Developing Strategies on Construction Project Tendering Website - Case Study on Sichuan Construction Net

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1 Developing Strategies on Construction Project Tendering Website - Case Study on Sichuan Construction Net LI Jingjing SHAO Peiji School of Management,University of Electronic Science and Technology of China, P.R.China, Abstract: How to formulate the development strategy of the construction projects tendering websites realizing sustainable development is not only one of the important problems to the websites operators but also a new problem in the field of business administration. In this article the construction project tendering websites operation under the current environment are analyzed by means of SWOT. Following are the four respects: the strengths, weakness, opportunities and threats of the website of Sichuan Construction net. Two development strategies are proposed based on the SWOT analysis. One is to construct comprehensive electronic platform and change the Sichuan Construction net to the leader of construction industry informationization. The other is to strengthen the influence of brands and to build the trade information resources platform that designed interests of various fields such as government, construction enterprises, bidding agencies, the construction material distributors, and experts to win together. Key words: E-tendering; construction projects; SWOT; strategies 1 Introduction With the market development of engineering construction projects invested by government, tendering management standardization is requested to be more and more urgent. Tendering operation pattern has gradually developed into the main government procurement form. Government promulgated the related law such as "People's Republic of China Construction Law", "People's Republic of China Tendering and bidding Law", "Electronic Signature Law" and so on. Along with the information technology development, the electronic commerce application gradually seeps to each domain of social economy life. Therefore how to effective utilize information technology to realize the entire integration of tendering procedure already become an important research question. According to the 16th rule of "People's Republic of China Tendering and bidding Law" tender who select the public tender method must issue the tender announcement. And the tender announcements of projects which must be carried by the tendering form according to the rule of related law should be issued on appointed media such as newspaper, information network or other media. When we input keywords such as "tendering website into the Baidu search engine, we may discover many issues about tendering information website. In these websites, some are appointed media, including nation appointed media, local government appointed media, industry professional department appointed media and social organization appointed media etc. On 17 July, 2006, the domestic first case that China Bidding Net ( prosecuted China Project Bidding Net ( about malfeasance competition and encroaches upon China Bidding Net copyright dissension has aroused the widespread interest of social persons from all walks of life. It also partially reflects that there still have many problems in the tendering websites development and the standardized management. At the same time, how to grasp the right localization in the intense market competition and formulate development strategy also causes many tendering websites managers recognition. This paper takes the Sichuan Construction Network ( as the case analysis, uses the SWOT method to carry on the analysis to the Sichuan construction network, and distinguishes tendency, strength and condition which have latent influence to the development of Sichuan Construction Network. It enables the website to melt the threat which weakness brings to the greatest degree and fully displays its superiority, grasps the opportunity, further consummates construction 672

2 market and the engineering construction market system, enhances the international competition strength. This research not only has the good economical significance, but also has the important social significance. 2 SWOT analysis of Sichuan Constructs Net SWOT is one mature market analysis method. It could be widely applied in enterprise management, project management and individual competition and so on. SWOT is the first letter composition of four English words: Strengths, Weaknesses, Opportunities and Threats. The SWOT analysis was firstly used in marketing management for analyzing products and expanding to industry and market analysis. The well decision would be made by getting all relative information. This method has been widespread obtained in the strategic management. [1] [2] [3] 2.1 General situation of Sichuan Constructs Net Sichuan Construction Net was establishes in Oct, On 26, Oct, 1999 Sichuan province government authorized to establish Sichuan construction projects management transaction information network. On 17 Feb, 2001 Sichuan province government changed the website s name to be Sichuan Construction Net according to the development situation. At present Sichuan Construction Net set up eleven channels, two special areas (member special area, administration permits special area), and seventy columns. About four hundreds daily information is issued on-line every day. The date visit quantity is more than 30,000 people per time. The website is supported by seven departments. 2.2 The strengths of Sichuan Construction Net (1) Government correlation department support Sichuan Construction Net is a industry portal website supervised and directed by Sichuan province development and reform committee, Sichuan province construction bureau, Sichuan province supervision bureau. In Dec, st bulletin put out by Sichuan province development and reform committee assigned Sichuan Construction Net for exclusive network media to issue entire province legally project tender announcement. In Dec, nd bulletin Sichuan province development and reform committee appointed Sichuan Construction Net to be the exclusive media for to issue the entire province legally tender candidate. In Feb, 2000 Sichuan province government assigned Sichuan Construction Net for the carrier of Sichuan construction market related enterprise and the specialized technical personnel credit records system. In 2004 construction enterprises and engineering exploration and design enterprises credit records information management system was firstly start up and built. At present time in entire province 90% construction enterprises and the engineering exploration and design enterprises have established the credit records. Its dynamic management maintenance will apply to the tendering process of construction projects invested by Sichuan province government. (2) Advanced technical equipment, high quality service and diversification products Sichuan Construction Net mainly has five big functions. They are information issuing, information inquiry service, Information service, software exploitation and technical support. Information issuing service is to issue project setting up information, to issue tender announcement, to issue selected candidate list, to issue selected result, to issue policy laws and regulations, to issue enterprise authorization, to issue each kind of registration practitioner authorization training information, building materials quotation and to issue test grade and so on. The information inquiry service includes setting up project searching, tender information searching, selected candidate list show, policy, laws and regulations searching, construction market enterprise searching, each kind of registration practitioner authorization searching, specialized database inquiry and building materials quotation and so on. Information service includes advertising service, mobile phone short message service, mobile phone WAP service and BREW service. The software exploitation mainly means the exploitation of Sichuan province expert warehouse system, Sichuan province construction market credit records system, Sichuan province construction bureau administration permitted system, Sichuan construction enterprises authorization yearly examined system, Sichuan government business information system, investment project CALS (Continuous Acquisition and Life-cycle Support) system and other kinds of government, 673

