This post shows how to make that summary easy to consume and responsive to your prospect’s issues.
Organizing your cost/price summary
Structure the summary around 3-5 themes important to your prospect. Themes vary by industry and project type, but common examples include price reasonableness, total cost of ownership, costs aligned to progress payments, risk of overruns and/or non-performance, return on investment, etc.
Present the information at a high level and aim for a 50/50 balance of text and visuals.
Rich visualization gives evaluators fresh perspectives on your price and builds comfort. Your goal is to make the evaluator’s job easier, not to complicate it.
Cost/price presentation examples
Use these examples to stimulate your thinking, and then decide what will work best in your situation.
Over time: Show costs broken out by major milestones and/or project segments Purpose: To show affordability, alignment with progress payments and/or possible divisions between budget categories (e.g. capital vs. expense items).
Compared with similar projects: Use a table and visual to present costs of recent projects of similar size and scope to the current project. Purpose: To show price is realistic and competitive
How estimated: Diagram your estimating process Purpose: To reinforce that your price is cost-based and carefully calculated, so the prospect understands your price is realistic and any contracting negotiations must be logic-based.
By subcontractor: Use a pie chart to show the relative size of contracted segments, together with information on each contractor. Purpose: To show how costs are allocated, emphasize competitive selection process, contractor capability and low non-performance risk.
Including trade-offs: Use a table to show options and how each decision impacted cost and price Purpose: To show how cost/price decisions align with the prospect’s strategic drivers and hot button issues. Also use to ghost competitors’ price offers.
Return on investment: Use a graph to show value added, compared to project costs Purpose: Where your solution will increase sales or reduce costs, to show a comparison of costs and related profits/savings over time
Add a selling caption
For each visual, include a selling caption to stress the benefits it conveys. Write these so they can be cut-and-pasted into an evaluator’s summary.
Because price is always important, it makes sense to invest in presenting it as favourably as possible. Despite this, many companies relegate price to a single number at the back of informal proposals and submit only the issuer-supplied pricing forms in formal bids.
A better strategy is to give your price the prominence it deserves.
Informal proposals (solicited without an RFP process), and many private sector RFPs, call for a single document that includes both the solution and price. In these cases:
Include your price in the executive summary. The belief that burying the price quote will force your buyer to read the proposal is false. He or she will read a page or two at most, then flip to the back to find the price. That brings us to the next point.
Present your price favourably. Use the executive summary to telegraph that your quoted price is logic-based and competitive, and then make the detailed case in the pricing section.
Remember: Almost always, the person who solicited your informal proposal needs internal buy-in for the purchase. Anything you can do to help—and avoid involving other vendors—is worth the effort.
Include a summary with your price submission in all large RFPs. Do this unless the RFP specifically forbids including additional material in the price binder.
This practice has at least three benefits:
Creates an executive summary for senior decision makers. Senior people seldom read pricing tables, which are often highly technical and complex. A plain language summary, including visualization, increases your chances of getting senior-level attention to price.
Sets up a positive evaluation. A well-crafted summary creates context and positions your price as carefully reasoned and organized.
Makes it easy for evaluators. The team evaluating prices on complex RFPs usually need to prepare a written summary with their recommendations. An ideal way to think of your summary is as cut-and-paste content for evaluators to include in theirs.
The goal in your informal proposal is to close the sale without involving competitors. In a formal RFP response, you want to show your price covers all requirements, is reasonable and realistic, minimizes risk and includes trade-offs that best address the prospect’s needs and issues.
In both cases, keep your prospect in mind when presenting your price.
Next week: How to help evaluators visualize and understand your price.
Want to add a cost-price summary to your next bid?
Although our posts focus mainly on differentiating and presenting your proposal’s technical offer, we’d never suggest price is unimportant.
Even in the case of two-envelope RFPs, where prices are revealed only after the narratives are scored, price looms large in the final decision. This is true even when the narrative sections are weighted at more than 50% of the total.
The chart below shows the narrative points advantage you need to prevail (expressed as a percentage of the total) if your price is anywhere up to 10% higher at various weightings.
