Large non-profit wants to analyze and lower the operating costs associated with various contracts already in place.

Current State and Challenges:

The Executive Director wants to do an evaluation of the cost, terms and scope of work in place related to some of the existing contracts with current vendors. and their related procurement practices. Since the operation and finance divisions are dealing with a multi-million-dollar budget, it is imperative to make sure the procurement process is airtight, and they are acting in the most fiduciary way on behalf of the organization.

Process:

OTP meets with the client to review various contracts. OTP obtains copies of current invoices/contracts related to the expense categories and analyzes their cost, terms and arrangements based on proprietary and proven methodology. This analysis reveals that in most cases the non-profit is not receiving the best solutions or pricing on some of these contracts already in place. OTP discovers that the scope of work has changed drastically in some departments but has not been reflected in the procurement and contracts. By creating a more accurate scope of work and defining the actual needs and requirements, OTP can source out the optimum contractual terms and conditions. OTP implements a new RFP procedure to promote more competition from the vendors and conducts a comprehensive comparative analysis of the received proposals for the client to make the absolute best decision for their organization.

Results:

The Executive Director has a senior management meeting to focus on OTP’s findings and results. The contracts are Stringent controls, and a good process is put in place moving forward. The non-profit realizes a saving of over $100,000 in the first year of the new contracts’ implementation and over $500,000 for the term of the agreement.