Qualifications-based Selection

Qualifications-basedQualifications-basedSelectionSelection

Why value outweighs cost in the Why value outweighs cost in the selection of design services selection of design services

QBS: What? Who? Why?QBS: What? Who? Why?

What is QBS?What is QBS?

• A nationally endorsed procedure for selecting A nationally endorsed procedure for selecting and retaining design professionals that will and retaining design professionals that will provide the best value to the owner in terms of provide the best value to the owner in terms of quality and total project cost.quality and total project cost.

• A competitive procurement approach that A competitive procurement approach that emphasizes quality attributes.emphasizes quality attributes.

HistoryHistory• Prior to 1939Prior to 1939

• Most design done by federal employeesMost design done by federal employees

• 1939 A/E Selection Provision1939 A/E Selection Provision• 1947 Armed Services Procurement Act and 1947 Armed Services Procurement Act and

1949 Federal Property and Administrative 1949 Federal Property and Administrative Procedures ActProcedures Act

• 1972 – The Federal “Brooks” Law 1972 – The Federal “Brooks” Law (P.L. 92-582) signed(P.L. 92-582) signed• Codified into federal law the qualifications-based Codified into federal law the qualifications-based

selection process for A/E servicesselection process for A/E services

• 1984 Competition in Contracting Act1984 Competition in Contracting Act

Who Uses QBS?Who Uses QBS?• Local, state and federal governmental agencies Local, state and federal governmental agencies

that procure A/E servicesthat procure A/E services

• Private industryPrivate industry

• Other public and private institutionsOther public and private institutions

• Design professionals when hiring other design Design professionals when hiring other design professionalsprofessionals

• Other users of services/products who place Other users of services/products who place quality first quality first

Engineering ServicesEngineering Services

• Are services; not commoditiesAre services; not commodities

• Engineers provide: Engineers provide: • Technical ExpertiseTechnical Expertise

• InnovationInnovation

• Latest TechnologyLatest Technology

• High Degree of Professional CompetenceHigh Degree of Professional Competence

Why not use low-bid?Why not use low-bid?• To those not familiar with our industry low-bid To those not familiar with our industry low-bid

may seem logical may seem logical

The Reality of BiddingThe Reality of Bidding

• Low-bidding leads to inferior results and actually increases Low-bidding leads to inferior results and actually increases overall project costsoverall project costs

• Doesn’t foster building relationships Doesn’t foster building relationships

• 2002 Polytechnic University (New York) study 2002 Polytechnic University (New York) study

The cost of A/E services is typically less than The cost of A/E services is typically less than 1% of the project life-cycle costs.1% of the project life-cycle costs.

What Does the Owner Really Want?What Does the Owner Really Want?

Lowest Construction CostLowest Construction Cost Lowest A/E CostLowest A/E Cost Lowest Life-Cycle CostLowest Life-Cycle Cost ValueValue

Why QBS?Why QBS?• Life Cycle Cost ConsiderationsLife Cycle Cost Considerations• Team BuildingTeam Building• Technology/InnovationTechnology/Innovation• Reduced ChangesReduced Changes• Flexible Contract ApproachesFlexible Contract Approaches• Competition Among Best Performers; Not Low BiddersCompetition Among Best Performers; Not Low Bidders

The Request for Qualifications The Request for Qualifications (RFQ) Process(RFQ) Process

• Selecting a Design FirmSelecting a Design Firm1. An owner identifies the general scope of work and 1. An owner identifies the general scope of work and

develops a selection schedule.develops a selection schedule.

2. A request for qualifications is issued.2. A request for qualifications is issued.

3. Statements of qualifications are evaluated.3. Statements of qualifications are evaluated.• Team’s Structure and Team MembersTeam’s Structure and Team Members• Team’s QualificationsTeam’s Qualifications• ReferencesReferences• ExperienceExperience• Project Approach Project Approach • Location Location • Current Workload Current Workload

4. A short-list of qualified firms to be interviewed is 4. A short-list of qualified firms to be interviewed is determined.determined.

5. Interviews are conducted and the firms are ranked.5. Interviews are conducted and the firms are ranked.

The RFQ ProcessThe RFQ Process

• Negotiating a ContractNegotiating a Contract6. The owner invites the highest ranked firm to assist in defining a 6. The owner invites the highest ranked firm to assist in defining a

detailed scope of work. detailed scope of work.

7. The design firm develops and submits to the owner a detailed fee 7. The design firm develops and submits to the owner a detailed fee proposal, based on the agreed upon scope of work.proposal, based on the agreed upon scope of work.

8. If the proposed fee is not acceptable to the owner, the owner and 8. If the proposed fee is not acceptable to the owner, the owner and designer work together to modify the scope of work, schedule and designer work together to modify the scope of work, schedule and budget to determine if an agreement on fee can be achieved. budget to determine if an agreement on fee can be achieved.

9. If an agreement cannot be reached with the top ranked firm, those 9. If an agreement cannot be reached with the top ranked firm, those negotiations are ended and negotiations begin with the next most negotiations are ended and negotiations begin with the next most qualified firm. qualified firm.

