building bidding consortia
DESCRIPTION
With growing pressure on public bodies to commission more effective services and reduce budgets, third sector partnerships and consortia are often viewed as an answer. Find out about common models, examples and recipes for success drawn from Locality’s work with members who are building bidding consortia.TRANSCRIPT
Outline of session
why bidding consortia?
what do they look like
how to go about it
1, Why bidding consortia?
Language
POLL: Reasons for choosing this session;
-I am thinking about developing a consortium-I already am developing a consortium-I already work in an established consortium-I support others to do this
Context – external factors
• Budget squeeze
• Efficiency drive & perceived
‘economies of scale’
• Public service reforms
• Improving outcomes
• Increasing demand & changing
demographics
• Targeting resources
Context
• Budget squeeze
• Efficiency drive & perceived
‘economies of scale’
• Public service reforms
• Improving outcomes
• Targeting resources
& a changing picture for many third sector organisations
Growing /
shrinking
market?
Competition
Profitability
?
Clients’ needs
increasing /
more
complex?
Changing
policy
nationally &
locally
Geographic
coverage
Innovation
Payment
by results
New
market
entrants
Fewer
grants
Social
investment
What do commissioners want?
• Single contract point & clear lines of responsibility
• Certainty of quality of delivery throughout supply
chain
• Competitive on price
• Strong risk management
What do commissioners want?And…
• Pushing the money to front line delivery
• Social Value / Innovation
• Input into service design
• Delivery of outcomes (less prescriptive service specs?)
• Confidence that awarding decisions won’t be challenged
• Not to have to make difficult decisions about who they don’t fund?
Questions
2, What do they look like?
Types of collaboration
Cooperation Coordination Collaboration
Lower intensity Higher intensity
What will it entail?
Cooperation Coordination Collaboration
Resources, difficulty, time & risk
Who might be involved?
Third sector
Public sector
Private sector
Poll – what is driving your interest in bidding consortia?
-an upcoming specific opportunity-no immediate opportunity but to position ourselves for the future-something else!
Success factors?
A mixture of Hard and Soft factors
PaperworkAgreementsStructuresProcessessystems
PeopleRelationshipsPersonalities
Different models involving multiple providers
• Formal consortium (incorporated at point of
delivery) in response to specific bid (e.g. JVC)
• Permanent consortium / Super Provider
Informal /
Unincorporated
Formal /
Incorporated
• Managing Provider and subcontractors
• Managing Agent and subcontractors
Structures for consortia
Lead bidder
Subcontractor 1
Subcontractor 2
Subcontractor 3
Deliveryof Contractsand Services
Structures for consortia
Special purpose vehicle
Subcontractor 1 Subcontractor 2 Subcontractor 3
Delivery of contracts and services
Structures for consortia
Central hub –standing consortium
Member
Delivery of contracts
and services
Member Member
Member
Member
Member
Member
Member
MemberMember
Delivery of contracts
and services
POLL: What are you looking to get out of consortia?-access larger contracts-improve services-access specialisms you don’t currently have-expand delivery-something else
Questions
3, How to go about it
a. is it right for me?
b. intelligence gathering
c. building it
Risks
Mission drift
Time & resources
Commitment & energy
Reputational risk
Financial
Changing relationships
Performance management
Sparks for consortia
• Opportunity to improve
• Crisis
• Bigger contracts
• Fewer grants
• Join up services
• Can’t do it on your own
• Savings / efficiencies
• Take on a new service
• Generate new revenue
Adding value through consortia
Your strengths Your weaknesses
Partners
PartnersPartners
Partners
Know the right people!
-Stakeholder mapping
-market positioning of consortium
-profile raising
Know each other!
Partner mapping
• Vital to get to know partners
• Process of due diligence
• Trust based on openness and knowledge
• The more in-depth the partnership = the greater the
mapping
Mapping partners – due diligence
Leadership
Size
Geographic Coverage
Fin
ance
s
Potential
partner
Knowing the needs and selecting partners
Intelligence gathering
• Contract readiness & Procurement experience
• Organisational information
• PQQ
• Size (turnover of £45k and 1.5 staff to £245m and 8,000 staff)
• ITT Information
• Areas of delivery – specialisms/service/product
Poll - what are your current barriers to building bidding consortia?
-find the right partners
-finding the right opportunities
-finding the investment
-knowledge, skills and tools to make it happen
The laws of group development
Questions
The building process
• Complexity• Time• Support
How to build a bidding consortium
The cogs to make it happen
Formal agreement
Business caseResources
Shared vision & purpose
Structure
Momentum
Processes
Trust
Finding the right
partners
How to build a bidding consortium
The cogs to make it happen
Shared vision & purpose
• Where are you heading to• Vision, mission & aim• Clear purpose
How to build a bidding consortium
The cogs to make it happen
Formal agreement
Partnership agreement of similar
• Vision
• Purpose
• Ownership
• Governance
• Responsibilities
• Investments
• Recruitment
• Restrictions
How to build a bidding consortium
The cogs to make it happen
Trust
VitalYour reputation & brand is at stakeTakes time
How to build a bidding consortium
The cogs to make it happen
Resources
Time (lots of it)Money?Ongoing commitment & adminCapacity building of less contract ready patners
How to build a bidding consortium
The cogs to make it happen
The business case
Has to stack upNeed opportunitiesNeed ROI at some point
How to build a bidding consortium
The cogs to make it happen
Momentum
Who is going to drive it forward?What about the day job?
How to build a bidding consortium
The cogs to make it happen
Processes
Who does whatHow are decisions made?Managing quality
Yes
No
No, not bidding
Yes, 1
Reply by email required
Will be part of bid task group
Tender identified by consortium member
Member interested in consortium
bid?
Member = Lead bidder?
No, but bidding
separately
Email required to coordinating group if member bidding on
own or as part of other consoritum
Yes, 2 or more
1 member becomes leadof bid task group
Coordinating group uses mapping to highlight proposals to general membership
1 member chosen leadof bid task group
Full membership majority vote
Processes for a consortium bid
• Will you/others hedge your bets?
– How will you manage partners who might want to bid separately or as part of
another bid?
• How will you convince the commissioner?
– Minimise risks
– Assure commissioner your partnership is robust and necessary
• You will need time & resources to pull together bid
– Deciding on supply chains
– Harvesting information & data
Processes for a consortium bid
The PQQ
• Who will write & submit it?
– Level of risk taken by lead
• What evidence and policies do you need?
• What if you are not shortlisted?
Processes for a consortium bid
The ITT
• Who will write the tender?– Which organisation?
– Which individual?
• Method statement– How will you decide who delivers what?
– Who will receive what £?
• sub-contract agreements
How to build a bidding consortium
The cogs to make it happen
Structure
Important, but form should follow functionWhat about new partners?Different options & variants
How to build a bidding consortium
The cogs to make it happen
Formal agreement
Business caseResources
Shared vision & purpose
Structure
Momentum
Processes
Trust
Finding the right
partners
A business case for the consortium
Questions
