The bids assessment mechanism primarily depends on the level of significance given to cost by the State. The bids are assessed by one of the following methods:
a. Pure Technical Assessment Method
The bid assessment depends on the technical competency according to a points/weight system agreed upon in advance and followed by a contract value negotiation. In this case the method is known as "Quality Based Selection". If there is a fixed budget for the consultancy services, the method is called "Fixed Budget Selection". The committee/ concerned Federal Entity shall have the right to decide whether to disclose the financial cap allocated for these services or not.
b. Joint Technical and Financial Assessment Method
In this method, the technical and financial elements shall be taken into consideration based on specific weights. This method has various forms, including what is called "Least Cost Selection with Technical Hurdler", in which the final assessment depends on the classification of the financial bids submitted by the consultants who obtained the minimum technical score, e.g. 70 points out of 100 points.
The other form of the technical and financial assessment is what is called "Quality and Cost Based Selection". In this form, a set of points are calculated as the average of the technical and financial points based on the weights as the average points of each of them: for example, a weight of 80% may be allocated to the technical points against 20% for the financial points, or 90% for technical points against 10% for the financial points depending on the financial element.
Those two forms may be integrated by calculating the total points based on their technical and financial weights for the bids that get the minimum technical score.
c. Pure Financial Assessment Method
In this method, the bidder winning the consultancy contract is the one that proposes the least price. Although the assessment is fast and easy in this method, the bids submitted shall not include the proposed working team or the resources to be provided by the consultant. This method does not encourage the experienced and highly skilled consultants to participate.
The bids assessment method shall be selected based on the types of consultancy services required according to the project nature and any financial limits imposed on the joint project study budget. Thus, it is difficult to recommend a standard assessment method for all projects, but it is preferred to take the technical aspect of the consultancy bids into consideration, including the experiences and skills of the work team. For that reason, the joint technical and financial assessment method is used in awarding contracts through an open international competitive bidding or by Tendering. The technical aspect of the consultancy bids is very significant due to the difficulties that the contracting Federal Entity may face in estimating and imposing penalties on the consultant if it fails to carry out its duties according to the required specifications and conditions. The contract termination and contraction with another consultant shall result in incurring additional administrative costs and delays the joint project awarding process.