Qualifications-Based Selection
The OAA recommends the use of the Qualifications-Based Selection (QBS) procurement process (sometimes also known as Quality-Based Selection), for selecting the most appropriate team of professionals for architecture services.
Under this approach, the most appropriate team of professionals is chosen based on qualifications such as knowledge, skill, previous experience with broadly similar projects, and other factors like the quality of the proposed approach and ideas for the project. This leaves fair and reasonable fee considerations to be addressed through a negotiation with the top-ranked team for an agreed-upon scope of services. In other words: select the most qualified candidate first and then negotiate a fair price.
When an architecture team is chosen using the QBS process, studies show clients benefit from fewer project delays, fewer cost increases during design and construction, and greater project satisfaction.
When defining the qualifications of an ideal team, the OAA recommends a holistic approach. While past performance and a long list of credentials are important, expanding criteria may uncover innovative design solutions or a better fit for your project. This approach helps ensure the right team is considered for the job based on several critical factors rather than just price—a decision that benefits the owner and users of the finished project.
Implementing QBS can be as simple as using your existing RFP documents with “price” weighted as 0%, along with employing a more rigorous scoring rubric. (A budget range can still be disclosed to participants.)
In addition to the sections below, if you are a public-sector owner, check out the Guide to Design and Construction Procurement Best Practices, developed by the Construction and Design Alliance of Ontario (CDAO), of which the OAA is a member. Developed by leaders from Ontario’s construction, design, planning, and engineering sectors, it provides practical recommendations to strengthen how infrastructure projects are planned, procured, and delivered.
The OAA has also helped fund a 2022 update to a U.S. study, Updated Analysis of QBS in the Procurement of Consulting Services, marking the first time Canadian QBS data was examined to assess its benefits in a local context.
For an overview on how the QBS process works, you can also watch this video developed by the Association of Consulting Engineering Companies (ACEC).
With QBS, a team is selected based on its qualifications to do a project, instead of the lowest bid. In this approach, the Request for Statement of Qualifications (RFSQ) process is almost identical to a Price-Based Request for Proposal (RFP) process, except that it does not request a price from the vendor. In some instances, clients may still choose to disclose an approximate budget to proponents so they can provide more detailed information in their proposals about things such as team members, process, and timelines.
Once the most qualified team has been identified through the RFSQ process, price and detailed scope negotiations are undertaken with only the most qualified team.
In QBS, during the pre-award scoping and budgeting negotiations with the most qualified team, cost drivers and cost-reduction opportunities such as Construction Contract Administration can be appropriately discussed and dealt with before the project is awarded—instead of using change orders part-way through the construction when it is most difficult to address. (Learn more in the Toronto Metropolitan University (TMU) Centre for Urban Innovation (CUI) report, commissioned by CDAO, “Impacts of Pre-Project Investment and Quality of Documents.”)
Having already invested in the selection process, the most qualified firm has a significant incentive to provide a fair price—otherwise their negotiations will be terminated, and the client will engage with the second most qualified team. In this way price is kept fair, while quality is kept high.
What is not QBS?
Any procurement methodology that evaluates price as part of the selection process is not QBS—even if price is just 5% of the assessment. While QBS does evaluate price, it does so after the most qualified architecture firm has been identified. At that point, the firm cannot win the project with a low price, but it can lose the project with a price deemed too high.
Other examples of approaches that are not QBS include “Best Value” (a generic procurement term that usually just means “price-based”) and any RFP that includes price as part of the evaluation process, even when qualifications are also included.
QBS has been recognized globally as a procurement process that results in clients hiring the most appropriately qualified architecture team, at the fairest price, with the least project cost over-runs.
When price is even a small part of the evaluation process, respondents to an RFSQ may find themselves proposing stripped-down pricing for the least viable, least innovative version of the project, knowing that the real cost of the project is likely higher, and that unevaluated criteria like reducing long-term operating costs will be overlooked to reduce the price of the proposal.
These short-term cost-reductions at the proposal stage can exponentially multiply long-term costs to a client, especially considering that design fees are only a very small percentage of the total construction cost despite determining the cost of the overall project, including its long-term operation and maintenance. As well, low-cost proposals can be a key driver of change orders during the project, leading to cost overruns and impacting the relationship between clients and consultants.
A joint research study by the American Public Works Association (APWA) and the American Council of Engineering Companies (ACEC) in partnership with The University of Colorado and Georgia Institute of Technology, shows that when architecture firms are hired using the QBS process, clients benefit from fewer project delays, fewer cost increases, and greater project satisfaction.
In the United States, the Brooks Act has made it illegal since 1972 to use price when selecting architects and engineers for federal contracts. Since then, almost every state has also implemented similar legislation.
Beyond the OAA, APWA, and ACEC, other organizations around the globe identifying QBS as a beneficial selection process for architecture clients includes the Federation of Canadian Municipalities (FCM), the Royal Architectural Institute of Canada (RAIC), and the American Institute of Architects (AIA).
While the OAA recommends the use of QBS when selecting a team for a project, other alternatives include referrals from other clients or other Architects, or simply hiring a team with whom you have previously worked. There is also the possibility for endorsed or non-endorsed architectural design competitions.
The Price-Based Request for Proposal (RFP) process is a procurement model best suited for commodity products where all product or service variables can be clearly defined, leaving price as the only differentiator. The OAA does not recommend its use for the selection of an architecture team.
“Best-value procurement” is a term often used as a synonym for Price-Based RFPs. True “best-value” procurement has much more rigorous scoring rubrics than a Price-Based RFP, but still evaluates price as part of the initial selection process. Although an improvement over a Price-Based RFP, it may suffer from the same low-bid issues as any other selection process that includes price as an initial selection factor.