PROCUREMENT AUCTION DESIGN: TENDER MANAGEMENT AND BIDDING STRATEGIES

Calendar

2,5 days in face-to-face: 26-28 November 2018

Distance Learning (4 hours): 12-25 November 2018


Value drivers


To get the best deal in Google AdWords and Facebook Ad Auction and attract the customers you want, you have to second guess the strategies by the bidders you are competing against. And to fine tune your platform for sourcing key production inputs, you must anticipate how participation and bids by your suppliers will respond to the tweaks in your auction design.

Once the realm of art collectors and public contractors, bidding in auctions is now becoming common place in business.  Participating in this course you will practice how to think strategically and you will learn how to analyze the impact of different types of auction designs, ranging from pay-per-click auctions for online advertising to calls for tender to build infrastructure and contracts for high-value services.

Through a mix of interactive case studies and role playing in simulation games, the course will bring together professionals who sit on the two sides of procurement markets: purchasing professionals who manage the sourcing process on the demand side and sellers who supply business/government buyers.

You will exchange experience and learn:  
•        As bidder, how should you behave when faced with different auction rules? What should you watch out for in the design to avoid common mistakes when bidding?
•        As tender designer, what key design leverage should you pay attention? How can you optimize your sourcing system to deal with bankruptcy, collusion, timely delivery and quality?


Participants 

The programs is designed for both procurement and sales practitioners:

  •          Chief Procurement Officers, Senior Buyers
  •          Chief Sales Officer and Commercial Representatives

The target audience:

  • Industry: Oil&Gas, Energy, Construction, TLC, Automotive, Pharma and wherever high value auction are used to select the partner and negotiate contract conditions (buy or sell side)
  • Company: Big corporations and wherever spending value or turnover value is managed through auctions (buy or sell side)
  • Consulting companies
  • Public institutions: central or regional governments, health care institutions with their procurement professionals

Content

•    Procurement auctions: definition, characteristics, rules and parameters

•    Game theory approach: strategies, payoffs, information and equilibrium

•    Bidding strategy: rationality and behaviors in presenting the quotation
-    “Optimal” bidding
-    Typical biases and learning patterns
-    The effects of increased participation and competition
-    Cost structures (private vs. common) and their implications for bidding

•    Auction Design: how different auctions rules influence the equilibrium outcomes of the game
-    Sealed bid formats vs. open outcry ascending auctions
-    Revenue equivalence among auction formats: when it works and when it does not
-    Asymmetry: dealing with highly heterogeneous bidders
-    Auction design under multiple risks (timing/quality of delivery, collusion, corruption)

•    The game: mix & match in different contexts and markets
-    Bankruptcy risk in high stake auctions (TLC, infrastructure, etc.)
-    Collusion between suppliers: collusive strategies and countervailing measures
-    Multiple lots and divisible goods: arranging large scale or repetitive procurements
-    Methods to foster quality in procurement: ex ante selection, ex post monitoring, financial guarantees/surety bonding, vendor rating 
-    Renegotiations with current suppliers and attracting new comers

•    Case histories and in class experiments with tendering design and bidding strategyRetail strategy


 Faculty

Marco Ottaviani
Full Professor of Economics, Bocconi University.

Francesco Decarolis
Associate Professor of Economics, Università Bocconi

Nenad Kos
Associate Professor of Economics, Università Bocconi

Giuseppe Stabilini
SDA Professor of Procurement and Supply Management


Enrollment procedure

Please complete the enrollment request form, available on this web page, and mail or fax to:
SDA Bocconi School of Management
fax +39 02 5836.6833
email: cristiana.testa@sdabocconi.it

The final deadline for enrollment is 23 October 2018.

Enrollment requests are reviewed on a rolling basis, those received after the final deadline may not be accepted. Please see details in the enrollment form.


Participation fee 

€ 3.900 + VAT (if required)


Special Payment Terms 

A 10% reduction on the program fee is offered to applications sent in by 13 September, 2018.