Cost-Plus Contractor Selection: A Case Study

by James E. Diekmann, (M.ASCE), Asst. Prof.; Dept. of Civ., Environmental, and Architectural Engrg., Univ. of Colorado, Boulder, Colo. 80309,

Serial Information: Journal of the Technical Councils of ASCE, 1981, Vol. 107, Issue 1, Pg. 13-25

Document Type: Journal Paper


A method for quantifying and measuring the effectiveness of contractors competing for a cost-plus contract has been developed. The methodology is demonstrated within the context of a $40,000,000 cost-plus incentive fee contract for electrical work on a nuclear power station. Four candidate contractors are evaluated and ranked using a multicriterion decision model. Comparisons are made between the decision model rankings and those arrived at by more traditional means. The procedure demonstrates the viability of a quantitative approach to a heretofore qualitative problem. Although not accomplished here, the procedure may be adapted to the selection of fixed price contractors as well.

Subject Headings: Case studies | Contractors and subcontractors | Electric power | Power plants | Fees | Nuclear power | Comparative studies | Pricing

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