1. Kansas City Procurement Round Table
RFP Workshop
Kansas City
Procurement Round Table
Brian Lines, Ph.D
Assistant Professor
University of Kansas
Dept. of Civil, Environ. & Arch. Engineering

2. Agenda 8:00 – 8:30 Registration 8:30 – 9:00 Introduction
8:30 – 9:00
Introduction
The importance of the RFP process relative to project & company success
The importance of being fair, open, and transparent
The direct link between procurement and project outcomes
9:00 – 11:00
Project Scoping
How to “coach” business units on the importance of a Scope of Work
Templates for developing an effective scope of work
Interactive Workshop on Project Scoping
11:00 – 12:00
RFP/RFQ Development
Best practices for solicitation development and organization
Strategies for various industry sectors (IT and software, design and construction, long-term services, facilities and operations, etc.)
12:00 – 12:30
Lunch & Open Discussion
12:30 – 1:30
RFP/RFQ Development, continued
Report card for assessing RFP effectiveness
Interactive Workshop on RFP Development
1:30 – 3:30
Evaluation Procedures
Setting evaluation criteria and weighting schemes
Establishing an evaluation committee
Setting up evaluation scales and procedures

3. Scope Development Share the Project’s Constraints
Don’t be Overly Prescriptive
Focus on Current Conditions
Include an appropriate Vision Statement
Ask Vendors what they Need
Take-Away Tools
White Paper on “The Budget”
SOW Template
RFN Template

4. RFP Development Keep it Short – Proposal Page Limits
Focus on the People – look beyond the Logo
Keep it Open – Minimize “Pre-Selections”
Treat Price Fairly
Compete on Expertise – Risk & Value
Take-Away Tools
Sample Interview Questions
Price Proposal Template for IT
RFP Report Card

5. Evaluation Procedures
Blind Evaluations – Keep it Fair
Streamlined Scoring – Keep it Simple
Individual Evaluations – Avoid Groupthink
Offer Detailed Debriefings
Plan Before You Sign
Take-Away Tools
Evaluation Scale
Evaluation Scoresheets
Evaluation Matrix
Debriefing Template

6. Introduction

7. A Note on Terminology… Owner / Client / Buyer
The buyer, purchaser, receiver of services
Includes Procurement & Operations/PM
Internal user groups are the “Client’s Client”
Vendor / Contractor / Designer / Engineer / AEC / Proponent / Consultant / Software Provider
The “doers”… different terms for each industry sector
Scope of Work / SOW / Specifications / Statement of Work / Minimum Requirements / Minimum Qualifications / Technical Requirements
RFP / RFQ / Tender / Solicitation

8. Introductions…

9. IT Industry Performance
28% of projects are Successful
46% of projects are Unsuccessful
26% of projects Completely Failed or Cancelled
202% average Cost Overrun
111% average Schedule Overrun
The Standish Group, Chaos Reports – Collects case study information on IT failures. Studies 70,000+ projects in 15 years (Everleens and Verboef 2010)

12. Successful = essentially on-time, on-budget, with all features specified.
Challenged = complete & operational, but over-budget, over- schedule, and offers fewer features than specified.
Failed = cancelled at some point during development/implementation cycle or not used after implemented

13. IT Industry (Geneca, 2011)
In a study conducted with 593 business and IT professionals:
80% admit they spend at least half their time on rework, which is the result of unclear objectives, confusion of roles and responsibilities, and lack of stakeholder involvement.
75% of respondents believed that their IT projects are either always or usually “doomed” from the start
78% feel that team is ‘out-of-sync’ when it comes to project objectives
61% of the projects take longer than anticipated
57% of the projects are not considered a success
55% were confident that they objectives of their IT projects are clear
38% are confused about their team roles and responsibilities
31% believe there is a lack of common vision on project success criteria

14. IT Industry (Kappleman, McKeeman, Zhang, 2006) (Bloch, Blumberg, Laartz 2012)
Research conducted on 5,400+ IT projects:
Had a cost overrun of $66 billion
50% of all large IT projects ($15+ million), massively blow their budgets
Black Swans = Budget overrun of +200%
The average cost overrun is 45% over budget
The average delay rate is 7% over time
56% delivered less value than predicted / expected.
On projects over $15M:
Major causes for cost overruns are unclear objectives, lack of focus, and shifting scope

15. Early Warning Signs of IT Project Failure (Kappelman et al. 2006)
Identified 53 “early warning signs”
Grouped into 3 categories:
People Risks: behavioral
Process Risks: managerial
Product Risks: technological
Surveyed + Interviewed IT project managers
Average 15+ years of experience
Largest projects they managed were $3M to $7B
Project/program manager, IT consultants, analysts, VPs, executives.

