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By STEVE TOUGH 1,324 views

E-tenders vs Traditional Tenders

Transparency, streamlined procurement process, and efficiency – are prominent differences between e-tenders and traditional tenders. With the rapid advancement of technology, e-tenders have become an increasingly popular method for procuring goods and services. The use of e-procurement can lead to cost savings of up to 30% and reduce the procurement process by 50-80% (Source- World Bank report).

However, traditional tenders, which rely on paper-based methods, are still widely used by many organizations. So, the question is, which one is the way of the future?  E-tenders or traditional tenders? On that note, we’ll take a closer look at the advantages and disadvantages of both e-tenders and traditional tenders and compare them to determine which method may be more suitable for different industries and organizations.

In India, government procurement has largely shifted online, and all government departments, PSUs, and organizations have to announce their goods and services procurement requirements online on the Central Public Procurement Portal (CPPP) or GeM (Government e-Marketplace) portal.

What are the advantages and disadvantages of traditional tenders?

Traditional tenders, also known as sealed bid tenders, are commonly used for procuring goods and services. They involve submitting a sealed bid in response to a publicly advertised invitation to a tender. However, while traditional tenders can be an efficient way of procuring goods and services, they also have some potential drawbacks.

Advantages of traditional tenders:

  1. Familiarity and comfort with existing processes: Traditional tenders have been used for a long time and many organizations are familiar with the process and feel comfortable using it.
  2. Reduced dependence on technology and internet connectivity: These do not require access to the internet, so organizations do not have to worry about technical issues or internet outages.
  3. Face-to-face communication and negotiation: These tenders allow for face-to-face communication and negotiation, leading to better understanding and decision-making.
  4. Physical tender document review: It can be reviewed by multiple parties and used as evidence if required.

Disadvantages of traditional tenders:

  1. Time-consuming: Traditional tenders can be time-consuming as the process is manual and requires the physical transportation of tender documents.
  2. Lack of transparency: It can lack transparency as the process is not automated and it can be difficult to ensure that all parties have access to the same information.
  3. Costly: It can be costly as the process requires the use of paper, printing, and physical transportation.
  4. Risk of errors: It is prone to errors as the process is manual and can be prone to human error.
  5. Limited access: It can be limited to the parties present physically and can’t be accessed remotely

How is e-tendering a better solution?

E-tendering, also known as electronic tendering, is a process of procuring goods and services through electronic means, such as online platforms, email, and other digital channels. It offers several advantages over traditional tendering methods, which rely on paper-based methods such as physical documents, mail, and fax.

Some of the advantages of e-tending include the following:

  1. Increased transparency: E-tendering provides increased transparency and fairness in the bidding process as all the bidders have access to the same information and can submit their bids at the same time. This ensures that the process is fair and open to all interested parties.
  2. Greater efficiency: It offers greater efficiency as the process is fully automated and eliminates the need to physically transport tender documents. This means that the process is faster, and organizations can save time and money.
  3. Cost savings: It can lead to cost savings as it eliminates the need for printing and mailing physical documents, and reduces the administrative costs associated with traditional tendering methods.
  4. Improved communication: It improves communication and collaboration among stakeholders as all parties can access the same information and communicate in real-time. This ensures that everyone is on the same page and that there are no misunderstandings.
  5. Remote access: It can be accessed remotely, enabling more parties to participate in the process, regardless of their location. This increases the pool of potential bidders and can lead to better competition and lower prices.
  6. Transparency of the process: It provides a transparent process, with the ability to track the progress of the process, making it easy to identify errors and rectify them.

Note- E-tendering is not without its own set of disadvantages, such as dependence on technology, internet connectivity, and cybersecurity risks. However, the benefits of e-tendering often outweigh the drawbacks and make it a better solution for many organizations.

E-tendering 2.0: How to stay ahead with the latest innovations

With advancements in technology, e-tendering systems have become more innovative, offering a range of new features and benefits to businesses.

Some of the e-tender innovations that businesses can stay ahead with include:

  1. Artificial intelligence (AI) and Machine Learning (ML) integration: E-tendering systems that incorporate AI and ML can analyze bid data, identify patterns and make predictions, which can help businesses to make better decisions and improve the overall efficiency of the procurement process.
  2. Cloud-based systems: Cloud-based e-tendering systems offer improved scalability, flexibility, and accessibility, as well as lower costs and easier maintenance.
  3. Mobile optimization: Mobile-optimised e-tendering systems allow businesses to access and manage tenders from any device, which improves mobility and convenience.
  4. Blockchain integration: E-tendering systems that incorporate blockchain technology can provide enhanced security, transparency, and immutability in the procurement process, by providing a tamper-proof record of all transactions.
  5. Real-time analytics and reporting: E-tendering systems that provide real-time analytics and reporting can help businesses quickly identify and respond to potential issues and make better-informed decisions.
  6. Secure e-tender document sharing and storage: E-tendering systems that provide secure document sharing and storage can help businesses to keep sensitive information private and protect it from cyber threats.

By staying ahead with e-tenders innovations, businesses can improve the efficiency, transparency, and security of their procurement processes. It’s important to note that e-tenders systems are constantly evolving, and new features and functionalities are being developed. Therefore, it’s crucial for businesses to stay updated with the latest e-tender innovations, and to choose a system that best meets their specific needs and requirements.

It can include researching and comparing different e-tendering systems, consulting with procurement experts, and piloting a system before fully implementing it. By doing so, businesses can ensure that they are using the most advanced e-tendering system available and can stay ahead of the competition.

Steve Tough