1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in...

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1 Best Value Business Model Best Value Business Model www.pbsrg.com

Transcript of 1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in...

Page 1: 1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in 1994 to assist clients in improving the.

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Best Value Business ModelBest Value Business Model

www.pbsrg.com

Page 2: 1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in 1994 to assist clients in improving the.

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Who we are: PBSRG OverviewWho we are: PBSRG Overview

Established in 1994 to assist clients in improving the quality of construction.

Research has grown into: Information Measurement Theory (IMT): measuring of current conditions to

predict future outcomes Clients implementation of Best-Value Performance Information Procurement

System (PIPS) Organizational Transformation Models New project management model (alignment/leadership instead of

management/influence) PIRMS New best value model New information environment (minimize access and flow of information) Testing of concepts outside of construction Risk management by using deductive logic, minimization of decision making

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Worldwide as a leader in Best-Value Systems Conducting research since 1994 168 Publications 800+ Projects $4.6 Billion Services & Construction 5% Increase in Vendor profit 98% On-time, On-Budget, Customer satisfaction PMI, NIGP, IFMA, IPMA Tests in Netherlands, Botswana/Africa, Malaysia ASU – investments of over $100M due to BV

PBSRG’s Research Results(Performance Based Studies Research Group)

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Research ClientsResearch Clients General Dynamics University of Minnesota General Services Administration (GSA) US Solar Heijmans, Netherlands Ministry of Transportation, Netherlands State of Alaska University of Alberta State of Oklahoma State of Idaho Idaho Transportation Department State of Oregon Arizona Parks and Recreation US Army Medical Command USAF Logistics Command University of New Mexico University of Idaho EVIT School District

Arizona State University US Corps of Engineers Arizona Public Service (APS) Salt River Project (SRP) Rochester Utility Boise State University Idaho State Lewis & Clark City of Phoenix, AZ City of Peoria, AZ City of Roseville, MN Olmstead County, MN Fann Environmental Brunsfield Fulbright Program /University of Botswana, Africa US Embassy, Bank of Botswana RMIT, Melbourne Australia Aramark, Canon, Qwest, ISP, HP, Chartwells, AP,

Pearson Various Contractors and Consultants

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Working Commission 117 & JournalWorking Commission 117 & JournalInternational Efforts & PartnersInternational Efforts & Partners

5 years15 tests for infrastructureTwo major GCs

Fulbright ScholarUniversity of BotswanaPIPS tests RMIT

Teaching IMTPBSRG platform

Tongji University

BrunsfieldComplete Supply Chain

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A little theory of thought…A little theory of thought…

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Rules of this DiscussionRules of this Discussion This is a deductive presentation

Don’t take anything personal!!!

Recommend that you minimize decision making (if you don’t know, use the deductive logic)

Type A and Type C will be discussed. Neither is better than the other. Both are required. Both are just as important as the other.

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Information Measurement TheoryInformation Measurement Theory

IMT Definition: Measurement of information to predict future outcomes

IMT Objectives: To minimize the need for decision making To understand why things happen To be able to predict future conditions To minimize the need for data To optimize results

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LAWSLAWSThe Number of Laws of PhysicsThe Number of Laws of Physics

= =

Laws are not created…they are discovered

100% Laws

PAST

100% Laws

PRESENT

100% Laws

FUTURE

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Initial conditions

Final conditions

An EventAn Event

Time

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Initial conditions

Final conditions

Proposal: Proposal: The Event Can Only Happen One WayThe Event Can Only Happen One Way

Time

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Deductive LogicDeductive Logic No event has had two outcomes

All event outcomes can be predicted with “all information” (initial conditions/laws)

The more information we have before the event, the easier it becomes to predict the final outcome.

The lack of information that an individual has, will never change the final outcome (it will just prevent that individual from predicting the outcome).

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Things caused by a lack of information Believe in chance

Expectations

Believe in control

Makes decisions

Directs others

Influences others

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Perceive

Process

Apply

Change

Cycle of LearningCycle of Learning

100%Information

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Perceive

Process

Apply

Change

Learning SpeedsLearning SpeedsAll Individuals Learn At Different SpeedsAll Individuals Learn At Different Speeds

100%Information

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More “perceptive” perceive ata faster rate, change at a fasterrate, and are more accurate with their predictions.

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All individuals and organizations have a level of perception that allows them to predict “some” future outcomes.

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““Types” of IndividualsTypes” of Individuals

Perceive

Pro

cess

Apply

Ch

an

ge

100%100%InformationInformation

Perc

ep

tion

of

Info

rmati

on

Time

A

C

0%

100%

B

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To Understand the “A” and the “C” To Understand the “A” and the “C” Simplify the Rate of Change ModelSimplify the Rate of Change Model

A simple model is easy to understand

Simplicity is when things look very different

Eliminate all areas where things look alike (needs too much decision making)

Extremes minimize the decision making

Perc

ep

tion

of

Info

rmati

on

Time

A

C

0%

100%

B1

B2

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Perc

ep

tion o

f In

form

ati

on

Time

A

Simplicity: Who perceives more Simplicity: Who perceives more information?information?

C

0%

100%

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Time

Info

rmati

on

Level

0%

100%

A

C

Type “A” Individual vs. Type Type “A” Individual vs. Type “C” Individual“C” Individual

Aligns resourcesAligns resources Makes decisionsMakes decisions Flows more informationFlows more information InfluencesInfluences Wants a favorWants a favor Doesn’t documentDoesn’t document PreplansPreplans Shifts blame to othersShifts blame to others Likes to make decisionsLikes to make decisions Does not prioritizeDoes not prioritize Uses five words for every one Uses five words for every one

neededneeded

C

A

C

C

C

C

C

C

C

C

A

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Time

Info

rmati

on

Level

0%

100%

A

C

Type “A” Individual vs. Type Type “A” Individual vs. Type “C” Individual“C” Individual

Aligns resourcesAligns resources Very detailed workVery detailed work Proud of technical skillsProud of technical skills Is more expensiveIs more expensive Wants consensusWants consensus Likes doing totally new thingsLikes doing totally new things Does things they understandDoes things they understand Requests detailsRequests details Traditional practicesTraditional practices Thinks other people act differentlyThinks other people act differently Believes experts have riskBelieves experts have risk

C

A

C

C

C

C

C

C

C

C

A

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Time

Info

rmati

on

Level

0%

100%

A

C

Type “A” Entity vs. Type “C” Type “A” Entity vs. Type “C” EntityEntity

Knows who to work with Knows who to work with Implements leadership trainingImplements leadership training Measurement of performanceMeasurement of performance Uses dominant informationUses dominant information MeasuresMeasures Has a conservative planHas a conservative plan Constantly changes their mindConstantly changes their mind Use relationshipsUse relationships

C

A

C

C

A

A

A

A

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RSRS

LSLS

Time

Info

rmati

on

Level

0%

100%

AA

CC

How to Create a KSM How to Create a KSM Left Side (LS) (Type A) vs. Right Side (RS) (Type C)Left Side (LS) (Type A) vs. Right Side (RS) (Type C)

+ =

RSRS

LSLS

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Time

Info

rmati

on

Level

0%

100%

A

C

Where is Control?Where is Control?

