Ideal Construction Procurement System based on Transaction Cost Approach
Journal Title: International Journal of Academic Research in Business and Social Sciences - Year 2018, Vol 8, Issue 1
Abstract
Procurement system provides an avenue for bringing together various service providers in a construction project, and for identifying and fulfilling the priority needs of the client for procuring the building or facility. Thus, it is critical that by making the right choice of a procurement system at the onset would indirectly ensure successful project delivery with satisfaction by all parties involved. There have been many attempts made to develop various model to assist in the decision making and selection of appropriate procurement system and most of the models are developed based on clients’ objectives and preferences and influenced by the project constraints. However, none of the previously established models give detail consideration on the cost aspects especially the hidden cost apart from the production cost. Therefore, the Transaction Cost Theory is appropriate to be applied in every phase of construction project and most importantly the application of this theory can become the basis of the clients in selecting the most ideal procurement system to be adopted for their construction projects. Unfortunately, Transaction Cost Theory is unknown and the awareness on application of Transaction Cost Theory in construction project among the industry players is very minimal. In fact, in Malaysian context, so far there is limited study done to relate the Transaction Cost Theory to any aspect of construction fields. The purpose of this research is to identify the common transaction cost incurred in different types of procurement system i.e. Traditional and Design and Build; to develop a framework in selecting the ideal procurement system based on the Transaction Cost Theory approach. Investigations would be limited to the views expressed by professional consultants in Malaysia. Structured questionnaires and expert interview will be conducted as data collection methods. Content analysis, multi-attribute analysis and rank correlation test will be used in the analysis of the data.
Authors and Affiliations
Wan Norizan Wan Ismail, Siti Sarah Mat Isa, Norhafizah Yusop
Keywords
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- EP ID EP530311
- DOI 10.6007/IJARBSS/v8-i1/388
- Views 88
- Downloads 0
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