Procurement
September 13, 2013

What’s in a year’s worth of experience?

How often have you seen buyers use years or months as a measure of experience – “…at least three years’ experience in the last five years” – or by awarding points based on time? It makes little sense.

It does not measure the quality of results produced, the increased value-added that a supplier can offer as a result of experience, or the potential contribution (innovation, different perspectives) of a newer, less experienced player. It rewards contractors who work slowly for clients by letting contracts drag on. It says that a year less a day of experience is significantly different from a year plus a day, or that three years of the same thing is as valuable as three years of great variety.

Equally bad is not defining “year” or “month,” leaving potential bidders to meet an unknown requirement; and bid evaluators to apply subjective unequal measures.

Another popular clause in calls for bids says something like: “…the month(s) of experience listed for a project in which the timeframe overlaps that of another referenced project will only be counted once. For example: Project #1 timeframe is July 2010 to December 2010; Project #2 timeframe is October 2010 to January 2011; the total months of experience for these two project references is seven (7) months.”

If you work two weeks in a month you can claim a month of experience. Work two weeks for each of two different clients and you get the same month for a quite different qualitative experience. But wait: if you only worked two weeks, does it count as a half month? Or as nothing? If a project only required work for a couple of days in a month – or included a month or two with no activity – does that count? This is confusing and not fairly measurable.

The average work week in the U.S. is about 33 hours; in France, 30; in the Netherlands, 27; and in South Korea, 40. A work week is not a standard, and extending the concept to months and years means that comparing bids from different suppliers based on time will not compare equivalent information.

Is a “year” 12 months, 240 working days, or something else? Practically no-one (including public servants) actually works 12 months a year: people usually take a few weeks off for holidays, they may be sick, and spend training time to upgrade their knowledge and skills. If a year, then, includes bits and pieces of work, is experience gained over a period of broken-up assignments, and aggregated to come up with an equivalent to year, worth more or less than the same number of days worked consecutively?

Clearly week, month and year are relatively meaningless terms. Why do we see them used so often? To begin with, it is fast to develop and easy to measure. The hiring body just needs to plug in arbitrary years and go; if anyone asks that the requirement be more flexible, refuse. When the contract goes sour, it’s not their fault because they did require years of experience. The problem is, the measure was arbitrary and meaningless.

Qualifying suppliers based on elapsed time rather than results achieved and potential value-added is contrary to best practice procurement, where you seek results rather than process. You also have an obvious recipe for playing with bid evaluations by measuring time unequally and subjectively. If you shade your evaluation this way, you are both acting improperly and proving that your initial specification of time was a fabrication. You encourage “fudging” the numbers for what is essentially an irrelevant criterion.

Good procurement takes knowledge, time and effort. Replace arbitrary but irrelevant years with what experience means for you. Look at the risks if the eventual contractor does not have some characteristic or qualification. If this will cripple your project, make it mandatory; if it can be managed, point rate it.

If you try to distinguish between bids based on time, be ready to justify why you use each specific number. Never risk shutting out potentially excellent suppliers for lack of a basically meaningless day.

As government austerity continues, and the supplier community grows, there will be fewer contract opportunities and less work for any given supplier. That will make it increasingly difficult for suppliers to meet requirements relating to arbitrary numbers of projects or “years” of experience. Over time, in fact, there will be fewer and fewer suppliers that can meet mandatory requirements, much less rated ones.

Access to contracts will decrease, competition will decrease and the government will succeed in contravening its own contracting policy.

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