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RFP Workshop

Join Brian Lines, Ph.D., for a workshop in Kansas City on RFP development and evaluation. Learn best practices for creating successful RFPs and avoiding common pitfalls. Gain valuable take-away tools and insights to improve your procurement process.

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RFP Workshop

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  1. RFP Workshop Kansas City Procurement Round Table Brian Lines, Ph.D Assistant Professor University of Kansas Dept. of Civil, Environ. & Arch. Engineering brianlines@ku.edu 785-864-6503

  2. Agenda

  3. Scope Development • Share the Project’s Constraints • Don’t be Overly Prescriptive • Focus on Current Conditions • Include an appropriate Vision Statement • Ask Vendors what they Need Take-Away Tools • White Paper on “The Budget” • SOW Template • RFN Template

  4. RFP Development • Keep it Short – Proposal Page Limits • Focus on the People – look beyond the Logo • Keep it Open – Minimize “Pre-Selections” • Treat Price Fairly • Compete on Expertise – Risk & Value Take-Away Tools • Sample Interview Questions • Price Proposal Template for IT • RFP Report Card

  5. Evaluation Procedures • Blind Evaluations – Keep it Fair • Streamlined Scoring – Keep it Simple • Individual Evaluations – Avoid Groupthink • Offer Detailed Debriefings • Plan Before You Sign Take-Away Tools • 1-5-10 Evaluation Scale • Evaluation Scoresheets • Evaluation Matrix • Debriefing Template

  6. Introduction

  7. A Note on Terminology… Owner / Client / Buyer • The buyer, purchaser, receiver of services • Includes Procurement & Operations/PM • Internal user groups are the “Client’s Client” Vendor / Contractor / Designer / Engineer / AEC / Proponent / Consultant / Software Provider • The “doers”… different terms for each industry sector Scope of Work / SOW / Specifications / Statement of Work / Minimum Requirements / Minimum Qualifications / Technical Requirements RFP / RFQ / Tender / Solicitation

  8. Introductions…

  9. IT Industry Performance • 28% of projects are Successful • 46% of projects are Unsuccessful • 26% of projects Completely Failed or Cancelled • 202% average Cost Overrun • 111% average Schedule Overrun The Standish Group, Chaos Reports – Collects case study information on IT failures. Studies 70,000+ projects in 15 years (Everleens and Verboef 2010)

  10. Successful = essentially on-time, on-budget, with all features specified. • Challenged = complete & operational, but over-budget, over-schedule, and offers fewer features than specified. • Failed = cancelled at some point during development/implementation cycle or not used after implemented

  11. IT Industry(Geneca, 2011) • In a study conducted with 593 business and IT professionals: • 80% admit they spend at least half their time on rework, which is the result of unclear objectives, confusion of roles and responsibilities, and lack of stakeholder involvement. • 75% of respondents believed that their IT projects are either always or usually “doomed” from the start • 78% feel that team is ‘out-of-sync’ when it comes to project objectives • 61% of the projects take longer than anticipated • 57% of the projects are not considered a success • 55%were confident that they objectives of their IT projects are clear • 38% are confused about their team roles and responsibilities • 31% believe there is a lack of common vision on project success criteria

  12. IT Industry(Kappleman, McKeeman, Zhang, 2006) (Bloch, Blumberg, Laartz 2012) • Research conducted on 5,400+ IT projects: • Had a cost overrun of $66 billion • 50% of all large IT projects ($15+ million), massively blow their budgets • Black Swans = Budget overrun of +200% • The average cost overrun is 45% over budget • The average delay rate is 7% over time • 56% delivered less value than predicted / expected. • On projects over $15M: • Major causes for cost overruns are unclear objectives, lack of focus, and shifting scope

  13. Early Warning Signs of IT Project Failure (Kappelman et al. 2006) • Identified 53 “early warning signs” • Grouped into 3 categories: • People Risks: behavioral • Process Risks: managerial • Product Risks: technological • Surveyed + Interviewed IT project managers • Average 15+ years of experience • Largest projects they managed were $3M to $7B • Project/program manager, IT consultants, analysts, VPs, executives.

