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How Precise Does Language Need to be in Software Licences? – You be the Judge NECI

Does your organization hold software licences? This recent case from Quebec is a cautionary tale about ensuring that you include accurate wording about the scope of any licence, and consider and address the issue of revocability. Can the licence be revoked? If so, under what circumstances?     

In 1984, then-student Elizabeth Posada developed a DOS computer program called Ceres to allow users, such as university students or business executives, to vary certain inputs to produce reports and learn business concepts. In December 1984, Posada incorporated a company called Planification-organisation-publications Systèmes (POPS) Ltée, of which she is the sole officer and shareholder.           

In 2007, Posada joined long-standing friends Philippe Chapuis and Benoît Bazoge as a shareholder and employee of their company, 9054-8181 Québec Inc. (IDP). The three had been doctoral students together and all had used Ceres while they were professors or lecturers at the Université du Québec à Montréal (UQAM). (In 1989, for $2,000, Benoît Bazoge had purchased a user’s licence for Ceres on behalf of UQAM. Philippe Chapuis had done the same on behalf of the École Supérieure de Commerce in Tours in 1990.)           

When Posada joined IDP in 2007, she effectively ceased POPS’ commercial operations, and even gave IDP the right to use the POPS trade name. Posada was hired to develop the adaptations of and enhancements to Ceres that IDP wanted. She was responsible for completing work on the software called Omega – the Windows version of Ceres – on which she, Chapuis and Bazoge had collaborated since 1998, and for developing the software that would become known as Epsilon and Comex. These two were scaled-down versions of Omega.           

In October 2008, Posada resigned as a shareholder of IDP because of a dispute over compensation, and left the company. She demanded that IDP stop using Ceres, Epsilon and Comex. IDP refused, and POPS sued IDP. The case went to the Federal Court in April 2009.           

In its April 2013 judgment, the Federal Court found that copyright subsisted in the Ceres software products and subsequent versions, POPS was at least one of the rightful owners of that copyright, IDP had at least an implied licence to use the products (including access to the source code and future adaptations that IDP might develop), POPS was not entitled to revoke that licence, and IDP had not infringed POPS’ copyright, so was not liable for any damages.           

POPS appealed the judgment, arguing, among other things, that Chief Justice Crampton had erred in his decision about the revocability of IDP’s licence, as well as about the scope of it, claiming that, following Posada’s departure, IDP did not have rights to the software, all future adaptations, and the source code – including the right to modify the code.           

See below to discover how the Federal Court of Appeal untangled this case.

Answer

The Federal Court of Appeal decision in Planification-organisation-publications Systèmes (POPS) Ltée v. 9054-8181 Québec Inc., 2014 FCA 185, which ultimately found for IDP, reminds us again that litigation is a poor substitute for clear and unequivocal language in contracts and agreements. Perhaps a more subtle lesson is to maintain a firm focus on legal rights and responsibilities, even – and some would argue, especially – when entering into business arrangements with ‘friends’. Expect the unexpected and plan for the end of the relationship, as you would for any contract.           

Posada made several claims. Among them, she claimed that the trial Court had failed to apply the correct principles of law in determining the scope of the software licence, and that, with respect to IDP’s access to the source code, the trial Court had acted ultra petita, meaning that the Court granted more than IDP had asked for (it had not in fact asked for access to the source code, or the right to modify it). With respect to the revocability of the licence, Posada argued that the trial Court had made several errors in law – including not taking a systematic approach from English case law – and that it was not reasonable or fair for IDP to hold a non-revocable licence after Posada and IDP went their separate ways, since (Posada claimed) the licence had been conditional on IDP and Posada working together.           

The Court found that IDP had indeed never asked for access to the source code or for the right to modify it in the future, so it limited IDP’s software licence to all versions of Ceres, Omega, Epsilon and Comex that existed at the end of the IDP/Posada collaboration, without IDP access to the source code.           

