Dos
and Don't For E-Tendering; A Quantity Surveying Perspective
(By Eugene Seah, Davis Langdon & Seah Singapore Pte Ltd)
Synopsis
The process and
legal principles of tendering is part of the everyday life of a
Quantity Surveyor (QS). However, with the advancement of
technologies, these processes may change. Such advancement has
brought E-Tendering into the equation of procurement. E-
Tendering, in its essence, does provides the QS with
productivity enhancing capabilities. However, if managed in a
wrongful manner, it will cause much grievances to both the
consultants and the tenderers. This paper looks at the
approaches of E-Tendering, the inputs and considerations that
QSs (both the consultant and contractor) should take note off
and lastly, discusses the use of Electronic Interchange
Agreements that sets the protocols of handling information.
General
With the heighten use of technologies, processes in any industry
will change and has changed. The construction industry of
Singapore has been radically changed by the use of Information
Technology (IT) in almost all aspects in the construction
process. Examples to cited are the usage of Web based
collaboration tools and E-tendering.
The process of
tendering is well understood by Quantity Surveyors (QSs). This
process has been ingrained in the QS training almost by hard.
However, with the coming of E-tendering, the question is will
the traditional QS process for tendering still relevant? Would
there be additional considerations that is both contractual and
essential to effectively facilitate E-tendering? This paper
discusses the general considerations for e-tendering and are
only meant as a best practice and are non-exhaustive.
Before
proceeding with the object of this paper, the author would like
to highlight the concept of E-tendering in general. In
Singapore, the E-tendering concept is part of the entire
paradigm of CORENET, which stands for Construction and Real
Estate Network. Aimed at improving the over productivity,
efficiency and efficacy of the construction industry of
Singapore, CORENET is a government initiative that encourages
private and public participation by the various players in the
construction industry. The object of E-tendering is to
specifically increase the productivity of during the tendering
process, decrease paper handling and speed up communication and
interaction.
These
E-tendering tools usually come in the form of web-based
platforms, which are governed by construction exchange portals.
Usually nicknamed as Tender Engines, the tender process, which
is originally performed manually, is transformed to E-processes
and performed over the internet. Bills of Quantities and Work
Package breakdowns are uploaded into the tender engine. In some
portals which operates on the Construction Industry Firm
Electrically (CITE ) format, the tenderer can input the rates
and/or quantities in the engine which easily processes the
information into intelligent and useful data for the consultant
QS to evaluate and report.
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This entire
relationship can be illustrated in Figure 1 below.
Figure 1 (Courtesy of DLS)
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It is usual for the
tender engines to have the facility for the contractor to upload
documents. This is usually in the case for Design and Build tenders
whereby the tenderer can upload the Contractor’s Proposal. Some
advanced tender engines will even contain an E-market place whereby
the Main Contractors may enter this e-domain to obtain quotations
from other subcontractors, suppliers and specialist contractors
sharing this domain.
Once the quotations
are obtained, the main contractor may select the cost effective
quote to be compiled in the tender engine for submission. In
addition, such tender engines will also have a security procedure
and management system in place (e.g. private/ public key systems,
key pair systems and firewalls) to ensure authenticity and security
of the entire tendering process. (See Figure 2)
Figure 2
(Courtesy of DLS)
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Contractual
Issues
The author would like to cover four essential contractual issues to
be considered by a Consultant QS. These four issues centre on mainly
the conditions of tendering/ instructions to tenderers, the form of
tender, tender submission input by consultants and considerations
for the preliminaries
- Conditions of
Tendering/ Instructions to Tenderers
The conditions of
tendering will contain salient clauses that govern the rules of
tendering prior to the formation of contract between the Employer
and Contractor. If this process is going to be incorporated into the
E-tendering process, traditional clauses may not be applicable.
The following is
recommended to be included for consideration in the conditions of
tendering.
- Highlight the main contents in
the tender document in the tender engine.
- Inform the contractor to
counter check the documents that have been uploaded into the
tender engine.
- Stipulate the tender querying
period that is to be carried out on-line and cut off date of
such period.
- Instruct the tenderers to
table out the documents and drawings submitted where there are
alternative designs or proposals made. This will enable the
consultant QS to check if all documents have been uploaded
successfully into the tender engine. There are instances
whereby documents are not fully loaded due to the lapse or
time-out of due to slow uploading speed. Information to
consider will include but not limited to
|
|
 |
| ii. File name |
| iii. File description |
| iv. Version number |
| v. No of Pages in
document |
| vi. Approximate memory
size of file |
- Instructions to assist
tenderers to obtain the digital certificates (usually from
government or privately designated third party vendors) needed
to clear the security for submission
- Reminders to tenderers to
top-up credit accounts for e-payment purposes (if a payment
engine is used for clearing of on-line payment).
It is unwise to leave the conditions
of tendering and the specific instructions to navigate within the
tender engine and its submission process ambiguous. Generally, the
level of IT adoption in the Construction Industry of Singapore is
generally low since 1999 thus it cannot be assumed that the
e-tendering process is well understood by the participating
contractors.
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The form of tender
is another important contractual document that warrants attention by
both the consultant QS and the contractor QS. In Singapore, there
are many forms of contract, ranging from the Singapore Institute of
Architect’s (SIA) form to the Public Sector Standard Conditions of
Contract (PSSCOC). The latter, being a government standard contract,
has a standard form pertaining to the form of tender but the former
leaves it to the consultant QS to draft its conditions. The
consultant QS would have to consider how to amend the form so that
the submitted e-form would still be contractually binding. And, the
contractor QS would have to be extra prudent in its submission as
certain private form of tenders would have clauses to say that the
figures (written) in the form of tender would supersede that of the
final summary if there is a discrepancy between the two. Some
recommendations are:
- Instructions to the tenders to
fill in the form of tender in the tender engine
- Instruction and checks in
filling the form of tender including the endorsement of the
form with the contractor’s digital certificate
- Clauses to indicate that in
the event of discrepancies, the amount written in words will
prevail
- Clauses to include that until
a formal contract is drawn, the tender (with the
contractor’s written agreement in the form of tender
including the contractors digital certificate stamp) shall be
binding.
