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Tendering Process

Organizations face several challenges during the tendering process including complex tender documents, high competition, costs and resources required, risk management, and post-tender negotiations. Some ways to address these challenges include simplifying documents, setting realistic timelines, ensuring transparency, and incorporating clear sustainability and ethics criteria.

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Reginald Kusano
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10 views

Tendering Process

Organizations face several challenges during the tendering process including complex tender documents, high competition, costs and resources required, risk management, and post-tender negotiations. Some ways to address these challenges include simplifying documents, setting realistic timelines, ensuring transparency, and incorporating clear sustainability and ethics criteria.

Uploaded by

Reginald Kusano
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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what are the challenges faced by organisations during tendering process

Tendering usually refers to the process whereby governments and financial institutions invite

bids for large projects that must be submitted within a finite deadline. The word tender can also

refer to the acceptance of a formal offer, such as a takeover bid. This form of tendering is the

process whereby shareholders submit their shares or securities in response to a takeover offer.

During some a process there are certain challenges faced as the process take place such as

complexity and deat in tender document, high Competition, cost and resources , risk managent

and post tender negotiations.

First and foremost, organizations often encounter highly complex and detailed tender

documents, which can be difficult to understand and respond to accurately. The requirement to

comply with all specified technical, financial, and legal details adds to the challenge. Inaddition,

to avoid misunderstanding the organisation should ensure all tender documents, including the

Request for Proposal (RFP), specifications, and contracts, are clear, precise, and comprehensive.

Ambiguities can lead to misinterpretations and disputes.

Secondly, many tenders attract a large number of competitors, increasing the difficulty to win

contracts. Organizations must differentiate themselves while meeting all the specifications and

offering competitive pricing. However, what the organisation can do before launching the

tender, conduct comprehensive market research to understand supplier capabilities, market

rates, and potential challenges. This will help in setting realistic expectations and criteria.

Afterwards, preparing tender responses is costly and time-consuming, requiring significant

resources. Small and medium-sized enterprises (SMEs) particularly feel this burden, as they may
lack the dedicated staff or financial resources of larger companies. Implement a prequalification

process to assess the capabilities, financial stability, and reputation of potential suppliers. This

helps in shortlisting competent suppliers who can deliver as per the tender requirements.

Follwing that, tenders may involve stringent compliance and regulatory requirements. Failing to

meet any of these can disqualify a bid, regardless of its other merits.Before finalizing any tender

documents or contracts, have them reviewed by legal experts. This can help in ensuring

compliance with local laws and regulations, and in minimizing legal risks.

Inaddition., identifying and managing risks associated with the tender, including financial,

operational, and reputational risks, can be challenging. Organizations must carefully consider

whether the potential rewards of winning the tender justify the risks involved. However,

develop contingency plans for critical risks. This includes identifying alternative suppliers,

considering buffer times for project schedules, or planning for potential cost overruns.

Later, the tender process often operates on strict deadlines. Gathering all necessary

information, completing detailed submissions, and ensuring compliance within the given

timeframe can be difficult.furthermore, for an organization setting up staged payments based

on milestones or deliverables may improve the process. This encourages suppliers to adhere to

timelines and quality specifications, reducing the risk of project delays and cost escalations.

Later, some tenders require disclosing proprietary information or innovative solutions.

Organizations must navigate how to share enough information to be competitive while

protecting their intellectual property and confidentiality.Establish transparent, objective, and


fair evaluation criteria that are known to all bidders. This minimizes the risk of complaints or

legal challenges from unsuccessful bidders.

Subsequently, for international tenders, there may face additional challenges related to

language barriers, cultural differences, and the need to understand local laws and regulations.

However, this can be solved by maintaining regular communication with potential and selected

suppliers. This helps in promptly identifying and addressing any issues, thereby reducing the

risk of misunderstandings or non-compliance.

In an organisation, navigating the ethical considerations, avoiding conflicts of interest, and

dealing with the potential for corruption can also pose significant challenges.Inaddition, Once a

contract is awarded, continuously monitor the supplier's performance against the contract

terms. Regular evaluations can help in identifying any deviations early and allow for corrective

actions to be taken.

Lastly, Even after winning a tender, organizations might face difficulties in negotiating final

contracts or managing complex projects, affecting the anticipated benefits of the tender.

However,the organisation should clearly define the allocation of risks in the contract. Specify

who is responsible for managing various risks, such as delays, cost overruns, or quality issues.

Fair risk allocation can lead to more competitive pricing and better supplier performance.

In conclusion, in order To mitigate these problems, organizations can adopt several strategies,

such as simplifying tender documents, setting realistic timelines, using digital platforms to

enhance accessibility, ensuring transparency at every stage, and incorporating clear criteria for
sustainability and ethics. Ultimately, improvements in the tendering process can lead to more

competitive bids, innovation, and better outcomes for both procurers and suppliers.

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