The third in a series of articles on the delivery of BMCSs to our clients.
Also read
Specifying Control Systems 
Control System Technologies,
and the series introduction BAS or BS?

In the previous articles we have determined what technology we want and have assembled a specification that reflects said technology. Now we have to put the project out for tender.

In this article we will examine strengths and weaknesses in the tendering process. We will look at the different methods of tendering, and we will also consider under whom the BMCS should be contracted.

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Generally, what we are considering is trade-offs. The more thorough the design the better the tenders will reflect the wants of the client. The more detailed the tendering process, the more information the client and consultant receive. This allows them to make a better-educated decision. However, it is time consuming to analyse tenders and therefore the client pays a higher cost for this analysis.

As well, the practical decision has to be made who will carry the BMCS subcontract. The BMCS contractor can be a subcontractor of the mechanical contractor or the BMCS contractor can be direct subcontractor to the builder (general contractor). As we move towards the BMCS being the centre of an integrated intelligent building, where the BMCS controls more and more systems, such as lighting and access control, there become compelling reasons to remove the BMCS from the mechanical subcontract.

Influences on the Tendering Process

Okay, let's start with the basics. What is the purpose of tendering the BMCS? The intent is to get BMCS contractors who can meet the requirements of the specification to put in the most cost competitive price they can. Then, in an ideal honest and fair world, the low bidder would secure a contract to execute the work.

Owners wish to receive the highest quality BMCS system available. They want that system to fit into their existing operation. They want a system that suits their need for the current project for the lowest possible price.

What factors affect the pure tendering process?

Well, first, high in the client's mind must be the fact that BMCS systems and contractors are not all equal. If selecting the best contractor is the only consideration, there may be only one contractor and/or system that the client wishes to nominate. In this case they will wish to negotiate the BMCS directly, or if they have a high degree of trust in the BMCS contractor, have the contractor be named as the only option in the specification.

Second, specifications are not perfect. Rarely are they written only for the needs of a single contract. Consultants usually have a generic specification that they (may) modify to meet the needs of the project. If the specification has been written specifically for the given project, and the specification contains the items we discussed in the last article, then it may be possible to simply tender the BMCS as part of the mechanical package.

Third, the tendering process is only designed to secure the lowest cost. The tendering process is a tough as nails process and the mechanical contractor and builder have price as their foremost consideration. They care not a whit if a system works as long as they get through the defects liability (warranty) period and get their money.

The educated client will wish to have some influence in the selection process as they are going to have many years to consider the strengths and weaknesses of their system. The client may wish to evaluate initial price differences versus performance and long-term cost.

Having tenderers bid strictly to a specification to ensure balanced bids has direct negative consequences. Innovative companies cannot introduce new technologies because consultants are loath to specify features that other bidders cannot meet. As well, some specified feature that has a minor benefit to the client may be very expensive for some contractors to implement. It is difficult for the tenderer to convey options to the client.

Tendering Procedures

[an error occurred while processing this directive]There are a myriad of methods of tendering a BMCS. Generally these options have trade offs. More information in the tender is better, but more information means more work evaluating tenders.

There are two basic considerations: The form of tender and who will retain the contract with the successful tenderer.

First, the three general forms of tendering are: 

1. Competitive tender where the BMCS contractors bid to plans and specification. 

2. Proposal call where the BMCS puts forward the best solution they can design for evaluation of cost and performance against their competition. 

3. Negotiated price where the BMCS is directly negotiated with the owner, consultant, or design and construct team.

Second, the possibilities for contract award are: 

1. Have the BMCS as part of the mechanical tender and awarded by the successful mechanical contractor. 

2. Have the BMCS tendered separately and nominated to the mechanical contractor 

3. Have the BMCS tendered separately and have the BMCS subcontract directly to the builder (general contractor). This raises questions as to demarcation lines of responsibility between the mechanical contractor, electrical contractor, and the BMCS contractor.

There are additional possibilities that mix and match the above options. For example, The author feels the optimal solution for the client generally, is to have the BMCS contractor bid direct to a fixed design with tender form options to show differences in technology. The mechanical contractor shows price variations for the client to control the selection of BMCS contractor. This system allows the owner and consultant to retain some control over the selection and technology yet allows the BMCS contractors to nominate preferred contractors. The below form was used on a recent project to allow competitive tenders from all firms and allow mechanical contractors to nominate preferred subbies (subcontractors), while retaining the option of selecting open protocol.

Example Tender Form Design:

BMCS Technology Options

A - Native BACnet at front end, Primary Controllers, and all Zone Controllers. No proprietary intelligent equipment. 
B - Native BACnet front end and Primary Controllers. LonMarkâ controllers for all zone controllers. 
C - Native BACnet front end and Primary Controllers. Some level of proprietary zone controllers 
D - BACnet gateway to proprietary system. 
E - LonMarkâ certified controllers and flat Lon network. 
F - LonWorksâ for all intelligent controllers. 
G - Proprietary throughout or Other.

The client will show preference for compliance in the above order and reserves the right to select preferred system based on cost variation and compliance.

For Options B, C, and D the contractor must allow for all BACnet engineering to map every input, output, schedule, alarm, variable, and trend log in the complete BMCS to a BACnet Ethernet or BACnet IP interface, and to receive every BACnet point the client wishes to view on the nominated graphics interface. 

