development consultants and consulting services 2018

Development Finance, MPP, VJU

Prof. Koji Fujimoto

Class 8 Development Consultants and Consulting Services
1. International Development Cooperation and Development Consultants
(1) What is International Development Cooperation?

5W 1H

“ International Development Cooperation” can be understood by answering the
question of “When and Where, Who does What to Whom, and Why and How?”
(i)
When? : After WW II, two international problems were recognized, namely

when write report the East-West problem and the North-South problem. The developed world
(ii)
(iii)

started to help develop the third world seriously in and around 1960.
Where? : Where are regions and countries? Developing regions and countries.
Who? : The stakeholders of International Development Cooperation are
governments of developing countries and developed countries, international
organizations (MDBs and UN specialized agencies), private sector contractors contruction
and consultants, NGOs/CSOs and so forth. “Who” means here donors.
companies
What? : What do donors (developed countries and international organizations)
do for recipients (developing countries)? The donors extend program

small scale
(iv)

industries
*structural adjustment*assistance and project assistance.
(v)

(vi)

(vii)

A program = many small projects

To whom? : The donors extend development assistance at various levels such
as international, developed country, private company and individual, to the
recipients for their economic and social development.
chủ nghĩa nhân đạo
Why? : There are a variety of philosophies such as humanitarian,
interdependence/co-existence, international peace and stability, international
public goods and so forth.
How? : International development cooperation has to be exercised in fair and
impartial fashion and extended for well-being of targeted population of the

recipient.
(2) Consulting or Engineering Consulting in International Development
(i)
Consulting services and project cycle
In accordance with the project cycle (identification, preparation, appraisal,
implementation and post-evaluation), there are variety of services
development consultants provide. Consulting services of the identification
phase cover development planning and pre-feasibility study, those of the
preparation phase cover the feasibility study, those of the appraisal phase
cover supporting services of the appraisal by staff of lending institution, those

of the project implementation phase cover design and bidding document
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Development Finance, MPP, VJU

Prof. Koji Fujimoto

(ii)

preparation, bid evaluation, monitoring, training for operation, those of the
post-evaluation phase cover project performance evaluation and O&M
services. (See Figure 1 of Class 2 Lecture Text, which is attached at the end of
this text.)
Types of consulting services
Consultants are regarded as one of the stakeholders of development
cooperation other than governments of developing countries, multilateral and
bilateral aid organizations (both financial and technical cooperation),
NGOs/CSOs and private contractors/suppliers. Consulting services are
broadly divided into two kinds of services: Project Services and Advisory
Services. The former is again divided into two kinds of services, namely
Preparation Services such as sector studies, master plans, feasibility studies,
design studies, specialist studies and so forth, and Implementation Services
such as tender documents, procurement assistance, construction supervision,
project management, integrated solutions, training and so forth. The latter
services consist of strategy and policy, regulation, institutional reform,
capacity building, management and leadership, information technology and so
forth. (See Reference 1 Consulting Services Manual of World Bank 2006)

2. Development Consultants

(1) Definition of Consultants
American Consulting Engineers Council defines consultants as follows.
“A Consulting Engineer………………………………
An experienced engineer applying technical competence and judgement to his clients’ best interest by
unbiased independent practice,
A business man, both in his own right and as applied to his clients’ economic and contractual affairs,
A professional man embracing the highest standards of ethical and professional performance.”

Association of Consulting Engineering Companies of Canada defines as follows.
“Consulting engineers offer professional engineering services and expertise to both public and private sector
organizations. Consulting engineers also act as independent agents and advocates for their clients, and are
responsible for finding innovative solutions to technical problems and provide strategic advice to business
and management. In Canada, these licensed professionals offer a wide array of services and expertise in
areas not only related to engineering and science, but also in economic sectors such as energy, resource
development, environmental protection, and manufacturing. Firms that specialize in consulting engineering
are responsible for designing and building much of our public infrastructure.”

An English dictionary’s definition is as follows.
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Prof. Koji Fujimoto
“A consulting engineer refers to a professionally qualified engineer or even an engineering firm which
renders advice, consultancy services or technical assistance to a client in any disciplines of engineering for
a fee. The consulting engineer can also carry out feasibility studies or prepare proposals.”

