the Hidden Realities of Computer Industry in Japan Japanese

8.3 Tender System

Tender is a price determination method, which is ordinary invited when government offices, including public schools, purchase computer systems. We remember this word as "One Yen tendered" case written up in the papers sometimes ago. Here I have some stories about tenders.

Of course, lower price is better for computers and software to work them, as they are purchased with the tax gathered from people or so. (It is said that tender is a good method which guarantees for this.)

Once ago, a certain computer-related department of a certain national university decided to purchase a computer system. At the time, it had been obvious that which manufacturer and which model of the computer met their requirement. The decision selecting the manufacturer so had made upon absolutely technical viewpoints, including maintenance matter.

This probably is sufficient being applied to a laboratory level, but to a department level, it is not so as. A tender have to be invited properly fair, and it has to be clearly shown that no unfairness exists in it. At this point, you, the user in future, have a problem. A rival manufacturer (, which you don't know whether his product is adequate for the purpose,) ought to win when he tenders at lower price, since the price is the only and the last judge in tender. Thus you need to take a counteraction against it, otherwise it might make research or eductation stop.

Before tender, a technical check is performed. It is to judge whether the product has sufficient capability for the purpose. This judgment task is left fully exclusively for the department side. To do so is their proper right, and is obligation, because there is no person other than them who can judge that, and they also are the actual users.

There is an important thing here. He/She who takes the responsibility for the new equipment is often the chief professor of the department, or person of such title like the chairperson of the commision for new equipment. No one can be in that responsible position without such proper title. Although it is, the responsible person must not perform the technical check in his/her name. What to do for him/her is to charge an assistant or around with performing the check and to get a report of its result. It is no probrem that the report would conclude that only one product could satisfy the requirements. It is consequent if others are found unusable. The report should designate not only pass-fail result but more concrete result, because every manufacturer proposes different product insisting its own performance, usability, and likes. For example, it would include such line as "If product A has 10 million Yen value, B is also usable, but has less than 6 million Yen value at the best". Writing so firmly as it is actually so is the conscience of technical specialist.

You may think it causes the tender to wreck, however, it is quite fair because it is based upon sound judgment of proper technical specialist. The department has made a right selection in that right way.

Sometimes extraordinary cheap price are applied to a tender, as when a computer course is opened at a public school. In some case, the proposal reaches 1 Yen, the lowest possible price. It is natural and has no problem as for the enterprise side, since they are expecting for future market as to the students becoming used to their computer products. For the school side, it might also have no problem, since they can obtain better computer system at lower price.

But, it did not actually go so in a municipal junior college, where my former classmate taught. They purchased a computer system not on consideration for its performance, nor for the hereafter. In such municipal junior college in provincial city, the administration budgets for computer systems almost unlimitedly as to their students being educated of computer in some way. It seems as if they thought that merely to buy products could educate students. It is the most favorable case for the manufacturer. Because if once the product has been introduced, the manufacturer will have his hands free on it.

The tender would be accepted if it offers low price for those might be introduced first. Then they begin sale of every sort of accessories and supplies one after another. They gain money so much for long term hereby. It is just what we say penny-wise and pound-foolish.

Well, it is not so worse if it comes to end thereafter. Often we have to pay something almost bulky refuse by just only a reason that it is cheap. My former classmate mentioned above have had to buy another model of computer for herself after she had found the introduced model wholly unusable at last. Though what she wanted to do with it is simple, as those like word processing, small data processing or so, the introduced model has scarcely has any application software even for them.

And then, there is an another episode of another national university. About 10 years ago, a mainframe of certain manufacturer had installed for an exclusive use of a department. As communication lines between the mainframe and each laboratory were necessary, a subcontractor was called. Though the cable installation itself was simple as it could be made by students or postgraduates without any help of such company if proper materials were supplied, the computer manufacturer insisted it was not guaranteed that the computer worked properly unless the lines were laid down formally by the subcontractor (in his fiefdom). After all, no fewer than 6 million Yen were paid for that installation work, whereas its actual cost, I thought, was no more than 1 million Yen at the most. Additionally, he pointed out the guarantee, however, the system would have no problem if only proper cables could be purchased.

Thus it became the waste of 6 million Yen, which occurred on matter of paperwork. Though a 6 million Yen research budget is much sufficient for some laboratories' desire, the administrative has yielded such amount to the threat of the enterprise. I have heard the laboratory assistants who could understand this situation felt much mortified. I think it completely reasonable.

These stories are not applied only for schools nor for government offices. I have often seen such enterprises falling into same pitfall, upon their officialism being spread as they grows. I shall recommend strongly that to be careful to lowered initial cost, since it blinds you to what happend thereafter.

Copyright 1996, 2000, 2004 Hirofumi Fujiwara. Translated by Y.K.
No reproduction or republication without written permission.

the Hidden Realities of Computer Industry in Japan Japanese