Purchasing and Procurement Processes Module Four Revision Date:

Purchasing and Procurement Processes Module Four Revision Date:

Purchasing and Procurement Processes Module Four Revision Date: 2/06/2015 1 Course Overview & Learning Objectives Course Expectations Training Approach & Participation Protocol COURSE INTRODUCTION 2 Mutual Respect General guidelines for online meetings: Interact Engage Participate WA Department of Enterprise Services

3 Training Credit To complete the module and receive credit, you will be expected to achieve a 80% on the module assessment . Employees should log into LMS to complete each module assessment. Use of the participant workbook is encouraged in the assessment! WA Department of Enterprise Services 4 Course Overview Course will be delivered in four modules: Module 1: Purchasing & Procurement Overview Module 2: Choosing a Route for Purchases of Goods and Procurement of Services Module 3: Competitive Procurements,

Amendments, and Exemptions Module 4: Purchasing & Procurement Processes WA Department of Enterprise Services 5 Module Overview Section One Section Two Section Three The Planning Process Solicitation and Selection

PostProcurement WA Department of Enterprise Services 6 Learning Objectives As a result of this training participants will be able to: Identify purchasing and procurement needs and outcomes Describe the importance of communicating need within the agency Identify scope, timeline, requirements and vendors as part of the planning process Discuss how to evaluate and select a vendor Apply the purchasing and procurement planning phases WA Department of Enterprise Services 7 Identify the Need and Outcomes

Communicate Need Within Agency Identify Scope, Timeline and Requirements Identify Vendors Define Scope and/or Statement of Work THE PLANNING PROCESS 8 Procurement Steps Planning Phase 1. Identify the Need and Outcomes 2. Communicate Need Within Agency 3. Identify Scope, Timeline and Requirements 4. Identify Vendors Post Procurement Solicitation & Selection

5. Define Scope and/or Statement of Work 6. Communicate Formal Need With Vendors 7. Evaluate Vendors 8. Select Vendor 9. Negotiate Contract 10. Contract Execution and Management WA Department of Enterprise Services 9 Collaboration and Planning Collaboration is important Work with Business Owners, Subject Matter Experts and Stakeholders WA Department of Enterprise Services 10 Identify the Need and Outcomes

Step 1 Why does your agency purchase goods and services? WA Department of Enterprise Services 11 Identify the Need and Outcomes Step 1 Critical Thinking & Outcomes of a Purchase or Procurement WA Department of Enterprise Services Identify Outcomes Identify Need Evaluate &

Analyze Identify Alternatives Available 12 Communicate Agency Need Step 2 1. Initiate planning process WA Department of Enterprise Services 2. Engage SMEs, business owner and other stakeholders

3. Conduct independent research 4. Determine checkpoints and delegated authority 13 Purchasing vs. Procurement Purchasing - the process of obtaining goods and services for the State of Washington. Procurement - the combined functions of identifying needs, initiating a procurement project, selecting a vendor, contracting with a vendor, purchasing of the goods or services, managing the resulting contract. WA Department of Enterprise Services

14 Identify Scope, Requirements and Timeline Step 3 Identify and define the scope and overall contract timeline WA Department of Enterprise Services 15 Identify Scope, Requirements and Timeline Step 3 Contract Purpose High-level Functional Areas

Contractor Responsibilities Contract Phases & Timeline What is NOT in Scope? WA Department of Enterprise Services 16 Identify Scope, Requirements and Timeline Step 3 Common Pitfalls in Scope of Work/Requirements Writing Too strict and rigid

Not enough details Written to a certain vendor or solution Outdated or obsolete requirements WA Department of Enterprise Services 17 Identify Vendors Step 4 WA Department of Enterprise Services 1. DES Vendor Lists 2. Knowledge of Vendor Marketplace 3. Vendor PreBid Communicatio

n 4. Other Sources 18 Define Scope and/or Statement of Work Step 5 Scope or Work vs. Statement of Work WA Department of Enterprise Services 19 Define Statement of Work Step 5 Requirements & Specifications Project

History & Objectives Performance Standards Reporting Requirements Statement of Work Deliverables Schedule WA Department of Enterprise Services Milestones 20 Communicate Formal Need With Vendors

Evaluate Vendors Select Vendor SOLICITATION AND SELECTION 21 Procurement Steps Planning Phase 1. Identify the Need and Outcomes 2. Communicate Need Within Agency 3. Identify Scope, Timeline and Requirements 4. Identify Vendors Post Procurement Solicitation & Selection 5. Define Scope and/or Statement of Work 6. Communicate Formal Need With Vendors

7. Evaluate Vendors 8. Select Vendor 9. Negotiate Contract 10. Contract Execution and Management WA Department of Enterprise Services 22 Communicate Formal Need to Vendors Step 6 Request For Quote /Quotation OR Qualifications (RFQ) Communicate Request For Proposal (RFP)/

Request for Bids (RFB) Request For Qualifications and Quotation (RFQQ) WA Department of Enterprise Services 23 Communicate Formal Need with Vendors Step 6 Solicitation Need RFQ RFQQ Standard, Ongoing Purchase

X X Many Vendors Offer This X X Cost is the Most Important Factor X Vendor Qualifications and Performance Important in Addition to Cost X RFP/RFB

X Vendor Specialization / Few Offer This X Complex Project Needs X Solution Required to Meet Need X WA Department of Enterprise Services 24 Communicate Formal Need with Vendors Step 6

