Don’t you hate it when you go out shopping for a product, try several stores, and make your purchase, then discover that someone else had the same product for a lower price? The truth is I was likely conditioned to assume that only those stores I tried could offer that product at a price I thought competitive. Perhaps those stores had culled my favor by being the biggest, or what I thought was the only source of the product. Regardless, the seasoned shoppers among you would tell me that my process was flawed since I did not get the best value. What about airlines that send out Bids for MRO work for their aircraft and components thereof? Do they always get the best value following the RFQ/RFP process?
I’m here to tell you no.
Nearly every news outlet channel associated with MRO activity publishes summaries of firms which were awarded MRO contracts. An oft expressed frustration among MRO Salespersons is “I wish we had been presented the opportunity to bid on that one, not fair!” You don’t have to major in Quantitative Analysis to understand that the greater the pool of respondents, the greater the probability that you will have attained your goal of best value for your airline’s MRO buck. The fact remains however, that many airline MRO bids, RFP’s or RFQ’s continue to be offered to a limited number of firms. Why?
A short list to answer the question as to why this practice persists would include:
- The airline is firmly convinced that only those addressed can provide the service
- There does not appear to be a popularly accepted method to identify an exhaustive list of qualified bidders or
- There does not appear to be a popularly accepted method to publically post the bids for viewing by the widest possible pool of respondents
- The airline does not have the staff to handle the expected mass influx of respondents
For the cynical and conspiracy theorists among you, we’d have to add:
- The award decision has already been decided; the bidding process is just for show
- A key, award- decision maker has been unethically influenced by an MRO provider
BTW, I’m disturbed that so many people are fixated on conspiracy theories. There are whole and continuing TV programs servicing this popular phenomenon. A conspiracy theory behind every major event! No doubt this lines the pockets of those selling airtime and books; perhaps it’s an emerging genre in literature? Don’t get me started please! I’m going to coin a new Medical acronym: CTS, for Conspiracy Theory Syndrome. In the worst of cases, behavior is marked by delusional, paranoiac visions of hidden agendas and government agencies out to get us. CTS can be treated by gratuitous amounts of overly prescribed and popular psyche-active drugs, or in some cases a swift slap in the face followed by a shoulder-shaking “SNAP OUT OF IT!” from a close friend. But I digress…
Cynicism and CTS aside, all this brings to mind a best-practice in government (yes those do exist); a well-used website called FedBizOpps for Federal Business Opportunities at http://www.fbo.gov/.
It seems there are laws which require most Federal Bids, called solicitations, be posted on a publically accessible platform so that anyone qualified can participate in the response. The solicitations target those firms with matching NAICS codes, or North American Industry Classification System. This is simply a code that matches the type of firm you have. For example, there are codes for Consultants like myself. I have a virtual agent set up in FBO that sends me notifications and links to all Solicitations with my code. Every day I get email from FBO regarding new or revised Solicitations. According to FBO, at this writing there are more than 31,700 active Federal Solicitations. The Solicitations are fairly uniform regardless of the originating government source. All this lends an air of fairness and uniformity; quite lacking in the civilian sector as I have eluded. Wouldn’t it be cool if such functionality existed and was practiced in the civilian MRO world? If necessary you could outsource the gate-keeping to manage the expected big number of respondents; in case you are staff challenged.
Bottom line? You will have greater assurance that you got the best deal for your airline. It may be that competition is increased, further tamping prices, and getting your airline the best deal. Neat, eh?
Now, I know that many of you are going to say that this-or-that website was tried, exists, or is emerging. Agreed, but why then aren’t most airlines on board with those, or a broader base of respondents targeted? Why is the behavior continuing? Regardless, leave a comment. I hear all the time how your comments are appreciated and they add insight and useful information.
Psst. Don’t look around, but just between you and me, I heard from an undisclosed but reliable source that the NSA is monitoring the aforementioned flawed bidding practices. It seems there is a link between secretive groups seeking the economic collapse of our nation and the unexplained continuing bidding practice. Just yesterday I’m sure I saw a drone overhead being controlled from a person behind that grassy knoll and…nah, it can’t be…
Over ‘n out
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