As noted in a recent CP24 article, the city of Toronto recently uncovered a long-running bid-rigging scandal. Contractors were regularly colluding in order to split projects. This took place over a five year period and accounted for a combined series of contracts worth over a half billion dollars!
This issue was only discovered when the Toronto Auditor General studied the bids and identified disconcerting patterns such as districts being split evenly between two contractors. These issues may seem specific to large local governments like in Toronto, but in truth they could happen on a micro level in any municipality in Canada with the same contract-management procedures. Every local government awards contracts to businesses for tasks such as plowing roads, constructing buildings and parks, running transportation services, and more.
The challenges with Toronto’s procedures, which are common to many local governments, can surface anywhere an auditor decides to look:
- No database of contracts. In a situation like this, there is no way for the city to easily view data on multiple contracts so that potential patterns or issues can be spotted;
- Lack of proper training. Employees who are not instructed on how to detect problems means there is no oversight to ensure these steps are done correctly;
- Messages not being tracked and logged. Such a circumstance acts as an enabler, presenting contractors with the opportunity to discuss confidential contracts with each other;
- No comprehensive controls solution. Without linkage of all procedures, it becomes impossible to monitor different stages of the approval process.
In the case of Toronto, the Auditor General created a report describing these issues and recommended that the city implement various processes which are staples of effective ECM solutions such as those offered by Ricoh. Such recommendations are increasingly common as government officials realize how these solutions can rectify inefficient or ineffective processes across the board.
An ideal bid contracting system creates a “safe work place” and would include the following:
- Implementation of a comprehensive tracking system. This is a secure system through which contracts can be followed through each step of the process from when they are created to when they are bidon, awarded, and completed. A trained coordinator conducts a weekly review of this system to ensure that due diligence is implemented and projects move forward at an acceptable pace;
- Establishment of an intuitive interface for viewing data. All data would be presented in an accessible and consistent manner so that employees could easily spot obvious patterns such as one half of the city going to one contractor and the other half going to another; Pattern-matching algorithms. The system would include sophisticated algorithms functioning to check the data regularly. This ensures that there ae no obvious discrepancies such as in the Toronto case where a contractor was found to have bid exactly 10% above another contractor’s quoted price on 44 different line items;
- Creation of bid requirements. All bids would require authorization and approval by multiple employees before being accepted. An automated business process would log which employees approved contracts to move on. This would help ensure that there was no illegal internal coordination between employees and contractors.
Ricoh can create this customized comprehensive contracting system for your local government. We are an internationally recognized award-winning company with the experience of working with local governments across the country. In addition to providing the software we also:
- Provide extensive support so that IT departments can spend their time on other vital government processes;
- Implement the best practices for managing an effective transition between the old system and our comprehensive solution. We have overseen hundreds of such transitions and providethe best ways to manage them; Supply solutions which integrate with existing software and hardware. This means no unnecessary hardware purchases are needed; Offer a wealth of knowledge about government regulations relating to compliance and retention requirements. Working with over a hundred local governments across Canada has given us the experience and familiarity with the peculiarities of compliance requirements in different regions. Our systems aid governments in remaining aligned with these regulations, eliminating the need to worry about potential lawsuits;
- Customize solutions to meet the exact needs of the particular city, village, town, or municipality. We know that each local government is unique and faces its own problems and provide solutions that reflect this fact;
- Are environmentally conscious and maintain sustainable and ethical business processes. By working with us, governments not only avoid negative publicity due to scandals but also get a better public image as constituents see that their government cares about environmental issues.
By working with Ricoh to implement streamlined systems, local governments can protect against potential scandal, avoiding the damage to their reputation and monetary costs.
Talk to a Ricoh representative about how you can create a secure contracting system.