Best Practice Checklist for Choosing and Working with 3rd Party Vendors
Academic institutions work with many vendors. These vendors can provide software such as LMS, plagiarism, portfolio, dashboard, and
accessibility software, just to name a few. Vendors can provide services such as course development, instructional design, tutoring,
support to go with an LMS, and textbooks. And some vendors could be providing a combination of services and software. The contracts
can be fairly small with some vendors, a yearly contract of $500 or a multi-year contract of $100,000 or more. Depending on the type of
service provided, the size of the contract, and the RFP rules in your state or within your institution, questions may change. The goal of this
checklist is to provide an overview of everything that you should take into consideration. For some smaller vendors you may decide some
items are not applicable and, perhaps, for larger contracts you will add more details under some of the guidelines.
Completion
Action
Institutional
Checklist
Notes
Yes No N/A
Decision: Vendor or Internal? The time period when an institution is determining they have a need, but will they fill it internally or bring in a 3rd
party vendor. (Buy or Build)
1. What is the motivation to make a change? Possible reasons to change: it’s not working for your
students, faculty or the intended audience; your IT is making system wide changes and this product
won’t move over; better products are available (quality or quantity). If you don’t understand your
motivation for growth, you can’t properly assess product success.
2. Identify stakeholders: users, supporting roles, affected departments, other campuses, etc.
3. What criteria should be considered when investigating solutions? Possible criteria may include:
a) Technical: All tech criteria, including CMS needs, operating system, and communication speed
needs (does it only work with high speed internet). Can the current institutional technology support
the product?
b) Institution: What are your goals for the product? Who is the audience?
c) People: Who do you have on-campus? Do you need complete support, i.e. help desk, server, or will
you have people to cover this? Who will be implementing this and in charge of updates, training,
etc?
d) Vendor decision: Can a vendor provide any of the above more efficiently and effectively than you
can do so yourself?
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e) Open Source: Is open source an option?
a. Can the institution support open source?
b. Open source may be free, but may require more on-site personnel needs than a vendor. Is
IT ready to embrace the open source needs and potentially expand?
c. May need to internally compare vendor versus open source and talk to purchasing.
4. What is the desired return on investment? Will you need to track ROI? If so, do you personally have a
way to do so?
a) Retention & persistence gains, i.e. tuition gains greater than costs
b) Improved student grades, i.e. stronger student academics is worth the investment
c) Least cost alternative, i.e. the cost to build 24x7 tutoring is 4x when measured in actual tutoring
hours used
5. When deciding on a vendor it is important to take everything into consideration. For example, the
relationship with 3rd party vendors is considered a contractual arrangement if content is created and
delivered, faculty are provided, and some other issues.... This is a federal regulation that requires
notification if <25% of the curriculum is delivered and APPROVAL if 25-50% is delivered by the vendor.
Anything over 50% might not be eligible for Title IV. Make sure you have worked with your accrediting
agency and reviewed their guidelines if considering a vendor to provide content and/or do teaching.
6. Helpful Tools:
http://www.weighteddecision.com/
http://www.wcet.wiche.edu/wcet/docs/resources/GuideforPlanningCommLMS%20CIG110410.pdf
If Vendor: Accreditation, RFP Thoughts? The institution had determined they are moving forward to investigate third party vendors. Now what?
1. Accreditation Thoughts: Institutions may need regulatory approval for some relationships. For
example, the Higher Learning Commission provides the attached Substantive Change form that must be
submitted when an institution is ready to enter into an arrangement where academic activities may be a
shared arrangement, such as the LMS providing pre-built courses or recruiting faculty. (Please see the
HLC Substantive Change Form for Contractual Arrangements)
Please note: if an institutions is outsourcing complete programs this is not really a comprehensive enough
checklist. That institutions needs to think ahead about accreditation, how the vendor is representing the
school and more. They should definitely read the “Going the Distance” article referenced under sources by
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Susan E. Metros and Joan Falkenberg Getman.
2. Regulatory Considerations:
a. State Authorization
b. Misrepresentation (if the vendor is providing information to students)
c. FERPA for student privacy.
3. Considerations needs to be taken when scoping to help make decision of moving forward and when
drafting the RFP to assure correct language. What information needs to be gathered ahead of time and
what should wait until actual RFP process?
4. Procurement/Purchasing. Determine the contract rules and bidding laws in your state and within your
institution.
a) Prior to RFP one can often do a request for information (RFI), which can help you determine if you’ll
do an RFP and what it would look like. This can help determine what services you want or how to
negotiate for them.
a. This would add to process length
b. Check with Purchasing to assure this is possible.
b) Check with your Procurement/Purchasing department to determine at what cost you must bid out
for services (RFP process). Be careful of deadlines and the approval process. Your RFP document
can become an impediment to your needs.
c) Follow institutional process for RFP; be sure to include every service you would like to consider and
state that you will look at one to all the services (meaning they price each separately and then as a
bundle, if that is appropriate).
d) Clearly state in the RFP the institutional and state rules/laws on contract length and others that
would affect the contract for services.
e) Follow the boilerplates if available for RFPs and Vendors. Check State contracting prices as this may
apply.
f) Contract Considerations:
a. Consider a minimum period of time that the vendor must give notice if they are
discontinuing service.
b. Consider clause that allows for the requisite approvals to be acquired by accreditors or state
agencies.
c. Make sure you don't HAVE to take the lowest bidder unless it meets all your minimum
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criteria, which means you need really good minimum criteria.
d. Do you want to be listed as an institutional partner on the vendor's website?? There have
been a few recent situations where the institution has left the vendor but the vendor
continues to market the institution as a "partner."
e. Regarding state authorization, the institution (not the vendor) is responsible for seeking
approval in other states.
f. If this is a vendor that is helping to define students: Define recruitment expectations. If the
vendor identifies students, the institution should still maintain the responsibility of
determining whether students are eligible to be enrolled. How are vendors compensated for
recruiting students and for advising students as retention consultants?