3 enterprise website application system. The technical support mainly has Sichuan province expert warehouse system, technical support Sichuan state-owned investment project tendering information issued in network technical support, the entire province construction enterprises network authorization yearly examined technical support, Sichuan province construction market credit records system technical support, Sichuan province tendering surveillance network technical support, Sichuan province executing laws surveillance network technical support and other provinces constructs net technical support. (3) Outstanding management team, technical talented person and advanced management principle The members of manage top team of Sichuan Construction Net are experts with rich carving out and business administration knowledge and experience and they are familiar with industry integration institution. They also has the quite clear plan regarding the website overall development. The middle-level administrative personnel of the company have solid specialized foundation and business management knowledge and the experience. The software and hardware experts have the rich experience to the software and hardware function expansion and development and they have the quite defined mentality to promote the implementation. (4) Have unique resources Sichuan Construction Net has many members including more than one thousand construction enterprises and more than three hundred tendering agencies. At present the amount of experts in Sichuan province expert warehouse system is already 10,200 people, involved fifteen big national economies industries, more than 180 kind of specialties and it is basically satisfy the Sichuan province construction projects tendering application. The network termination covers the 21 cities of entire province, 19 counties dredge the network termination and the accumulation amount of dredged network termination is already 43. More than ten thousand projects used this system to select experts, and the accumulative total experts are more than 164,000 people. This system walks in the national front row because of its system innovation and standard management. It has become an important foundation resources database in Sichuan province and it plays vital role in E-tendering process. 2.3 The weakness of Sichuan Construction Net (1) The website needs massive funds investment because it needs to expand the content and the function according to the user unceasingly expands need and technological development. Simultaneously in the promoted implementation, it also needs massive funds strut. It is an very important question relative the website survival and development that how to effectively finances. (2) The business process reengineering of E-tendering flow has not launched. The business model of E-tendering has not been obtained massive utilization. The E-tendering website is now in the start and reforming stage. (3) The service quality level of individuation service based on the classified mechanism faced to customer is low. And the depth of provided information and service is insufficient. (4) Because Sichuan Construction Net is the emerging industry website, the relative managerial experience is less, and there has not realistic pattern to be followed. The anticipated risk and profit are indefinite. Although we could use foreign countries especially developed countries for reference, the website management still has a bigger risk as a result of the Chinese special environment development change. 2.4 The opportunities of Sichuan Construction Net (1) Compared with many other countries most of the construction projects are invested by the government in China. According to the statistic data from Statistics Bureau of Republic of China ( in 2005 the amount of national fixed asset investment was billion Yuan, and in which billion Yuan had been invested to construction and installation projects. For example Sichuan province government arrangement 300 items key projects. The total investment engineering construction projects is 8367 billion Yuan, and the annual plan investment is 625 billion Yuan in 2006 year. According to the data of Sichuan Construction Net ( about 2700 projects were carried on tendering process every year. The amount of each project is from 2 million to 30 billion, and in which construction projects tender account for 85%. (2) E-tendering has broad foreground. Government gives vigorously support to the E-tendering 674

