RFP Planning and Evaluation for IT
Phil Pippert / Mike Novak
Supply Chain Management
March 18, 2010
www.vita.virginia.gov
1
Agenda
• VITA Supply Chain Management Overview
• IT Sourcing Challenges
• Technology Sourcing Process (TSP)
– Roles and Responsibilities
• SCM
• Evaluation team
• Steering/advisory team
–
–
–
–
Requirements Documentation
Evaluation Process
Timeline
Results
• Summary/Questions
www.vita.virginia.gov
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VITA’s Statutory Authority and Responsibility
§ 2.2-2012
A. Information technology and telecommunications goods and services of every
description shall be procured by (i) VITA for its own benefit or on behalf of other state
agencies and institutions or (ii) such other agencies or institutions to the extent authorized
by VITA. Such procurements shall be made in accordance with the Virginia Public
Procurement Act … and any regulations as may be prescribed by VITA.
B. All statewide contracts and agreements made and entered into by VITA for the purchase
of communications services, telecommunications facilities, and information technology goods
and services shall provide for the inclusion of counties, cities, and towns in such
contracts and agreements.
www.vita.virginia.gov
3
VITA Supply Chain Management
Category
Management
•Category contract
& sourcing plan
•SLA determination
•Strategy &
communication
Sourcing
•Sourcing process
•Negotiation strategy
•Contract negotiations
•Market analysis
•Pricing analysis
Contract
Mgmt.
•Develop custom
contracts
•Mitigate supplier risk
•Negotiate contract
modifications
•Monitor contract pricing
•Contract use review
•Cooperative contracts
Purchasing
Operations
•Contract administration
• Bids, small
procurements, quick
quotes
•Purchasing operations
•Order management
•P-card
•NG Partnership
transactions (P2P)
Supplier
Management
•Supplier relationship
management
•Monitor supplier
performance
•SLA tracking, reporting
& management
•Supplier relationship
methodology
Focus area
Policy Planning and Analysis
www.vita.virginia.gov
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IT Sourcing Challenges
• Complex products and services
• Subject to disruptive technology changes
• Industry consolidation and monopoly suppliers
• Intangible products that don’t work without fixes
• Rapid obsolescence
• Significant barriers to exit
• Part of business process; not just support
• Subject to complex restrictions on ownership & usage rights
• Supplier’s stockholders addicted to yearly increases in licensing
and maintenance revenue
www.vita.virginia.gov
5
Technology Sourcing Process (TSP)
• Follows Best Practice and the VPPA
• Led by sourcing professional
• Maximizes team advantage
• Dependent upon comprehensive requirements
• Documents roles, phases and deliverables
• Drives selection based on data
• Designed to involve all appropriate factors
Data Driven Decision Process = Data Based Selection
www.vita.virginia.gov
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SCM Technology Sourcing Process
REQUIREMENTS DEFINITION PHASE
NEGOTIATION PHASE
(Continued on page 2)
Start Funding
Process
Will
there be a
Steering
Committee?
Document
Functional
Requirements
Document
Technical
Requirements
SCM
SME
Identify
Business Need
Inform
CLIENT
Start
Conduct Client
Interview
Conduct
Market
Research
Conduct
Evaluation
Team Kick-off
Meeting
Facilitate
Requirements
Documentation
Check Funding
Develop
Timeline &
Evaluation
Criteria
Obtain
Steering
Committee
Approval
Complete RFP
Package
Issue
RFP Package
Serve as
SPOC
Conduct
Pre-proposal
conference?
N
Issue
Amendment
as appropriate
p2
Ensure eVA
Registration
p2
SUPPLIER
Y
Receive RFP
Submit
questions
Attend
Conference
CIO
Obtain CIO
approval
Process
Event
www.vita.virginia.gov
Decision
Terminator
Direction of Flow
Team Work
SCM Strategic Sourcing
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SCM Technology Sourcing Process (cont’d)
SCM Technology Sourcing Process
NEGOTIATION PHASE
EXECUTION PHASE
Cancel RFP Project Procedure*
(Continued from page 1)
CLIENT
N
Begin
Implementation
Y
SME
Funding
approved?
