Your company needs to develop technical expertise and you are wavering between internal proficiency training and recourse to an external contractor. The second option doubtless appears more expedient and efficient provided, of course, that you choose your contractors wisely.
Do understand, however, that searching for a contractor does not mean applying the oversimplified rule of opting for the lowest bidder. A number of important factors specific to your project and your sector of activity must be taken into consideration.
Ideally, you will wish to devise a rigorous evaluation and selection process based on your company’s individual priorities and strategies. To simplify matters for you, we have drawn up a list of ten key points to consider when searching for a contractor.
1. Study Your Market
First off, it is recommended that you draw up a shortlist of possible contractors. Begin your search on the Internet, focusing on trade association directories and publications as well as contractor management software.
Upon completion of this initial phase of your search, you will have a good idea of the contractor market available to you.
2. Focus on Your Needs
The primary attribute of a good contractor lies in the capacity to fulfil or surpass your needs. A good contractor will indeed help propel your company forward. This is why it is important to avail yourself of a mechanism for evaluating performance and distinguishing between good contractors and excellent contractors. By choosing to seek out only the best, you will transform your contractors into partners poised to contribute to the success of your company over the longer term.
3. Prioritize Risk Management
This is a critical point to consider in your search for a contractor. Are your contractor candidates properly certified and accredited? Do they measure up in terms of environmental performance? Do they ensure that their employees receive the proper training and maintain trade certifications and operating licences current? More importantly, do they make the effort to comply at all times with applicable occupational health and safety legislation and regulations?
Always pay particularly close attention to risk management. As a hiring organization, you are responsible for actively managing all manner of risks, even when you choose to outsource certain activities. You will want to ensure that you remain sufficiently involved to avoid costly or fatal errors…
4. Check Candidate Reliability
Should a contractor leave you high and dry, you are the one who will suffer the consequences. You are therefore well advised to check candidate reliability before placing your trust in them. To do so, you may want to inquire with previous clients and partners. You can also ask around within your network of professional contacts.
Does your candidate have experience in your field? Can your candidate substantiate this experience? Does he have a well established client base? Does he have a sound portfolio of past achievements? Has your candidate been involved in serious safety-related or environmental incidents or accidents? It is your responsibility to conduct your own investigative search to ensure that you can indeed place your trust in your prospective business partner.
5. Check for Financial Soundness
Continuing in much the same vein, do not hesitate to substantiate the financial soundness of potential contractors. Should a chosen contractor go bankrupt midstream into a job, you could be saddled with some serious headaches. You could, for example, be required to pay unpaid dues or other amounts owing worker compensation organizations in the event of contractor insolvency.
To avoid nightmarish scenarios of the like, request proof of compliance from the organization responsible for enforcing the labour laws that apply to your chosen contractor. You may also wish to request financial statements from previous years or require a financial investigation. A bond might be an interesting avenue to consider to protect yourself against the consequences of contractor bankruptcy.
6. Manage the Contractor Supply Chain
One of the realities to which you expose yourself when outsourcing to a third party relates to the multiplication of stakeholders. Indeed, your chosen contractor could similarly contract work out to fulfil your demands.
It is therefore important to inquire whether or not your chosen contractor will be subcontracting any work. If so, require that your contractor employ the same contractor risk identification and management practices that you yourself employ. The object is to provide a cascading process that ensures proper oversight of risks and matters of regulatory compliance.
7. Select the Proper Means of Communication
Before being able to institute open, effective, two-way communication with your contractor, it is important to know how best to contact the latter. Nowadays, forget e-mails and telephone calls which require that you regularly update information in a manual or electronic journal or tool every time that your contact changes extension number or physically moves.
Some specialized software packages enable you to find your contractor, communicate with the latter and remain in contact without any monitoring or updating efforts on your behalf. Hence you stand to decrease considerably the time required to conduct your contractor search activities.
8. Consider Contractor Location
Depending on the nature of your activities, candidate location can prove an important criterion when searching for a contractor. Physical proximity to a contractor can facilitate exchange with the latter. In some cases, physical proximity can also enhance responsiveness and trim delivery charges.
The benefits of establishing long term relationships with your contractors are multiple. Over time, intercooperation becomes natural and provides for ongoing improvement.
By employing a contractor management system, you will be able to define a process and clearly convey expectations and priorities to your contractors. Going forward, you will benefit from the documented monitoring of contractor performance. By working on issues provided through feedback, your contractors will know which aspects of their involvement are in need of improvement. You will be surprised at the progress made as the months progress.
10. Measure the Price-Quality Ratio
As we indicated at the outset, price is not everything when searching for a contractor. Indeed, far from it! In the price-quality ratio lies the ever important notion of quality. And these are not the only two aspects. Scheduling represents an equally critical aspect of any project.
You will therefore appreciate how your choice of contractors directly impacts the infamous project management schedule-budget-quality triangle. Do bear in mind, however, that failing full compliance with applicable legal obligations, health and safety standards and environmental protection regulations, your efforts to optimize schedule-budget-quality are meaningless.
Rather, you must seek out quality at reasonable cost and within a reasonable timeframe without compromising other aspects intrinsically linked to the success of your project.
It is pointless to retain too great a number of candidates. Between 3 and 5 potential suppliers should suffice and enable you to make the rare find that you are seeking to substantiate. By limiting yourself accordingly, you will avoid wasting precious time meeting with potential contractors who have little chance of proving a good fit.
When you reach the request for proposals stage, you will be poised to review and assess overall criteria in greater detail, and prioritize those most important to you and the future of your company.