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Five Tips for Effective Mobility Supplier Selection

At this month’s Bay Area Mobility Management (BAMM) conference, I spoke with several of my friends in the industry who’ve shared with me (usually with a very pained expressions on their faces) that they “have to rebid” parts of their mobility program. I’m not sure that anything elicits the kind of dread from the people I know in HR and Mobility that having to do an RFP or to select/reselect suppliers seems to. I understand their pain. For starters, putting together and managing an effective RFP is a lot of work. But really, none of the people I spoke to are afraid of work or are lazy. I don’t think it’s the work that bothers them, so much as having to manage through all the process steps within their own companies, the meetings etc., and then having to wade through the endless (frankly no other word for it, BS) from the dozens of suppliers who will beg to, or are asked to participate regardless of capability or fit.

Let’s face it, selecting a service provider can be a painful process, sorting through all the material, the presentations and sales pitches, some of it irrelevant or immaterial, some stretching, dissembling and prevarication that might make politicians blush, and figuring out how to objectively determine what the best choice is for their organization and program. It’s also painful because much rides on the decision. The mobility people I was speaking with last week are anxious about this at least in part because they, and their companies will have to live and work with their decision for years. Think not Tinder.

In my career in mobility I’ve had the experience of being on both sides of the procurement or supplier process. I’ve sold and managed the RFP process on the sales side, and also as leader of the global supply chain for a major mobility company, I managed supplier selection, including producing and evaluating RFPs across numerous product lines. Because of this experience and my passion for this area of our business I’ve also been asked to consult and help companies both supplier and client better manage this process.

So what are some ways that we make this process better, assure improved choice and make the process easier? I’ve put together some tips that I think apply to anyone looking to select a mobility supplier, or really any service for that matter. Please be mindful, these are tips, not a comprehensive instruction manual. Of these five, the first is probably the most critical.

1. Know your End Goal: Before beginning any supplier selection process, it’s very important to do your homework and think through all of the requirement and the goals and objectives you have for this service. Some of the important lenses to review these requirements are spelled out in the categories below:

  • GOVERNANCE: These are the “rules” your organization has that any supplier must conform to. It includes the basic technical, contractual, and legal requirements for service providers. These usually involve managing supply chain risk for your company and includes key elements such as data privacy, conformance to legal standards, insurance standards, and more. It’s important to know these and build them into your selection process up front.

  • VALUE: You should know what budget you have, and what cost criteria you are looking for your defined scope of work. No one should ever start an RFP process without understanding these basic criteria. Yes, you can learn a lot during the process, and sometimes be exposed to alternate cost models, better value propositions, but if you do not have a basic understanding of what value you are looking for, you aren’t ready to begin selecting a supplier/partner. Before starting the selection process, do your research in this area, even utilize suppliers to tell you what they are seeing!

  • PERFORMANCE: What are the standards of performance for the scope of work you need and would like to see from any supplier or service in this space? These can be revised (hopefully upward) in the process, but how do you define performance and what are the baseline standards of success. What are suppliers in this space telling you they use as performance criteria and is there anything new or valuable there?

  • FIT: These are the factors you consider important when determining the right fit for you and your company. For most mobility services there are literally dozens of good suppliers, but some would be better than others. For example, are you a data driven organization, looking for analytics for most decisions? Or, perhaps you are an organization less interested in policy, so you need suppliers capable of discernment and fluid decision-making. Define this clearly upfront and make sure you have built in ways to identify this in your selection process. These are sometimes the most important and yet overlooked parts of the selection process.

2. Partner with procurement: Most companies require periodic bids on services, or a defined procurement approach for service spend of a certain size or service area. Mobility professionals who leverage the relationships with their procurement colleagues by partnering find the collaboration useful. Informal feedback I’ve received from several mobility leaders has been that the most important factor in this partnership is upfront education of the assigned procurement person. This is easiest in organizations that assign procurement “leads” to the HR or Mobility organization, rather than an-hoc assignment of staff, but in either case, the upfront investment is worth it. Use the landscape discussed above as a format for the discussion and planning.