In competitive situations, bidders are unlikely to overcome a price disadvantage of 5% or more.
If a buyer is determined to award to the lowest priced bidder—whether due to budget pressures, or to avoid protests or public scrutiny—there are at least three ways to accomplish this.
Adjust technical scores after the price envelopes are opened (This is unfair and/or illegal—but it happens.)
Score the technical narratives in a very narrow range, so the lowest price is likely to prevail, despite the relative weighting scheme
Structure the RFP rules so the lowest qualified bid wins
The good news is, most buyers are looking for value and strategic fit, not just the lowest price.
Also, nearly every bid we’ve supported has been run fairly. In fact, evaluation teams for large government bids typically include an independent monitor responsible for ensuring a fair process.
Still, as a key element of your offer, price deserves the same attention to expressing value as do the sections devoted to your understanding, solution, experience, team and implementation plan.
Presenting and positioning and your price
This month, we’ll look at ways to help evaluators understand how you reached your price, why it is reasonable—and proof you can deliver within it. This will include ideas in two areas:
Presenting: Most bidders limit price presentation to completing the issuer-supplied forms. But—especially for multi-phase projects and complex blended pricing situations—we’ll suggest other approaches.
Positioning: Every technical narrative reflects choices made when developing an offer. Many of these will differ from your competitors’ decisions and will impact price. It’s important to make your trade-offs visible and to justify them.
Added benefit: By making the effort to present and position your price, you and your team will gain new perspectives on decision making that impacts costs and pricing. This may well lead to adjustments in your process that improve your chances of winning.
Next week: Presenting your price (1 of 2)
Need to do a better job of presenting price in complex proposals?
All this strategy work is aimed at developing win themes—clear messages that express the uniqueness of our offer and our key differentiators. Now we need to ensure writers make maximum use of these themes in their sections.
Use win themes to complete the SCP
Each writer gets one or more SCPs, pre-loaded with general information and compliance items. Insist writers fully complete the remaining SCP sections (see Figure 1) before they start to write.
The work of going through the proposal plan and individual strategy-building tools and conferring with subject matter experts will give writers the depth of understanding needed to write powerful content. If subject matter experts are section authors, the exercise will help give them a strategy perspective—lifting their thinking from simply how the solution works to why a proposal evaluator should care.
Figure 1:Developing Powerful Content: Completing the SCP forces writers to fully integrate compliance requirements, technical content and win themes before they start to write.
Capsule statements and visualizations
As you review SCPs in progress, pay special attention to the capsule statement and ideas for visualizations (including captions). Because they need to integrate information and strategy, these act like canaries in a coalmine—early indicators a writer might be struggling.
If a capsule statement is missing or lacks impact and/or if a graphic and its caption don’t highlight a key benefit or differentiator, go back through the SCP to see how well the writer has completed the other sections.
Sections will write themselves
OK, that’s an exaggeration. But the investment in completing, reviewing and approving section content planners is guaranteed to produce stronger proposal content with fewer surprises—and keep you on your completion schedule.
Need help with process that builds strong proposals?
Information—specific facts the RFP asks you to provide, for example details of your proposed solution and implementation plan, proposed organization, past experience (often in the form of project sheets), and key individual resumes
Strategic messaging—showing you really understand the project and the prospect’s needs and hot buttons, expressing your points of differentiation, and positioning your company against your competition
Visualization—graphic representations of important aspects of your offer, usually those identified in the messaging item immediately above
Using a Section Content Planner
In this post, we’ll focus on the information part of content. Information items are identified in the RFP, then captured in the compliance matrix and copied to the Section Content Planner (SCP) using the process shown below.
Figure 1:Information tracking: Required information (i) is identified in the RFP, captured in a Compliance Matrix, then organized in the Annotated Table of Contents (ATOC), before being used to populate Section Content Planners used to guide and monitor writers.
The SCP is a key part of the package Complex2Clear uses to provide guidance to writers and to monitor proposal completion. It’s a Word document started by the proposal manager and completed by the writer with input from subject matter experts (SMEs).