(2) Types of Consultants
The term “consultant” or “consultants” refers to any organization or person that

provides consulting services to a Borrower, or client. There are various types of
consultants who engage in development projects in developing countries.
(i)
Common types of consultants

(ii)

➢ Individuals
➢ Private partnerships
➢ Limited liability companies
➢ For-profit corporations
➢ State-owned enterprises
➢ Foundations and non-profit organization
Particular types of consultants
➢ UN agencies
➢ Consulting marketing groups

➢ Universities and research institutes
➢ Non-governmental organization: NGO
➢ Financial institutions such as banks, financial firms and fund managers
➢ Procurement agents and inspection agents
(See Reference 1 Consulting Services Manual of World Bank 2006)
(3) Code of Ethics of Consultants
Consultants are often referred to as lawyers and doctors and regarded as an integral
part of clients. Therefore, they are obliged to obey the code of ethics. The
representative code of ethics is set forth by FIDI (International Federation of
Consulting Engineers), which is shown hereunder. FIDIC

dưới đây

FIDIC Code of Ethics

The International Federation of Consulting Engineers recognises that the work of the consulting engineering
industry is critical to the achievement of sustainable development of society and the environment.

To be fully effective not only must engineers constantly improve their knowledge and skills, but also society
must respect the integrity and trust the judgement of members of the profession and remunerate them fairly.

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Development Finance, MPP, VJU

Prof. Koji Fujimoto

All member associations of FIDIC subscribe to and believe that the following principles are fundamental to
the behaviour of their members if society is to have that necessary confidence in its advisors

RESPONSIBILITY TO SOCIETY AND THE CONSULTING INDUSTRY

The consulting engineer shall:

- Accept the responsibility of the consulting industry to society.
- Seek solutions that are compatible with the principles of sustainable development.
- At all times uphold the dignity, standing and reputation of the consulting industry.
COMPETENCE

năng lực

The consulting engineer shall:

- Maintain knowledge and skills at levels consistent with development in technology, legislation and
management, and apply due skill, care and diligence in the services rendered to the client.
- Perform services only when competent to perform them.

INTEGRITY

tính chính trực, liêm chính

The consulting engineer shall:

- Act at all times in the legitimate interest of the client and provide all services with integrity and
faithfulness.

IMPARTIALITY

k thiên vị

The consulting engineer shall:

k thiên vị
- Be impartial in the provision of professional advice, judgement or decision.
- Inform the client of any potential conflict of interest that might arise in the performance of services to the
client.
- Not accept remuneration which prejudices independent judgement.

FAIRNESS TO OTHERS

The consulting engineer shall:

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- Promote the concept of “Quality-Based Selection” (QBS).
- Neither carelessly nor intentionally do anything to injure the reputation or business of others.
- Neither directly nor indirectly attempt to take the place of another consulting engineer, already appointed
for a specific work.
- Not take over the work of another consulting engineer before notifying the consulting engineer in question,
and without being advised in writing by the client of the termination of the prior appointment for that work.
- In the event of being asked to review the work of another, behave in accordance with appropriate conduct
and courtesy.

CORRUPTION

tham nhũng, hối lộ

The consulting engineer shall:

tiền thù lao

- Neither offer nor accept remuneration of any kind which in perception or in effect either a) seeks to
influence the process of selection or compensation of consulting engineers and/or their clients or b) seeks to
affect the consulting engineer’s impartial judgement.

money!!!

- Co-operate fully with any legitimately constituted investigative body which makes inquiry into the
administration of any contract for services or construction.

A number of consulting associations have published their codes of ethics whose
basic principles are the same. For instance, the following Code of Ethics of AMCF
(Association of Management Consulting Firms) includes those basic principles.
Clients
1. We will serve our clients with integrity, competence and objectivity.
2. We will keep client information and records of client engagements confidential and will use
proprietary client information only with the client’s permission.
3. We will not take advantage of confidential client information for ourselves or our firms.
4. We will not allow conflicts of interest which provide a competitive advantage to one client through
our use of confidential information from another client who is a direct competitor without that
competitor’s permission.
Engagements
5. We will accept only engagements for which we are qualified by our experience and competence.
6. We will assign staff to client engagements I accord with their experience, knowledge, and expertise.
7. We will immediately acknowledge any influences on our objectivity to our clients and will offer to
withdraw from a consulting engagement when our objectivity or integrity may be impaired.

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Prof. Koji Fujimoto

Fees
8. We will agree independently and in advance on the basis for our fees and expenses and will charge
fees and expenses that are reasonable, legitimate, and commensurate with the services we deliver

and the responsibility we accept.
9. We will disclose to our clients in advance any fees or commissions that we will receive for
equipment, supplies or services we recommend to our clients.

Profession
10. We will respect the intellectual property rights of our clients, other consulting firms, and sole
practitioners and will not use proprietary information or methodologies without permission.
11. We will not advertise our services in a deceptive manner and will not misrepresent the consulting
profession, consulting firms, or sole practitioners.