3. Learn through an RFI process: Before producing an RFP (Request for Proposal), utilize an RFI (Request for Information) to learn and shape your next steps. An effective RFI can help you discover what may have changed in the field, it can help you better define your scope of work, your expectations of suppliers, and can help you eliminate or add to the list of suppliers to participate in actual bids. A good RFI is very short and simple, and open to a wide variety of potential suppliers I suggest limiting the number of questions severely limiting the number of words in the response. You do not want to have to read, and cannot constructively evaluate hundreds of pages of materials, but imagine an RFI with five questions, allowing 200 words or less in each response, with one or two questions allowing creative and open ended responses that potential partners can use to educate you on what’s important to them. “What do you think is the most important criteria for selecting a partner in this service area?” or “What should we know about changes in this area that should shape our decision?” are both great learning questions.

4. Simplify: Service providers all have RFP horror stories, the RFPs with 10,000 pricing entries on a grid (yes, I’ve had to fill those out), the 1,000 plus questions. My worst RFP experience spanned two months including 25+ hours of conference calls as I drove through California’s redwoods and wine country on vacation with friends —I’ll always regret and never recover that part of my life). As a provider, the worst thing about these experiences is knowing, with absolute certainty that the selection committee would never read or use the vast majority of the responses. As someone selecting a provider, it’s also a terrible waste of your team’s time and resources. So how to simplify? That’s the real question. Take these steps:

  • Separate pass fail questions from qualitative analysis questions: There may be 1,000 items you or your organization must have in place to do contract with a supplier but ask those questions as Yes/No. It simplifies analysis and allows you to quickly identify gaps without lengthy reading. This also allows you to eliminate suppliers who quite simply do not qualify before reading every response. There are other (hopefully fewer) areas where you want to more carefully review and evaluate the quality of the answer.
  • Provide a pro-forma contract: Particularly if your organization has strict contractual requirements, high data security or technical requirements, provide these upfront and ask suppliers to commit to these terms or these standards as part of the RFP process. If they cannot commit, they will likely not respond, and it saves you the trouble of reading and evaluating a response from someone you cannot do business with anyway. Suppliers may not like being disqualified through these standards, but for them it’s very preferable to working hard on an RFP and learning later that they don’t qualify on a technical detail they cannot or would not address. I’ve spoken to some sources in procurement who do not like to eliminate suppliers this way, because it also reduces the set of pricing they can use to leverage better pricing from suppliers, but is it really worth it and is it really fair to your team and the potential partner?

5.Determine Clear and Specific Scope of Service: Of all the areas of the selection process that can be most frustrating to service providers, that prospective clients do not define the scope of service is one. In your selection process if you do not clearly define the scope of work you are looking for it is extremely difficult to select the write service provider, and it’s almost a guaranty that you will contract at pricing that is not good for your organization. Defining the scope of work can be a challenge, but is an essential foundation for the future of your relationship with your new supplier. I once responded to an RFP (for immigration services) and the prospect did not define scope of work. To make matters worse, they used an on-line reverse auction for the pricing component. We tried to anticipate a reasonable scope of work and bid correctly, but during the auction one competing supplier bid $95 per case. Later I learned that this supplier had defined their scope of work as “accept the initiation”. In other words, everything beyond that step was out of scope and would be subject to additional and undefined fees! When selecting a service provider, defining your scope helps you identify your needs vs. the nice to haves and make the best value decision for your company.

One thing that visibility to both sides of the supplier selection process has given me is an appreciation for the amount of time and effort it takes for BOTH sides of the equation to participate successfully. I’ve personally participated in proposal responses that have taken more than 250 hours (in other words more than 6 weeks of work) for my organization to respond just to the proposal. On the buyer side, it can take a huge chunk of productive time, bidding on a major service may effectively crowd out several other important initiatives for the year. Knowing this, it’s important for both sides to assure that they are maximizing the efficiency of the process, achieving the optimum results and finding the best service provider for the long term.

While there is much more to running a successful supplier selection effort than can be covered in this short article, I am hopeful these five recommendations will go a long way toward helping the process go smoother and achieve better results.

Michael D. Ray
February 28, 2017

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