safety program (F10): 2.2% ranked this factor very unimportant in their selection, 7.3% unimportant, 27% good to have, 23.4% important, and 40.1% very important. Qualification of the key project personnel (F11): 5.1% ranked this factor very unimportant, 8% unimportant, 16.15% good to have, 45.3% important and 25.5% very important. Previous positive business relation with the subcontractor in other projects (F12): 3.6% considered it very unimportant, 15.3% unimportant, 33.6% good to have, 33.6% important and 13.9% very important. Figure 1 shows the mean score of rankings for the above twelve factors. It is interesting to note that the mean score for all the questioned criteria ranges from 3 to 4.5. This shows that the participants found all the identified factors relevant to the selection of subcontractors, and therefore, provide an indication that they were selected appropriately.    Figure 1:  Mean score of factors impacting the selection of subcontractors  4 ANALYSIS OF THE SURVEYED DATA  In order to examine the existence of significant relationships between the respondents’ professional background and how they ranked factors that affect the selection of subcontractors, a cross tabulated analysis of the survey data was carried out. Depending on the number of choices available to answer a question related to an independent variable, either t-test or ANOVA test were used. Whenever the number of choices in answering a question related to the professional background (independent variables) was limited to two mutually exclusive groups (e.g. P1-Industry Sector: Public or Private), t- test was applied to identify whether the difference in the answers of these two groups were statistically significant. For example, the average score that professionals from the two groups of Public and Private sectors (P1) gave to the importance of subcontractor’s experience on similar projects (F1) was 4.53 and 4.52, respectively. Therefore t-test was used to see if the 0.1 difference in their average scores is statistically meaningful or it was created by randomness. However, when the independent variable was composed of more than two mutually exclusive groups, (e.g. Role of respondent’s organization (P2): owners, contractors, or consultants), ANOVA test was applied to examine statistically significant difference between their opinions on a specific selection factor. If the result of the ANOVA test proved that there is significant difference, then the groups’ responses were compared two by two using the t-test to Mean Score Selection Factor 335-4 find out which group’s opinion was significantly different than the others. The statistical analysis was conducted using the statistical package for social science (SPSS). In total, 142 tests were conducted to examine the existence of significant relationships between the independent and dependent variables in the survey. At a 95% confidence level, 69 of the examined relationships were statistically significant. In other words, 5% possibility of type I error was accepted in this study which is what is commonly accepted in the similar studies (Winer 1971). Table 2 summarizes those relationships with P values less than 0.05. This section provides a brief explanation of the significant relationships organized based on the independent variables. Table 2: Relationships with statistical significance (P<0.05)  Dependent Variables Independent Variables F1     F2 F3 F4 F5 F6 F7 F8 F9 F1 F1 F12 Industry sector   .00 .00 .00   .00 .04 .00 .00 .00 Organization type  .00 .00 .00 .00  .00 .00  .00 .00 .00 Segment: Residential  .04 .04 .00 .00 .00  .00 .00 .01 .00 .01                   Non residential    .00 .00 .00   .00                      Heavy infrastructure   .01 .02 .00 .00     .01 .00 .01                  Industrial   .00 .00 .00 .00  .00 .00 .00 .00 .00 .00 Experience in construction  .00 .00 .00 .00  .00 .00  .01  .00 Experience in Alberta   .00 .00 .00   .01    .00 Involved in selecting sub.  .00 .02 .00 .00  .04 .00 .00 .02 .00  Working with subcontractor  .01 .01  .00   .00    .01 4.1 Industry Sector [P1] As it can be inferred from Table 3, the public and private sectors had different opinions about the importance of the most of factors influencing the selection of subcontractors. The mean values in Table 3 indicate that professionals from the public sector ranked schedule compliance (F4), financial strength (F5), execution plan (F8), QA/QC plan (F9), safety record (F10), qualification of the key project personnel (F11), and previous business relationship with subcontractor (F12) higher than those professionals from the private sector. On the other hand, professional from the private sector put higher importance for the low bidding price (F3) than their counterparts in the public sector.    