I have to wonder after reading this recent article on the power of online real-time bidding in The Global Graft Report. The article described Chile’s procurement system which goes beyond the simple e-tender submissions common in Canada and the US and actually uses real e-Procurement functionality, including real-time, public e-auctions.
Chile’s system is simple and cost-effective. Government agencies submit a projection of their needs to a website. It compiles a list of the requirements and then invites suppliers to bid. Their proposals are concurrently submitted to the website, where all bidders and the general public can see what’s offered. The real-time aspect of the program allows suppliers to adjust their bids depending on what other bidders are offering, spurring more competition. At every step, the process is completely transparent.
That’s the way it should be. Not a one-time sealed bid submission against a probably incomplete specification, with the award going to whomever is the lowest cost among the suppliers deemed competent to “deliver the goods”. (Which allows corruption to run rampant in the hands of the less than worthy, who can judge who is and is not competent to deliver without consequence.)
Especially now that modern systems can handle bid packages as complex as you want them to be! And hey, as the Swedish Public sector found out, if you throw optimization into the mix, you can truly get optimized auction results.