Feasibility And Rfp Design Final

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Municipal Broadband Network Feasibility Tips

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  • Feasibility And Rfp Design Final

    1. 1. RFPs and Feasibility Studies Drivers of Critical Decision Making
    2. 2. Decision Making Process Final choices Design and Build, Set up: Operations Marketing Customer Service Implementation Phase 3 Development of the business plan Yes or no decision Fact gathering and analysis, problem solving, integration of components. Feasibility Phase 2 Narrowed choices on technology, operating structure, open access, etc. Holistic strategies Education Develop political will and vision Pre-Feasibility Phase 1 Decisions Purpose Name Phase
    3. 3. Purpose Design Implementation Eric Lampland Lookout Point Communications [email_address] 651.227.8122 Feasibility Studies
    4. 4. Feasibility - is it doable? <ul><li>Educational Stage </li></ul><ul><ul><ul><li>Develop political will around a few paths </li></ul></ul></ul><ul><li>Feasibility Stage </li></ul><ul><li>Determine which choices are doable </li></ul><ul><li>Design and Implementation Stage </li></ul><ul><li>Do it - execute well </li></ul>
    5. 5. educational phase … <ul><li>You have developed a fair idea of why this is good to do. </li></ul><ul><li>You know something about the environment - who, what and how. </li></ul><ul><li>Terminology isn’t so frightening and you can spell most T/FLAs. </li></ul><ul><li>Key people understand the motivations and are supportive. </li></ul><ul><li>Set up expectations, review key goals, know your objectives -- </li></ul>Document all of the above
    6. 6. Preparing for feasibility … <ul><li>Document for distribution with the (helper) RFP all -- </li></ul><ul><ul><li>Descriptions of your community (population, growth, </li></ul></ul><ul><ul><li>number of houses, apartments, SMBs, campuses) </li></ul></ul><ul><ul><li>Motivations and desired outcomes </li></ul></ul><ul><ul><li>What services you are considering </li></ul></ul><ul><ul><li>Any maps of the community (penetration of other providers, know fiber, zoning, etc.) </li></ul></ul><ul><li>Develop an understanding of the work to be done. </li></ul><ul><ul><li>Construct the scope of work </li></ul></ul><ul><ul><li>Prioritize according to your goals and objectives </li></ul></ul><ul><ul><li>Know what you don’t know (very hard) - do your best </li></ul></ul><ul><li>Develop an oversight plan </li></ul>
    7. 7. Purpose … To determine feasibility - doable <ul><li>Can it be physically built and at what precise price </li></ul><ul><ul><li>Physical Media, Electronics (Municipal Commons) </li></ul></ul><ul><ul><li>Services -- what, how delivered, partners (Closed or Open) </li></ul></ul><ul><ul><li>Operational methods and expense </li></ul></ul><ul><ul><li>Initial Capital, equipment/service replacements, upgrades </li></ul></ul><ul><li>Can it be paid for and how </li></ul><ul><ul><li>Marketing Plan -- how and at what expense </li></ul></ul><ul><ul><li>Methods for financing, sources of revenue </li></ul></ul><ul><ul><li>Initial tentative agreements </li></ul></ul><ul><li>Confidence: that you are within 10% to 15% of actual </li></ul>
    8. 8. When you finish … <ul><li>Full Business Plan </li></ul><ul><ul><li>Listing of Types and Methods for Services </li></ul></ul><ul><ul><li>Recommended Marketing Plan </li></ul></ul><ul><ul><li>Recommended Architecture </li></ul></ul><ul><ul><li>Recommended Operational Plan </li></ul></ul><ul><ul><li>Doable Financial Model and Governance </li></ul></ul><ul><ul><li>Implementation timing and horizon </li></ul></ul><ul><li>Identification of Partnerships, Builders, Content … </li></ul><ul><li>Recommended Financing Model </li></ul>
    9. 9. Scope of Services: Markets - Services <ul><li>Establish your Competitive Posture </li></ul><ul><ul><li>Current Provider(s) offerings/negatives, price levels, </li></ul></ul><ul><ul><li>Bundles/packages, plans </li></ul></ul><ul><ul><li>How are you different? Why are you better? Can you </li></ul></ul><ul><ul><li>maintain this over time? </li></ul></ul><ul><li>Establish Pricing Strategy and Approach </li></ul><ul><ul><li>What are you offering, what’s special, enticements and </li></ul></ul><ul><ul><li>discounts, growth in services, new functions … </li></ul></ul><ul><ul><li>Iterate with cost of providing: video content, Internet </li></ul></ul><ul><ul><li>bandwidth, interconnection charges </li></ul></ul><ul><li>Develop Quantitative Market Research </li></ul><ul><ul><li>Test your assumptions -- Focus groups, small sample </li></ul></ul><ul><ul><li>statistics, phone surveys, existing provider </li></ul></ul><ul><ul><li>penetration, door-to-door, et al </li></ul></ul>
