My observations and opinions on HK government operation

已更新:4月8日

With my limited experience working for the HK government, I found the following issues:


Procurement Procedures

  1. The HK government procurement policies restrict all officials to issue public tenders for any procurement with more than a certain threshold like HKD1.5 million, a Request for Quotation (RFQ) above HKD150,000. Any purchase below HKD150,000 can be treated as a standard purchase.

  2. The tenderers need to submit two proposals separately: The technical proposal and the Financial proposal which rate 70% and 30% respectively. Normally, the tender owner would contact all potential suppliers to understand their background and products or services features. The tender owner will write up the tender requirements based on the internal requirement plus information they research and collect from the vendors.

  3. For each tender, there is a group of approvers who are the key stakeholders of the projects. For example, the IT department wants to purchase software, the stakeholder's group contains the IT department head, all related User departments' heads, etc. If the project involves cross-department operation, the approval team will be very dynamic.

  4. The whole tender process will be monitored by the procurement team to ensure legitimacy.

  5. The legal department is another bottleneck of the tender procedure. There are only a few legal staff in each government department but they require to review and approve all RFQ and tenders in that department. The legal staff is normally very strict and rigid, their point of view and opinions only focus on legal terms. For example, they can request a major vendor like Microsoft to follow their rules and guidelines instead of Microsoft's standard contract for a small amount purchase. The legal department review period can take 3 months to even a year. They can even turn down the whole procurement decision. This is very ridiculous.

  6. The tenderers are required to present their proposal to the approval team. This is very time-consuming if they receive many tenderers for a particular proposal. Besides, the department heads are very busy and there are many tenders being processed at a particular time. Thus, all the department heads are normally the bottleneck of the procurement procedures.

  7. The tender owner will write up the technical evaluation criteria for the approval team to assess. Therefore, no one can dictate the purchasing decision, all approvers have the equivalent right.

  8. Once the tender is opened, evaluated, and scored. Then they can open up the Financial proposals. They sum up the technical score and financial scores to come up with the final score.

  9. There are some issues with this approach. Some vendors especially some unknown and small vendors offer extremely low costs so as to bid the tender. Their objective is to acquire the endorsement and government experience to improve their companies' reputation. Since they offer extremely low costs to win the tender, they must provide poor quality staff and service to fulfill the tender requirement.

  10. On the other hand, there is a lot of room for people to manipulate the whole procurement procedure, the government officials can collude with the vendors to win the tenders.

  11. The whole procurement procedures are extremely time-consuming and ineffective.

Management Principle and Policy

  1. There is no clear mission and vision of the Hong Kong government. The policy of the precedent Hong Kong Chief Executive can be overthrown by the next executive. There is no continuity for long-term policy.

  2. There is no merit and punishment system in the Hong Kong Government, no one needs to bear any responsibility for their faults.

  3. Hong Kong government is lacking planning, there are no clear annual goals and objectives for each department or staff. It seems that the government staff has no obligation to Hong Kong citizens.

  4. I suggest the Hong Kong government should adopt a private enterprise model like management by objective with solid deliverables and goals.

Staffing

  1. In additional to 180,000 government staff, there are numerous government contractors who don't entitle to any government welfare and benefits. From my observation, government officials like to offload their works to those contractors. The working morale for those contractors is normally very low.

  2. From my understanding, the recruitment criteria of the Human Resource is very old fashion. Since there are too many candidates who want to join the HK government, their selection and assessment criteria for a senior position can down to high school open examination scores. In a sense, those top students in HK universities have a better chance to join the HK government. Unfortunately, those students are the ones who are being brainwashed the most.

Compensation

  1. Hong Kong government follows a ranking scheme that every official can jump point in every few years. This is in a way of promotion. Although the annual salary increment rate is low, many officials increase their salary by jumping points.

  2. The pension fund and welfare is based on the ranking point of the last position. This is the biggest financial burden of the HK government.

