Just another quick reminder, Don't let your suppliers write your RFP for you!
I recently had a conversation with a fellow sourcing consultant that owns a reverse auction company. His organization specifically focuses on procurement for local governments. He shared his frustrations with a recent project that he was "awarded". This particular project was for a mid-western County Government's Public Works Department that needed to purchase two forklifts. The procurement group engaged my associate to conduct a Reverse Auction for these forklifts, but they provided the specifications, and were unwilling to listen to him about the need to open them up to allow suppliers to present their own alternatives.
Ultimately, he went to market with a specification that literally only a single forklift fit into. The specification detailed a 83hp motor, a specific mast size and a couple of other features that were unique to one specific manufacturer's model. (I will not give away too many details as the manufacturer could easily be traced with a quick Google search). Other manufacturers submitted their bids, which in many cases detailed more robust products for lower prices, or extremely similar configurations (such as everything being the same but the motor being 82hp, or all things the same, but the mast was off by half an inch), with extremely lower prices and better maintenace plans. The Public Works Procurement Department disqualified every single bid because it did not match the exact configuration that the maintenance department put into their purchase order request form.
Upon further investigation, my associate learned that the procurement department was simply unwilling to expend political capital arguing and explaining their findings to the head of the maintenance department. The head of the maintenance department was unwilling to look at alternatives or meet with other vendors, likely because he had a prior relationship with the salesman who put together the forklift specification for him.
At the end of the day, a local government overspent, and there really is no records to show future buyers that things could have been better. Worse, the same old ways of doing things continues to be the norm and the person that is footing the bill is you, the taxpayer. Please, don't let the supplier write the specification or RFP for you!
I recently had a conversation with a fellow sourcing consultant that owns a reverse auction company. His organization specifically focuses on procurement for local governments. He shared his frustrations with a recent project that he was "awarded". This particular project was for a mid-western County Government's Public Works Department that needed to purchase two forklifts. The procurement group engaged my associate to conduct a Reverse Auction for these forklifts, but they provided the specifications, and were unwilling to listen to him about the need to open them up to allow suppliers to present their own alternatives.
Ultimately, he went to market with a specification that literally only a single forklift fit into. The specification detailed a 83hp motor, a specific mast size and a couple of other features that were unique to one specific manufacturer's model. (I will not give away too many details as the manufacturer could easily be traced with a quick Google search). Other manufacturers submitted their bids, which in many cases detailed more robust products for lower prices, or extremely similar configurations (such as everything being the same but the motor being 82hp, or all things the same, but the mast was off by half an inch), with extremely lower prices and better maintenace plans. The Public Works Procurement Department disqualified every single bid because it did not match the exact configuration that the maintenance department put into their purchase order request form.
Upon further investigation, my associate learned that the procurement department was simply unwilling to expend political capital arguing and explaining their findings to the head of the maintenance department. The head of the maintenance department was unwilling to look at alternatives or meet with other vendors, likely because he had a prior relationship with the salesman who put together the forklift specification for him.
At the end of the day, a local government overspent, and there really is no records to show future buyers that things could have been better. Worse, the same old ways of doing things continues to be the norm and the person that is footing the bill is you, the taxpayer. Please, don't let the supplier write the specification or RFP for you!
Post A Comment:
0 comments so far,add yours