Procurement
March 7, 2013

A tale of three stories

My previous articles have talked about process and results-driven procurement, and the need to think when you “do” this important function. Here are three stories about process and results that are based on real events.

In our first story an organization had a professional services contract to support a priority project. With that arrangement about to end, a competition was started to find a contractor that would provide appropriately-qualified resources to do the work.

One bid was rejected because the evaluator, checking references, found that the bidder’s proposed resources claimed experience gained in working with the references that the references said they did not gain. Without that claimed experience, the resources did not meet the mandatory requirements; the bid was rejected. Another bid was found to meet all of the requirements; the contract was awarded and work started.

The rejected bidder questioned its evaluation. Preparing to respond, someone in the organization found that the person who had done the bid evaluation might have had a conflict of interest. The organization gave the rejected bid for re-evaluation to another employee without disclosing the previous reference check result; the employee found that the bidder met the requirements.

As this was evolving, a new element entered. The winning bidder was a former public servant in receipt of a pension (FPSRP), and the contract required Treasury Board approval. This had not been obtained. Also: the previous contractor had been this same FPSRP and Board approval had not been received for that contract either. The organization terminated the contract. A new procurement was designed, the call for bids issued, and bids received and evaluated. No bidder met the requirements – even the previous “winner” – so no contract.

More than six months after the previous contract ended, another call for bids had not been issued. One could wonder, then, how the organization planned to actually complete its priority project.

Story two is linked. An organization ran a competition for professional services estimated to be worth more than $100,000. It received a number of bids, evaluated them, and came up with the “winner.” It contacted that winner by telephone to say, “you won, contract papers to follow.”

A couple of days later the winner, an FPSRP, got another call. Due to the contract value the contract would require Treasury Board approval, but since the organization could not wait for the time needed to get that approval, it was awarding the contract to the second-ranked bidder (not an FPSRP).

Story three comes from a task authorization contract, a master agreement within which the client can ask its consultant to carry out specific work packages. After discussion and an understanding by both parties of the specific work to be done, as well as agreement on the time and cost, it was decided the individual deal would be signed off as a task authorization – in other words, agreed work for an agreed price.

The contract said that if the consultant had to travel to the client’s city to work, the client would give the consultant money for hotel and daily expenses on arrival at the work location. First task, first trip – no money. The client said that its financial system did not permit a payment like this and so the consultant would have to submit an invoice. It then took 14 weeks for the consultant to receive the money.

That task authorization had the consultant staying in the city for 15 agreed-to working days. Filling time, the consultant also worked evenings and weekends, working about 24 days in total. Because the authorization had agreed on 15 days, that is all that the consultant was paid for.

The next task was negotiated, with three separate but related work elements. The consultant did the time estimates: five days for two of the elements, six for the third. Even knowing about the significant extra time already contributed by the consultant, the client refused to accept the six days, insisting on five. The consultant needed the work – the deal was signed. When the consultant invoiced, more than 18 days had actually been worked, but the payment could only be for 15 days.

There you are. Do you see many different considerations to think about? We will take up the discussion next month.

John Read provides procurement consulting services to public sector clients. He served for almost 15 years in the Public Works procurement arena.

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