W3_APE_Selection The Winner for Quarry Bid Package

  1. Problem Definition

In early August 2013, we closed the quarry bid package after some clarification sessions with five Bidders after we received their proposals. The next thing to do is to select the best Bidder as the winner of this package based on parameters set up by Bid Committee.  


Figure 1

 Figure 1 An Example of Crusher Plant


  1. Identify the Feasible Alternative

There are seven parameters that we have to consider to select the best Bidder. Since the Management is demanding solid answer, then we have to use scoring code instead qualitative method. That is why we selected non dimension scale-weighing technique[1], [2] & [3] to do the assignment.  

  1. Development of the Outcome for Alternative

Basic procedure of this technique is numbering all parameters as score then getting the result. For quarry package, three parameters already in given by numbers and the rest is qualitative that require relative rank score. We have produced such table including the result present hereinafter:


Figure 2

Figure 2 Quarry Package Review

We also provide the simulation based on four important parameters for the package if we put them alternatively as relative rank one in weighing technique table (the major important parameters for quarry package are cost, schedule, local content absorption and environmental plan). The result of this simulation present in below:

Figure 3  Figure 3 Simulations for Priority Change

  1. Selection Criteria

The target of simulation is selecting the best Bidder based on seven parameters established by our Bid Committee as listed above.

  1. Analysis and Comparison of the Alternative

The first simulation which put cost as primary priority, we have company B as the best Bidder. Changing other priority will not change company B status except the score. It’s because the scaling unit of company B which is close to Client requirement even they only have partial environmental plan and their cost is not the cheapest one.      

  1. Selection of the Preferred Alternative

As the result from the simulation, definitely company B is the best Bidder for the quarry package and we can proceed to the next stage with them (negotiating and contracting).   

  1. Performance Monitoring and the Post Evaluation of Result

Two options available as discussion subject with the Management. If they accept company B as the winner then they negotiate to lower the cost after improving detail on environmental plan. If we want to keep company C as bargaining position with company B, then we have to improve geology & risk analysis presentation and schedule from company C.  


[1]agsm.edu.au. (2006). Multi Attribute Decision Making. Retrieved from http://www.agsm.edu.au/bobm/teaching/EIA/lect15-3.pdf

 [2]mycbbook.com. (2012). Decision Models: Compensatory and Non Compensatory. Retrieved from http://www.mycbbook.com/MYCBBook-Consumer

 [3]Sullivan, William G., Wicks, Elin M., & C.Patrick, Koelling. (2012), Engineering Economy (15th Edition. New Jersey, United States: Prentice Hall.



Filed under Arif P, Week 03

3 responses to “W3_APE_Selection The Winner for Quarry Bid Package

  1. Hi Pak Arif Sorry but as I am still in Shanghai, I am unable to access our blog to review your paper…….. My best suggestion would be to wait another 24 hours and I will be in Singapore and then I can catch up with any of the blog postings I may have missed……..

    BR, Dr. PDG, Shanghai China

  2. arifpermana

    Thank you DR Paul for your kind attention,   No problem, i can wait it. Since my plan is not for the blog, but to provide me some spare for start the paper tomorrow…..   Regards, Arif Permana

    ________________________________ From: Dr. Paul D. Giammalvo To: Simatupang AACE 2014 Cc: “simatupangaace2014@yahoogroups.com” ; “yanis@ptmc-apmx.com” Sent: Friday, 6 September 2013 9:00 PM Subject: [simatupangaace2014] Re: [New post] W3_APE_Selection The Winner for Quarry Bid Package

      Hi Pak Arif Sorry but as I am still in Shanghai, I am unable to access our blog to review your paper……..   My best suggestion would be to wait another 24 hours and I will be in Singapore and then I can catch up with any of the blog postings I may have missed……..

    BR, Dr. PDG, Shanghai China

  3. Again Pak Arif, you picked an OUTSTANDING case study and did a really great job with your analysis, but if you had only cited the specific chapter and pages of Engineering Economy, you could have claimed credit for all your Chapter 14 questions by now as well…..

    For the future in order to claim credit for your blog posting AND any questions from Humphrey’s or Engineering Economy, you need to cite the Chapter and exact pages, so I can double check to see if you are using the tool/technique correctly.

    Other than that, you are definitely doing a great job and your leadership by example is recognized and appreciated. As you are already quite a master of these blogs, I also will be looking to you as a mentor for those on your team who may be struggling with this assignment….. (The absolute BEST way to learn anything is to have to teach OTHERS)

    Dr. PDG, Singapore

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