Effect of tender evaluation process on performance of public construction projects

Using a Tanzanian case, this study examined the effect of the tender evaluation process on the performance of public construction projects. The survey strategy was applied to collect data from 205 members of user departments from the Institute of Accountancy Arusha. The data analysis technique was performed using partial least squares structural equation modelling with the help of Smart PLS 4 software. The findings disclosed that the technical examination and financial examination of tenders are significantly associated with the performance of public construction projects. Though most previous studies paid attention to contract execution attributes, this study suggests that tender evaluation attributes are also required to attain the best performance in public construction projects. Theoretically, the results demonstrate that the shortcomings in the technical and financial examination of tenders may cause adverse selection, moral hazard signalling, and ultimately inadequate project performance.