Using RFPs as a Competitive Procurement Tool
April 3, 2018
Category: Purchasing and Contracting
A Request for Proposal (RFP) is typically used for solicitations when an agency determines that price — along with qualifications — is the best method to achieve the intended outcome. The RFP requires specific information from the proposers indicating how they are qualified for the project and their solution to a defined problem, or the value the proposer brings to the project.
RFP’s are not used where solicitations require defined specifications, or for A&E services, and not in instances where the award goes to the lowest bidder. These solicitations require Invitations for Bid (IFB), or for A&E services; a Request for Qualifications (RFQ).
Examples of solicitations appropriate for an RFP are banking services, software, garbage collection services, non-A&E consulting services, public art acquisitions, and various studies and assessments.
There are statutes that authorize the use of RFPs in special circumstances. For example, RCW 39.04.270 authorizes an RFP for telecommunications systems and RCW 39.04.290; for building engineering systems. In both cases, qualified agencies are provided a process using the RFP. Agencies should be sure to document their decision to use these processes and the steps they take to meet the requirements.
General Elements of a Request for Proposals
There are several elements to an RFP, which are as follows
- Purpose. This section provides a brief description of what the procurement is seeking.
- Agency Background. This optional section should briefly outline how the project was developed.
- Goals and Objectives. This should describe what the project needs.
- Scope of Work. This section should be well-written and done so in a manner that encourages fair competition. It should include an adequate level of detail that addresses the tasks and products of the project. Clarity in the scope of work will help you avoid future disputes about intended performance.
- Selection Process and Anticipated Timeframe. This details the process for selecting an awardee.
- Evaluation Criteria. The evaluation criteria should be clear, should tie the criteria to the scope, and should identify the value in the scoring process to each criteria. Include the scoring matrix in this section and provide the decision schedule, if available.
- Submittal Requirements. In this section list all the information that firms should submit, including the firm’s general approach to the project, a list of key personnel who would work on the project, along with their experience and availability, and general scope and deliverables. It helps to keep the submittal requirements, page limitations, and due date in the same section of the RFP, and to allow for flexibility in the format of responses.
- Submittal Deadline. A good deadline allows an adequate response time based on the complexity of the project. Agencies should be willing to accept electronic proposals and should acknowledge receipt of all proposals.
- The Agency’s Standard Terms and Conditions. By attaching this information to the RFP, you are asking the proposing vendor to affirm that your agency’s terms and conditions are acceptable. If the terms are not acceptable, require that the vendor describe the reasons for taking any exceptions, and that the vendor propose alternative language. Include this as part of the evaluation criteria.
Agencies establish criteria for evaluation based on the priorities of the proposal. This criteria should correlate to the scope of work and the objectives of the project. Understanding the impact of the priorities to the project will help create an evaluation process that will lead to the selection of the best suited proposal. Be clear in the solicitation if you are expecting proposers to submit specific information to demonstrate how they meet any of the criteria.
Determine how the evaluation will be conducted while you are developing the RFP and conduct a few trials of how a proposal might be scored. Be sure that criteria that are most important to the project are assigned an adequate point value to reflect that importance. Going through this exercise in advance will allow you to make any necessary corrections to the solicitation before it is issued.
If you are using an evaluation team, meet with them before the proposal responses are due to discuss how the evaluation will be conducted. It will be helpful for the team if you first define how points are scored so that their evaluations are less subjective. This also provides for a more uniform process. For example, where 20 points are available to a criteria element, define what constitutes assigning a score of 1-5, what qualifies for a score of 6-10, etc. Ask evaluators to make notes when they are assigning points as this will identify what prompted them to assign the value given. This will assist in creating a response summary, which could be used in any follow-up with unsuccessful proposers.
Sometimes the complex nature of the project will require that the agency obtain professional assistance, not only in the evaluation process but also in developing submittal requirements that will be pertinent and important to proper evaluation.
Advantages and Disadvantages
The RFP process is fitting when dealing with a complex, complicated undertaking where price alone will not determine the best solution. It provides the agency an opportunity to discover alternative solutions that cannot be identified in advance. It can also allow for a combination of services and products in seeking a solution to a problem.
However, it is a process that requires a great deal of time and thoughtful input to develop a solicitation that will accomplish the intended objective. The agency must create a document that adequately identifies the project and the submittal information. Without that clarity, it is difficult for evaluators to properly correlate the responses to the project criteria and the desired outcome. This can be a costly undertaking, and the commitment to the process should reflect the level of importance of the project.
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