Lowest Bidder? No Wonder There Are Problems
Dr. Deming always preached to not choose suppliers based on price alone. Many companies and industries have never learned that lesson, so why should we expect governments to do any better?
This Marketplace story highlights how manyroad construction or improvement projects are beset with delays. The systemic culprit? Policies that mandate choosing the lowest bidder. Marketplace explains:
“Thousands of roads and bridges across the country are in this predicament. In Massachusetts alone, 43 percent of the road and highway projects under construction aren't finished on time.”
The low bidders often don't have the resources to get the job done, or they won't go above and beyond to finish a job that might not be very profitable.
Another systemic dysfunction that's highlighted in the story is the practice of beginning work before the design is finalized and has been signed off on by the contractor. This, not surprisingly, leads to rework and additional delays. The governmental body is just chucking the design “over the wall” to the contractor.
Is there any hope that we can get government to focus on being effective instead of just focusing on trying to be cheap?