(4) TOR (Terms of Reference) of Consulting Services

really have to do

TOR explains the objectives of the assignment, scope of work, activities, tasks to be
performed, respective responsibilities of the Borrower and the consultant, expected
results, and deliverables of the assignment. A comprehensive and clear TOR is
important for the understanding of the assignment and its correct execution. It reduces
the risk of unnecessary extra work, delays, and additional expenses for the Borrower.
In addition, it helps reduce the risk of ambiguities during the preparation of consultant
proposals, contract negotiation, and execution of the services.
Consultants carry out their job of consulting services in accordance with specific
TOR. TOR is usually prepared at the project appraisal phase by the Borrower in
consultation with the lender. Aid organizations or lenders such as the World Bank and
JICA of Japan usually have their guidelines for the employment of consultants, in
which outlines of TOR are spelled out.
(i)
World Bank’s TOR (from Reference 1 Consulting Services Manual of World
Bank 2006)
➢ Background of the Project

The background summaries the main features of the project and describes the
assignment’s key objectives and general purpose.
▻ Name of the Borrower
▻ Project location
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Development Finance, MPP, VJU

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▻
▻
▻
▻
▻
▻
▻

Rationale for the project
Project history (what has been done so far and by whom)
List of relevant studies and basic data
Need for consultants in the project and issues to be resolved
Activities to be carried out by the consultants
Source of financing for the assignment
Supervision arrangement

➢ Objectives of the Consulting Assignment
The TOR precisely describes the objectives and expected results of the
assignment. The typical objectives of an assignment may include the

following:
▻ Sector and strategy studies or assessments
▻ Studies on public sector reform, institutional and regulatory reforms, or
leadership and management change
▻ Master plans or project feasibility before investment
▻ Preparation of bidding documents and project-detailed design
▻
▻
▻
▻

Project management and implementation supervision (monitoring)
Capacity building and training
Collection and analysis of data
Evaluation of Borrower assets for sale (such as in privatization projects)

➢ Scope of Work
This section of the TOR details all the main activities/tasks to be conducted
by consultants and the expected results of the activities/tasks. Generally
speaking, the TOR describes only activities/tasks, not the approach or
methodology by which the results are to be achieved, which is the
responsibility of the consultant who is preparing the proposal.
In the TOR, the scope of work of the assignment is defined by addressing
the following issues:
▻ Relevance of the assignment for the implementation of the project
▻ Definition, scope, and limits of the assignment
▻ Desired level of detail (level of design, accuracy, composition of cost
estimates, and so forth)
▻ Span of projections (time horizon, life span of project components, and
so forth)

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Prof. Koji Fujimoto

▻ Necessary comparison of the assignment with similar projects
▻ Main issues to be addressed
▻ Alternatives to be considered, and the main criteria to be used to
compare them
▻
▻
▻
▻

Required surveys, special analyses, and models
Special equipment requirements
Borrower’s institutional framework, organizations, and legal setting
Transfer of knowledge, objectives, and scope

▻
▻
▻
▻

Language requirements
Units of measurement to be used
Need for continuity, such as data gathering
Quality management requirements

➢ Capacity Building and Transfer of Knowledge
If capacity building and transfer of knowledge are a specific objective of the
assignment, the TOR should provide specific details on the characteristics of
the required services and ask consultants to propose approach and
methodology.
➢ Reports and Schedule of Deliveries
The TOR should indicate the estimated duration of the assignment, from the
date of commencement to the date of the Borrower receives and accepts the
consultant’s final report or specific completion date. The assignment’s
reporting requirement should be clearly specified. The TOR should indicate
the format, frequency, and content of reports, as well as the number of copies,
the language, and the names of the prospective recipients of the reports.
Depending on the assignment, the following reports are usually required:
▻ Inception Report. This report should be submitted shortly after the
commencement date. Any major inconsistency in the TOR, deficiency
in Borrower assistance, or staffing problems that have become apparent
during this period should be includes.
▻ Progress Reports. These reports keep the Borrower and Bank regularly
informed about the progress of the assignment. They may also provide
warnings, of anticipated problems or serve as a reminder for payment
of invoices due.
Depending on the needs of the assignment, progress reports may be
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Development Finance, MPP, VJU

