Traditional low-bid procurement system versus performance information procurement system (pips) in construction industry

The past decade has brought about a lot of changes in the construction industry. But the low bid system has remained the most popular procurement system. Many users have documented the poor performance and poor quality of contractors that have been procured using the low-bid. The low bid process is a price-based environment. Research testing has shown that performance may be increased in moving to a performance based environment. A survey was conducted to collect data on delivery systems falling under both the price-based environment and the performance based environment from testers of a performance based system named PIPS. This data was used to statistically compare the performance of both these systems, namely PIPS, a performance based system, and low bid, a price based system. Results from the two-sample t-test gave indications of better results for the performance-based system than the price based system.