The Use of Tender Evaluation Information in Contract Management

We're delighted to feature a guest post from John Cole, Principal Consultant at QinetiQ Commerce Decisions. John has worked on complex procurement programmes and evaluations across many sectors, and this is a really interesting topic. It's not one I've really thought about too much, but he is right on the money as far as improving contract management goes.  (The Editor)

For some years now, it has always been a mystery to me why public sector buying organisations (and indeed many private sector firms too) generally keep procurement and contract management completely separated - almost like that distant cousin you have who you know exists somewhere, but you’ve got no idea what they are doing or where they are living, and would never dream of engaging in any form of conversation.

In my experience, too many organisations simply run a procurement exercise (often taking up many months of time, dozens of experts and days of meetings) and, at the end of the process, simply throw the winning tenderer’s details over the fence to contract management (with some form of draft contract and a note saying “Good Luck!!”). To be fair, there are some organisations out there who also throw over the person responsible for the procurement together with the tenderer details, contract and note, but very rarely does the information produced in the evaluation go with them or ever get used during the contract.

Evaluation criteria should be founded with the aims of describing the attributes of an ideal contractor and getting the tenderers to demonstrate how they can give you confidence that these attributes can be delivered. The criteria should be linked to the successful outcomes of the contract and, on the other side of the coin, should aim to identify and eliminate the key risks that may arise during the contract. Expressed in these terms, the evaluation should identify areas of confidence and concerns in a tenderer’s proposed submission. These areas should be closely linked to the fundamental delivery areas of contract management and even have involved contract management in the development of the criteria in the first place (here lies another problem for most organisations, but perhaps one for another blog).

Surely, at the very least, the low scoring areas of the successful tenderer’s submission should make it into the contract management risk schedule?  And, ideally, the findings of the evaluation should be an integral part of the contract manager’s toolkit. Whilst this might seem to be a ‘no-brainer’ for me and many people I speak with, it is sadly lacking in the majority of buying organisations.

Why? Probably for a number of reasons - protection of territories, lack of quality information, contract-centric performance management rather than true knowledge based performance management or perhaps simply that contract management weren’t involved in the evaluation process so have no real buy-in, knowledge or belief in the information within it (even if they did have it!!).

With the lack of information flow between procurement and contract management, it’s no wonder that the one time you can be sure that there will be communication between the two will be when contract management come knocking on the door (in the proverbial fence) after something goes wrong on the contract and the blame culture kicks in, along the lines of “Surely you people in procurement identified this risk during the evaluation?”

Well… even if they had identified it, and even if they had passed the information on, would the information have been used during the management of the contract? Sadly, most times, the answer is no.

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