Technology Procurement Process

D. Protti hinf 351 (selc_pro.ppt) 04/10/23 1

Technology Procurement Process

Calgary Regional Health Authority

July 20, 1999


Procurement Process Expectations

it will minimize the time required to select a system

it provides each Selection Committee member with

a structured means of contributing to the final

choice

it assumes that there is a selection to be made

entails up to 13 phases

phases may or may not occur and may be in a

different order


Procurement Process Phases

1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


1. Devise A Strategic Information Systems Plan

Consistent with the the Region’s corporate strategic plan

Identifies the major information needs/problems facing the the Region and may identify specific priority areas



Identifies the broad goals and possibly the objectives to be achieved

Includes a strategic system design

» identifies the architectural approach

» concentrates on operational processes rather than department functions

» outlines major constraints, e.g., HL-7 and/or MIS Guidelines compliant, etc..



Determine if the Region is committed to

“buying” vs. “building”

Form an Information Technology Selection

Committee

Establish the budget or level of expenditures

which with the committee will work




2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


2. Conduct a Preliminary Survey

what is available on the market place?

what is the “state-of-the art?

how do we answer the above questions?


Methods of staying current

conferences and trade shows read the literature» e.g. COACH’s Healthcare Computing and

Communications Resource Guide talk to colleagues (particularly those at leading

edge) take in vendor presentations surf the Web issue a Request for Information (RFI)


What is an RFI?

a letter to vendors who are perceived to have the type of systems the Region desires

letter (typically 2-3 pages) outlines in broad terms what the Region is looking for and requests that vendors send information

vendors return what is often returned to as “boiler plate”; off-the-shelve materials with no tailoring of the material to the Region’s needs» Banish refers to it as “brochureware”

vendors often directed to “stay away” material returned often seen to have an educational

value



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey

3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


3. Prepare Functional Specifications

a vendor independent identification of the required functionality

may be written from a work-flow or patient perspective as opposed to departmental one (the Region may be committed to re-engineering)

may include network topography, terminal device configuration, etc...



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications

4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


4. Conduct a Benefits Analysis

identify and forecast the benefits being sought through the implementation of the system(s)

an early stage of the “managing expectations” process

if done well, will entail solid user “buy-in” serves as a baseline for later evaluations may include of objectives (i.e., measurable)


Objectives should be SMART

S = Specific

M = Measurable

A = Achievable (Accountable)

R = Resourced

T = Timed



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis

5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


5. Issue a Request for Proposal (RFP)

a document which outlines in some detail what the Region wishes

likely will be in high-level rather than in nitty-gritty detail of exactly what is required (detail will be needed at some point)

includes a Region profile» see the CHA web site for a sense of what

would be included in a profile


5. Issue a Request for Proposal (cont’d)

includes general (the Region wide) and typically functional (departmental) specifications

typically requires vendors to discuss in detail how their system(s) will satisfy the the Region’s needs; true/false or multiple choice responses may not be acceptable

document needs to “sell the Region” requires that the Region identify vendors (typically

8-10) to be sent the RFP



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)

6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


6. Develop Narrowing Criteria

Identify the essential requirements - those specific facets which must (should) be satisfied if the vendor is to be considered beyond the first stage

typically a small number (10-15) of essential requirements

typically each member of the selection committee will independently reviews all of the proposals

begins to develop an analytical approach to compliment the more mechanistic “scoring” of features which will follow



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria

7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


7. Preliminary Review of the Vendor Proposals

distribute the vendors responses (could be up to 7-8) to the Region’s RFP to all Committee members

each member independently reviews all of the proposals and determines if the proposals does or does not address the essential requirements with a simple "Yes", "No", "Not sure"

intent of the Region stage is to reduce the proposals to a workable number (2-4) as future phases will be more time consuming and costly

individual member findings are tabulated. » if member views of the essential requirement of are not unanimous,

discussion is necessary» Proposals with one or more "No's" are usually eliminated from

further consideration



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals

8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


8. Telephone Survey

It may be worth conducting a telephone survey to identify:» What applications are running in what facilities?» Why the facility chose the vendor - did they consider

others?» What were facility's expectations - are they being met?» What type of hardware and systems software is being

used?» Whether the facility is willing to have the Region staff

visit? The above is used to determine which facilities/sites are to be

visited, taking into account geography, cost, and other factors



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey

9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


9. Vendors Presentations

permits vendors to come and present their systems to a wider audience than just the selection committee

permits some hands-on experimentation gives the Region a look at the vendor’s clinical

representatives (if any) opportunity to meet their key people, preferably

the project leader/manager



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations

10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


10. Site Visits

typically include 1-2 facilities from each vendor

may include a visit to the vendor's headquarters

demonstrates to the vendors that the Region is

serious and that they are willing to invest

resources up-front to minimize the risks of

selecting the wrong vendor



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits

11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison13. Finally - System Selection


11a. Performance Scoring

objective of this phase is to assign a "score" to each vendor

score will be made up of a number of factors such as:» functionality» technical characteristics» vendor characteristics

The criteria to be scored closely follow what was identified in the RFP


11b. Financial Analysis

rigorous quantitative cost analysis may or may not be done independently of the

performance scoring costs presented are evaluated in terms of:

» front end costs (installation, conversions, renovations, transportation, training, etc..)

» operating costs (hardware, software, maintenance, insurance, supplies, training, staffing, etc..)


11b. Financial Analysis (cont’d)

goal is to compare vendor proposals as objectively and as consistently as possible

requires accounting skills as vendor responses are rarely consistent in terms of presenting financial data

assumptions and adjustments usually have to be made to develop reasonably comparable figures

cost comparison table is developed which estimates a single, all-encompassing, cost for each vendor’s system(s)



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis

12. Price Performance Comparison13. Finally - System Selection


12. Price Performance Comparison

final "quantitative" step of the selection process is the amalgamation of the results of the price performance and the financial analysis

produces a price performance ratio which identifies which vendor produces the most results for the least investment

may entail a cost-benefit analysis



1. Devise A Strategic Information Systems Plan2. Conduct a Preliminary Survey3. Prepare Functional Specifications4. Conduct a Benefits Analysis5. Issue a Request for Proposal (RFP)6. Develop Narrowing Criteria7. Preliminary Review of the Vendor Proposals8. Telephone Survey 9. Vendors Presentations10. Site Visits11a. Performance Scoring11b. Financial Analysis12. Price Performance Comparison

13. Finally - System Selection


13. Finally - System Selection

The price performance ratios provide the Committee with the "scientific" evidence on which to base their final choice.

However, the final choice inevitably takes into account other factors which are impossible to quantify


Next Stage - Contract Negotiations

Clarify vendor response, particularly the costs

Very important to :

» clearly identify vendor responsibilities

» have measurable system performance criteria

» identify appropriate remedies for failure to perform

Contract should be more than the vendor’s standard one

May entail having the vendor assist in developing the cost

benefit case and/or business case which will likely have to be

submitted to the Board and perhaps to the Ministry


Next Stage - Develop An Implementation Plan

Begin process of looking at the critical applications in more depth - a detailed design specification

Identify all user interactions with the system Identify the resources required, site

preparation, etc.. Identify the timetable and specific

responsibilities


Begin System Installation

Region staff member should take leadership responsibility (vs vendor or consultant)

Educate, inform, and communicate constantly

Cash in on the earlier “buy-in” commitments

Manage expectations

Technology Procurement Process

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