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78 CHAPTER 4 Conclusions and Suggested Research 4.1 Conclusions the selection process. The final products of this research include the following: Based on the findings and critical evaluation, some con- clusions are made as follows: 1. A common definition and a conceptual framework for the use of best-value procurement methods for highway con- The literature, case study findings, and survey results indi- struction projects. cate that many different approaches have been used for 2. A baseline of projects and performance results against best-value parameters and criteria, rating systems, and which performance outcomes for best-value highway award algorithms for construction projects. All of these projects will be measured. approaches need to be carefully evaluated and considered 3. A best-value procurement system that allows for flexibil- for applicability to a traditional procurement process. ity in the choice of parameters and award methods. The use of best-value procurement in the highway indus- 4. An implementation plan that includes a project screening try was limited to a relatively small number of projects-- system for selecting candidate projects and a step-by-step 25 potential case studies were identified and many of these process for selecting appropriate parameters, criteria, and were design-build projects. The most frequently used selec- award algorithms. tion strategies were meets technical criteria--low bid or 5. Strategies regarding developing legislation and procure- A+B bidding, which suggests that the best-value selection ment regulations for best-value procurement. strategies adopted by highway agencies were more closely 6. A model best-value specification to be used as a template aligned with the low-bid system. for development of detailed specifications. Initial performance results indicate that projects procured 7. A compendium of case studies for best-value procurement using the best-value method perform as well or better than in the highway construction industry. traditional design-bid-build projects based on common performance measures. Finally, the research team has recommended, as part of a A best-value procurement system, particularly for an long-term implementation strategy, that selected agencies agency considering its use for the first time, should be flex- champion the use of best-value procurement for pilot proj- ible in terms of parameters chosen and evaluation system ects and use selected performance metrics to evaluate the used, adapting to the needs of the specific project rather results compared with similar projects using the traditional than using one approach for all highway construction low-bid only procurement. projects. 4.2 Suggested Research In summary, a best-value system that is flexible in the selec- tion of parameters and criteria, rating systems, and award The research in this study provides a practical implemen- algorithms will have the greatest likelihood to be successfully tation guide that is firmly based in best practices of public implemented in the context of a traditional low-bid system. sector best-value procurement. However, the U.S. highway For success of implementation, the project screening system construction industry has relatively little experience with will ensure that best value is applied to projects that will real- non-traditional procurement. Some of the best practices ize a significant benefit from the use of additional factors in from this study are derived from best-value procurement in

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79 federal and state building sectors and international experi- AASHTO best-value guide specifications for Highway ence with best-value concepts where the system is more Construction. The guide specifications will promote stan- mature. The primary need for future research involves meas- dard and consistent implementation of best-value pro- urement and refinement of the best-value system in U.S. curement throughout the country. highway construction. The research team suggests the follow- Create project selection criteria that are based on historic ing topics be considered at the national and state levels: data specifically from highway projects. Due to the small number of best-value highway projects, the project selec- Conduct pilot studies to test the proposed best-value system. tion criteria developed in this report had to be based on Each agency should test best-value procurement and meas- user judgment rather than statistically significant correla- ure its effectiveness within the agency. Pilot projects are an tions to project characteristics. The selection system guides appropriate avenue for further refinement and testing of the users to an informed decision using their own judgment process. The research component of these pilots involves the rather than reliance on past performance data as originally design for measurement metrics and testing procedures. proposed. It is possible that different users from the same Measure the performance of highway best-value projects highway agency will select different projects for best-value on a national level and determine the cost, schedule, or procurement from the project selection criteria contained quality implications of the system. Agencies need data to in this report. As more best-value projects are completed in make good decisions. A long-term national study on the the highway sector, more project performance data will effectiveness of best-value procurement will allow agencies become available and more objective project selection to make more informed decisions concerning the appro- models can be developed. priateness of its use. Develop national or state baseline metrics for individual Much more research in best-value procurement is needed evaluation criteria. Many of the individual best-value pro- if the highway industry expects to change from the low-bid curement criteria would benefit from data pertaining to processes that are currently in use in the industry. This baseline measurement metrics. Past performance is an research is needed on a longitudinal basis so that the impli- obvious candidate for historic baseline data, but personnel cations of its use can be measured objectively and accu- experience, life-cycle costs, and other criteria would bene- rately. The framework provided in this report provides a fit from historic databases for comparison as well. consistent model for the application of best-value procure- Prepare a User's Implementation Guide to Best-Value Pro- ment. This model allows for more significant research to be curement based on the results of this research and develop done in the future.