REQUEST FOR QUALIFICATIONS OR REQUEST FOR PROPOSAL 2.0

With new project delivery options, Construction Manager at Risk (CMr) and Design-Builder (D-B), available or being considered in the Midwest, the age-old question, “Which is appropriate for me: Request for Qualifications (RFQ) or Request for Proposals (RFP)?” has added nuances. As a result, it seemed like a good time to update my original article from May 2014 to help you find the best solicitation method for architectural/professional-design services.

REQUEST FOR QUALIFICATIONS (RFQ)

An RFQ is a qualifications-based selection process; it is NOT a bid. Consider an RFQ to solicit various professional services including architectural, engineering and CMa (Construction Manager Agency) ¹
An RFQ is right for you if you fit the criteria below:

• My city or county is not required to take a competitive bid.
• I want to select a provider who is most qualified to meet my functional and design goals AND not be swayed by fee.
• I want the opportunity to negotiate the fee with my final selection. If I can’t come to terms with them, then I want the option to go to my second or third choice.

Many states in the Midwest do not require advertisement, for these types of professional services. However, some owners will advertise to remove any appearance of bias. Always check with your legal counsel for what is allowable in your area.

REQUEST FOR PROPOSALS (RFP)

An RFP is right for you if you want to select the most qualified company at the best value for your project. An RFP is a request for companies to submit their proposal/bid for a project. It is applicable for goods or construction where a city or county is required to take competitive bids resulting in award of a contract for a product/building. Remember to check with your legal counsel for what is allowable in your area.

RFPs for construction typically involve a price component and qualification component including; company history, capabilities and financial information. This is an appropriate method of soliciting for construction services including GC (general contractor), CMr (construction manager-at-risk) and D-B (design-build). Frequently, RFPs will include the phrase “best-lowest” which allows the owner to consider more than the lowest price.

WHY WOULDN’T I ASK FOR A FEE FOR PROFESSIONAL SERVICES?

Professional fees are typically competitive and a small percentage of the overall cost of a project. If a fee is requested ², a professional service provider may look to limit the services they’ll provide to keep fees down to strategically “win” a project. Later, this can result in additional services, more change orders and higher construction costs.

In the Project Management magazine article, “Cutting Designs Fees Raises Construction Costs,” Charles Nelson’s research show “93% (contractors) indicated that design and documentation quality did influence the price submitted for a tender (bid), while 75% indicated that it also had an influence on the time allowed for a project.” Later in the same article, Nelson shows that an extra 1.5% in architectural fees can result in as much as 7-11% decrease in construction costs.³

Because architectural fees remain competitive, an owner can easily find the average fee range to determine a baseline. With a baseline architectural fee in hand, you can select the best architect for your project.

WHAT’S CHANGED WITH ALTERNATIVE DELIVERY OPTIONS CMr AND D-B?

Both options can begin to blur, or confuse, the design and construction roles. Both options typically include both an RFQ and RFP component as part of the overall process. As a result, it is critical you understand when each is required, to ensure your functional and budget goals are met.

Construction Manager at Risk (CMr)

The CMr Option includes you first selecting an architect, which is done with an RFQ, as noted above. It also includes selecting a CMr, which often includes an RFQ and RFP component.

The CMr selection process frequently begins with an RFQ being advertised, for interested CMs to provide their qualifications. Qualifications are then reviewed based on pre-determined selection criteria, which may include; experience, past performance, safety record, proposed personnel, methodology and other appropriate factors.

An Owner may then decide to issue an RFP to “shortlisted” CMrs, requesting additional information, which may include; CMr project proposal, proposed fee and price to fulfill General Conditions. Typically, an actual Guaranteed Maximum Price (GMP) is not requested at this time.

Design-Build (D-B)

With the D-B option, your project is led by a D-B team. The architect-of-record is hired by, and serves as, a consultant to the D-B team, not the owner. This is where potential conflict can occur between your functional and design expectations and the D-B team’s GMP (Guaranteed Maximum Price).

To make sure your functional & design expectations are met, the D-B Option includes you first selecting an architect/”design criteria consultant”⁴, which is done with an RFQ, as noted above.

In most states that allow CMr and/or D-B delivery options, there is a clearly delineated/prescriptive selection process.  Be sure to seek legal advice from your local attorney before proceeding.

