Research reveals that there are a myriad contractor's pre-qualification criteria's that must be met before one is considered a qualified contractor. This thorough vetting and selection process of the contractors helps to create and build confidence in the clients. The clients will be assured that they are dealing with qualified contractors who are able to achieve the desired goals.
It is imperative that before a contractor or supplier is contracted to deliver certain goods or services, they are thoroughly vetted t ascertain the level of their experience, reputation of their work as well as the quality of their work. The contractors or suppliers to be contracted should also be able to perform the allocated tasks on a timely basis.
Furthermore, researchers support the fact that procurement should be left to the procurement committee that needs to be present in most major organization. The procurement committee or department is likely to be sterner towards the contractor selection process.
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This reports aims at evaluating the financial stability of the suppliers based on certain parameters such as the net assets, earnings, debt quality, among other pertinent parameters. Likewise, the auditor's report should also be used to evaluate the financial worth of the suppliers. The main parameters that are used to determine the suppliers and contractors to select include the experience of the contractor as well as his reputation and the quality of his work. Moreover, the contractor needs to have more than 3 years experience and able to deliver quality results on time.
Health and safety
It is imperative that the selected contractor adheres to the various health and safety legislations as stipulated by the law. This is an important consideration in the recruitment process. The contractors should continuously ensure that they monitor and review both protective and preventive measures necessary in the performance of their jobs.
The contractor is further charged with the responsibility of minimizing operational losses as well as occupational health problems and accidents within their operating environments. Accidents will effectively be averted through observance of the right set of policies and practices that are prescribed by the law.
The selection criterion should be effective so as to evaluate the ability of the contractor to handle functions and tasks during worse times in the company's history. Good reputation will install confidence in companies to deal with a particular contractor. Moreover, the positive reputation helps to bolster the confidence of the stakeholder such as the employees, investors and the general public.
This facet identifies the technology innovation necessary for the performance of a particular task or function by the contractor. The contractor should be sure that these technology innovation techniques make positive impacts in terms of the cost, quality and on-time delivery of the service that has been requested.
This is perhaps the most imperative parameter which will determine whether the contractor will be granted the contract or not. The company should spend a lot of time reviewing the contractor's quality assurance programs and their contributions towards the deliverance of quality projects.
Work Load / Capacity
This is an indicator of the contractor's workload and capacity to work on projects within a realistic time frame or schedule. There is a general requirement that the bidder's contracted overload should indeed not be more than 150% of the total workload within a one year period.
The contractor should be able to know when to recruit additional staffs so as to meet the staffing requirements of the project where there is work overload.
The contractor needs to have more than 3 years experience in providing commercial plumbing service. The requirements that contractors have at least 3 years experience does not serve to bar entry of other contractors or players into the market, but merely to gauge the quality of work that the contractor pledges to perform.
Researchers concur that the tender price should not be used to finally determine the contractor to be selected. In essence, the tender price merely helps to give the contract value and provide a benchmark in monetary terms upon which the client is to pay.
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The tender price is also known as the capital cost and continues to be the determining factor in the final stages of selecting the contractor, despite the advice by scholars that this is likely to have adverse effects on the contractors.
Comparison of Supplier selection criteria with selected projects
Project 1: Installation of HR & Payroll Application
The HR's main concern was the tender price of the contractor and therefore they ended up choosing the contractor who quoted the lowest tender price. The main reason for this was that the project was urgently required. It was later discovered that the selected contractor delivered low quality software. The company subsequently tested the software prior to making an official order of the same. The supplier could not perform the required software modification.
Project 2: Installation of Fingerprint, Time Attendance & Access Control System Model
Here, the project manager was mainly concerned with installing the latest technology in Fingerprints Systems. Researchers revealed that the state of technology is key in the selection process of the supplier. Therefore, the project manager managed to get the project up and running and in good time after the selected supplier installed the tight technology.
Project 3: Providing Call Centre System
Under this facet, the supplier was selected on his reputation. Scholars reveal that it is imperative to establish the image and identity that the contractor has created in their market niche. The supplier was selected and he subsequently installed the gadget. However, after installing the gadget in good time, it was damaged. The supplier moved in swiftly to repair the damage within 2 weeks. This was in order to protect his reputation as an accredited supplier.
Project 4: Designing a website
Here, the project manager selected the best supplier based on the experience held by the supplier. Researcher back up the fact that only experienced suppliers should be selected. The supplier did not let done the project manager. He submitted innovative work in time.
Analysis of the organizational supplier choosing practices
The 1st project failed due to lack of a Purchasing and Contracting Division within the organization. The Purchasing and Contracting Division is charged with the duty to ensure that all purchases are done according to the requirements stipulated by the Bidding Procedures Contract. In the absence of the Purchasing and Contracting Division, each department within the organization selects contractors in accordance with their supplier requirements.
Most of the department selected the contractors based on the lowest tender price, but missing out on the vital issue of quality. The results were negative as one of the software installations was lost to damage due to poor workmanship.
Therefore, all procedures should be followed in the selection of the best contractors, based on their quality of services as well as low tender price.
Company: 2, 3 & 4
The 2nd, 3rd and 4th companies relied on a team of procurement experts to perform the selection of the contractors. However, there was still a problem since the contractor who submitted the lowest capital cost basically won the tender. The team of procurement officers set the requirements which are then vetted against potential contractors until the best contractor who is also cheap is selected.
It is therefore imperative for the procurement team to seek for the contractor who can deliver quality service on a timely basis while also providing the best tender price. The contractor to be selected must also meet the legal requirements as stipulated by the government. This will measure their level of compliance to the natural law of order.
The selection criterion of contractors should be based on the reputation of the contractor. Reputation can indeed help to dictate certain desired traits within a person. For instance, when the pipe that was fixed got damaged, the contractor came back and fixed it all by himself. Critics suggest that this is done mainly to help restore or better still build the contractor's reputation.
In cases where technological advancement is concerned, it is advisable for the selecting committee to consider selecting a contractor who can gain access to the latest technology in that given field.
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It should be remembered that experience and the tender prices should be the key parameters that all contractors should be subjected to before the final selection process. Organizations that do not follow these prescribed measures are putting their stakes at risk and are likely to spend a lot of money in using shortcuts that are often costly in the long run.
Suppliers and contractors are therefore required to meet the requirements of the organization to ensure that they are constantly contracted by the organization. The main aim of this is to ensure that only quality suppliers and contractors are granted contracts of service with company or organization, hence ensuring safety of the projects.