No

In

form

atio

n

Info

rmat

ion

LS RS

No

Co

ntr

ol

Co

ntr

ol

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Time

Info

rmati

on

Level

0%

100%

A

C

Where is Management?Where is Management?

No

In

form

atio

n

Info

rmat

ion

No

Co

ntr

ol

Co

ntr

ol

LS RS RS

Lea

de

rsh

ip

Man

ag

emen

t

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Time

Info

rmati

on

Level

0%

100%

A

C

Decision Making?Decision Making?

No

In

form

atio

n

Info

rmat

ion

No

Co

ntr

ol

Co

ntr

ol

LS RS

Lea

de

rsh

ip

Man

ag

emen

t

RS

No

De

cisi

on

Mak

ing

RS

Dec

isio

n M

akin

g

Co

ntr

ol

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Plot the Following Plot the Following CharacteristicsCharacteristics

Leadership Alignment Efficiency Change the behavior of others Believe in chance Emotion Becomes the expert in the organization Technical Continuous Improvement Freedom Believes in range/diversity Proactive

LSLS

LSLS

LSLS

RSRS

RSRS

RSRS

RSRS

RSRS

LSLS

LSLS

LSLS

LSLS

LS

RS

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Plot the Following Plot the Following CharacteristicsCharacteristics

LS

RS

Logical Overview/Process Details Focuses “why” Focuses “what” Measures Performance Accountable Reactive Telescope “in and out” “What if” Maximize information flow Loves meetings

LSLS

LSLS

RSRS

LSLS

RSRS

LSLS

LSLS

RSRS

LSLS

RSRS

RSRS

RSRS

Page 30: 1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in 1994 to assist clients in improving the.

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Plot the Following Plot the Following CharacteristicsCharacteristics

LS

RS

Does not believe in being controlled Captain of their own ship Can change others “Source of Light” or wisdom to influence all “Mirror” so others can see themselves Can influence anyone Believe in randomness No control over their destiny Feels controlled More activity Incentives Looks inside to improve environment Has a more conducive environment to change

LSLS

LSLS

RSRS

RSRS

LSLS

RSRS

RSRS

RSRS

RSRS

RSRS

RSRS

LSLS

LSLS

Page 31: 1 Best Value Business Model . W W W. P B S R G. C O M 2 Who we are: PBSRG Overview Established in 1994 to assist clients in improving the.

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ConclusionsConclusions

The environment is the person

All characteristics can be related to the amount of information

By using extreme values, deductive logic can be used

Type A characteristics are related

To move to a Type A environment, we must minimize Type C characteristics

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QuestionsQuestions Is there anything that happens that is not predictable?

Does anything happen by chance (was not predictable if all the information was known)?

Who is more important to the event, the A or the C?

Is there a random event that has been identified by science?

Why do people like complexity?

Who makes more decisions?

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So What is the Big Picture?So What is the Big Picture?

Where are we going with Where are we going with this?this?

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Perceive

Process

Apply

Change

Cycle of LearningCycle of Learning

100%Information

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Q: When do we know 50% of what Q: When do we know 50% of what we will ever know?we will ever know?

0% Information 100% Information

Life Span

50% Information? 50% Information?50% Information?

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Proposal: When we are almost dead.Proposal: When we are almost dead.

0% Information

100% Information(what we will know)

50% Information

Life Span

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Q: How much do we know about Q: How much do we know about everything?everything?

0% Information 100% Information

% Known

This Much? This Much?This Much?

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Proposal: We don’t know very muchProposal: We don’t know very much

0% Information 100% Information

% of Information

What we don’t know

Wh

at w

e k

now

As for me, all I know is that I know nothing.

- Socrates

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Q: How do we solve what we don’t Q: How do we solve what we don’t know? (aka Risk)know? (aka Risk) Do we use what we know to solve what we don’t know?

OR Do we use logic to solve what we don’t know?

0% Information 100% Information

% of Information

What we don’t know

Wh

at w

e k

now

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A: Logic can be applied without A: Logic can be applied without knowledge/experienceknowledge/experience

0% Information 100% Information

% of Information

What we don’t know

Log

ic

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What is the model?What is the model?Identify the expert with as little effort as possible, using

measurement and differentialTransfer risk and control to the expert through preplanning

and risk minimization, focusing on risk that are not controlledHire the expertUse alignment, planning, & measurement in place of

management, control, and directionCreate a performance information environment to drive

accountability and changeProactive vs. Reactive Supply chain (us mentality)Logic vs. ExperiencePredictable vs. Chance

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Industry Performance and CapabilityIndustry Performance and Capability

Highly Trained

MediumTrained

Vendor XCustomers

OutsourcingOwner

PartneringOwner

PriceBased

MinimalExperience

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Initial conditions

Final conditions

An Event

Time

Laws Laws

Risk is deviation fromexpected measurements

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Initial conditions

Final conditions

Traditional Management

Time

Laws Laws

D2

D1 M&C

D3

D1: Client makes decisions on budget, time, and expectation

D2: Client consultant/professional makes more decisions to make expectations true

D3: Vendors attempt to use the lowest possible price to minimize the risk caused by the decision making of client & consultant/professional

M&C: The client attempts to force vendor to make expectations happen

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Initial conditions

Final conditions

New PM and RM Model that Depends on Efficiency

Time

Laws Laws

M1

D1 M3

M2

M1: Measured designed option that more accurately describe the initial conditions replaces D1

M2: The best value vendor that replaces the client/professional design M1

M3: WRR/RMP measures deviation

M4: Final performance measurement

M4

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Inefficiency vs EfficiencyInefficiency vs Efficiency

Micro-Management Performance dictated by technical

information Specification is the requirement Inspection by client Client’s professional is the expert and has

control No performance measurements Increase flow of information Relationships (partnering, deals, give and

take) used to solve issues Need more people (inefficient) No accountability

Leadership Performance dictated by performance

information Specification is only the intent

Quality control by contractor Vendor has control Performance measurements Decrease flow of information High performance vendors used to

minimize risk Need less people (efficient) Accountability

Can you make the transition?

