The presentation has attempted to explain the preparation of technical specifications and estimate for the procurement process.

1. 1
SPECIFICATION
&
ESTIMATE PREPARATION
1
Er. Satya Narayan Shah
B.Sc. In Mechanical Engineering (India)
MS in Manufacturing Engineering & Management (UK)
Email: er.snshah@gmail.com
Cell: 9851004366
February, 2016
A proverb…
“If you always do what you’ve
always done, you’ll always get
what you always got”
Challenge and question repeat
in purchases
Each procurement is unique
INTRODUCTION
The goal of Purchasing is to provide
the end user with the professional
service necessary to meet the end
user’s requirements, based on the
historical, budgetary, and legal
requirements of the organization.
The most important tool to achieve
this is the SPECIFICATIONS.
Preparation of Specification
The act of specifying, a detailed,
exact statement of particularsexact statement of particulars,
especially a statement prescribing
materials, dimensions, and quality
of work for something to be built,
installed, or manufactured.
Scope vs. Specifications
Scope of Services:
Means the parameters of services needed by the Department
or the expertise of the respondent needed to perform
services required by the Department.
Specifications:
The act of specifying, a detailed, exact statement of
particulars, especially a statement prescribing materials,
dimensions, and quality of work for something to be built,
installed, or manufactured.
Scope/Specification
IT’S NOT ABOUT
WHAT
YOU WANT BUT…
WHAT YOU NEED

2. 2
 End users /
requisitioners
 HR managers
 knowledge of the market
 knowledge of potential
environmental/social impacts
and relevant regulations and
legislation
 knowledge of
d t / i i fl
Those who might be
involved in identifying
needs include
products/services; influence
on the development of new
products/markets
 information on alternative
products/services,
alternative means of
delivering functionality
 Procurement managers
 Procurement officers
 Suppliers
Specification
Purposes
 Specifications help to avoid lengthy description in the Bill of
Quantities.
 They guide Bidders about the clients intended quality
requirements.
 Formation of contractual obligations as to what exactly the
li t tclients want.
 Help the supervisors and commissioning and testing team.
 It guides to achieve the required total quality and
performance of the end product.
 It helps the Contractor/ Supplier to workout the rates and
prices for bidding the contract.
 It helps the Engineer/ Employer to monitor and control the
quality of end product. 8
Specification
Purposes
 It provides as basis for the quality assurance and
quality management.
 It provides as basis for establishment of necessary
laboratory for quality check.
 It provides basis for dialogue between the
Contractor and the Engineer to agree or disagree forContractor and the Engineer to agree or disagree for
quality of materials and works.
 It may also become a basis for disputes between the
Contractor and the Engineer.
 It is basis for the Engineer to approve or reject
materials or works
 Clear specifications will result in less Claims,
Disputes and Litigation problems 9
TYPES OF SPECIFICATIONS
Design: The intension here for the word “design” means that
the specification is so detailed that it describes how the
product is to be manufactured.(buildings, highways etc.)
Performance: As the name indicates, these specifications
set out the performance requirements that a product is to
meet. Using this concept, the end result is the priority
consideration and, in contrast to the design approach, theconsideration and, in contrast to the design approach, the
manufacturer is given great latitude in how can accomplish
it. This encourages ingenuity, innovation, and cost
reduction.
Combination: Specifications can, and often do, include
both design and performance features. Characteristics of
both are used as prerequisites and as limiting factors in
developing the specifications
OTHER SPECIFICATIONS
Brand Name: Cite a brand name, a model number, or some
other designation that identifies a specific product of a
manufacturer as an example of the quality level desired. Items
equaling or surpassing this quality level are understood to be
acceptable. Although brand name specifications are not
considered good specifications, they have a legitimate though
limited place in public purchasing.
Qualified Products List: This is to determine, in advance,Qualified Products List: This is to determine, in advance,
those products which are acceptable. The evaluation of these
bids is greatly simplified, and the price and the performance
capability of the bidder become the determinants.
Samples: Samples can also be of great value in assuring
compliance and satisfaction after award, but before
production. In this way, many problems can be solved before
the units are manufactured and delivered.
BASIC CONTENT OF A GOOD SPECIFICATION
A specification should:
1. Allow for competition at the manufacturing level
2. Provide information on those measurable physical, functional
and quality characteristics common to manufacturers.
3. Complete in the stipulation of all requirements, either directly,
or reference to other specifications publications or drawingsor reference to other specifications, publications, or drawings.
These requirements should include:
1.Basic design.