With respect to the revocability of the licence, the Court rejected Posada’s argument that the trial Court should have followed English case law. The appeal Court instead used the ‘intention of the parties’ test that is the standard of review under Canadian law. The appeal Court found that the trial Judge had not erred in this, so reaffirmed the trial decision that the licence was non-revocable. Further, the Court found that a non-revocable licence was reasonable and fair, given Bazoge’s and Chapuis’ early purchase of licences to use Ceres, and their later investments of money and staff resources to develop the software. In the Court’s opinion, and in the absence of explicit language to the contrary in the agreement, the licence was not therefore conditional on IDP and Posada working together.           

Although the Court held that IDP was the primarily successful party, each party was responsible for its own costs. The appeal was dismissed, except for a revision to the wording of the trial Court’s decision with respect to the scope of the licence, and specifically to the source code. 

Reprinted from The Legal Edge Issue 109, January – March 2015

 

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As Cities Get Smarter, Security Concerns Get Bigger, Trend Micro Research Finds

By: Jessie Bur January 19, 2017 | 11:02 am

More and more cities are employing “smart” technologies to improve communication with the public and reduce the burden on government services, but these technologies also open those cities to security and privacy dangers, according to a Trend Micro article released on Tuesday.

“Smart cities are redefining the way we live and work. Blending cutting edge IoT (Internet of Things) technologies with virtualization, big data, cloud and more, they represent an urgent and ongoing attempt to overcome the challenges associated with rapid urbanization,” Ed Cabrera, chief cyber security officer at Trend Micro, wrote in a blog post. “There’s just one problem. These vast, interconnected technology systems also raise serious privacy and security concerns.”

According to Martin Roesler, director of threat research for Trend Micro’s Forward Looking Threat Research team, cities are particularly threatened by future IoT attacks because they pose an attractively visible target for hackers looking for maximum impact.

Continue reading →

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How Much Does Employee Turnover Really Cost?

Article By: Jack Altman. Co-founder / CEO @latticehq

People are companies’ most important assets. We’ve all known this for a long time, but 1) we pay it lip service more often than we try to do something about it, and 2) it’s true more now than ever.

The rise of technology and the information age has resulted in more companies that compete based primarily on their people. This isn’t only true for technology companies like Facebook and Google; as software continues to eat the world and the pace of business increases, nearly all companies will live and die by their continual ability to innovate.

Despite the fact that most organizations know that their long term advantage resides in their people, most companies don’t think critically about how to increase employee retention.

In this post, I’ll argue that the core reason people don’t think about employee retention seriously enough is because they don’t know how to measure the impact. I’ll then share some frameworks for how you might associate dollar values with regrettable turnover, and once I’ve (hopefully) convinced you that this matters, give you some actionable ideas for improving the state of affairs.

The problem with not measuring employee turnover

Employee turnover is expensive.

People instinctively sense this; we’ve all felt the pain of a superstar leaving, the cultural challenge associated with the departure of a beloved employee, or even just the painful gap that is left behind by an employee who was doing an important job well.

But most people have no framework for quantifying this cost, or they never even bother to try.

The problem with this is that people tend to optimize what they can measure. Doctors believed that cigarettes were bad for human health as early as the 18th century, and scientific studies about the link between smoking and lung cancer started surfacing in the medial literature as early as the 1920s. Even though people generally knew cigarettes were bad for you, it wasn’t enough, and smoking in America surged dramatically during the first half of the 20th century.

So what was the solution? In 1964, the first Surgeon General’s Report on Smoking and Health linked smoking to lung cancer and heart disease. This landmark report laid the foundation for the next 50 years of public education about the negative effects of smoking, and the results have been dramatic:

Source: Data from Centers for Disease Control and Prevention

The U.S. government started running extremely effective public service campaigns over the following decades about the number of years cigarettes shaved off your life, the specific diseases you would contract and how likely you’d be to get them, and the effects on loved ones who are exposed to your second hand smoke.

In order to help people to do something difficult but valuable, such as quitting an addictive habit, a critical first step is to help them understand the cost of not doing that thing.

Understanding the quantitative impact of employee churn

Employee turnover, like cigarettes in the 1920s, is generally understood to be bad, but there is little awareness of its quantifiable impact.

