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Faculty of Information Science and Technology, Universiti Kebangsaan Malaysia
Bangi, 43600, Selangor, Malaysia
Aim of this paper is to give a review on current practices practiced in Europe [26], Nigeria [4], Malaysia [38, 39],
of DSS technology in construction tendering processes. and Turkey [28]. Table 1 differentiates each type of
The organisation of this paper is structured as follows. tender.
Section 2 presents in general current practices of
construction tendering processes. General concepts and 2.2 General Tendering Processes
components of DSS are outlined in Section 3. Further,
Section 4 reviews on the implementation of DSS in Tendering processes in construction sector involve set of
tendering practices. Current challenges faced in DSS are parties. They are client and consultant as contracting
discussed in Section 5. Finally, Section 6 concludes with a authorities as well as interested organizations or
summary of this paper. contractors. Usually in many countries, the government is
the largest construction client. Client is also identified as
Client Consultant Contractor
2. Tendering Processes in Construction
Industry Initiate project
Tender Specification
As defined by Halaris et al. [36], tendering is the list of Preparation
processes to produce, display and manage tender Invite tenders
documents by client or consultant. It also involves action
View tender
to perform bidding by interested contractors in order to
Tender Aggregation
win the contract by responding to tenders with their
No
capabilities and skills formation. Meanwhile, according to Open submitted tenders Interested
Ng et al. [37], tendering processes begin with the analysis
Yes
to ensure tender specification meets with end users need, Access tenders and select
contractor Purchase tender
followed by contractor selection, tender invitation and documents
ending with contract awarding and contract monitoring. st
1 Stage Evaluation
The period of tendering processes is defined to begin with Fill tender documents
tender preparation and to end with tender completion.
Prequalified No
Submit tender
2.1 Types of Tender Method
Yes
In construction industry, there are three different types of nd
2 Stage Evaluation End
Conventional tendering involves receiving, checking, assessment such as bid price, time for project completion,
copying, and distributing processes which are financial capability, work experience, technical staff
implemented based on paper-based. The approach remains available, equipment facilities and current list of works.
predominant in developing countries such as Malaysia [24, These criteria contribute to identify potential contractor
40], Nigeria [41], and Oman [42]. Strong emphasize on that capable to deliver high quality of completed service,
the need of ICT in Malaysian construction tendering were within time and under budget allocated [28]. Usually, the
discussed by Lou and Syed Alwee [43] and Mastura et al. assessment is carried out by the group of appointed
[44] through their analysis according to Technology committees. This task is under responsibility of client or
Readiness Index. However, until now the real-world his representative and tender administration committee as
implementation of Web-based technology in Malaysian practices in China [45]. There are two stages of
construction tendering faced the biggest challenge to assessment before qualified contractors will be listed out.
realism. Fig. 1 summarizes the general tendering processes
according client, consultant and contractor perspectives. The first stage of evaluation is the prequalified stage for
Most countries in different region such as United States, contractors where they are primarily evaluated for their
Europe, Middle East and Asia have similar execution of minimum capabilities to satisfactorily carry out the
tendering. contract if they are awarded [11]. In this paper, we called
this stage as prequalification phase. This stage helps to
The process starts when the client initializes a construction screen out ineligible or unsuitable candidates thus
project. Client hires consultant to prepare tender minimizing the amount of available contractors in the list.
specification by conducting feasibility study. It involves Different countries or organizations might evaluate
typical activities such as determining estimated cost, time dissimilar criteria. For example, in Hong Kong and
for project completion and procurement procedures. Malaysia, the criteria for the first stage evaluation are
Consultant also responsible to prepare tender documents based on basic requirements specified in tender
including qualification documents and bill of quantities. notification or advertisement such as sufficiency of tender
These documents require an approval from client. In order documents submitted (compulsory and supporting
to ensure fair competition and transparency, it is documents), consistency of information provided,
compulsory for client to display notice call for tender adequate financial resources and others. It is different in
invitation. Normally, client advertises the notice within a other countries practices like in Turkey and Nigeria where
period of time on printed media such as newspaper, public their first evaluation are based on detailed technical
media or website. Construction tendering procedures evaluation. Contractors who have passed these
under European Union legislation requires a notice to be requirements according to certain standard value will be
displayed in the official Journal of the European preceded to the next stage of evaluation.
