Tuesday Marketing Notes (Number 82—June 4th , 2007)

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The RFP and Creating Proposals that Win (Part 1)

by Martin Andelman

Years ago, the RFP was a tool used only by large organizations when selecting suppliers. In today’s ultra-cautious business environment, even relatively small companies may issue an RFP and expect your firm to submit a formal proposal in response in order to be considered for the assignment.

From the issuing organization’s point of view, the RFP is intended to standardize the criteria upon which selection will be made. Developing the questionnaire forces the issuer of the RFP to commit to paper exactly what they are looking for from the supplier. Sometimes the candidates are given the opportunity to present their proposal, but in more and more cases, no presentations are held until the proposal responses have been judged. By using the RFP process to qualify candidates, the thinking goes, the issuer of the RFP saves time and increases the probability that an optimal selection is ultimately made.

Sometimes it works, sometimes not, but there is no question that the use of the RFP when going to market reduces the risks inherent to vendor selection and is here to stay. Few executives today want to explain why, assuming the relationship they have chosen later fails to meet expectations, they chose a given firm without being able to refer to a written document upon which the decision was made.

When it comes to responding to an RFP, companies fall into three categories:

1. Those who simply refuse to respond: These companies will tell you that “you never win those”, that “the process is too political”, that “it is a waste of time and a lot of time, at that”. Three strikes and they’re out:

2. Those who respond, reluctantly: These companies begin preparing their proposals by spending more time criticizing the RFP questionnaire and process than they do actually preparing their response. They never believe that theirs will win and it rarely, if ever, does;

3. Those who respond…and win: These companies either have developed and refined their proposal creation capabilities, or they bring in professional consultants to help them compile and package their response. They always believe that they have a good chance of being selected and they often are.

Why Your Firm Should Always Respond

If your firm is one that either doesn’t respond, or responds reluctantly, you’re missing the boat. An RFP is an opportunity to present your firm’s unique advantages as applied to a prospect’s specific needs, in detail, to a willing group of executive decision makers. Think of how hard it is to get four or five decision makers to read your company’s brochure. With the RFP process, they are now offering to read not only your firm’s brochure-type information, but to read and assess your in-depth capabilities, experience and history as it applies to their immediate and specific needs.

By preparing the optimal response to an RFP, even if you lose…you win. Here’s why:

• Those executives that reviewed your proposal are now intimately familiar with your firm’s background and abilities as related to their specific needs. Should this year’s winner prove to disappoint, your firm is infinitely more likely to be their next call than if you didn’t respond at all or responded halfheartedly.

• Perhaps your firm wasn’t awarded that particular assignment for whatever reason, but, due to the quality of your response, the issuing company may want to work with your firm in another area;

• Every time you prepare a formal proposal you get better at it. The first time may be a nightmare, but subsequent proposals are not only easier, but the output is significantly improved;

• Formal proposals force you to memorialize the specific strengths your firm brings to the table. Many times, during the proposal generation process, companies realize things about themselves, both positive and negative, that they may have known intuitively, but never saw in print.

Stop the Whining!

OK, so assuming you’ve now eliminated the idea of not responding, the next hurdle is to resist the temptation to criticize and complain about the assignment: “This question is ridiculous,” “They don’t even know what they’re asking for,” “What does that mean?” “Look how many typos there are,” “There’s no way we’re gonna win this,” “How can they expect this to be done in nine days?” Etcetera, etcetera, etcetera.

Complaining about the RFP process, demands, or content, beyond being a complete waste of time, can cause so much harm to your ability to prepare the optimal response that you might as well have declined to do so. It’s like those in school who were forever raising their hand during a test to complain about the question to the teacher who was forever responding by saying, “just read the question and answer it as you feel appropriate”.

Preparing the optimal proposal needs to be done gleefully. Here’s your chance to showcase your pride and joy to people interested in hearing about what makes your firm special. It’s an opportunity to shine. So don’t blow it by whining about it.

The Bar is Not Nearly as High as You Might Imagine

Never forget this fact: Let’s say that the RFP’s issuer sent the questionnaire to ten candidates. Guaranteed that two, three or four of those who receive it will fall into the “We don’t respond” category. Another three or four will respond reluctantly and therefore, poorly. Chances are that only two and at the most three of the ten firms given the opportunity to submit a proposal will even be in the running. You don’t have to be perfect to win, just better than the other guy.

How to Create Proposals that Win

First of all, view the RFP as a precious gift, not an unfair burden. The fact that a given organization wants your firm to complete a detailed questionnaire before being given the opportunity to present in person, is in no way an insult to your company’s credibility or stature.

The reasons for the use of the RFP process, which have already been touched upon, have nothing to do with you or your firm. Companies issue RFPs for their own reasons. Even industry giants like Dell, IBM, Deloitte & Touche, and Lockheed Martin are asked to complete RFP questionnaires. The fact that the RFP is demanding information that you feel is perfunctory, pedestrian or otherwise inappropriate is irrelevant. Either learn to play by the rules of the process, or spend the game sitting in the bleachers.

Next Week, in Part 2: Guidelines for writing the winning RFP . . .

Martin Andelman is the President of Mandelman, Inc., and author of “RFP Nation: How to Increase Your Firm’s Win Rate in our Proposal-Driven Business World.” He can be reached at 714-773-1093 or martin@mandelmaninc.com.