A visual way to gain a mental framework for the cost is to simply draw a graph of an employee’s value to the company over time.

Maia Josebachvili, VP of of People at Greenhouse, produced a case study where she argued that retaining a sales person for three years instead of two, along with better onboarding and management practices, yields a difference of $1.3 million in net value to the company over a three year period.

Slightly more conservatively, Josh Bersin of Deloitte believes the cost of losing an employee can range from tens of thousands of dollars to 1.5–2.0x the employee’s annual salary. These costs include hiring, onboarding, training, ramp time to peak productivity, the loss of engagement from others due to high turnover, higher business error rates, and general culture impacts.

Employees, Bersin explains, are appreciating assets that produce more and more value to the organization over time, which helps explain why losing them is so costly.

Source: Employee Retention Now a Big Issue: Why the Tide has Turned

Others sources peg the cost of regrettable employee turnover at a higher level. A paper from the Center for American Progress, citing 11 research papers published over a 15-year period, determined that the average economic cost to a company of turning over a highly skilled job is 213% of the cost of one year’s compensation for that role.

No matter how you slice it, the cost is high. But how high is it for you?

How to calculate your own cost of turnover

To help you quantify this, we’ve put together a simple formula: your company’s cost of employee turnover is equal to the number of regrettable departures times the average cost of those departures.

The number of regrettable departures will simply equal your number of employees times your annual turnover percentage.

While we can’t capture every single expense, or even some of the big intangible costs like impact on employee morale, we can get a good sense by analyzing four major buckets:

  • Cost of hiring
  • Cost of onboarding and training
  • Cost of learning and development
  • Cost of time with unfilled role

So we can now describe your overall annual cost of turnover to be:

As an example, if you are a 150 person company with 11% annual turnover, and you spend $25k on per person on hiring, $10k on each of turnover and development, and lose $50k of productivity opportunity cost on average when refilling a role, then your annual cost of turnover would be about $1.57 million.

Reducing this by just 20%, for example, would immediately yield over $300k in value. And that says nothing of the emotional headache and cultural drain felt from losing great people.

You can use this spreadsheet to plug in your own numbers to get a sense of what the costs look like for you.

How you can address employee churn

Alright, so we know it’s expensive. But what can be done?

First and foremost, acknowledge that there are some problems that you can solve by throwing money at them, but employee satisfaction isn’t one of them. Multiple studies show that while under-compensation can definitely contribute to employee churn, over-compensation won’t make up for a bad workplace. Your well paid but unhappy employees will simply leave you and make their money somewhere else.

Instead, focus on growth, impact, and care

So view market-rate compensation simply as table stakes, and spend your energy focused on the next level of Maslow’s hierarchy of employee happiness: opportunities for growth, the ability to have impact towards a purpose, and a caring environment that makes them feel valued.

  1. Growth

Growth is fundamental to human happiness; the hedonic treadmill was built into all of us, and humans constantly seek growth and change.

The craving for growth is especially visible for the younger generation that is coming to dominate the workforce. Younger workers are more easily able to prioritize things like personal growth and career opportunity over income and job security.

Giving your employees authentic opportunities for growth is something you have to build into the fabric of your company. Here’s a few questions to ask yourself to check whether you’re on the right track or not:

  • Have you had conversation with your employees about their long-term personal goals?
  • When a capable person on your team wants a role bigger than her past experience, do you give her a shot or do you simply hire someone with more experience?
  • When people need to acquire new skills to advance their careers, what does your company do to help them?

If you don’t build a culture that deliberately provides good answers to these questions, it’ll be a matter of time before your employees start looking for a workplace that does.

  1. Impact

Impact applies at two levels; the impact your company is having on the world, and the impact an individual is having on your company.

People want to know that what their company is working on matters. Articulating a clear and purposeful company mission is important not just because it help people prioritize their work, but because it helps them keep going through hard times and know they’re part of something that matters.

