Considerations of Current and Emerging Transportation Management Center Data
Chapter 4. Procurement Strategies
When procuring data or services, agencies need to exert considerable effort to ensure proper communication of the agency's needs to bidders. When developing requirements for data, services, or both, two approaches are typically used:
Both of the options have their advantages; however, the second approach typically results in an end-state that is more favorable to the agency.
Well-written and well-defined requests for proposal (RFPs) state the agency's preferred business model, data use rights, and delivery mechanisms. Agencies that leave these out of their procurements open themselves up to potential misunderstandings as to what is delivered and what will be allowable. The private sector may try to propose alternative business models in procurements, but that opens the agency and private sector to risk.
The requirements for the use of specific technologies or techniques to collect and deliver data, however, should be left out of RFPs. Development of new technologies, methodologies, and tools happens both quickly and often, and requiring outdated technologies can result in artificial limits being placed on the agency and the consultant as they work to perform analytical tasks. It is generally better practice to allow data or service providers to drive these decisions based on what they perceive to be the most efficient and effective tools and methods at the time of delivery.
Agencies that procure new data or services via sole-source procurements usually do so because they have thoroughly defined needs, have evaluated what is available from the private sector, and have found only one potential provider that can meet all of those needs. Sole-source justification is a good procurement strategy when and if an agency is fully aware of all of the alternative solutions and data providers and there is a clear advantage of one provider's data over another. Sole-source procurements are often appropriate for truly emerging data sets because it is unlikely that multiple sources exist for the data.
Less competition for sole-source procurements does not necessarily result in higher prices for an agency. Sole-source procurements are significantly less effort for the private sector—thus lowering overall costs and overhead associated with developing proposals. The private sector is often more open to negotiating favorable terms for an agency with sole-source procurements.
Sole-source procurements present problems when an agency does not truly understand its own needs or what may or may not be available from other data providers.
Traditional Requests for Proposals
Traditional RFPs are usually challenging for both the agency trying to procure data and the private sector. For the public sector, RFPs can take a very long time to let and award. Technology and data offerings can change significantly in a short period of time, and what is documented and specified in the early stages of RFP development could be significantly out of date and even irrelevant by the time the RFP is awarded.
It is also very difficult to write a good RFP. Agencies face the following challenges:
Intergovernmental agreements (IGAs) are useful when an agency needs to obtain the data or the services of a public-sector university, wants to partner with another department of transportation (DOT) in another State, or desires to work with a quasi-governmental entity. The risks associated with IGAs are similar to those of sole-source agreements; namely, the agency must be sure that it is working with a provider that will meet all of its needs before going down this path. IGAs can also produce results at a lower cost because they are typically leveraging a resource that has already been vetted and procured or is being purchased in bulk.
Pooled Fund Study
Pooled Fund Studies (PFSs) are excellent ways to leverage the resources of multiple agencies to fund data and services from one or more providers. Agencies "pool" their resources (funds) to develop a scope of work and procure support. A single agency can administer PFSs on behalf of everyone else. While there is an increased level of burden on this lead State, the benefits are typically significant and far exceed the administrative costs. The work or data procured by a PFS can be sole-sourced or put out for bid.
Several benefits of PFSs include:
On-Call Consultant as the Procurer
Several agencies have leveraged their on-call consultant contracts to procure data or services for the agency. These types of purchases sometimes appear to circumvent the procurement process entirely; however, some agencies have effectively used these contracts in a reasonable and ethical way. For example, the City of Austin, Texas, recently had one of their on-call consultants procure realtime probe data and data analytics services on the city's behalf. The consultant put together their own RFP from which multiple private sector entities responded. The consultant then reviewed the responses in consultation with the DOT and chose a winner. The city essentially outsourced the entire procurement process to their consultant.
Procured as Part of a Larger System
There is a growing trend among some agencies to bundle data, analytics, and other services with the procurement of their advanced traffic management system (ATMS) or 511 platforms. While this makes sense if the DOT already knows exactly what data it needs and requests very specific data from a specific vendor in their RFP, the risks include:
United States Department of Transportation - Federal Highway Administration