It has become common for clients to send bidders so much data that nobody has the time to produce tenders properly. Now there’s a campaign to change all that
Tendering for work is a link in the procurement chain that binds the construction industry together: it’s a key link, but not without weaknesses. At best, tendering encourages competition and helps keep costs under control. At worst, it can lead to mistakes, waste and inflated prices.
Now there’s a campaign – called Information Overload – to improve the tendering process, initiated by the specialist contractors that bear the brunt of the faults in the system. But don’t think you’re immune: this is a problem that affects the whole industry, including our clients. We need your support to solve it before it gets any worse.
Information and time are at the heart of the problem – far too much of one, much of which is irrelevant, and not nearly enough of the other, which is needed to prepare tenders. Contractors are routinely issued with CDs containing all the project documentation. This vast package has to be sorted and assessed by each recipient. Often the only practical starting point is to print out everything, which can mean outputting 1,000 drawings to find the 30 or so that are relevant.
This “quantity” problem is relatively new. A few years ago, when invitations to tender were issued on paper, documentation provided just essential data. The quantity problem also reflects the industry’s attitude to managing risk. Sending everything to everyone shifts responsibility from issuer to receiver. This might seem to offer advantages to whoever issues the tender, but is it really the best way to manage overall project risk?
The quantity problem also means that specialists sometimes have just a few days to produce complicated tenders. The information overload affects us at every level. The principal subcontractors want tenders from their specialist sub-subcontractors within the deadlines they’ve been allowed. Four or five building services contractors will seek tenders for building controls, lighting, boiler, chiller, pipework, ductwork, pumps and fans, and may well ask five or six suppliers of each specialist system to provide quotations. These sub-subcontractors then need to seek component prices from their own suppliers.
The eight to 12 weeks that might have been allowed for the main contractor to prepare a tender turns into a seven-to-10-day deadline by the time the request for quotation reaches the specialist sub-subcontractor.
The combination of the quantity and timing problems has several effects, none desirable:
Often the only practical starting point for a contractor is to print out everything, which can mean outputting 1,000 drawings to find the 30 or so that are relevant
- Contractors each have to sort the data, so there’s more wasted effort as firms duplicate the printing and analysis of information
- Unnecessary pressure is put on the whole supply chain, which has insufficient time to sort and analyse the information.
This can lead to:
- The high probability of a vital piece of information being overlooked
- Errors in understanding and in pricing
- Increased overhead costs for the tenderer
- Artificially inflated prices as tenderers try to manage their own risks.
All the above comes at a cost, which is either absorbed by the supply chain or paid by the client. There must be a better way!
There are some relevant standards such as BS 1192 and ISO 13567, but few seem to know of their existence and even fewer follow them.
Options might include:
- Developing integrated teams and partnerships to eliminate over-tendering
- Extra funding from the client to cover the cost of tendering, or allowing claims for additional costs from the tier above
- Asking each tier to extract the relevant information before cascading it down.
Eliminating information overload will require fresh ideas from across the industry. We’d like to hear your thoughts on how best to tackle the problem.
Cedric Sloan is director general of the Association of Ductwork Contractors and Allied Services