SCP sections and responsibilities are shown in the table below:
Proposal ID, Section no., topic, page limit, RFP references for statement of work, scoring, deliverables, etc.
Compliance items with RFP reference for each
Bullet point outline of key points to be covered
List of known buyer issues
Strategy to address buyer issues, competitive threats and other risks
Features and benefits
Key features and benefits of our offer
Our differentiators and expressing our advantages over competitors’ offers
One sentence answer to: Why should this section get maximum points?
Sketch or description of 1-2 graphic(s) that captures our key differentiator(s)
Benefits-oriented, buyer-focused caption for each graphic
* Strategic messaging elements will be covered in next week’s post
Daily progress management
The SCP lets the proposal manager see how well each writer understands a section’s required information and his/her ability marry that information with your strategy to produce compelling arguments for your offer.
Insist on checking your writers’ progress daily. Begin by monitoring SCP completion and then use the SCP contents to ensure those ideas are well expressed in the section. On large proposals, focus on one or two elements (e.g. visuals and captions) across all sections, rather than trying to carefully review all parts of every section every day.
Dealing with pushback
Doesn’t all this form filling waste time? No! Far more time is lost when writers go off in different directions and write without a plan. The two or three hours it takes to plan a section thoroughly is more than recovered in writing that’s complete, compliant and on-message—especially where content developers are subject matter experts unused to writing.
Some writers may bridle at being held accountable for daily progress. We recommend you insist on the same rules for all. This is especially true for virtual teams where precious days can be lost if a writer goes off message (or AWOL) undetected because no check-ins are scheduled.
BOTTOM LINE: This is the way every large bid team operates. It’s the best way we’ve found to produce a winning proposal on a schedule without last minute all-night and weekend sessions.
Specifies a structure, follow it exactly, using the same numbering system as in the RFP
Implies a structure—for example by posing a set of questions—follow that structure, using the question numbers to number your sections
Includes a scoring breakdown, use that breakdown to structure your proposal
We’ve seen all of the above, plus examples of no guidance and RFPs containing separate overlapping versions of the required information. If unclear, consider using the process specified in the RFP to ask the issuer for guidance. Many bidders are reluctant to ask questions, but issuers tell us it shows engagement and interest in winning their business.
In the absence of any guidance, organize your proposal as follows:
Benefits of proposed solution and advantages over alternatives
Experience and qualifications
Implementation plan and schedule (if applicable)
Where the RFP is vague or contains conflicting content information, make it easy for evaluators by including a compliance table cross-referencing RFP paragraph numbers to locations of the corresponding responses in the proposal.
Using an ATOC
Document your proposal structure using an Excel worksheet formatted into an annotated table of contents (ATOC). Assign columns for:
RFP page and paragraph nos.
Points allocated by section or subsection (if in the RFP)
Pages allocated (8.5 x 11)
No. of foldouts (11 x 17)
Section lead (person responsible for writers and SMEs)
Subject matter expert(s) (SMEs)
Graphics support person
Content delivery date(s)
On a separate worksheet, list all team members’ contact information (including mobile numbers).
Populating the ATOC
Use the information captured in the compliance matrix (see last week’s post) to populate the ATOC. Reserve the first couple rows of the ATOC for general information about the proposal, including maximum pages allowed, any formatting restrictions and packaging and delivery requirements.
Use the remaining rows for proposal content requirements.
We assign separate rows to covers, tabs, sections and subsections and appendices. This lets us assign and manage responsibility for all design elements (covers, tabs, etc.) and for individual required forms (insurance certificates, bid bonds, etc.) as well as content. It also makes it easy to compile a detailed contents list as part of our printing instructions.
Make it yours
The ATOC is a powerful proposal management tool. Make it yours by adding columns for additional items you need to track and make decisions about how to populate it. Customize your ATOC so it works best for your business and team.
Need help getting your proposal process organized?
In last week’s post we talked about “owning the RFP”—by which we mean mastering and managing all the details needed to win.