4.2 Role of the Organization [P2] As shown in Table 4, this study could not find a correlation between the type of organization that the respondents worked and their ranking for the importance of subcontractors’ experience in similar projects (F1), available resources (F6), and safety reputation (F9). Professionals working in contractor organizations ranked the importance of lowest bid price higher (µ= 4.2) than those from clients and consultant organizations (µ= 3.28, µ=3.19, respectively). Those from owner organizations associated a higher importance to compliance to the schedule (F4), safety record of the subcontractor (F10), and qualification of the subcontractor personnel. Interestingly, professionals from the consultant firms associated a higher value to all the factors except for the lowest bidding price. In general, it appears that professionals from consultant and owner organizations associated closer importance to most of the factors compared to those from contractor organization (see average values in Table 4).  4.3 Construction Industry Segment [P3]  Since respondents could be involved in projects that belonged to more than one construction segment (Residential buildings, Non-residential buildings, Infrastructure, and Industrial projects), they could select more than one answer for this question (i.e. answers were not mutually exclusive). Therefore four separate t-tests were carried out to identify possible relationships between the involvement in each 335-5 industry segments and the ranking of the factors (Tables 5).  Professionals from the residential segment associated a high importance to almost all factors except for familiarity with the location market (F2) and lowest bid price (F3). Those involved in non-residential building construction found compliance of the subcontractor’s schedule with the project schedule (f4) and subcontractor’s execution plan (F8) were the most important factors. Professionals from heavy construction segment also found compliance to project schedule (F4) an important factor, along with subcontractor’s safety record (F10), and qualification of the personnel (F11). Those from industrial construction projects considered all factors as good to have. Table 3: Respondents’ industry sector and ranking of the factors impacting selection of the subcontractor  Factor Dependent variables Industry Sector Public Private Total N=45 N=92 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.53 0.786 4.52 0.544 0.10 135 0.920 F2 Familiarity with the local market 3.60 0.654 3.45 0.953 1.11 120 0.270 F3 Lowest price bid 3.27 0.780 3.97 1.021 -4.44 111 0.000 F4 Compliance of schedule 4.24 0.830 3.42 1.225 4.62 121 0.000 F5 Financial strength 3.87 0.726 2.85 1.547 5.24 135 0.000 F6 Available resources 4.27 0.809 4.10 0.799 1.16 135 0.249 F7 Reputation 3.91 0.668 3.68 0.851 1.70 108 0.093 F8 Execution plan 3.91 1.125 3.27 1.007 3.36 135 0.001 F9 QA & QC program 4.07 0.986 3.72 0.765 2.06 135 0.041 F10 Safety record 4.40 0.915 3.68 1.079 4.05 102 0.000 F11 Qualification of personnel 4.22 0.876 3.57 1.102 3.78 107 0.000 F12 Previous relationship 3.82 0.680 3.17 1.096 4.24 127 0.000  Table 4: Respondent’s organization role and ranking of the factors impacting selection of subcontractors   Factor Dependent variables Role of the organization Owner Contractor Consultant Total N=43 N=68 N=26 Df (2,134) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.53 0.797 4.50 0.533 4.58 0.578 0.15 0.865 F2 Familiarity with the local market 3.58 0.663 3.19 0.902 4.15 0.675 14.20 0.000 F3 Lowest price bid 3.28 0.797 4.24 0.932 3.19 0.894 21.88 0.000 F4 Compliance of schedule 4.21 0.861 3.12 1.223 4.38 0.571 22.84 0.000 F5 Financial strength 3.84 0.721 2.43 1.529 4.08 0.796 26.93 0.000 F6 Available resources 4.23 0.812 4.06 0.790 4.27 0.827 0.95 0.390 F7 Reputation 3.93 0.704 3.44 0.780 4.31 0.618 15.04 0.000 F8 Execution plan 3.86 1.146 3.04 0.953 4.00 0.849 13.08 0.000 F9 QA & QC program 4.00 1.000 3.71 0.774 4.00 0.748 2.07 0.131 F10 Safety record 4.42 0.906 3.43 1.041 4.38 0.852 17.58 0.000 F11 Qualification of personnel 4.14 0.941 3.35 1.103 4.31 0.736 12.77 0.000 F12 Previous