Society

Winning lucrative public contracts

Contract-permit
scottbellows

Summary

  • Logically, many businesswomen and businessmen might assume that media coverage that provides a positive public image of their firm might enhance their ongoing success rates for government contracts.
  • In a major study spanning a sixteen-year period, Michael Hadani, Berna Aksu, and Susan Coombes uncovered the effects that media spotlights have on firms’ success in winning tenders and securing government contracts.
  • The trio found that throughout the study timeframe, media coverage reduced an organisation’s ability to win government tenders by statistically significant proportions.

Nyamboke excitedly scrutinized the government tenders advertised in the Friday edition of the Daily Nation. Her business selling cleaning supplies launched back in 2019 and retained five full-time staff and periodically, depending on orders, swelled beyond twenty temporary workers. She noted that on the particular day, three tenders in the newspaper seemed winnable. Nyamboke’s firm held an impressive 50 per cent success track record in winning government tenders when they applied.

Thrilled at the new prospects, her team bundled together the required documents, put together a quote, and ferried the tender application packages to the respective government offices. Unrelatedly on the following day, the firm appeared in a special investigation feature on NTV highlighting cleaning supply firms who either supply substandard products or sell quality goods. Nyamboke’s company thankfully featured as one of the quality suppliers in Nairobi. Elated, she expected that the positive media attention would increase her chances of securing one or all of the three tenders.

Following a long three-week wait, Nyamboke started receiving regrets from each of the three different government ministries that her tender applications were not successful. Baffled, she could not figure out, given the positive media attention, how her firm fell below her average success rate so drastically.

Who seeks to curry government favour and win tenders? While our minds immediately wander to the much aligned but ever-present ubiquitous ‘tenderpreneurs’ who often add very little value addition through their government tenders, many other industries from giant low tech and high tech firms, for-profit development implementers, and NGOs, among other sectors, all survive based on winning government requests for proposals and tenders.

Logically, many businesswomen and businessmen might assume that media coverage that provides a positive public image of their firm might enhance their ongoing success rates for government contracts. In a major study spanning a sixteen-year period, Michael Hadani, Berna Aksu, and Susan Coombes uncovered the effects that media spotlights have on firms’ success in winning tenders and securing government contracts. The trio found that throughout the study timeframe, media coverage reduced an organisation’s ability to win government tenders by statistically significant proportions.

Why? Unsurprisingly, most governments like to do deals behind-the-scenes. Media attention on a company brings a spotlight on firms that makes it unlikely that behind-the-scenes deals take place. Too much attention on a company makes government officials feel that behind-the-scenes deals might be discovered. Such deals are not always nefarious. Many times, government officials want to stick with who they know because they want assurance of project success because of strong track records, mitigate their own fear of failure, minimize anxiety that if something does not go right on the project then their superiors will blame them and it will hurt their career prospects, and so on. But obviously, often the motivator for behind-the-scenes deals sadly involves corruption whether in the form of money, power, or favours.

What type of media attention affects an organisation’s ability to win government contracts: positive, negative, or neutral? Astonishingly, the study found that any media glare whether general attention or even a positive media spotlight. Regardless of the type, the media’s gaze diminishes corporate political activity and advocacy. It mutes the efficacy of corporate political activity as government contacts feel restricted in how they can respond and extend preference.

Inasmuch, organisations should include government tender application project teams comprised not just of their procurement departments and sales teams, but also their public relations departments to mute external announcements and campaigns in times leading up to and surrounding government contract bidding. Such coordination gives an unexpected boost to their prospects for tender award success.

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