I can only say, based on my own short experience as purchase manager, that the process looks something like this: 1. The company needs to expand / upgrade / wh

I can only say, based on my own short experience as purchase manager, that the process looks something like this: 1. The company needs to expand / upgrade / whatever, and there's a meeting on how this should be tackled. More often than not, in large companies, this part is also delegated to some consulting firm. 2. Report from said firm comes in, you have a meeting, and either go with their recommendations, or something else which has come up internally. 3. Upper management is convinced that using outside consultants / contractors is the way to go, because it's lighter on the company (no hiring, etc.) 4. Upper management gets wined and dined by the largest players, and are convinced its better to go with the most establishes firms. Often times they have good relationships with these firms from beforehand, and don't even bother checking out their competition. I've been myself in the situation where we spent months on coming up with the best deal possible, only to get steamrolled by executives, because they wanted to go with someone they knew - and pay many multiples extra. In the end, it's the tax-payers or shareholders that are paying for this kind of stuff.