Quality trade-off is an invalid concern when conducted correctly.ġ2 Success Criteria Auctions are typically one step within a more rigorous strategic sourcing process. Request for Proposal (RFP): Complex proposal required beyond simply quantity/price Segmented requirements weighted scorecards Give us a price, implementation plan, defined milestones and deliverables, contract requirementsġ1 Reverse Auctions: Like ebay, but in reverse When market conditions and buyer requirements are right, a reverse auction can be used to negotiate additional cost savings from an initial quote or proposal. Request for Quote (RFQ): Simple quantity/price specification Can be a preliminary step to a reverse auction Give us a price for X units of Y product/service. 9 $100M where does it go? Estimated unidentified/unclassified spend ~$20M(?) Facts: 8 suppliers make up 50% of total spend 45 suppliers make up 80% of total spend 512 known IT suppliersġ0 RFx: Request For? RFI, RFQ, or RFP? Does it matter? Each RFx type solicits different information from a supplier Rules of Engagement vary, depending on the activity being conducted Request for Information (RFI): 1-way request for information No customer requirements are provided Helps to incite competition, and used to inform subsequent sourcing processes (i.e., RFP) Tell us about your company and product/service, how it s sold, and who your competitors are.
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