Fuzzy Multiplicative Analytic Hierarchy Process (FMAHP) Approach for Outsourcing Government Projects A Case Study of the Rural Development Department of the Government of Orissa

In recent times, single-attribute procurement auctions based on price alone have given way to multi-attribute procurement auctions for sourcing of works and services. In this paper, we propose a model to find the most favorable contractor in a multi-attribute competitive bidding process. The model not only considers the relevant details submitted in the tender document but also the past performance of contractors. Based on the survey, we select a set of nine important attributes for competitive bidding and categorize them into two clusters— present tender document, and past performance index. We use the Fuzzy Multiplicative- AHP approach (FMAHP) to solve the problem of contractor selection for awarding of project. Five of the selected attributes deal with the past work details of the contractor. After collecting those past records, we conduct an FMAHP to calculate the performance index of each contractor. Then we use these performance index values in further calculation to determine the winner of the procurement auction using present tender documents. To explain the model, we take an example of the government of Orissa’s Rural Development Department.