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Implement a Proactive and Consistent Vendor Selection Process
Formalize your process to eliminate bias and maximize value.
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Contributors
- Deepak Bansal, Director Vendor Performance Relationship Management, Willis Towers Watson
- Donald H. Hopkins, Adjunct Assistant Professor, Wright State University in the College of Business
- Daniel J. Enneking, Founder, Strategic Procurement Partners
- 2 anonymous contributors
Your Challenge
- Vendor selection is politically charged, requiring Procurement to navigate around stakeholder biases and existing relationships.
- The process is time consuming and often started too late. In the absence of clarity around requirements, it is easy to default to looking at price instead of best fit.
Our Advice
Critical Insight
- Rooting out bias is essential. Establishing a robust, ruthless, but reasonable process is vital to making unbiased vendor selections.
- Price comes last, requirements come first. Spend time up front to make sure that your key requirements are complete before proceeding with vendor selection.
- Differentiate business needs from wants. Comparing proposals against each other leads to confusion. Features matter – just not all of them. Matching solution capability to organizational needs matters more. Know your true minimum mandatory requirements vs. nice-to-have features, and compare proposals against your RFP instead of against each other.
- Price is not cost. Calculate TCO when considering internal and external cost.
Impact and Result
Start here – read the Executive Brief
Read our concise Executive Brief to find out why you should optimize your vendor selection process, review Info-Tech’s methodology, and understand the four ways we can support you in completing this project.
1. Establish and formalize process
Map your current vendor selection process, identify gaps, and then amend and document the process.
2. Gather requirements and write RFx
Begin a specific vendor selection by writing a project plan, then gathering and prioritizing requirements. Next, select, write, and publish your RFx.
3. Evaluate and select vendor
Select your evaluation method and framework, then perform due diligence and evaluate pricing. To finish, select and recommend a vendor.
Guided Implementations
This guided implementation is a nine call advisory process.
Guided Implementation #1 - Establish and formalize process
Call #1 - Map current process
Call #2 - Identify gaps in current process
Call #3 - Amend and document process
Guided Implementation #2 - Gather requirements and write RFx
Call #1 - Write a project plan
Call #2 - Discuss and prioritize gathered requirements
Call #3 - Review your RFx before publication
Guided Implementation #3 - Evaluate and select vendor
Call #1 - Select evaluation method and framework
Call #2 - Review due diligence activities
Call #3 - Review and validate vendor selection
Book Your Workshop
Onsite workshops offer an easy way to accelerate your project. If you are unable to do the project yourself, and a Guided Implementation isn't enough, we offer low-cost onsite delivery of our project workshops. We take you through every phase of your project and ensure that you have a roadmap in place to complete your project successfully.
Module 1: Establish Vendor Selection Process
The Purpose
- Document and refine your vendor selection process.
Key Benefits Achieved
- Formalized vendor
selection process.
Activities
Outputs
Map current process.
- Documented current vendor selection process
Identify gaps in current process.
- Gap analysis of current vendor selection process
Amend and document process.
- Formalized and amended process
Module 2: Gather Requirements
The Purpose
- Write a project plan and gather requirements.
Key Benefits Achieved
- Gathered and prioritized requirements.
- A clear project plan.
Activities
Outputs
Write a project plan.
- Proposal Evaluation Tool
Gather and prioritize requirements.
Write your scenario and use cases.
- Scenario Template
Module 3: Write and Assemble RFx Package
The Purpose
- Learn about
different RFx options and draft a successful RFx package.
Key Benefits Achieved
- Complete RFx package.
Activities
Outputs
Review different RFx options.
Draft RFx.
- RFx package
Make a plan for soliciting feedback and publishing the RFx.
Module 4: Perform Due Diligence
The Purpose
- Perform due diligence on candidate vendors.
Key Benefits Achieved
- Crucial information and data points
gathered about candidate vendors
- Due diligence completed.
Activities
Outputs
Customize a vendor reference script.
Reference Script Template
Review the due diligence checklist and key activities.
- Due Diligence Checklist
Module 5: Evaluate Candidate Solutions
The Purpose
- Evaluate your vendor proposals.
Key Benefits Achieved
- A selected vendor to recommend to
management with a formal presentation.
Activities
Outputs
Calculate TCO.
- TCO Calculator
Evaluator’s Guidebook
- RFP Vendor Response Template
Prepare final evaluation.
- Proposal Evaluation Tool or Pugh Matrix
Prepare presentation for management.
- Vendor Recommendation Presentation
After each Info-Tech experience, we ask our members to quantify the real time savings, monetary impact, and project improvements our research helped them achieve. See our top member experiences for this Blueprint, and what our clients have to say.
Client
$ Saved
Days Saved
Testimonial
Lorain County Community College
$64,743
N/A
The analyst completely understood what I was looking for and delivered a sane, to the point discussion on possible approaches. I have not had the time to review any documentation he may have sent.
St. Lawrence County
$6,474
30
No bad. David is a consummate professional and is walking me through what I need to do for this RFP. It would not get done if not for his involvement.
Interswitch Limited
$12,949
30
Best: Got price review.
Renown Health
$129K
2
Scott provided valuable insight into Kronos pricing and suggestions on how to approach them with our requests.
The Institute of Professional Practice Inc
$10,000
N/A
Best: Gaining insight into good business practices with contracts that I was not aware of.
Takasago International Corporation (U.S.A)
$81,291
7
This was a great experience to improve our IT procurement! Great benefit to my organization.
