Category Archives: Business

Why is PROBITY Important?

I have read with interest the Victorian Ombudsman’s report on the investigation into allegations of improper conduct by CenITex. Make sure you conduct your procurement activities mindful of PROBITY issues:

  • Make sure your evaluators are above reproach;
  • Document your evaluation approach clearly; and
  • Be prepared to defend your decisions if asked.

Why should I call for Tenders?

The process of calling for Tenders, Quotations, Expressions of Interest, or Requests for Information etc. is a recognised method of procuring contract goods and services.Typically, organisations will utilise the Tendering/Quotation process for a number of reasons.  Some of these may include:

  • Initiate a cost reduction program
  • Standardise product purchases
  • Reduce unplanned spending and drive down contract risk
  • Maintain auditable supply and contract management processes
  • Stimulate new product development with supplier innovations.

Mandatory vs. Optional Reqts

An RFP is a collection of requirements, and information the supplier may need to give a full response. It must make clear to suppliers what are requirements and what is simply information.
Requirements may be split between mandatory and optional requirements. Mandatory requirements are those that are essential to meeting the customer’s (your) needs, and suppliers who fail to meet mandatory requirements may be disqualified.  Optional requirements are often termed “nice to have but not essential”.  If in doubt about the importance of a requirement, classify it as optional.

A word on Pricing

We all know that pricing is important when purchasing anything …

However, you should always be very careful when determining evaluation criteria for the RFP, not to place too high a reliance on price.  Consider this …. you are buying equipment that will require ongoing support.  Often the lowest purchase price comes with expensive maintenance, and upgrades.  Also, you have to work with the vendors for the term of any support contract.  Good relationships with support providers are worth money … flexibility and approachability should NEVER be undervalued.