Uncertainties Prevailing in Construction Bid Documents and Their Impact on Project Pricing through the Analysis of Prebid Requests for Information

Abstract

Construction bid documents may contain uncertain or incomplete information that can affect project pricing as well as project performance, if not addressed prior to bidding. To resolve the uncertainties and clarify project requirements, the risk and uncertainties prevailing in the document should be identified at an early stage of the project life cycle. In this study, pre-bid request for information (RFI) is utilized as a key clue to quantify project ambiguities and uncertainties of a bid document, as pre-bid RFI is generated by bidders when any ambiguous or incomplete information is encountered in the bid document. Despite the significance of pre-bid RFI in quantifying project uncertainty, studies considering pre-bid RFI to identify project uncertainty are limited. Driven by document-based analysis, this study aims to investigate what uncertainties are frequently encountered in bid documents and how they affect project pricing. To achieve the research goal, this study will (1) identify the prevailing risks/uncertainties in the bid document; (2) determine the most common risks/uncertainties and their impacts on bid price; and (3) verify the significance of pre-bid RFIs in bid uncertainty prediction models. To achieve these objectives, public project data from US state Departments of Transportation (DOTs) were collected and used for frequency analysis, correlation testing, and machine learning-based prediction models. The results of uncertainty prediction models showed that uncertainties driven by pre-bid RFI analysis can improve the project risk prediction up to 15%, verifying the significance of RFIs in the bid price prediction model. This study will contribute to the construction management body of knowledge by clarifying the likelihood of errors and uncertainties that should be checked before bidding, thereby proactively preventing future design changes, claims, and dispute risks.