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Performance-Based Performance-Based FunctionsFunctions

I. Price-Based

II. Performance-Based

IV. Unstable Market

III. Negotiated

Competition

Pe

rfo

rman

ce

Low High

High

Treat as a Commodity Volume Based No Accountability Finger Pointing Management & Inspection Minimum Standards Client minimizes risk

Value & Performance Maximize Profit Vendor Accountability Minimized Management & Inspection Quality Control Vendor minimizes risk

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Best Value OverviewBest Value Overview Complete business model for organizations & projects

A best value selection and management tool (developed and tested over 16 years)

It can be applied to any type of system, organization, structure, procurement, project, or need

Best Value is not just a procurement method. It is a selection and management tool that can be applied in: Business Services (IT, dining, consultants, equipment, doc mgmt, insurance, etc.) Facility Services (maintenance, roofing, janitorial, landscaping, supplies, etc.) Design, bid, build (DBB), Design build (DB), Construction manager at risk (CMAR) A/E & Design, Job Order Contracting (JOC), Indefinite Delivery Indefinite Quantity

BV is not a computer software package, but rather a combination of IMT principles that allows a client to make an informed decision

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What does the Best Value Model do?What does the Best Value Model do?

Makes things simple (measurement, dominant information)

Minimizes the fuel of bureaucracy (decision making, non-dominant information, management, control, and direction)

Creates transparency

Allows organizations/vendors to be highly efficient and successful

Proposes that to accurately identify what “is” and then to have a plan to efficiently meet the needs will minimize risk

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Silo Buster – Make Things SimpleSilo Buster – Make Things SimpleP

lann

ing

/ Pro

gram

min

g

Des

igne

r/E

ngin

eerin

g

Con

trac

ting

Con

trac

tors

/ M

anuf

actu

rers

Use

rs

Insp

ecto

rs

Sim

plic

ity/D

omin

ant

Info

rmat

ion

Technical Details

30K Foot Level

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Best Value System: Best Value System: PIPS & PIRMSPIPS & PIRMS

Identification of PotentialBest-Value

Pre Planningand

Risk Management

Measurement ofDeviation from the

Expectation

PHASE 1PHASE 1 PHASE 2PHASE 2 PHASE 3PHASE 3

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PIPS PIRMSPerformance Information

Procurement SystemPerformance Information Risk Management System

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Filter 1Past

PerformanceInformation

Filter 2Proposal & RAVA Plan

Filter 4Prioritization

(Identify Best Value)

Filter 5Pre-Planning

Phase

Filter 6Weekly

Report &Post-Rating

Time

Qua

lity

of V

endo

rs

Filter 3Interview

Key Personnel

Awar

d

High

Low

BV ProcessBV Process

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Filter 1Past

PerformanceInformation

Filter 2Proposal & RAVA Plan

Filter 4Prioritization

(Identify Best Value)

Filter 5Pre-Planning

Phase

Filter 6Weekly

Report &Post-Rating

Time

Qua

lity

of V

endo

rs

Filter 3Interview

Key Personnel

Awar

d

High

Low

Getting Started:Getting Started:Developing a BV RequirementDeveloping a BV Requirement

Setup Phase

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Touching Base….Touching Base….Remember, goal of doing something different is to be better

than you are right now

Which means you have to change….

And people don’t like to change….

So before implementing anything new in your organization let’s think through what we should do…

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Key Factors Before Key Factors Before Implementing PIPSImplementing PIPS Most organizations are slow to change

(Type C), and most individuals in these organizations are slow to change (Type C). Therefore, you cannot force the entity to change overnight.

Change must be slow.

Implement BV (or any new system) as a pilot test.

Do not educate the entire organization on the PIRMS process. Keep it under the radar so everyone feels comfortable.

The process must create a win-win. TimeIn

form

ati

on

Level

0%

100%

A

C

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Critical Factors of SuccessCritical Factors of Success Setup Phase

Identify core group Identify strategic plan / goals Identify and measure current level of performance Prepare critical documents / process

Testing Phase Implement BV on pilot projects or groups

Documentation and Modification Phase Analyze implementation Make modifications based on proper concepts and principles Educate

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The Core GroupThe Core Group The Core Group is a small group of individuals that will handle all functions

of the Pilot Program. Core group is vital to long-term success.

Core group must be carefully selected based on proper characteristics

Core Group might include: Upper Management (Boss) Business Analyst Project Manager Procurement Officer Subject Area: IT, Facilities / Engineering, etc.

Core Group must be heavily educated on concepts. That is they need to understand the “why” not just the “what”

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Identifying Current Level of Identifying Current Level of PerformancePerformance A client should identify their current level of performance (to use as a

comparison).

For example Total size ($) Performance of incumbent (OT, OB, 1-10) Original proposal vs actual & current results Number of projects procured per year Average change order rate Average project delay or number of issues Overall customer satisfaction

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Establish The Strategic Establish The Strategic PlanPlan

Strategic

Plan

There are two main categories of activities that may jeopardize the sustainability of a best-value organizational transformation. These areas are performance risk and political risk.

Performance risk is the risk of the vendor not completing the project within the financial projections, performance requirements, or to the satisfaction of the user. This risk can be mitigated by implementing the Best-Value selection process and the weekly risk report.

Political risk includes resistance from both internal and external parties, including; business services & procurement personnel, upper management, project management, and the vendors. Political risk is more difficult to minimize and will take the greatest amount of effort.

To minimize political risk, a long-term strategic plan must be established which outlines how the user will get to where they want to go.

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The Strategic PlanThe Strategic PlanStrategic

Plan

A strategic plan is essential to the long-term success of a best-value program.

The strategic plan must be established before beginning a pilot program and should be documented in writing.

By having the strategic plan in writing, all decisions can be minimized by simply following the outline of the plan.

The majority of users have not established strategic plans.

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Contents of the Strategic Contents of the Strategic PlanPlan Client must establish goals (short term / long term).

Potential goals/metrics may include: Increase vendor performance (OT, OB) Reduction in change orders Increase customer satisfaction Increasing (or maintaining) current level of competition Reducing the amount of management time Reducing procurement time Minimize any litigation Increase efficiency of project managers

Education/Implementation strategy (w/ risks & plans)

Schedule

Strategic

Plan

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All Research Must Relate All Research Must Relate Back To The Strategic PlanBack To The Strategic Plan No meetings / decisions should be set without establishing the strategic

plan / goals of the research.

Any decisions that must be made must have an impact to the strategic plan. Meetings to have Who to educate Pilot projects to select Speed of implementation

Strategic

Plan

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Duties of Core GroupDuties of Core Group Be educated Educate others (inside and outside your organization) Maintain and enhance the strategic plan Ensure there is a maintained weekly report for the whole effort

Ensure there is a maintained WRR for each project effort as soon as it starts

Maintain the directors report Maintain an up to date case study at all times Be able to show the value of the Best Value effort at all times

DR, WRR, Case Study, others Integrate with other clients and users Help ensure the vendors’ success

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RFP ObstaclesRFP Obstacles In most cases, BV can be incorporated into any user/client with very little

modification.

