So you're a Procurement Specialist and you need to put a Request for Tender, Request for Quotation or Request for Information (RFx) out to the market.
You need to comply with Procurement requirements
Your organisation will likely have its own policies and procedures relating to when, and how, to go out to the market for a RFx. This will include drafting an Evaluation Plan, dealing with Conflicts of Interest, ensuring Probity of the Procurement process, and how the RFx is evaluated (including preparation of the Evaluation Report and signing off on the decision by the Delegate).
Particularly with Governement Procurement obligations
And if you're a Government Organisation (including a government agency, a government department, a Council, etc), you will also have to comply various rules around Government Procurement. These may include the Commonwealth Procurement Rules (in Australia), Probity, and other formal policies, processes and procedures around Procurement, Tendering, use of public funds (PGPA Act in Australia), and so on.
Tips for running a successful Procurement
Here are some high-level tips for running a successful Procurement:
Tip 1 - Document your requirements properly
Before you go out to the market, consider and document your requirements for the Procurement.
If your requirements aren't clear or complete, you won't get what you actually need.
Tip 2 - Make sure you have a Lawyer on hand
You will likely need legal advice during the Procurement from your Legal Department or external Lawyers to help you draft the RFx documents (if you don't have templates), prepare the Draft Contract to go out with the RFx package, review Tenderer qualifications and departures, negotiate with the preferred Tenderer, and revise and finalise the Draft Contract.
Make sure your Lawyer is fully briefed on the Project in advance so they can advise on an ongoing basis, and give them plenty of time to respond to any of your requests for advice.
Tip 3 - Treat Tenderers fairly (not necessarily "equally")
Tenderers should be treated fairly, not necessarily equally.
Tenderers should all be given the same opportunities to respond to the RFx documents. For example, if you state in the RFx that an in-person site visit must be conducted, but there are travel bans due to COVID which means only the Tenderer with an office in your city is able to attend the site visit, by treating them equally (requiring an in-person site visit) you may not be treating them fairly (excluding most potential Tenderers).
Some commonsense is needed when drafting RFx documents and evaluating Tenders to ensure that Tenderers are treated fairly.
Tip 4 - Consider Clarification Questions asked by Tenderers
During the Tender Period, pay careful attention to questions asked by Tenderers.
These questions can give you a good idea whether a Tenderer doesn't understand the requirements - and can also highlight the Tenderers who are tuned into the deliverables that you actually want.
Clarification Questions can also give you a heads-up about any errors in the RFx documents.
Tip 5 - Price is not the only basis for Evaluation of Tenders
While evaluating Tenders, remember that price is not the only factor.
The most expensive Tender may be the best Tender for other reasons. This is often why the Risk Assessment, the Financial Assessment and the Value for Money Assessments are carried out separately.
Tip 6 - Risk Assessments are critical
Consider the risks of working with that Tenderer while you are doing your Risk Assessment. Consider things like how the Tenderer is structured, who is its parent company, whether it complies with government requirements (if applicable), whether it is financially sound, its insurance policies and so on.
Also consider how well you will be able to build a relationship with the Tenderer and its Key Personnel. Importantly, make sure you confirm with the Tenderer that the Key Personnel will be the people actually performing the Project. Some Tenderers put their Tender team forward as Key Personnel, then switch them out for their Projects Team once the Tender is awarded to them.
Tip 7 - Make sure you have an Evaluation Plan (and that you comply with it)
Always have an Evaluation Plan drafted before you go out to the market.
The Tender Schedules in the RFx should align with the Evaluation Criteria, which needs to be set out in the Evaluation Plan before the RFx is put out to the market.
The Evaluation Committee should then score Tenders based on the stated Evaluation Criteria.
Any weightings for the Evaluation Criteria should be pre-determined and stated in the Evaluation Plan (although not necessarily in the RFx unless this is required as part of the policy and procedures that the Government Organisation must comply with. Risk should not be weighted.
I've recently been involved in submitting a Tender where the government agency made a decision that was based on factors other than those stated in the Evaluation Criteria (and was directly contrary to the Essential Requirements). Not good practice, against Probity Requirements, and an action that could open that government agency up to an ANAO adverse finding. Make sure you don't do this!
Conclusion
There are many other tips that Procurement Officers and Procurement Specialists need to be aware of. Let me know if you want more.
And what's your best tip - write it in the comments below?
