Sealed Bidding (IFB) Process vs. Negotiated (RFP) Process

The negotiated process is the better alternative within this particular situation. The company possesses a competitive advantage that is not easily duplicated by competitors. For one, the company has an outstanding reputation and exceptional problem solving skills. Competitors entering the market don't have a reputation for success as this company does. As a result, the negotiated process allows for the company's advantages to be utilized effectively in a manner that can benefit both the company and its constituents. The goal of the negotiated process is to select the best available candidate within the overall pool of applicants. The potential candidate should demonstrate the ability to meet scheduled demand while providing a quality product that meets customer specifications. The most effectively method to determine this is through historic performance. Since this company retains a superior reputation within the market it has the best historic performance measurements. This provides a marginal benefit over competitors bidding for the same contract.

Within the construction industry, quality service far outweighs cheaper production. Customers don't want low quality providers who provide subpar service. Although cheaper, this service will ultimately lead to more expenses born on the part of the customer. The majority of these expenses come in the form of extra labor costs and redesigns to fix recurring problems due to low quality.

Instead, quality, and value is of the utmost importance within the construction industry. The negotiated process allows companies to reinforce their credentials to better obtain funding. In addition, the negotiated process is more of a collaborative effort on the part of all stakeholder involved. Both the contractor and the designer are assembled earlier resulting in more efficient operations. Since the company is well regarded within the construction industry and possesses prior experience, the process will also be more efficient. The sealed bid process, however, doesn't allow for such a convenience. In actuality, a sealed bid process will favor the company who may not be the best available candidate. Through the negotiated process the company can create a model that best serves the interests of the team in achieving the most successful project.

References

1) "Successfull RFP's in Construction - MGH-0071449094." NorthWest Builder's Network, Inc. - the Builders MarketPlace. Web. 05 May 2011. .