16. The “Dominant Dozen” (Kappelman et al. 2006)
People-Related EWSs:
Lack of top management support.
No stakeholder involvement and/or participation.
Weak project manager
Weak commitment of project team.
Team members lack requisite knowledge and/or skills.
Subject matter experts are overscheduled.

17. The “Dominant Dozen” (Kappelman et al. 2006)
Process-Related EWSs:
Lack of documented requirements and/or success criteria.
No change control process (change management)No stakeholder involvement and/or participation.
Ineffective schedule planning and/or management Team members lack requisite knowledge and/or skills.
Communication breakdown among stakeholders.
Resources assigned to a higher priority project.
No business case for the project.

18. Fun Facts
Only 2.5% of projects defined as successful (scope, cost, schedule, & business)
PricewaterhouseCoopers, 2009
Only 30% of projects completed within 10% of the planned cost & schedule
Construction Industry Institute Performance Assessment Committee, edition
24% growth in owner’s construction indirect costs since 1995 (adjusted for inflation)

19. New Study: Charles Pankow Foundation and CII
Data shows no performance difference between delivery systems (DBB, DB,
Only key difference makers:
Qualifications-based selection of project team
Involvement of key people earlier in the project
Cost transparency throughout the project

20. Just because it’s written in the contract does not make it so

21. Who says they are the best for the job?
Vendor 1
Vendor 2
Vendor 3
Vendor 4
High Performer (Low Risk)
Who says they are the best for the job?
Low Performer (High Risk)

22. What We Have Seen… Vendor Vendor Promises RFP Client ($) Vendor Vendor

23. What We Have Seen…
RFP
($)
Client
Vendor

24. What We Have Seen…
RFP
($)
Client
Vendor
Client PM
Vendor PM ?

25. “The greatest risk I face is how to accomplish all of the things that our sales team promised we could do.”

27. Who brings the Client the most Risk?
Vendor 1
Vendor 2
Vendor 3
Vendor 4
High Performer (Low Risk)
Who brings the Client the most Risk?
Low Performer (High Risk)

28. Characteristics of a good Client?
Pays on Time
Fair
Transparent
Open
Values expertise
Does not micromanage
Listens
Wants their vendors to make a fair profit

29. Simplar Research Institute
Primary Research Objectives:
How do experts deliver projects?
How do experts deliver programs/portfolios?
Organizational development
Organizational change management

30. 2,500+ Projects | $11+ Billion Procured
20+ Years | 210+ Publications | 130+ Partners
2,500+ Projects | $11+ Billion Procured
Facility
Management
Information
Technology
Health Insurance/
Medical Services
maintenance
landscaping
security service
building systems
industrial moving
waste management
energy management
custodial
conveyance
pest control
Networking
Data centers
Hardware
COTS software
ERP systems
Help desk services
eProcurement
Manufacturing
Business/Municipal/ University Services
Construction/Design/ Engineering
Dining Services
Multi-media rights
Fitness equipment
Online education
Document management
Property management
Communications systems
Recycling
Bookstores
Laundry
Audio Visual
Retirement Funds
Infrastructure
Municipal
Laboratory
Education
Hospital
Financial
Specialty
Renovation
Repair
Maintenance
Roofing
Demolition
Development
Supply chain
DBB
CMAR DB
IDIQ
JOC
Low Bid
IPD

31. Strategic Partners & Efforts
7+ years
Infra/IT/Equip
€4B+
Canada 15 Owners
5 Provinces
Tongji University
United States 70+ Owners
37 States
Malaysia
Complete Supply Chain
Fulbright Scholarship-
University of Botswana
BV tests
RMIT
Teaching IMT
PBSRG platform

32. Other Current Partners

33. Simplar Research Institute
Minimize Cost by increasing Efficiency
Attract & contract with high performing teams
Leverage expertise into project operations
Get what you paid for and be able to prove it
Become a Client of Choice
Build a Region of Excellence
Facilitate Organizational Change and Development
Benchmarking, exploratory talent development
Hands-on Change Integration

34. Expertise-Driven Project Delivery (XPD)
PROCUREMENT & SELECTION
PRE-AWARD
CLARIFICATION
PERFORMANCE
METRICS
CONTRACT
AWARD
SCOPE
DEVELOPMENT