Commission [26]. Meanwhile in Nigeria, contractors are
invited for tender submission through advertisement in The second stage of evaluation normally comprises a
major national publications [41]. The procedure also detailed technical evaluation of prequalified candidates.
known as Request for Tender (RFT), Notice to Bidders or For instance, in Hong Kong and Malaysia, contractors are
Invitation to Tender (ITT). evaluated according to critical criteria such as such as
working experience, current work performance, technical
Subsequently, contractor who intends to bid for the tender staff, plant and equipment as well as estimated project
will purchase the tender documents and give appropriate duration. There are some evaluations practices only
information required, and then submits the completed consider on the lowest bidding price as implemented in
tender before reaching the deadline. Normally, tender Nigeria and Turkey.
documents consist of information regarding on instruction
to tenderers, conditions of contract, technical The qualified applicants who have fulfilled all the
specifications, drawings, bill of quantities (BQ) and list of requirements and conditions are ranked in ascending order
forms to be completed by the contractor. All the submitted according to their points/credits. Contractors who do not
tenders will be aggregated and opened after the deadline. fulfil any stage of evaluation will be automatically
removed from the list. Finally, the result will be
All the tenders received will be assessed in order to select announced by client and display it either on printed media
the most eligible contractor. Assessment is the most or website. Generally, the construction contract is awarded
crucial stage in tendering processes because it contributes to the contractor with the highest score.
to the decision in choosing the most qualified contractor to
win the tender. It is an unstructured and complex process
where multi criteria need to be considered during
IJCSI International Journal of Computer Science Issues, Vol. 7, Issue 2, No 1, March 2010 38
www.IJCSI.org
frequently used DSS term whilst vendors defined BI term applied in diverse research area of applications. In real-
and both terms refer to any tools with decision-making world practices, DSS applications could be implemented
functionality.
based, heuristic, object-based, logic-based or induction analysis model including cost and risk analysis model
based [59, 73]. [13], predictive modelling and Monte Carlo simulation
using Crystal Ball software [19] and Analytic Hierarchy
Process (AHP) [22].
4. Related Works of DSS in Tendering
Processes 4.2 Tender Bidding/Tender Submission
The potential of DSS as computerized tools in assisting Bidding is the most common method in competition to win
decision-making process has been attracting many the construction tender. It is concerned with two crucial
researchers for the last fifty years to improve decisions in decisions. The first is decision-making strategies in project
tendering processes. Most phases in tendering processes selection whether or not to bid for the job when the
involve crucial decisions that need to be made either by invitation has been received and the latter is prediction of
client, consultant or contractors. Prior researches that reasonable bid price if contractors opt to bid [74].
implemented decision-making concept in the area of Reasonable bid price or mark-up price is defined as the
construction tendering process are reviewed. Tender minimum price that possible to win the tender and could
specification preparation, tender submission/tender maximize profit at the same time [7]. Fuzziness in
bidding, tender assessment and contract monitoring are information on current new construction project, the client
classified into communication-driven, data-driven, preferences, the potential competitors and the overall
document-driven, model-driven and knowledge-driven. construction market make it a very complex process for
contractor to make decision. Table 4 reviews on several
4.1 Tender Specification Preparation researches that proposed approaches to assist contractor in
making decision. In model-driven approach, Delphi
Tender specification preparation is the feasibility study to method has been used to identify relevant factors that
analyse and consider risk and opportunity when proposing effectively contribute to decision for contractors either to
a construction project. During preparing tender take part in tender bidding or not, and estimate price to bid
documents, several set descriptors of criteria and relative [2]. Bid reasoning model operates on several crucial
weights are identified for the evaluation purpose. Table 3 factors from perspectives of reasoning goals that
summaries several researches that have included DSS contribute to the overall decision whether or not to bid [7].
