An Example Based-Approach to Elucidating the Tendering Process

As you learn more and more about the business world, you’ll come across the various layers of abstraction that laymen don’t see. You’ll notice how intricate the simple process of hiring a new employee is. When companies single out applications, they don’t just weigh the accomplishments of the candidate. They assess whether he or she has the cultural framework to be an asset for the company or not. In other words, companies view prospective employees as prospective assets. You need to be a complete package to outmaneuver the holistic selection protocols native to hiring processes. Now, the workforce is merely one entity among the many different building blocks of a business. Think about the procedures governing partnerships between entire organizations. When a company needs a product or a service that it can’t create internally, it reaches the outer world for help. Now, this help doesn’t magically appear in front of the company’s doorstep. A complicated and time-tested mechanism called the tendering process makes this happen. For the sake of simplicity, you can think of a tender as a job listing in the classified section of a newspaper. However, there’s a lot underneath the surface that you wouldn’t see with a single glance. For instance, it is a given that a procurement procedure signifies a need for external help. But, it also signifies the acceptable standards of completion for the task at hand. Furthermore, you can’t even apply for the tender if you don’t satisfy certain criteria. This increased number of checks and balances makes sense. After all, winning a tender means winning a contract to serve a function for an organization. It facilitates the emergence of synergy between two separate workforces. It is much more complex than a job listing. Much more is at stake here. However, the underlying principles of both processes have many things in common. The cultural framework of a tenderer has the same significance that the cultural framework of a prospective employee has.

How tendering plays out in real-time

Over the years, the tendering process has evolved into an entirely new animal. The stage-based segregation that is inherent to the traditional way of tendering manifests itself differently in e-procurement tenders. The first and foremost goal of any kind of procurement is to single out the most suitable tenderer by the process of elimination. Such processes can vary in ideologies, but all of them share a score-based pattern. All the tenderers that participate in the tendering process are evaluated against several factors. Based on the factors of evaluation, a score is allotted to each participant. The highest scorer emerges victorious, and quite obviously, the victor takes all the spoils. Companies are mostly required to be transparent about their selection protocols. Losing tenderers are even debriefed on how they didn’t measure up to the expected standards. This transparent nature of the procurement process serves the buyer and the vendor equally. The buyer can solicit the best bang for the buck, and the seller can get valuable critical feedback, if not a new business.

Here’s a step-by-step breakdown of the whole ordeal:-

1. Internal Dialogue about Project Scope- Before advertising tenders, or even writing them out, companies carry out formal discussions on the scope of the project that requires tendering. All stakeholders linked with the project are united under one agenda. Such discussions define key components like the expected standards of project completion, rules for dissolution of a contract, draft contract, evaluation methodology, and more.

2. Writing the Tender:- As the scope of the project gains a concrete form, it warrants the initiation of the second step in the tendering process. Upon realizing the goals and outcomes of a tender, such details are given a formatted existence. In other words, the components extracted in the initial discussions are written down according to a stringent format. Such formats are usually internationally accepted ways of writing tenders down. The document created at the end of this process is typically called the Request to Tender.

3. Advertising the Tender:-If you register your tender with an online procurement system, the need for advertising is significantly mitigated. However, if you choose to spread the word about your tender via traditional means, print media can be a great advertising platform. Previously garnered acclaim for your company’s ease-of-doing-business can also fetch you marketing via word-of-mouth. Furthermore, if you choose to engage the tendering process for a pre-selected pool of applicants, the spend on advertising dips to a great extent.

4. Shortlisting and Evaluating Bids: –The Request to Tender released in the previous stage of the process will shortlist all the bids that don’t violate the rules mentioned in the document. Evaluation is easier in e-procurement tenders as you can view all applications simultaneously in a single platform. However, the attention to detail achieved in the traditional evaluation process involving detailed paperwork and heavy manual intervention cannot be replaced by an online procurement system.

Once these 4 steps are completed, the tendering process ends with the signing of a contract. Last-minute negotiations are not uncommon to the tendering process. However, the extent to which such changes impact the backbone of the tender is usually small. Once the relevant parties enter a contract, the tender turns into a legally enforceable business partnership. If the rules of engagement are violated by the party performing the deed mentioned in the tender, the conflict can be remedied using the appropriate legal intervention.

Conclusion

To conclude, let’s come back to the example we started with. At the end of a recruitment process, the employer finds a candidate best suited to the advertised role. Similarly, at the end of the tendering process, a company finds a vendor/service-provider best suited to deliver the required service or goods. In spirit, the tendering process is a mirror to the recruitment process. However, the scale of both these operations is vastly dissimilar. 

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