External Providers/Suppliers’ Evaluation: Quality vs Price

Questions have been raised on the PIE (Pan Island Expressway) work site collapse of a 40m segment of a viaduct being constructed at Upper Changi Road East, killing one worker and injuring 10 others on Friday morning, 14July. 

While the authorities are investigating the accident, many questions have been raised about the tender process and the award of the project to contractors.

One critical question asked was: Why did the Land Transport Authority (LTA) award the contract to build the PIE-TPE viaduct to Or Kim Peow (OKP) Contractors? Was it based on OKP's lowest bid?

According to reported news, OKP submitted the lowest bid of S$94.6 million for the tender for the Design and Build contract in November 2015, which was 27 per cent lower than the next lowest bid of S$129.7 million by Yongnam Engineering.

Although an LTA spokesman said it considered more than just pricing alone in assessing tender proposals, citing other "quality aspects", such as the relevant experience of the participating contractors, their safety management systems and practices, track record, project-specific technical, risk management and resource management proposals.

For all construction tenders, LTA said the price-quality method is used by agencies as a framework. The price-quality weighting used for Design and Build projects before January last year is between 60:40 and 70:30.

Obviously, LTA’s price-quality methodology is questionable as it places higher weightage on pricing than quality. Sad to say, this is nothing new as such practices are still commonly practiced in many industries and projects in many countries.

After years of working in factories and manufacturing facilities, I observed that such practice rose from different objectives of various functional departments. The buyer buys at the lowest cost, the quality department wants to receive the best product quality that meets the specifications and the safety department demands zero accident from their contractors working inside their workplaces. More often than not, the department with the loudest voice and willpower wins.

 

Unless and until all functional departments are given common key performance indicators (KPI) on quality and safety aspects on service providers, suppliers and contractors, many would continue such practice with severe consequences like the accident illustrated here.

 

As top management are more concerned with bottom lines than other aspects of operations, the purchasing function is viewed more as a “cost-saving” function compared to “expense” functions of quality and safety roles. Until top management understand and learn the lessons of using the cheapest supply source, and faces the consequences of using incompetent providers, nothing would change.         

 

Read full article from The Straits Times, dated 16-07-2017

PIE work site collapse: Questions loom over collapse of viaduct segment

http://www.straitstimes.com/singapore/questions-loom-over-collapse-of-viaduct-segment?xtor=EREC-16-1[ST_Newsletter_AM]-20170716-[PIE+work+site+collapse%3A+Questions+loom+over+collapse+of+viaduct+segment]&xts=538291

 

ISO 9001:2015 Quality Management System: Release of products and services (8.6)

Speak Mandarin Campaign and NDP organisers apologise for linguistic errors

A version of this article appeared in the print edition of The Straits Times on July 12, 2017, with the headline 'Language gaffes: Two event organisers say sorry'.

One embarrassing mistake was in the use of the wrong Chinese character in a rostrum signIn a gaffe at Monday's launch of the Speak Mandarin Campaign, instead of using the Chinese character for "read", the character for "to show disrespect" was used on a sign that featured prominently.

In the NDP case, there were typographical errors in the Tamil translation of the theme #OneNationTogether, printed on the NDP publicity pamphlets given to Primary 5 pupils from 162 schools before they attended the NDP's National Education (NE) shows. The translation was supposed to read as "Let's come together as one nation". But in that translation, some letters were in the wrong places, while others were missing, making the words unintelligible.

These are but real examples of quality management system lapses causing embarrassments to the organizers. Generally, people cannot accept such lapses and anyone concerns about quality management processes can learn from such blunders.

One way to prevent such error is to adopt a quality management system like ISO 9001:2015 and implement processes to meet the standard’s requirements. One of the requirement, Clause 8.6 Release of products and services states precisely:

“The organization shall implement planned arrangements, at appropriate stages, to verify that the product and services requirements have been met.

The release of products and services to the customer shall not proceed until the planned arrangements have been satisfactorily completed, unless otherwise approved by a relevant authority and, as applicable, by the customer.”

The organization shall retain documented information on the release of products and services.”

In this context, the artwork supplier and providers would need to define their processes to deliver the final products. Normally the final artworks must go through internal and external checks and approvals before launching the printing and manufacturing processes to produce the final products. Records are maintained to include evidence of verification for conformity with acceptance criteria and traceable to the person(s) authorizing the release of the product. When a robust quality management system is effectively implemented, sources of error could easily be spotted, traced and fixed prior to delivery of the final product to the customer.  

Where all planned verification and checks have been carried out at various steps and yet nobody has spotted such errors, the only aspect for investigation to such lapses falls on the competency of personnel performing such verifications and checks. When personnel are not effectively trained to be competent to perform their roles and duties, lapses would occur. This competency aspect stipulated as another requirement in the ISO 9001:2015 Standard.

Clause 7.2 Competence in the ISO 9001:2015 Standard is an important element in the quality management system. It’s beneficial to read the content and understand its requirements for effective quality control.