Pre-Proposal Meeting Best Value Model Travel Management Services

1. Pre-Proposal MeetingBest Value ModelTravel Management Services

2. This presentation is being provided for educational purposes onlyPlease refer to the RFP for specific instructionsIf there are any inconsistencies, the RFP and Amendments shall take precedence over this presentation

3. Best Value Model

4. Best Value Model

5. PBSRG Research Results Worldwide as a leader in Best-Value Systems • 18 Years • 1,600+ Projects • $4.6 Billion Services & Construction • $1.8 Billion Netherlands infrastructure construction test • 5% Increase in Vendor profit • 98% On-time, On-Budget, Customer Satisfaction • ASU – investments of over $100M due to Best Value • GSA (largest organization in U.S. delivering services) implementation in 2009 • Tests also in Africa, Southeast Asia, Canada, & Australia

6. Best Value Objectives • Client outsourcing to experts based on value and performance • Minimize risk of non-performance • Vendors optimize project delivery • Complete to the expectations • Customer satisfaction / No complaints • Minimize the need for client management, direction, and decision making. • In return, the vendors can maximize profit by being more efficient WIN WIN

7. Best Value Model

8. What are we trying to accomplish? Selection Based upon Proponent Expertise: • Ability to understand and plan the service delivery • Identify risks to the service • Mitigate risks to the services • Add value to optimize service delivery • Cost Competitive

9. STEP 1 RFP Project Capability PPI Price STEP 2 Interviews STEP 3 Prioritization STEP 4 Move forward to Pre Award Vendor Vendor Vendor Vendor Selection Steps

10. Evaluation Weights

11. Blind Submittals – Project Capability Allows Vendors to differentiate themselves based upon their ability to identify and minimize risks to the project. Technical Capability = capability to meet requirements Risk Plan Simple, concise, actionable plans = risks you don’t control Value Added = added scope

12. Part 1: Technical Capability Differentiate capability to meet the requirements of this project Risks that have been minimized before the project begins due to the Vendor’s expertise. Explain why the risk is a risk How it is minimized with the Vendor’s expertise Should be a risk that is specific to the current project For high score solution should contain performance information & best value practices No names, two pages, no marketing, part of final contract

13. Part 1: Technical Capability Template

14. Part 2: Risk Assessment Identify major project risks Risks that have not yet been minimized before the start of the project (risks that the Vendor DOES NOT control) Explain why the risk is a risk May cause cost increases, transition delays, change orders, or cause dissatisfaction to the client Should be non-technical Should be a risk specific to the current project Identify solution to avoid / minimize the risk Non-technical explanation Must explain how risk is avoided or minimized from occurring For high score solution should contain performance information & best value practices

15. Part 2: Risk Assessment Template

16. Part 3: Value Added Value Added Propose any options that could increase the value (expectation, cost, schedule, delivery, satisfaction) of the project. Outside the specific requirements and/or base proposal cost.

17. Part 3: Value Added Template

18. Examples Part 1: Project Capability

19. Example of SolutionsRisk: Decline in Customer Service Standards Type: Project Capability • Plan 1 • We will use our 20 years of experience in bookstore services to minimize the risk of declining customer service standards. • Plan 2 • Sales associate training is key. We have a formal training program for new employees (and an annual refresher training for current employees) that has been successful at 5 previous service sites of similar size and scope. • We will implement a secret shopper program to ensure we maintain our company-wide 88% positive rate and our 93% positive local rate. • We will also conduct annual customer service satisfaction surveys with direct end-users. Suggestions and complaints will be incorporated in a proposed annual performance review meeting with the Owner group to reassess opportunities to add value after each year during the contract.

20. Example of SolutionsRisk: Availability of Online Self-Service Portal for Online Housing Applications Type: Project Capability • Plan 1 • Vendor will evaluate existing Owner software platforms to ensure integration and availability of the Online Self-Service Solution • Plan 2 • Vendor will provide a Portal Framework for all online self-service solutions. This Portal does not require any 3rd party web development software or web development expertise by the Owner. • This approach minimizes risk of error and downtime that would normally occur if the Owner was required to use html templates, dedicate a web developer, or have to modify html code directly. • The Portal Framework has been used on three previous projects with zero downtime events.

21. Example of Execution Plan SolutionPlan: Noise from Demolition Type: Risk that Vendor does control • Plan 1 • We will work with the user to minimize the impact of noise from demolition. • Plan 2 • We have planned to demolition during off hours and weekends. This will have a slight impact on our cost (less than 1%), but the impact to customer satisfaction justifies this. • We will also install rubber sheets on the floors to diminish noise and vibrations. • Both solutions can be performed within your budget. • Both solutions have been used on multiple previous projects w/ high levels of customer satisfaction (9.4/10).