However, experience has shown that the resistance of individuals are the greatest obstacle to creating change. The most common statements are: “This is not the way we normally do it...” “I recommended that you change the process to do this...” “It makes more sense to do it this way...” “I don’t think this is legal...” “Let me play devil’s advocate…”

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Should We Issue A Should We Issue A Budget?Budget?The owner wants the best-available option that meets the

requirements.

Requirements are: Time constraints Cost constraints Quality

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Minimizing Budget RiskMinimizing Budget Risk“To Share” or “Not to Share” – the Budget

If “To Share” Risk: If cheaper than budgeted – vendors will come up to

the budget Risk: If more expensive than budgeted – vendors will come

down and look to change orders for margin Advantage: Gives high performers the edge in identifying it

as a risk – offer solutions (differentiation) Reality: Still have price competition& cost reasonableness

so budget knowledge only helps high performers and puts low performers at a disadvantage

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Minimizing Budget RiskMinimizing Budget RiskIf “To Not Share”

Risk: Estimates can be too high, with no offerings of risk minimization

Risk: If one very low bidder, can cause confusion in BV selection

Advantages: Don’t worry about price gouging (but so few bidders now days)

Reality: Helps non-performers be more competitive

Conclusion Greater risk in not giving the budget than giving it No real risk in giving the budget – only perceived risk

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Low PerformerLow Performer

Can a low-performer ever give you high performance? “No, by definition, they are a low

performer.”

How does a low-performer increase their competitiveness? “Since they can’t change their

current level of performance, they must be the best at....$$$$”

Contractor 1

Contractor 2

Contractor 3

Contractor 4

Perf

orm

an

ce

High

Low

Ris

k

High

Low

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Impact of No Budget

Contractor 1

Contractor 2

Contractor 3

Contractor 4

Perf

orm

an

ce

High

Low

Ris

k

High

Low

Contractor 1Contractor 2Contractor 3

Pri

ce

High

Low

Contractor 4

Giving out your budget has no impact to a low-performer

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PIPS Best Value SystemPIPS Best Value System

Identification of PotentialBest-Value

Pre Planningand

Risk Management

Measurement ofDeviation from the

Expectation

PHASE 1PHASE 1 PHASE 2PHASE 2 PHASE 3PHASE 3

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Go to PA 1-3Go to PA 1-3

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Filter 1Past

PerformanceInformation

Filter 2Current Project

Information

Filter 4Identify Potential

Best Value

Filter 5Pre-Award

Phase

Filter 6Weekly

Report &Post-

Rating

Time

Qualit

y o

f V

endors

Filter 3Interview

Aw

ard

High

Low

AwardAward

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Filter 1Past

PerformanceInformation

Filter 2Current Project

Information

Filter 4Identify Potential

Best Value

Filter 5Pre-Award

Phase

Filter 6Weekly

Report &Post-

Rating

Time

Qualit

y o

f V

endors

Filter 3Interview

Aw

ard

High

Low

Filter 6 – Weekly Risk ReportFilter 6 – Weekly Risk Report

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Weekly Reporting SystemWeekly Reporting System Excel Spreadsheet that tracks only unforeseen risks on a project

Client will setup and send to vendor once Award/NTP issued

Vendor must submit the report every week (Friday).

The final project rating will be impacted by the accuracy and timely submittal of the WRS

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Unforeseen Risks

PERFORMANCE SUMMARY• Vendor Performance• Client Performance• Individual Performance• Project Performance

RISK MANAGEMENT PLAN• Risk• Risk Minimization• Schedule

WEEKLY REPORT• Risk• Unforeseen Risks

Management by Risk Management by Risk MinimizationMinimization

METRICS• Time linked• Financial• Operational/Client Satisfac.• Environmental

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Overview of SHIP Test Overview of SHIP Test ObjectivesObjectives Establish contract with SHIP provider for college students in Idaho

BSU Objectives: Maximize value (performance and cost) of SHIP Have an environment of risk minimization and performance

measurement Minimize client effort in selection and management Minimize decision making Education of PIPS Measurement of differential

BSU would like to create a “consortium” of universities/colleges in Idaho for a single SHIP contract

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DeliverablesDeliverables Major project deliverables include:

1. Set and Educate Project core team and2. Set BSU Strategic Plan3. Capture current level of performance and cost

Plan providers Cost structure Program structure and details Identify differentials, gaps, and overlaps

4. Create RFP5. Educate Vendors6. Run Selection and Interviews7. Run Pre-Planning and Risk Management8. Award & Transition9. Establish and maintain measurement system

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o

OverviewOverview Create a statewide Student Health Insurance Plan (SHIP) consortium Create a statewide Student Health Insurance Plan (SHIP) consortium

Boise State University (BSU)Boise State University (BSU) Idaho State University (ISU)Idaho State University (ISU) Lewis-Clark State College (LCSC)Lewis-Clark State College (LCSC)

3-Year Contract | $36 Million3-Year Contract | $36 Million

Measurements of SuccessMeasurements of Success1.1. Reduce internal University program administration costsReduce internal University program administration costs2.2. Maintain or increase Customer Satisfaction (University & Students)Maintain or increase Customer Satisfaction (University & Students)3.3. Maintain or increase cost-effectiveness of program to studentsMaintain or increase cost-effectiveness of program to students

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What Should We Include In What Should We Include In RFP?RFP? Request For Information (RFI)

General request to vendors Ask vendors what information they need to see in the RFP to create

and provide an accurate proposal Has no contractual implications, just providing information to the

client

Filter 1Past

PerformanceInformation

Filter 2Proposal & RAVA Plan

Filter 4Prioritize (Identify

Best Value)

Filter 5Pre-Award

Phase (Pre-Plan)

Filter 6Weekly

Report &Post-Rating

Time

Qua

lity

of V

endo

rs

Filter 3Interview

High

Low

RFI RFP

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Selection Criteria & WeightsSelection Criteria & Weights Responding contractors were evaluated on:Responding contractors were evaluated on:

Premiums (Student, Spouse, Dependents) Premiums (Student, Spouse, Dependents) (200 Points)(200 Points)

Interviews Interviews (350 Points)(350 Points) Program Administrator Program Administrator Claims Administrator Claims Administrator Waiver Administrator Waiver Administrator Data Base Manager Data Base Manager Marketing Manager Marketing Manager

Risk Assessment and Value Added (RAVA) plan Risk Assessment and Value Added (RAVA) plan (250 Points)(250 Points) Risk Assessment – ability to identify and minimize potential risk unique to this projectRisk Assessment – ability to identify and minimize potential risk unique to this project Value Added Option – ability to add value to the project in terms of time, money or qualityValue Added Option – ability to add value to the project in terms of time, money or quality