technology during preparing tender specification. Costa et Meanwhile, fuzzy linguistic approach has been proposed
al. [5] proposed an approach to structure screening, by Lin and Ying-Te [12] to quantify imprecise and vague
evaluation and weight using decision conferencing
process. Further, Noor et al. [8] applied process modelling Table 4: Prior Researches of DSS in Tender Bidding/Tender Submission
to support real time communication between clients and
Communication-
Knowledge-
Document-
Tendering
Processes
Driven
Driven
been proposed to determine budget estimation and risk
Model-Driven
Linguistic
Data-Driven
Knowledge-
Bid Reasoning
Document-
Tendering
Processes
Approach [12]
Driven
Driven
Driven
Model [7]
Submission
Case-Based
Reasoning and
Linear Utility
Function [17]
Decision NIL NIL Schedule and NIL
Tender Specification Preparation
4.3 Tender Assessment Further, extensive researches have been done in model-
driven approach. As early as 1995, a prototype of DSS
Tender assessment is the most crucial stage in tendering was proposed for contractor prequalification where they
processes and has gained extensive study from researchers used performance assessment scoring system to evaluate
in terms of the implementation of DSS technology as performance, management capability, reputation,
resources, progress, competitiveness and activeness
Table 5: Prior Researches of DSS in Tender Assessment separately [20]. Sirajuddin and Al-Bulaihed [23]
transformed criteria measures provided by each contractor
Communicat
Data-Driven
Knowledge-
Document-
ion-Driven
Tendering
Processes
Model-
Driven
Driven
Driven
Multi criteria utility theory model has been proposed to
evaluate diverse set of criteria for contractor selection [25,
26]. Multi criteria decision model using AHP was applied
NIL Web- NIL NIL NIL
for contractor selection where several criteria and sub
Screening
based
Prequalifi criteria were equally analyse hierarchically [27]. It was
cation [6] also proposed for contractor selection in Turkey where
Web- Database NIL Performance Case-based contractors were required to pass two stages of evaluation,
based sub Developm Assessment reasoning bid price and prequalification threshold filter [28]. In
contractor ent for Scoring [31] addition, similar model also was proposed by Al-
Evaluation Tender System [20] Hybrid of dughaither [29] to tackle contractor selection problem in
System Evaluation
Tender Assessment
Criteria [33]
Utility Binary 4.4 Contract Monitoring
Theory [25, Goal
26] Programmi Contract monitoring is to regularly checks on the
Analytic ng Model
[34]
contractor performance and progress of running project
Hierarchy
Process [27- Support after awarding the contract. Several researches have been
29] vector delivered in communication-driven, data-driven and
machine knowledge-driven approach accordingly as shown in
[35] Table 6. Deng et al. [3] used Internet technology as the
depicted in Table 5. It can be divided into two sub phase communication platform and developed to support project
namely screening and evaluation. Screening is the process monitoring activity. The modules including data sharing
to ensure each candidate complies with minimal threshold using File Transfer Protocol (FTP) and Telnet, information
before proceeding to comparative evaluation. Noor exchange by email, Internet chat for real-time
Maizura et al. [6] implemented Web-based technology communication, live video-cam, and search engine for
with Javascript approach to control sufficiency of data collection purpose. Further, database technology is
supporting documents attached. applied to store, query, display, and analyse data on claims
for additional payments and time for completion of
Meanwhile, evaluation phase for communication-driven
approach, web-based approach facilitated information Table 6: Prior Researches of DSS in Contract Monitoring
transfer and collaborative environment between
Communicatio
Model-Driven
Data-Driven
Knowledge-
n-Driven
Driven
Driven
case-based reasoning [31], genetic algorithm and neural transfer monitoring Control
system [3] claims and System
networks [33], binary goal programming [34] and support time [9] Based on
vector machine [35] to predict contractor performance. All Project Data
these mechanisms train their analysis based on historical Performance Mining
evaluation datasets. Management [18]
System [14]
IJCSI International Journal of Computer Science Issues, Vol. 7, Issue 2, No 1, March 2010 42
www.IJCSI.org
ongoing project [9]. In similar approach, Cheung et al. Despite of the existing Web-based application, current
[14] made use of Web-based and database to manipulate approach requires users to manually go through the
data on current ongoing project by plotting graph to documents, check and evaluate the consistency of
compare and measure performances. Meanwhile, data information in these documents with the information
mining approach is integrated with DSS model to control provided either in the compulsory documents or database.
