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LRH Financial Vendor Strategy

You are a project manager in the human resources department for a global investment management firm, LRH Financial. You are currently updating your benefits administration to an external company; this is expected to be a minimum 5-year operational commitment. As part of this move, you are revising your benefits options, updating the employees on the changes, revamping the intranet to include self-service benefits administration, and redeploying about 20 human resources benefits staff to new positions with the human resources department. The vendor that will be taking over benefits administration operations has not yet been chosen. Due to a lack of resources in the information technology department, a vendor will be used to update the intranet and train employees on the new self-service functionality. It is not yet clear how the redeployment of the benefits staff will be completed. In the past, this type of activity has been handled by a boutique management consulting company.
You just met with your boss, Pat, the Vice President of Human Resources. Pat emphasized that you will have responsibility for all the contracting, negotiating, and vendor management activities. You will need to work closely with purchasing and accounts payable as you complete these activities.

Prior to sending out the RFP, you determined that your vendor strategy was to work with the "best of the breed." If one company could provide all the services you needed and it had the expertise needed, you would go with that company. However, if you instead found a number of companies that had smaller but deeper areas of expertise, you would work with a larger group of vendors. The manager of the purchasing department agreed that it was okay to look at vendors that were not on the preferred provider list; however, they would rank those vendors lower.

You determined that you would use a point-based evaluation. The criteria you developed will be assigned a weighting and a number of points. Each vendor will be ranked according to the vendor's total number of points. You hope that this will make the process more objective and take some of the issues and personalities out of the decision-making process.
Describe your approach to the proposal evaluation. Attach a spreadsheet (in Excel) that lists the evaluation criteria you recommended previously and their weighting. Describe in the e-mail how the spreadsheet will be used, what the columns mean, and how the weightings are determined.

Explain the bid and proposal process to include preparing RFP requirements, evaluating bids, and contract formation.

Solution Preview

According to the previous discussion the criterion used for evaluation will be as follows:
This material is from the past posting: "
1. I will rate the delivery schedule, quality and service and balance it with the price of the services that are being provided by the vendor.
2. I will evaluate the origins of the services being offered by the vendor. I will give a positive rating to that vendors that provides services including software developed in the USA.:
3. I will evaluate the capabilities of the vendor with regards to delivering the solution any where in the USA. Do they have competent staff and personnel in place?
4. I will evaluate the connectivity of vendor especially with regards to the ability to provide tools, training and updates over the internet;
5. I will evaluate the standards, policies and practices that vendors have in place;
6. I will evaluate the experience that vendors have in providing HRM solutions;
7. I will examine if the vendor has executed successfully a benefits administration system on an intranet.

Corresponding to these six criteria the six criteria on the spread sheet are: ( the last two criteria have been clubbed together.

1. Delivery, quality, price
2. Origin of goods
3. Competence of ...

Solution Summary

This solution talks about vendor strategy in LRH Financial.. It then explores how vendor strategy will work to its best.