Any company or government agency needs goods and services provided by other business entities. To fulfill the need, the said agency, department or company, opens its doors to procurement or sourcing the best possible product and service from the best company that will deliver the said offer/s.
Before any entities begin its procurement process, it needs to have a Request for Proposal (RFP) from interested parties. With regard to the Request for Proposal, compliance matrix is a part of this document. Compliance Matrix is a document that brings details to the actual proposal and a help to the procurement process. It is also called as Requirements Traceability Matrix (RTM). This document specifies the section and volume with regards to goods and services needed. In addition, there is also the specific page where the requirement or need is being addressed.
Request for Proposal, in turn, is a document that a company interested in procurement publishes or sends out to vendors who might be interested in fulfilling the needs outlined in the compliance matrix. To put it simply, a compliance matrix is like an inventory of things needed for a particular department or division. Another good comparison is a grocery list to a household.
Compliance matrix is helpful for a small business attempting to procure for the company. It serves as a list of needs and a reference guide in terms of evaluation and validation of the goods and services rendered to the particular section and the company as a whole. Compliance Matrix makes things easier for both parties in compiling to each other’s goals. Another added benefit of compliance matrix is transparency. A company is being open about its needs and the other company gets validated for their work. Using a compliance matrix in creating a RFP compliant is definitely a good and productive method for both the company that needs the procurement and the other business that will be the provider. Submitting a RFP compliant proposal increases the chances for the potential provider to be considered and selected for the procurement project.
Creating the Matrix
The compliance matrix has two parts. One part is the list of requirements or needs and the other is the section for compliance of the business contacted for procurement. Information provided by the company in need is crucial in creating the matrix and the company which will render the services must treat the information carefully.
Since the information is given out, interested companies can make their own proposals based on the information given.
Aside from the content, there are few areas of concern that a proposal writer or business owner should consider. They are:
- Instruction with regard to organization of the paper
- Clear structure and organization of content
- Compliance with all requirements
- Best presentation and layout of the offer in the paper
To put it simply, a compliance matrix is a table that can be divided under two headings: RFP Requirements and Compliance. Under the requirements, specific information like paragraph number where the requirement is stated, the specific item required and the requirement itself. On the other column, Compliance includes the value and margin of the requirement. Other information includes a Yes/No Compliant question and an optional comment regarding the requirement.
Here is a visual example:
With these two headings, the matrix presents clear and concise information for both companies. There is no standard form of creating or writing a compliance matrix. The matrix’s form and structure depends on a company’s requirements, reference of organization and style. Industry, scope and size also play a role. The larger the company or the requirements might need a more complicated matrix. Related attributes of items and requirements might also add a column or two under the two main headings. The company can customize the matrix on many factors.
Why Compliance Matters
Compliance is a very important issue, especially in procurement. A company opening its doors to procurement expects its vendors to coordinate fully and fulfill the needs as stated in the proposal or contract. A lot of resources are involved – time, personnel and money (supplies, equipment etc). A business that cannot comply with compliance wastes a lot of these resources and the trust of the company it’s serving. Compliance is also a form of a business’s ability and performance in delivering what is needed for the right price.
On the part of the company in need, compliance resonates transparency and corruption, especially in the part of sourcing materials and services for the company as a whole.