To give a tangible sense of impact, they need to know that what they’re working on is contributing to a mission that matters. If someone builds and launches a new product they will certainly feel some satisfaction, but if they can say, “I built a new product which is going help our company accomplish a much broader mission” that will mean much more to them.

  1. Care

Finally, and just as critically, is creating a workplace that cares.

Feeling cared for and recognized addresses another basic human requirement; the need for human relationships and for others to acknowledge to us that we matter to them.

You need to build a culture where people respect and appreciate each other.

A culture of care and appreciation doesn’t mean throwing around constant, meaningless praise. Instead it’s an authentic care for others’ best interest, which can’t be faked and has to be built over time.

An environment where people feel like their coworkers have their best interests in mind comes with all kinds of benefits. Critical feedback will be more easily accepted. Frank conversations about what’s required for employees to make it to the next level will happen more naturally. Managers will want to see their teams succeed and work hard to empower them.

And, of course, employees will feel happier on a day to day basis knowing they are surrounded by people who don’t just want something out of them, but want something for them.

Final thoughts

In a world where people are an organization’s most essential assets, companies need to be more strategic about how they think about employee retention to remain competitive.

Employees are just humans who happen to be at work. You’ve hopefully learned some ways to make other humans happy in your personal life, so take that knowledge and apply it to your workplace.

Once the basic need of sufficient income and job security has been met, move up Maslow’s hierarchy of needs and create a culture that enables growth, impact, and care. It’ll save you a ton of money, help you stay competitive in your industry, and make the place you spend most of your waking hours much more enjoyable.

Enjoy reading? Click the little heart below to help spread the word!

Jack is a co-founder at Lattice, a performance management service that helps companies retain and motivate their employees

Thanks to Alex Kracov, Eric Stromberg, Connor McSheffrey, Jarred Sumner, and Ming Lu.

 

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2016 Social Media Glossary of Terms

226 Essential Social Media Definitions

By Dara Fontein

A lot can change in a year, especially in the world of social media. It can be difficult to keep up with all of the terms and slang used with the introduction of new technologies and platforms, so we decided it was time to update our Social Media Glossary. Like previous editions of the glossary, this is a living document that will continue to grow as we add more terms and expand our definitions.

This Glossary is produced annually by Hootsuite and it’s a handy tool for those who use social media.

See the Glossary

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Should Santa Sue? You Be The Judge.

Even Santa has to carefully manage risk and ensure that his contracts deliver the promised terms on time and on budget! Here is a holiday tale emphasizing the importance of having a clear and well-structured risk allocation clause, particularly for ‘mission critical’ contracts.

Upon return from their annual Mexican vacation in early March, Santa and Mrs. Claus began planning for the next Christmas Season. One issue they knew needed immediate attention was reindeer succession planning: Rudolph was only three years away from his full pension, and Donner and Blitzer were both planning to retire after the upcoming Christmas flight.

After doing some market sounding to determine whether there were any new reindeer providers in the market, Santa turned to his regular reindeer supplier – Arbutus Sled Accessories Ltd. (“Arbutus”). In recent years the demand for reindeer has been in decline, and there appear to be no new companies entering the market. After some initial discussion, Santa agreed to buy 57 reindeer from Arbutus.  Read what happened next.

Should Santa Sue?

Thanks to our member NECI and The Legal Edge for sharing this seasonal tale of procurement risk management with us!

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Merry Christmas & Happy Holidays from muniSERV – Municipal Newsletter

This December Newsletter includes lots of free tools for municipalities:

  • Free Webinars from Juice Inc.,
  • Free Public Sector Procurement Assessment Tool from NECI (National Educational Consulting Inc.),
  • Interesting articles and,
  • Introduction to our newest Professional Members

See our December Municipal Newsletter

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Top 10 Rules for Successful Responses – Requests for Proposal (RFP) 101

RFP’s can be lengthy and sometimes confusing documents.

The following Top 10 Rules are intended to assist in understanding RFP fundamentals, so as to increase your probability to succeed, and, even more critically, avoid disqualification.

A Request for Proposal (RFP) is simply a formal document which fundamentally asks, “Explain to me how you will provide me with a good and/or service, and at what price”.

