As part of the deployment of 5G in several subsidiaries, our client, an international operator, has launched numerous calls for tender.
It is important to note that private players who organize calls for tenders must follow certain guidelines, even if they have the freedom to choose the procedure implemented. Thus, once the guidelines have been set out in the call for tenders, fair contracting prevents the private buyer from substantially modifying a company's consultation conditions (in the same sense that these same guidelines bind candidates not to engage in behaviour likely to distort competition: cartel, submission offer...).
Thus, to manage the bidding process, our client set up a working group made up of several experts: a project manager, technical experts, lawyers, buyers, etc.
He called on our "Bid Analyst" experts to accompany the working group, to provide method, and to guarantee a comprehensive vision of all aspects (budget, deployment schedule, technical choices, commercial conditions, financial model).
The Bid Analyst mission at the heart of the negotiation
The job of a Bid analyst consists in analyzing all the suppliers’ commercial proposals and building the negotiation strategy to get the best offer.
Within the framework of these calls for tender, the preparation phase was key. Among the different stages of preparation, we can mention:
Increased competence in terms of reference and scope statements, including the expression of technical needs and commercial conditions,
Preparing the tools to follow the bidders' responses with the definition of a ranking system,
Automating monitoring tools: this step is crucial as the time between each auction round is very short and you need to be able to respond quickly. Our experts have developed a Power BI-based solution to automate the comparison of total cost of ownership (TCO) of different suppliers,
After this preparation phase, our team led the auction cycle:
Analysis of the bidders' responses to:
- Verify the compliance of the various suppliers with the technical, commercial and contractual requirements,
- Ensure that the technical requirements are well taken into account in the Total Cost of Ownership (TCO) structure, especially the dimensioning and security aspects,
This step allows the ranking of each bidder.
And in parallel, developing the negotiation table:
Once all technical requirements have been met by the suppliers, this tool made it possible to list the points that needed to be negotiated along with the objective to be achieved and the priority for negotiation. This table must be updated at each bidding round.
The tool can for example take the following form:
Moderating the final negotiation cell:
This is the last phase of the bid. All the elements must be ready because this phase can be carried out over a few hours.
Throughout the different bidding rounds, our bid analyst paid particular attention to communication. Indeed, it is essential that all team members are permanently aligned on the speech, the arguments and the negotiation strategy.
Our client has all the information necessary to negotiate and choose a supplier:
- Supplier compliance with dimensioning and safety requirements
- Costs and schedule to deploy the core network, subscriber database, and 5G signaling
- Customized negotiation axes per supplier at each negotiation phase.
A few points of reference
TCO (Total Cost of Ownership): the TCO represents the global cost of a good or a service throughout its life cycle. This calculation method takes into account both direct and indirect costs.
TCO is the sum of several types of costs, commonly divided into 8 types:
- Purchase price: cost price and supplier margin
- Induced cost: transport, packaging, customs, payment terms...
- Acquisition cost: functioning of the purchasing department...
- Cost of ownership: inventory management, depreciation cost...
- Maintenance cost: spare parts, maintenance...
- Cost of use: use-value, operation, services...
- Cost of non-quality: respect of deadlines, addressing non-compliance...
- Cost of withdrawal: recycling, resale, destruction...