Joann Martin, PMP, COPJanuary 25, 2010Selecting the Right Partnersto Optimize Outsourcing with aThorough RFP Process
22“A good alliance is like a unicorn. Everybody hadheard of them, but few have actually seen them.”Tom Hooks Motorola
Process1. Team2. Requirement – Business Case3. Landscape4. Selection Criteria – Evaluation Scorecard5. RF?6. Site Visit/Se...
Team Business Stakeholder(s) Finance Procurement Legal IT HR Project Manager Transition Managers Consultant
 All in Costs Rate (FTE/Transaction/Hour) Quality Data – Telecom/IP Project Manager One time costs Transition IT ...
 WWW Networking Books/Magazines Hoovers D&B Fidelity BBB Industry◦ BlackBook◦ IAOP◦ Forrester◦ GartnerLandscape P...
Performance CriteriaFinancialWhat does the vendors balance sheet look like compared to others?Its trends?What part of the ...
Key Decision Criteria WeightsArchitectural - Technology 15Operations 10SLAs - KPI 10Quality 10Implementation 10Risk Mitiga...
RF? Request for Information Request for Quote Request for Proposal Request for description/specification and pricing ...
 Instructions to Vendor◦ Administrative information◦ Dates/Media◦ Communications◦ Legal – Compliances – MSA Draft Overvi...
 Vendor Response Section◦ Solution Fit - Timing◦ Architecture/Technology◦ Team/HR/Talent◦ Process – Change Management/Pro...
. Short List Go to the location your work will be done Establish the objectives for due diligence visits◦ Review the vi...
. Short List Keep in 30 minutes or less Establish the objectives◦ Is the work the same? Location?◦ Why did they chose v...
Win - Win Short List Goal• Obtain Vendor’s Best Offer• Achieve your interests and goals• Obtain commitment from Decision...
 Fact Based• Information learned from process• Includes MSA exceptions• Historic Performance, Industry Trends - What Else...
Contract Starts with signed MOU Chance for attorneys to review Review MSA issues Structure MSA based globally SOW ba...
Transition• Built on communication and exchange to date• Official start of interface between you and your new partner• Off...
ExecutivesAccount OwnersProject LevelTransition to Manage – Stakeholder AlignmentThe Trust TriangleTimeRelationship Manage...
Manage - GOVERNANCE Establish accountability and alignment Verification of delivery of services within budget, time,and ...
Manage – Best PracticesGOVERNANCE - GOVERNANCE• Strategic responsibility at the top• Multilevel organizational links• Regu...
Manage – Define Success Which metrics are more relevant to your business Tangible objective Leading Indicators End Val...
Get past the dollar and cents, you are in this forthe long run
RFP Selection Process
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RFP Selection Process

