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5 Rules for RFP/Bid/Tender Success

Posted by [email protected] on June 20, 2012 at 10:50 AM

Ah, the corporate procurement process. Like pulling teeth, only less pleasant! The bigger the company you’re selling to, the more likely it is you’ll have to complete a never-ending set of increasingly complex procurement documents. They’re designed, in theory, to identify the best possible products/service providers at the best possible value but appear to have actually been created specially to drive sales, pre-sales and bid-management teams into an early grave!


The actual procurement documents themselves come in all shapes and sizes and every company seems to call them something different – RFP (request for proposal), RFQ (request for quotation), ITT (invitation to tender) etc. If you’re dealing with a government contract, you’ll probably have to go through a separate hurdle like a PQQ (pre-qualification questionnaire) just to win the right to be included in the invitation. Sometimes a bigger tender will be divided into “lots”. And if you’re REALLY lucky there’ll be a practically impenetrable procurement portal for you to use to upload your documents.


Yes, the RFP process can be frustrating and incredibly time-consuming. So here’s my five point plan for avoiding the most obvious pitfalls:


1.       Qualification, Qualification, Qualification

Before you spend a single moment completing an RFP response, you should ask yourself with brutal honesty, “Do we have a realistic chance of winning this pitch?” If the answer is no, then don’t waste your time. Far, far too many companies throw away their precious time jumping through the hoops of creating complex tenders/RFP responses even though their product is a bad fit, they are battling an incumbent who is never going to be unseated or they have no prior relationship with the company issuing the RFP.


The problem is often that the decision on whether to bid/no bid is taken by the sales team – who will bid on anything in the hope of hitting their number. But it’s far better to do a GOOD job of a FEW, winnable RFPs than to stretch yourselves thin doing too many no-hopers.


I would recommend that bid/no bid decisions should only be taken after the RFP has been reviewed by the following functions within your business:

  • Product Team – does your product DO (or could it realistically be enhanced in the right timeframe to do) what the customer wants, or are the sales team trying to squeeze a square peg into a round hole?
  • Services Team – do you have (or could you hire) the relevant staff to deliver the kind of project the customer is asking for, or would a win on this project actually be a disaster that leads to you failing to service your existing customers?
  • Legal – does the RFP contain/flag up any legal conditions that would be a deal-breaker? There’s no point breaking your neck to win a pitch only to find your legal team will point-blank refuse to sign the proforma contract that was included in the RFP.

Graham Laing’s excellent blog post has more on this topic. 


2.       Read the Instructions

And then read them again. Yes, this sounds obvious. But it’s astonishing how many bid teams rush headlong into filling in the questionnaires and pricing spread sheets of an RFP without taking the time to read the instructions.


At a basic level, you need to watch out for the all-important deadline for submission and any interim deadlines for submitting questions. But there are often other requirements that can catch you out – many RFPs insist on the use of a certain form of words in EVERY section of the response - e.g. “comply”, “non-comply”, “partially-comply”. This is often used by the procurement team to filter responses in order to see which responses meet an arbitrary level of compliance at which a “first cut” is made. Imagine the frustration of completing a fantastic RFP response but losing out because you’d written “yes” in every box and not “comply”?


3.       Answer All The Questions

Faced with a 400-line requirements spread sheet and a seriesof questions that seem to need vaguely similar responses, it’s often tempting to assume that you don’t need to say the same thing twice. You’d be wrong. Chances are that the different sections of your response will be reviewed by different teams (procurement, technical, operations, finance etc.) and the reviewer of a particular section probably won’t have read your previous answer (no matter how eloquent!). Make sure you answer EVERY question, even if only with something that directs the reader to another response - eg “see our response to question 1.2.6 above” - or something vague that doesn’t close the door on a difficult topic  - “this is not currently supported by our product but we would be happy to discuss its inclusion as a roadmap item”.


4.       Don’t be afraid to say No

A wise and highly-successful sales guy once told me that a customer would never respect you until you’d told them no: "No, our product doesn’t do that, but it does all these other things…". "No, we don’t have the manpower to do that for you by tomorrow, but we’ll do it by next week…". The same rule goes for RFPs. When a company is putting together its list of requirements for an RFP you can be sure they’re throwing in the kitchen sink (even if they don’t need it and can’t afford it anyway) so if you don’t/can’t/won’t meet a particular requirement, don’t be afraid to say so. Hopefully, you’ll have followed step one above (qualification) and will have enough of a relationship with the customer to know which the deal-breaker requirements are.


If there’s something that you get asked for all the time in RFPs that you can’t provide, think hard about finding reliable partners who can meet that need so you can recommend them in future responss – perhaps a company whose complementary product can be integrated with yours, or a service provider who can customize your product to meet the client’s exact needs.  


5.       Provide a pricing breakdown

Complex projects usually require complex solutions and if it wasn’t a complex project you probably wouldn’t need a tender process. It can be tempting to leave the pricing to the last minute when you’re more clear of what products/service hours are involved. And we all know sales people who (if their company’s pricing policy allows it) will just bung in a figure at the last minute that looks about right and hope for the best. But you can be sure that the first thing a procurement team will do is flick straight to the pricing, so don't leave yourself open to a bad case of sticker-shock that sees your beautifully-crafted response rejected before it's even been read.


Start working on the pricing right at the beginning. Update it as you review the requirements and realise that additional products/modules/service hours are required. And give the customer a breakdown EVEN IF THE RFP DOESN’T INSIST ON IT. This will allow them to see where their money is going and help them to establish what elements of your product/service offering represent better value for money than those of your competitors.


Overall, when completing your bid/tender/proposal, ask yourself - what is the customer looking for? Then try to provide it!


If you'd like to talk about how RHJ Media can help you produce better proposals, bids and tenders, please contact us.

 

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