The traditional paper based process of receiving bids from contractors for construction projects has proven itself fertile ground for claims and litigation. The people responsible for managing the bidding process attempt to eliminate the potential for problems by using strict protocols and processes. Why then are there still so many claims, delays and lawsuits that arise from this phase of a project? I suggest it is the complexity and manual nature of the process that creates the risk of problems. If we examine how to deal with some of the common issues that arise, a clear and obvious solution emerges.
Eliminate delays and gaps in the flow of information
All bidders need to be treated the same with no preference or advantage given to any of them. Having one easily accessible common source for all project documents and information that is equally accessible by all bidders eliminates the potential for errors or omissions in distributing them. Complaints like “I did not receive that Addendum” are eliminated.
Eliminate the fax from your amendment process
Allowing bids to be amended via fax has become a common practice. Physical problems like jammed paper feeds, delayed transmissions, busy signals, wrong numbers often result in late or incomplete bids. The ideal bid submission is one that contains all the required information in the prescribed format with no amendment required. This also eliminates the potential for errors or omissions arising from the need to receive the amendments, record the time received, match the correct amendment with the correct bid and then perform the calculations required to incorporate them.
Eliminate the ability of bidders to miss mandatory requirements
Non-compliant bids are a constant source of challenges. It may be that a relatively minor (or major for that matter) clerical error by a bidder of a mandatory requirement could be the cause of rejection for what would otherwise have been a competitive bid. Lawyers have spent countless hours drafting clauses that provide an owner with discretion in the errors or omissions that they choose to overlook or declare insignificant. That hasn’t stopped bidders and the courts from looking deeper into the issue of fundamental fairness of process resulting in expensive legal action and in many cases expensive conclusions.
Eliminate the potential for errors in tracking bidder activity
It is essential to accurately know who received what information and when it was received. Tracking and recording this information completely and accurately relies on the diligence of the persons managing the bidding process. In the event of a claim or legal action this information has to be produced to prove that no errors or omissions were made.
Eliminate the need to synchronize clocks
The bid closing time is a critical milestone in the bidding process. Many legal actions have arisen to dispute various aspects of when a bid call actually closes. Language like “up to”, “at”, “on or before” a specified time are used to describe the same thing which is the instant in time that the bids must be received by. Whose clock is used to determine the time? What if the clock used has the incorrect time? All fodder for the courts. The ideal situation is one where the bidders and the bid recipient are all working off of the exact same clock with the exact same understanding of when the closing time is.
Eliminate the separation of the bond submission from the bid submission
In an attempt to create a more efficient process some owners permit the bid to be submitted separately from the bid bond. This creates an administrative requirement on the part of the bid recipient to accurately record the reception of both documents and then match them appropriately to the bid. In circumstances where the bond is misplaced, received via fax or is received late there is the ever present risk of legal action or other problems. The bond and the bid should always be received as one submission.
Eliminate manual transposition of bid results
Evaluating and comparing bids requires some form of organization or tabulation. Doing this manually introduces the risk of errors or omissions in the transposition of the bid results which can cause expensive evaluation errors or create the risk of legal action. Automatically receiving the results in a fully tabulated format eliminates the problem and makes it easy to provide bidders with the results of the process.
A quick search of the court records in virtually any jurisdiction will reveal the extent to which problems and legal action arise from competitive bidding practices. Even the most skilled and diligent administrators can end up dealing with issues that are not of their making. There is a new option available for bid administrators that addresses every one of the issues discussed here. It is the advent of our online bid submission technology specifically designed for the procurement of construction services. Using this technology provides these benefits:
- One easily accessible common source for all project documents and information that is equally accessible by all bidders
- All bids submitted contain all the required information in the prescribed format with no amendment required.
- No ability for bidders to submit non-compliant bids arising from incomplete submissions
- An automated audit trail that automatically records all relevant activities relating to the bid documents and the bid submission
- The bidders and the bid recipient are all working off of the exact same clock with the exact same understanding of when the closing time is
- The bond and the bid are always received as one submission.
- All bid results are automatically received in the identical format and the results are available individually or in an automatically tabulated format
Making use of this new technology eliminates many of the challenges inherent in the bidding process for construction services while reducing the risk of errors and legal action.