This summary will help you narrow down your decision-making throughout the procurement process. It gives you something to measure every decision against – stopping you from going off on a tangent and preventing the kind of bloat that comes from falling for every fancy feature a salesperson promotes to you.
That said, by all means talk through your aims with your potential suppliers – if your aims are vague, admit as much. They are there to help you understand the ‘why’ – and sell you the ‘what’ you need to achieve it. If they can’t help you understand the why, they probably don’t understand your needs well enough, and might not be the right supplier for you.
When it comes to defining your needs, decide who your key stakeholders are rather than trying to please as many people in your organisation as possible. Don’t conduct research horizontally across every team. Do it vertically – speaking to key people about corporate objectives and end users about their needs. Aim to marry the needs of the organisation with those of your end users – if you don’t, you’ll find your project becomes a mish mash of diversions caused by asking too many people for their opinion. Don’t cast your net too wide.
Say how important requirements are to you
This requires discipline, and probably a certain skill at navigating internal politics. By informing suppliers that requirement A is a must-have, and B is a could-have, you’ll help them build a quote that fits your needs. Look into using the MoSCoW method.
The classic example is the technical requirement for ‘integration’. You could marry both systems to the point where every function or feature is shared seamlessly, which would take months of work. Or, you could just create a hyperlink - taking under a minute to complete.
By allocating priority, you don’t get quotes that are bigger than they need to be.
Be open about your budget
Don’t be afraid to be upfront about how much you can spend. It helps suppliers design something that you can afford. By not providing at least an indicative budget you risk receiving quotes for all-singing, all-dancing solutions that are ten times your actual budget – wasting both your time and your supplier’s.
If you’re concerned about suppliers simply padding their quote to fit your budget, compare the value they offer with other proposals. The suppliers who simply quote to take all of your budget may have dramatically differing costs associated with well-defined areas of the tender than others. Drill into options that appear to be over-priced in comparison to others, where’s the added value? Have they delivered this for other clients?
The best way to define your budget is by understanding what you’re trying to achieve and deciding how much money it is worth to you. If you can’t conduct business analysis to establish this, then speak to others in your industry who have bought similar solutions and ask them to give you a ballpark figure. If they’re coy about the exact amount, give them price brackets and ask them which their project fits into. Did it cost between 10k and 20k, 50k and 100k, or 1m and 2m? This will help you narrow down whether you can realistically achieve what you want to do with the money you have available.
Having a clear idea of what you can afford, and what you want for your money, helps move the process forward considerably when talking to suppliers. Have early conversations with vendors telling them what you're trying to achieve. Ask them if they can provide an indicative quote if you give them all the detail you have about the project.
Procurement frameworks such as G-Cloud and DOS are a great resource for organisations in the public sector. They offer a relatively simple and streamlined method of procurement, removing the need for a full tender process, and they publish pricing. Even if you don’t end up using a framework for your project, they are still worth checking to get a reference for setting a budget.
Follow the rules
Finally, make sure your procurement process is watertight. This way no suppliers can challenge your procurement process if they lose. A challenge can set procurement of a project back several months – costing you a fortune in time and lost opportunity, and meaning you have to pay to go out to tender again.
Write down the purpose of this procurement in fewer than 200 words to test your ability to frame it clearly
Speak to suppliers early on in the process
Follow the rules to avoid costly re-runs
Research the typical cost - the data is out there
Be open about your budget