Prospector
an exploration of bidding from
opportunity to winning profitable
business
Prospector
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Prospector
an exploration of bidding from opportunity to winning profitable business
This simulation is designed to allow you to
explore the commercial aspects of winning
profitable business.
A computerised business model will simulate
the impact of your actions and those of
several virtual competitors
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The Simulation
Preparation
 Familiarisation
Winning Profitable Projects
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Search for Opportunities
Pre-qualify the Project
Prepare and Refine the Tender
Negotiate the Contract
Win the Bid
Review
 Execute Projects
 Present, discuss & compare
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Contents:
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Your Situation
The Projects
The Clients
The Competition
The Deal
Influencing the Deal
The Bidding Cycle
Your Decisions
Using the Computer
Learning through Simulation
Observations
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Your Situation
Newly setup subsidiary in Eastern Europe
You must build a portfolio of projects for next year
You have a small team of commercial staff to bid
You can call on the parent for pre-contract design
Next year you will have your own design staff
You may have some experience of like projects
And a prior relationship with some customers
All prices and costs are in a universal currency
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The Projects
Design projects that differ in terms of:
– Size (from 100 to 2000 design weeks)
• Many Small (<400 man weeks)
• Some Medium (400 – 1200 man weeks)
• Few Large (>1200 man weeks)
– Technical Complexity
• Low through High
– Urgency (desired completion week)
• High (completion in first half year)
• Medium (completion in third quarter)
• Low (completion in last quarter)
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The Clients
• Types of Customer
– Public (probably financially safe)
– Private
– Other (possibly financially risky)
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May have Prior Experience (of like projects)
Relationship (possible prior and changing)
Competency (most reasonably high)
Aggression
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The Competitors
• There are several virtual competitors
– Delaise Percival
• Large Multinational but not well established
– Justin Tyme
• Medium Sized local company but financially weak
– NoJob2Odd
• Small local company with high profit margins
• Historic margins from 10 – 16 %
– Margins that seem to depend on
• Competitor
• Urgency
• Size
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The Deal
• Contract Style
– Fixed Cost
– Capped Cost Plus
– Cost Plus
• Agreed Start & Completion
• Payment Terms
– At start, at completion, retention &
stages during the design period.
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Influencing the Deal
• Client Meetings
– Improve the relationship
– Reduce ambiguity and uncertainty
But
– Will plateau
– Take bidding time
• Pre-contract Design
–Improve chances of winning
–Reduce post-contract design work
But
–Costs money
–That will not be recovered if the contract is lost
–Improvements not guaranteed
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The Bidding Cycle
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Search for Opportunities
Pre-qualify the Projects
Tender
Negotiate
Win the Bid
(Simulate Outcomes)
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Search for Opportunities
Expend effort to search for opportunities that
match the criteria you set.
Some clients may come to you.
You receive information about
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Project Size (small, medium or large)
Your Project Experience and Client Experience
Project Urgency (high, medium or low)
Prior & Current Relationship
Client Type (public, private or other)
You need to decide which to pre-qualify
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Pre-Qualify
Get new information about the project
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Expected Work (in man-weeks)
Desired Completion (week)
Contract Style (Fixed Cost, Capped Cost +, Cost Plus)
Technical Complexity (low, medium or high)
Client Aggression
And reprised information about
• Prior & Client Experience
• Current Relationship
You need to decide which to prepare for tender
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Prepare to Tender
Get new information about the project
– Range of work durations
– Price & probability of winning
And reprise the information you have about
– Technical complexity
– The Client
And budget
– For design work
– Oncost %
– Perceived Project Risk
Eventually submit tender price
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Negotiate
Negotiate:
– Start and finish dates
– Payment schedule
Client Feedback
– Clients will provide feedback on individual
areas, showing different levels of rejection or
acceptance.
– from
through
to
Eventually make final offer and win or lose
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Win the Bid
After negotiating you will make the final
submission to the client and hopefully
win the business.
A bid that has maximum profitability and
minimum risk!
But, your negotiation may make a
competitor’s bid better.
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(Simulate Outcomes)
At the end of the simulation:
– you decide funding needs
– design staff levels.
Then all the contracts that you have won will be
executed and you will see:
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The difference between actual and budget work
If you completed on time
If you made an adequate profit
Whether you had the funds and staff
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Your Decisions
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Opportunity Search Criteria
Projects to Pre-qualify
Projects to tender
Explore tender prices
Submit tender
Negotiate project timing & terms
Submit final bid
Meet with client
Pre-contract design work
Forecast staff and funding needs
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Sequential
for
individual
bids
At any stage
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Using the Computer
• Decide team name (up to 6 letters)
• Select from menu
• Help available about
– Help with using the software
– Advice on the current task or report
– Explanation of result or decision
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Simulation
Name
Simulation
Version
Desk Top
Current Entry
or Report
Task Bar
Help &
Advice
Control
Button(s)
Printer
Control
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Current
Time
Aids
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Learning through Simulation
You will be working in small groups so that
you can:
– Share knowledge & experience
– Promote, present and negotiate ideas
– But, not rely on preconceived ones
The trainer is there to:
– Answer your questions
– Coach you
– Challenge you
– But not tell you what to do
You are in charge of the learning process
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Observations
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it takes time to understand
It will take time to get
your feet wet.
but the business still has to be run
therefore your decisions will not be perfect
time will be a constraint
• by the end you should (just) be in charge
• your business skills will be challenged
• remember the purpose is to learn!
(rather than just to win!)
• so, take time to reflect & review But the tutor is
there to help.
• and have fun!
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