I had a colleague ask the question of whether or not benchmarking organizations like Gartner could be / should be the starting point for negotiations versus following a competitive bidding process.  It’s a worthy and important question since, as procurement pros, we need to provide exceptional customer service and, therefore, must always seek out alternative ways of doing business.

Some folks get hung up on competitive bidding versus an RFx...  Are they the same or different?  There is a distinction (in my mind) between competitive bidding and an RFx. Competitive bidding is a "philosophy" and an RFx is one of many tools to fulfill that philosophy. With that said, there are a number of reasons to issue an RFx, the two important ones being as follows:

1. To create competition or an illusion of competition (as a means to create negotiation leverage).

2. To ensure that the internal customer has reasonably articulated what his / her needs or desires are.

Within the context of an RFx, the process could be simple and short (in my opinion, an e-mail with requirements could even serve as an RFx) or more formal and lengthy (such as having pre- and post-proposal conferences, etc.)

As a procurement pro, I have the responsibility to source the required product / service at the requisite level of quality / performance at the most reasonable cost while at the same time minimzing legal and business risk. That responsibility can be accomplished in any way that is ethical and within policy.  In my organization’s policy, I require an informal RFx for anything between $50K and $100K, and a formal RFx for anything $100K or greater. Of course, there have been exceptions to that policy, which require the completion of a Bid Exception Request Form and CFO approval.

In the cases of bid exceptions, I have used benchmarking organizations and have negotiated from that point. Keep in mind that Gartner et al are really good, but not infallible, in their benchmarking. Many a vendor indicated as a leader in Gartner's magic quadrants have *poof* "magically" disappeared.

In most, if not all of those cases where I have used some sort of benchmarking instead of competitive bidding, I have certainly had less negotiation leverage than if I had issued an RFx and I probably spent as much time, if not more, than an RFx would have taken trying to fulfill my professional responsibility.  Further, because I typically include my contract template as a part of an RFx, I didn't have the benefit of a contract redlined by the prospective vendors in advance of conducting more serious negotiations.  However, my customers don’t view it as taking more time (even though it usually does) because they’re “seeing” vendors much earlier in the process than under a competitive bid—it’s psychological.
 

Certainly, with using benchmarking organizations like Gartner, one could perhaps expedite the process of procurement while maintaining its integrity. For example, by requiring that prospective vendors submit quotes and a response to your contract template before proceeding to more serious negotiations.  But, in short, I don't recommend that using benchmarking organizations as a starting point for negotiations be a policy or a practice. Rare occasions, yes, but otherwise, not so much.