The Future of Quantity Surveying: Tender Analysis using AI & ML

The old way of doing Tender Analysis

For any Quantity Surveyor out there, whether you are a Trainee QS or now a Commercial Director, whoever you are in the construction industry, you will know the Tender Analysis process and likely won’t much enjoy the prospect of doing your next one.

The Tender Analysis is something that any self-respecting construction industry professional will know, but most of us do not enjoy it.

Of course, it is a necessary evil, but does it need to be so complicated?

The tender analysis is integral to maintaining the integrity and efficiency of the construction industry’s procurement phase when you receive quotes. If you have received 3 or 4 quotes, it is time to line them up and do your tender analysis. However, that is if you are lucky enough to have received your pricing from subcontractors in an identical format, which often you have not.

The Tender Analysis for me starts when you send subcontractors your tender, you submit a BoQ or Pricing document, and the Subcontractors must reflect their price on your BoQ, which helps you do the Tender Analysis. Remember, this analysis isn’t just about compliance or comparing prices; it’s about enhancing the construction process through meticulous scrutiny and strategic decision-making.

Furthermore, in the current landscape of the construction industry, tender analysis has often been more about manual alignment and less about insightful analysis. At C-Link, we understand that Quantity Surveyors spend an inordinate amount of time on manual aspects of Tender Compliance and Price Analysis. However, we envision that in the future of quantity surveying, QS’s redirect that time towards more impactful aspects of project management. For instance, incorporating AI into the financial aspects of project management, particularly in project financing, can significantly enhance the precision of cost estimates and risk assessments. If you want to learn more about how C-Link is helping Quantity Surveyors leverage the power of AI, you can book a demo here.

The Tender Analysis should allow you, as the QS, to do a few things:

• Tender Compliance Analysis: You want to be able to compare each contractor’s suitability for the scheme and employment by your company. Do they have appropriate financials, insurance and accreditation to be fit for the project and for sign-off by your Commercial Director?

• Tender Price Analysis: Comparing apples with apples. You want to compare like-for-like quotes and line them up against one another to be sure each contractor has priced the same.

• Analyse the two matters above, revert to each tenderer, and confirm where they stand regarding pricing, allowances, exclusions and potential value engineering opportunities.

The sad point is that Quantity Surveyors spend most of their time completing items 1 and 2, doing the manual work. The actual details of the analysis and where the quality of the Quantity Surveying works come in on item 3 often don’t get the time it needs due to how much time is lost on items 1 and 2. In my view, this is ridiculous and explains why lead times slip and poor procurement decisions are often made.

But, with the advent of AI and Machine Learning, the construction industry stands on the brink of a transformative era. AI’s ability to perform natural language processing and extract data from documents is reshaping how Tender Analyses are conducted. This technology not only streamlines the previously arduous manual process but also introduces a level of precision and speed previously unattainable. This shift is fundamental at a time when the construction industry faces a shortage of skilled Quantity Surveyors and increasing complexity in construction projects.

By integrating Artificial intelligence into the Tender Analysis process, we aim to revolutionize the construction industry’s approach to procurement. Our vision is to transition from traditional methods to a digital-first approach, where AI supports Quantity Surveyors by automating data extraction and analysis, thus allowing them to focus on value engineering and relationship building—the core skills that AI cannot replace but can enhance.

How long will the traditional route take?

At C-Link, we commissioned internal research in our community and found that, on average, Quantity Surveyors spend 6 hours per package doing a Tender Analysis. Naturally, this fluctuates depending on the complexity of the package; a Decorating package is likely to be much simpler than a Groundworks package; for example, still, the number of hours we are spending is crazy.

At C-Link, we recently communicated with a Tier 1 Main Contractor who said the following:

• We do 100 projects per year.
• We do 20 packages per project.
• We take approximately 8 hours per Tender Analysis.
• That is a total of 16,000 hours of Quantity Surveying time per year.

