FACULTY OF ARCHITECTURE, PLANNING, AND SURVEYING
UITM CAWANGAN PERAK KAMPUS SERI ISKANDAR
CONTRACT AND CONSTRUCTION MANAGEMENT (BSR304)
e-TENDERING
PREPARED BY: NUR SOFEA SAFIRAH BT MOHD NASIR
MATRICS NO: 2019232594
GROUP: AP1195B
PREPARED FOR: DR AN NISHA NUR WELLIANA BT ABDUL RASED
TABLE OF CONTENT
NO
CONTENT
PAGE
1.0
INTRODUCTION OF E-TENDERING IN MALAYSIA
1
2.0
LITERATURE REVIEW ABOUT TWO TYPES TENDER PROCESS
2
2.1
OPEN TENDER
2
2.2
PRE-QUALIFICATION TENDER
3
3.0
CASE STUDY
4-6
4.0
BENEFITS OF PRACTICING E-TENDERING
7
4.1
ADVANTAGES AND DISADVANTAGES OF OPEN TENDER
8
4.2
ADVANTAGES AND DISADVANTAGES OF PRE-
8
QUALIFICATION TENDER
5.0
CHALLENGES IN E-TENDERING IMPLEMENTATION
9-10
6.0
CONCLUSION
11
7.0
REFERENCES
12
8.0
APPENDIX
13-16
1.0 INTRODUCTION OF E-TENDERING IN MALAYSIA
What is e-Tendering? e-Tendering means electronic tendering as known as e-Tendering is a
way of sending and receiving tenders via the internet instead of the traditional paper method.
e-Tendering will now exchange papers securely over the Internet, rather than stuffing them
into an envelope and mailing them.
e-Tendering is a component of the method of conducting procurement online, particularly to
make sourcing suppliers quicker. From the time the requirement is advertised to the time the
contract is placed, none of the software used in the process is installed on the computers of
either the procurer or the supplier, and all paperwork exchanges are done via the internet.
It automates the method of managing tenders through this digital framework, enabling
smoother, more regulated procurement that allows the procurer to monitor and assess bids
with convenience. Rather than the old paper method, which causes poor audit trail, high paper
usage, and poor information safety.
1
2.0 LITERATURE REVIEW ABOUT TWO TYPES TENDER PROCESS
2.1 OPEN TENDER
Anyone can submit a tender to supply the goods or services that are necessary under open
tendering, and every organization has an equal chance to submit a tender. The engineering
and construction industries are the most common recipients of this sort of tender.
The open tender also is a method of obtaining goods or services at the lowest possible cost.
The aim is to increase competition while reducing discrimination. This is a transparent
procurement process that permits rival contractors, suppliers, or vendors to compete fairly.
There are two forms of bidding which are open bidding, where the seals are visible and closed
bidding, where the seals are hidden (seals are openly given a selective audience). Open
competitive bidding, open competition, or open solicitation are other terms for it.
Why open tender is used in construction? It is because open tendering is used for a buyer to
procure simple goods or services. For more complex and larger projects, a pre-qualification
process will likely be used. Pre-qualifications can come in a variety of forms such as prequalification questionnaires or selection questionnaires.
2
2.2 PRE-QUALIFICATION TENDER
Pre-qualification tender is identifying contractors who have indicated that they are qualified
and interested in bidding on a project. Pre-qualification is not the same as tender, it is not
always used and is not always required. Most contracts are offered for tender in the public
domain and do not require pre-qualification. Pre-qualification is typically used on large,
complex projects that necessitate specialized technical knowledge. Pre-qualification also
allows for Early Contractor Involvement (ECI), which is a cost-effective, more efficient, and
less contentious way of designing and planning construction projects in which certified
contractors can provide their skills right before the start of a project.
3
3.0 CASE STUDY
Table 1.0 Open Tender
WORKS
Upgrade
electrical
TYPE OF
TENDER
Open
tender
of wiring
FIELD/CLASS/
TENDER VALIDITY
HEAD/SUBHEAD EXPIRATION DATE
20/03/2022
E04, E05
cable
submain, tools, and
responsible powers
at the University of
Science
Malaysia
Hospital,
Health
Campus,
Kubang
Kerian, Kelantan.
Figure 1.0 Open tender notice details
4
ELIGIBILITY
LEVEL
Registered with
CIDB.
