PhD Final Thesis April 2013.pdf - Anglia Ruskin Research Online

Thesis Keith Gale 2013to an alternative incentive mechanism, this information is also deduced from a tenderreport.8.12 Calculation of financial production values in this researchFor financial assessment of the 120 selected projects the following definitions,sources of data and calculations are used within the construct:Tender totalThe value of a tender submitted by a supplier, checked and corrected for arithmeticerrors by a quantity surveyor and included in the organisations tender report.Pre-tender estimateThe estimated value of a project at tender stage prepared by a quantity surveyor andincluded as a value in organisation reports.Variance between tender total and estimateThe difference between ‘tender total’ and ‘pre-tender estimate’ where a = tendervalue and b = estimate value. If a/b = < 1, then the lowest tender is below theestimate. If a/b = > 1, then the lowest tender has exceeded the estimate.Lowest tender totalThe value of a lowest tender submitted by a supplier, checked and corrected forarithmetic errors by a quantity surveyor and included in the organisations tenderreport.Variance between lowest tender total and accepted tenderA difference between ‘lowest tender total’ and an accepted tender by a client. This isdesigned to represent the additional costs with use of financial incentive values. Thelowest corrected tender will always be selected with discrete procurement methodsbut if some suppliers are ahead of others in terms of performance for frameworkprojects, a performance adjustment factor may be applied. The client will accept aslightly higher tender if performance metrics for past projects show goodperformance. Values for discrete projects will therefore always be 1.000 whereas183