  3. Besides, many senior officials can manipulate the ranking system to attract followers to join their political side.

  4. The Hong Kong government likes to outsource low-level works to contractors with very poor compensation. For example, the Hospital Authority outsources all the cleaning and healthcare services with low costs. It costs a lot of management and quality problems of the services.

Operation efficiency

  1. The HK government operation is not efficient and effective with low productivity. The main reason is that IT resources only focus on projects. There is no bandwidth to support operational efficiency and productivity.

  2. Many business processes are very bureaucratic which involves too many stakeholders, Business processes re-engineering are required to improve the effectiveness and efficiency.

Consultancy

  1. The Hong Kong Government gets used to hiring external international consultancy for most of their policies and projects. For example in 2019, Carrie Lam explained to the public that the Hong Kong government failed to hire PR firms to rescue the battered image.

  2. Hong Kong protests: government fails to find PR firm to rescue battered image

  3. Almost all of the senior government officials are the elites in Hong Kong, there is certainly a PR department with many PR professionals. Why did they need to hire international PR firms to solve the Hong Kong image problem? It is even more ridiculous that Carrie Lam used this as an excuse for the 2019 color revolution failure.

  4. It is a legal and official way to allow external foreign forces to interfere with Hong Kong affairs by hiring an external consultancy. And the traitors in the Hong Kong government can easily shirk responsibilities for their misconduct.

  5. For some departments like IT which involve technical skills, consultancy is important because IT technologies change rapidly and each technology is extremely unique. However, the Hong Kong government depends on external consultancies for all aspects.

  6. It is extremely dangerous and risky to allow agencies of the Satanic Cabal to interfere with Hong Kong's internal affairs which are opposite to the policy of China.


Business Values

  1. Every employee has a staff cost associated with the time he/she spends on the tasks. We should have a proper business values evaluation to determine if a project is worth doing based on the ROI. This is a very scientific calculation to justify our decision.

  2. Since the tender process is very rigid and time-consuming, the staff cost for the tender is also very costly. Below is an example of a regular IT cross-department tender with small to medium complexity like a 2 Million Project, the whole tender process involves a lot of participants in meetings etc. The time hours are only a rough estimation. The staff cost of the whole tender process can cost more than HKD860,000.

  3. It doesn't count the time for delay of the project because all department heads, legal staff are extremely busy. The delay of the project can cost the increment of the actual subsequent development and material costs.

  4. So, the question is how much time, effort and money did we spend on the tender process. What is the purpose of the complicated procurement policies, does it justify the business values?

  5. There are 14 government bureaus and 62 government-funded organizations in Hong Kong, they all follow the same procurement policies. I roughly estimate the total tender cost based on assumed procurement counts. This is just a rough estimation without solid data for support, I just want to provide you with a methodology and templates for calculating the operation hidden costs for the procurement policy.

  6. This is certainly worth re-evaluating the purpose, costs, and benefits of Hong Kong government procurement policies.






To further illustrate the cost-saving:

  • Assuming we can save 50% of the time after procurement process simplification

  • 609000 man day of resources are free up to do more valuable tasks

  • Normally only senior officials would involve in tender preparation and approval, the HK government current hire external consultants who may be less qualified personnel to conduct projects

  • The normal standard rate for a junior consultant is at least 12,000 per man-day


Actual Cost-saving

  • 609000 man-days saved to replace consultancy man-days (609000 * 12000) = 73Billions

  • Reduce consultancy contracts for huge saving

  • Improving the quality of the tender work induce potential productivity gain

  • Reduce complaints (Complaint department workload and saving)

  • Speed up the projects - induce cost saving on materials and development cost

  • Reduce errors (induce cost saving on maintenance cost)

The whole point is to quantify and monetize all benefits after simplification, that is the total cost saving of the re-engineered process


The government overspending problem has been happening for a very long time. Carrie Lam, her subordinates, and many consultants, who are the top elites and professionals, have been working in the HK government for 30 years. She never took any action to cut the huge operation expenditure, she instead shift the financial burden to the Hong Kong citizens. This government is dictatorial and extremely selfish.

Tender Administration Cost 20220123
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