When project performance depends on how organisations will solve problems together, a written tender can reveal only part of what the owner needs to know.
The Victorian model Alliance RFP uses a staged selection process moving from expressions of interest to request for proposal, shortlist and an Alliance Development Phase. During that development phase, shortlisted proponents work interactively with the project owner to refine the solution, analyse risk, develop design, test the commercial framework and produce a final proposal including a Target Outturn Cost.
This is not merely a longer tender process.
It reflects a different selection problem.
A conventional tender often asks: Which supplier offers the strongest compliant proposal?
Alliance procurement must also ask: Which group of people can operate credibly inside an integrated governance and commercial system when uncertainty increases?
The Strategic Context
Procurement is usually designed to evaluate evidence that can be submitted in documents.
Experience can be listed.
Methodology can be written.
Price can be compared.
Insurance can be checked.
Financial capacity can be verified.
But some capabilities are behavioural.
Can senior leaders challenge each other constructively?
Can the team make decisions with incomplete information?
Can commercial specialists share cost data without using transparency tactically?
Can technical leaders integrate owner and contractor knowledge?
Can the team resolve disagreement without reverting immediately to contractual positions?
Those capabilities matter greatly in an alliance, yet they are difficult to establish through written claims alone.
What Leaders Commonly Misread
The first mistake is believing that alliance procurement should simply reduce emphasis on price.
The issue is not price versus culture.
The issue is whether the procurement process captures the full set of capabilities required by the delivery model.
The second mistake is assuming workshop performance proves long-term collaboration.
A well-prepared team can perform convincingly for a few days.
Interactive development provides better evidence than a conventional tender, but it is still a sample of future behaviour.
The third mistake is allowing relationship assessment to become subjective personality judgement.
The owner must evaluate observable behaviours tied to project needs, not who appears most agreeable.
The fourth mistake is allowing the development phase to create hidden incumbent advantage before the final commercial decision is made.
Reframing the Issue
Alliance procurement should be understood as progressive evidence gathering.
The owner learns more as the relationship deepens.
The proponent also learns more about the project.
This means evaluation should change across stages.
Early stages can test organisational capability, experience, financial standing and basic alignment with the commercial framework.
Later stages can test actual team behaviour, leadership, design development, risk thinking, collaboration and commercial realism.
The final decision therefore becomes richer than a single tender score.
Strategic Analysis
The Victorian model illustrates this progression.
Initial proposals assess areas such as project experience, design and construction capability, people, culture and philosophy, legal/commercial acceptance and risk management.
The Alliance Development Phase then goes deeper. The owner can observe workshops, leadership behaviour, team integration and the ability to develop a credible project solution and TOC.
This creates a more realistic test of capability.
But it also increases probity complexity.
When two shortlisted teams interact closely with the owner, information flows must be controlled. One proponent should not receive another’s ideas. Owner staff need clear protocols. Clarifications and collaborative sessions require disciplined documentation.
Interactive procurement therefore creates both better evidence and greater governance burden.
The Enterprise View
The model is particularly relevant where supplier selection determines more than delivery capability.
In an alliance, the selected partner becomes part of the project's governance system.
That means leadership is effectively selecting:
- a commercial counterparty;
- a delivery organisation;
- a leadership team;
- a cultural partner;
- a source of technical capability;
- a participant in shared decision-making.
The cost of selecting the wrong partner can therefore be much greater than selecting a weak supplier under a conventional contract.
Decision Framework
A strong alliance selection process should test six dimensions.
Organisational capability
Can the organisation deliver work of this complexity and scale?
Leadership capability
Can nominated leaders operate in an integrated decision environment?
Relationship capability
Can the team listen, challenge, negotiate and solve problems constructively?
Technical capability
Can the team develop a credible solution under project uncertainty?
Commercial capability
Can the proponent operate transparently within the proposed risk/reward framework?
Integrity and consistency
Does observed behaviour during interaction match written commitments?
The owner should define evidence for each dimension before interaction begins.
From Strategy to Execution
Immediate action: design alliance evaluation around observable capabilities, not only tender-document quality.
Medium-term capability building: train evaluation teams in behavioural observation, structured interviews, workshop assessment and probity management.
Long-term strategic positioning: compare partner-selection evidence with actual alliance performance. Determine which observed behaviours predicted later success or failure.
This can significantly improve future procurement design.
Signals to Monitor
Warning signs include workshop assessment becoming informal, evaluators favouring charismatic individuals without evidence, shortlisted teams receiving inconsistent information, commercial concessions being made during interactive sessions without governance, or the owner becoming emotionally committed to one team before final evaluation.
Another signal is a final recommendation that gives high weight to “culture” without explaining what was actually observed.
Questions for the Leadership Team
- Which capabilities cannot be evaluated reliably from a written tender?
- What behaviours should be observed during the interactive phase?
- How will evaluators distinguish collaboration from presentation skill?
- How will information be controlled between shortlisted proponents?
- What evidence would cause us to reject a technically strong team on relationship grounds?
- How will commercial realism be tested before final selection?
- Are we selecting a supplier, or selecting a temporary enterprise partner?
Closing Perspective
Alliance procurement is more demanding because the owner is selecting more than a contractor.
It is selecting a participant in governance, risk, leadership and integrated delivery.
That justifies deeper interaction, but only when the process is structured strongly enough to turn behaviour into evidence and collaboration into a defensible commercial decision.
Related article: Alliance Contracting Is a Governance Model, Not a Trust Exercise
Related article: The Decision Rule Comes Before the Score: Designing Tender Evaluation from the Outcome Backwards
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