Typically, the RFP is seeking information from Respondents (those who provide proposals in response to an RFP, sometimes also called Proponents) which communicate the following:
(1)  I will meet the MANDATORY REQUIREMENTS  to provide the goods and/or services desired;

(2)  I am the BEST person/company to provide the goods/services for the BEST VALUE (Price),   (EVALUATE MY RESPONSE).

(3)  If you determine that I’ll meet the MANDATORY REQUIREMENTS, and I’m EVALUATED as the BEST respondent, I’m willing to enter into a CONTRACT with you, (most often to be substantially similar to the one attached to the RFP.)

Both the issuer of the RFP, and the Respondent, must follow a formal PROCESS, described in the RFP document, in order for the RFP response to be evaluated.
Organized into the 3 areas above, (MANDATORY REQUIREMENTS, EVALUATE, CONTRACT) plus the 4th, PROCESS, the following top 10 rules will substantially increase your probability of success. Let’s begin with PROCESS.

PROCESS

1. Read the PROCESS section(s) of the RFP FIRST and follow the process precisely. Sweat the Small Stuff: note and meet deadlines precisely, ask clarification questions by the indicated timelines, prepare your response in the format requested, answer all questions, and ensure authorized signatures are provided.

2. Part of the process often has a timeline for asking clarification questions: This is the time to in particular seek any clarification on “musts” or “mandatory requirements” – are these truly mandatory?

3. If there is a bidder’s meeting where questions are being asked, consider going to it to learn more about key issues and questions, and who your competitors might be. At a minimum, be sure to review Q’s and A’s from the meeting, which will more than likely be sent out to all respondents.

4. Once you have completed your response, check to see that your response is complete, and accurate.  It is not uncommon for responses to be disqualified because the response did not have an authorized signature, or because an Appendix (like the Price Table) was omitted when sending the response, or where other requested information was simply missing. If the response is being submitted electronically, follow up to ensure it was received.

MANDATORY REQUIREMENTS  – Can I meet the Mandatory Requirements?

5. Next, read the RFP and note all areas where the word must is indicated, and/or where the RFP states that there are mandatory requirements.  If you do not communicate back that you can meet all mandatory requirements and/or deliver on the musts, your submission will be disqualified – no matter how strong you think the rest of your response is.  Not sure if a requirement is really mandatory? See 2. above, be sure to ask before the clarification question deadline.

EVALUATE- How can I communicate that I’m BEST?

6. Do some research on the organization that prepared the RFP. What are their overall business problems/issues? What are the values/ethics of the organization? Who is on their Board of Directors? If possible, determine who will be evaluating the responses? What do you know about the incumbent supplier and their strengths and weaknesses?

7. Draft your proposal response:

• In the format requested;
• Answer all questions precisely;
• Be sure to address open ended questions, such as “your response should……”.

Your response should at the same time incorporate what you learned from step 6, above, and should be written so that it “hangs together “ –  as an overall proposal to address the “big picture” overall business needs.

8. How much should I write?

• Consider mark weighting carefully – you want to provide greater content length and breadth in areas where you can score the most marks, and taking into consideration 6. above;
• Be careful to include in your proposal the overall answer to the question, “how am I going to fulfill your needs”?
• Provide detail only in areas that are marked highest, and where detail is needed as evidence of a feature or capability. Consider using appendices for details.
• Focus on what’s important – you don’t want to put evaluators, who are reading multiple responses, asleep! Not helpful to include reams of general promotional material, for example, if it doesn’t relate to questions asked or to the overall product or service required.

9. Your Price bid should be:

• Competitive, based on your knowledge of the marketplace.
• Provide Value for Money and be realistic – consider the quality of your goods and services, and the weighting of Price in the RFP.
• Sustainable for you, based on your internal cost and margin characteristics;
• Firm, unless otherwise stated in the RFP, you likely will not be able to renegotiate it during contract finalization.

