Thursday, 06 October 2011 19:31

Evaluating a Service Provider Proposal - Part 1

Written by  Kathryn Douglass
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Pay Me Now or Pay Me Later…

How much work is involved in the review and evaluation of outsourcing proposals?  The amount of work you will have to do on the proposal evaluation is inversely proportional to the amount of work you put in on the development of your outsourcing requirements. This may sound a little counterintuitive, but let me explain.

For example, if you write a high level set of requirements, you might think that the proposals would be easier to review than if you write and must review detailed requirements and solutions.  In a way, you would be correct. If you write high-level requirements, the proposal review will probably be somewhat easy, because the responses will probably be a bit vague and generic.  If the service provider team doesn’t understand your exact requirements, they may try to cover the waterfront to ensure that they are not eliminated.  There will be plenty of marketing materials and handy information on capabilities and service offerings, but little that is specific to your needs. 

If your team hurried through the requirements phase and didn’t do a very thorough job of data collection and reconciliation, they will mostly likely be barraged by questions from the service providers after they read the RFP, and you should expect to spend considerable time reissuing clarifications, corrections and updates.  You may also find that the service providers are forced to make assumptions, due to lack of information or conflicting information.  When this happens, each service provider will make its own set of assumptions, making it difficult to review and compare the proposals. 

Unless adequate time and care is spent matching the business strategy and sourcing requirements and getting approval and support from the executive team, your team may face changing requirements, unclear communications and confusion on both the provider and company side.  This makes for a very difficult evaluation period -- the teams are unclear what they are trying to achieve, proposals miss the mark, and frustration abounds on all sides.

If you choose to instead do a good job of defining your objectives and required outcomes, along with a thorough set of outsourcing requirements, you will have a much better chance of getting what you want, and avoiding contracting nightmares, escalating costs and "do-overs".

Next:  Does Yes Really Mean No?

Last modified on Monday, 03 September 2012 21:58

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