QBS: What it is and What it's Not
It doesn't take an Einstein to determine that the lowest bid procedure for awarding design contracts rarely works out in terms of life cycle, customer satisfaction or even lowered costs. Although for years municipalities adhered to this policy, it was back in 1972 that the federal government took steps to require selection by qualification be performed on all federal or federally funded projects.
Click here to view: Don't Burn Any Bridges: A View From the Consultant's Side of the Table
"Qualifications-based selection" is the popular phrase, and QBS is the common acronym. The legislation became known as the "Brooks Bill" after Congressman Jack Brooks from Texas, where it is currently illegal not to use the process.
Shortly thereafter, the American Public Works Association (APWA) followed suit and began the task of educating its members and providing guidelines for this type of selection. These guidelines and instructions remain much in demand today since the term "qualifications-based selection" is more easily said than implemented.
The first document produced by APWA, entitled Selection and Use of Engineers, Architects and Professional Consultants (affectionately known as the Red Book), was immediately a best seller and has now been updated, expanded and undergone peer review. It remains the association's most requested publication. Past APWA President James L. Martin was the prime author of the book and one of the presenters at a recent videoconference.
QBS is a procedure that has met with approval by both public (the hiring side) and private (those being hired) concerns, and it is one that also was the topic of what was one of APWA's most popular video conferences to date. Held last August 19 at a record-breaking 87 down-link sites, it was a fast-paced, information-packed, almost five-hour session of expert information followed by lively question and answer periods.
Dag Knudson, P.E., president of the Institute for Effective Presentations in Lake City, Minnesota, kicked off the program, which was moderated by past APWA President Win Westfall. Knudson gave an overview of what QBS was and was not.
Basically, the QBS process involves four prime steps:
- determine the qualified firms
- conduct extensive interviews with the top three or four firms
- define the scope of services precisely and accurately
- retain a firm based on a mutually agreed-upon price
The first step involves identifying the most qualified firms for the individual project in question. Knudson cautioned that the value of a firm's qualifications need only match the project's specific need. For instance, a large firm is not necessarily needed if a small firm can provide the services sufficient to complete the particular project.
In identifying the firms to be considered, it also is important to review the firm's technical management and financial stability. Often an office or job site visit also is recommended. Another important step is to gather an interview committee of five to seven people representing all aspects of the project, including the internal project manager, technical experts, and the stakeholders.
In selecting the consultants, Dwayne Kalynchuck, AFWA board member from St. Albert, Alberta, Canada, and William Gray, director of public works from Urbana, Illinois, reviewed the criteria.
In discussing technical credentials, they emphasized the importance of the people involved. "Look at the firm's history and the qualifications of each staff member," they said. "Do they have enough trained people on the staff or will they have to go outside. If they go outside, you will need to look at the staff of the subcontractor with the same scrutiny."
The company's experience, usually derived from references both given by the individual and obtained by networking with peers, should reveal financial stability. Were they able to stay within budget and on time with other projects? It should also indicate past similar projects and how well-seasoned the supervisors are.
All presenters at the videoconference stressed the importance of teamwork and interpersonal skills. Does your staff get along with the consultant's staff? Is it a good mix? Are there too many strong-willed people who may present a problem? Is the project manager strong-willed enough to get the work done? What about the staff's loyalty? And is the staff excited about the project? All of these should be factored in when making a decision.
The stress on obtaining a good, strong project manager prompted several in the audience to ask what could be done if a project manager quit shortly after a contract was awarded. While there were no hard and fast answers, it was advised that such an instance be addressed upfront within the contract.
Other "tie-breaking" attributes to be looked at when determining a consultant include new ideas and innovative skills. On this point, it was generally recommended that a consultant's ideas not be shared with his competition. However, it might be appropriate for the ideas to be used once the work got underway. If there is concern about this issue, it was suggested that language be used upfront to make it clear that any ideas presented could become the property of the interviewer.
Still more attributes to consider include:
- compliance with legal requirements such as equal opportunities
- volume of work currently being undertaken by the contractor (It was suggested that most of the other work be at least 75 percent complete)
- if the firm is in litigation (Some municipalities actually prohibit awarding a contract to any firm that is in litigation.)
- ability of the firm to write and obtain grants
Other considerations are: whether or not the firm is local; how well its people handle public relations; and if there are any conflicts of interest involved in the awarding of the contract. All of these factors may come into play when a decision has to be made.
Once the firms have been reduced from the original number considered to three to five possibilities, the important interviewing process begins. It is important to maintain a level playing field, keep the interviewing focused and make certain all contingencies are discussed openly early in the process. These could include project coordination with local utilities, change orders, change of personnel, dispute resolution, public communication programs, etc.
Finally, a price is negotiated once a qualified firm has been selected. If agreement cannot be reached on price, a return to the scope of the project is suggested and correction of any misunderstandings is accomplished. Once both sides understand the project's scope, a fair and defendable price can almost always be achieved.
Don't Burn Any Bridges: A View From the Consultant's Side of the Table
By Darrel V. Holmquist
The goals of any interview process should be first and foremost fair, equitable and uniform. This assures that the best candidates are selected; other candidates are not offended and, thus, willing to work with you again; and the choice made is "defendable, should it be questioned. The following steps ensure the goals will be met:
- Pre-qualify your candidates. Do not waste your time or the candidate's time and money (it typically can cost $10,000 to $25.000 to prepare and make a presentation). If your goal is to find three candidates but can only find two qualified ones, change your goal to two.
- Give two to four weeks advance notification since some consultants may have to bring in people from out-of-town.
- Request a pre-interview submittal and stress brevity by limiting the number of pages.
- Provide ample time for each candidate to set up without running into competition, and supply adequate space and the equipment requested.
- Specify a certain desired composition of a team (types of staff) but do not specify names; and request the project manager always lead the team presentation.
- Always be consistent with your questions and requirements. Don't change in midstream and risk embarrassing your candidate. He may not be back.
- Prior to interview, request from the candidates: resumes of key personnel, insurance and financial papers, claims history and references.
- Include in your interview team your project manager; several technical people such as architects, engineers and project specific experts; non-technical people from fields such as public relations, accounting and affirmative action; and stakeholders.
- Prepare your interview team by having it review proposals, formulate questions, check references, and develop a scoring procedure.
- While interviewing, look for such things as: how well a candidate gets along with his staff, the degree of enthusiasm he shows for the project; the adequacy of his staffing; the number of years in business; litigation history; financial stability; and innovative ideas presented.
- Avoid discussing prices until after candidate is selected. Then the scope of project is defined and price negotiated. If the price is too high, chances are the scope has not been adequately defined. Don't forget the importance of life cycle costs.
- Finally, include specific discussions such as contract termination if the project manager leaves, and other contingencies.