CONTRACT

10. Read the sample contract attached to the RFP and note any language stating “must” or “mandatory”, then refer back to 2. and 5. above to clarify. Overall, once this step is completed, you should be generally comfortable with negotiating a contract substantially similar to that attached to the RFP.

About the Author
Joseph Manner, now principal at JDManner Consulting, has over 15 years of experience in both drafting RFP’s,  and in evaluating RFP responses, from his experience as Director, Store Network Planning at the Liquor Control Board of Ontario (LCBO), and as the Manager, Alternative Service Delivery and Procurement, with the ServiceOntario Project, Government of Ontario. Joe can be reached at [email protected].

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7 Attributes of Extraordinary Coaches

By Jim Clemmer

If you buy a little goldfish and keep it in a small bowl it will remain no bigger than a few inches long. Move that same fish to a large aquarium and it will double or triple in size. Put the goldfish in a large pond and it can grow up to a foot long! The biggest factor that determines the size of the fish is the size of its environment. And so it is with people.

Many managers see people as they are and treat them according to what they see. A less effective manager would take a small goldfish and keep it in the little bowl because it would be inefficient and wasteful to put it in a larger environment.

Outstanding coaches, however, see people as they could be and work to grow that potential. Our research shows that extraordinary coaches share these attributes:

  • Caring deeply about the coachee’s progress
  • Believing people can grow, change, and improve
  • Focusing on the future
  • Showing interest beyond immediate job performance
  • Allowing solutions to come from the coachee
  • Having more frequent, shorter conversations
  • Supporting and encouraging

How many of these attributes describe your coaching or the coaches in your organization?

Click here Keys to Extraordinary Coaching for a two minute video clip of me presenting and explaining these points.

Have you ever experienced a leader who’s very strong at coaching and mentoring but doesn’t get results? People feel great working with him or her, but the job doesn’t get done. What’s the likelihood this leader would be rated in the top ten percent of leaders?

How about a leader who is very good at getting results — he or she really delivers — but not much of a coach? How likely is he or she to be rated in the top 10 percent of leaders?

Research based on over 250,000 360 assessments of roughly 25,000 leaders shows that either of the above combinations produces leaders in the 90th percentile less than 10% of the time. How often do you think a leader who is strong at both energizing people to achieve results and coaching and mentoring others is rated in the top 10% of leaders? Hint; it’s much higher than most people realize.

Click on The Impact of Coaching Effectiveness for a three minute video clip where I present the research behind this powerful combination and how dramatically these two competencies turbo-boost a leader to the very top. You can then see the dramatic impact of coaching skills on turnover, engagement, discretionary effort, and leader satisfaction.

No other leadership behavior is more correlated with increasing employee engagement than a leader’s coaching effectiveness. Outstanding coaching skills rocket leaders to top-tier effectiveness.

Many crazy-busy, frenetic managers believe it’s a trade-off: “Either I deliver results (often by micromanaging and pushing hard) or I coach and develop people. Which do you want me to do?”

Highly effective leaders get results through people. They understand that peak performance comes from empowering, energizing, focusing, and developing people to their highest potential to own and deliver outstanding outcomes.

Reprinted with the permission of Jim Clemmer. For over three decades Jim Clemmer’s keynote presentations, workshops, and management team retreats, and seven best-selling books translated into many languages, articles, blog, and newsletters have helped hundreds of thousands of people worldwide. The CLEMMER Group is Zenger Folkman’s Canadian Strategic Partner, an award-winning firm best known for its unique evidence-driven, strengths-based system for developing extraordinary leaders and demonstrating the performance impact they have on organizations. http://www.clemmergroup.com

 

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Municipal Procurement is More Than Just RFPs

Over the past few months we were out at a number of municipal conferences and events and it always surprises me to hear the number of folks who think municipalities are only able to procure goods or services via the RFP (Request for Proposal) process. They express their dislike for the process and they report the process discourages many small and medium enterprises from attempting to find work in municipalities.

No doubt, in the municipal sector procurement is a dynamic, sometimes complex process. However, what many are not aware of is that there is a variety of procurement methods available to municipalities to procure the goods and services they need.