4 application. And it promulgates some law and the policy relative to tendering process. The legal environment about E-tendering is unceasingly consummated. (3) The construction industry information development, construction enterprises, tendering agencies and government information development could promote the development of Sichuan Construction Net function and create well industry environment for website development. (4) The longitudinal integrated development, at present Sichuan Construction Net mainly cuts into tender procedure of construction projects namely mainly involves government correlation department, tendering agencies, construction material distributors and construction enterprises. There has great customer excavation potential in the aspects of project overseeing organization and construction material tendering and bidding. 2.5 The threat of Sichuan Construction Net (1) Network foundation establishment construction relative drops behind China is a developing country and industry and enterprise's informationization level is relative lower. Data transmission ability and the data-handling capacity are all extremely limited. The laggard hardware facilities might be a bigger hindrance to the website development. (2) The website faces many kind of technical prestige The service pattern provided by Sichuan Construction Net is based on the network, and the industry characteristic determines that it requests very high quality of service secrecy. Therefore, once the website platform receives the network virus large-scale attacking, or the website comes under the attack, the provided service all will to be effected. Moreover, it need to be thought much of that data transmission secrecy and data real-time renewal and backup. (3) Intensive market competition At present, there are many kinds of websites issuing tendering information in Internet. And competition is very intense. Although these websites have the difference with the Sichuan Construction Net in the management pattern and market subdivides, the threat brought by local, different department or cross region, cross department websites is very obvious. Such websites as Sichuan Bidding Net ( Sichuan Engineering Construction Tendering and Bidding Net ( and so on have more or less the influence to Sichuan Construction Net. 3 The Development Strategies of Sichuan Construction Net 3.1 Construct comprehensive electronic platform and cultivate the Sichuan Construction Net to be the leader of construction industry informationization The recent development goal is to realize five chains, build five platforms and complete an entrepot. Five chains means to realize germination of project setting up item and engineering design, germination of tender announcement and construction enterprises, germination of equipment material demand and commodity supplier, germination of human resources and talented person demand, germination of land supply and real estate empolder. At the same time five platforms which will adapt with five chains would be built and an on-line entrepot namely on-line trade center would be completed in this foundation. The CALS system would be comprehensively advanced and it is the master line. Base on the foundation of constructing the credit records system, the investment project information would be issued prominently and simultaneity the Sichuan province expert warehouse system application and the Sichuan province construction market credit records system application would be strengthened. With speeding up the Sichuan expert warehouse system and Sichuan province construction market credit records system depth exploitation, Sichuan Construction Network diligently explores the management pattern which electronic government and electronic commerce unifies, positively provides the technical support for the provincial industry information construction, makes great effort to be the leader of construction industry informationization. 3.2 Strengthen the influence of brands and to build the trade information resources platform that designed interests of various fields such as government, construction enterprises, bidding agencies, the construction material distributors, and experts to win together 675

5 Generally speaking, an industry profession media has four kinds of resources. They are government resources, profession resources, relating resources, media resources. Therefore we may mainly begin from these four aspects and makes the high quality profession network media brand. [4] Firstly we should make perfectly use of government resources. Must fully incur bids the information using the issue the special permission, promotion network media authority, moreover in the tender process massive information input and outputs record will become an important resources through long-term accumulation. Next is to make a connection of up and down river industry resources through supply chain, the Sichuan Construction Net has the massive constructions enterprise associates, tendering agencies, construction material distributors, and massive experts and so on. It has a bigger feasibility to carry on the investigation to these resources depends on the government background and relative cost is lower. This information have positive impetus role for industry inside multiplex development, especially for project management consultation organizations, consultants, exhibits and promotion. Again next is to enlarge the relative resources. Relative resources mainly is refers to relative profession, fund, customer relationship, information channel, management team, operation experience and so on. We should further strengthen the relationship of the related resources outside industry and get other correlation industry resources through content product, service extending or chains. We would realize the cross industry linkage. Finally we should fully take fully use of network media resources. It mainly refers that network media itself possess visible or invisible market value resources, including brand of Sichuan Construction Net, management system and mechanism and so on. These resources have vital significance to promote profession media competition strength and conformity, operation or control government resources and profession resources connection resources. 4 Conclusions In summary, Sichuan Construction Net has got government correlation department's vigorously support. It has advanced technical equipments and high quality services and diverse products. Simultaneously it also has outstanding management team; technical talented person and advanced management ideas. It has the resources which the enterprise monopolized such as experts database etc. With the users unceasingly expands needs and technological development, the website also must unceasingly develop in the content and function aspect which needs massive funds investment, and the same as in promoted implementation. How to effective financing becomes a crucial question relates survival and development of the website. Although the website management has a bigger risk, it must been seen that electronic tendering has the broad outlook. In intense market competition how to formulate the development strategy of the construction projects tendering websites realizing sustainable development is one of the important problems to the websites operators. Two development strategies are proposed based on the SWOT analysis. One is to construct comprehensive electronic platform and change the Sichuan Construction net to the leader of construction industry informationization. The other is to strengthen the influence of brands and to build the trade information resources platform that designed interests of various fields such as government, construction enterprises, bidding agencies, the construction material distributors, and experts to win together. References [1] Hou Renyong, Gao Yan. Middle region science and technology ability appraisal and SWOT analysis. Science of science and management of Science and Technology, 2004, (9):13~15 (in Chinese) [2] Liu Zhixue, Zhang Baozhou, Zou Anquan, et al. Environmental analysis method for strategic planning of city logistics and its application. System Engineering, 2005, 23(3):47~50 (in Chinese) [3] Song Mingmin.Chinese bank insurance development characteristic and its SWOT analysis. Finance Research. 2005, (4):165~173 (in Chinese) [4] Zhu Xuedong,Gao Jiangchuan, Yu Le. Solution of B to B industry media. Media. 2003, (11):10~20 (in Chinese) 676

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