How Procurement Section Weightings Can Make a World of Difference by Tyler Fosnaugh

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How Procurement Section Weightings Can Make a World of Difference by Tyler Fosnaugh

A successful procurement can drive the future of your organization. The larger the procurement, the more of an impact it can have on your organization. In some instances, you may be choosing with whom you will partner with for years to come and to whom you may pay millions of dollars to. For these reasons, the procurement process can be quite a terrifying thing to undergo.

Although a public-sector organization may have less control over the process than a private company, the process is largely the same when it comes to big, complex projects. We must remain impartial in order to choose the best solution for our organization.

But not all our stakeholders who participate in the procurement process are familiar with the process and the best ways to conduct a procurement. Many people only touch procurements once every few years and may not think about the process aside from when they are reading through hundreds of pages of proposals.

This can be detrimental to future procurements.

This is where netlogx comes in. Having conducted a variety of procurements for a variety of different organizations, we have the experience and understanding to bring lessons learned and best practices from other procurements to your organization.

One of the biggest issues we see is when organizations miss the opportunity to fully direct the procurement and control what type of solution they are purchasing. Throughout the solicitation documents (i.e. RFP, RFS) we inform the vendors of our organization’s needs through the requirements, background information, and statement of work. Then we typically evaluate their responses to these sections using impartial and unbiased evaluation criteria.

But when companies consider the evaluation weightings, they often fall short of their full potential. Many organizations simply consider the ration of cost points to the remaining points (i.e. business proposal, technical narrative). But our experience has demonstrated to us that this can be taken another step further.

We recommend breaking the technical and business sections into smaller, more digestible pieces by which you can evaluate each proposal. This allows you to place greater emphasis on sections which are more pertinent to the success of the project. For instance, allocating more points to the Project Management section if you’re setting up a Project Management Office, or more to the Technical Solution Capabilities if you’re buying a new Customer Relationship Management solution.

As demonstrated in the following example, we can see how different weightings affect the outcome of the procurement. In this example, the weightings of each section have changed but the points scored by each vendor in each section only change proportional to the number of points available in each section. This shows how changing the weightings can have a significant overall outcome on the procurement process.

Tyler 1

Tyler 2

In the first scenario, we have decided to allocate half of our Technical/Business points to Project Management, while in the second scenario, the section weights are more evenly dispersed, although Technical Solution Capabilities is now the most important section.

By simply changing the way we’ve allocated the available points, the entire outcome of the procurement has changed entirely.

So how do we ensure that we’ve allocated the points in a most advantageous manner? At netlogx we conduct an interactive weighting determination exercise with the key stakeholders. This exercise provides full visibility into a number of different scenarios to allow us to stack the proposal sections in such a way that they right vendor will be chosen for the given opportunity.

For more information about how netlogx can help you drive your procurement process, send us a message at information@netlogx.com.

By | 2018-06-29T11:21:33+00:00 June 29th, 2018|Categories: netlogx Noodles, Uncategorized|Comments Off on How Procurement Section Weightings Can Make a World of Difference by Tyler Fosnaugh

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