and analyse cost of a project in order to determine project Current web-based tendering processes faces limitation in
performances, predict trends and support in decision- verifying tender documents in which tender documents
making [18]. need to be reviewed through computer monitors or in
paper-based format [43, 47]. Hence, a framework is
necessary to automatically detect outlier specification in
5. Current Issues terms of syntactic and semantic contents of supporting
documents with respect to contextual application.
The exponential growth of unstructured information lead
to the necessity of devising strategies to improve and
enhance individual and organizational decision-making by 6. Conclusion
associating with automated tool in decision systems [75].
It is one of the current research challenges in DSS since Traditional tendering processes in construction industry
the standard tools designed for structured data analysis. are complex and fragmented. This paper summarizes
Traditional DSS lack of capability to confront with current practices of general tendering processes around the
dynamics and ill-defined data. Current existing decision world such as Unites States, Europe, Middle East and
support tools in construction tendering processes are Asia. Related researches on DSS in tendering processes
focused on quantitative data processing where the systems have been successfully reviews in this paper. The benefit
are specifically analyses factual values. Quantitative of decision support has attracted various researchers to
system could not directly scrutinize exact problem implement the system in tendering. Despite efforts to
structure from text. According to Froelich & Ananyan integrate and transform the whole construction tendering
[76], current challenges in decision-making requires processes into electronic or digital form by using Web-
comprehensive analysis of large volumes of both based Technology, the use of unstructured documents
structured and unstructured data. either in hard copy or digital could not be neglected in
daily business processes especially for recording,
Issuing free text documents either in paper or electronic authentication and information exchange purposes. Large
forms (i.e contracts, policies, catalogues, certificates, volumes of unstructured tender documents need to be
transcripts, financial statements, surveys, medical reports) analysed. It is the biggest challenge to automate the
are inevitable in daily business for auditing, analysis using computerised tools. It becomes harder when
authentication, information exchange and recording to automatically convert unstructured data to structured
purposes [38, 77-79]. A survey conducted by Building format data for input in decision-making processes.
Cost Information Services (BCIS) on [80] showed that
despite of active electronic tendering practices, document The need to extract and represent information in machine-
in hard copy is still required at the end of the process. It is readable formats becomes obvious. In order to automate
because users prefer final documentation in black and the tendering processes, integrating ontology in DSS
white copy. Furthermore, there are potential limitations in model seems to be a promising approach. We proposed a
web-based implementation as it is designed to solve framework of ontological-based extraction for decision
specific application in which human effort is needed to support system in order to improve tender assessment
maintain and modify the changes either interface or process. For electronic government, as far as we are
process with sufficient programming skills. The dominant concern, none of the research has been found to use
use of paper-based approach is also due to the fact that ontological modelling as part of decision support
Web-based applications do not meet the technological components. For the future research, we intend to
demands of end users to improve the whole processes [77, construct domain ontology for tendering processes using
81]. standard methodology for ontology building. The ontology
will represent rule-based for supporting decision-making
Supporting documents or attachments or appendices are process.
essential in order to verify and acknowledge the
information provided in the application. For example in
Web-based tendering processes, client side form
validation with Javascript approach is proposed to validate
the sufficiency of the supporting documents attached [38].
IJCSI International Journal of Computer Science Issues, Vol. 7, Issue 2, No 1, March 2010 43
www.IJCSI.org
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