2. Physical dimensions.
3. Weights
4. Percent and type of ingredients.
5. Types/grades of materials, if applicable

3. 3
Specifications should not be too restrictive:
1. A restrictive specification usually limits competition and eliminates
items that can satisfactorily meet actual needs.
2. Specification writers should be careful not to use “in house” jargon
and acronyms that may be misunderstood by the bidder.
3. Specs must be well written and communicative.
4. A well-written specification is precise in its descriptions and
directions. It should be clear, simple language, free of vague terms of
those subject to variation in interpretation.j p
5. Abbreviations should be restricted to those in common usage and not
subject to possible misunderstanding.
A good specification writer seeks the advice, assistance and
cooperation of all intended users concerning their precise
requirements regarding the standards of quality, type, size,
etc. for any item(s). Always seek the assistance of
individuals, who have specialized technical competence in
the field for which you are developing the specifications.
Specification
That’s why, the
specifications are to be
written by anwritten by an
experienced
professional.
14
A GOOD SPECIFICATION SHOULD BE
1. Simple, consistent and exact, but not so specific that a
loophole will allow a bidder to evade any of the provisions and
thereby take advantage of his competitors or the buyer.
2. Identified, when possible, with some brand specification
already on the market. (Custom goods are expensive).
3. Capable of being checked. It should describe the method of
checking which will govern acceptance or rejection. A
ifi ti hi h t b h k d i f littl l dspecification which cannot be checked is of little value and
only confusion will result.
4. Reasonable in its tolerance. Unnecessary precision is
expensive.
5. As fair to the seller as possible.
6. Capable of being met by several bidders for the sake of
competition.
7. Clear and Up-to-Date. Misunderstanding can be expensive.
8. Flexible, inflexible specifications defeat progress. Invite
vendors to suggest cost saving alternatives or substitutes.
KEY WORDS
The inappropriate use of key words in your
specification could have disastrous results if the
supplier is not sure what you are requiring and
what you would like to have. Remember,
suppliers, in order to be competitive, will almost
always provide the least expensive product to youalways provide the least expensive product to you.
If you say “may” rather than “will” in the text of
your specification, it could mean one thing to one
supplier and another to the end user.
Use “shall” or “will” where ever a
specification expresses a requirement.
Use “should” or “may” to express non-
mandatory provisions.
MEASUREMENTS
Dimensions, gauges, capacities, size designations,
volume or temperatures should be specified in
accordance with established precedent and trade
practice for the particular commodity or service you
are attempting to purchase. Review the document
after completed and:after completed and:
1. Make every effort to replace words with numbers.
Whenever you go from words to numbers,
communication relating to quantity or quality is
enhanced.
2. Tolerances should be specified where applicable.
3. The use of “minimum” and “maximum” should be
used wherever practical.
FIGURES AND TABLES, GRADES, CLASSES,
TYPES, COMPOSITIONS, ETC.
The use of figures, illustrations, tables and graphs, etc. should be maximized. It
describes the item(s) more clearly and accurately than you can in text. Tables show
relationships more clearly than text. Figures and tables should have titles and parts
clearly identified and should be numbered consecutively throughout the
specifications.
The use of grades, classes and types should be in accordance with established
precedence and trade practices for the type of equipment, materials or supplies you
are bidding. For the purpose of preparing specifications, type grade, class and
iti d fi d f llcompositions are defined as follows:
Type: This term applies differences in design, model, shape, etc. of the items.
Class: This term implies differences in mechanical or other characteristics of items
which do not constitute a difference in quality or grade.
Grade: This term implies differences in quality of a commodity. When practicable, the
first grade of a commodity should be the highest or best grade.
Composition: This term is used to classify commodities which are differentiated
strictly by their respective chemical compositions.
Other Classifications: Other classifications, such as form, weight, size, power
supply, temperature rating, condition, insulation, etc. suitable for reference for the
applicable equipment or commodity item may be used.

4. 4
WRITING HINTS
Writing Style: Exposition is concerned primarily with the communication
of ideas in a form that the reader can understand. It aims to: Save the
readers time, eliminate confusion, and help the reader gain ideas quickly
and easily.
Active Voice is Preferred: Active voice is the most simple and direct way
to make statements. Action is expressed directly, more vigorously, and
makes the sentence more concise. Readers prefer the active voice becausep
it is more: Direct, interesting and descriptive.
Choosing the Right Word: You can make your meaning more clear by
using shorter words. Shorter, more direct words get to the point, are
clear-cut, and distinctive. For example: activate, expedite, initiate,
nevertheless, prioritize and erroneous.
