Starting with the data that has been gathered, we need to assess the current opportunity in comparison to existing contracts, acceptable terms and conditions, pricing information, and relative value compared to similar transactions. This is performed in the Analyze Phase, and is discussed in detail in the table below.
By following these guidelines, we greatly improve our knowledge of the value of our pending opportunity by analyzing the details using market based comparison points. While each opportunity is unique and may require special analysis, the information covers common issues and greatly improves the confidence that best value will be achieved.
|Price Factors Overview||Become familiar with the factors that drive price.||KO, PMO, BFM||Best Value Price Factors Guide|
|Comparison on Proposed Deal to Contract Vehicles||Determine the price available under DoD contract vehicle(s) and the anticipated discounts that can be secured through further discussions and based on benchmark data.||KO, BFM|
|After obtaining all data presented by the vendor, if an existing contract is in place, review the license offerings, license pricing, Terms and Conditions, maintenance/support pricing, and discounting structure in the contract. Compare it to the vendor data and quotes.||KO|
|Benchmarking||Become familiar with benchmarking principles.||KO, PMO||Benchmark Data Gathering Checklist|
|Gather data about past transactions entered for similar products and solutions in similar circumstances.||KO, PM SPM||Benchmark Elements Table
|Enter the vendor’s proposed pricing into the TCO Workbook||KO, PMO||Proposed Deal Points Checklist
|Determine the contract vehicle that best fits the acquisition.||KO, BFM|
|Terms and Conditions||Establish a list of the Terms and Conditions that appear most favorable to your pending acquisition. Use the Strategic Terms Checklist as a starting point for your basis for Ts & Cs position, and the Best Value Terms and Conditions Guide as your detailed reference source. Compare the Ts & Cs in the existing contract to your position. Perform trade-off analysis on any differences – what do you need to add, and at what cost?||KO, BFM|
|TCO||Define the anticipated Total Cost of Ownership over 5 years and 10 years. Include costs for implementation, maintenance and support, education and training, and anticipated consulting services).||BFM, KO||TCO Workbook|
|Analyze the pricing proposed by the vendor against the benchmarks gathered on similar transactions and the impact on total cost of ownership (TCO).||KO, BFM||TCO Workbook
Price Analysis Checklist
|Establish a range of target price that you expect for your transaction. Use the Price Analysis Checklist as your starting point. Estimate cost of Terms and Conditions trade-off analysis using the guide.||KO, SPM|