When your house is burning down do you send out an RFP to the all the fire stations requesting data on their staffing levels, quality of equipment, fleet management, capability matrix of firefighter skills, etc. No, you pick up the phone and dial 911 to dispatch fire fighters from your nearest fire station – you need action not analysis. The same analogy can be made for projects that are sent out to RFP versus those that are not.
My observations of this ubiquitous process of participating in enterprise RFP’s has been that they are:
- A future looking request for an anticipated future need
- A tool to validate pricing and process for a pre-selected vendor by opening the proposal out to bid to a broader vendor base
- An attempt to validate/ benchmark the process flows of internal teams by investigating industry best practices
- A means for sourcing groups to keep busy during down times when there is not an internal need for sourcing – giving them a reason to exist
- A strategic initiative by sourcing groups to learn more about a growing trend with competitors such as offshoring, to evaluate the applicability of the trend to their organization
What then is the magic formula for winning RFP’s. There is none but here are a few suggestions:
Know the stakeholder(s): Key relationships with stake holders is the single most important factor in winning RFP’s. As stated in the problems above, many if not most RFP’s are “inside” jobs where the stakeholders have already decided or are leaning towards favorites. You want to be in that in crowd. Relationships have to be established prior to the RFP stage independent of Sourcing intervention. Observe industry trends and shortlist the stakeholders of the future, then systematically reach out and network with them and crystallize relationships long before the RFP is inked. The holy grail is when an RFP is written with your key capabilities in the back of the mind of the stakeholders. Most large organizations as well as government agencies will forbid contact with key decision makers during the RFP “quiet period”, so make sure you establish these relationships earlier on. In many cases these relationships are what will end up inviting you to an RFP in the first place.
Establish subject matter expertise: If you have not had the opportunity to establish key stakeholder relationships, the RFP is also you/ your company’s resume. Establishing subject matter expertise and thoroughness/ completeness of responses is of paramount importance. During the question period ask relevant questions geared towards the key pain points of the customer not operational or technical details that can be figured out after you win the RFP.
Ask key discovery questions: Don’t assume key questions that provide insight into the playing field for the RFP will not be answered. Ask them anyways, questions like how many participants are there in the RFP, how many will be selected, who are the top participants, what are they key qualifications for the winning bidders, etc. You will be surprised how much clients will be ready to answer if only you asked.
Stay away from RFP’s that smell that RFI’s: if the RFP is too broadly defined without much details asking questions like “state your key capabilities in << fill in the blank>> , gracefully decline or have your analysts provide equally broad answers to the question that is enough to satiate the client. Move on..
To conclude, revisiting the fire in the house analogy, the best fires to tend to are those that are burning right now. The customer is ready for a purchase and fast. For future fires (business) invest time and effort now on identifying the trends that will cause those fires in future and establish relationships with that user base.