This week we’ll look at compliance, the first sub-component of mastery. Assigning clear responsibilities for identifying and tracking all compliance items ensures proposals are judged on their merits—not crippled by failure to meet one or more requirements.
What is compliance?
Compliance items are the issuer’s specific asks—things the RFP states the bidder “shall,” “will,” or “must” do. “Should” may also indicate a compliance item. For example, if the RFP asks that an individual section should contain no more than 15 pages, we recommend you treat that number as a hard limit.
Deciding what to track
Even with the above definition as a guide, different individuals can interpret compliance differently. We’ve seen over-zealous team members identify hundreds of compliance items in a 300-page RFP. The result is a list that no one has the time or appetite to manage.
Our rule is to select items that pertain to the proposal only (not to later stages in the procurement and contracting processes) and that apply to:
Delivery requirements: Where, when and how your proposal must be packaged, labelled and delivered.
Design: Requirements and restrictions around paper size (including for foldouts), margins, type font and size, colour and duplexing, binding, etc.
Contents and structure: Information the RFP requires as part of your response and the proposal’s high-level organization. This includes narratives, project sheets, resumes, forms, and schedules, including page limits for each
Capturing compliance items
In the old days, teams cut up a hard copy of the RFP and used the clippings to assemble a compliance checklist. Today, high-end software can strip compliance items out of an RFP and assemble the list automatically.
We use the following approach:
Use the annotate feature in a PDF reader to highlight compliance items throughout the RFP. As insurance, ask a second team member to review the annotated PDF for any missed items, since this may be the only comprehensive compliance check made.
Create a compliance matrix using an Excel worksheet as follows:
Copy each requirement, its RFP page reference, section and subsection, into adjacent columns of the worksheet
Use one or more columns to categorize items under Delivery*, Design, and Content and Structure
Sort the sheet by category and use a column to assign responsibilities for each item
We've found this process is uncomplicated, requires no single-purpose software, makes it easy to add comments where needed, and works for all RFP types.
* NOTE: Delivery requirements are invariably found on one page of the RFP. Make copies of this page, and any required labels, for the proposal manager and the person responsible for delivery.
Working with compliance items
Figure 1 shows how we organize and track compliance items through the proposal development process.
Figure 1:Working with compliance items: After identifying compliance items in the RFP, divide them into delivery (1), design (2), content (3) and structure (4) and use these requirements to populate proposal management documents. ATOC is an acronym for Annotated Table of Contents—the subject of next week's post.
Managing the design and delivery requirements is important but relatively straightforward, since one person is typically responsible for each. The content and structure items, however, need more work before they’re ready for use.
Include a compliance check list in your proposal
Some RFPs include a compliance checklist for completion and inclusion. If proposal rules allow, consider including a table listing content requirements with a column headed COMPLY with the word “Yes” or a checkmark alongside each item. This will affirm to evaluators that you have met all requirements.
Next week: We’ll describe the ATOC and how to use it.
To develop a competitive proposal, you first need to master the RFP (or RFQ). This seems self-evident—but we repeatedly run into situations where clients still haven’t fully grasped one or more requirements, just weeks before the due date.
One of our team talks about “owning the RFP.” He means getting your head around—and then managing—three kinds of requirements: compliance, structure and strategy.
Most teams responding to very large opportunities have structured their processes to do this. But others—often pursuing contracts in the tens of millions of dollars— jeopardize their chances by letting important pieces fall through the cracks.
We’ll briefly describe these items in this post, and then dive deeper into each one in the coming weeks.
Every RFP contains compliance items. These are things bidders must do—or risk being thrown out of the competition. The most obvious example is the submission deadline, deliverables and packaging—but RFPs typically include font size and formatting requirements, page limits, and various forms and certifications for completion and/or submission.
Someone on the team needs to identify all compliance items and follow up to ensure they are met. We’ll recommend a process for doing this next week.