Write Clear Using Shorter Phrases: Do not use long phrases when it is
not necessary. For example: a great number of times (many), at regular
intervals(every), make contact with(call).
Preparation of Specification
Before writing the specification the requirements
should be clearly worked out.
Requirements are often classified as;
• 'Mandatory' - essential requirements that suppliersy q pp
must meet
• 'Desirable' - requirements that whilst bringing
benefits are not essential
• 'Information' - requirements that request
information from the supplier typically for evaluation
purposes
Er. Satya Narayan Shah 20
Specifications
Use of standard specifications reduces the
chances of ambiguity and also makes easier for
preparation of contract documents.
Reference to standards and codes e.g. IS, BS,
21
NS etc. reduce extra efforts in detailing the
specification etc.
Standard Specification- Prepared and
published by the organization.
Standard Specification needs to be approved by the
Cabinet level. Er. Satya Narayan Shah
Preparation of Specification
• Language: Simple and clear, same tense
• Brief: as brief as possible. Standard articles code
books specified by references, no need of
explanation.
• Fairness: fair to all parties.
• Clear Requirement: Express requirement clearly
• No repetition: Repetition of information should be
avoided.
• Unnecessary text: Inapplicable text should not be
included.
22
Preparation of Specification (contd…)
• Inclusions: Inclusion of proper paragraphs for specification
of materials, Major Components, Installations, Tests and
Commissioning, After sales service, Guarantee/Warranty.
• Standard Size: Commercial sizes should be specified as far
as possible.
• Brand/Model: Any particular brand or model should not be
ifi d f ibl If it i t d ti dspecified as far as possible. If it is quoted, options and
choice should be given.
• Use of standard specifications reduces the chances of
ambiguity and also makes easier for preparation of
specification.
• If the standard specification does not cover the requirement,
in such cases specific specifications has to be prepared.
23
Specifications and Drawings
• Specifications and Drawings are the 2 integral
parts of contract, which shows the requirements
(needs and expectations) of the Employer.
• Specifications are referred more in cases of
conflict and disputes whereas the drawings areconflict and disputes whereas the drawings are
dealt in day-to-day work execution.
• Notes mentioned in the drawings are also treated
as specifications and are effective.
24Er. Satya Narayan Shah

5. 5
Specifications and Drawings
• That’s why the Notes written in the drawings are
also to be clear, specific, complete, and carefully
worded as in the Specification.
• To minimize the discrepancy, it is important to take
care in finalizing the drawings and specificationscare in finalizing the drawings and specifications.
• It is advised to include clauses stating “in case of
discrepancy in Drawings and Specifications, the
Engineer will decide ”.
• Such authority to the Engineer may avoid disputes
and litigations arising from some small mistakes.
25Er. Satya Narayan Shah
EVERY SPECIFICATION WRITER SHOULD ASK
QUESTIONS OF ONESELF SUCH AS:
Who will receive the document?
What do I want people to know or do?
What should be my approach?
How detailed and exact should myHow detailed and exact should my
information be?
What can I assume about my audience’s
knowledge of the subject?
What might their questions be?
Specification to be
required to describe the
desired performance,
d t t dand not to reduce
competition.
27
A PRE-WRITING CHECKLIST IS ESSENTIAL
1. Revision or new spec necessary.
2. Determine what information is needed.
3. Determine information sources.
4. Review existing related specs and standards(internal and other
sources).
5. Brainstorm the proposed content with your peers.
6. Develop a conceptual specification in your mind.6. Develop a conceptual specification in your mind.
7. Interview personnel in other affected departments.
8. Other revisions necessary.
9. Within statutory and policy limits.
10. Conflict information.
11. Detailed flow chart necessary.
12. Who is your audience?.
13. Do you have the data to inform them?.
Participants of Specification Process
•User Department
•Contract Administrator
•Contract Compliance and VendorContract Compliance and Vendor
Services
•Consultants
•Legal Department
•Risk and Benefits Management
HOW SPECIFICATIONS AFFECT PROCUREMENT PROCESS
EFFECT ON: POORLY WRITTEN: WELL WRITTEN:
NUMBER OF BIDDERS Overly broad or restrictive Complete, clear concise
specifications. specifications.
Deter potential bidders. Attract MANY AND
Increase costs. QUALIFIED bidders.
Decrease chance of
desired results.
EVALUATION Easily misinterpreted. SHARP SPECIFIC
PROCESS/PROTESTS Open to challenge and CRITERIA
protest by unsuccessful Easier to evaluate.
bidders. Minimizes possibility ofp y
protests.
BIDDER RISK Unreasonable requirements Reasonable requirements
higher risk and higher costs. lower assumption of risk
by bidders.