Assign Procurement Coordinator Define list of potential vendors Encourage WEBS registration WA Department of Enterprise Services Draft Solicitation Content Requirements tailored to level of complexity Issue Solicitation Use WEBS Post Amendments on WEBS

Receive Bids Document date/time Maintain confidentiality 25 Communicate Formal Need with Vendors Step 6 Evaluate Costs / Rates Rank based on lowest cost or rate WA Department of Enterprise Services

Award Lowest cost, responsive bidder Post Results WEBS Notify successful & unsuccessful Bidders Negotiate & Award Contract Conduct Debriefings Negotiate & award the contract 26

Communicate Formal Need with Vendors Step 6 Select Team Establish Team Roles Write Specifications Identify RFP/RFB Coordinator for the project Score and rank Bids WA Department of Enterprise Services Draft RFP/RFB Content Project approach and methodology

Finalize Scope of Work Outcomes and Performance Measures Deliverables and milestones Management and staffing plan Bidder responses format Cost response format Finalize and Release RFP/RFB Stakeholders review draft RFP Finalize RFP for release

Post and publish RFP Post Release Activities Respond to Bidder questions Draft amendments or addendums Evaluation Process (Step 7) 27 Communicate Formal Need w/ Vendors - Cost Sheets Step 6 Vendor Name

Vendor Name Cost Time Deliverable A Materials Deliverable B Deliverable Cost Deliverable C Total: Total:

Vendor Name Hourly Rate Hours Total Staff level Total: WA Department of Enterprise Services 28 Evaluate Vendors Step 7 Evaluation Objectives

Provide clear direction and guidance Ensure integrity of fair evaluation process Create a documented process Recommend for contract award WA Department of Enterprise Services 29 Evaluate Vendors Step 7 Evaluation Step Considerations Confidentiality and Security Conflict of Interest

Evaluation Milestones Evaluator Availability? WA Department of Enterprise Services 30 Evaluate Vendors Step 7 Evaluation Roles include . Procurement Coordinator Ensure Adherence Prepare & Distribute WA Department of Enterprise Services Evaluation Committee Evaluate

Score Executive Sponsorship Supports & Authorizes Controls Expenditures 31 Evaluate Vendors Step 7 Phase 1 Initial Screening Phase 2 Evaluation of Technical and Management Response

Phase 3 Oral Presentations (if applicable) Phase 4 Evaluation of Cost Proposals Phase 5 Best and Final Offers (BAFO) Phase 6 WA Department of Enterprise Services Ranking of Proposals

32 Evaluate Vendors Step 7 Technical Evaluation Technical Evaluation Criteria 1 Executive Summary (75 points max) and Vendor Identifying Information (25 points Points (Weighted Score) 100 max) 2

3 Qualifications of Firm (300 points max) Approach to Scope of Work (300 points max) 300 300 4 Qualifications of Proposed Key Personnel (200 points max) 200 5 Corporate References (100 points max) 100

6 WA Department of Enterprise Services Total Weighted Score 1000 33 Evaluate Vendors Step 7 Cost Evaluations Vendor Name Cost Vendor A $150,000 Vendor B

$175,000 Vendor C $180,000 WA Department of Enterprise Services 34 Evaluate Vendors Step 7 Cost Evaluation Cost Component Supplies Vendor A Vendor B Vendor C

$50,000 $60,000 $70,000 Staff $50,000 $90,000 $90,000 Administrative Expenses $20,000 $5,000

$5,000 Profit/Overhead $30,000 $20,000 $15,000 Total $150,000 $175,000 $180,000 WA Department of Enterprise Services 35

Select Vendor Step 8 Once the evaluation is complete Award to Highest Scoring Bidder OR Reject all Bids or Re-Issue the Solicitation WA Department of Enterprise Services 36 Select Vendor Step 8 Once all bidders have been notified, conduct debriefings if requested. Following the award, as you get ready to negotiate and establish a contract make sure the solicitation files are complete. WA Department of Enterprise Services 37

Negotiate Contract Contract Execution and Management POST-PROCUREMENT 38 Procurement Steps Planning Phase 1. Identify the Need and Outcomes 2. Communicate Need Within Agency 3. Identify Scope, Timeline and Requirements 4. Identify Vendors Post Procurement Solicitation & Selection 5. Define Scope and/or Statement of Work

6. Communicate Formal Need With Vendors 7. Evaluate Vendors 8. Select Vendor 9. Negotiate Contract 10. Contract Execution and Management WA Department of Enterprise Services 39 Negotiate Contract Step 9 Conduct Baseline Contract Review WA Department of Enterprise Services Edit contract

based on proposal Finalize and Route for Signature s Contract Starts 40 Contract Execution and Management Transition Step 10 Contract Execution WA Department of Enterprise Services

Initial Kickoff Meeting Contract Management Framework Project Management 41 Contract Execution and Management Transition Step 10 Risk Mitigation Compliance with T&C Approve Contractor

Invoices Schedule Monitoring Ongoing Contract Management WA Department of Enterprise Services 42 Summary & Key Points Identified purchasing and procurement needs and outcomes Described the importance of communicating need within the agency Identified scope, requirements and timeline, and vendors as part of the planning process Discussed how to evaluate and select a vendor Applied the purchasing and procurement planning phases WA Department of Enterprise Services

43 Next Steps Complete test and achieve 80% or higher Complete evaluation form WA Department of Enterprise Services 44 Questions after the training? Call Cheryl Shaw at (360) 407-9376. QUESTIONS 45

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