  14. The “Dominant Dozen” (Kappelmanet al. 2006) People-Related EWSs: Lack of top management support. No stakeholder involvement and/or participation. Weak project manager Weak commitment of project team. Team members lack requisite knowledge and/or skills. Subject matter experts are overscheduled.

  15. The “Dominant Dozen” (Kappelmanet al. 2006) Process-Related EWSs: Lack of documented requirements and/or success criteria. No change control process (change management)No stakeholder involvement and/or participation. Ineffective schedule planning and/or management Team members lack requisite knowledge and/or skills. Communication breakdown among stakeholders. Resources assigned to a higher priority project. No business case for the project.

  16. Fun Facts • Only 2.5% of projects defined as successful (scope, cost, schedule, & business) • PricewaterhouseCoopers, 2009 • Only 30% of projects completed within 10% of the planned cost & schedule • Construction Industry Institute Performance Assessment Committee, 2015 edition • 24% growth in owner’s construction indirect costs since 1995 (adjusted for inflation) • Construction Industry Institute Performance Assessment Committee, 2015 edition

  17. New Study: Charles Pankow Foundation and CII • Data shows no performance difference between delivery systems (DBB, DB, CM@R) • Only key difference makers: • Qualifications-based selection of project team • Involvement of key people earlier in the project • Cost transparencythroughout the project

  18. Just because it’swritten in the contract does not make it so

  19. Who says they are the best for the job? High Performer (Low Risk) Vendor 1 Vendor 2 Vendor 3 Vendor 4 Low Performer (High Risk)

  20. What We Have Seen… Vendor Vendor Promises Client RFP ($) • Vendor • Vendor Vendor

  21. What We Have Seen… RFP ($) Client Vendor

  22. What We Have Seen… RFP ($) Client Vendor Vendor PM Client PM ?

  23. “The greatest risk I faceis how to accomplish all of the things that our sales team promised we could do.”

  24. Who brings the Client the most Risk? High Performer (Low Risk) Vendor 1 Vendor 2 Vendor 3 Vendor 4 Low Performer (High Risk)

  25. Characteristics of a good Client? • Pays on Time • Fair • Transparent • Open • Values expertise • Does not micromanage • Listens • Wants their vendors to make a fair profit

  26. Simplar Research Institute Primary Research Objectives: • How do experts deliver projects? • How do experts deliver programs/portfolios? • Organizational development • Organizational change management

  27. 20+ Years | 210+ Publications | 130+ Partners 2,500+ Projects | $11+ Billion Procured Facility Management Information Technology Health Insurance/ Medical Services maintenance landscaping security service building systems industrial moving waste management energy management custodial conveyance pest control Networking Data centers Hardware COTS software ERP systems Help desk services eProcurement Manufacturing Construction/Design/Engineering Business/Municipal/University Services Dining Services Multi-media rights Fitness equipment Online education Document management Property management Communications systems Recycling Bookstores Laundry Audio Visual Retirement Funds Infrastructure Municipal Laboratory Education Hospital Financial Specialty Renovation Repair Maintenance Roofing Demolition Development Supply chain DBB CMAR DB IDIQ JOC Low Bid IPD

  28. Strategic Partners & Efforts 7+ years Infra/IT/Equip €4B+ Canada15 Owners 5 Provinces Tongji University United States 70+ Owners 37 States Malaysia Complete Supply Chain Fulbright Scholarship- University of Botswana BV tests RMIT Teaching IMT PBSRG platform

  29. Other Current Partners

  30. Simplar Research Institute • Minimize Cost by increasing Efficiency • Attract & contract with high performing teams • Leverage expertise into project operations • Get what you paid for and be able to prove it • Become a Client of Choice • Build a Region of Excellence • Facilitate Organizational Change and Development • Benchmarking, exploratory talent development • Hands-on Change Integration

  31. Expertise-Driven Project Delivery (XPD) CONTRACT AWARD 0 SCOPE DEVELOPMENT PERFORMANCE METRICS PROCUREMENT & SELECTION PRE-AWARD CLARIFICATION

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