    10. 10. Scope of Services -- Operations <ul><li>Services infrastructure and support </li></ul><ul><ul><li>RF for video, IPTV, VoD, Mobility, Telephone Services </li></ul></ul><ul><ul><li>Bandwidth on demand, authentication and security … </li></ul></ul><ul><ul><li>Partnerships -- content, peering, interconnect </li></ul></ul><ul><li>Operational methods mechanisms </li></ul><ul><ul><li>Who handles support and how, closed/open/hybrid capabilities, </li></ul></ul><ul><ul><li>inventory management, billing, provisioning, network management </li></ul></ul><ul><ul><li>How do you manage partnerships (services, support, vendors) </li></ul></ul><ul><li>Implementation Methods </li></ul><ul><ul><li>Initial roll out plans and modifications </li></ul></ul><ul><ul><li>Change management, service & system equipment refreshes </li></ul></ul>
    11. 11. Scope of Services - Architecture <ul><li>Define access architecture(s) -- fixed and increments </li></ul><ul><ul><li>FTTH for Residences, SMB (WiMax for northern reach) </li></ul></ul><ul><ul><li>WDM, GigE, MetroE, packet optical for larger commercial </li></ul></ul><ul><ul><li>enterprises, growth projection </li></ul></ul><ul><li>In Network Services </li></ul><ul><ul><li>caching, peer-to-peer, authentication, security, mobility, reliability, gaming, impulse buying … </li></ul></ul><ul><li>Transport Structures and Aggregation </li></ul><ul><li>Quality of Service mechanisms </li></ul><ul><ul><li>Method(s) of traffic separation, segmentation </li></ul></ul><ul><ul><li>Service Level Agreements (mostly businesses ) </li></ul></ul><ul><ul><li>Reliability methods and attributes </li></ul></ul><ul><li>Home environment support </li></ul>
    12. 12. Scope of Services -- Financial Plan <ul><li>Roll up costs to build (Architecture and Services) </li></ul><ul><ul><li>Increments based on Marketing and Implementation </li></ul></ul><ul><li>Roll up costs to operate - fixed and variable/annual </li></ul><ul><ul><li>Software, people, equipment, electricity, peering costs, etc. </li></ul></ul><ul><li>Estimate market entry costs -- </li></ul><ul><ul><li>legal, initial marketing, delays, etc. </li></ul></ul><ul><li>Estimate revenues -- vary them by </li></ul><ul><ul><li>penetration rates, pricing strategy, service mix </li></ul></ul><ul><ul><li>find break even points, cash positives </li></ul></ul><ul><li>Determine value add for community in dollars </li></ul><ul><ul><li>Increased taxes (new business, new residents, property tax) </li></ul></ul><ul><ul><li>Governments services -- offsets to existing, new capabilities </li></ul></ul><ul><ul><li>Quality of Life benefits -- home health care, education, etc . </li></ul></ul>
    13. 13. Scope of Services -- Governance <ul><li>Does the financial analysis suggest an approach? </li></ul><ul><li>What are legal or regulatory issues and do they have impact? </li></ul><ul><li>Have you thought through local control issues, PEG support, </li></ul><ul><ul><li>franchise revenues, customer support, permits and codes? </li></ul></ul><ul><ul><li>(not only financial -- you don’t want to become “them”) </li></ul></ul><ul><li>What options exist to protect against downside risk? </li></ul><ul><li>What is the impact on viability from various approaches? </li></ul>
    14. 14. Implement: RFP - write one <ul><li>Starting with a good sense of what you know, be specific. </li></ul><ul><ul><li>Create a Scope of Services categories might be: </li></ul></ul><ul><ul><li>Marketing - Services, Operations, Architecture, Finance, </li></ul></ul><ul><ul><li>Governance </li></ul></ul><ul><li>Specify experience desired </li></ul><ul><ul><li>look for neutral companies if possible </li></ul></ul><ul><ul><li>must include building/running networks, finance, marketing </li></ul></ul><ul><li>Prioritize evaluation criteria </li></ul><ul><ul><li>what is most important to your community </li></ul></ul><ul><ul><li>create an evaluation guide (decision matrix). </li></ul></ul><ul><li>Prepare all documentation you can find that helps </li></ul><ul><li>Ask for a willingness to explore options -- </li></ul><ul><ul><li>ask if feasibility people can manage next stage </li></ul></ul><ul><ul><li>ask for their vision on “things that make you special” </li></ul></ul>
    15. 15. Implement: Oversight <ul><li>Develop an Oversight Plan </li></ul><ul><ul><li>ensure ongoing education </li></ul></ul><ul><ul><li>ensure meeting community values and goals </li></ul></ul><ul><ul><li>ensure responsibility stays where it belongs </li></ul></ul><ul><li>It is a process, not just a list of tasks - be iterative </li></ul><ul><li>Stop if you can tell that it is not doable </li></ul><ul><li>Don’t let unsupported statements stand long </li></ul><ul><li>Keep key persons and supportive community involved </li></ul>
    16. 16. Implement and Win Know where you are . . . Do your homework, document, details count, find balance Get real help … helpful and knowledgeable guide(s) Ask all the burning questions . . . And get answers if you can Have some fun, but remember you are creating a public good and when you Win, it will feel VERY GOOD indeed!
