Transcript Distinctions Or Definitions

Cost of RFP’s
(and the resulting contracts)
Charles Johnson
President
Total Contract Solutions, Inc.
Ground Transportation Consultants and Trainers
888.827.8271
www.totalcontractsolutions.com
TO TAL C O N TR AC T
S O L U TIO N S , IN C .
Emphasis on Ground
Transportation
• Concessions
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Taxi
Shuttle
Limo
Parking
Curbside Manager w/ Fees
• Services
– Curbside Management
– Parking / Satellite Shuttles
– Training
– Consulting
– Contractor Audits
• Specialty Systems Such as
– AVL, Traffic Control, etc.
Cost Perspectives
• Cost of the Process
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Direct Cost
Overhead Cost
Opportunity Cost (Inability to Respond)
Impact of Contingency Costs and Mistakes
• Cost of the Results
– Cost and Qualitatives of Reduced Competition
– Ongoing Administrative Cost
• Airport
• Contractor
– Cost to Patrons
• Airport Pass-Through
• Contractor Pass-Through
• Non Cash or Qualitative Cost: Time, Convenience, Safety)
– There is no such thing as a “free lunch”
Lowering the Cost of RFP Process
• Organization / simplification of RFP and proposed
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response requiring. Don’t make the same mistake twice.
Time to obtain clarifications, time to respond after
clarifications received
Cost driver information w/ RFP
– Include reporting requirements in the RFP
– Provide as much historical information to proposers as possible
• Post electronically (if not, advertise facts)
– Cheaper process
– Improves competition
• Reduce number of mandatory conferences
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Lowering the Cost of RFP Process
• Consider asking for summaries of systems rather than
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copies of procedures
Emphasis on meeting DBE’s after the contract rather
than before
Flexible on minimums
– Minimum experience
– Audited financials
– Reasonable bonds
• Flexibility for responses on operational details (don’t
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over-spec). Use language like “All necessary, including
but not limited to . . .”
Simple yet valid and reliable scoring systems
Lowering the Cost of RFP Process
• Avoid cost reimbursement contracts
– Administrative costs
– Lack of incentive to lower costs
• Consider options pricing
– Dedicated versus non-dedicated
– One contractor versus multiple
– Bundled versus unbundled services
Reviewing an RFP
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After quick review for interest / green light
Shoot for one complete reading, top to bottom
Either markup or better yet a recorder
Action items
– Proposal to-dos: “Go to the next proposal action item and add…”
– For cost to-dos “Go to the cost and pricing section and add …”
– For summary items “Go to the row for [fill-in] and say…”
• “Go to the questions and add . . . Or “Pull from stock
question”
• “Copy and paste the proposal outline . . .” then “Go to
the proposal outline and note in brackets”
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Systems Concepts for Modules
• The system concept: proposal and
advertising modules, procedures and
training materials, all ready for proposals
• Constantly improving these documents for
multiple recipients and uses
• Master and subdocument concepts
• Systematize so never lose previous
improvements
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Naming Conventions
Proposal for:
[Customer Long] (“[Customer]”)
[Project Long] (“[Project”])
RFP # [Project #]
Submitted by:
• [Company Long], ([“Company”])
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Workgroups and Networks
• Librarian: shared access, human, both or
software controlled?
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Proposal modules
Sales presentations
Procedures
Training
Advertising / Marketing Presentations
Web Site
• Network rights (“read only, create, etc.)
• New software systems for file sharing
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The Proposal
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Firm “Qualifications”
• History
• Financial Health
• References
• Accounting Systems
• Memberships
• Philosophy
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Personnel
• The Staffing Plan / Role Narrative
– Discussion of roles and talents. Photos?
– Include some personnel oriented text, programs, etc.? Photos?
– Job descriptions (exhibit?) or just the role outlines?
• Organizational charts (a must)
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Organization overall (and combine project?)
Project version (unless generic RFP)
Can include support by outside entities
Option for more detailed “reference chart” especially if incumbent and include
contact information, photos, even basic duties descriptions, etc.
– Software
Bios
Resumes (exhibit?)
Staffing charts
Newsletters exhibit?
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Your Organization, Inc.
Project Organizational Chart
Corporate Rescouces
Clients
METRO
Ihav Namo
Project Mgr.
Total Contract Solutions Inc.
Consultants
Karen Ring
Call Center Mgr.
Dispatchers /
Routers
Ima Safety
Safety & Tng. Dir.
Monty Python
Asst. Project Mgr.
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Employee Drivers
Accounting
Communications
Data Processing
Driver Services
Finance
Logistics
Maintenance
Personnel
Quality Control
Risk Management
Safety & Training
Reggie Boss
Reg. Mgr.
Accounting Dept.
Quality
Assurance& Audit
1,742
Ind. Contractors
Lettuce Fixit
Maintenance Mgr.
Will Bendit
Body Shop Mgr.
MIS
Maintenance Shop
Asst. Dispatchers /
Routers
Body Repair
Technicians
Mechanics
Customer Service
Representatives
Red Skelton
Chief Painter
Service Attendants
Painters
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Facilities & Equipment
• Glowing Terms
• Color Photos - People too!