22. Examples Part 2: Risk Assessment

23. Example of Risk Assessment Solutions Risk:Material Price EscalationType: Risk the Vendor DOES NOT control • Risk Solution 1 • The owner can be assured all risks associated with material escalations will be eliminated because we offer the benefit of an experienced project team that includes the most detailed, prequalified and extensive list of subVendors and suppliers, from around the world. • Risk Solution 2 • The cost of concrete has been rising drastically. Since this project requires a substantial amount of concrete, cost is a risk. To minimize this risk, we have secured and signed a contract with a local concrete manufacturer to prevent any increase in cost during the duration of this project. MARKETING INFORMATION

24. Example of Solutions Risk: Getting water to the site (utilities) Type: Risk the Vendor DOES NOT control • Risk Solution 1 • Coordination with [water company] is critical. We will coordinate and plan with [water company] as soon as the award is made to make sure that we get water to the site to irrigate the fields. • Risk Solution 2 • We will coordinate and schedule the water with [water company]. However, based on past experience there is a high risk they will not meet the schedule (the water company does not meet schedule over 90% of the time). • We will have temporary waterlines setup and ready to connect to the nearby fire hydrant to irrigate until [water company] is ready. • We will also have water trucks on-site if there is problems with connecting the lines.

25. Examples Part 3: Value Added

26. Example of Value Added

27. Example: Value Added Items Reroofing this building will not stop all water leaks. The majority of the leaks are caused by cracks in the parapet walls, broken/missing glass, and poor caulking. For an additional $20K and 3 weeks in schedule we can replace and repair all of these items.

28. Example: Value Added Items Dining Services Contract • We may be able to increase revenues to the University by an additional 5% per year, if we are allowed to install and operate our own vending machines throughout campus.

29. We are Looking for Vendors Who Can Think Ahead… …And Act In The Client’s Best Interest 29

30. Things to Avoid • Marketing Information: • Our company is known worldwide as a leader in online education. • We will use our long history to make sure the project is a success. • We will use state-of-the-art process to make it a success. • Transferring risk back to client: • We will work with the owner to resolve issues • We will have team meetings / partnering meeting with the owner • General risks and/or general solutions: • We will plan ahead to coordinate activities • We will plan ahead to get classes scheduled and created • Overly Technical data: • The system we propose has 200% increase in PRX bandwidth modularity.

31. Submittal Requirements • Must NOTcontain ANY identifying information (names, company names, project names, product names, etc.) • Must use the provided template (can submit as many risks as fit within the 2 page limits of each submittal) • List Risks in order of priority

32. STEP 1 RFP Project Capability PPI Cost STEP 2 Interviews STEP 3 Prioritization STEP 4 Move forward to Pre Award Vendor Vendor Vendor Vendor Selection Steps

33. Past Performance Information (PPI) • PPI collected on all Proponents and their critical team components. • Once the PPI is collected, it is stored in a database. • Project Close Out ratings from Client– updates PPI for future work

34. Critical Components Past Performance Information will be collected on: • Travel Management Firm – 5 References Maximum • District / Area Manager – 3 References Maximum • Account Representative – 3 References Maximum • Technical Lead – 3 References Maximum

35. Past Performance Information 3 Parts: • Survey Questionnaire • Reference List • PPI Score • Survey Scores are 1-10 and used in Evaluation Criteria • All individuals and firms must have separate reference lists. • Each individual will be treated as a separate entity.

36. PPI Process The Proponent is responsible for sending out a survey questionnaire to each of their past clients. The survey must be faxed/emailed back to the Proponent The Proponent will submit all surveys to the Owner with their submittal. Proponent Vendor Setup and send Survey Forms Past Client Vendor Past Client Evaluates and Returns

37. Survey Form

38. Don’t Forget to Add Your Email and verify signature Don’t forget to have the evaluator sign the form Fax or Email

39. Vendor Past Client Past Client Vendor Example Survey (Firm and Individuals)

40. Firm and each individual must submit a “Reference List” (which identifies all past projects submitted) PPI Reference List 40

41. Survey Must Match Reference List 3/15/2011 SMART Classroom

42. References • The reference list must contain different projects • You may submit multiple jobs for the same past client

43. Enter Survey Scores

44. PPI Summary The vendor should pick their own references The vendor should collect all surveys The vendor and individuals must create a “Reference List” and prepare and send out survey forms. Close out ratings at the end of the contract will be used to update PPI scores going forward at UofA 44

45. STEP 1 RFP Project Capability PPI Price STEP 2 Interviews STEP 3 Prioritization STEP 4 Move forward to Pre Award Vendor Vendor Vendor Vendor Selection Steps

46. Pricing Option A – University Travel (excluding Athletics) Option B – Athletics Travel (excluding University) Option C – Both University and Athletics Option C submissions MUST also submit Options A & C Option D – Proponent-Generated Solution Propose the optimal financial structure 46

47. Option A – University Travel (excluding Athletics)

48. Option B – Athletics Travel (excluding University)

49. Option C – University and Athletics Travel

50. Option D – Proponent-Generated Solution