Insider Tips on Buying a SCADA System

Evaluating Prospective Vendors

Evaluating vendors and their responses to your questions should be a combination of art and science, a combination of corporate chemistry and bottom-line common sense. Too many companies compile and evaluate bids by the numbers. I'm not talking about money. SCADA users in the past have worked very hard to try to normalize vendor bids. But in many cases the criteria and point value assignments are not always developed to provide an objective evaluation. This is always a hard task, but it must be done.

It's not so easy to compare less quantifiable factors like customer references and project methodology. It's especially difficult calculating the effectiveness of a long-term relationship with the vendor. But if your project is to succeed, those factors must be at the top of the list and given due consideration.

Identifying Potential Vendors

One of the first challenges you must face is identifying a list of bidders.

It is an urban legend to think that the more competitive you can make the bidding, the lower the long-term cost of ownership will be. So why not send an RFQ to every system integrator you can find?

First of all, having a lot of bidders does not ensure a lower price. That's because few vendors are qualified to bid on - much less execute - your project. They could all be highly competent. But they may not all be competent to execute a project like yours. So you have to narrow the list down. If you don't, you will get a lot of unrealistically low and high bids from vendors who don't understand what you need. It takes time to eliminate all the unqualified bids.

There are several ways to narrow the list. You could ask for a proposal in which you outline your project and ask potential bidders to propose how they might execute such a project. You could also ask them to put together a least-cost estimate on a generic architecture. This would give you some good ideas as well as allow you to examine how well different vendors respond to your criteria. Of course, you would also ask for specific company details, references, etc. to help further narrow the list.

If your project is especially large, you should consider examining each potential vendor's project execution methodology. Many engineers fly by the seat of their pants. They rely on their experience, ingenuity, instinct, and knowledge to basically make it up as they go along. That might be acceptable for a small project. But it can be a disaster for a large project that involves multiple engineers and requires clearly defined lines of communication between customer and vendor along with exacting accountability. A documented project execution methodology can help ensure that all members of the team understand their role, understand company procedures, and understand the best way to accomplish major milestones. This might consist of a set of standard operating procedures, work instructions, or other tools that allow the vendor to manage projects to a successful conclusion.

At some point, you will need to test that project execution methodology. How can you do that short of actually hiring the vendor? There are several ways. Ask each vendor staff member that you meet where they fit into the project lifecycle. Do they seem to act more like independent contractors or more like a team with a common sense of mission?

Next, talk to the vendor's customers. Do their customers see tangible evidence that the vendor has a project execution plan? Does the vendor actually follow the plan, or is it just to impress prospects? Does the vendor provide written reports on a regular schedule? Are key vendor contacts available when needed? Can you talk to them and get straight answers from them or do they constantly defer to their supervisor? How is the after-project support? Go on site visits and see the installed systems first hand.

Choosing a SCADA system vendor is risky. You need to find out whether the vendors on your final bid list add to that risk or reduce that risk.

If you end up making a final choice by the numbers, please make sure that the list of vendors you have to choose from are vetted first. Make sure that final list includes vendors that your gut tells you can do a good job. And make sure your gut is well informed.

Develop a Selection Process

Very often we see RFQs that include the company's selection criteria. While that's very good for us vendors to know, we are amazed to see how complex that criteria can be. Very often its complexity rivals the complexity of the specification. It seems that scoring such bids will take a lot more work and time than it took to create the bid.

We have seen huge matrixes with literally hundreds of criteria listed - some with significance weighting and some without. Learning how to score such a bid can take hours. You have to wonder how consistent scoring can be with such complex criteria. Most of it still boils down to a judgment call, and those judgments can't possibly be consistent with so many criteria to consider.

Another important factor is who you get to help evaluate the bids. Make sure that each significant stakeholder is represented, such as field engineering, operations, IT, and management. First of all, it's good politics. But even more important, each of those disciplines brings a perspective to the evaluation that is crucial to making the right choice. Management might like the low bidder, but field engineering and operations might find flaws in that bidder's technical proposal. By the same token, operations might like the technology in one bidder's proposal, but management might find that proposal does not support the company's goals.

And as I stated before, make sure someone is in charge. We think that the company's best interests are served if that someone is from management. They can best sell the project team's decision to senior management. But more important, they are best qualified to ensure that the winning bid meets the most important criteria of all - adherence to the company's business goals.

< Previous 1 2 3 4 5 6 Next >