Good? Better? Best? How Do You Know?

___________

Timothy Fitzgibbon, ModeratorDirector, Guaranteed Student Loan Program

Iowa College Student Aid Commission

Good? Better? Best? How Do You Know?

___________

Timothy Fitzgibbon, PresenterDirector, Guaranteed Student Loan Program

Iowa College Student Aid Commission

RFP for Collection Services Pre-RFP Release

– Develop Time-Line– Create RFP Draft– Determine Evaluation Method

Post-RFP Release– Addressing Vendor Questions– Evaluating Vendor Bids– Contract Implementation

Pre-RFP Release Develop Time-Line

• January 1st Target– March 1 – Research and begin RFP Draft– May 1 – Release RFP– May 22 – Deadline for Vendor Questions

• Consider Bidders Conference

– June 11 – Respond to Vendor Questions

Pre-RFP Release

Time-Line - continued– July 1 – Deadline for Vendor Responses– August 1 – Announce Winning Bidders

and Negotiate Contract– September 1 – Begin System Testing – January 1 – Begin New Placements

Pre-RFP Release Create RFP Draft

– Don’t Reinvent the Wheel• Template from State General Services

• Previously Successful RFP

– Provide Informative Introduction• Purpose and Expectations

• Agency Background

• Historical Data

Pre-RFP Release RFP Draft - continued

– Provide Administrative Information• Contact Person and Communication

• Procurement Time-Line

• Define Restrictions on Vendor Bids • Invite for Questions • Bid Handling upon Receipt

• Appropriate Caveats

Pre-RFP Release RFP Draft - continued

– List Detailed Service Requirements• Processes

• Record-Keeping

• Reporting

• Data/System

• Regulatory

Pre-RFP Release RFP Draft – continued

– Determine Fee Strategy

Set Fees at or Above Market Rates• Ensures Vendor’s Best

• How do you Know “Market Rates”?

Require Vendor Pricing Bids• Ensures Market Rate

• Adds Complexity to Evaluation

Pre-RFP Release RFP Draft – continued

– Specify Format and Content• # of Bids, # of Copies, Format • Executive Summary

• Template for Service Requirement Responses

• Vendor Background

• Vendor Experience

Pre-RFP Release

RFP Draft – continued– Specify Format and Content

• No Promotional/Display Materials

• Financial Information

• Firm Bid Terms

• Cost Proposal

Pre-RFP Release

RFP Draft – continued – Include Sample Contract – Require Letters Certifying:

• Information in Bid is True and Accurate

• No Conflict of Interest

• No Debarment, Suspension, etc.

• Authorization to Release Information

Pre-RFP Release Determine Evaluation Method

– Develop Scoring Matrix – Decide on Using Internal Staff, External

Consultant, Combination of Both– Identify Disqualifiers

Post-RFP Release Addressing Vendor Questions

– Organize by Question– Refer Back to RFP when Possible– Focus on Expected Deliverable– Clarify Responses Become Part of RFP– Post Responses to Web-Site– Not All Questions are Questions!

Post-RFP Release Evaluating Vendor Bids

– Apply Disqualifier Criteria– Score Objective Criteria First

• Fees

• State-Based?

• # States Licensed to Practice

• Financial Strength

• Service Requirements

Fee Bid EvaluationVendor Name Regular AWG Rehab FFELP Con. FDLP Con.

