Well, lets imagine, you are an ordinary corporate. And you have hunch on great things, because you have seen presentation from lots of vendors, or you get your ideas from trustful source.
But you can’t do all work alone. Even in your company it’s hard to gather resources, as other people are in their daily routines. You need a vendor. You also managed to convince your manager (lets discuss in another post). Now the procurement steps in and tries to bury all your great ideas.
Well at first it’s good to say, that procurement is not an enemy. It’s just necessary to show them a skill, before you will become a partner for them, which changes the whole discussion.
Subject of work
So lets say, you want something from specific vendor. First, before reaching procurement, lets formulate what it is. Maybe it’s one thing, maybe it’s a list of things, you want to delivery in harmony together.
Now you can approach procurement and they will probably start creating a proposal based on pricing criteria. It’s obvious. Not that because they are stupid, but because they will probably not understand the complexity of your topic.
Sucess criteria
So to enlighten them, take your time and formulate target criteria on which you will consider your whole project sucessful. It will mostly consist of following dimensions – of course, you can be more specific, but I cannot in this article as I don’t know what you need.
We can split this criteria to soft/hard, but that’s up to you. Best way is to have most of the criteria on hard side (if you can set hard measures for them):
- Scope – everything you need to deliver, including vendor specific technologies, which could favor one vendor.
- Quality – can you assure somehow quality? If so, put acceptance criteria as mandatory part of the scope.
- Example delivery – on simple example you define, vendor will provide solution. You can see the quality the way of work and even the time flexibility when they will deliver.
- Time – delivery of whole scope has to be before some data.
- Price
- Price for delivery – price for main scope.
- Hourly / daily rate for additional work – there will be always additional work, so put some weight on this too.
- Price for support of solution – especially for digital deliveries, you will need support. If you forgot to ask upfront, the price could be very unpleasant after project is alive.
- Demo / Presentation of vendor
- Reference
Your procurement will for sure add more. But don’t leave these ones to them, as they are not in charge of your project.
You can also split the vendor evaluation to more phases, so in the first phase they don’t need to create an example of delivery.
Criteria weights
Now comes the issue, how will I evaluate the tender?
Lets first setup KO criteria – that means, if the vendor doesn’t deliver for example mandatory part of scope, or in this year, you cannot pick him, as your project would fail.
After that, you can put your other criteria and assign weight percentages.
| Scope | Time | Price | Quality | Reference | |||||
| Criteria name | Item 1 | Item 2 | Possible start | Lastest end | Price for delivery | Price for support | Price for change requests | Demo / presentation | Company |
| Criteria type | KO | KO | Percentage | KO | Percentage | Percentage | Percentage | Percentage | Percentage |
| Vendor1 | |||||||||
| Vendor2 | |||||||||
| … |
Creating contract
To ensure you will succeed in your project, engage your vendor and let your procurement help you incorporate this criteria into contract. You can also put fines if contract breached on each of them, so that vendor has some motivation.
Resume
Lowest price did not won, tender had clear objectives and can be audited any time. Also, you have quantified your decision and can defend it from corporate sharks. Win-win.
Game Changer 