TYPE OF CONTRACT Uncertain amount of effort Well defined effort leads
leads to cost reimbursement to a firm fixed price
contract. contract.
ADMINISTRATION OF Unclear inaccurate specifications Well defined specifications
CONTRACT lead to management problems. lead to more control and
easier administration. 30

6. 6
Examples of Specification
• Example – Vehicle
•Type – Sedan, Hatchback,
•General - Seating capacity, Engine Power,
C.C etc.
T i i 4 d d•Transmission – 4 speed, 5 speed
•Steering – Manual, power
•Options – AC, Non AC,
•Warranty - Period to be covered
Spec
Car
31
Spec
BIVMicrosoft Office
d 97 - 2003 Docum
Conclusion
▫ Everyone participating is important and
has a role in the specification process.
▫ Plan ahead, good players are ready to help.
▫ Teamwork and team responsiveness is the
KEY to the successKEY to the success.
▫ What your mind can think, your hands can
write.
▫ Well written specifications, is a smooth
sailing to the Procurement Process.
Questions are
welcome
PRACTICUMS
• Prepare Specifications for simple items and
discuss.
▫ Pen
34
▫ Pen
▫ Pencil
▫ Water Bottle
▫ Table
▫ Office Bag
▫ Spectacles
▫ Handkerchief, etc
Cost Estimating
Cost Estimate to be Prepared -
(PPA-5)
 (1) A Public Entity shall have to prepare a
cost estimate as prescribed for any
procurement whatsoever.
 Provided that a cost estimate shall notProvided that a cost estimate shall not
be required for any procurement valuing up
to twenty five thousand rupees (Rs. 25000).
 (2) A Public Entity shall update as
prescribed the cost estimate prepared
pursuant to Sub-section (1).
36

7. 7
ESTIMATION
Estimation is the technical way of working out the
approximate cost of goods before execution of the
procurement process.
 An estimate is the probable cost of the job as
computed based on plans and specifications.
 Estimation requires Knowledge of the
construction/manufacturing procedures and cost ofconstruction/manufacturing procedures and cost of
materials & labour in addition to the skill , experience,
foresight and good judgment.
 For a good estimate, the actual cost of the proposed
work after completion should not differ by more than
5 to 10 % from its cost estimate, provided there are no
unusual, unforeseen circumstances.
NEED
1. It helps to work out the approximate cost of the
project in order to decide its feasibility with respect
to the cost and to ensure the financial resources, if
the proposal is approved.
2 It is used for framing the tenders and helps in the
tender evaluation process.
3. From quantities of different items calculated in
detailed estimation, resources are allocated to
different activities of the project and ultimately
their durations and whole planning and scheduling
of the project is carried out.
4. It is mandatory by the regulation. (PPA‐5)
Estimating Method
 Actual Cost Approach
 This approach requires the estimator to have a
good working knowledge of manufacturing/
construction methods. (based on Standard Norms)
 Historic Data Approach
 The use of historic data from recently awardedy
contracts is a cost-effective method to develop
the estimate, however, solely relying on historic
data may not be appropriate when the data is
based on a noncompetitive bidding environment.
 Combination Approach
 This approach combines the use historic bid data
with actual cost data and other source(Market
Survey). 39
ESSENTIAL QUALITIES OF A GOOD ESTIMATOR
• In preparing an estimate, the Estimator must
have good knowledge of the surveying.
• He must thoroughly understand the drawings of
the item, for which he is going to prepare an
estimate.
He must also be clearly informed about the• He must also be clearly informed about the
specifications.
• Ability to collect, classify and evaluate data
relating to estimation.
• Ability to be careful, thorough, hard working
and accurate.
Matters to be Taken into Account in Preparing Cost Estimate:
PPR-9
1. A Public Entity shall have to take the following matters
into account in preparing cost estimate of any
procurement:-
Procurement for Single Package or Multiple Package
contract.
Whether the procurement contract requires to be renewed or
not,
41
not,
Other options to procurement, if any,
Maximum time and cost that may require to complete the
work under the procurement contract, and
Any directive issued by PPMO
2. Cost estimate for mobilization and demobilization cost,
insurance, facilities to be provided to the consultant,
quality testing, profession related health and safety as
built drawing, commission cost for performance security
etc including the bid or performance security.