According to Totaljobs.com, the average QS salary in the UK is £57,500 salary. A QS’s average hourly cost is calculated at £30.98 per hour, based on 232 working days per year. Therefore, 16,000 hours x £30.98 per hour is a total of £495,680.

Isn’t that ridiculous?

A single company is spending approximately half a million pounds on the Tender Analysis process alone if the average QS is earning £57,500, which is also the equivalent of 8.6 Quantity Surveyors.

The old way of working has worked up to this point. Still, the industry needs a way to simplify and expedite the procurement process, particularly in the context of the Quantity Surveying shortage.

Is there a better way to work?

So, at C-Link, we’re trying to imagine the Future of Quantity Surveying and what that would be like. For us, the critical element of any Tender Analysis process is in the analysis, not the lining up packages next to each other in a manual process.

For the future of quantity surveying, we want to build a world where a Tender Analysis looks like this:

Future of quantity surveying: Tender Compliance Analysis

All PQQ data for a Subcontractor is centralised in one space, and before getting on the procurement schedule, all the standard PQQ data is consolidated in one area. As the Subcontractor submits the tender, they are notified at the point of transaction that they must submit specific missing data. Therefore, when the QS is doing the Tender Analysis, not only is all of this information present but it is also analysed with any anomalies noted.

AI automatically extracts any anomalies in the data, highlights them to the QS, and adds them to a report.

Future of quantity surveying: Tender Price Analysis

Quantity Surveyors can create standardised and Digital Bills of quantities or Pricing Documents in minutes. In creating a Digital BoQ, subcontractors are pushed into a specific submission process, and the system can auto-compile data to develop a tender analysis in seconds.

AI can line up your tenders and extract differences between, say, your four tender return prices while removing any key differences and qualifications that each party makes.

Once you have your data lined up, the typical process for a QS is to highlight to each Subcontractor any apparent anomalies in pricing (where they are too high or too low) on a given item and ask them to confirm or consider a reprice in this area.

Imagine if, once all your prices were uploaded, you, as a Quantity Surveyor, could generate a Tender Analysis report for each Subcontractor explaining this to them. AI could be used to create the differences, and in doing so, you, as a QS, get to work on what you do best – value engineering and building rapport and relationships.

Moreover, imagine if AI could help you leverage market rates and risk insights by assessing allowances, exclusions, lead times, and programmes. This would make the Commercial and Procurement teams much more agile and efficient. We’re all under tremendous stress and pressure to meet project programmes, I believe this could be the way forward.

I genuinely believe this is the future of quantity surveying. AI and Machine Learning will not wipe Quantity Surveyors off the face of the earth. Instead, it will empower us.

The RICS view on AI and Machine Learning

On the Own the Build podcast, Andrew Knight, RICS’ Global Data and Tech lead, shared his belief that given AI’s pervasiveness now, in its infancy across so many sectors, it is only a matter of time before it starts to shape the Construction and Quantity Surveying world.

Andrew recently said, “AI can help because it can do natural language processing; it can extract data from documents.”.

This is precisely where the world is heading regarding the Tender Analysis process. Machines can read and standardise the previously lengthy and manual process that Quantity Surveyors have been doing.

This will not remove the need for Quantity Surveyors but will change how we work, and if you want to learn more about how C-Link is helping Quantity Surveyors leverage the power of AI, you can book a demo here.

About Chris Barber

Chris began his Quantity Surveying career in 2006, working for one of the market leaders in the Design for Manufacture and Assembly (DfMA) sector. After cutting his teeth as a specialist subcontractor for over seven years, Chris transitioned to Main Contracting, working on high-end residential schemes across central London, constructing and fitting out buildings for high-net-worth individuals and estates. Having worked on both sides of the industry, Chris understands the pain points and inefficiencies these two essential stakeholders experience and believes technology will revolutionise how the industry does business and dramatically shift its outdated culture.