relationship 3.74 0.690 2.91 1.000 4.04 0.960 19.00 0.000 335-6 Table 5: Respondent’s construction segment and factors impacting selection of the subcontractors  F Dependent variables Construction segment   Residential  Non-residential  Heavy    Industrial  N=19 N=25 N=36 N=89 Mean Sd. Sig. Mean Sd. Sig. Mean Sd. Sig. Mean Sd. Sig. F1 Experience-similar projects 4.74 0.4 0.049 4.64 0.9 0.318 4.58 0.8 0.5 4.51 0.5 0.6 F2 Familiarity w/local market 3.79 0.6 0.049 3.56 0.6 0.620 3.81 0.7 0.0 3.36 0.9 0.0 F3 Lowest price bid 3.05 0.8 0.001 3.24 0.7 0.002 3.42 0.9 0.0 3.93 1.0 0.0 F4 Compliance of schedule 4.47 0.6 0.000 4.20 0.9 0.006 4.14 1.0 0.0 3.42 1.2 0.0 F5 Financial strength 4.00 0.7 0.000 3.84 0.8 0.000 3.83 1.1 0.0 2.89 1.5 0.0 F6 Available resources 4.26 0.6 0.523 4.28 0.9 0.385 4.22 0.8 0.5 4.09 0.8 0.2 F7 Reputation 4.32 0.6 0.001 3.96 0.7 0.166 3.94 0.6 0.0 3.63 0.8 0.0 F8 Execution plan 4.11 0.8 0.007 4.00 0.9 0.006 3.67 1.2 0.2 3.30 1.0 0.0 F9 QA & QC program 4.32 0.7 0.011 3.88 0.9 0.867 4.00 1.0 0.2 3.70 0.7 0.0 F10 Safety record 4.47 0.7 0.004 4.28 0.9 0.064 4.28 0.9 0.0 3.69 1.0 0.0 F11 Qualification of personnel 4.37 0.7 0.010 3.96 1.0 0.360 4.22 0.8 0.0 3.53 1.1 0.0 F12 Previous relationship 3.79 0.9 0.060 3.56 0.8 0.350 3.72 0.8 0.0 3.18 1.0 0.0  4.4 Years of Experience in the Construction Industry [P4]    An interesting split was observed when studying the affect of years of experience on ranking the factors considered in selecting the subcontractors. As it can be seen in Table 6, respondents with low experience (less than 5 years) and those with high experience (more than 10 years) had a more similar opinion than those with medium experience (5 to 10 years). The latter group ranked the lowest bidding price (F3) higher than their counterparts with higher and lower years of experience (µ= 4.19 versus 3.43 and 3.66). Conversely, respondents with both less (less than 5 years) and higher experience (more than 10 years) associated higher level of importance on a good number of factors including the subcontractor’s familiarity  Table 6: Respondent’s years of experience in the construction industry and ranking of the factors impacting selection of the subcontractors    Factor Dependent variables Years of experience in construction industry <5 5-10 10 < Total N=41 N=43 N=53 DF (2,134 ) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.39 0.586 4.58 0.499 4.58 0.745 1.35 0.262 F2 Familiarity with the local market 3.76 0.860 3.16 0.871 3.57 0.797 5.53 0.005 F3 Lowest price bid 3.66 0.794 4.19 1.006 3.43 1.029 7.53 0.001 F4 Compliance of schedule 4.07 0.877 3.21 1.337 3.79 1.116 6.48 0.002 F5 Financial strength 3.68 0.960 2.35 1.526 3.47 1.339 13.11 0.000 F6 Available resources 4.17 0.834 4.07 0.828 4.21 0.769 0.36 0.699 F7 Reputation 3.85 0.792 3.44 0.700 3.94 0.818 5.40 0.006 F8 Execution plan 3.88 0.842 3.12 1.028 3.47 1.203 5.52 0.005 F9 QA & QC program 3.93 0.755 3.77 0.812 3.87 0.962 0.37 0.689 F10 Safety record 4.10 1.044 3.51 1.009 4.11 1.086 4.74 0.010 F11 Qualification of personnel 3.83 0.998 3.49 1.183 3.98 1.009 2.61 0.077 F12 Previous relationship 3.63 0.890 2.91 0.920 3.58 1.080 7.58 0.001 335-7 with the local market (F2),  schedule compliance (F4), financial strength (F5), reputation in the industry (F7), safety record (F10), previous business relationship (F12). The less experience professionals ranked having a well defined execution plan (F8) higher than those with more experience. The rest of the factors had the same level of importance for the surveyed professionals regardless their years of experience. 4.5 Years of Experience in Alberta [P5]  Similar to the years of experience in previous section, statistical analysis, as summarized in Table 7, revealed that respondents with less (less than 5 years) and those with higher experience (more than 10 years) in Alberta had a more similar opinion about the importance of factors than those with medium experience (5 to 10 years). The first two groups ranked subcontractor’s schedule compliance (F4), financial strength (F5), and pervious relationship (F12) higher than professionals with medium experience in Alberta (5 to 10 years). Similar to previous section, the latter group ranked the lowest bidding price higher than their counterparts with less and more experience in Alberta. Subcontractor’s execution plan (F8) was more important to respondents with less than 5 years experience in Alberta and the remaining selection factors