When developing your specification it is necessary to engage as early as possible in the process. This is important in terms of identifying the desired outcomes, risks and issues, as it permits suppliers to provide feedback on how the outcomes might be achieved, the risks and issues as they see them, along with feedback on timescales, feasibility and affordability. It is also best practice to ensure that suppliers are contractually required to provide line item spend detail as part of the contract support.
There should be clear separation between budgetary and procurement authority. Furthermore, it is recommend that there should be an appropriate separation of duties within the procurement cycle between those who draw up tender specifications, those who invite bids, and those who evaluate bids and awards contracts. This separation of duties should be aimed at safeguarding against impropriety and thereby ensuring achievement of value for money.
The specification must:
- Clearly describe what is required
- Focus on outputs required without being prescriptive as to the method the supplier should use to provide it (output specification)
- Be sufficiently tight so that the product or service fits the user's needs, but not so explicit that it discourages the supplier from proposing innovative solutions that optimise Value For Money (VFM)
- Include performance targets or include criteria for acceptance of the products or services
- Include service levels and a process for measuring ongoing performance
- Avoid over-specification of performance (more than "Fit for Purpose" or than is actually required) to ensure procurement at the optimum cost
- Take account of any e-Commerce requirements
- Take account of sustainability policies where appropriate
- Take into account suitability of design for all users
- Take account of relevant legislation e.g. health and safety and equality
- Take account of relevant policies e.g. is the requirement one that would be suited for the inclusion of a Community Benefits clause?
- Take account of all licensing requirements that a supplier must have in order to operate in a particular industry/sector and which are relevant to the performance of the contract e.g. A supplier of water and waste water services must hold a current retail license for the provision of water and wastewater services in Scotland under the Water Services (Scotland) Act 2005, including signing up to the accompanying market code (including the code subsidiary documents) and operations code
- Not refer to brands or trade names but refer to the characteristics of the product e.g. it is not permissible to specify a particular product brand
- Ensure that any requirements for limits, tolerances, deliverables timescales etc are practical and realistic
- Consider commercial and ongoing performance management aspects of the contract throughout the supply chain e.g. payment terms including those to sub-contractors (SPPN 08/2009)
- Support a structured method of tender evaluation
- Be able to form the major part of the formal contract between the purchaser and the contractor
If the specification is wrong it may result in:
- Failure by the organisation to meet their objectives
- Wasted money
- Unsuitable tenderers
- Unsuitable bids
- Mis-interpretation of requirements
- Major difficulties in evaluating the bids
- Wrong or unsuitable products/services supplied
- Claims of unfair treatment being made by tenderers
The award criteria must be linked to the specification. The award criteria must be relevant to the subject matter of the contract and not discriminatory.
Once a contract is awarded the scope to make changes to the specification (e.g. asking the contractor to deliver more, or less of something that was not was specified at the time of tendering) is limited and any such changes may be challenged in the Courts. If it is not possible for the supplier to deliver the contract as originally intended as a result of omissions or errors in the specification, the contract may have to be terminated and a new procurement undertaken.
If you intend to award a contract on the basis of the most economically advantageous tender you may consider variants on the requirements as long as it has been specified in the contract notice. The minimum requirements to be met by the variant and how the variant will be evaluated must also be stated in the contract documentation.
Who provides the specification?
The User Information Group (UIG) are responsible for developing the specification, but should ensure that other end-users, stakeholders and technical specialists are consulted where appropriate. Part of the role of the UIG is to challenge accepted thinking. At the specification stage the UIG should explore opportunities to incorporate economic development and sustainability considerations.
The foundation of a good specification is laid in the planning and research undertaken before writing begins. Allow sufficient time to create the specification.
There is often merit in discussing the specification with a broad range of potential tenderers. This must be done in a fair and transparent manner to avoid distorting competition and/or giving any potential tenderer an advantage. Care must be exercised to avoid not only genuine unfairness, but also the impression of unfairness to some tenderers. Under no circumstances should any commitments be made during this process.
Following discussions with the marketplace, care must be taken to ensure that innovative ideas and approaches which provide a supplier(s) with a competitive edge are not disclosed in the development of the specification e.g. inclusion of proprietary methods or Intellectual Property Rights (IPR).
Purchasers can also use their commercial influence to help improve the competitiveness of suppliers by encouraging them to produce innovative goods and services which will assist the public body to deliver evolving policies and strategies e.g. with regards to sustainability low carbon products.