Prof. Koji Fujimoto

delivered monthly or bimonthly. For feasibility studies and design
assignments, delivery of progress reports at two-month intervals is
generally satisfactory. For technical assistance and implementation
supervision (in construction, for instance), monthly progress reports are
submitted. Progress report could include bar charts and photographs for
better and quicker understanding of the status of the project.
▻ Interim Report. If the assignment is phased, interim reports are required
to inform the Borrower of preliminary results, alternative solutions, and
major decisions that need to be made.
The Bank and Borrower should discuss the draft interim report with
consultants in the field. And the Borrower should approve draft interim
reports.
▻ Final Report. The final report (project completion report) is due at the
completion of the assignment.
The Borrower, Bank, and consultants discuss the draft final report.
Although the consultants alone are responsible for their findings.
Changes may be suggested during the discussions. If the consultants
do not accept comments and recommendations from the Borrower,
these should be noted in the report with reasons why the consultants
do not accept them.
➢ Data, Services, Personnel, and Facilities to be Provided by the Borrower
The TOR indicates the inputs provided by the Borrower to the consultants.
Those inputs should include all the information and services that will be
made available by the Borrower, such as the Borrower’s available software
and computer modes to be used by the consultants, office space, vehicles,
survey equipment, office and computer equipment, telecommunication
systems and Borrower’s counterpart staff to the project.
➢ Institutional and Organizational Arrangements
The TOR should define the institutional setup and the organization
surrounding the assignment and indicate the role and responsibilities of all

those involved, specifying the type, timing, and relevance of participation.
The TOR should define the hierarchy and level of authority of counterpart
personnel, as well as the requested level of experience of the Borrower’s
personnel who will be integrated into the consultants’ team.
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(ii)

JICA’s TOR (from Reference 2: Guidelines for the Employment of Consultants
under Japanese ODA Loans 2012)
(The Terms of Reference shall include the items mentioned below. The relevance of an item will depend
on the nature of the project.)
1. Project Information
(1) Background information -- history of the project's evolution and the reason(s) why it is necessary
to implement the project.
(2) Location of the project and information on the surrounding area.
(3) Stage reached in the project's preparation and summary of the findings of studies to date.
(4) Implementing organization.
(5) Details of the major problem areas.
2. Other Relevant Information
(1) Technical information -- availability of relevant basic data, technical standards or specifications
to be used, etc.
(2) Relevant laws and regulations.
(3) Related projects
3. General Terms of Reference

(1) Objectives
(2) Scope of consulting services -- Categories of consulting services to be provided, nature of
consulting work (the latter in detail, including equipment and materials to be supplied by the
consultant). In the case of projects classified into specific categories in accordance with the
relevant environmental guidelines published by JICA, consulting services related to
environmental consideration, such as those described in Section 2.01, shall be included in the
scope.
(3) Nature of and limit to the responsibilities which the consultant is to assume.
(4) Estimated time required to complete (a) the project, (b) the consulting work; number and
qualifications of experts; man-months as estimated by the Borrower for budget purposes.
(5) Scope, number, type and frequency of the reports to be presented by the consultant.
(6) Other necessary provisions regarding the obligations between the Borrower and the consultant
which are stipulated in Guidelines for the Employment of Consultants under Japanese ODA
Loans (e.g. Section 2.02(3), Section 2.06).
4. Specific Terms of Reference
(1) Methodological details relating to the consulting services mentioned above.
(2) Provision for the review of previous studies and for possible additional studies.

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Prof. Koji Fujimoto
5. Services and Facilities to be provided by the Borrower

(iii)

Sample of TOR
See Reference 4 Sample Terms of Reference ADB Project “Outline Terms of

Reference for Consulting Services”.

3. Selection and Employment of Consultants
Multilateral and bilateral financial aid organizations such as the World Bank, Asian

contractors

development Bank, and Japan International Cooperation Agency (Yen loan wing)
possess two types of guidelines: consultant guidelines and procurement guidelines. In
implementing development projects, the Borrower as client first employs consultants
and then enters into (construction) contract with contractors.
The World Bank’s Guidelines
▻ Guidelines Selection and Employment of Consultants by World Bank
Borrowers
(▻ Guidelines Procurement of Goods, Works, and Non-consulting Services
under IBRD Loans and IDA Credits by World Bank Borrowers)
ADB’s Guidelines
▻ Guidelines on the Use of Consultants by Asian Development Bank and Its
Borrowers
(▻ Procurement Guidelines)
JICA’s Guidelines
▻ Guidelines for the Employment of Consultants under Japanese ODA Loans
(▻ Guidelines for Procurement under JICA Loans)
(1) Procedure of Consultant Selection
(i)

Cost: How much
fund

technical quality

Method of Selection
There are a variety of selection methods such as Quality- and Cost-Based
Selection (QCBS), Quality-Based Selection (QBS), Fixed Budget Selection,
Least-Cost Selection, Consultants’ Qualifications Selection, Single-Source
Selection and so forth. Among these, the first two are the most basic selection
methods.
QCBS is a method which takes into account the quality of the proposal
and the cost of the services to be provided. QBC is a method based on
evaluating only the quality of the technical proposals and subsequent
negotiation of the financial proposal and the contract with the consultant who