HOW DO I FIND THE MOST QUALIFIED ARCHITECT OR “DESIGN CRITERIA CONSULTANT” FOR MY PROJECT?

• Request architects to submit their qualifications for your project in an RFQ
• Review the RFQ responses
• Call their references
• Conduct online research about them
• After doing your due diligence, shortlist a few to interview. A face-to-face meeting can provide a more subjective evaluation to balance the written qualifications.

WHAT GOES IN AN RFQ?

There are online templates for writing RFQs. Your local architect may also be able to provide you a sample to edit. The main components include:

COVER LETTER

• At a minimum, state who is making the request, what services are being requested, and submittal deadline for “qualified” firms to submit their responses.

RFQ BODY

General Instructions outlining:

• Request: Repeat of cover letter’s information including who and what is being requested.
• Schedule: Provide dates for submittals deadline, selecting shortlisted firms, potential interviews and decision.
• Fee: The following verbiage, or something similar to, should be included here: “The owner name will begin contract negotiations with the firm determined to be the most qualified. In the event that a contract cannot be negotiated with the first firm, the owner name reserves the right to negotiate with the next qualified firm(s) until a contract can be reached.”

Submittal Instructions stating:

• Number of copies and/or electronic submittals required
• Submittals to be delivered in sealed envelope marked “Name of Project”
• Name and address submittals are to be sent to.
• Questions to be submitted in writing to: name at contact information

Statement of Scope stating specific service(s) being requested:

• Outline of the scope of services being requested. (Architect-of-Record or “Design Criteria Consultant”) in a bullet/outline format.

Submittal Content listing items by section to be included in the submittal for review. Listing by section makes it easier for responders to organize their submittal and for reviewers to critique. Include a page limit. Suggested submittal content includes:

• Cover Letter (one page)
• Section 1: Identify firm(s); name, address, phone number and contact person. (one page)
• Section 2: Provide an organizational chart identifying disciplines, specific personnel and role of those who will be assigned to this project. (one page)
• Section 3: Describe your project approach for this project. (two pages)
• Section 4: Firm’s capacity: Number of full-time licensed architects. Provide resumes and workload of those listed in section #2 above who will be assigned to this project. (maximum one page per person)
• Section 5: Detail firm’s quality control process regarding design, document control and construction administration. (one page)
• Section 6: Firm’s litigation history and any pending litigation or binding arbitration with a client. (one page)
• Section 7: Copy of firm’s current professional liability or errors and omissions insurance. (one page)
• Section 8: List firm’s last five (5) similar project including size, location and contact person. (maximum 5 pages)
• Section 9: Describe what makes your firm uniquely qualified for this project. (one page)

WHAT GOES IN AN RFP?

There are online templates for writing an RFP. Check out Form-Based Codes Institute or Voice Marketing. Your local architect is another resource; they may be able to provide you a sample to edit.

The requested information will vary depending on the construction delivery method selected: CMr or D-B.

Requested information may be similar to the RFQ: firm, team member roles and experience, project approach, similar project experience and unique qualifications.

With the RFP, add Section 10: Request fee, bid, GMP or method of determining such.

LOCAL JURISDICTION

Local bid laws have varying stipulations and requirements for soliciting and receiving RFP proposal responses.

Professional services RFQ tend to have fewer stipulations and requirements. In some jurisdictions, there is not even a requirement to solicit RFQs.

Whether you decide to use an RFP or an RFQ, seek legal advice from your local attorney before proceeding.

¹ CMa (Construction Manager Agency) project delivery option is a professional service option where the CM provides management services as an agent for the owner, of multiple prime contracts. In this option the CM does not self-perform any construction.
² Some states stipulate a qualification-based selection process for professional services only.
³ Nelson, Charles. (2014, February). Cutting design fees raises construction costs. Project Management, Volume 23, Issue 2.
⁴ To ensure your functional & design expectations are met, you must clearly communicate to the D-B team your expectations prior to them providing the GMP proposal. This is done by bringing in an architect to work with you in developing your “non-negotiables.” Some states refer to this entity as the “Design Criteria Consultant” and is responsible for developing “Bridging Documents” which are issued to all D-B proposers to ensure your functional & design expectations are met.