Whether it is purchasing products or contracting services, we evaluate Bids. This critical decision-making process has two fundamental requirements: Objectivity and Transparency.
Many studies have shown that subjectivity (the opposite of objectivity) is the dominant factor in the decision-making process. Subjectivity by-omission is ignorance or incompetence, while intentional subjectivity represents a lack of professional integrity. Both can lead to undesirable, even catastrophic, consequences. As long as human beings make decisions, there is no way to eliminate subjectivity in its entirety. We must strive to minimize the subjective influence.
Transparency, the second requirement of today's decision-making needs, is defined as clarity of a process that conforms to established audit principles. For example, when large public projects are tendered; government agencies are cognizant of political-pressure, bribery, and nepotism. The responsible organization has to ensure the selection process is transparent. Yet, interest groups try to influence the final decision, usually through highly subtle ways. Further, after the decision is made, if it is not transparent, non-winning candidates or special interest groups may attack, accuse, or even initiate legal proceedings.
Indeed, even if the selection process is subject to strict monitoring, proving this to the public and to legal authorities is a daunting task.
Most companies start by assigning an in-house expert (or a consultant) to develop a Scope of Work. This coordinator will identify the criteria for the evaluation, define prerequisites and might even recommend a list of bidders (candidates). Even though the coordinator is not an expert in bid evaluation, almost always he/she coordinates the entire process.
Held Hostage By The "Matrix" Method!
We can breakdown the "Matrix" method to the following steps.
Identify relevant criteria
Assign criteria weights
Compare the candidates as a group, for each criterion, and assign points to them
Multiply the points by their corresponding criteria weights
Add the totals for each candidate to rank them.
Until now, the "Matrix" method has been the only option available to evaluate bids, even though it is woefully inadequate.
