Managing the RFP Process Wisely

Every CIO I know is always on the lookout for better and more efficient ways to select and manage vendors for staffing and project engagements.

One of the key elements in this decision-making process is the judicious use of RFPs. I say “judicious” because if the RFP (request for proposals) is done properly, it will generate responses that allow you to select vendors who provide the greatest value.

As noted in a recent research brief developed by the National Association of State Chief Information Officers, which represents government CIOs, and National Association of State Procurement Officers, “‘[b]est value’ is a term of art in procurement circles that is different from ‘best or lowest price.’

“While ‘best price’ is simply that—the best or lowest price for which a product or service may be purchased—‘best value’ encompasses the benefits in total … and typically means ‘the expected outcome of an acquisition that … provides the greatest overall benefit in response to the requirement.”

It may be easier said than done to create an effective RFP, however. The first question to ask is when an RFP is the right way to select your vendors. What follows are some brief criteria to apply and benefits to be gained:

  • An RFP makes sense when there is a defined end product and the investment in the process is appropriate for the benefit to be gained.

    Going through the process can be difficult and costly in terms of resources required for planning, development and evaluation, and you should weigh these resource costs against what you hope to gain through the use of an RFP.

  • Your objective in using an RFP should be to clarify your needs, outline the parameters that help the vendor develop a suitable plan and provide a mechanism for the vendor to frame the approach, describe relevant experience and develop an estimate that is reasonable and within your budget.
  • Done properly, the RFP process will result in higher quality, more consistent responses that can be evaluated and compared more easily, on an “apples-to-apples” basis.

    If not done properly, it can waste your time and that of your colleagues (not to mention that of the well-qualified vendors who may become frustrated by the process and opt out of future opportunities to do business with your organization.)

  • The RFP also helps build relationships with well qualified vendors, leading to longer term and more successful dealings that will be beneficial to your organization and maximize your investment.
  • Developing the RFP

    The planning process begins with identification of stakeholders who should be involved. Although this will vary from organization to organization, it typically includes the CIO, the appropriate procurement executive, the CFO or designated financial representative, a legal department representative and the end users of the technology.

    Including them throughout the process will not only result in buy-in for the final selection, but will also provide substantive input that will generate a more comprehensive RFP.

    The process continues with identification and preliminary research related to potential vendors. If your company works only from approved vendor lists, this may already have been done. If your requirements cannot be met by those vendors, you will want to identify and qualify vendors who offer the proper capabilities.

    Once this is accomplished, you should define your specific needs. Meet with your stakeholders to gain written agreement on what you are looking for. If this step is ignored or truncated, the RFP will be too generic or undefined, and will not yield the level of response that allows you to make an informed selection.

    As for the actual document, not everyone can write an effective RFP. If you don’t have the internal capabilities, your options include bringing in someone who is experienced and skilled at the process, using a previously successful tool, or buying a tool or template.

    One word to the wise: if you ask a vendor to assist in writing it, don’t allow that vendor to bid on it.

    Your RFP should be clear and straightforward, designed to generate “apples-to-apples” comparison in responses. Define your expected outcomes, cost expectations, delivery time frames, geographic requirements, breadth of services and other key elements.

    Criteria should be outlined crisply and concisely. Many of us have seen the alternative: the loosely written RFP that doesn’t clarify needs, expectations and deliverables.

    This has at least two negative consequences. First, vendors will be all over the board in responding, requiring more resource time for the evaluation process. The second and related consequence is that there will be little or no consistency in the evaluation process.

    Set and adhere to reasonable expectations. Allow enough time for respondents to develop a thorough, well-priced proposal, but not so much time that your project will suffer. The appropriate time line should be dictated by the magnitude of the project. Then review and make the award within a reasonable time frame.

    When it’s time to evaluate responses, you’ll see the results of a properly- developed RFP. If it was developed properly, evaluation criteria and relative weighting will have been built into the design. This should simplify the review process and gain you the respect (and gratitude) of your review committee.

    Dan Cobb, a former CIO, is vice president of National Sales for Kforce Professional Staffing. He can be reached at [email protected].