The implications of programmatic working on bid/no-bid decisions of contractors

Contractors increasingly have to reconsider the trade-off process in bid/no-bid decisions for tenders, due to changing procurement practices of public clients. Whereas public clients used to procure single projects, a shift is observed towards the procurement of programmes. Since programmes pose different characteristics than projects, project-oriented bid/no-bid practices have to adapt accordingly. So far, however, little knowledge is available on the trade-offs made during the bid/no-bid decision of programmatic tenders in the construction industry. This explorative study focusses on the trade-offs made in the bid/no-bid decision of programmatic tenders and its implications for current project-oriented bid/no-bid practices. Data is collected by conducting interviews, observations and document analysis. Results reveal that there is a focus on business benefits and ecosystem considerations rather than the ability of executing projects in terms of experience and resources, because of the project uncertainty during the bid/no-bid decision of programmes. This has implications for current bid/no-bid practices of contractors, and their underlying processes, and the way public clients put programmes on the market. Further research is recommended into the consequences of changing procurement policy of public clients on contractors’ organizations, their governance, and business models in place.