The procurement of consulting and professional services still must be a competitive process but whether you’re a large company or a small or medium consultant or professional enterprise, it is still possible to acquire work in municipalities without ever needing to respond to a RFP.

In Ontario, Canada, municipalities must comply with the procurement requirements set out in the Municipal Act, 2001, S.O. 2001, Chapter 25, Section 270(1) 3. The legislation requires municipalities to develop policies to be adopted on the types of procurement processes that will be used, the goals of each, the circumstances under which each type will be used, and the circumstances where a tendering process is not required. 

Here are some of the procurement methods municipalities can employ to procure goods and services.

  1. Request for Proposal (RFP) – used to solicit solutions for the delivery of complex goods, services or construction for obtaining unique proposals designed to meet broad outcomes to a complex problem or need for which there is no clear or single solution.
  2. Request for Tender (RFT) – used to acquire goods and services based on stated terms and conditions and for obtaining competitive bids based on precisely defined requirements for which a clear or single solution exists.
  3. Request for Quotation (RFQ) – is where the municipality specifies the product or service and the criteria is based solely on price. The goals are the same as for Request for Tender, except that bid solicitation is done primarily on an invitational basis from a pre-determined bidders list – but may be supplemented with public advertising of the procurement opportunity.
  4. Request for Expression of Interest (RFEI) – is a procurement used to determine the interest of the market place to provide goods or service(s) which the agency is contemplating purchasing.
  5. Request for Information (RFI) – is a request used as a general market research tool to determine what goods and services are available that may meet business/operational requirements and acquisition strategies. 
  6. Request for Pre-Qualification (RFPQ) – is a procurement document used to solicit financial stability, technical information, product or service suitability from potential vendors and measured against stated evaluation criteria. Successful vendor(s) are pre-qualified or short listed to bid on specific categories of work or provide specific types of goods or services, or respond to a particular RFP or RFT
  7. Informal, Low Value Procurement – used to obtain competitive pricing for a one-time procurement in an expeditious and cost-effective manner through phone, fax, e-mail, other similar communication method, vendor advertisements or vendor catalogues.
  8. Non-Competitive Procurement/Invitational Competitive Procurement – in some circumstances, competitive procurements are not required. Municipalities can invite three or more qualified suppliers to submit written proposals to supply goods or services as specified by them. The goal is to allow for procurement in an efficient and timely manner without seeking competitive pricing.

Non-competitive procurement includes sole sourcing and single sourcing.

Sole sourcing is the procurement of goods or a service that is unique to a particular vendor and cannot be obtained from another source. Single sourcing is the procurement of goods or a service from a particular vendor rather than through solicitation of bids from other vendors who can also provide the same item.

Single sourcing may be the best course to take in some circumstances but it is important for the municipality to be transparent about what those circumstances will be.

Typically, non-competitive procurement is used in the following circumstances:

  • when there is a statutory- or market-based monopoly on the item
  • when no bids were received in a competitive process
  • when the required item is covered by an exclusive right such as a patent, copyright or exclusive license
  • when the purchase is already covered by a lease-purchase agreement where payments are partially or totally credited to the purchase
  • when it is necessary to ensure compatibility with existing products or to avoid violating warranty/guarantee requirements when service is required
  • when the required item is in short supply due to market conditions
  • when competitive sourcing for low value procurement would be uneconomical or would not attract bids
  • when competitive procurement may be found to be impractical for such items as meal expenses, incidental travel expenses (e.g. taxi service, phone calls), and training and education expenses
  • when an urgent procurement is necessary for fulfilling a statutory order issued by a federal or provincial authority, such as an environmental, public health, or workplace safety compliance order.

To procure consulting and professional services in particular for larger more complicated projects, municipalities will still tend to use the RFP method. But for the smaller projects municipalities can, and do employ other procurement methods, such as the informal low value and non-competitive methods when possible.

Often they have no choice but to use these two methods to procure professional services because they simply cannot find enough consulting and professional enterprises to acquire the number of quotes they need to satisfy the requirements in their procurement by-laws and policies.