QBS: technical quality; First

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Two envelope system
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Development Finance, MPP, VJU

Prof. Koji Fujimoto

submitted the highest ranked technical proposal.
QCBS is generally applicable to the following assignments; the scope of
work can be precisely defined, the TORs are well specified and clear, and the
financier (financial assistance organization) or the Borrower and the
consultants can estimate with reasonable precision the personnel time as well
as the inputs required of the consultants. QBS is applicable to the following
types of assignments; complex or highly specialized assignments for which it

is difficult to define precise TOR and the required input from the consultants,

(ii)

assignments where the downstream impact is so large that the quality of
services is of overriding importance for the outcome of the project, and
assignments that can be carried out in substantially different ways such that
financial proposals maybe difficult to compare.
Selection Procedure
The selection methods sated above have their own selection procedures of
consultants. The selection procedures for QCBS and QBS shall include the
following steps individually:
QCBS
(a)
(b)
(c)
(d)

Preparation of TOR and cost estimates
Advertising
Preparation of short list of consultants
Preparation and issuance of the Request for Proposal (RFP) which should
research proposal
include the Letter of Invitation (LOI), Instructions to Consultants (ITC),
the TOR and the proposed draft contract
(e) Receipt of proposals
(f) Evaluation of technical proposals (consideration of quality)
(g) Public opening of financial proposals
(h)
(i)

(j)
(k)

Evaluation of financial proposals
Final evaluation of quality and cost, and ranking of proposals
Negotiations and award of the contract to the selected consultant firm
Publication of award of contract

QBS
(a) Preparation of TOR
(b) Advertising
(c) Preparation of short list of consultants
(d) Preparation and issuance of RFP
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(e) Receipt of proposals
(f) Evaluation of technical proposals and ranking of the technical proposals
(g) The Borrower invites consultant with the highest ranked technical
proposal to submit a financial proposal, or opens a sealed financial
proposal of the consultant already submitted in a separate envelope in the
proposal (two-envelope system).
(h) Negotiations and award of contract to the selected consultant firm
(i) Publication of the award of contract
(2) Request for Proposals (RFP)
The Request for Proposals (RFP) provides all the instructions and information

necessary for the short-listed consultants to prepare their proposals. The RFP, in the
case of the World Bank, includes the following 8 sections: Letter of Invitation,
Instructions to Consultants (ITC) (including the Data Sheet), Technical ProposalStandard Forms, Financial Proposals-Standard Forms (including the appendix on
breakdown of remuneration rates), Eligible Countries, Bank’s Policy – Corruption
and Fraudulent Practices, Terms of Reference, and Standard Forms of Contract.
(Reference 3: Standard Request for Proposals Selection of Consultants, World Bank,
2011)
(i)

(ii)

Section 1: Letter of Invitation
This Section is a template of a letter from the Client addressed to a shortlisted
consulting firm inviting it to submit a proposal for a consulting assignment. The
LOI includes a list of all shortlisted firms to whom similar letters of invitation are
sent, and a reference to the selection method and applicable guidelines or policies
of the financing institution that govern the selection and award process.
(See Page 1 and 2 of Reference 3)
Section 2: Instructions to Consultants
This Section consists of two parts: “Instructions to Consultants” and “Data Sheet”.
“Instructions to Consultants” contains provisions that are to be used without
modifications. “Data Sheet” contains information specific to each selection and
corresponds to the clauses in “Instructions to Consultants” that call for selectionspecific information to be added. This Section provides information to help
shortlisted consultants prepare their proposals. Information is also provided on the
submission, opening and evaluation of proposals, contract negotiation and award
of contract. Information in the Data Sheet indicates whether a Full Technical
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(iii)

Proposal (FTP) or a Simplified Technical Proposal (STP) shall be used.
(See Page 20-29 of Reference 3 on “Data Sheet”)
Section 3: Technical Proposal-Standard Forms
This Section includes the forms for FTP and STP that are to be completed by the
shortlisted consultants and submitted in accordance with the requirements of
Section 2.
(See Page 31 “Check List of Required Forms”, Page 32 & 33 “Form TECH-1:
Technical Proposal Submission Form”, Page 34 & 35 “Form TECH-2 for Full
Technical Proposal: Consultant’s Organization and Experience”, Page 36 “Form
TECH-3 for Full Technical Proposal: Comments and Suggestions on the Terms of
Reference, Counterpart Staff, and Facilities to be Provided by the Client”, Page
37 “Form TECH-4 for Full Technical Proposal Only: Description of Approach,
Methodology, and Work Plan Responding to the Terms of Reference”, Page 38
“Form TECH-4 for Simplified Technical Proposal Only: Description of Approach,
Methodology, and Work Plan for Performing the Assignment”, Page 39 “Form
TECH-5 for FTP and STP: Work Schedule and Planning for Deliverables”, and
Page 40 & 41 “Form TECH-6 for FTP and STP: Team Composition, Assignment,

