The RFP Ritual ... Should You Respond?

Tuesday, August 11, 2009

With more businesses using technology to purchase services, the Request for Proposal or "RFP" has definitely become a popular vendor selection tool. I must admit that in our industry, the RFP is very common and a large portion of non-billable hours is put towards writing these proposals.

But is it worth it?

Here is some great information about RFP's - from both the issuer and vendor perspective.

The Issuer - Many companies use the RFP process to achieve the following goals:

To get an apples to apples comparison
To promote open and fair competition
To receive competitive pricing and alternative solutions
To get a wide range of submissions
To receive non-sales documentation of the solution

The Vendor - Some of the RFP advantages for vendors are as follows:

A small business can compete with a larger business
It allows vendors to offer their services to a larger geographic audience
Connections or "who you know" matters less
You can be rewarded for your innovation and expertise
You have a true opportunity to highlight your strengths

Seems pretty clear cut right?

Well if you are a vendor, there are some best practices you should follow! Make sure you remember the following things when responding to RFP's:

You should be able to quickly engage the reader in the first thirty seconds
You must convey why you are the best choice for the project
Ask lots of questions - and be positive that a vendor without a previous relationship has a chance to win the business
Do not try to be the lowest bidder
Do not try to be the firm that can do it all
Do not try to wow them with your management teams bios
Show the issuer that you are the best team for their project - and that you have done many successful projects that are similar to theirs in scale and scope.

Best Advice for Issuers - If you are opening up your RFP to the masses (commonly known as the cattle call), send out a Request for Information or RFI first and request a 2 to 5 page summary of the company. Use this document to select your top few companies and then issue a full RFP from there.

Take time to do your internal research and think about the business problems you are seeking to solve. A poorly written RFP, will result in poor responses in both quantity and quality! Clearly define the proposal process, the format and the information you are seeking.

Best Advice for Vendors - Remember that you are not re-inventing the wheel here! Look to others that have written successful RFP's and see if you can take any tips from them. If you are really bold ... get in contact with them and ask for advice. There are also many online resources out there.

The RFP is not going away - so you have two choices: