L Company Bidding Implementation Process Risk Management Research

Along with development of the market economy and increasing refinement of the market competition mechanism, bidding as the mainly competitive purchase way is a common trade fair pattern being globally used by countries and international organizations among public purchase areas, and is also used in infrastructure, utility, social security as well as business and finance etc. areas. With the rapid development of bidding, numbers of agencies of bidding are also increased. However, due to time-lag and incomplete of relative laws and regulations, and irregular operation of some bidding agencies during the process of bidding implementation, some unavoidable risks may exist to the bidding agency during bidding process. These risks could produce certain influences in launching and managing bidding projects, and accordingly injure the multi-benefits of bidding projects.Based on the potential risks occurring during processes of bidding projects for bidding agencies, L Bidding Agency Co., Ltd (hereafter, L) was used as research object here to estimate the risks in process of bidding projects. Firstly, detailed processes of each bidding step were analyzed to explore potential problems in regular bidding projects, and possible risk hypotheses in the process of a bidding project were raised based on these problems. The related groups of a regular bidding project in L included four parts as tenderer, bidder, supervision department and bidding agency. The main process of a regular bidding project included:(1) preparatory phases with signing of tender agent agreement and drafting of bidding projects; (2) compiling bidding announcements and files; (3) organizing reconnaissance and question-answering; (4) establishing evaluation committee; (5) organizing bidding and evaluation meetings; (6) bidder calibration, results announcement and delivering bid notice; (7) assisting tenderers with contract signing and later inspection; (8) information arrangement, archiving and report, etc. The bidding department organized the whole processes of a bidding project with assistances from synthesis department, finance department and construction department. The analyses suggested that there were five aspects of potential risks that existed within processes of the specific bidding project, which comprised inner risks in process of bidding and in bidding management, and external risks in policy, economy and supplier. Among these risks, the risks in process of bidding project were divided into eight details as stage of preparation and establishment of bidding plans, stage of compilation and release of bidding files, stage of reconnaissance and preconference of bidding project, stage of construction of evaluation committee, stages of bidding opening, evaluation and calibration, and stages of contract signing and file archiving. Secondly, considering the occurring differences of risks among different stages during the process of bidding project and the variant influences of the risks, we arranged the potential risks with different grades and set the risks into different evaluation factors according to the varying grades. Practical investigations were performed among multi-party members who have relationships with the process of a bidding project, and statistical data were collected and analyzed to clarify the risks and influences of the risks during the bidding project in L. Statistical data of the actual investigations showed that 14 risks were found in the process of bidding project in L, which were suggested to be divided into five grades as exceptional risk, severe risk, moderate risk, common risk and minor risk. The exceptional risks mainly happened during the stages of compilation, release of bidding files, and bidding evaluations; the severe risks mainly included the risks in the stages of preparation and establishment bidding plans, in the project management caused by system and framework of the company, risks that were caused by financial management, and risks in policy; the moderate risks mainly occurred during the stages of contract signing, file archiving as well as being caused by the suppliers; the common risks were mainly found during the stage of bidding opening, and in relation to human resources during the bidding management; the lowest risks were mainly included in the stages of the reconnaissance and preconference of bidding project, construction of evaluation committee, bidding calibration and economic risks. Thirdly, for the risks that were clarified by our actual investigations, final solutions were proposed with integrations of considering previous references and related information collections. The final suggestions, such as risk aversion, risk mitigation, risk transference and risk acceptance, and integrations of all these aspects, were suggested as basic responses and solutions to the potential risks that might happen during the actual processes of bidding projects in L.As one of the most important challenges in the global bidding industry, risks finding and management are closely related to the survival and development of an enterprise. Aiming at this hot issue, this research used multiple methods such as actual investigation and data statistics to explore and raise the potential risks that may exist in the bidding industry, and gave corresponding suggestions and solutions to the risks. These solutions may provide efficient implications for management and development of the bidding related industry.