Tendering Process Options

[an error occurred while processing this directive]Let's look at Proposal Call and Competitive Tender, the two basic methods of tendering a project, and consider the pro and cons of each: 

Proposal Call
The controls price is removed from the tendering of the prime contract. The owner receives proposals from selected controls contractors and assigns the controls contract of the successful controls contract to the successful mechanical contractor.

Pros
 - Provides the best evaluation and value received for money spent of any form of tender. 

Cons
- Consultant's time and fees and owner's time required evaluating proposal calls. 
- If the owner has a significant preference for a specific system, it is unfair to ask other control contractors to prepare extensive proposals just as a "check price" to keep the preferred contractor in line, unless the control contractors are advised of their chances in securing a contract. 
- Proposal call for controls contract. The owner and consultant set a level playing field standard to evaluate the relevant merits of each proposal, and compare these against the owner's specific needs based on existing sites and specific owners needs. 
- A balance is required between giving the contractors a free enough hand to propose their most effective solution and ensuring that the proposals are a similar enough that they can be evaluated without an unreasonable amount of work on the part of the consultant. 

Competitive Tender 
In competitive tenders the approved controls contractors submit tenders to the mechanical contractors. The tenders are based on meeting the consultant's plans and specifications. The end selection of the controls contractor rests with the mechanical contractor based primarily on price, but at the contractor's discretion, upon whatever factors he feels are pertinent. 

Pros
Owner receives the lowest possible price. Every control contractor has an incentive to estimate the lowest possible allowance for the contract. 

Cons
- The owner has no control over what BMCS system he receives and the appropriateness of the system is limited to the standards of the consultant's generic specification. 
- Control contractors will design the most inferior system that meets the specification. 

Discussion

Mechanical and electrical consultants prepare plans and specifications. When preparing their specifications they have to write them so that they are not proprietary. The specifications must have enough leeway to allow for a variety of different styles and architectures in the design of the BMCS system. Different vendors approach the market completely differently depending on the strengths and weaknesses of their system. Factors such as whether their system is firmware based, whether they have concentrated point densities, whether they have cheap zone controllers, or whether they can handle analogue outputs with their zone controllers will all determine the way they approach the project. 

Controls manufacturers often ignore the intent of specifications on the argument that their system handles a requested feature in a different manner than specified; Thus, the requested feature is not relevant to their tender. 

BMCS systems evolve within each manufacturer. At a given points in time manufacturers will leap frog past each other as they bring in new product utilising new technology. Therefore, the consultant has to consider varying system architectural styles and stages of technology. At what point does a consultant decide to rewrite his specification? At what point does he decide to remove an approach that has become outmoded according to one manufacturer? At what point does he decide that a new technology has been tested in the market place and is generally accepted. 

A tendered process invariably allows each project to be contested by "low bid" contractors. The requirement then becomes the ability to analyse the "low bid" contractor's equipment, support and technical ability to execute the installation properly. In a pure tendered situation, where price only is given, the client and consultant are typically hampered by the appropriateness of the specification and the interpretation of the specification by the respective contractor. There is no opportunity for the consultant to analyse or affect the quality and/or scope of the proposed system beyond the compliance with the specification. In this situation, clients often get something less than expected and always get surprises down the track, such as large and restrictive maintenance contracts. 

Control contractors are obliged to estimate to the lowest cost possible to put them in the best competitive position. Therefore, they design the cheapest system that meets the criteria of the specification. This would be fine if the specification could be accurately written to reflect each manufacturer's capability and the client's needs for the specific project. As previously explained, it is not feasible for engineers to customize detailed technical specifications for each project. 

When an engineer attempts to write a comprehensive specification that covers all manufacturers in all situations he may actually hinder control contractors from applying the most effective solution for a particular project.

Contract Award

[an error occurred while processing this directive]The client needs to determine how the BMCS contract will be awarded. As noted earlier, the more exact the specification, the more suitable it will be to have the mechanical contractor award the BMCS contract directly. This allows the mechanical to select a contractor that they have confidence will meet the technical requirements and who will execute the contract to their satisfaction.

However, as BMCSs are complex and there are long term consequences beyond cost and construction, the client and consultant may wish to have the right to nominate the BMCS contractor.

As we move to more integration of intelligent systems, it makes more sense to have the BMCS contract placed directly under the builder. This allows the integration of systems that normally fall under different contractors, such as lighting, access control, air conditioning (HVAC), and power management. This is not possible when the intelligent systems are subcontracted to multiple contractors, namely the mechanical and electrical contractors.

Summary 

BMCS control is a component of the mechanical system that will be of ongoing concern to the owner over the life of the building. Often the selection of the controls contractor should be taken out of the hands of the mechanical contractor whose selection criteria is mostly price driven. Where there are long-term implications of the selected system, the selection of the controls contractor should be in the hands of the client and the consultant. However, this must be balanced against consultants' costs. If the consultant is asked to invest too much effort into the selection of the controls contractor then their fees will need to be adjusted to compensate to reflect the extra effort it takes them to make the analysis. 

As well, in complex systems such as BMCS, prescriptive specifications tend to limit innovative technology and fail to recognise differences in system architectures. In the end result, clients need to discuss with their consultant to determine how much customisation their BMCS specification justifies, and to decide how to best tender the project.

Next month, now that we have designed, tendered and selected our BMCS contractor, we will start our look at the construction process.

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