Fundamentals of Contractor QualificationMichael D’Aversa Manager | Cost Analysis Cherry Logistics Corporation

In the next 20 minutes…

• The Objective of Contractor Qualification• Strategic Considerations• Identification Scenarios• Qualitative and Quantitative Validation• Results

• Identify and validate a viable pool of qualified Facilities Maintenance contractors

• Aligned with your company’s specific needs• by trade specialty

• by geographic location

• Essentially available prior to having a specific need

• Having the potential for developing a sustained, long-term business relationship

The Objective of Contractor Qualification

Strategic Considerations

• Best time to evaluate a potential contractor

• Pre-relationship • Research

• RFI

• Dialogue

• Throughout relationship

• Direct providers vs. management companies

Identification

• Scenario: They find you• Lead generation vs. diligent, interested party

• Initial evaluation, RFI form, etc.

• Scenario: You have to find them • Internal reference

• Trade organizations

• Local chambers of commerce

• Non-competing local reference

• Internet research

Validation

• Quantitative• Establishment

• Competency

• Capacity

• Pricing/rate structure

• Risk management factors

• Qualitative• Dialog

• Visual evaluation

• That which is important though not easily counted or measured

Quantitative — Establishment

• Business structure

• Number of years in business• Current iteration

• Previous iteration(s)

• Number of years at location(s)

• Proximity• Potential time sensitivity

• Physical distance from provider start point(s) to site(s)

• Verifiable history of growth

Quantitative — Competency

• Licensing

• Degrees, certificates, etc.

• Verifiable training

• Past performance• Internal (vendor score, documented issues)

• External (BBB or other published rating data)

Quantitative — Capacity

• Concerns may vary by trade type

• Number and types of equipment• Trade-related

• Business-related

• Ownership of trade-related equipment

• Human Resources

Quantitative — Pricing/Rate Structure

• Buyer Perspective

• Seller Perspective

• Hourly rate information

• Quote on sample project

Quantitative — Risk Management Factors

• Insurance• Levels and types

• Endorsements

• Safety• Policies and procedures

• Record

• Litigation

Qualitative — Dialog

• Indicators of suitability• Experience matched to your business

• Clients/References

• Competitors

• Communicative ability• Likelihood of compliance

• Barriers to communication

• Intentional phone conversations and e-mail threads

Qualitative — Visual Evaluation

• Contractor facility visits• Verify equipment

• Observe conditions

• Observe staff

• Face-to-face meetings• Deeper dialog

• Clearer understanding

• Long-term suitability

Effective Contractor Qualification

• Strategic methodology• Pre-relationship and ongoing• Quantitative and qualitative validation• Our results

• Contractor pools in markets not yet served• Contractor relationships that span our 10 years in

business• Contractor turnover/termination rate < 4%

Additional Resources

• Search trade associations at www.asaecenter.org

(American Society of Association Executives)• Search complaints at www.bbb.org • Search litigation at law.justia.com and

www.leagle.com• White papers available on

www.cherrylogistics.com: – Emergency Response Case Study– Risk Management– The 8.5 Best Practices For Facilities Maintenance

Q&A

Michael D’AversaManager | Cost Analysis

Cherry Logistics CorporationMichaelD@CherryLogistics.com

PRSM Resources

White Papers: •Keys to Successful Request for Proposals•Vendor Relations Management

Best Practices Books•2012 Best Practices Book (Vendor Management and Communications)•2010 Best Practice Book (Vendor Management)