• Equipment Lists
• Subcontractor Facilities OK Here!
• Existing / Proposed Equipment
• Technology / Dispatching
• Driver Areas
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Vehicles
• Vehicle Analysis Spread-Sheets
• Make Capacity Assumptions Explicit
• Vehicle Options & Charts
• Capacity Cost Modeling
• Vehicle Vendor Selection
– Long Term Cost
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Vehicle Specs
• Layman’s Terms or “Performance Specs”
in Proposals Typically, Details to Exhibit
• Provider Prepares Exhibit
• Purchase Order / Specs Performance
Based
• Spare Parts in Bid
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The Startup Plan
• Provide, Discuss, Finalize, Purchase,
Execute, Revise, Develop, Install, Receive,
Communicate, Brief, Train, Attend,
Prepare, Hire, Issue, Monitor, Assign,
Perform ...
• Methods for Presentation
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The Start-up Plan
• Philosophy
• Start Out Right (consultant?)
• Startup Resources
• Communicate Progress
• Cross Referencing
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The Startup Plan
• Target Dates (Now / Later)
• Achieving the Impossible
• The Gantt Chart
• Milestone Charts
• Tracking Charts
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The Operating Plan
• Using the RFP as the Guide
• RFP Outline in Skeleton
• Parroting Text: Pros and Cons
• “Exceed”
• Operating Procedures
• Innovations (Backup Service, Service
Options)
– The Operating Plan
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The Operating Plan
• Importance of Committee Make-Up
• Experience is the Best Teacher
• Pre-bid Conference Notes
• Emphasis for Each
• Incumbent Issues
• Flexibility on Details
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The Operating Plan
• Procedure Manuals
• Internal Reference Lists
• Diagrams / Flow Charts
• Job Descriptions
• Prop Photos = Tng Slides
• Marketing
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Communications and Reporting
Plan
• Statistics
• Performance Reporting
– The Open Book
– Over-Reporting (slightly)
– Graphing & Quality Control
• Availability / Acting On
• Technology & Communications
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Regulatory Compliance
• The Easiest Text to Obtain
• The Hardest Text to Understand
• The Outline Summary Method
• The Procedure System / Training
• Who Ya Gonna Call?
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Regulatory Compliance Examples
• ADA
• Clean Air / Alternative Fuels
• CDL Requirements
• Drug Testing
• Facility Issues
• FTA Regulations
• Health and Human Service Regulations
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Serving the Disabled
• Staff Training Before Proposal
• Describing Procedures
• Describing Philosophy
• Sensitivity Training
• Driver Training
• A Very Important Area
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Maintenance
• Describing the Processes
• Preventative Maintenance
• Commitment
• Management Info & Control
• RFP Language
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Operating Systems
• Claims and Accidents
• Routing and Scheduling
• Run Cutting
• Personnel
• Operator Scheduling, Timekeeping
• Dispatching and Turnout
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Operating Systems
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Communications
Reporting
Vehicle Maintenance
Billing
Call Center Management
Telephone Equipment
Call Distribution
Statistical Analysis
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Alternative Fuels
• Fuel Type Options
• Dual Fueling
• Fuel Station Decision
• Pros and Cons
• Local Regulation
• Cost Factors
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Quality Control
• Mutual Specs
• Measurement
• Employee Involvement
• Procedures
• Total Quality
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Quality Control
• Vehicular Maintenance
• Cost of Poor Quality
• Purchasing and Quality
• Procedures & Training
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Adding Proposal Sections
• Innovative Items
– Service Options
– Backup Service
• Communications & Reporting
• Operating Procedures?
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The Price Proposal
• Explanatory Text
• Assumptions (Understanding but may help
protect also)
• Reasonableness and Value
• Highlight Driver Benefits, Technology
• Increases in Hours or Trips
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The Price Proposal
• Development Roles
• Price Schedules
• Cost Data
– Review Clauses
– Importing / Organizing
• Fixed, Operating, Startup, Overhead Allocation
• Someone on Committee Probably Loves
This!
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Pricing Options
• Purposes
– Competitor’s Pricing & Items
– In-house Pricing & Items
– Win-Win Options
• Fuel Inflator / Deflator
• Capital Cost
• Technology Gains
• ETC.
• Other Options - “Integral”
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Contract Cost Primer (More later)
• Cost Ranges (Hi, Med, Low)
• Naming Variables
• Year Zero Costs
• Cash Flow Schedule
• Interest Costs
• Profit Determination based on risk
• Sensitivity Analysis
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Exhibits
• List of Exhibits: Volume 2
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Exhibit
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Documents to Be ...
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Insurance....
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Vehicle Specifications
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Manuals / Forms
• 4,5,6... Consultants / Subs / Tech
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Final Touches: Very Important /
Need Time to Work These
• Cover Letter
– Incumbent
– Emphasizing Evaluation Criteria
• Executive Summary
• Table of Contents, Detailed (or Amplified): More
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important than you think
Compliance Matrix
Table of Figures (once you have enough figures)
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What’s Next:
Negotiating, Contract
Law, Startup and
Problems
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Thank you
© Total Contract Solutions, Inc.
www.totalcontractsolutions.com
888.827.8271