- Tender Submissions
considerations, consultant’s input
It is common that
e-tender engineers work in conjunction with web based collaboration
tools. This celebrates the effectiveness of concurrent engineering
with the productivity of tendering all as one. However, even though
design information can be coordinated during the design develop
stage, design consultants can get carried away in the number of
revisions in the drawings or not even recording the revisions. Thus
it is preferable that a e-tender manager or coordinate is appointed
for coordinating the uploading of the tender documents. This task
usually falls on the laps of the consultant QS. The following are
considerations as best practice :
- Elect one consultant to
coordinate the input of the documents into the tender engine
and monitor its revisions.
- All electronic documents are
to be vetted by the PM/ Client’s representative before
uploading to ensure currency of the document
- Files to be uploaded should be
compressed/ zipped to reduce the uploading time and storage
space in the e-tender engine.
- File names of documents and
drawings should be named/ renamed as a readable name for easy
identification. This is oppose to coded names (e.g.
10022004PAQS_FOT_et.doc VS Form of Tender 10022004_
Etender.doc ).
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There are also
other issues to be considered by the consultants, issues such as
copyrights and Intellectual Property (IP) issues. The following
should be considered and adhered:
- Ensure that all documents are
submitted as portable data files (PDFs) to maintain minimum
copyright.
- Ensure all drawings files,
unless otherwise stated, are read-only or plot files.
- If there are setting controls
in the tender engines, the tender coordinator may set the
tools in the tender engine to enable the contractor to view
the file instead of downloading and printing the files and
drawings.
During tender
submission, the contractor is to have the following considerations :
- Contractor is to submit the
form of tender on-line together with all the priced sections.
- There is no need for the
contractor to resubmit the non-priceable documents e.g.
specifications.
- Tracking of the originality of
the documents can be traced by the origins of the properties
of the document which would have been tracked by the tender
coordinator.
- The contractor is to encrypt
the submitted documents with the contractor’s digital
certificate (preferably corporate certificate)
- All documents submitted should
be submitted on a common platform and version. For example, MS
Office 2000 or AutoCad 2000.
To ensure the
success of e-tenders or any web based applications, the contractor
has to be primed and informed of what is needed for the tender.
Consultant QSs will carry this out via the prelims. There should be
provisions for:
- Internet/ lease line
connection on site (specified if wireless cabled)
- Number of Personal Computers/
Laptops
- Minimum requirements of the
hardware (e.g. minimum Pentium III/ Processor speed and RAMs
needed)
- Mention the type of software
the hardware should have (e.g. MS Office 2000, including MS
Words and Powerpoint, AutoCAD 2000 etc)
- Paramount to state whom the
hardware and software should belong to at the end of the
project and in what condition is the accessories expected.
- There should not be any catch
all clauses as this would artificially increase the tender
price
- Electronic Data
Interchange Agreements
It is uncommon for
nations to have acts governing the use of electronic data. For
example, there is the Electronic Transaction Act that briefly
endorses the effectiveness of electronic information such as emails
and attachments. However, this does not address the process and
considerations that governs the standard of information that is
being transpired nor does it address the way information can be
authenticated (between the digital information and the actual
information that was uploaded). Hence, the formation of a Electronic
Data Interchange Agreement (EDIA).
There was an attempt to start a
standard EDIA document in the construction industry of Singapore.
This was because all methods of communication require a set of
minimum standard of discipline to be observed by the communicants
so as to ensure that the information communicated is effective.
Thus the EDIA can be said to attempt to set out the minimum
standard with respect to the exhange of data and information via
electronic means. By agreeing to an EDIA, the parties cannot claim
to be ignorant of the rules and conditions in the standard.
The EDIA sets out
to complement the underlying commercial or contractual obligations
of the parties involved and it does not set out to alter what the
contracting parties have agreed in the main contract. Thus this EDIA
is indeed a separate agreement with the need to separately sign the
EDIA document. Here are some of the salient points that the EDIA
must contain:
- A sender may request that the
receipt of its message be acknowledge by the recipient
- A sender may request, in
addition to the acknowledgement, confirmation from the
recipient that the consent sent meets the recipient’s
requirements.
- A proof of copy of work is to
accompany the transmission i.e. to Cc to project folder or
achieve.
- Agreement that pretender
information to be burned and stored into a Read Only (RO)
Compact Disc (CD). This is to protect the recipient when
accused of modification or tampering with the original
documents.
- This ROCD can be kept at a 3rd
party’s premise or stored in an off-shore account to be
agreed by the parties.
The epoch of e-tendering and
e-processes in the construction industry is here to stay, no
matter the country. It is a positive move to globalisation with
the breaking down of the national barriers with the use of the
Internet. This paper celebrates the amalgamation of new economy
thinking and processes with old economy values and traditions.
E-tendering does not bring along a total paradigm shift, rather,
it brings along much benefits to productivity and efficiency,
promoting business efficacy with minimal need to business process
re-engineer (BPR) to the current process. BPR may be needed on
in-house QS software to cater for e-tendering (e.g. conditioning
the QS software to CITE compliance). Never-the-less, e-tendering
will bring much excitement to the construction industry of
Singapore and to the world once it is fully embraced and
implemented, creating a new breed of QSs to do the job.
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