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-#_ ef8fsf] nfut cg'dfg tof/ ubf{ b]xfosf s'/fnfO{ ljrf/ ug'{ kg]{M–
ef8fdf lng kg]{ ;jf/L ;fwg, d]lzg/L cf}hf/, pks/0f jf dfn;fdfgsf] ljj/0f,
:k]l;lkms]zg, cj:yf / cfo'
k|rlnt ahf/ b/,
ef8fdf lng] cjlw,
O{Gwgsf] d"No / vkt, /
;ldltn] pko'Qm 7x¥ofPsf] cGo s'/f .
cGo ;]jfsf] nfut cg'dfg -lgodM!#_
-$_ lhNnf:t/sf] lgsfosf] xsdf b//]6 lgwf{/0f ;ldltn]
lgwf{/0f u/]sf] b//]6sf] cfwf/df, s]Gb|Lo:t/sf] ;fj{hlgs
lgsfosf] xsdf ljefuLo b//]6sf] cfwf/df / ljefuLo b//]6
;d]t gePsf] cj:yfdf k|rlnt ahf/ b//]6sf] cfwf/df
df]6fdf]6L nfut cg'dfg tof/ ug'{ kg{]
-%_ dfn;fdfg dd{t ;Def/sf] nfut cg'dfg tof/ ubf{ To:tf]
lgsfodf To; ;DaGwL ljz]if1 jf bIf sd{rf/L eP To:tf]
474747
lgsfodf To; ;DaGwL ljzif1 jf bIf sdrf/L eP To:tf
sd{rf/Laf6 / To:tf] sd{rf/L geP To:tf] sfd ug]{ JolQm,
kmd{, sDkgL jf ;+:yfaf6 nfut cg'dfg tof/ u/fpg' kg]{
-^_ 3/ ef8f / ;]jf s/f/ ;DaGwL nfut cg'dfg tof/ ubf{
k|rlnt ahf/ b/ / ;fj{hlgs vl/b cg'udg sfof{non] ;f]
;DaGwL gD;{ hf/L u/]sf] eP ;f] gD;{ cg';f/ df]6fdf]6L
nfut cg'dfg tof/ ug'{ kg]{
nfut cg'dfgsf] :jLs[lt -lgodM!$_
 lgdf{0f sfo{, dfn;fdfg / cGo ;]jfsf] nfut cg'dfg b]xfosf] clwsf/L
-sfof{no k|d'v_ af6 :jLs[t x'g' kg]{M–
kRrL; xhf/ ?k}ofFb]lv krf; nfv ?k}ofFF;Dd M /fhkqf+lst t[tLo >]0fL
Ps s/f]8 ?k}ofFF;Dd M /fhkqf+lst låtLo >]0fL
tLg s/f]8 ?k}ofFF;Dd M /fhkqf+lst k|yd >]0fL
tLg s/f]8 ?k}ofFF eGbf hlt;'s} a9L /sd M ljefuLo k|d'v
484848
k/fdz{ ;]jfsf]] nfut cg'dfg b]xfosf] clwsf/L -sfof{no k|d'v_ af6
:jLs[t x'g' kg]{5 M–
Ps nfv ?k}ofFF;Dd M /fhkqf+lst t[tLo >]0fL
kfFr nfv ?k}ofFF;Dd M /fhkqf+lst låtLo >]0fL
bz nfv ?k}ofFF;Dd M /fhkqf+lst k|yd >]0fL

9. 9
nfut cg'dfgsf] :jLs[lt -lgodM!$_
;fj{hlgs lgsfosf] k|d'v cfk"mn] nfut cg'dfg :jLs[t ug{ gldNg]
ePdf Ps tx dflysf] clwsf/Laf6 :jLs[t u/fpg' kg]{
;+j}wflgs c+u jf lgsfo, dGqfno, ;lrjfno / o:t} k|s[ltsf cGo
sfof{nosf ;lrj jf k|zf;sLo k|d'vn] cfˆgf] sfof{nosf] nflu ul/g]
vl/bsf] hlt;s} /sdsf]]]] nfut cgdfg :jLst ug{ ;Sg]5 .
494949
vl/bsf hlt;'s /sdsf nfut cg'dfg :jLs[t ug ;Sg5 .
nfut cg'dfg cWofjlws ug'{ kg]{ -lgodM!%_ M :jLs[t ePsf] nfut
cg'dfg cg';f/ vl/b gePdf ;fj{hlgs lgsfon] k|To]s cfly{s jif{
o:tf] nfut cg'dfg cWofjlws ug'{ kg]{5 .
nfut cg'dfg cBfjlBs gu/L l;naGbL b/efpkq / af]nkq cfXjfg ug{
jf k/fdz{ ;]jfsf] k|:tfj dfu ug{ kfpg] 5}g .
Questions are
welcome Againg