At the end of a competitive bid process, our deliverable is a bid analysis report. We look at a number of factors, with the ultimate goal of making a vendor recommendation to our client.
We’re often putting our own reputation on the line when we do this, as our client expects us to be responsible for the outcome if they follow our recommendations. It’s not an unreasonable expectation, but it does keep us somewhat conservative in our recommendations. While we may take some chances with products from known manufacturers, often all of the bidders are unknowns to us, and we need to think carefully before going out on that limb.
Request for proposal
Most of the factors we look at are fairly good indicators of what we can expect. Throughout the bid process we note our interactions. Were they easy to work with? Did they ask a lot of questions that have absolutely no bearing on the RFP? Did they even read the RFP? You’d be surprised at how many questions we get that were already answered in the RFP.
Once the RFP response is received, we look at it to see if it is accurate and complete. Did they provide everything we asked for, including a compliance statement, references, and the appropriate documentation? We’ve seen firms respond to an RFP for a multimillion-dollar project with a few handwritten pages and no background information on their firms, their references, or their experience.
I’d be lying if I didn’t say that pricing wasn’t a huge factor. In fact, we start with the low bidder and see if it’s credible and, in our opinion, can get the job done. If not, we move on, but when we’ve found the lowest qualified and competent integrator on the pricing ladder, we can often stop there. In my experience, it is hard to pass over the low bidder, provided it is credible, without some pretty good reasons.
But there’s one factor we now look at with a new perspective: the size of the firm. Our thinking used to be that bigger was better; size meant stability, and a large firm was unlikely to fail, as it would have the resources to finish the job no matter what went wrong. While I’m not knocking the big firms, we’ve recently begun to evaluate this competitive aspect differently, and here’s why.
First, no matter how large the firm, it’s only as good as its branch office. Even if it brings its best and brightest to bear during the installation, the field office will be left supporting the project. So, you almost have to evaluate the local field office as an independent business to ensure that it will be able to carry its weight.
Second, and this is what changed our thinking, you need to look at finances in a different light. We used to think that bigger was better, but now we’re reconsidering for a simple reason: The smaller firms need the money more.
Anecdotally, we looked at all the projects we had done that seemed to drag on forever, and there was one thing in common: They were all large firms.
A small firm can’t afford to wait too long for its money. If things aren’t moving along, it’ll start asking questions and do what needs to be done to wrap things up. Our focus shouldn’t be so much on whether it can afford to finish the job, as a structured payment plan solves that problem — we just hold back enough money to hire someone else if needed.
We need to focus on knowing that the firm is sufficiently motivated to get the job done. And nothing motivates a small company quite like money — and the possibility of a good reference.
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