had equal degree of importance for respondents from all three groups. Therefore, in general it appears that the experience in Alberta will not significantly change the ranking of factors compared to experience from other parts of the world. Table 7: Respondent’s years of experience in Alberta and ranking of the factors impacting selection of the subcontractors   Factor Dependent variables Years of experience in Alberta  < 5 5 - 10 10 < Total N=61 N=45 N=31 DF (2,134 ) Mean Sd. Mean Sd. Mean Sd. F Sig. F1 Experience in similar projects 4.48 0.566 4.53 0.548 4.61 0.844 0.49 0.614 F2 Familiarity with the local market 3.62 0.897 3.38 0.860 3.42 0.807 1.20 0.305 F3 Lowest price bid 3.64 0.932 4.09 0.973 3.42 1.057 4.89 0.009 F4 Compliance of schedule 3.95 1.056 3.22 1.241 3.87 1.118 5.84 0.004 F5 Financial strength 3.49 1.220 2.56 1.575 3.48 1.262 7.17 0.001 F6 Available resources 4.21 0.733 4.02 0.812 4.23 0.920 0.89 0.412 F7 Reputation 3.79 0.777 3.58 0.753 3.97 0.875 2.29 0.105 F8 Execution plan 3.75 0.830 3.16 1.186 3.42 1.259 4.19 0.017 F9 QA & QC program 3.93 0.772 3.84 0.796 3.71 1.071 0.71 0.492 F10 Safety record 3.98 1.057 3.73 1.074 4.06 1.124 1.06 0.349 F11 Qualification of personnel 3.80 1.030 3.56 1.119 4.06 1.063 2.11 0.125 F12 Previous relationship 3.56 0.87 2.98 1.06 3.65 1.11 5.81 0.004 4.6 Involvement in Selecting Subcontractors [P6] Professionals who were involved in selecting subcontractors in more than 10 projects ranked the importance of lowest bid price (F3) slightly higher (µ= 3.98) than those involved in selection of subcontractors in less than 10 projects (µ= 3.57). However, the rest of the factors received a higher score from professionals with less involvement in selecting subcontractors. Particularly in cases of compliance of schedule (F4) and financial strength (F5), the gap of opinions was considerable (Table 8).  4.7 Direct Experience in Working with Subcontractors [P7] Respondents’ without direct experience in working with a subcontractor put more importance on the subcontractor’s familiarity with the local market (F2), financial strength (F5), having a solid execution plan (F8) and a positive relationship than those with direct experience in working with subcontractor (Table 9). 335-8 Those with direct experience in working with subcontractor ranked the lowest bidding price (F3) higher. However, both groups had the same idea on the importance of the remaining selection factors. Table 8: Respondent’s involvement in selecting subcontractors in projects and ranking of the factors impacting selection of the subcontractors  Factor Dependent variables No. of projects involved in selecting subcontractors  < 10 > 10 Total N=82 N=55 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.51 0.689 4.55 0.538 -0.30 13 0.764 F2 Familiarity with the local market 3.66 0.820 3.25 0.886 2.74 13 0.007 F3 Lowest price bid 3.57 0.903 3.98 1.097 -2.29 10 0.024 F4 Compliance of schedule 4.02 1.088 3.20 1.129 4.28 13 0.000 F5 Financial strength 3.59 1.175 2.58 1.536 4.11 95 0.000 F6 Available resources 4.22 0.889 4.05 0.650 1.25 13 0.212 F7 Reputation 3.88 0.727 3.58 0.875 2.08 10 0.040 F8 Execution plan 3.73 1.007 3.11 1.100 3.42 13 0.001 F9 QA & QC program 4.02 0.816 3.60 0.852 2.93 13 0.004 F10 Safety record 4.09 1.102 3.67 1.001 2.23 13 0.028 F11 Qualification of personnel 3.99 0.988 3.47 1.136 2.74 10 0.007 F12 Previous relationship 3.52 0.959 3.18 1.090 1.94 13 0.060  Table 9: Respondent’s direct experience in working with subcontractors ranking of the factors impacting selection of the subcontractors  Factor Dependent variables Direct experience in working with subcontractors Yes No Total N=108 N=29 N=137 Mean Sd. Mean Sd. T Df Sig. F1 Experience in similar projects 4.58 0.532 4.31 0.891 1.58 34 0.124 F2 Familiarity with the local market 3.40 0.842 3.86 0.875 -2.61 135 0.010 F3 Lowest price bid 3.84 1.015 3.34 0.857 2.42 135 0.017 F4 Compliance of schedule 3.61 1.191 4.00 1.069 -1.70 48 0.096 F5 Financial strength 3.04 1.497 3.72 0.882 -3.15 76 0.020 F6 Available resources 4.13 0.750 4.24 0.988 -0.66 135 0.508 F7 Reputation 3.72 0.807 3.90 0.772 -1.04 135 0.299 F8 Execution plan 3.32 1.075 4.07 0.923 -3.72 50 0.001 F9 QA & QC program 3.80 0.829 4.07 0.923 -1.54 135 0.127 F10 Safety record 3.83 1.072 4.24 1.057 -1.83 135 0.070 F11 Qualification of personnel 3.75 1.060 3.90 1.145 -0.65 135 0.517 F12 Previous relationship 3.27 1.038 3.83 1.258 -2.67 135 0.010 335-9 5 SUMMARY AND CONCLUDING REMARKS This study presented a survey of the factors that are deemed important when selecting subcontractors for construction projects. 