What is the confidence level that tenders will be robustly evaluated?
£ billions per annum is expended by private sector organisations, preparing tenders for clients in the public and private sectors. The processes used in the private sector are often steeped in mystery. There is no published evaluation criteria, nor any detailed feedback at the end of the process. The public sector process is more visible and to, an extent, accountable. Brian Farrington Ltd actively monitor published audit reports. They are informative, amusing and tragic in some cases. The “Report of the Auditor-General of South Africa on an investigation into the procurement of various contacts at the Gauteng Provincial Department of Roads and Transport” published in June 2011 (109 pages) is recommended reading for affectionados of procurement.
The audit “investigation”, looked at contracts pertaining to:
– Security services bid at various buildings to five service providers
– Construction of roads to three service providers
– Contract: Intelligent Number Plate (INP)
– Establishment of four new driver licence testing centres (DLTCs) and the turnaround strategy for DLTCs
– Biometric verification system and
– Construction at Derek Masoek building.
We highlight some extracts from the Report and make general points for consideration by our readers.
Adequate leadership oversight. “This category underscores the importance of leadership creating the correct environment in the organisation. It includes the manner in which leadership monitors performance and compliance and the way in which ethical behaviour is promoted. Leadership oversight is also about preventing an organisational culture of impunity and about acting decisively to correct deficiencies.”
For some organisations, this will raise a question about the extent of knowledge held by the leadership and their ability to ask the right questions.
The scoring and awarding of points to bidders during the evaluation process were inconsistent and inaccurate
This raises issues about the documentation of the evaluation process; briefings for members of the evaluation panel and the motivation of panel members for their inconsistent and inaccurate scoring. There will be occasions when a particular supplier(s) is being promoted, perhaps because of known and proven specialities. On other occasions the reasoning can have more sinister overtones.
In one instance, a service provider was appointed essentially to implement a process that involved the review of the service provider’s own work
This type of problem reoccurs and, worryingly, the conflict of interest is either not known or it is conveniently ignored. In a broad context there are situations in IT where a specification is written by a company who will bid for the contact. This is a flawed approach, raising the point that procurement should have the oversight to identify conflicts of interest.
One of the contracts reviewed was for security to be provided in 5 regions. A budget of R66 144 000 was available. The strategy was to appoint one supplier per region. It is reported that 315 bids were received for regions A to E. The validity period of the bids was 60 days, in contravention of the standard validity of 90 days. The tender box was not opened on the date stated in the bid document. When it was opened no bidders, representatives of bidders or representatives of Security Management were present to observe the process. On the day the bids closed there was a public service strike. The Audit Report adds, “Since the security cameras in the department building where the tender boxes were stationed are not operational, the AGSA was unable to verify whether any bids were deposited after the closing date or how the opening of the box was handled. This saga of events culminates in the report with: “Based on the discrepancies identified above, all five successful bidders should have been disqualified in the preliminary stage of the evaluation process. However, they proceeded to the next stage of the evaluation and ultimately became the successful bidders.
If you would like to learn more about how we might be able to help you achieve your procurement goals, please contact me and we can have an informal chat to discuss your areas of interest.
Alternatively you can call me on 01744 20698.
Thanks
Steve
