The Competitive Dialogue Procedure 2 Years On
09 September 2008
This article was first published in Supply Management on 17
July 2008.
“No battle plan ever survives contact
with the enemy” - usually attributed to Field Marshall Helmuth
Carl Bernard von Moltke.
The Competitive Dialogue procedure was
implemented in 2006 with limited guidance. The procedure has
had mixed success as customers and suppliers tried to align
internal policies and procedures with the new process. The
learning from this period has been collated into new guidance (3rd
June) by the OGC entitled “Competitive Dialogue 2008” (the
Guidance).
The Guidance is a must for procurement
professionals. This is not just because it is genuinely
useful but also as it will undoubtedly be quoted verbatim during
dialogue sessions as a negotiation lever.
The Guidance breaks down the Competitive
Dialogue procedure into seven processes and comments in detail,
including:
- conduct early planning – assess the required
number of bidders, stages and down selections. Choosing the
right moment for a rapid down select is vital to maintain sensible
resource allocations
- budget realistically – unfortunately the
Competitive Dialogue is proving more expensive to run than even the
negotiated procedure
- undertake due diligence – establish whether
Competitive Dialogue is the right procedure at all. Do not
automatically discount the restricted and negotiated
procedures
- draft the contract notice – if you are going
to spend significant time on anything, make it this. Due to
the flexibility of the dialogue process, it is easy for solutions
to stray outside the boundary of the contract notice potentially
meaning a customer cannot legitimately buy things it identifies
during dialogue
- organise the team – the flexible nature
of dialogue means that there is often a need for rapid technical
decision making. Therefore consider developing a separate
dialogue team that escalates issues appropriately
- select the right personnel – second and
recruit the right mix of skills but make sure that they are
suitably trained in the way that your organisation wants to run the
process
- recognise sector drivers – each procurement
will have unique sector differences, reflecting the dynamics of
different supply chains, and these must be planned for
Further guidance will be forthcoming, but in
the interim some key additional points are worth noting:
- design the integration activity – ultimately,
all the discussions, working papers, issue logs and documents from
all the different streams need to be reduced to a written contract,
and this must be planned and controlled and not left to a final
rush
- stream line the process with effective tools –
after false starts, some procurements are obtaining significant
benefits from the early and effective introduction of proven tool
sets (e.g. common style guides, precedents, e-communication,
e-dealing rooms, e-evaluation tools and document analysis
tools)
- design and implement the evaluation criteria –
the high level criteria, published in either the contract notice or
subsequent documentation, must be decomposed into a detailed model,
aligned with the bidder’s tender and capable of weighting, scoring
and normalising. This is complex and the most frequent area
of challenge by disgruntled bidders
The Guidance concludes that there are real benefits from
Competitive Dialogue, driving improved value by maintaining
competitive tension, and enabling the bidders to submit their final
tender with greater confidence. Maybe now the plan will
survive contact with the enemy a little longer.
For further information, please contact Andrew Lucas or Andrew Withers.