Table 1.1 Pre-qualification Tender
WORKS
PRE-Q
REQUIREMENT
TYPE OF
NUMBER
TENDER
MAHBMASB/ i) All experienced Local PreProposed Upgrading &
PRE-Q/
qualification
Expansion of Penang
Contractors, having the
01/2019
tender
International Airport, Pulau
proven
capacity
to
ELIGIBILITY
LEVEL
i) CIDB: Grade G7
Pinang, Malaysia
undertake
B04 & CE21
Works Package: WP01
project (execution and
ii)
Proposed Execution And
completion of projects
Syarikat Malaysia
Completion of Enabling
including
(SSM)
Works, Ancillary Buildings,
services,
Infrastructure And Other
equipment.
Associated Works.
ii) Sufficient resources to
undertake
the
above
special
facilities
the
&
project
with adequate technical
expertise.
iii) Sound financial track
record and recognized
creditworthiness.
iv)
Successfully
constructed
completed
and
civil
and
building works or similar
works in the last 10
years.
5
Category: B & CE
Specialization:
Suruhanjaya
Figure 1.1 Pre-q tender notice details
6
4.0 BENEFITS OF PRACTICING E-TENDERING
The e-tendering method has benefited others greatly, and it has been acknowledged as a way
for governments to cut administration costs and become more effective in the online tendering
of goods. Cost savings, process reorganization, and improved contract fulfilment are just a
few of the advantages that e-tendering may provide. It can save money by using e-tendering
because it reduces the cost and effort of processing purchase orders that may be altered
electronically, as well as inventory expenses and order fulfilment time. There are four sorts of
cost savings that can be realized by using an e-tendering system.
Furthermore, order cost, administrative cost, lead-time order cost, and capital opportunity cost
are some of them. E-tendering allows for quality bidding, efficient timeliness, cost savings,
minimizing business efforts, reducing financial and technological hazards, and lastly
increasing competition, all of which minimize the cost of purchasing goods or services at high
prices. Because of the great availability of information, public sector bidding is one of the finest
settings for implementing the e-tendering of products and services.
Lastly, change is difficult to accept, but one clear benefit of e-Tendering is that it is a
straightforward contract management solution that saves you time and effort on paperwork
and footwork, allowing you to spend more time doing the things you need to do. Converting to
digital can help you improve connections with strategic suppliers, locate new trustworthy
suppliers, and interact more effectively with your team.
7
4.1 ADVANTAGES & DISADVANTAGES OF OPEN TENDER
Each tendering process has its benefits and advantages. Open tendering in construction offers
the greatest competition and allows smaller businesses to get the opportunity. This
encourages innovation and allows a buyer to view a greater range of proposals.
Table 1.2 Advantages & Disadvantages of Open Tender
ADVANTAGES
High transparency and competition.
DISADVANTAGES
Can select a contractor who has no
experience.
Create opportunities for a greater number
Time consumption is more for the tendering
of contractors.
process.
The owner will get a better price.
Unreliable competition.
4.2 ADVANTAGES AND DISADVANTAGES OF PRE-QUALIFICATION TENDER
Prequalification refers to a process through which a buyer business screens seller business
to assess their capabilities to effectively deliver on a tender awarded.
Table 1.3 Advantages and disadvantages of pre-qualification
ADVANTAGES
Reduces the number of tender documents
DISADVANTAGES
Companies have a smaller pool of bidders
that the buyer company will receive as only leaving out others who could have better
prequalified companies can tender for a
methods and technologies but could have
contract.
been kicked out during prequalification.
Enables the buyer company to identify firms
that have the necessary capabilities for
example financial or expertise to deliver on
particular tenders.
8
5.0 CHALLENGES IN E-TENDERING IMPLEMENTATION
In the field of business applications, the e-tendering system is a relatively new development.
Factors offering challenges influence the public sector's response to these development
advancements. Employee expertise, technological infrastructure, and concerns about the
security and privacy of procurement transaction data are some of the problems that may arise.
As a result, these factors may influence the adoption process of e-procurement, providing
obstacles, and this study aims to analyse these variables in order to better understand how
they influence e-procurement adoption in the public sector.
Competency procurement employees must be capable of using software tools that provide
the organization with management abilities to manage their activities, such as the distribution
chain and value addition in a business. This technology is built on databases that can be
quickly accessed in real-time. The need to train workers in procurement processes and the
use of e-Procurement tools is crucial to the success of an e-Procurement effort because eProcurement involves new technology and changes in old procurement approaches. Once
end-users understand the operating functions of the e-Procurement system, they may
immediately see the benefits. This means that training should be prioritized, coupled with the
necessity for government agencies to determine the skills necessary for all procurement
personnel. Employees clearly play a significant role in e-procurement adoption, and their skills,
abilities, and training may have a significant impact on how e-procurement is implemented in
a business. It cannot be overstated in a commercial context because without it, any
organizational objectives such as e-procurement may fail.
