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The Art of the Deal : Tendering and Outsourcing

Implementing effective outsourcing contracts is key to successful asset management, both for client and service provider. Outsourcing projects has shown that spending more time initially structuring the contracts and defining responsibilities clearly, pays dividends in the medium to long term. For many organizations, the tendering and contract renewal process is not a core function with a dedicated team that exists. Going to market for new products or services, or better prices involve a lot more than some bullet points specifications in your documentation.

Decide with your priorities

However, until and unless you don’t have proper and efficient resources to plan a perfect bid or you simply don’t want to indulge this process and want to outsource it howsoever, it is advisable to make tendering an in-house process which will save you both time and money. We have mentioned some important aspects to be considered while making a deal so that you can come up with a perfect and must-win tender.

Evaluation of Bids

Depending too much on your old evaluation model every time will not give you the desired result. The evaluation process must include an eagle-eye inspection considering not only the choice of contractor based on price but emphasis should also be laid on various other practices involved in this process. Pre-qualification involves evaluating various aspects of the bidding company’s performance. A pre-qualified contractor must be capable of carrying out the planned project as the client wishes. Verification of the minimum requirements must appropriately meet your KPI. The client begins by deciding which parameters will be included in the model. After this is established, how the parameters are to be evaluated must be defined.

Remuneration Model

The unbroken continuing development of outsourcing services includes not only the services themselves, but also the entire associated management tools. In addition to the contractual definition of the service as well as various control instruments, the remuneration model plays an important role in order to optimize both the outsourced service, as well as the overall performance of the outsourcing company itself. Despite your old remuneration model, a clear customer-contractor relationship exists on the basis of negotiated agreements between outsourcer and service provider, it is self-evident to make use of the basic ideas such as price, transaction billing, service level, share-in savings etc.

Scope of Work

Filling old scope of work every time you go for a tender doesn’t work always. The nature of the scope of work can vary significantly from project to project. Sometimes it will simply offer a very broad description of the works required, whilst sometimes it provides a complete description of the project, significant milestones, a program of work with the expected timeframes for delivery, reports, pricing, deliverables, roles and responsibilities and end products that are to be provided. Hence, every time you look for a tender, the scope of work should clearly elaborate all such aspects.

Working on these three basic but crucial aspects of bidding will allow you to approach with a new and enhanced framework for every bid which will surely bring a variety and distinction in your tenders.

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