Challenges of Bid Management

Though the process of Bid Management is as simple as Responding to a Tender Document, it certainly involves a lot of Intra-Organizational or Inter-Organizational coordination of multi functional departments. Some of the challenges of managing bids are being highlighted here.

  1. Stringent Deadlines:

    Most important factor is the Deadline, as bid submission dates are not under control of organizations. Organizations should always be ready with well equipped processes and well trained resources to handle urgencies regarding bid preparation and timely submission. Most important factor while dealing with short duration bids is the Leadership. If the actions and responsibilities are planned well and the job is led by an efficient leader, it is quite possible to meet even the tight deadlines.

  2. Decisions of Bid/NoBid (Go/No-Go decisions):

    This is the processes of deciding whether an organization should go for bidding or not to Bid. It is quite obvious that each and every tender floated may not fit organizations’ competency. Hence, before starting the actual work, it is necessary to know whether the tender is to be responded or not. The procedures and methodologies of Bid/NoBid decision making vary for each and every organization. The process of Bid/NoBid decision making involves analyses of various factors related to Eligibility Criteria, Technical Scope of Work, Commercial Terms, availability of recourses, Risks involved with project execution, Payment Terms, Legal Terms, Financial Factors, Geographical & Socio-Economical conditions and other relevant feasibility aspects. The Bid/NoBid decisions are made on the basis of Qualitative or Quantitative or both kinds of analyses by subject matter experts or by the higher management. For the Bidding team to start the job at the earliest and to complete on time, it is crucial that the senior management takes the decision of submission or no-submission quite ahead of time. Many a time it so happens that since Bid/No-Bid decisions are not taken on early stages, the bidding team starts working as soon as they receive tenders. If the decision is No bid, the time spent on that tender is considered as waste but is necessary to handle on time deliveries.

  3. Availability of Resources:

    Resources are of various kinds such as Human Resources, Infrastructure, Equipment, tools etc. Timely availability of required resources to complete a bid is completely dependable as the Bid Management deals with a variety of people of multiple disciplines that are internal or external to the organization. Timely availability of employees of Technical, Finance, HR, Legal or Commercial Departments or availability of any external consultant, a vendor, Bank, a Chartered Accountant, Court or a Courier agency plays a crucial role in making competitive responses as well as in final submission before deadline. The infrastructure required to prepare a bid such as Software licenses, hardware (computers, Printer etc.), Customized tools, Samples of products, any testing equipment etc. are to be gathered well in advance. This dependency can be handled only with the help of a well written plan of bidding process, well established communication channels and continuous monitoring or coordination.

  4. Coordination with Bid Team:

    Bid Team consists of the people involved to make the bid and get it delivered to customer on time. The team members of one bid may not necessarily be same for other. The team composition varies according to the scope or kind of Tenders. In many of the organizations the team members belong to different departments and they report to their functional heads. This gives a Bid Team a weaker structure due to lack of direct authority of Bid Manager over the team members who belong to other departments or other external organizations. The coordination and control of activities will become tougher if the bid Manager does not establish a compatible relationship with the functional departmental staff and their heads. As this is the most important activity of Bidding process, this has to be handled with utmost care by establishing interpersonal relationships across the internal as well as external organizations. An efficient communication channel will help in coordination.

  5. Technology Partnership or Teaming:

    Teaming, Partnership, Joint Venture or Consortium etc. are some of the processes of making the organization capable to meet the unmet eligibility criteria specified in Tender document. For example, when an organization lacks experience in specific area or it does not have technology asked by customer, organizations usually go for partnering with a competent partner. Searching the suitable partners, finalizing one and signing an agreement with them are challenging tasks. Sometimes the tender may ask for a specific resource with a very specific technology on organizational payroll. In case of absence of such human resources, the organizations have to find a suitable external consultant and sign an agreement mentioning that he/she will be hired if the contract is awarded. These agreements usually are lapsed once the awarded project is closed.

  6. Coordination and Timely receipts of required Documents:

    The Bid Management is all about requesting various departments for the required documents and receiving them timely by efficient communication and coordination. This is further linked to all the factors of time management to write a response, availability of resources in other departments, the relationship with those teams and other intra or extra organizational factors. The main goal is to receive quality documents on time which is not as simple as it sounds. Most of the bids are delayed due to non receipt of required documents on time or receipt of documents just before finalization of proposal or last minute changes. This severely affects the quality of proposal due to lack of ample time for final review.

  7. Documents from multiple sources:

    The Proposal consists of many sections with various documents from various sources. For example, Earnest Money Deposit, Power of Attorney, Joint Venture Agreement, Notarized Affidavits, Quality Certificates, Certificate from a Chartered Accountant, Attested copies of original documents, Income Tax/Sales Tax/Service Tax Certificates, Provident Fund related documents, ESI related documents, Bank Solvency Certificate, Annual Reports, Memorandum & Articles of Association of the organization, details of Board Members etc. These documents are created in house as well as issued by Financial Institutions, Courts or any other legal body. The updated/upto date documents should be collected and kept ready well in advance so that last minute rush can be minimized.

  8. Public Holidays, Bank Holidays or Local Disturbances:

    Some of the documents mentioned above are not created in house and are issued by Financial Institutions, Courts or any other legal body. These documents should be prepared well in advance by considering the Holidays as well as turnaround time required for their preparation. Some of the bids are disqualified because of non submission of these documents as they are considered mandatory. Delivery or dispatch of proposals is planned according to national & local holidays; Political, Geographical & Climate/Weather conditions; or any other factors that may affect the timely delivery of the proposal.

  9. Vendor Coordination and Management:

    Vendors are the external organizations or individuals who provide goods required for execution of project if awarded. At the time of bidding, their coordination is required to get the lowest pricing for goods or components that are being offered in the proposal. Based on their quotations, pricing is worked out to prepare Financial Proposal/Price Bid. Finding and finalizing Vendors and negotiating the price is a challenging task that usually be handled by senior members of bid team.

  10. Restrictions on number of Pages of Proposal or File Size of e-Bid:

    Sometimes the customer needs a proposal to be written only in certain number of pages. This restriction may be set only for few sections or entire proposal. In this situation the Bid Manager or Proposal Manager has to see that the entire content to be squeezed as per the restrictions without compromising with the message. This can be handled with the help of pictorial representation of the persuasive messages i.e. suitable images/diagrams/graphs, flow charts, configuration diagrams etc. While submitting an online e-Bid, the Bid Managers needs to manage the file size of bids to meet the limits allowed by e-tendering web sites. File Compression tools are required to handle this task.

The challenges on Bid Management are generic that are common for a particular industry as well as very specific that vary from tender to tender. Each and every Tender has to be dealt like an individual Project. As there is no end for this topic, I would like to conclude by saying that the job of Bid Management is quite unpredictable though it can be effectively handled with efficient Planning and effective Leadership.

Vennu Manhoharr did his Masters in Applied Geology and currently doing MBA from University of Pune in Marketing Management. He is experienced in ITES (GIS & Photogrammetry) Industry dealing with Quality Management, Process Improvement, Project Management, Project Training, Technical Support and Bid Management. His hobbies include Fine Arts and Photography.

Author: Eddy

Eddy is the editorial columnist in Business Fundas, and oversees partner relationships. He posts articles by others on various topics related to strategy, marketing, supply chain, technology management, social media, e-business, finance, economics and operations management. The articles posted are copyrighted under a Creative Commons unported license 4.0. To contact him, please direct your emails to editor.webposts@gmail.com