(iv)

(v)
(vi)
(vii)

Key Experts’ Inputs”, and Page 42 & 43 “Form TECH-6 for FTP and STP:

Curriculum Vitae” of the above Reference 3)
Section 4: Financial Proposal-Standard Forms
This Section includes the financial forms that are to be completed by the
shortlisted consultants, including the consultant’s costing of its technical proposal,
which are to be submitted in accordance with the requirements of Section 2.
(See Page 46 & 47 “Form FIN-1: Financial Proposal Submission Form”, Page 48
“Form FIN-2: Summary of Costs”, Page 49-53 “Form FIN-3: Breakdown of
Remuneration”, Page 54 “Form FIN-4: Breakdown of Reimbursement Expenses”
of the above Reference 3)
Section 5: Eligible Countries
Section 6: Bank’s Policy – Corrupt and Fraudulent Practices
Section 7: Terms of Reference
This Section describes the scope of services, objectives, goals, specific tasks
required to implement the assignment, and relevant background information;
provides details on the required qualifications of the key experts; and lists the
expected deliverables. This Section shall not be used to over-write provisions in
Section 2.
(See Page 59 “Section 7. Terms of Reference” of Reference 3.)
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(viii) Section 8: Standard Form of Contract
This Section includes two types of standard contract forms for large or complex
assignments: a Time-Based Contract and a Lump-Sum Contract. Each type
includes General Conditions of Contract (“GCC”) that shall not be modified, and
Special Conditions of Contract (“SCC”). The SCC include clauses specific to each

contract to supplement the General Conditions.
4. Proposal Evaluation and Costs of Consulting Services
(1) Proposal Evaluation
In both QCBS and QBS, the technical proposal is first evaluated, followed by the
financial evaluation. The technical proposal evaluation is in fact the evaluation of
“quality” of consulting services/assignment. The financial proposal evaluation is
literally the evaluation of “price” of consulting services/assignment. Both evaluations
are carried out by using numerical ratings. The Borrower prepares a summary
evaluation sheet for technical proposal as well as that for financial evaluation. And
then, in case of QCBS, the total score of each short-listed consultant is obtained by
weighting and adding technical and financial scores, which determines the overall
ranking of the consultants’ proposals.
(i) Technical Evaluation
Generally speaking, the criteria of technical evaluations covers three items:
Experience of Firm, Methodology and Work Plan, and Personnel/Staff. Weight in
terms of points is given to each of these three items in such a formula (which varies
depending on the type and nature of the project) as 20-30-50.
In Table 1, a sample case is shown. Each item is composed of sub-items and the
third item Personnel/Staff is usually divided into international staff (international
recruited staff) and local staff (domestically recruited staff). It is expected that the
international staff will transfer technology to the local staff. The technical evaluation
ranks the firms based on total score/points obtained. However, firms who do not clear
either the total pre-fixed qualifying score or the item-wise score shall be disqualified.

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Table 1 Technical Evaluation
Name of Consulting Firm
Selection Criteria *1

Consulting Firm A
Weight (w)*2 Rating (r)*3

I. Experience relevant to the assignment
1. Experience of international projects of
comparable size, complexity and technical
speciality
2. Experience in developing countries under
comparable conditions
II. Proposed methodoligy and work plan
1. Approach and methodoligy
2. Work plan (including staffing schedule)

20

III. Personnel

50

10

70

10
30

15
15

Score
(w) x (r)
16.00

Consulting Firm B
Rating (r)

Score
(w) x (r)
19.00

Consulting Firm C
Rating (r)

7.00

90

9.00

100

90

9.00

100

10.00

70
70

21.00
10.50
10.50

90
90

27.00
13.50
13.50

38.05

42.19

Score
(w) x (r)
19.00

Consulting Firm D
Rating (r)

Score
(w) x (r)

16.00

10.00

80

90

9.00

80

8.00

70
90

24.00
10.50
13.50

95
85

27.00
14.25
12.75

41.65

8.00

32.15

International staff
35
26.85
29.84
29.30
32.15
1. Project manager/road engineer
15
75
11.25
90
13.50
80
12.00
95
14.25
2. Transport economist
7
80
5.60
80
5.60
80
5.60
100
7.00

