Policy, Program and Procedures

I am formalizing Penn National Insurance's Vendor Management policy. I was asked to add guidelines around when an RFP (Request for Proposal) should or should not be used.

Does your organization have a formal vendor management policy or vendor selection process? If yes, does it include guidelines around when an RFP should be used? Will you share the policy or those requirements with me?

What would be a good trigger or triggers s to require the use of an RFP? What would be exceptions from the RFP process? What would you think is a good threshold to require the use of an RFP? When do you think an RFP is overkill or unnecessary? I'm looking for broad reaching ideas more than specific examples. As examples, I'd want to use a formal RFP for replacing a policy administration system. I don't think an RFP is necessary to replace 30 multi-function, walk-up copiers in our office complex.

Again, we are trying to identify RFP thresholds or RFP criteria of when to use/not use an RFP.

Thank you for brainstorming with me.

Hello!  We do have a vendor management policy and standard which provide guidelines for when the RFI/RFP process should be used.  There are a variety of factors which could trigger the RFP process, such as overall cost (select a threshold, for example $50-100k or more), criticality of the service performed, whether or not the service will impact earnings, access to sensitive data, number of departments impacted, etc. For example, if replacing an online banking platform, which is a critical service with a high cost, access to sensitive data, and impacting multiple departments, an RFP would be required.

When replacing a landscaper or ordering teller mats, an RFP would not necessarily be required.  Even so, with less critical items, such as teller mats or copiers, if replacing mats/copiers for 100 branches, it may be beneficial to follow a less formal RFP process and achieve cost savings. 

Hope that helps.