Applications of knowledge based expert systems in recurrent competitive bidding

Previous bidding studies have focussed on optimum bid pricing and several approaches have been proposed for this problem. Unfortunately, there are problems with each of these approaches and so to date there is no generally accepted approach to bid pricing. Furthermore. bid pricing is only one of a series of interrelated decisions that need to be addressed when formulating an overall bidding strategy. For many organisations decisions concerning whether or not to bid and the level of resources to allocate to bid preparation are equally important. Both of these areas, however, have received scant attention from the academic community, Together these observations suggest that radically different approaches for improving bidding performance should be investigated. Expert systems display several characteristics which suggest that they offer a possible route to further progress in work on bidding and this thesis explores the possible roles and benefits that expert systems can provide in this area. In particular this thesis describes a case study concerning the development of an expert support system for tender enquiry evaluation. The system was developed for use by the senior management of a large electro-mechanical engineering company to assist with their decisions concerning whether or not to bid and the level of resources to allocate to bid preparation. In the case considered the expertise of two senior managers involved in a~sessing enquiries was developed into an expert supportsystem. Knowledge was elicited from these managers by asking them to consider previous tenders and specify the factors used in discriminating between them. Their responses were represented in repertory grids, A subsequent validation study suggested that the system developed provides an appropriate model of the organisation's consensual business perspective regarding its bid versus no bid and bid resourcing decisions. Furthermore, collaboration helped the organisation to clarify its bidding expertise in a changing business envirorunent. In particular, it highlighted the organisation's current bidding policy and forced the organisation to reconsider what its ideal policy should be. It also drew attention to some dissenting views amongst the organisation's senior management and highlighted possible weaknesses within their own expertise.frIn summary, the resulting expert support system was perceived to improve both the objectivity and consistency of the organisation's enquiry review group and was generally welcomed by the organisation." It is concluded that expert systems are appropriate tools for modelling competitive bidding situations. However, owing to the nature of bidding domains and non-formal managerial domains in general. the case study suggests that several problems need to be addressed if commercially viable systems are to be developed. Most importantly of which are the identification of appropriate development and validation methodologies in domains characterised by multiple unarticulated experiential based models.