Secondly, inadequate technological infrastructure. The development and implementation of
information technology are important to the e-procurement challenge. Systems integration is
a vital success factor for e-procurement adoption, both in terms of the customer's information
infrastructure and its supplier relationships. Email and online sites are the most common and
widely used systems, while major banks enable electronic money transfer, which is a safe and
low-cost method of payment. The implementation of e-procurement is dependent on
technological infrastructure, without which public procurement organizations will not be able
to integrate. In view of the truth that government departments have various levels of
technological infrastructure, this study will attempt to establish the role and influence of this
aspect in e-procurement adoption. Suppliers, on the other hand, are at various stages of
infrastructure development, which is important in understanding how this diverse technology
infrastructure is integrated to enable e-procurement implementation. Understanding the
9
various levels of infrastructure in public procurement bodies and suppliers will assist the
government in quantifying the amount of software and hardware investment that will be put
into e-procurement adaptation.
A number of recent studies have looked into the challenges that companies experience while
launching e-procurement. Concerns about the security and confidentiality of data needed to
be communicated in electronic environments were identified as one of the impediments to
electronic procurement implementation. Buyers' perceptions of e-procurement risks were
identified, and three dimensions emerged which is transaction risks resulting from incorrect
product purchases due to incomplete or misleading information, security risks resulting from
unauthorized penetration of trading platforms, and failure to protect transaction-related data
while being transmitted or stored and privacy risks resulting from inappropriate information
collection and transparency. The lack of proper security measures to secure data was
identified as one of the prohibitive and discouraging problems in the deployment of eprocurement by both buyer and seller firms in their sample.
10
5.0 CONCLUSION
e-Tendering means electronic tendering as known as e-Tendering is a way of sending and
receiving tenders via the internet instead of the traditional paper method. e-Tendering is a
component of the method to conducting procurement online, particularly to make sourcing
suppliers quicker. It automates the method of managing tenders through this digital framework,
enabling smoother, more regulated procurement that allows the procurer to monitor and
assess bids with convenience. Anyone can submit a tender to supply the goods or services
that are necessary under open tendering, and every organization has an equal chance to
submit a tender. The engineering and construction industries are the most common recipients
of this sort of tender. The open tender also is a method of obtaining goods or services at the
lowest possible cost. The aim is to increase competition while reducing discrimination. Why
open tender is used in construction? It is because open tendering is used for a buyer to procure
simple goods or services. Pre-qualification tender is identifying contractors who have indicated
that they are qualified and interested in bidding on a project. Pre-qualification is not the same
as tender, it is not always used and is not always required. The e-tendering method has
benefited others greatly, and it has been acknowledged as a way for governments to cut
administration costs and become more effective in the online tendering of goods. Cost
savings, process reorganization, and improved contract fulfilment are just a few of the
advantages that e-tendering may provide. E-tendering allows for quality bidding, efficient
timeliness, cost savings, minimizing business efforts, reducing financial and technological
hazards, and lastly increasing competition, all of which minimize the cost of purchasing goods
or services at high prices. Because of the great availability of information, public sector bidding
is one of the finest settings for implementing the e-tendering of products and services. Lastly,
change is difficult to accept, but one clear benefit of e-Tendering is that it is a straightforward
contract management solution that saves you time and effort on paperwork and footwork,
allowing you to spend more time doing the things you need to do. In the field of business
applications, the e-tendering system is a relatively new development. Factors offering
challenges influence the public sector's response to these development advancements. This
technology is built on databases that can be quickly accessed in real-time. The need to train
workers in procurement processes and the use of e-Procurement tools is crucial to the
success of an e-Procurement effort because e-Procurement involves new technology and
changes in old procurement approaches. Secondly, inadequate technological infrastructure.
The development and implementation of information technology are important to the eprocurement challenge. A number of recent studies have looked into the challenges that
companies experience while launching e-procurement.
11
6.0 REFERENCES
•
https://aavenir.com/glossary/e-tendering/
•
https://www.ecsourcinggroup.com/the-top-5-benefits-of-etendering/
•
https://www.researchgate.net/publication/315797650_EProcurement_in_Malaysian_Construction_Industry_Benefits_and_Challenges_in_Imple
mentation
•
https://myprocurement.treasury.gov.my/iklan/tender/
•
http://perolehan.usm.my/tender.php?md=tawaran
•
www.unescap.org
•
http://vms.malaysiaairports.com.my/index.aspx
12
7.0 APPENDIX
Figure 1.2 USM Hospital
Figure 1.3 Location of USM Hospital
13
Figure 1.4 Previous USM tender notice
14
Figure 1.5 Penang International Airport
Figure 1.6 Location of Penang International Airport
15
Figure 1.7 Previous Penang International Airport tender
16