SCM
Sign & Award
Contract
Receive &
Distribute
Proposals
Facilitate
Evaluation of
Proposals
Identify
Short List
Conduct
In-depth
Discovery
Review
Short List
Perform Cost
Analysis
Identify Top
Contenders
Update
Steering
Committee
Conduct
Contract
Negotiations
Select
winner(s)
Enable
Provisioning
via eVA
Update
Contract
Database
Obtain
Authorized
Signature
Submit
Proposals
Sign
Contract
CIO
SUPPLIER
End
*SCM Policy Manual
Process
Event
www.vita.virginia.gov
Decision
Terminator
Direction of Flow
Team Work
SCM
SCMStrategic
StrategicSourcing
Sourcing
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SCM Role in Sourcing Project
• Sourcing Process Leadership
–
–
–
–
Assist in organizing evaluation team
Scheduling and lead team meetings
Evaluate for their area of expertise
Serve as SPOC
• Best Practice Process and Templates
– Industry tested RFP, evaluation and Contract templates
• Market Expertise
– Conducts market research specific to project needs
• VPPA Knowledge
– Ensures VPPA is followed and procurement file is preserved and made
available
www.vita.virginia.gov
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Evaluation Team Role
• Provide Subject Matter Expertise
–
–
–
–
Document requirements by area of expertise
Determine evaluation criteria and weight
Assist SPOC in responding to supplier questions
Evaluate and score proposals for their area of expertise
• Be available for the project
– At least 4 meetings – kickoff, review RFP and establish evaluation
criteria, initial consensus scoring, final consensus scoring
– Attend presentation/site visits as needed
• Commitment to the initiative
– Desire for the project to be successful – willingness to support
– Broad perspective – best value for the Commonwealth
• Diligently maintain confidentiality
– Capture and save all records created
– Direct suppliers/questions to SPOC
www.vita.virginia.gov
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Customer/Steering Team Role
• Provide overall project strategy and governance
• Provide appropriate evaluation team members
• Confirm scope of the project
• Determine what success would look like
• Obtain funding
• Maintain confidentiality
www.vita.virginia.gov
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Initiative-wide Reminders
• Capture and save all records created
• Diligently maintain confidentiality
• Resource availability has direct impact on project
timeline
• Direct suppliers/questions to SPOC
www.vita.virginia.gov
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Procurement File
• All records must be preserved
• Save all documents (including emails) in project folder
• Capture individual notes in one place (eval worksheet) –
not relevant to final score based on consensus
• Burn files to CD – send to SCM
• SCM will capture other relevant records – RFP,
consensus score sheets, summaries, etc.
File will be made available as required by the VPPA –
but all documents and correspondence are subject to FOIA
www.vita.virginia.gov
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Comprehensive Requirements
User
perspective
Best Value
to Cost
Ratio
www.vita.virginia.gov
Environment
and Support
Functional
Technical
Financial
Business
Relationship
Contract
and SLAs
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Evaluation Template
MUSTS
(Indicate Yes or No for each of the MUSTs listed
SAMPLE DATA
Item
Nbr
1
Supplier A
Supplier B
Supplier C
Supplier D
Supplier E
Description
Meet all Manditory requirments
YES/NO
YES/NO
YES/NO
YES/NO
YES/NO
2
Is financially vialble
YES/NO
YES/NO
YES/NO
YES/NO
YES/NO
3
Not less than 3 excellent customer references
YES/NO
YES/NO
YES/NO
YES/NO
YES/NO
WANTS
Item
Weighted
Nbr
Description
Weight
Security
5
2
Migration plan
3
1
Score
Score
Weighted
Score
Score
Weighted
Score
Score
Weighted
Score
Score
Weighted
Score
Score
0
0
0
0
0
6
0
0
0
0
0
Support
7
0
0
0
0
0
Ease of upgrades
6
0
0
0
0
0
5
Willing to work with standard form contract
5
0
0
0
0
0
6
Frequency of updates
6
0
0
0
0
0
8
Interoperability
5
0
0
0
0
0
5
0
0
0
0
0
4
9
Strategic Direction
10
Interface
3
0
0
0
0
0
11
Impact to desktop performance
8
0
0
0
0
0
11
0
0
0
0
0
12
0
0
0
0
0
www.vita.virginia.gov
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Generic Sourcing Project Timeline
Start
Month 1
Month 2
Month 3
Month 4
Month 5
Month 6
Month 7
Define need and scope
Document requirements, evaluation criteria
Draft RFP
RFP review and approval
Issue RFP
Pre proposal conference; proposal development
Proposals due
Proposal evaluation, short list, demos, etc.
Develop contract
Negotiation & Award
Assumptions:
•Project is of average complexity – timelines will vary by project
•Initiation of efforts dependent upon completion of other efforts – eg. RFP cannot be drafted without requirements
•Suppliers have about 4 weeks to develop proposals; 6 weeks to read and evaluate, attend presentations, site
visits, etc. and 4 weeks to negotiate a final contract
www.vita.virginia.gov
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Desired Results
• Clear easy to use agreements that document the business
relationship (4 corners contract)
• Meaningful Service Levels that tie to business performance
• Strong warranties with business remedies
• Significant attention to Intellectual property rights
• Contract commitments tied to solution not product
www.vita.virginia.gov
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Summary
•
IT Sourcing is challenging
•
Structured sourcing process (roles, phases & deliverables)
•
Comprehensive requirements – Functional, Business, Technical and
Financial
•
Solutions-based solicitations
•
Team based evaluation, using subject matter experts
•
Contract is evaluated as part of decision process
•
Market research to evaluate market risk and sourcing strategy
•
Data driven process to coalesce many different needs and perspectives
•
Collaborative decision process
•
Feedback from customers to improve
www.vita.virginia.gov
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