|How not to do an RFP|
Despite all the work up to this point, the most trying phase is the last--a decision must be made. All but one of the vendors will be disappointed. In particular, if the incumbent vendor loses, there are sure to be complaints from inside the organization.
Although there's some creativity in the decision-making process, much of it can still be carried out systematically. Here are the steps you should take: Narrow the field. Based on the review of the proposals, limit the review to three or fewer vendors.
Structure the presentations.
Invite the vendors to present their solutions, but carefully script the topics they should address. Limit the areas they cover. Some find it useful to have vendors present the parts of their bids deemed weakest.
Scrutinize the ROI. Every ROI justification takes some liberty with the facts, or at least makes debatable assumptions. Have the vendors explain in detail the derivation of their cost justifications.
Consider proof of concept. Some data center staff demand to see the proposed solution in some form of production configuration. This usually takes a significant amount of time on both the vendor and the organization's part. This approach is advisable for solutions that contain recently released or less well-known components, but not for those with wide distribution or marketplace acceptance.
Select with conditions. When selecting a vendor, ensure that the contract lists the satisfactory completion of a series of specific tasks before the vendor is paid. In some cases, this will prevent the vendor from counting the revenue until the criteria are complete. This is your insurance policy, so it should be non-negotiable.
To successfully work an RFP process requires commitment and sometimes third-party assistance. There are consultants who specialize in helping companies through the RFP process.
How will you know if you're successful in this process? Consultant Brown says that in the best RFP initiatives he has seen, "vendor proposal prices are within a narrow bandwidth of less than 10%. When the requirements are well-defined, each vendor must meet them. It is only when requirements are vague that vendor interpretation leads to wide gaps in vendor pricing."
Successful procurements executed along these lines can become a point of synergy between the IT managers and their internal customers. The payback for this type of deliberative and comprehensive storage acquisition rests in the confidence that the solution will not only exceed expectations, but that it will do so at the lowest possible cost and in such a way that business needs are addressed.
This was first published in June 2004