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Development of Reusable Bid Evaluation Models for the Portuguese Electric Transmission Company

CEG-IST, Centre for Management Studies of IST, Technical University of Lisbon, 1049-001 Lisbon, Portugal, and Department of Management—Operational Research Group, London School of Economics, London WC2A 2AE, United Kingdom
CEG-IST, Centre for Management Studies of IST, Technical University of Lisbon, 1049-001 Lisbon, Portugal
Graduate School of Business, University of Chicago, Chicago, Illinois 60637
BANA Consulting, Lda., R. Prof. Bento Jesus Caraça, 33, 1600-600 Lisbon, Portugal
carlosbana{at}ist.utl.pt
c.bana{at}lse.ac.uk
joao.lourenco{at}ist.utl.pt
MChagas{at}chicagogsb.edu
joao{at}bana-consulting.pt

Bid evaluation is the process of selecting a contractor from a number of bidders. The decision analysis models currently in use at the Portuguese Electric Transmission Company (REN) to evaluate bids were developed through a decision-conferencing process supported by the MACBETH multicriteria approach and software. This paper presents the various components of this interactive sociotechnical process. Given the number of contracts awarded by REN each year, it was crucial that the models be reusable in similar calls for tenders; this required substantial care in structuring the criteria, with a focus on constructed scales, and building value function models based on qualitative pairwise comparison judgments of difference in attractiveness. Also of particular interest is the approach for weighing benefits against costs.

Key Words: bid evaluation; constructed scales; decision conferencing; MACBETH; model structuring; multicriteria weighting
History: Received on July 20, 2007. Accepted on December 21, 2007.

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