Vendor SelectionMichael Shullich, CISSP, PMP

1

Defined Methodology ◦ Identification of best vendor/product◦ Efficient and repeatable process◦ Quantitative & qualitative scoring◦ Compliance◦ Address potential vendor challenges

Sample Presentation Template to use

2

www.pmi.org/PDF/ap_pmicodeofethics.pdf

CHAPTER 4. FAIRNESS 4.1 Description of Fairness Fairness is our duty to make decisions and act impartially

and objectively. Our conduct must be free from competing self interest, prejudice, and favoritism.

4.3 Fairness: Mandatory Standards As practitioners in the global project management

community, we require the following of ourselves and our fellow practitioners: Conflict of Interest Situations

3

4

5

1 3 5 7 9 12

14

16

6

4 = Must Have

Without this requirement the system will not be considered for evaluation.

3 = Very Important

It would be extremely difficult to function without this feature.

2 = Important

This feature should be included. Can function without this feature but it will have a negative affect on performance.

1 = Desirable

Although this feature is beneficial, its absence will not significantly degrade the system but its presence will improve efficiency.

7

8

Evaluation Score Description

Exceptional1.00

Exceeds basic needs and provides significant additional useful value and potential

Meets Requirements Well

0.75The system compares well with competitors, meets all essential needs and gives all that’s needed

Meets Minimal Requirements Only

0.50System does not compare well to best performers in this category, but still does enough to be useful

Meets Partial Requirements 0.25

The system does not meet all necessary requirements in this area, but does contribute some partial value

Does Not Meet Requirements 0.00

The system does not meet any of the basic requirements at all

9

10

CompanyVendor A <logo> Vendor B <logo> Vendor C <logo>

Product Product-A Product-B Product-C

Employees 1,025 6,000 960

Location UK Los Angeles, Ca San Jose, CA

Technology Window Servers Windows, Unix Cloud

Experience Founded 1980 Revenue $300M

Founded 1981Revenue $400 M

Founded 1998Revenue $200M

Potential 3 – Medium 4 – High 4 – High

Customers 1,000 Customers 2,000 Customers 8,000 customers

Pros Mature product Comprehensive solutionMature product

Low initial Cost Good fit out of the box

Cons Overly Microsoft centricImplementation

High initial cost Implementation

Company Not Profitable

11

Max Vendor-A Vendor-B Vendor-C

Vendor Profile 23.00 16.50 20.75 15.25

Core Functionality 29.00 15.75 17.25 18.75

Extended Functionality 6.00 3.00 3.75 3.75

Regulatory 6.00 4.50 4.50 4.50

Technical 15.00 9.00 11.25 12.00

Usability 21.00 12.75 14.25 14.25

Overall Score 61.50 71.75 68.50

• Vendor Profile: Global reach, stability, innovative, reputation, capabilities, resources

• Core Functionality: <list items evaluated>

• Extended functionality: <list items evaluated>

• Regulatory: <list items evaluated>

• Technical: <list items evaluated>

• Usability: <list items evaluated>

12

Vendor-A Vendor-B Vendor-C

One Time

– Core Licenses $50 $50 $35

– Implementation & Training $50 $50 $35

Reoccurring

– Annual Maintenance $25 $15 $17

First Year Total $125 $115 $70

Five Year Total $245 $235 $140

Five Year Avg. / yr $49 $47 $28

• Vendor-A not discounted• Totals do not include sales tax• Includes Price increase 5% on maintenance

• Does not include 3rd party software• Does not include any additional staffing

13

14

Cost vs. Functionality Cost vs. Functionality (sample)Esti

mate

d 1

st Y

ear

Cost

Percentage of Requirements Met

40 70 100

$150k

$0k

$50k

$100

Vendor CC

B Vendor B

A Vendor A

A

C

B

$200K