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RFP Selection Process

  1. 1. Joann Martin, PMP, COPJanuary 25, 2010Selecting the Right Partnersto Optimize Outsourcing with aThorough RFP Process
  2. 2. 22“A good alliance is like a unicorn. Everybody hadheard of them, but few have actually seen them.”Tom Hooks Motorola
  3. 3. Process1. Team2. Requirement – Business Case3. Landscape4. Selection Criteria – Evaluation Scorecard5. RF?6. Site Visit/Security Audit7. Customer Interviews8. Negotiate9. Contract/MSA/SOW - Award10.Transition11.Manage
  4. 4. Team Business Stakeholder(s) Finance Procurement Legal IT HR Project Manager Transition Managers Consultant
  5. 5.  All in Costs Rate (FTE/Transaction/Hour) Quality Data – Telecom/IP Project Manager One time costs Transition IT Ongoing costs Travel Management Risk/Compliance Audit/ControlsWhy? Why? Why?
  6. 6.  WWW Networking Books/Magazines Hoovers D&B Fidelity BBB Industry◦ BlackBook◦ IAOP◦ Forrester◦ GartnerLandscape Public Private Size Finances Time in business Diversity – Minority Locations Done businessbefore Customers
  7. 7. Performance CriteriaFinancialWhat does the vendors balance sheet look like compared to others?Its trends?What part of the vendors portfolio will we beTechnologyHas technology investment been yearly?Where are they investing?Does it match our strategy?ProcessHow do they measure quality? Is it industry standard?Do they measure outcomes? Cycle time?Does the measurement match our goals?EmployeesWhat is their attrition? Hiring practices?Do they have good talent management plans?Is there an adequate labor pool available geographically?OrganizationIs there a global account rep?Are there global barriers?Do they have structural alignment with us?Selection Criteria
  8. 8. Key Decision Criteria WeightsArchitectural - Technology 15Operations 10SLAs - KPI 10Quality 10Implementation 10Risk Mitigation 10Pricing 30Value Add 5Overall 100Key Decision Criteria WeightsCosts 25Program Management/ ContinuousImprovement15Hiring/Training/Retention Practices 10Customer Retention 5Similar Experience 10Capability/ Technology 10Transition 15Personnel 10Overall 100Selection Criteria
  9. 9. RF? Request for Information Request for Quote Request for Proposal Request for description/specification and pricing Considers all terms of the potential contract Looking for the ‘best solution’ Involves an evaluation team More than the lowest price Further negotiations will happen as more specifications arediscussed
  10. 10.  Instructions to Vendor◦ Administrative information◦ Dates/Media◦ Communications◦ Legal – Compliances – MSA Draft Overview of Requirements◦ Details◦ Current Process◦ Technology/systems/tools◦ Risk – DR/BCP◦ Change◦ Strategy short term/mid term/long termOrganization of RFP“Personal Ad”
  11. 11.  Vendor Response Section◦ Solution Fit - Timing◦ Architecture/Technology◦ Team/HR/Talent◦ Process – Change Management/ProjectManagement/Relationship/Transition◦ Customer Satisfaction◦ DR/BCP◦ Value Add◦ Lessons Learned◦ Financials/Disputes◦ Certifications◦ References◦ Pricing and methodologyOrganization of RFPTRANSPARANCY AND FIT
  12. 12. . Short List Go to the location your work will be done Establish the objectives for due diligence visits◦ Review the visit process – Roles and accountabilities Collect and communicate questions Interview hands on team, supporting team(quality/site management) Observe other customer “areas” Security semi-audit Review tools - processes Document observations and responses during thevisit Reflect on comparisons quicklyDiscrepancies or Enforcerers
  13. 13. . Short List Keep in 30 minutes or less Establish the objectives◦ Is the work the same? Location?◦ Why did they chose vendor◦ What Worked, What didn’t◦ What would you do different◦ How long have they used vendor – grown or shrunk Collect and communicate questions Document observations and responses right afterthe call Offer the sameDiscrepancies or Enforcerers
  14. 14. Win - Win Short List Goal• Obtain Vendor’s Best Offer• Achieve your interests and goals• Obtain commitment from Decision-makers Team Negotiations• Greater ability to negotiate all issues, variety of technical expertise• Team Members, Presenter, Tie Breaker, Listener Complete a “Memo Of Understanding”• Organize negotiations session, Assign roles and responsibilities• Complete review of issues, Resolve
  15. 15.  Fact Based• Information learned from process• Includes MSA exceptions• Historic Performance, Industry Trends - What Else You Know,Previous Negotiations What are you negotiating◦ Services – Quality, SLA, Relationship/Reporting, DR/BCP◦ Costs - Cost Plus, Unit Pricing, Fixed Price, Transaction, Results◦ Risk – Strategic/Operational/Financial Term Flexible, Incentive Based, Gain-Sharing, Achievement Bonuses Discussion Order◦ Large Business Items – Less confrontational◦ Solution detail items◦ How much will it cost◦ Closure – value add, additional opportunityAll in prior to contract
  16. 16. Contract Starts with signed MOU Chance for attorneys to review Review MSA issues Structure MSA based globally SOW based on types of body of work Scorecards – changed monthly Change RequestsShould be just an exercise
  17. 17. Transition• Built on communication and exchange to date• Official start of interface between you and your new partner• Official agreement on volumes• Ramp plans• It build, Risk and DR/BCP• Forecast of volumes for ramp-up through production.• Communication plans• HR plans• Governance plan• Test, pilot, and conversion plansNot exactly a honeymoon
  18. 18. ExecutivesAccount OwnersProject LevelTransition to Manage – Stakeholder AlignmentThe Trust TriangleTimeRelationship Management
  19. 19. Manage - GOVERNANCE Establish accountability and alignment Verification of delivery of services within budget, time,and quality Manage ongoing expectations Collaborate to meet ever changing business needs Manage Change, Escalation, and RISK
  20. 20. Manage – Best PracticesGOVERNANCE - GOVERNANCE• Strategic responsibility at the top• Multilevel organizational links• Regular meetings at each level• Weekly ops• Monthly project• Quarterly business• Semi or annual strategic• Data driven - Scorecard used for results• Defined escalation process• Defined change management process
  21. 21. Manage – Define Success Which metrics are more relevant to your business Tangible objective Leading Indicators End Value or current activity Manage end to end Process Improvements Compete in the future Purpose of Metrics Recognize trends Motivate behaviors Prioritize resources Allow benchmarking Compensation Alignment Data Driven Communications
  22. 22. Get past the dollar and cents, you are in this forthe long run

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