Suppliers should not be put to unnecessary cost through casual enquiries for bids. Everyone is responsible for ensuring that best VFM is achieved through the procurement process.
The specification should be written in "performance" terms, which focus on the function of the product or the output of the service required. It builds the specification around a description of what is to be achieved rather than a fixed description of exactly how it should be done and encourages innovation in the market place, thereby allowing and encouraging suppliers to propose modern (including environmentally preferable) solutions.
In very exceptional circumstances, for a very limited number of products or services, a "design" specification may be unavoidable. As the term implies, such a specification starts with exact details of the physical dimensions, the materials used, power input and output, the manufacturing processes required, and so on. The nature of the requirement may make it essential to narrow the options by writing a detailed full design specification. However, these assertions should be tested and guidance sought particularly when EU Procurement Regulations apply, as a "design" specification may restrict competition.
Technical specifications and standards
The EU Procurement Directives set extensive rules on how contracting authorities may define and incorporate technical specifications and standards.
You must avoid reference within a technical specification which has the effect of favouring or eliminating particular suppliers by specifying a particular material or goods of a specific make or source or to a particular process, or trademark, patent, type, origin or means of production e.g. do not specify "Hoover" when we mean a vacuum cleaner or "Intel" when we mean a Central Processing Unit of a PC. In exceptional circumstances such reference may be justified if either the subject of the contract makes the use of such references indispensable or where the subject of the contract cannot otherwise be described in a manner which is sufficiently precise and intelligible to all bidders. In either circumstance, such reference must be accompanied by the words "or equivalent".
Using samples, patterns, etc, in specifications
If it is not possible to produce a detailed description of the requirement, samples or patterns may be issued to the tenderers or requested from them. In this case, a "sealed sample" must be kept for later comparison with the products supplied. Samples, patterns and drawings may also form part of a design specification.
Any samples that are no longer required should be returned to the tenderer.
Care should be taken that Copyright is not breached when using samples, patterns etc. for specification purposes. Consideration again needs to be given to the Intellectual Property Rights of the tenderers.
Simplification and variety reduction
Simplification and variety reduction techniques can help in reducing costs and in obtaining better VFM.
Simplification and variety reduction in a specification requires the elimination of complexities in design by omitting different types, sizes, grades etc. of products. At its simplest this might be seen as the reduction in the number of colours in which an item is purchased, or in the sizes of envelopes which are purchased and kept in stock and can be a valuable tool when seeking to establish a specification for large collaborative procurements.
Contract implementation/contract and supplier management
As you develop your specification, especially an output specification, you will start to consider how the quality and performance aspects of the goods and services of the contract will be measured. These factors should be translated into the Management Information(MI) you will require from the supplier(s) and the Key Performance Indicators (KPIs) both of which will be included in the ITT and Terms and Conditions.
Review and sign-off
The key criteria that the UIG need to ensure in completing the specification are:
- Requirements are complete and accurate
- Stakeholders needs are taken into account
- Future developments have been taken into account
- Consistency with the organisations' requirements and objectives including business case, EU Directives, and other relevant legislation, procurement and contracts strategies, sustainability objectives and evaluation strategy
- Risk assessment is completed to ensure that related risks are closed or managed
Procurement Officers should give consideration to the following aspects when preparing specifications:
|Description ||Y/N |
Are previous (similar or related) specifications available?
Are the requirements stated clearly, concisely, logically, unambiguously and contain the essential features or characteristics of the requirement?
|Do the specifications contain enough information for potential suppliers to design and cost the products or services they will offer? || |
|Are limits, tolerances or performance targets reasonable and reliable? Are they written in such a way that they define the criteria for acceptance of offered products or services as well as permitting them to be evaluated by examination, trial, test or documentation? || |
|Do specifications conform to relevant national, European or international standards and comply with any legal obligations? || |
Do specifications provide equal opportunity for all potential suppliers to offer a product or service which satisfies the needs of the user and which may incorporate alternative technical solutions? Ensure that specifications do not contain features that directly or indirectly unlawfully discriminate in favour of, or against any supplier, product or source.
Is the specification presented in performance terms rather than a detailed design?
Are you sure that it does not over-specify requirements i.e. specify performance that is more than 'Fit for Purpose'?
Have you taken due account of the buying organisation's environmental, other sustainability, social and other relevant policies?
Have you considered the possibility of variety reduction and simplification?
Does the performance of the contract require the contractor to hold licences, and does the specification reflect this?
Are site specific requirements necessary?