    17. 17. U-reka Broadband Ventures RFP Creation “Preparing a document that gets you the information you need without burning your eyes out”
    18. 18. Why do we know anything? <ul><li>Have created and responded to Requests in the Telecommunications Industry including: </li></ul><ul><ul><li>Infrastructure </li></ul></ul><ul><ul><li>Equipment </li></ul></ul><ul><ul><li>Telecom Services </li></ul></ul><ul><ul><li>Consulting Services </li></ul></ul><ul><ul><li>Operational Support Systems </li></ul></ul>
    19. 19. Asking the Right Questions <ul><li>Ask open questions that require respondents to provide more than a yes or no response </li></ul><ul><li>Provide a space for response that keeps questions in an order that makes it easier to analyze </li></ul><ul><li>Place your questions in an order that mimics your decision matrix </li></ul>
    20. 20. RFI, RFP,RFQ <ul><li>RFI -Request for Information-document that requires respondents to provide information on their product, service or solution and typically provide budgetary pricing </li></ul><ul><li>RFP -Request for Proposal-typically used for service type requests; consulting, engineering, project management and the like. Firm numbers and commitments made by respondents </li></ul><ul><li>RFQ -Request for Quotation-typically used for equipment, hard-assets and services to furnish and install </li></ul>
    21. 21. Examples of Open Ended Response: Please describe other projects where your company has provided financial analysis of competing telecommunications providers; describe the process you utilized to create pro-forma’s and gather financial information?
    22. 22. How about Close-ended questions? <ul><li>Definition: Question is specific and must be answered with a yes or no, or with details as appropriate. </li></ul><ul><li>Good to utilize when asking basic questions such as: </li></ul><ul><ul><li>Insurance Requirements </li></ul></ul><ul><ul><li>Licensing Requirements </li></ul></ul><ul><ul><li>Other “check-off” types of requirements </li></ul></ul>
    23. 23. Decision Matrix <ul><li>Determine your Desired Outcome </li></ul><ul><li>Understand the components to get there </li></ul><ul><li>Rate which are most important to least important and provide a weighting to each </li></ul><ul><li>Utilize this matrix to then craft questions for the RFP that will allow you to analyze the respondents </li></ul><ul><li>Make decision on how percentages will be assigned </li></ul>
    24. 24. Example Matrix Total Rating 5 Rating 4 Rating 3 10% Insurance Requirements 80% Price 25% Pricing 20% Services 25% Process 25% Timeline 50% Description of Process 25% Previous Experience 15% Regulatory/Legal 15% Sales/Marketing 20% Financial 15% Operations 15% Network 10% Licensing Requirements 50% Expertise Rating 2 Rating 1 % Weighting Category/Sub Category
    25. 25. Go to Haves! <ul><li>Description of Project </li></ul><ul><ul><li>Community Information </li></ul></ul><ul><ul><li>Previous work completed </li></ul></ul><ul><li>Expected Outcomes/Requirements </li></ul><ul><li>Three Broad Categories to cover in an RFP: </li></ul><ul><ul><li>Expertise of Vendor </li></ul></ul><ul><ul><li>Process Vendor will use to complete project </li></ul></ul><ul><ul><li>Pricing and Legal </li></ul></ul><ul><li>Evaluation Criteria and Rating </li></ul>
    26. 26. Expertise <ul><li>Network-what knowledge and experience does the vendor have regarding fiber-to-the-premise networks </li></ul><ul><li>Operations-operational knowledge and experience operating fiber-to-the-premise networks </li></ul><ul><li>Financial-ability of vendor to create Performa's and analyze financials regarding capital, operations and financing options </li></ul><ul><li>Sales/Marketing-ability of vendor to create and analyze sales and marketing objectives </li></ul><ul><li>Regulatory/Legal-ability of vendor to analyze and interpret the Regulatory and Legal landscape and provide guidance on the Regulatory hurdles of differing solutions </li></ul><ul><li>Services-ability of vendor to provide guidance surrounding services to be provided over the network including voice, data, video and other ancillary services </li></ul>
