The Board of Directors of Omega Consolidated Industries approved $180 million to build a new manufacturing facility in China. A team was tasked with soliciting proposals and selecting a contractor. The team received three proposals by the deadline and a fourth proposal several days late. At a meeting to discuss the proposals, team members disagreed on whether to consider the late proposal and which contractor to recommend. The team must decide how to proceed with evaluating the proposals and making their recommendation to meet the required deadline.

1. New Manufacturing Facility in China
At its January 15 meeting, the Board ofDirectors of Omega Consolidated Industries made a decision to
builda new manufacturing facility in China and approved funding up to $180 million for construction
and start-up activities. It wants the new facility completed within two years from the date that a contractor
is selected to design and build the facility. Omega is a worldwide corporation with its headquarters in
London.
The Board asked I.M. Uno, Omega's president, to assign a team to develop a Request for Proposal
(RFP) and solicit proposals from contractors to design and build the facility, including installation ofall
production equipment, oftices, and an integrated information system. The team would also be responsihla
for monitoring the performanceof the selected contractor to ensure the contractor fulfills all contractual
requirements and pertormance specifications.
Ms. Uno selected four members of her management team:
Alysha Robinson, who will be the plant manager ofthe new facility
Jim Stewart, Chief Financial Oficer
Olga Frederick, Vice President of Engineering
Willie Hackett, Procurement Manager
The team chose Alysha as their team leader. By April 30 they developed a comprehensive RFP that
included:
A
statementofwork describing the major tasks that the contractor must complete, as well as the
performance specifications for the production capacity of the facility,
A requirementthatthe contractor complete the project within 24 months after a contract is signed,
Criteria by which the team would evaluate proposals:

2. Related
Experience
C
o
s
t
S
c
h
e
d
u
l
e
Innovative
Design
30
points
30
points
15
points
25
points
ract
he
contract
would
be
a
fixed-price
contract.
On
May
155t
On
June
tne
30,
the
Omega
team
received
three
proposals:
15
the
team
announced
the
RFP
in
various
trade
publications
and
websites
and
required
oned
contractors
submit
a
proposal
no
later
than
June
30.
The
RFP
EP
did
not
state
how
much
funding
Omega
had
available
for
the
project.
S
Inc.
an
American
fim,
submitted
a
proposal
for
$150
million.
However,
they
stated
that
they
would
require
30
months
to
complete
the
project.
2
ROBETH
Construction
Company
of
Ireland
submitted
a
proposal
for
$175
million.
They
had
hruilt
several
other
facilities
for
Omega
in
the
past
and
felt
they
had
a
good
relationship
with
Ms.
TIno.
Jim
Stewart,
and
Olga
Frederick's
predecessor
who
recently
left
Omega
to
become
president
at
one
of
Omega's
competitors
that
is
also
considering
building
a
facility
in
China.
2Kangaroo
Architects
and
Engineers
of
Australia
submitted
a
proposal
for
$200
million.
Although
Kangaroo
had
never
done
a
project
for
Omega,
they
are
one
of
the
largest
contractors
in
the
world,
have
designed
and
built
many
and
various
types
of
facilities,
and
have
a
great
reputation
for
innovative
concepts,
such
as
"green"
environmentally
friendly
designs,
and
for
building
award-
winning
showcase
facilities.
They
had
built
facilities
for
several
of
Omega's
competitors.
The
team
was
disappointed
that
they
received
only
three
proposals;
they
had
expected
at
least
eight
On
luly
5,
a
fourth
proposal
was
received
from
Asia
General
Contractors,
a
company
based
in
China.
The
proposal
was
for
$160
million.
They
had
built
many
facilities
in
China
for
other
global
orporations
and
stated
that
they
have
good
knowledge
of
many
credible
trade
subcontractors
in
China
that
would
be
needed
to
build
the
facility.
They
also
stated
that
they
could
complete
the
project
in
20
months.
The
team
scheduled
a
meeting
for
July
15
to
discuss
the
proposals,
and,
as
a
team,
to
score
each
of
the
proposals
with
respect
to
the
evaluation
criteria.
That
provided
the
team
members
with
two
weeks
to
individually
read
the
proposals
and
develop
their
individual
comments
about
each
proposal,
but
they
agreed
not
to
individually
s
c
o
r
e
the
proposals
prior
to
the
July
15
meeting.
At
the
July
15
meeting,
Alysha
opened
the
meeting
and
stated,
"I
like
the
proposal
from
Kangaroo
because
it
would
provide
a
showcase
state-of-the-art
facility."
Jim
interrupted
her,
"Their
proposal
is
lor
more
than
the
Board
has
allocated
for
this
project,
I
don't
think
we
should
consider
them
any
further.
In
my
mind
they
are
out."
Alysha
responded,
"Even
though
it
would
require
some
additional
funding
than
the
Board
had
originally
approved,
I
feel
confident
thatI
can
perSuade
1.M.
and
the
Board
to
approve
the
additional
amount
required."
Jim
said,
"I
like
the
proposal
from
R
O
B
E
T
H
.
We
have
worked
with
ti
thirty
years
here
at
Omega,
and
their
nosal
from
ROBETH.
We
have
worked
with
them
in
the
past
during
my
proposal
cost
is
just
about
what
the
Board
has
allocated,
and
I
ow
a
lot
of
the
people
at
ROBETH.
Olga
mention
review
the
final
reports
of
the
previous
projects
that
RC
know
a
lot
of
the
pe
I
have
only
been
here
at
mega
for
less
than
a
year,
but
I
took
it
upon
myself
to
missed
their
p
r
o
p
o
s
e
d
s
c
h
e
d
u
l
e
s
met
all
the
p
e
r
f
o
r
m
a
n
c
e
s
p
e
c
i
f
i
c
a
t
i
o
.
Continuing
r
e
l
a
t
i
o
n
s
h
i
p
w
i
t
h
my
pred
ROBETH
did
for
Omega
and
found
that
ROBETH
projects
or
that
some
of
the
production
systems
never
ons."
She
continued,
"I
am
also
concerned
about
ROBETH's
predecessor
who
is
now
president
at
one
of
our
major
competitors
and
if
they
would
also
be
the
contractor
selected
by
our
competitor
to
build
ne
p
o
t
e
n
t
i
a
l
c
o
n
f
l
i
c
t
of
interest
if
they
he
plant
they
a
r
e
consi
design
for
o
u
r
c
o
m
p
e
t
i
t
o
r
'
s
facility.
I
think
it
wo
i
n
China.
They
might
use
some
of
our
proprietary
processes
in
their
s
i
d
e
r
i
ink
it
would
be
too
risky
to
use
them."

3. She continued, "I think the proposal from Asia General Contractors should be seriously considered
even though it arrived a few days after the required duedate.
Willie spoke up. "I strongly disagree. It would be unfair to the other three contractors."
Olga replied, "I think it is our job to select the contractor that will provide the best value and not he
Concerned about some silly rules about being a few days late; who cares? Besides they state that thev
can complete the project in 20 months, which means we will get the facility fully operational sooner
than with any of the other contractors. And that means more products out the door sooner, more
revenues and cash flow earlier, and should give us a better return on our investment,rightJim?"
After everyone's initial comments, Alysha stated, "Okay, 1guess we have to score these four proposals
against the evaluation criteria."
Jim interrupted, "You mean three proposals."
Olga spoke up loudly, "I think she said the four proposals, not three. Let's not get bogged down in
bureaucratic games, we have an important decision to make."
I.M. Uno is expecting the team to recommend a contractor to her byJuly 31 so she can review it and
present it to the Board of Directors at their August 15 meeting
Case Questions
1. Is there anything the team should have done when they received only three proposals byJune 30?
2. Should the team consider the proposal from Asia General Contractors? Why?
3. After sharing their individual comments at the start oftheJuly 15 meeting, how should the team
proceed with the rest of the meeting and any follow-up?
4. How could the selection process have been improved? Is there anything the Board, LM. Uno,
Alysha or the team could have done differently?