Augmentation Agreements

							                                                                            Agenda Item No.: E.2.b.

Request for Proposal No. 904399 – Information Technology Staff Augmentation Services                       E
                                                                                                           2
Recommendation:                                              City’s competitively acquired, in-scope
                                                                                                           b
That Administration award tender project                     IT contract resources.
No. 904399 – Information Technology Staff                   The structure of this vendor network
Augmentation Services, and enter into all                    includes one primary vendor who will
relevant agreements, such tender to be in                    supply an automated tool to facilitate the
accordance with Administration’s normal                      electronic distribution of all resource
tendering guidelines.                                        opportunities to the vendor network and
                                                             provide activity tracking and reporting
Report Summary                                               capabilities. Additionally, up to three
 This report has been submitted                             secondary vendors will be selected to
   separately from the regular Open                          participate in submitting qualified
   Tenders $1,000,000 or greater report                      resources for consideration and for
   due to the value of this procurement and                  delivering all selected resources for
   the nature of the Request For Proposal                    engagement.
   approach being specified.                                Other key elements of this model include
                                                             the following:
Report                                                        o A requirement for all participating
 The City has a long history with the                           vendors to charge according to a
   engagement of competitively-acquired                          fixed rate schedule;
   external Information Technology (IT)                       o A requirement for all engagements to
   contract resources to support the                             be contracted through the Primary
   delivery of information technology                            vendor according to a “Master
   projects and operational requirements.                        Services Agreement.”
 The current process to acquire IT                         Given the uniqueness of the
   contract resources requires an open                       requirements under this new model,
   Request For Proposal (RFP) to be issued                   there is a potential for adverse reaction
   for each individual IT contract resource                  from certain vendors who are unwilling
   requirement.                                              or unable to meet the RFP requirements.
 In 2005, the City issued 26 such RFPs                     Tender value classification for this RFP
   with expenditures totalling nearly                        is Category F - $15,000,000 or greater.
   $3,000,000.
                                                            Contract term for this RFP is for a fixed
 A new model for acquiring IT contract
                                                             term of one year and includes up to four
   resources is being established through                    additional one-year renewal terms (for a
   this RFP.                                                 total potential Contract term of up to five
 The new model was validated through an                     years).
   open marketplace consultation process.                   Expenditures under this RFP are
 This model will establish a core vendor                    estimated at a value of up to
   network (initially four vendors) who will                 $25,000,000 over the Contract term.
   actively compete to supply all of the




Routing:              Executive Co mmittee
Delegation:           J. Tustian/K. Rozmahel/D. Lajeunesse
Written By:           D. Lajeunesse
March 14, 2006        Corporate Serv ices Depart ment
File: 2006COF026      (Page 1 of 2)
Request for Proposal for IT Staff Augmentation Services




   This RFP is compliant with the                      Background Information Available on
    Agreement on Internal Trade, Chapter                Request
    Five (Procurement).                                 1. City of Edmonton RFP #904399 – IT
Budget/Financial Implications                              Staff Augmentation Services.
   All costs associated with this project are
    included in existing budgets.
   All purchases under this agreement will
    fall within existing operating budget
    approvals.

Justification of Recommendation
This new IT contract resource acquisition
model is expected to achieve significant
benefits to the City through leveraging the
City’s spending in this category and from
process efficiencies. These include:
 cost savings;
 process cycle time reductions;
 administrative process improvements
    (e.g. contract administration, billings and
    payment, issues resolution, etc.);
 reduction in staff time and effort when
    compared with management of current
    process;
 improved reporting and performance
    measurement; and
 opportunity to decrease the incidence of
    sole source selection of IT contract
    resources where urgency of need did not
    permit acquisition through existing
    competitive process.

Background Information Attached
1. Highlights of New Model for
   Acquisition of IT Contract Resources




                                             (Page 2 of 2)
                                                                                                                                                                   Attachme nt 1
Highlights of ne w model for acquisition of IT contract resources




Given the challenges and issues associated with the City’s current practices for acquiring IT contract
resources, and following a thorough marketplace consultation process and research into leading staff
augmentation practices in large private and public sector organizations, the City has developed an
innovative approach to IT staff augmentation which forms the basis of this RFP. This new model is
founded on a multi-vendor strategy coordinated through a managed service provider and leverages vendor
consolidation and automation to drive increased value and efficiency in the acquisition of contract
resources and the administration of associated processes. The following chart provides a high-level
illustration of this new IT staff augmentation model.


                                                                                     City of Edmonton
 Contract resource requirements




                                                                                                                                                                              Qualified candidates
                                                                                                                            supplies VMS tool
                                                                                                                            prime contractor for all placements
                                  VMS Tool




                                                                                                                                                                   VMS Tool
                                                                                        Primary Vendor                      pays secondary vendors
                                                                                       (Managed Service                     manages processes
                                                                                           Provider)                        training on tools and processes
                                                                                                                             other services



                                                                         Secondary                            Secondary                         Secondary
                                             Primary Vendor
                                                                         Vendor #1                            Vendor #2                         Vendor #3

                                                                 compete equally on all applicable IT contract opportunities using VMS tool
                                                                 contract through primary vendor for all successful placements
                                                                 hourly rates cannot exceed City fixed rate schedule
                                                                 invoice primary vendor for all placements




Pursuant to this RFP, the City intends to select one Proponent who will be designated as the Primary
Vendor with managed services provider responsibilities, and up to three Secondary Vendors who will
participate in all resultant IT contract resource engagement opportunities. The dual roles of the Primary
Vendor include facilitating the automated contract resource procurement process and providing the City
with a single point of accountability for ALL resources contracted through this process, as well as to
participate in all recruitment opportunities in equal competition with all Secondary Vendors. The role of
Secondary Vendor involves submitting candidates for consideration on all applicable opportunities,
working through the Primary Vendor to prepare selected candidates for engagement and working with the
Primary Vendor and City in resolving any issues that may arise during the term of a contract resource
engagement.




                                                                                    Attachment 1 - Page 1 of 1