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Modernizing UC San Diego’s Approach Toward Investing in a New Financial System

It’s no secret that UC San Diego has historically avoided conducting Requests for Proposal (RFPs) for high-value goods and services. The RFP process has been cumbersome due to the requirements to demonstrate fair competition among potential bidders, so avoiding it was understandable. “More is better” has been the approach, with RFPs that included hundreds of questions and vendor responses resembling a textbook for Philosophy 101. Evaluating the vendors’ bids scoring the hundreds of requirements, across numerous proposals was a daunting task. While the traditional request process may have been “fair”, it’s questionable whether it was meaningful or actually generated the best results for the university.

Improving a process

Based on the knowledge that the introduction of meaningful competition does genuinely lead to measurable reductions in pricing, UC San Diego’s Integrated Procure-to-Pay Solutions (IPPS) was among the first in the UC system to introduce a fully electronic bid management system. The system was a game changer in terms of making all information associated with RFPs open and transparent. It also greatly improved the evaluation process, as questions could be weighted and scored electronically. IPPS repositioned a staff member within procurement to specifically manage the bid process on behalf of the campus. The move has increased not only the number of RFPs being submitted, but we’ve also seen the associated financial benefit, based on the increase in competition.

Considering a new approach

The procurement of the new financial system presented an opportunity to take a progressive approach a step further. During the planning process, in conjunction with our partners at IT Services, we came to the realization that the current RFP process, although vastly improved, would still result in committing to a multimillion dollar solution that we haven’t had a chance to experience firsthand. We reflected on other commodities, such as catering and coffee, that require a “taste test” before awarding to a particular supplier. We pondered the feasibility of initiating a similar approach for the financial system, and the concept of the ESR “Bakeoff” was born.

The new two-stage approach

With the goal of making the process simple and meaningful, we will utilize a two-stage approach toward selecting our ESR partner. The first stage will consist of providing all bidders with a concise list of approximately 100 meaningful questions that will be weighted and scored. The initial questions will attempt to determine which functionality will be available “out of the box”, verses requiring configuration or customization. The goal here is to select finalists that can meet as many of our needs as possible through functionality that is already available through their solution.

The second “bakeoff” stage will consist of UC San Diego subject matter experts outlining several “use case” scenarios that will actually be built by the finalists for evaluation and testing by those who will ultimately use the system. The goal here is to select a product based on evaluating something tangible vs. relying on a written response to questions. We’ll have the opportunity to try before we buy, with key components of our solution already built at the time of purchase, as opposed to starting from scratch once the contract is awarded, which is typically the case.

What do the vendors think?

We’ve run this approach by all potential RFP bidders and received enthusiastic support, coupled with a slight sense of panic due to their need to actually build something as part of the process. I’m personally optimistic that this approach will lead to a meaningful and cost-effective result. The broader IPPS Procurement organization and I look forward to supporting the process every step of the way. 


Category: Financial Systems, ESR Behind the Scenes