J-SELARAS: A NEW INNOVATION MODEL FOR RATE RATIONALISATION IN CONTRACT DOCUMENTS

Abstract

Effective rate rationalisation plays a crucial role in modifying tender rates to determine equitable and rational contract amounts, particularly within the context of the construction industry in Malaysia, to ensure that contractor prices do not exhibit any front-loading tendencies and establish equitable pricing for variations. Despite the importance of rate rationalisation, the Malaysian construction industry grapples with various challenges in the domains of tendering and estimating. These challenges include the scarcity of precise historical data, project intricacy, time limitations, cost variations, restricted technology integration, and the competitive dynamics within the bidding environment. This study introduces an innovative rationalisation model that utilises the Z-Score Altman model to address these challenges. This model aims to fine-tune the data and establish justifiable rates.

Moreover, reasonable rates can be determined through meticulous data integration. Data integration, a widely accepted technique, facilitates smooth data conversion and sharing across diverse applications with different database formats and locations. The proposed model incorporates dynamic algorithms that systematically transfer data between application systems, accommodating various data formats, whether structured or unstructured. Integrating the Z-Score algorithm within the model efficiently filters out extraneous data within the Excel single-sheet file. This algorithm rapidly transfers data to multiple Excel sheets using the macro formulation, recognising minimum and maximum values, calculating modified means, and employing cut-off analysis to narrow down the most favourable rates. This research rigorously evaluates rates by successful tenderers, staying within established parameters and providing a durable algorithm that outlines the calculations and conditions guiding this thorough evaluation.