Multi-criteria decision-making model for EPC contractor prequalification: a hybrid approach

Abstract

Purpose Nowadays, engineering, procurement and construction (EPC) contracts are being widely used to perform industrial and infrastructure projects because of several reasons like high speed of implementation. However, these contracts are always accompanied by high risks and uncertainties. Thus, selection of the right EPC contractor has significant importance. This paper aims to present a fuzzy multi-criteria decision-making (MCDM) model for EPC contractor prequalification. Design/methodology/approach First, the EPC contractor prequalification criteria are defined by using literature review and interviewing experts. Second, the weights of criteria are determined by interviewing experts. Then, each EPC contractor is evaluated in each criterion. Finally, fuzzy weighted average (FWA) approach is employed to select the right contractor among potential EPC contractors. Findings The proposed model is prepared as an applicable model for clients to select the right EPC contractors among contractors who want to conduct the project. Originality/value As a lack of applicable model does exist to assign the prequalification of EPC contractors, this study is one of the first research studies which proposed a fuzzy MCDM model for evaluation of EPC contractors. To cope with the uncertainty of the prequalification problem, fuzzy logic has been used. Using fuzzy sets leads to reaching more reliable results. Also, a real case study is provided to explain the proposed model.

Ranked generic criteria for EPC contractor selection

“…Amiri et al.’s (2021) list is more similar to our results, with “financial resources”, “management and technical ability”, “time performance”, “experience”, “personnel”, “quality” and “health and safety” being a close match. However, our two main criteria of “past performance” and “project understanding” are missing, with the accent instead being on “historical non-performance”.…”

“…These results contrast with the only two known similar studies by Transmar Consult Inc. and (2003) and Amiri et al (2021). In the case of the former's 2005 list reproduced in Table 1, the top ten criteria in each are roughly matched with 'past performance', 'technical', 'key personnel', 'past experience', 'management', and 'quality'.…”

“…The remaining 11 criteria of "past experience", "time", "management", "financial", "contractual and legal", "quality", "cost", "relationships", "environmental and sustainability", "organisational" and "industrial relations" are rated as "important" and also need to be included. These results contrast with the only two known similar studies by Transmar Consult Inc. ( 2003) and Amiri et al (2021). In the case of the former's 2005 list reproduced in Table 1, the top 10 criteria in each are roughly matched with "past performance", "technical", "key personnel", "past experience", "management" and "quality".…”

“…Niayeshnia et al's (2020) study of the classification, prioritization, efficiency, and change management of EPC projects, for instance, while identifying the (mainly negative) influences on productivity, does not focus specifically on contractor selection. Only Amiri et al (2021) have determined a weighted set of criteria. This is as part of their EPC contractor selection model with selection criteria (based on Holt et al's (1994b) general construction criteria) for an individual project by interviewing seven experts who are "members of evaluation team of employers", to be subsequently rated for importance by the members of the commissioning team of the employer.…”

“…’s (2020) study of the classification, prioritization, efficiency and change management of EPC projects, for instance, while identifying the (mainly negative) influences on productivity, does not focus specifically on contractor selection. Only Amiri et al. (2021) have determined a weighted set of criteria.…”