    27. 27. Process <ul><li>Timeline </li></ul><ul><ul><li>How long will it take the vendor to complete the project </li></ul></ul><ul><ul><li>Asking for a project chart to represent this is always a good idea </li></ul></ul><ul><li>Description of Process </li></ul><ul><ul><li>How will the vendor gather information, work with you, compile the information and provide a final product </li></ul></ul><ul><ul><li>Another important piece is what expectations the vendor has regarding your involvement in the process </li></ul></ul><ul><ul><li>What you are looking for here is good project management practices and thoroughness of the process </li></ul></ul><ul><li>Previous Experience </li></ul><ul><ul><li>References of Previous Projects </li></ul></ul><ul><ul><li>Other telecommunications background and projects </li></ul></ul>
    28. 28. Pricing <ul><li>Scope as Understood by Vendor </li></ul><ul><li>Pricing for the project </li></ul><ul><ul><li>Not to exceed? </li></ul></ul><ul><ul><li>Change orders? </li></ul></ul><ul><ul><li>Other Hourly services? </li></ul></ul><ul><li>Insurance coverage </li></ul><ul><li>Other financial qualifications-want to make sure they will be around </li></ul>
    29. 29. Analysis <ul><li>Utilize the team you have put together for creating the decision matrix </li></ul><ul><li>Each member should do an independent evaluation utilizing the decision matrix and provide ratings </li></ul><ul><li>Combine these ratings to determine the ranking of your vendors </li></ul>
    30. 30. Vendor Matrix Tally Sheet 50 50 32 32 34 35 24 27 22 27 29 30 Total 10 10 8 4 5 5 5 5 4 3 6 4 1-10 Rating 5 10 10 5 8 8 9 4 9 2 6 5 5 1-10 Rating 4 10 10 7 6 6 7 5 2 6 6 3 7 1-10 Rating 3 10 10 10% Insurance Requirements 6 6 80% Price 25% Pricing 4 6 20% Services 25% Process 6 8 25% Timeline 7 8 50% Description of Process 6 8 25% Previous Experience 6 5 15% Regulatory/Legal 6 4 15% Sales/Marketing 7 5 20% Financial 8 7 15% Operations 8 6 15% Network 10 10 10% Licensing Requirements 1-10 1-10 50% Expertise Rating 2 Rating 1 % Weighting Category/Sub Category
    31. 31. Vendor Matrix Totals 50 50 35 45 40 50 10%   Licensing Requirements 50 50 35 45 40 50 10%   Insurance Requirements 35 32 28 30 35 32 80%   Price             25% Pricing 32 31 16 22 26 32 25%   Previous Experience 34 34 16 26 25 34 50%   Description of Process 35 32 18 26 28 35 25%   Timeline             25% Process 25 25 13 17 19 24 20%   Services 27 26 12 19 22 27 15%   Regulatory/Legal 25 25 14 21 24 22 15%   Sales/Marketing 29 29 17 19 20 27 20%   Financial 29 28 18 23 26 29 15%   Operations 35 35 16 26 22 30 15%   Network             50% Expertise Vendor 5 Vendor 4 Vendor 3 Vendor 2 Vendor 1 % Weighting Category/Sub Category
    32. 32. Vendor Matrix Rankings 97.0% 58.4% 76.6% 82.5% 95.2%   100% TOTAL 10% 7% 9% 8% 10% 10%   Licensing Requirements 10% 7% 9% 8% 10% 10%   Insurance Requirements 73% 64% 69% 80% 73% 80%   Price 23% 20% 22% 24% 23%   25% Pricing 24% 13% 17% 20% 25% 25%   Previous Experience 50% 24% 38% 37% 50% 50%   Description of Process 23% 13% 19% 20% 25% 25%   Timeline 24% 12% 18% 19% 25%   25% Process 20% 10% 14% 15% 19% 20%   Services 14% 7% 11% 12% 15% 15%   Regulatory/Legal 15% 8% 13% 14% 13% 15%   Sales/Marketing 20% 12% 13% 14% 19% 20%   Financial 14% 9% 12% 13% 15% 15%   Operations 15% 7% 11% 9% 13% 15%   Network 49% 27% 36% 39% 47%   50% Expertise Vendor 5 Vendor 4 Vendor 3 Vendor 2 Vendor 1 % Weighting Category/Sub Category
    33. 33. Contact Information www.blandinonbroadband.org <ul><li>Eric Lampland </li></ul><ul><ul><li>Lookout Point Communications </li></ul></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>651.227.8122 </li></ul></ul><ul><li>John Schultz </li></ul><ul><ul><li>U-REKA Broadband </li></ul></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>651 967-7196 </li></ul></ul><ul><li>Bill Coleman (all Blandin Broadband Inquiries) </li></ul><ul><ul><li>Community Technology Advisors </li></ul></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>651-491-2551 </li></ul></ul>

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