One of the complaints I hear from contractors is that some of the larger RFPs that the government issues do not contain concise information to bid properly.
In order to get an accurate bid, you need bids that can be compared apples to apples. It is fair to say that there are numerous areas of concern in relation to RFPs, many of which are shared with tenders and other forms of competitive procurement.
Others, particularly the method of evaluation, are either unique to RFP procurement or of a greater order of magnitude in relation to an RFP.
When I attend debriefs with construction clients I am often not surprised at the stock answers they receive from staff.
My issue has always been that the evaluation method is far too speculative in nature and leaves a great deal of room for how these RFPs are scored.
It is the general consensus from contractors that municipal staff evaluating these construction bids do not have enough industry experience to conduct a fair assessment.
After sitting in on so many debriefs over the years, it would be hard for me to argue against the theory.
One of the most important distinctions between an RFP and a tender relates to the kind of submission that bidders are expected to make.
In a tender, the bidder completes a relatively simple form that requires it to disclose its price and provide certain other basic information.
It may also be expected to provide a few additional documents (e.g., a bonding commitment) to confirm it will be able to carry out the contract if awarded. From the contractor’s perspective, a tender actually represents a relatively simplified and low cost method of seeking business, in comparison to the lengthy wooing efforts that are usually employed in private sector procurement.
With an RFP, there is a manifold increase in the burden imposed on the contractor in order to prepare and submit a proposal and thereby participate in the contract competition.
It is self-evident that in order to accommodate the complex kinds of proposals that are submitted in response to an RFP, it is necessary to move a considerable distance from the rules that govern an ordinary request for tender.
In part because the RFP process is so demanding on contractors and in part because it is no less demanding on municipal staff.
It is the standard opinion to consider to engage in some sort of prequalification exercise in which a shortlist of prospective contractors is identified before the most detailed work begins.
In such cases, the municipal bylaw needs to deal with whether the list of prospective contractors should be limited to those who have pre-registered or prequalified; when (if ever) should prequalification be mandatory; how should the prequalification process be conducted; and what considerations are relevant.
Prequalification should be based on the contractor’s ability to demonstrate having completed projects of a similar nature.
The question then becomes what exactly does similar nature mean? I would think if you have built many schools over the years, you could build a community centre. When owners stipulate in a RFP that you must have built three community centres (over a certain price) in the last five years, and don’t take into consideration work of a similar nature, you considerably cut down the pool of available bidders.
The issue that I have related to RFPs are when they are treated as a math equation, meaning that the points assessed to each of the weighing criteria can be manipulated.
This stems from when the points assessed in each section of the evaluation process are not explicitly set out or left vague on purpose to pick the contractor that the owner feels would do the best job as opposed to the contractor that has put forward the best proposal.
Stephen Bauld is a government procurement expert and can be reached at swbauld@purchasingci.com.
Some of his columns may contain excerpts from The Municipal Procurement Handbook published by Butterworths.
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