MYSTERY BUYER CARDS ON THE TABLE
TOO OFTEN THE RFP PROCESS IS HAMPERED BY A LACK OF TRUST BETWEEN BUYER AND SUPPLIER
I THINK THE GREATEST OBSTACLE in the request for proposal (RFP) process is the lack of honesty on both sides: the supplier and the buyer. We are cur- rently running an RFP for a global travel management company (TMC), and at the start of the process I offered every interested supplier a one-hour brief- ing session, when I told them about the business, existing contracts, things that were and weren’t working, and what we were looking to achieve. People said they appreciated this, because a lot of companies will not share that informa- tion – and I was very surprised to hear that. I don’t understand why buyers wouldn’t start the process by saying: “This is what we have and this is what we are trying to achieve.” We need to be open with suppliers and to give them the opportunity to do their best. This isn’t a game to catch people out. We are trying to find the supplier that is the best fit for our business, and we can’t do that if we don’t tell them what we have and what we want. Some buyers allow minimum communica- tion and I think that’s a real problem. You are dealing with people when you are buying services, thus you have to allow discussion, so you can get a feel for how these companies operate. This goes for the supplier side as well. I also asked the project team for deal break- ers and put those in the RFP. If we are going to reject companies that do not have a physical presence in certain locations, or if they don’t operate with specific technology, they need
Let’s talk about these weaknesses and how we can overcome them, rather than covering them up
to know that. It’s an expensive process for suppliers: particularly, in a global bid, it is a big investment in time and people. We also showed how we had weighted each section – we made clear that we want accurate, detailed responses to every question, but doing this meant the suppliers knowing where we are placing greatest emphasis. In addition, the transaction data that
we have is limited, and we’ve been honest about that, and have shared what we can. But we have factored into the implementa- tion process a discovery phase of up to three months, where the supplier can send their analysts in and do a detailed investigation on the data we do have, so we can build a final contract around that information. You can mitigate problems by acknowledging them on both sides.
Lack of honesty on the suppliers’ side
is more basic. Suppliers have come into a presentation and claimed to have fully owned
offices in specified locations, but we’ve done our homework and pointed out that we know one of them is franchised. That makes them look bad. Sometimes they tell us what they think we want to hear. It would be far better if they said: “We know you want us to be wholly owned in all these locations – we’re not, but this is how we can guarantee you’ll get the same level of service...” There seems to be nervousness around TMCs admitting their weaknesses. Let’s talk about these weaknesses and how we can overcome them, rather than covering them up. And when we ask suppliers to bring
account managers who will be dealing with our staff to presentations, some suppliers bring their vice-presidents and directors, who are very passionate about their business but can’t necessarily answer questions about the day-to-day running of the account. We need a standard format for running tender processes. Procurement profession- als can become CIPS [Chartered Institute of Procurement and Supply] or CIMA [Char- tered Institute of Management Accountants] accredited, to create a standard. But because we don’t have that, buyers can make it up as they go along. But it’s within our power to drive changes within procurement that create consistency and improve the process.
ONLINE COMMENTS
A basic problem for the buyer is evidencing the pricing that bidders put forward – it would be far more reflective of what you would get in the real world to separate the quality/ capability part of any RFP from the delivery part, and put TMCs into a ‘mystery shopper’ environment...
38 BBT JULY/AUGUST 2015
BUYINGBUSINESSTRAVEL.COM
Illustration: Ben Southan
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