Scope Plan Scope Plan (50 Points)(50 Points) Concise synopsis of the work that will be performed (major tasks, steps, or work packages). Concise synopsis of the work that will be performed (major tasks, steps, or work packages). Vendors impression of how they will achieve the objectives of the consortium Vendors impression of how they will achieve the objectives of the consortium

Past Performance Information Past Performance Information (150 Points)(150 Points) FirmFirm Program AdministratorProgram Administrator

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81

Filter 1Past

PerformanceInformation

Filter 2Proposal & RAVA Plan

Filter 4Prioritize (Identify

Best Value)

Filter 5Pre-Award

Phase (Pre-Plan)

Filter 6Weekly

Report &Post-

Rating

Time

Qualit

y o

f V

endors

Filter 3Interview

High

Low

Summary of Proposal Summary of Proposal SubmittalSubmittal

Proposal Includes:1) Cost/Financial Information2) RAVA Plan (3)3) Scope Plan (2)4) PPI

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Coverage/Plan Coverage/Plan CharacteristicsCharacteristics

Consortium goal was to standardize coverage between all three University's Consortium goal was to standardize coverage between all three University's (to maximum extent possible). However, deviations were made as necessary (to maximum extent possible). However, deviations were made as necessary (BSU athletic coverage, ISU RX Coverage, Capitated Fee, etc)(BSU athletic coverage, ISU RX Coverage, Capitated Fee, etc)

Consortium goal was to increase plan characteristics (to provide better Consortium goal was to increase plan characteristics (to provide better coverage for students)coverage for students)

NO CRITERIA BSU ISU LCSC CONSORTIUM

1 Deductible Per Academic Year (In-Network) $250 $250 $250 $250

2 Deductible Per Academic Year (Out-Of-Network) $500 $250 $250 $500

3 Maximum Benefit (Standard) $100,000 $50,000 $50,000 $250,000

4 In-Network Coinsurance 80% 80% 80% 80%

5 In-Network Max out of Pocket $4,000 No MOP No MOP $4,000

6 Out-Of-Network Coinsurance 50% 60% 80% 60%

7 Out-Of-Network Max out of Pocket $6,000 No MOP No MOP $6,000

8 RX Drug Coverage (Max) $400 None $500 $500*

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SHIP AnalysisSHIP AnalysisNO CRITERIA

DETAILED WEIGHTS

FIRM A FIRM C FIRM D FIRM E FIRM F

1 Cost - Overall Annual Cost to Consortium 50 $12,237,529 $11,051,451 $11,437,893 $12,928,466 $13,063,2352 Cost - BSU Annual Student Premium (per-student per-year cost): 38 $1,772 $1,552 $1,685 $1,806 $1,9143 Cost - BSU Annual Spouse Premium (per-individual per-year cost): 6 $2,200 $3,992 $2,865 $3,066 $3,2484 Cost - BSU Annual Dependent Premium (per-individual per-year cost): 6 $1,886 $2,249 $2,444 $2,124 $3,6165 Cost - ISU Annual Student Premium (per-student per-year cost): 38 $1,267 $1,185 $1,113 $1,394 $1,2596 Cost - ISU Annual Spouse Premium (per-individual per-year cost): 6 $1,660 $3,048 $2,827 $2,937 $3,6277 Cost - ISU Annual Dependent Premium (per-individual per-year cost): 6 $1,424 $1,717 $1,209 $2,038 $1,5518 Cost - LCSC Annual Student Premium (per-student per-year cost): 38 $1,228 $1,244 $1,298 $1,484 $1,6159 Cost - LCSC Annual Spouse Premium (per-individual per-year cost): 6 $1,626 $3,200 $3,300 $3,066 $2,222

10 Cost - LCSC Annual Dependent Premium (per-individual per-year cost): 6 $1,394 $1,803 $1,411 $2,124 $2,31011 Interview Rating - The Program Administrator 175 6.7 7.7 7.1 7.4 7.412 Interview Rating - The Claims Administrator 70 6.6 6.1 4.6 5.3 8.313 Interview Rating - The Waiver Administrator 35 5.8 7.6 5.4 6.0 6.014 Interview Rating - The Data Base Manager 35 5.2 5.0 3.9 4.6 4.615 Interview Rating - The Marketing Manager 35 7.8 6.4 5.0 8.1 8.117 RAVA Plan Rating 250 7.42 6.25 7.42 5.58 5.1718 Work Plan Rating 50 6.67 7.17 6.33 5.50 5.5819 PPI - Firm - Satisfaction with the associated costs of the service 14 9.7 9.1 9.9 10.0 10.020 PPI - Firm - Satisfaction with the benefits provided by the service 14 9.9 9.5 10.0 10.0 10.021 PPI - Firm - Ability to manage the service / program 14 9.9 9.8 10.0 10.0 10.022 PPI - Firm - Ability to document and provide accurate reports 14 9.8 9.9 9.9 10.0 10.023 PPI - Firm - Overall customer satisfaction 14 10.0 9.8 9.8 10.0 10.024 PPI - Firm - Number of different projects 14 10.0 20.0 9.0 10.0 10.025 PPI - Firm - Number of different customer responses 14 10.0 20.0 9.0 10.0 10.026 PPI - Administrator - Satisfaction with the associated costs of the service 7 9.7 10.0 9.8 10.0 10.027 PPI - Administrator - Satisfaction with the benefits provided by the service 7 9.9 10.0 9.9 10.0 10.028 PPI - Administrator - Ability to manage the service / program 7 9.9 10.0 9.9 10.0 10.029 PPI - Administrator - Ability to document and provide accurate reports 7 9.8 10.0 9.7 10.0 10.030 PPI - Administrator - Overall customer satisfaction 7 10.0 10.0 9.7 10.0 10.031 PPI - Administrator - Number of different projects 7 10 10 10 10 1032 PPI - Administrator - Number of different customer responses 7 10 10 10 10 10

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Analysis of ProposalsAnalysis of Proposals

Total Score: 923 916 886 831 840

NO CRITERIA FIRM A FIRM C FIRM D FIRM E FIRM F

1 Cost - Average Student Premium $1,422 $1,327 $1,365 $1,561 $1,596

2 Cost - Average Spouse & Dependent Premium $1,698 $2,668 $2,343 $2,559 $2,762

3 Average Interview Rating 6.4 6.6 5.2 6.3 6.9

4 RAVA Plan Rating 7.4 6.3 7.4 5.6 5.2

5 Work Plan Rating 6.7 7.2 6.3 5.5 5.6

6 PPI - 1-10 Rating 9.9 9.7 9.9 10.0 10.0

7 PPI - Number of projects and clients 10 17 9 10 10

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Overall Best-Value ResultsOverall Best-Value Results