137 construction industry professionals were surveyed. About two-thirds (67%) of the participants were from the private sector and the remaining from the public sector. The majority of participants were from contractor organizations, accounting for almost half of the population, followed by those from the owner organizations. Most of the participants were active in the industrial construction segments (64%), followed by the heavy infrastructure. While more than two thirds (70%) of the participants had above 5 years of experience in the construction industry, only slightly over half of the participants (55%) had more than five years of experience in Alberta. This gap can be reflective of the percentage of immigration of experienced professionals to this province. Around 40% of respondents were involved in selecting subcontractor in more than 10 projects and about 80% had direct experience in working with subcontractors, which may support the reliability of their responses.  Based on the survey result, the lowest bid price was the most important selection factor for participants from construction contractors and professionals with medium range (5-10 years) of experience in the construction industry in Alberta, those involved in selecting a subcontractor in more than 10 projects and with direct experience in working with subcontractors. Experience in similar projects was most important to professionals from residential segment. Familiarity with the local market was deemed most important by those from the consultant firms. Compliance to the project schedule was seen important by professionals from public sector, those from owner and consultant firms, those involved in residential segment, less than 5 years of experience in construction industry and involved in selecting subcontractors in less than 10 projects. Financial strength and reputation of subcontractor was scored highest by professionals from consultant firms and those involved in residential segment. Professionals from public sector, those with owner and consultant firms, those involved in residential segment, those with little experience in selecting subcontractors found the quality assurance program of subcontractors an important factor. Safety records and qualification of the personnel was scored highest by public sector, owner and consultant firms, residential and heavy segment, and those with little experience in selecting subcontractors. Interestingly, the consultants were the only group that associated a high important to the previous relationship with the subcontractor.  References  Banaitienė, N. and Banaitis, A. 2006. Analysis of Criteria for Contractors' Qualification Evaluation. Journal of Technological and Economic Development of Economy, XII(4): 276–282 Chiu, C., Hsu, M. and Wang, E. 2006. Understanding Knowledge Sharing In Virtual Communities: An Integration of Social Capital and Social Cognitive Theories. J. of Decision Support Syst., 42: 1872-1888 Choudhry, R., Hinze, J., Arshad, J., and Gabriel, H. 2012. Subcontracting Practices in the Construction Industry of Pakistan”. J. of Construction Engineering and Management, ASCE, 138(12): 1353-1359 Hartmann, A., Ling, F. and Tan, J. 2009. Relative Importance of Subcontractor Selection Criteria: Evidence from Singapore. J. of Construction Engineering and Management, ASCE, 135(9): 826–832 Ho, W., Xu. X. and Dey, P. 2010. Multi-Criteria Decision Making Approaches for Supplier Evaluation and Selection: A Literature Review, European Journal of Operational Research, 202(1): 16–24 Polit, D.F. 2010. Statistics and Data Analysis for Nursing Research. Pearson Education, NJ, USA. Winer B.J. 1971. Statistical Principles in Experimental Design. 