3 Institutional Legal Office
a) Have the institutional legal office review the RFP for accuracy before releasing the RFP.
b) Allow TIME for attorney review. If your school attorney is on retainer, it may take extra time for a
review.
c) Have the legal office participate on the contract negotiation team and have the legal office sign off
that the terms of the contract are appropriate and meet the institutional/state rules and laws.
The Search: Finding the Right Vendor! The institution has determined they are moving forward to investigate third party vendors to meet this
need. Now what?
1. Gather invested parties into a focus group: This process is going to be different depending on the
institution. Depending on the type of technology, maybe only a VP and IT needs to be involved, in
others you’ll need a committee complete with members of faculty, student resources, IT, etc. Who
needs to be on your committee/focus group?
2. Make sure everyone understands the needs, goals, and the reasons you chose to not to perform this
task internally.
3. Create a rubric for the team to use when looking at the companies. The rubric should be based on your
needs and goals of the product. Another institution might use a product for a reason that is not
important to you. Or, another institution might dislike a product for a reason that again, is not
important to you.
4. Set a timeline for the search.
5. If needed, write and release the RFP based on the timeline.
If RFP is needed: An institution may have an RFP process for obtaining the product or service. Develop
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the RFP to meet not only the institutional needs for the product or service but include the information
required for meeting contract terms required by Procurement.
6. If an RFP is not needed: Determine and compare top companies. Talk to peers (such as the WCET
membership!) and get their recommendations.
7. Interview other clients of the vendors and even visit. Ask the people using it, not just the project
administrator.
8. Test the products, if possible.
Contract Time: Before decisions are made and contracts are signed, make sure you have a realistic picture of the contract terms and the
Implementation needs:
1. Map out the budget impact (short and long term).
2. Reconfirm all conversations you have in pre-buying and post-buying of a product. When you do
contract with a vendor do not feel “bad” about asking them to be accountable.
3. If your institution plans to develop an internal infrastructure for the product or service be sure to
consider contract length and the ability to phase out of the contract.
4. Have legal review, does evaluation group need to continue conversation with processing... keep all
applicable institutional groups in the conversation with procurement.
Implementation and Post Implementation: You’ve completed training. The technical component is working. Now what? Don’t forget about
the following important actions. Ideally the main campus contact for the implementation continues on as the main contact to work on
return on investment (ROI) and any ongoing issues.
1. Personnel Impact (short and long term): Have you set aside the resources to implement a solution
(including time, budget, and management)? Someone will have to work with the company to:
a) Schedule training, both initial and ongoing,
b) Assure that they are following all logo and communication procedures set by your institution,
c) Facilitate the work with IT, etc.
2. Institutional and Vendor Roles regarding Compliance with State and Federal Regs
a) Terms of the vendor contract should stipulate that the vendor is responsible being informed on all
state and federal laws and regulations pertaining to state authorization, student privacy, intellectual
property, accessibility, and others. The contract should stipulate that the vendor is liable for full
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compliance with all such laws and regulations. Make sure it is clear who’s responsible for what.
3. Marketing (Initial and Ongoing): How will you market the solution so students, faculty, staff are aware of
the availability and know how to benefit from it? Software, products, items are not used just because
they are purchased. Be aware of communication procedures for the audience with whom you are
working. You’ll need:
a) Ongoing marketing. Since people forget, you need to have regular communications. This could
include: through the company, within your ongoing faculty and/or student orientations, email
communications, etc.
b) Set expectations. Expectations of what everyone will gain from a service are the most important if
you want to lead to successful use.
c) Ongoing training. Once isn’t enough, training has to be ongoing. If you truly got a tool to support
students or solve a problem, then it only works if it’s always made clear to new and old students,
faculty, advisors, or whoever is the audience for that tool.
3. How will you integrate student support into existing campus technology solutions? Make sure these
options are clear ahead of time and approved by IT.
4. Measuring ROI: How you measure return on investment is going to change depending on the type of
product. These are some examples that might be applicable:
a) Cost Tutoring Example: A very small improvement in the percentage of students retained can pay
for the costs of a new product through tuition gains. Suppose you begin with 1,000 students and
10% of them (100 students) use tutoring. Studies show that an average of 10 to 15 more students
pass each term with tutoring, so the ROI average is 9 times the investment.
b) Student Improvement Examples:
i.
GPA
ii.
Grades
iii.
Persistence
5. Set up continuing communication regarding product and training with the company.
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Must Read Sources If Going Through This Process:
Metros, S. E. & Falkenberg Getman, J. (2012). Going the Distance: Outsourcing Online Education. Game Changers
HLC. (November, 2011). Substantive Change Application.
(November, 2012). Development of Vendor Partnerships to Support Online Programs.
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