10. An agreement covering the above is executed. 10. An agreement covering the above is executed.

11. Firms involved in the selection process are given post-selection 11. Firms involved in the selection process are given post-selection feedback, when requested.feedback, when requested.

Earning the Right to Earning the Right to Do the Next ProjectDo the Next Project

• In some cases, the owner reserves the right to select In some cases, the owner reserves the right to select a firm based on known qualifications rather than a firm based on known qualifications rather than opening up the project to the competitive process.opening up the project to the competitive process.

• However, the competitive process is often required However, the competitive process is often required for public owners to illustrate transparency.for public owners to illustrate transparency.

• Client satisfaction and not getting complacent is key Client satisfaction and not getting complacent is key to success for both approaches.to success for both approaches.

AgenciesAgencies

Acceptance of QBS by Governmental Agencies: Acceptance of QBS by Governmental Agencies: •Indiana Department of Transportation Indiana Department of Transportation

•State Revolving FundState Revolving Fund

•USDA Rural Development USDA Rural Development

•Office of Community and Rural Affairs (QBS is mandatory)Office of Community and Rural Affairs (QBS is mandatory)

•Department of Natural ResourcesDepartment of Natural Resources

•Indiana Department of Environmental Management Indiana Department of Environmental Management

•Economic Development Administration Economic Development Administration

•Department of Administration Department of Administration

•General Services Administration General Services Administration

•Veterans AdministrationVeterans Administration

Who Endorses QBS Locally?Who Endorses QBS Locally?• American Council of Engineering Companies of IndianaAmerican Council of Engineering Companies of Indiana• American Institute of Architects of IndianaAmerican Institute of Architects of Indiana• American Society of Civil Engineers of IndianaAmerican Society of Civil Engineers of Indiana• Indiana Association of Cities and Towns Indiana Association of Cities and Towns • Indiana Association of County Commissioners Indiana Association of County Commissioners • Indiana Society of Professional EngineersIndiana Society of Professional Engineers• Indiana Society of Professional Land SurveyorsIndiana Society of Professional Land Surveyors• Professional Engineers in Private PracticeProfessional Engineers in Private Practice• Society for Marketing Professional Services Society for Marketing Professional Services

Who Endorses QBS Nationally?Who Endorses QBS Nationally?• American Bar AssociationAmerican Bar Association• American Council of Engineering Companies American Council of Engineering Companies • American Institute of ArchitectsAmerican Institute of Architects• American Public Works AssociationAmerican Public Works Association• American Road & Transportation Builders Association American Road & Transportation Builders Association • American Society of Civil EngineersAmerican Society of Civil Engineers• American Society of Landscape ArchitectsAmerican Society of Landscape Architects• American Water Works AssociationAmerican Water Works Association• International Interior Design AssociationInternational Interior Design Association• National Society of Professional Engineers National Society of Professional Engineers • National Society of Professional Surveyors National Society of Professional Surveyors • Professional Engineers in Private PracticeProfessional Engineers in Private Practice• Society for Marketing Professional Services Society for Marketing Professional Services • Society of Interior Designers Society of Interior Designers

Question Break Question Break

Common MisconceptionsCommon Misconceptions

Misconception: Misconception: QBS takes longer. QBS takes longer.

QBS fosters teamwork between the client and QBS fosters teamwork between the client and engineering and facilitates construction, leading engineering and facilitates construction, leading to faster project delivery.to faster project delivery.

Misconception: Misconception: QBS is a waste of taxpayer money. QBS is a waste of taxpayer money.

Low-bid is more expensive because it leads to Low-bid is more expensive because it leads to increased change orders and high project increased change orders and high project maintenance costs. Furthermore, QBS provides maintenance costs. Furthermore, QBS provides the public with a high quality and safe design. the public with a high quality and safe design.

Misconception: Misconception: QBS eliminates price as a selection criteria.QBS eliminates price as a selection criteria.

Price is a factor! Price becomes a factor only Price is a factor! Price becomes a factor only after the most qualified firm has been identified after the most qualified firm has been identified and a detailed scope of work has been jointly and a detailed scope of work has been jointly developed by the owner and design professional.developed by the owner and design professional.

Call to ActionCall to Action

• Unify approach in the profession Unify approach in the profession • Educate newly elected officials Educate newly elected officials • Continually educate and reinforce value of QBS to state Continually educate and reinforce value of QBS to state

agenciesagencies• Continue educating ourselvesContinue educating ourselves• Get involved (ACEC Indiana QBS committee) Get involved (ACEC Indiana QBS committee) • Local web site Local web site • National web site National web site • Qualifications-based pursuits (Good go/no go process) Qualifications-based pursuits (Good go/no go process) • Deliver! Deliver!

ResourcesResources

• ACEC’s Online QBS Resource CenterACEC’s Online QBS Resource Center• http://www.acec.org/advocacy/committees/qbs.cfmhttp://www.acec.org/advocacy/committees/qbs.cfm

• QBS IndianaQBS Indiana• http://www.qbsindiana.org/index.htmlhttp://www.qbsindiana.org/index.html

Questions and DiscussionQuestions and Discussion