3. Environmental expert
8
75
6.00
78
6.24
90
7.20
80
6.40
4. Social sector analyst
5
80
4.00
90
4.50
90
4.50
90
4.50
Local staff
15
11.20
12.35
12.35
13.30
1. Road engineer
5
80
4.00

90
4.50
75
3.75
95
4.75
2. Transport economist
3
70
2.10
80
2.40
90
2.70
85
2.55
3. Environmental expert
4
75
3.00
80
3.20
80
3.20
90
3.60
4. Social sector analyst
3
70
2.10

75
2.25
90
2.70
80
2.40
Total
100
75.05
88.19
84.65
88.45
Rank
4
2
3
1
*1 Additional items may be used and criteria included above may be deleted, as appropriate.
*2 The weight distribution will depend on the type and natue of the project.
*3 The rating categories shall be devdided and shown in % as "Excellent 90 - 100", "Good 80 - 89", "Average 60 - 79", "Below average 40 - 59", "Poor 0 - 39".

(ii) Financial Evaluation
The Borrower should first review the financial proposal for arithmetical errors and
inconsistencies (e.g., staffing schedule inputs, number and duration of field trips,
applicable per diems, etc.) between the financial and technical proposals. Arithmetical
errors and inconsistencies as well as omissions should be corrected.
Thus, the evaluated financial proposal is prepared, and in order to compare
proposals, evaluated prices should be converted to a single currency (often US$) using
the exchange rate, date, and source indicated by the Borrower in the RFP. The scores
of the evaluated prices should then be calculated according to the formula provided

in the RFP.
Let us assume that the consulting firm A’s evaluated price is US$ 0.5 million, the
consulting firm B’s US$ 0.6 million, the consulting firm C’s US$ 0.65 million and the
consulting firm D’s US$ 0.7 million. We, then, give the firm of the lowest price the
highest point 100 and the firm of the highest price the lowest point 71.4 (=100 x
0.5/0.7) calculated regressively. Prices are thus converted into points as shown in the
following table.

16


Development Finance, MPP, VJU

Prof. Koji Fujimoto

Table 2 Financial Evaluation

Consulting Firm A Consulting Firm B Consulting Firm C Consulting Firm D
Evaluated Cost/Price
(US$ million)

0.5

0.6

0.65

0.7

Rating Point

Based on Evalutaed
Cost/Price

100

83.33

76.92

71.43

(iii) Overall Evaluation and Ranking
In case of QCBS, the technical and financial proposals are combined to obtain overall
ranking of the consulting firms. In order to combine the proposals, weight of 80% is
often given to technical evaluation and weight of 20% to financial evaluation. And
then the combined scores are calculated to rank the consulting firms. Table 3 is a
sample overall evaluation table.
The Borrower invites the consultant whose proposal obtained the highest
combined score to negotiate for award. In our present case, the firm B is the highest
score firm.
Table 3 Overall Evaluation
Weighted
Technical
Score
(St) ｘ (Wt)

Rating Point
based on Net
Evaluated
Cost/Price

(R)

Weight for
Financial
Proposal
(Wf)

Weighted
Financial
Score
(R) x (Wf)

Overall Score
(Technical
and Financial
Scores
Combined)

Rank

Consulting
Firm

Technical
Score (St)

Weight for
Technical
Proposal
(Wt)

A

75.05

0.80

60.04

100.00

0.20

20.00

80.04

4

B

88.19

0.80

70.55

83.33

0.20

16.67

87.22

1

C

84.65

0.80

67.72

76.92

0.20

15.38

83.10

3

D

88.45

0.80

70.76

71.43

0.20

14.29

85.05

2

(2) Costs of Consulting Services
Consultants receive consulting fees for consulting services performed in accordance
with TOR. The consulting fees are composed of three components as follows:
(i) Remuneration of Staff Consultants
Total amount of remuneration is calculated on the basis of an equation: R = Staff
Billing Rate x Person-Month (Man-Month).
17


Development Finance, MPP, VJU

Prof. Koji Fujimoto

A breakdown of staff billing rate includes such elements as salary, bonuses,
social charges, cost of leave, overheads, profit/technical service fee, away-fromhome-office allowance. It is often argued that the billing rate is obtained by “salary
times a multiplier which ranges from 2.4 to 3.0”.
As staff consultants are consisted of foreign and local staff, staff billing rates

are calculated in foreign currency for foreign staff and local currency for local
staff.
(ii) Direct Cost/Reimbursable Expenses
The direct cost, or the reimbursable expenses in other words, includes
international travel, hotel and per-diem, communication and transport, car rent,
office furniture, office rent, report preparation and printing, data processing, field
survey equipment, local staff and so forth.
(iii) Contingencies việc bất ngờ
very important
There are two kinds of contingencies; price contingency and physical
contingency. The price contingency means that the consultant’s contract provides
for price escalation in foreign and local currency and the physical contingency is
also included in the contract to cover unexpected or unforeseen volume of
consulting services to be provided. The former is calculated by utilizing an
expected inflation rate, while the latter allowance is often 5~10 % of contract
value.