So, if you’re a consultant and/or a professional who would like to find work in municipalities – don’t give up. There are opportunities for you that do not involve wasting endless hours filling out an RFP only to find that on the 99th page of the 100 page document, there is one requirement you can’t meet.

Helping municipalities and professionals connect is the best way I know of to enhance the municipal procurement process and connect the municipalities and professionals that are trying to find each other.

Simple right?

Note: “In-Procurement”, a procurement magazine in the United Kingdom, published Susan’s article in 2016.

Susan Shannon is the Owner/Principal of www.muniSERV.ca.  Her experiences as both a municipal Chief Administrative Officer (CAO) and as a municipal needs specialist prompted her to create muniSERV. Her passion continues to be to find ways to “Help Municipalities & Professionals Connect”. She can be reached at [email protected].

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Update on our Partnerships in Procurement – Bridging the Buyer/Vendor Gap Presentation

As some of our members know our partners, bids&tenders invited muniSERV.ca to speak at their users’ group meeting for public sector buyers on October 13th, 2016 – and we invited Keith Strachan, of SellToPublicSector.com to co-present with us.  We asked our members for some common bidder issues they’ve experienced when responding to RFPs – and we got some great ones from you – Thanks!  This is the update we promised to provide to you after the session.

The attendees included buyers from the municipal, healthcare and school sectors. The municipal buyers were from small, medium and large regional municipalities which provided a good cross-section of procurement perspectives.

We shared some of the common bidder issues we heard from you and then asked for feedback from the buyers in attendance. Here’s our presentation slides.

The attendees were very engaged and offered great feedback and solutions to the issues we raised on your behalf.  Here are just a couple of them:

Finding Public Sector Opportunities – A small consultant whose services are usually less than $20,000 may not find many opportunities on public tendering websites.  How do they spread the word and/or where do they post opportunities that fall below their RFP thresholds?

Buyers’ Response:  School boards and Hospitals have mandatory posting requirements for all projects and they all must be through a mandated competitive process.

Municipalities reported they have a difficult time addressing this because there is really no one place to post them. Some hold Vendor Days where they will invite vendors to come in and they will provide them with a list of all upcoming smaller projects.  Still others only circulate them to a list of their preferred vendors in order to save time.

Take Aways: 

muniSERV: We will be actively encouraging municipalities to post, not only their RFP documents, but now also any invitations to bid on these smaller projects, which typically are consulting and professional services.  

Consultants:  Check municipal websites for any upcoming Vendor Days and participate in them.  Also investigate how to become a preferred vendor in the municipalities in which you’re interested in finding work.

Complying with Requirements – Do you really need $5m insurance coverage?

We gave the example of a muniSERV professional who wanted to respond to an RFP for graphic design work but the RFP requested they have $5m insurance coverage, WSIB and a lot of requirements that didn’t seem to fit the small project.  They ended up not responding because they simply could not meet the requirements.

Buyers’ Response: Municipalities need to ensure they have all the bases covered so their legal and risk management teams will include the full standard requirements in the RFP document.  However, if the requirements appear unreasonable for the specific project, vendors just need to call the municipality and bring it to their attention.  The purchasers then will ask their legal and risk management teams to review the requirements and most often they will agree and reduce or eliminate the requirement all together if it’s not imperative or mandatory for the specific project.  If this happens they will then issue an addendum to the RFP to notify vendors of the reduced requirements.  

Take Aways:

muniSERV:  It is interesting to note vendors can make this kind of request and/or that buyers would alter their original requirements, if deemed appropriate. 

Consultants:  If some requirements seem unreasonable for a project you want to respond to don’t be afraid to ask the municipality to reconsider them. You may not need $5m insurance after all! 

Thanks again to all those who took the time to help us!  The presentation would not have gone as well as it did without your input!
 

Thanks too, to bids&tenders for the opportunity to present your bidder issues directly to the public sector buyers so we could learn from each other and continue to Bridge the Buyer/Vendor Gap!

 

Susan Shannon, Principal muniSERV.ca

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