Best-Value Results:Best-Value Results: Student Premium has Student Premium has decreaseddecreased by by 2%2% (-$26) (-$26) Spouse & Dependent Premium has Spouse & Dependent Premium has decreaseddecreased by by 19%19% (-$519) (-$519) In general, Benefits/Coverage have been increasedIn general, Benefits/Coverage have been increased

School Premiums 2006-2007 2007-2008 2008-2009 2009-2010Average

Increase Per Year ($)

Average Increase Per

Year (%)Student $1,012 $1,182 $1,263 $1,385 $124 11%

Spouse & Dependent $1,843 $2,022 $2,104 $2,220 $126 6%

• Previous Program:Previous Program:– Student Premiums increased $124/year (past 4 years)Student Premiums increased $124/year (past 4 years)– Spouse & Dependent Premiums increased $126/yearSpouse & Dependent Premiums increased $126/year

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Case Study: ASUFood Services Contract

No Summary Criteria ScaleFirm A

(Incumbent)Firm B Firm C

1 RAVA Plan (1-10) 5.9 7.1 6.32 Transition Milestone Schedule (1-10) 5.2 7.0 6.33 Interview (1-25) 15.8 16.8 13.54 Past Performance Information - Survey (1-10) 9.8 10.0 9.85 Past Performance Information - #/Clients Raw # 5.7 3.0 4.46 Past Performance Information - Financial (1-10) 7.0 8.7 6.97 Financial Rating (1-10) 4.0 8.0 8.08 Financial Return - Commissions Raw $ 30,254,170$ 60,137,588$ 64,000,000$ 9 Capital Investment Plan Raw $ 14,750,000$ 20,525,000$ 12,340,000$

10 Equipment Replacement Reserve Raw $ 7,213,342$ 4,100,001$ 8,171,811$ 52,217,512$ 84,762,589$ 84,511,811$ Finanical Totals

No Summary Criteria ScaleFirm A

(Incumbent)Firm B Firm C

1 RAVA Plan (1-10) 5.9 7.1 6.32 Transition Milestone Schedule (1-10) 5.2 7.0 6.33 Interview (1-25) 15.8 16.8 13.54 Past Performance Information - Survey (1-10) 9.8 10.0 9.85 Past Performance Information - #/Clients Raw # 5.7 3.0 4.46 Past Performance Information - Financial (1-10) 7.0 8.7 6.97 Financial Rating (1-10) 4.0 8.0 8.08 Financial Return - Commissions Raw $ 30,254,170$ 60,137,588$ 64,000,000$ 9 Capital Investment Plan Raw $ 14,750,000$ 20,525,000$ 12,340,000$

10 Equipment Replacement Reserve Raw $ 7,213,342$ 4,100,001$ 8,171,811$ 52,217,512$ 84,762,589$ 84,511,811$ Finanical Totals

$32 Million Dollars (Over 10 Years)

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After 1 Year: Monitoring Based on Measurements Increase sale of food by 14% Increased cash to ASU by 23% Minimized management cost by 80% Increased customer satisfaction by 37% Increased capital investment by 100%

1 Total Revenue ($M) 27.02$ 30.83$ 3.81$ 14%

2 Total Return & Commissions ($M) 2.17$ 2.67$ 0.50$ 23%

3 Captial Investment Contract ($M) 14.75$ 30.83$ 18.08$ 109%

4 Captial Investment 2006 vs. 2007 ($M) 0.26$ 5.70$ 5.44$ 2092%

5 ASU Administration (# of People) 7 1.5 -5.5 -79%

6 Customer (Student) Satisfaction (1-10) 5.2 7.1 1.9 37%

7 Myster Shopper Satisfaction N/A 9.6 -- --

CategoryNoFY 06-07

IncumbentFY 07-08

New VendorDifference % Difference

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W W W . P B S R G . C O M

2009 Performance Metrics2009 Performance MetricsNo Catergory

YTD Prior Year YTD Actual

Var Act. vs PY

Var Act. vs PY %

1 Mandatory Meal Plan Sales - Meals ($K) (Meal Swipes) 8,915.5$ 8,212.2$ (703.3)$ -7.9%2 Voluntary Meal Plan Sales - Meals($K) (Meal Swipes) 294.2$ 404.1$ 109.9$ 37.4%3 Retail Sales ($K) 15,408.1$ 17,320.4$ 1,912.3$ 12.4%4 Catering Sales ($K) 2,329.1$ 2,526.5$ 197.4$ 8.5%5 Camp/Conference Sales ($K) -$ 865.2$ 865.2$ #DIV/0!6 All Other Sales (Subcontractors & Sushi) ($K) 3,030.9$ 3,807.2$ 776.2$ 25.6%7 TOTAL REVENUE 29,977.8$ 33,135.6$ 3,157.8$ 10.5%8 Commissions on Total Revenue ($K) 1,902.3$ 2,011.3$ 109.0$ 5.7%9 Subsidy - DPC, West & Polytechnic ($K) 391.7$ 1,381.6$ 989.9$ 252.7%

10 Commissions Paid to ASU ($K) (Commission less Subsidy) 1,723.3$ 629.7$ (1,093.6)$ -63.5%11 Commission % 6.35% 6.07% -0.28% -4.35%

No CatergoryYTD Prior

Year YTD Actual Actual vs PYVar Act. vs PY %

1 Number of Mandatory Meal Plans Sold 5,361 6,159 798 14.9%2 Number of Voluntary Meal Plans Sold 2,128 2,882 755 35.5%3 Customer (Student) Satisfaction Survery (1 - 10 (2x/yr) 7.34 7.27 -0.07 -1.0%

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Performance Metrics – Combined ASU

FY 2010

No Category

YTD Prior Year - ADJUSTED wk 6

Sep YTD Actual YTD BudgetVar Act. vs

PYVar Act. vs

PY %Var Act. vs

BudgetVar Act. Vs Budget %

1 Mandatory Meal Plan Sales - Meals ($K) (Meal Swipes) 7,914.4$ 14,609.2$ 12,531.2$ 6,694.8$ 84.6% 2,078.0$ 16.6%

2 Voluntary Meal Plan Sales - Meals($K) (Meal Swipes) 390.5$ 372.4$ 264.7$ (18.1)$ -4.6% 107.7$ 40.7%

3 Retail Sales ($K) (Sun $, M&G Vol, M&G Mandatory and Cash & Credit Cards)16,756.8$ 17,656.1$ 22,697.4$ 899.2$ 5.4% (5,041.3)$ -22.2%