Vendor #1 1st 10.95% 11.95% 9.25% 5.00% 5.00%

Sub 12.50% 13.50% 9.90% 5.00% 5.00%

Vendor #2 1st 12.00% 12.00% 12.00% 6.00% 0.00%

Sub 14.00% 14.00% 14.00% 7.00% 3.00%

Vendor #3 1st 11.50% 11.50% 12.50% 5.00% 5.00%

Sub 12.50% 12.50% 13.50% 5.00% 5.00%

Vendor #4 1st 14.00% 14.00% 14.00% 9.00% 9.00%

Sub 16.00% 16.00% 16.00% 9.00% 9.00%

Vendor #5 1st 11.00% 11.00% 13.50% 5.00% 5.00%

Sub 11.00% 11.00% 13.50% 5.00% 5.00%

Vendor #6 1st 18.00% 18.00% 18.00% 11.00% 11.00%

Fee Bid EvaluationWEIGHTED HEAVILY TOWARD REHAB

Collection Projected %

Type by Coll. Type

Regular 15.00%

AWG 6.00%

Tax Offset 9.00%

Rehabilitations 35.00%

FFEL Consolidation 5.00%

FDLP Consolidation 30.00%

Total Consolidation 35.00%

Other

Total 100.00%

Fee Bid EvaluationHigh Weighted

High Rehab Average Total

Historical Projected Rehab Reg/AWG Price Score

5.49% 6.59% 7.76% 7.95% 6.95% 250

6.56% 7.26% 7.68% 8.11% 7.40% 230

6.09% 7.09% 8.27% 8.35% 7.45% 229

5.97% 7.12% 8.37% 8.55% 7.51% 220

6.66% 7.52% 7.97% 8.54% 7.67% 219

6.84% 7.75% 8.79% 8.90% 8.07% 200

7.14% 7.93% 8.65% 8.91% 8.16% 199

7.45% 8.15% 8.36% 8.95% 8.23% 198

7.76% 8.15% 8.44% 8.65% 8.25% 190

7.73% 8.23% 8.49% 8.84% 8.32% 189

7.87% 8.44% 8.49% 9.10% 8.47% 188

7.80% 8.39% 8.63% 9.10% 8.48% 187

Post-RFP Release Evaluating Vendor Bids

– Check Voluntary/Involuntary References only on Highest Scoring Vendors

– Combine/Discuss/Average Scores and Place Vendors in Order High-to-Low

– Apply Additional Considerations• Value of Past or Current Relationships

Post-RFP Release Evaluating Vendor Bids

– Visit Finalists (if Applicable)– Determine Winning Bidders– Identify Alternates

Post-RFP Release Contract Implementation

– Negotiate/Execute Contracts• Determine Final Pricing

– Put System Testing in Motion – Begin Placing Accounts– Evaluate Performance!

General Comments • Document All That You Do

• Strictly Adhere to Non-Contact and Gift Laws

• Consider Fully-Electronic Process • Observe All Open-Records Laws

Good? Better? Best? How Do You Know?

_____Kelly Harrison, Presenter

Director,Training and Development Florida Dept. of Education, OSFA

Performance Evaluation

• Then

• Best Practices

• Now

Then

• Calculated six items for performance rate– Gross Recovery Rate– Adjusted Recovery Rate– Net Back Recovery Rate– AWG Recovery Rate– Customer Service Rate– Annual Performance

Then

• Quarterly

• Fairly complex

• Did it give us what we wanted?

Best Practices

• Visit and discussion with USDE

• What is important to us?

• How can we tell if agencies are doing what we asked?

• How do we ensure agencies follow our collection strategy?

Now

• Calculate three items plus a score modifier– Dollars collected (minus consolidation)– Accounts serviced– Processing rate– Modifier (customer service & compliance)

• Assign quarterly, but can track monthly

Now

• Simple and concise

• Shows if agencies are following direction and collection strategy

• Information shared with agencies

• Performance based placements

Thank You! _____

Kelly Harrison, DirectorTraining and Development Florida Dept. of Education,

OSFA

Good? Better? Best? How Do You Know?

_____Jack Clark, Presenter

Vice PresidentNational Enterprise Systems

Agenda• Pros and Cons

– Pros of RFP’s

– Cons of RFP’s

• Deciding whether or not to bid– Price

– Technical

– References

Agenda (Cont.)– Collector Performance

– Performance Evaluation

– Measuring Results

– Rewarding Performance

– Questions?

Pros of RFP’s• Levels the playing field for all that bid• Understand the customer’s expectations• Decision to bid made by the company• Opportunity to showcase the company• KISS method – keep the document simple• Input from vendors and have pre-bid meeting

Cons of RFP’s• Is this a rate based RFP (lowest bid wins)? • Are the best performing companies chosen?• Does this become a writing contest?

− (Fact vs. Fiction)

• Timelines can be too short for quality RFPsto be completed

Cons of RFP’s (Cont.)• Repetition of the same questions • Not always clear and timely responses to

questions• Either too much or not enough detail in questions

(i.e. not always clear as to where questions begin that are supposed to be responded to)

Cons of RFP’s (Cont.)• Filling out forms that need filled out only if you

were to be awarded• Not always in a format that we can respond to

such as Word. Takes a lot of time to recreate questions

• Setting criteria that eliminates Agencies due to lack of references in a specific product

Price vs. Technical• Are rates set by the Prospect?• Price can be an indication of whether or not to

bid• What is the key factor in winning the bid?

– Pricing or Technical?

• How low can you bid and still be effective?• Target pricing-if pricing is the key factor, set

the range of price that you are looking for

Price vs. Technical (Cont.)• If technical is the key factor Collection

Agencies must understand going into the RFP how they will be evaluated

– Collection System– Managerial Staff Experience– Collection Process– References

• References can be the best or the worst asset in an RFP

• References can be your best salesperson

Performance History• Collection performance should play a big part in

the selection process• How do you rank with your current clients?• Confidentiality Agreements with clients

− If data cannot be provided, does this eliminate Agencies from the process?

Performance Evaluation• Effective criteria:

- Bottom line is dollars collected- Customer service- Customer complaints - Compliance with clients’ contracts

Measuring Results• Should you change performance criteria? Only if

your agencies are not meeting expectations

“If it’s not broke, don’t fix it”

Rewarding Performance• Performance-based compensation drives results:

- Bonuses

- Volume

Questions?