Avoiding Allentown: Ensure a Transparent RFP Review Process
“Covert recordings, political bribes, raided offices and now, federal indictments. An FBI probe is dismantling an entire political administration after uncovering deep corruption within.
"But these politicians aren't in Congress or even in a state governor's office. This scandal is ripping through the tiny city council of Allentown, Pa., and the FBI is throwing everything it's got into the investigation.”
It's no April Fools' joke.
Just a couple of months ago NPR covered the scandal of Allentown, Pennsylvania and their allegedly rigged bidding process and how it resulted in federal indictments.
It’s also poignant reminder of why we need to ensure our own sourcing process is transparent and compliant.
Corrupt competitive bidding?
The gist of the tale is this:
An FBI probe raided the office of 3rd term Allentown Pennsylvania Mayor Ed Pawloski, as part of an investigation to determine the connection between big federal contracts and the Mayor’s political campaign contributions.
Pawloski, who was running for Senate at the time, had worked to bring about a state law which created significant incentives for businesses to relocate to downtown Allentown.
The initiative was extremely popular.
However, the FBI came to find that several of the businesses who received the incentive were also significant donors to Pawloski’s political efforts.
The NPR article stated:
After a close ally of the mayor wore an FBI wire, it became clear that Pawloski himself had rejiggered the city's bidding process. According to the charges, he was making sure those big contracts went to the right companies.
...the FBI is investigating everyone from the chairman of the Pennsylvania Democratic Party to at least one big-time fundraiser in national politics - Jack Rosen. He's raised serious money for both Clintons and Barack Obama. Oh, yes, and Allentown Mayor Ed Pawlowski. Jack Rosen's businesses have also made a lot of money in Allentown. Attorney Eric Dowdle says this might explain why all the federal scrutiny.”
Former Allentown city Controller Mary Ellen Koval along with two other city employees pleaded guilty to the fraud charges.
Despite the allegations and unanimous city council vote asking him to resign, Pawlowski remains the mayor and is fighting to keep it that way.
One of his lawyers, Jack McMahon, recently spoke out arguing the Mayor was innocent and had been largely ignorant of the goings-on.
McMahon said it was actually Pawloski’s former friend campaign manager Michael Fleck who was the “‘main mover and shaker in a lot of this…’”
And that Pawloski “‘wants to let the citizens of Allentown know he’s not going anywhere; he’s not resigning.'"
Pawloski continues to fight the implications, and is working to restore his name and reputation. McMahon refutes that nothing that would be “construed as pay-to-play by Mr. Pawlowski.” And that he doesn’t believe his remaining the mayor is hurting the town:
“‘Development is coming in, new investors are coming in all the time.’”
Meanwhile, the grand jury investigation continues. (Read more about the story here).
What does this have to do with my vendor selections?
Regardless of what comes of the investigation, it clearly highlights the critical need for transparent RFP processes.
The Allentown debacle was not an isolated incident, the Pentagon itself recently launched an investigation into its space contracts.
And while these potentially biased and/or corrupt government bids are certainly extreme examples, they serve as an important reminder.
They remind us that not only do we need to be honest, but also explicitly clear in our selection events about who we invite, why we chose those vendors, and details of the engagement.
It’s a reminder to ask what you could be risking in your sourcing and RFx processes.
We often talk about the risk of going digital, and the hesitancy of putting our data and systems on the cloud.
But what about the risk of keeping things manual?
The big problem with status quo methods like a manual RFP process is the lack of a clear backlog or audit trail. The list of vendors you invited to bid, their responses, and supplier evaluations are too often scattered across endless emails, Excel files, and PDFs.
Trying to find accurate records from an event one, two, or three years ago is not only tedious, but can even be impossible.
Too often our vendor management process isn’t transparent, even to ourselves.
But effective e-procurement tools can help restore peace of mind, because you know you can access bid history whenever you need it. (Track invited suppliers, the responses, and how they were evaluated). In other words, built-in transparency and compliance.
The beauty of making our supplier management more digital is there is a clear history of each sourcing event.
Ultimately, the Allentown investigation is a wake-up call that sometimes vendor risk management starts with our transparency.
**Photo Credit: Ryan McGuire, Gratisography