4 Catering Sales ($K) 2,475.5$ 2,502.0$ 2,733.4$ 26.5$ 1.1% (231.4)$ -8.5%

5 Camp/Conference Sales ($K) 865.2$ 822.1$ 648.9$ (43.1)$ -5.0% 173.2$ 26.7%

6 All Other Sales (Subcontractors & Sushi) ($K) 3,703.3$ 3,793.8$ 5,169.6$ 90.5$ 2.4% (1,375.8)$ -26.6%

7 TOTAL REVENUE 32,105.7$ 39,755.5$ 44,045.1$ 7,649.8$ 23.8% (4,289.6)$ -9.7%

8 Commissions on Total Revenue ($K) 2,011.2$ 2,413.2$ 2,673.5$ 402.0$ 20.0% (260.4)$ -9.7%

9 Subsidy - DPC, West & Polytechnic ($K) 1,202.3$ 604.6$ 1,157.6$ (597.7)$ -49.7% (553.0)$ -47.8%

10Commissions Paid to ASU ($K) (Commission on Total Revenue less Subsidy) 803.7$ 1,808.5$ 1,515.9$ 1,004.9$ 125.0% 292.6$ 19.3%11 Commission % 6.07% 6.07% 6.07%

No Category YTD Prior Year YTD ActualYTD

BudgetActual vs

PYVar Act. vs PY %

Var Act. vs Budget

Var Act. Vs

Budget %

1 Number of Mandatory Meal Plans Sold 6,133 7,573 7,843 1,455 23.6% -229 -2.9%

2 Number of Voluntary Meal Plans Sold 2,882 4,056 2,215 1,174 40.7% 1841 83.1%

Financial Performance Metrics

Performance Metrics

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U of MN ObjectivesU of MN Objectives The UMN has a goal to be recognized as a top research institution in the world

In 2005, CPPM partnered with the PBSRG (ASU) to implement the PIPS Best Value Process

CPPM’s Objectives of the Best-Value Program are to: Contract to high performers Respond faster to customer needs Increase performance (on time, on budget, high quality)

Increase efficiency of procurement (spend taxpayers money more efficient)

Create a fair and open process for all vendors

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CPPM Strategic Plan CPPM Strategic Plan First organization to establish and follow a Strategic Plan

Ultimate Goal: CPPM take over entire program and is successful in implementing and sustaining the program. Year 1 – Pilot Testing Year 2 – Evaluation and Continued Testing Year 3 – Expansion Year 4 – Expansion Year 5 – Infusion & Transition Year 6 – Transition

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CPPM Strategic Plan CPPM Strategic Plan Year 1 Identify and educate core group Identify qualified vendors Implement best-value Analyze pilot projects

Year 2 Continue testing best-value Evaluate core group and refine Expand test to different trades (General

Construction) Educate more internal CPPM staff Implement a weekly project tracking

system Refine list of qualified vendors Educate and debrief qualified vendors on

initial project results

Year 3 Allow other CPPM personnel to test Automated online Directors Report Monitor all CPPM projects (LB & BV) Expand testing (A/E Services) Identify performance of UMN PM’s,

Procurement, other critical areas, etc. Train CPPM on all BV components

Year 4 CPPM acquire and perform all best-value

functions (educate and train) PBSRG assist on areas of weakness CPPM handle analysis and tracking of all

weekly reports Implement best-value on a larger scale Educate other UMN groups (Energy,

Zones, Permitting, Codes, ect)

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No Activity Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

1 Education / Training / Debriefing 0% 0% 25% 50% 75% 100%

2 Data Collection (PPI) on Vendors 0% 0% 0% 0% 0% 0%

3 Proposal Analysis / Review / Rating 0% 25% 75% 75% 100% 100%

4 Modeling / Identification of Best-Value 0% 0% 0% 25% 50% 100%

5 Weekly Risk Reporting System 0% 0% 25% 25% 75% 100%

6 Directors Reporting 0% 0% 0% 0% 0% 100%

7 Documentation and Analysis 0% 0% 0% 25% 50% 75%

8 Modification / Evolution / Updating 0% 0% 0% 0% 0% 0%

Transitional PlanTransitional Plan

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Award Analysis: Number of Best-Value Procurements: 161 Awarded Cost: $50.6M (11% below average cost) Average Number of Proposals: 4 Projects Where Best-Value was also Lowest Cost: 53% 85% of projects were awarded to vendor with highest / second highest

RAVA Plan (7.3 vs 5.9)

Performance Information: Contractor Impacts: 0% Change Orders / 4% Delay Vendor post project rating: 9.6 Average Contractor Increase in Profit: 5%

Current Construction Current Construction ResultsResults

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PM 1 PM 2 PM 3 PM 4

Procurement Officer 1 Procurement Officer 2

Director

Contractor 1

Contractor 2

Contractor 3

Contractor 4

Contractor 3

Contractor 6

Contractor 1

Contractor 8

Contractor 9

Contractor 7

Contractor 7

Contractor 2

Contractor 4

Contractor 8

Contractor 9

Contractor 2

Program ReportProgram Report

Director 1 Director 2

PM 1 PM 2 PM 3 PM 4

Vice President

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Report – Overall ProgramReport – Overall Program

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Report - DirectorsReport - Directors

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Report - End UsersReport - End Users TEAM 1

(President / University / Admin)

TEAM 2Academic Health

Center

TEAM 3Provost College

1 Total Number of Projects 19 14 52 Percent of Projects Procured Using PIPS 79% 86% 80%3 Total Awarded Cost: $5,359,995 $2,821,005 $2,353,7614 Average Number of Risks per Project 3 8 12

5 Overall Owner Impacts (Time & Cost) 7.7% 41.3% 41.1%6 Owner Change Order Rate 0.6% 3.4% 20.0%7 Owner Delay Rate 7.2% 37.8% 21.1%8 Percent of Projects without Owner Cost Changes 63% 36% 80%9 Percent of Projects without Owner Delays 68% 50% 80%

10 Overall Contractor Impacts (Time & Cost) 8.1% 19.6% 14.8%11 Contractor Change Order Rate 0.1% 0.1% -0.8%12 Contractor Delay Rate 8.0% 19.6% 15.6%13 Percent of Projects without Contractor Cost Changes 95% 93% 100%14 Percent of Projects without Contractor Delays 79% 79% 60%

15 Total Number of Completed Projects 4 2 116 Total Number of Client Surveys Returned 3 2 117 Percent of Projects Evaluated by Client 75% 100% 100%18 Average PM Post Project Rating of Contractor 6.75 10 1019 Average Client Post Project Rating of Contractor 7.7 8.5 8.020 Average Client Post Project Rating of CPPM 10.7 8.5 7.0

Contractor Impacts

Owner Impacts

Satisfaction Ratings

General Overview

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Report – Internal PM’sReport – Internal PM’s

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Report - ContractorsReport - Contractors

No ContractorTotal

Number of Projects

Total Awarded Cost:

Owner Change Order Rate

Owner Delay Rate

Vendor Change Order Rate

Vendor Delay Rate

Percent of Late Reports

Vendor Performance

1 Contractor 118 3 $ 721,965 0.3% 18.1% 0.2% 66.8% 53% 120%2 Contractor 119 3 $ 220,002 0.7% 10.4% 0.0% 0.0% 69% 69%3 Contractor 120 1 $ 269,850 9.4% 303.0% 0.0% 18.2% 47% 65%4 Contractor 104 3 $ 459,225 1.6% 2.7% 0.0% 18.8% 37% 56%5 Contractor 121 1 $ 241,575 0.0% 21.9% 2.7% 50.0% 0% 53%6 Contractor 105 8 $ 1,611,015 0.3% 32.9% 0.0% 16.3% 32% 49%7 Contractor 106 9 $ 1,280,362 2.2% 31.1% 0.7% 3.2% 35% 39%8 Contractor 122 3 $ 367,650 0.0% 79.1% 0.0% 1.4% 37% 38%9 Contractor 107 1 $ 178,440 0.0% 0.0% 0.6% 11.4% 25% 37%

10 Contractor 123 2 $ 3,227,182 14.9% 0.0% -0.6% 5.4% 30% 35%11 Contractor 108 2 $ 327,295 0.0% 135.4% 0.0% 0.0% 32% 32%12 Contractor 124 1 $ 69,218 3.5% 0.0% 0.0% 0.0% 31% 31%13 Contractor 125 3 $ 1,150,738 1.9% 7.3% 0.0% 4.2% 26% 30%14 Contractor 109 5 $ 534,095 2.0% 23.2% 0.0% 0.0% 29% 29%15 Contractor 126 1 $ 323,000 3.3% 3.4% 0.0% 6.8% 22% 29%16 Contractor 110 1 $ 308,882 1.2% 24.8% 0.0% 0.0% 27% 27%17 Contractor 127 7 $ 1,793,355 3.8% 13.6% 0.0% 0.0% 26% 26%18 Contractor 128 4 $ 2,956,800 1.3% 1.7% 0.0% 12.2% 11% 23%19 Contractor 129 6 $ 1,319,789 2.2% 16.2% 0.0% 11.0% 9% 21%20 Contractor 111 4 $ 1,096,707 0.1% 0.0% 0.0% 9.8% 10% 19%21 Contractor 112 1 $ 446,100 0.0% 6.9% 0.0% 0.0% 15% 15%22 Contractor 113 3 $ 552,815 5.1% 29.4% 0.0% 7.0% 8% 15%23 Contractor 114 2 $ 1,841,157 13.0% 215.8% 0.0% 0.0% 13% 13%24 Contractor 130 4 $ 795,791 0.8% 0.0% 0.0% 0.0% 12% 12%25 Contractor 101 4 $ 322,400 0.0% 0.0% 0.0% 0.0% 8% 8%26 Contractor 115 3 $ 753,660 10.9% 54.7% 0.0% 0.0% 7% 7%27 Contractor 102 1 $ 14,150 0.0% 0.0% 0.0% 0.0% 0% 0%28 Contractor 116 1 $ 109,710 0.0% 0.0% 0.0% 0.0% 0% 0%

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Report – Yearly AnalysisReport – Yearly Analysis

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Report – Top 10 Riskiest Report – Top 10 Riskiest ProjectsProjects

No Project Awarded CostAwarded Duration

Overall Change Order Rate

Overall Delay Rate

Percent of Late Reports

Risk Analysis Factor

PM Director

1 Mayo Remodel Suite A652 $ 269,850 66 9% 321% 47% 377% Wycliffe Waganda Gary Summerville

2 Barn Clean Renovations $ 269,000 80 2% 166% 60% 229% Wycliffe Waganda Justin Grussing

3 WBOB Remodel Suite 150 $ 273,100 99 1% 96% 37% 134% Pete Nickel Gary Summerville

4 Vet Sciences Third Floor $ 96,930 49 3% 86% 28% 116% Pete Nickel Gary Summerville

5Weaver Densford College of Pharmacy

$ 90,862 28 2% 25% 80% 107% Pete Nickel Gary Summerville

6 PWB Remodel Suite 6-240 $ 127,338 82 17% 23% 64% 104% Steve Bailey Gary Summerville

7 PWB Room 7-158B $ 46,504 30 0% 0% 100% 100% Pete Nickel Gary Summerville

8Oak Street Parking Surveillance

$ 246,802 74 0% 0% 100% 100% George Mahowald Justin Grussing

9 Snyder Bldg Exterior Door $ 219,000 121 -4% 81% 22% 100% Wycliffe Waganda Justin Grussing

10 Heller Hall Renovation $ 1,593,561 254 29% 0% 50% 79% Matt Stringfellow Justin Grussing

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Report – Analysis of RisksReport – Analysis of Risks

Risk CategoryNumber of

RisksImpact to

CostImpact to Schedule

Percent Impact to

Cost

Percent Impact to Schedule

1) Client Impacts 114 $660,369 1,200 59% 46%Client Scope Change / Decision 111 660,369$ 976 59% 37%

Client Requested Delay 3 -$ 224 0% 9%

2) CPPM Impacts 135 $329,425 885 30% 34%Design Issue 48 189,876$ 230 17% 9%

CPPM Issue (Codes / Permits) 36 46,140$ 170 4% 7%

CPPM Issue (Energy Mgmt) 2 47,533$ 30 4% 1%

CPPM Issue (Hazardous / Health & Safety) 8 35,407$ 118 3% 5%

CPPM Issue (NTS) 8 10,018$ 64 1% 2%

CPPM Issue (Contract / Payment) 11 -$ 132 0% 5%

CPPM Issue (Other) 22 451$ 141 0% 5%

3) Contractor Impacts 43 $21,005 411 2% 16%Contractor Issue 11 -$ 101 0% 4%

Contractor Oversight of Design 9 21,005$ 38 2% 1%

Contractor Issue with Supplier / Sub 23 -$ 272 0% 10%

4) Unforeseen Impacts 19 $102,544 111 9% 4%311 1,113,343$ 2,607

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Research from Contractor DelaysResearch from Contractor Delays

Contractor Risks %

Delivery of Materials Delayed 28%

Installation errors 26%

Incorrect material ordered or delivered 11%

Alteration of installation needed 9%

Manufacture didn't have sufficient materials 9%

Misunderstanding of Construction Documents 6%

Door Frames incorrect size 4%

Soil compaction 2%

104

52% of risks due to errors in materials delivered

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Targeted Business GroupTargeted Business Group(Minority & Disadvantaged)(Minority & Disadvantaged)

Out of 63 qualified contractors, 18 are TGB (29%)

Out of 161 PIPS Projects, 26 were awarded to TGB Contractors (16%)

Awards were based on best-value, which shows that there are high performing TGB vendors in the MN community