Expertise Project Delivery
A Best Value Approach
A recent article in the Engineering News Record, exposed the growing pains that have developed as prequalification procurement tools are transitioning to digital formats.
“New third-party prequalification tools have brought fresh frustrations related to fairness and cost, say bidders…
“With new electronic prequalification platforms, and more outsourcing of an essential risk-management process, have come fresh issues that displease some bidders. They include fairness, the work and cost of submitting information to different platforms, and the ability to communicate with a real person when a third-party’s platform collects the information.” More Project Gates Are Electronic, ENR, (August 19/26, 2019)
The ENR article goes on to describe how disgruntled industry management is becoming with prequalification.
“Rich Mannarino, estimating Vice President for Saxonburg, Pa.-based Brayman Construction Corp., a heavy civil and geotechnical Contractor, said his company relies on surety bonds to solicit bids from subs on larger projects. Otherwise, Brayman doesn’t rely on prequalification platforms to check bidders…
“Subcontractors have similar grumbling. Richard Bright, chief operating officer of the American Subcontractors Association, says his members want to embrace new technology, but the evolution of many different prequalification platforms, and the fee required to enter information into some of them, are problematic.”
As the construction industry labors through the inevitable growing pains of pre-qualification’s technological transition to digital platforms it is important that management not lose sight of the indispensable nature of the prequalification process itself.
Expertise Project Delivery
The Simplar Institute’s Expertise Project Delivery (XPD)is a best-value approach that has been developed and refined over the past 20 years and utilized on over $126 Billion in projects and services with proven results of increasing the probability of hiring the highest performing vendors.
XPD focuses on three key elements:
- Key Personnel– Research has found that successful projects and services have a common theme – the expertise and quality of the individuals actually performing the tasks.
- Anonymous Proposals – Many vendors believe that owners have ‘favorite’ vendors, and that the award will be made to the same firm(s) that have consistently won in the past. This perception (whether real or not) impacts the number of vendors that propose, the quality of vendors that propose, and the quality of the proposals themselves. XPD requires all proposals to be anonymous.
- Limited Pages– In many digital prequalification platforms, proposals can be 50- 100 pages long, resulting in contractors resisting filling out the forms because the process is too time consuming and costly. In the XPD approach, the proposals are limited to 2-5 pages that narrow the criteria The Simplar Institute’s Expertise Project Delivery (XPD) protocol has streamlined prequalification criteria to include vendor proposals that (1) precisely identify their project-specific capability, (2) identify and prioritize key project risks and associated solution strategies, and (3) assess any value-added options that are offered. Period.
Pre-Award Planning and Clarification
Once our prequalification process narrows the field, remaining vendor enter the pre-award and clarification phase. The Pre-Award Planning and Clarification process provides owners with greater comfort and clarity around what exactly they are buying. Research reveals that the Pre-Award Planning and Clarification process:
- Reduces schedule delays by 10 -70%
- Reduces cost increases by 20% – 70%
- Increases owner satisfaction by 30% – 80%
The XPD approach focuses primarily on selection. No changes or modifications are ever required to the standard contract that the owner has utilized in the past.
Keeping Our Eye on The Ball
As the construction industry struggles with the inevitable transition of prequalification to digital platforms, we would like to caution senior management to resist throwing out the baby with the bathwater. Rather, continue to develop in-house prequalification expertise while the digital platforms complete the evolution of their business model. Together, over time, our industry can refine best-value procurement into a highly efficient, productive, and indispensable part of the procurement process.