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Project Selection and RFP Process Guide

The initiating phase of project management involves recognizing a need and selecting projects to address it through a decision-making process. A project charter is created to formally authorize the selected project, while a Request for Proposal (RFP) is used to solicit external contractors when internal resources are insufficient. The RFP outlines project requirements and evaluation criteria to ensure contractors can submit thorough proposals that meet customer expectations.

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11 views2 pages

Project Selection and RFP Process Guide

The initiating phase of project management involves recognizing a need and selecting projects to address it through a decision-making process. A project charter is created to formally authorize the selected project, while a Request for Proposal (RFP) is used to solicit external contractors when internal resources are insufficient. The RFP outlines project requirements and evaluation criteria to ensure contractors can submit thorough proposals that meet customer expectations.

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Project management

The initiating phase of the project life cycle starts with recognizing a need, prob- lem, or
opportunity for which a project or projects are identified to address the need. Projects are identified
in various ways: during an organization’s strategic planning, as part of its normal business
operations, in response to unexpected events, or as a result of a group of individuals deciding to
organize a project to address a particular need.
Sometimes organizations identify several or many needs but have limited funds and people
available to pursue potential projects to address all of those needs. In such cases, the company must
go through a decision-making process to prioritize and select those projects that will result in the
greatest overall benefit.
Project selection involves evaluating potential projects and then deciding which of these should
move forward to be implemented. The steps in the project selection process are developing a set of
criteria against which the project will be evaluated, listing assumptions about each project,
gathering data and information about each project, and evaluating each project against the criteria.
Having a well-understood evaluation and selection process and a well-rounded committee will
increase the chances of making the best decision that will result in the great- est overall benefit.
Once a project is selected, it is formally authorized using a document referred to as a project charter,
sometimes called a project authorization or project initia- tion document. In this document, the
sponsor provides approval to go forward with the project and commits the funding for the project.
The project charter also summarizes the key conditions and parameters for the project and estab-
lishes the framework for developing a detailed baseline plan for performing the project.
In some cases, an organization does not have the expertise or staff capacity to plan and perform the
project or major portions of the project, and therefore decides to have the project done by an
external resource (contractor). A request for proposal is a document, prepared by the
sponsor/customer, which defines the project requirements and is used to solicit proposals from
potential contractors to do the project. A proposal is a document that includes a proposed approach,
schedule, and budget for meeting the project requirements and accomplishing the project scope. A
good RFP allows contractors to understand what the cus- tomer expects so that they can prepare a
thorough proposal that will satisfy the customer’s requirements at a realistic price.
RFPs may include the project objective or purpose; a statement of work; cus- tomer requirements
for the functional, operational, and performance specifica- tions or capabilities that must be met;
deliverables the customer expects the contractor to provide; acceptance criteria for the deliverables;
a list of any customer-supplied items; any approvals the customer requires; the type of con- tract the
customer intends to use; the payment terms; the required schedule for completion of the project;
instructions for the format and content of the contrac- tor proposals; the due date by which the
customer expects potential contractors to submit proposals; and criteria by which the proposals will
be evaluated.
Once the RFP has been prepared, the customer solicits proposals by notifying potential contractors
that the RFP is available. Business customers and
Copyright 2018 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated,
in whole or in part. WCN 02-200-203

INTERNET EXERCISES
For the website addresses of the organizations mentioned in these exercises, go to “Internet
Exercises” at the book’s companion website at [Link]. It is suggested that you
save this website in your “Favorites” list for easy access in the future.
In order to answer the following questions, perform a search for “Requests for Proposals,” using
your favorite search engine.
1. Based on the results of your search, find an RFP that has been posted on the Web. What company
developed the RFP, and what is the company looking to accomplish?
2. Evaluate the effectiveness of this RFP based on information you have studied in this chapter.
Discuss the strengths and weaknesses of the RFP. Are there any items missing from the RFP that
should have been included?
Chapter 2 Identifying and Selecting Projects 57
QUESTIONS
contractors consider the RFP/proposal process to be a competitive situation. Customers should be
careful not to provide one or more contractors with infor- mation that is not provided to all
interested contractors.
Not all project life cycles include the preparation of a written request for pro- posal by a customer
and subsequent submittal of proposals from contractors. Some endeavors move right from the
initiating phase, where a project is identi- fied and selected, into the planning and performing
phases of the life cycle.

Common questions

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An RFP facilitates the project management process by articulating the project requirements for potential contractors, thus guiding them in preparing thorough proposals to meet customer expectations. Essential components of an RFP include the project’s objectives, a statement of work, performance specifications, expected deliverables, acceptance criteria, approvals required, type of contract, payment terms, schedule for completion, proposal instructions, and evaluation criteria .

Organizations facing multiple needs and limited resources must carefully evaluate potential projects to prioritize those that offer the greatest overall benefit. Challenges include effectively developing evaluation criteria, accurately estimating resources and benefits, and ensuring decision-makers have adequate information and understanding to make informed choices .

Organizations should ensure consistent communication and provide all relevant information equally to all contractors. They should define clear evaluation criteria and use unbiased selection processes. Adhering to transparency in the RFP/proposal process prevents favoritism and enhances fairness and competition among contractors .

An organization might choose to outsource a project if it lacks the expertise or staff capacity to plan and execute the project. In such cases, an external contractor can manage the project's execution based on the requirements laid out in the RFP, ensuring project objectives are met within budget and schedule constraints .

Assumptions play a critical role in project evaluation by providing a basis for estimating project feasibility, costs, and benefits. They must be clearly identified and analyzed as incorrect assumptions can lead to flawed evaluations and poor decision-making. Accurate assumptions are essential for realistic projections and successful project outcomes .

Factors to consider include strategic alignment with organizational goals, potential benefits versus costs, risks involved, resource availability, and expected timeline. Effective criteria should reflect the organization's priority areas and capability to execute the project to maximize impact and resource efficiency .

A project charter is crucial as it provides formal authorization for a project to commence. It typically includes project approval, funding commitment, key conditions, and parameters, establishing a framework for developing a detailed baseline plan. This ensures that all stakeholders have a shared understanding of the project’s strategic objectives .

The project selection process involves several steps: developing criteria for evaluation, listing assumptions about each project, gathering data and information, and evaluating each project against the criteria. A clearly defined evaluation and selection process, along with a well-rounded committee, can help make the best decision for overall benefit .

Strategic planning guides project identification by aligning projects with the organization's long-term goals and objectives. It influences selection by ensuring that chosen projects support strategic priorities, optimizing the allocation of limited resources to high-impact projects .

A well-rounded project selection committee, comprising members with diverse expertise and perspectives, enhances decision-making by ensuring a comprehensive evaluation of projects. It can help identify potential issues, balance different interests, and ensure decisions align with strategic objectives, increasing the likelihood of selecting beneficial projects .

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