Reference 1: Consulting Services Manual of World Bank 2006
Reference 2: Guidelines for the Employment of Consultants under Japanese ODA
Loans 2012)
Reference 3: Standard Request for Proposals Selection of Consultants, World Bank,
2011
Reference 4: Sample Terms of Reference ADB Project “Outline Terms of Reference
for Consulting Services”.

18

tăng bất
ngờ

19

Beneficiaries
/Clients of
TA for Preinvestment
Studies

TA for Preinvestment
Studies

Beneficiaries
/Clients of
TA for
Regional/Sec
tor
Development
Plan

TA for
Formulation
of
Regional/Sec
tor
Development
Plan

Beneficiaris/
Clients of TA
for National

Development
Plan

TA for
Formulation
of National
Development
Plan

Participation
in F/S as
Representati
ve of
Residents

Participation
in Preinvestment
Studies as
Representati
ve of
Residents

Participation
in Planning
as
Representati
ve of
Residents

Participation

in Planning
as
Representati
ve of
Residents

Consultants

CSOs/NGOs

Contractors
(Construction
Companies)

Documentati
on of
Feasibility
Study as
Consultant
Job

Documentati
on of Preinvestment
Studies as
Consultant
Job

TA for
Feasibility
Study

Regional/Sec
tor
Development
Plan
Formulation
as Consultant
Job

Financial
Assistance
Agencies

Feasibility
Study

Preinvestment
Studies

Regional/Sec
tor
Development
Plan

National
Development
Plan

Beneficiaries
/Clients of

TA for
Feasibility
Study

Project
Preparation

Project Identification

National
Development
Plan
Formulation
as Consultant
Business

Aid
Organizatio
ns (Muitiand BiAgencies)

Technical
Assistance
Agencies

Governments of
DCs/Recipient
Governments

Consulting Services

Project Cycle

Sources: Engineering Consulting Firms Association of Japan, Overseas Economic Cooperation Fund of Japan and Author

Stakeholders

Figure 1 Project Cycle, Stakeholders and Their Roles

Partial
Support for
Appraisal, if
necessary, as
Consultant
Job

Appraisal
Report
Documentati
on by FA
Agencies
(Internal
Procedure in
principle)

Supporting
Services for
Appraisal

Project
Appraisal

FA
Agencies'
Own
Responsibility
(Internal
Procedure)

(No
Services)

L/A Nego.
And Board
Presentation

Approval of
Bid
Evaluation by
FA Agencies

Documentati
on of Bid
Evaluation
Report as
Consultant
Job

Detaied
Design &
Bidding

Documents
Preparation
as Consultant
Job

Beneficiaries
/Clients of
FA
(Recipient of
Consulting
Services)

Beneficiaries
/Clients of
FA for
Design &
Bid
Preparation
(Recipient of
Consulting
Services)

Approval of
Bidding
Documents
by FA
Agencies

Bid
Evaluation

Design &
Bidding
Document
Preparation

Construction
Contract with
Recipient
Government

Documentati
on of
Progress
Report as
Consultant
Job

Monitoring as
FA Agencies

Beneficiaries
/Clients of
FA
(Recipient of
Consulting
Services)

Monitoring

Project Implementation

(Local Staff
Training for
Operation as
a Part of
Constraction
Contract)

Local Staff
Training for
Operation as
Consultant
Job

(A
Component
of FA)

Beneficiaries
/Clients of
FA
(Recipient of
Consulting
Services)

Training for
Operation

(Local Staff Training for O

& M as a Part of
Construction Contract)

Post-Evaluation Partly or
Fully by Third Party
Consultant as Consultant
Job, O & M Services as
Consultant Job

Objevtive Post-Evaluation
by FA Agencies and/or
Third Party, O & M is
Taken Care of by Recipient
Governments

Beneficiaries/Clients of
Post-Evaluation Undertaken
by FA Agencies, O & M is
Taken Care of by
Recipient Governments

O & M Services

Project Performance
Evaluation

Project
Project Post-Evaluation
Completion

Development Finance, MPP, VJU

Prof. Koji Fujimoto