2nd ed., McGraw Hill, New York, NY, USA.  335-10  1 Factors Impacting Selection of Construction Subcontractors Maryam Ghaffari Dolama Supervisor: Dr.Farnaz Sadeghpour 2 Background and Problem Statement Ø Subcontractors do  a considerable portion of  construction work Ø Selecting appropriate subcontractors contributes to a project's success (Hartmann et al. 2009). Ø Choice of subcontractor affect other project stakeholders  (owners & consultants)	  3 Objective Ø  Identify subcontractor selection factors important for construction professionals Ø  Influence of professional background on importance associated with the factors 4 Methodology Ø  Survey questionnaire Ø  137 experts (Alberta) Ø                                            Ø  Data analysis & Statistical tests Owners Consultants General contractors (34.3%) (62%) (3.6%) t-test ANOVA & post hoc Selection factors 5 Survey questionnaire Professional background Selection factors Scale 1 2 3 4 5 Definition Very  Unimportant Unimportant Good  to have Important Very Important Likert scale definition  6 Survey questionnaire Independent variables Industry sector Organization type Experience in construction Experience in Alberta Involve selecting subcontractor Working with subcontractor Independent variables Experience in similar projects Local market familiarity Schedule compliance Available resources  Reputation in market Execution plan QA  / QC program Safety record  Previous relationship private public 32.8% 67.2% 7 49.6% owner 31.4% 19.0% contractor Organization type Industry sector consultant Survey summary 8 Construction segment 26.3% industrial residential 13.9% 65.0% non-residential infrastructure 18.3% Survey summary 9 Experience in Alberta 22.6% > 10 years 32.8% <5 years 5-10 years 44.5% Survey summary 31.4% Experience in construction > 10 years 5< years 5-10 years 38.7% 29.9% 60% 78.8% 10 Working experience  with subcontractor 21.2% No direct work experience direct work experience Survey summary Involved in selecting subcontractor >10 project <=10 projects 40% 11 Mean score of factors impacting the selection of subcon. 1 2 3 4 5 Mean Score Selection Factor Descriptive statistics 12 Number of choices in Professional background 2 > 2 t- test ANOVA & ad hoc Inferential statistics Examining statistically significant relations between professional background and selection factor  13 t- test Inferential statistics Industry sector   Public Private Owners Consultants General contractors Low bid price ANOVA & ad hoc Organization type Low bid price 14 Inferential statistics Independent   variables  experience in similar proj.  local market familiarity  lowest price bid  schedule compliance  financial strength  available resources  reputation  execution plan  QA  / QC program  safety record  qualification of personnel  previous relationship  Industry sector  Prv.  Pub.  Pub.  Pub.  Pub.  Pub.  Pub.  Pub.  Organization type  Cs.  Con.  Own Cs.  Cs.  Cs.  Own  Cs.  Cs.  Experience in construc.  5-10  >10 <5  >10 <5  >10 <5  >10 <5  <5  >10 <5  >10 <5  Experience in Alberta 5-10  >10 <5  >10 <5  5-10  >10 <5  Involve selecting sub. <10  >10  <10  <10  <10  <10  <10  <10  <10  Working with sub.  N.D.  D.  N.D.  N.D.  N.D.  14 Inferential statistics Independent   variables  experience in similar proj.  local market familiarity  lowest price bid  schedule compliance  financial strength  available resources  reputation  execution plan  QA  / QC program  safety record  qualification of personnel  previous relationship  Residential  .049 .049 .001 .000 .000 .001 .007 .011 .004 .010 Non residential  .002 .006 .000 .006 Infrastructure  .012 .025 .005 .000 .012 .004 .012 Industrial  .006 .002 .000 .000 .004 .008 .003 .000 .000 .000 16 Conclusion Low bid price valued more by the following professionals •  Private sector  •  Construction contractor segment •  5-10 years of experience in Alberta’s construction industry •  Selecting subcontractor in more than 10 project •  Have direct working experience with subcontractor 

Cite

Citation Scheme:

        

Citations by CSL (citeproc-js)

Usage Statistics

Share

Embed

Customize your widget with the following options, then copy and paste the code below into the HTML of your page to embed this item in your website.
                        
                            <div id="ubcOpenCollectionsWidgetDisplay">
                            <script id="ubcOpenCollectionsWidget"
                            src="{[{embed.src}]}"
                            data-item="{[{embed.item}]}"
                            data-collection="{[{embed.collection}]}"
                            data-metadata="{[{embed.showMetadata}]}"
                            data-width="{[{embed.width}]}"
                            async >
                            </script>
                            </div>
                        
                    
IIIF logo Our image viewer uses the IIIF 2.0 standard. To load this item in other compatible viewers, use this url:
http://iiif.library.ubc.ca/presentation/dsp.52660.1-0076446/manifest

Comment

Related Items