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A Strategic Guide with insight from THE CENTER FOR DIGITAL GOVERNMENT

RFP and Vendor Selection

The RFP should be tailored to each organiza- tion’s unique business processes and system’s environment. A third-party consultant can help to develop the RFP, assist in evaluation of responses, select the vendor, and negotiate the final contract. Since a strong working relation- ship between the government and vendor is required, cities should avoid over-reliance on third-party advisors.

One way to streamline the RFP process and improve vendor selection is to provide as much information as possible concerning the scope and expectation of the project. The bet- ter those vendors understand the environ- ment, the less risk is assumed. Vendors gener- ally build cost for risk into their proposals. Therefore, a thorough understanding by the vendor will ultimately reduce cost. Three of the most important points to cover in the RFP include:

  • Detailed SOW that is required and description of IT system environment;

  • Service levels expected and performance measurements that will be incorporated; and

  • Proposed terms and conditions expected to be met.

The Indianapolis/Marion County RFP included the organization’s vision and strategy; IT strategic initiatives; an overview of the agency; the agency’s outsourcing goals and scope; and SOWs for all of the business groups (data center, network, help desk, distributed computing, and application services), including their related service environments, service requirements, roles and responsibilities, and service level expectations.

Considerations during this step include:

  • Hiring a consultant to help analyze system environments and business processes.

  • Talking to vendors to see if there is inter- est in responding to the RFP.

  • Holding a vendor conference to answer questions.

  • Inspecting references and qualifications. A financial background check will help to ensure that the company is viable over the long run. Both the county of San Diego and the city of Minneapolis evaluated the financial background of the companies to verify their long-term stability. Previous local government experience is a positive sign that the vendor will bring value to the project.

  • Focusing on the quality of the vendors before reviewing the costs to keep the choices subjective. The city of Minneapolis narrowed the choice down to two ven- dors and then capped the cost of the proj- ect at a specific amount so that cost was removed from the issue. The two ven- dors then compromised on certain areas within their proposals to meet the requirement.

  • After narrowing the choice down to a select number of vendors, visiting the ven- dors’ sites to view facilities and experience the culture. The city of Minneapolis’ CIO visited the vendors in their locations and looked at their facilities before negotia- tions began.


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