An output based assessment submitted to Engr. Michael V. Almeida
as partial fulfillment of the requirements for the subject
4690 CMPROMGMT - CONSTRUCTION PROJECT AND MANAGEMENT
Submitted by:
Alonzo, Jerico
Lansang, Paula Gestine
Reyes, Anne Clarice
Yalung, Miguel
Yamaki, Nozomi Mikaela
BACHELOR OF SCIENCE IN CIVIL ENGINEERING PROGRAM
School of Engineering and Architecture
Holy Angel University
OCTOBER 11, 2022
CASE PROBLEM NO. 3: NO SUBCONTRACTOR COVERAGE
I.
MAIN ISSUES/PROBLEM STATEMENT
● Three of the four qualified general contractors were unable to submit their
bids. On the other hand, Contractor No. 4, despite having full workload,
nevertheless submitted a courtesy bid, however, it was made out of
incompetency and was prepared by a temporary estimator.
○ And since the general contractor did not expect to be awarded the
project, and the estimator quit the day after the bid was submitted,
they had to hire a project manager.
II.
ANALYSIS OF ISSUES
● The main problem is that Contractor No.4, despite their heavy
workload and tight schedule, submitted a bid as a courtesy without
expecting to win the contract. The client had a good reputation, and
the estimator assigned to the job quit after submitting the bid. Now
Contractor No.4 is in a difficult situation. Cross Link (2020) noted
that it can be tempting for some subcontractors to rush their bids to
meet the deadline, which risks inaccuracies. In the end, they may
not have reviewed the documents properly. Contractor No. 4 could
have offered the best possible price and avoided an associated
lawsuit if he had simply studied the project properly instead of just
doing so as a courtesy.
III.
COMMENTS ON EFFECTIVE SOLUTIONS
● Rejection of the Award. Contractor No. 4 should not accept the award
because it has already been implied that they have a lot of work ahead of
them, and given the client's combative reputation, they should simply
decline. It is very rare for a successful Bidder to reject a Contract award,
but where this occurs it might be because he now has a heavy workload
and cannot guarantee commencement of the works/services any time
soon (Emokpae, 2016). However, if they do accept the contract and
submit a new bid, they should be aware of the bidding requirements, while
preserving their own reputation and considering the client's combative
reputation, to avoid further legal action, penalties, or even losses.
IV.
ANSWER TO CASE QUESTIONS
1) What errors did contractor 4 make in the estimating process? Should they
accept the award? Can they ethically go out and rebid to the subcontractor
industry? Are they in a strong or a weak position for subcontractor and
supplier buyout opportunities? Who has the upper hand with contract
negotiations in this scenario, the contractor or the owner?
● Given the sophisticated nature of the project's 27,000 PHP/sq.m
and the assumption that a workable plan currently exists since a
highly skilled architect is involved, even if it is done out of
politeness, Contractor 4's submission of the half-hearted offer is
extremely unprofessional.
Since they have a heavy workload and the customer has a bad
reputation for being aggressive, they shouldn't take the prize, in our
opinion. Instead, they should explain their reasoning and reject it.
To avoid additional legal action, penalties, or even losses, they
should be aware of the bidding terms and conditions, maintain their
reputation, and be conscious of the client's aggressive personality.
The contractor may want to provide them with enough time to
create accurate estimates and to rebid because Except for them,
no one else made an offer.
Due to the client's unstable image, which causes them to receive
fewer bids, they are in a poor position. In fact, no one truly has the
upper hand in this scenario because contractor 4 filed an
inadequate offer.
2) Because the GC did not anticipate getting the project, and the estimator
distanced himself from it as soon as possible, they had to go outside to
hire a contract project manager (PM). This PM had a similar reputation to
the owner’s representative. He was known to be extremely tough, and the
GC felt this is the type of personality they needed to financially come out
even, if not ahead. How do you think the two individuals approached doing
business with each other? How did they deal with the other team
members? Would you be surprised to find out that this project was a huge
success?
VI. REFERENCES
A guide to the construction bidding process. Cross Link. (2020, November 26).
Retrieved October 11, 2022, from
https://crosslink.com.ph/blog/guide-to-construction-bidding-process/
Award Recommendation and Contract award: what to consider. Ayi Emokpae.
(2016, July 18). Retrieved October 11, 2022, from
https://www.linkedin.com/pulse/awardrecommendation-contract-what-consider-ayi-emokpae