Creating a proposal structure
RFPs vary widely in how closely they specify the contents of your response. Some are vague—one recent example repeated the statement of work twice in slightly different formats, making it frustratingly difficult to decide which order to follow. Other bid issuers provide a specific set of questions and sub-questions, essentially building the table of contents for your response.
We’ll post on documenting the structure of your proposal in two weeks.
Once they've mastered the requirements and assigned content to writers, some team leaders make the mistake of managing too loosely. Loose management runs the risk of writers heading off in the wrong direction or—as more often happens—waiting until just before the deadline to begin, resulting in poor or incomplete content.
We'll post on how to manage content in three weeks.
Managing win themes
Every successful proposal—even those on short deadlines—starts with strategy. This rule has two parts: 1. Developing a winning strategy and; 2. Ensuring every proposal section supports that strategy. Many bidders spend time upfront on strategy, but fail to see it carry through into the proposal.
We’ll post on ensuring strategy gets deployed throughout your proposal in four weeks.
How strong is your ownership?
Based on our research, most bidders (about three quarters) do a good job of identifying and managing compliance requirements—but less than half consistently master structure and strategy. Where does your team rank?
If you’re not familiar with AFP/P3 projects, please read the posts linked above.
The importance of a single voice response
As explained last week, project sponsors (RFQ issuers) select for consortiums that not only have experience and capability, but are likely to remain intact and aligned throughout the RFP phase and the contract term.
Beyond assurances of unity, backed by a track record and contractual mechanisms, the proposal itself reflects whether consortium members are on the same page.
Strong RFQ responses look and read as if developed by a single entity (which is what the consortium needs to be). In contrast, inconsistent messaging and a mix of structural, writing and graphic styles weaken any claim to a single guiding will and mind.
Components of a unified response
Assess your RFQ responses for the following attributes of consistency:
Consistent structure: Structure is the underlying framework behind a proposal section. Although some RFQ issuers provide detailed evaluation criteria that imply a structure, some sections (design approach, operating plan, etc.) may offer considerable flexibility in how to respond. If each major RFQ section (e.g. teaming, design, construction, operations, finance) includes a section on approach, for example, we recommend writing within a common framework. Following a framework can help authors from different companies create content that reflects alignment.
Unified messaging: All sections should reinforce the consortium’s strategy, expressing win themes with consistent language and arguments. While every consortium agrees on a set of win themes at kickoff, follow-up is needed to ensure they are reflected throughout the response.
Consistent style: Below the level of structure is writing style. Since RFQs are persuasive documents, the language and syntax are often less technical than for RFQs. This encourages team members’ corporate personalities to creep into the writing, affecting sentence and paragraph structure, often making some sections more informal or “salesy” than others. A third party, such as Complex2Clear, can edit these different styles into a single voice response.
Uniform quality: RFQs typically include a glossary of “official” terms and titles specific to the project. The consortium needs to go further, creating a proposal style guide of industry-specific acronyms, short forms for team members, the sponsor, reference projects, roles, committees, etc., how to handle the abbreviation in first-instance references, and any other items repeated throughout the response.
Unified look and feel: The consortium logo, template and graphics (org charts, charts and tables, illustrations, callouts) need to align to a set of graphic standards across the entire proposal. Aligning to these standards is another logical role for third party support.
Achieving single voice is hard
The effort to complete a compliant and responsive proposal can easily crowd out the items above. Successful consortiums recognize this, start early, and engage the resources they need.
If you’re not familiar with AFP/P3 processes, please read the posts linked above.
The critical importance of alignment
Beyond technical competence, a consortium needs to create confidence that it will persist through the RFP stage and will function cohesively if it wins the contract.
This is critical to the issuer. A consortium that gets shortlisted and then falls apart due to disagreements, internal issues in one or more partners, financing difficulties, or for any other reason, reduces the competitiveness of the process. If two of three shortlisted proponents drop out, the issuer must abandon a multiyear procurement—a great waste of time and money.
Poor alignment during the execution phase can cause quality, budget and schedule issues—again wasting time and money.
It’s not enough to express confidence that things will go smoothly, based on mutual respect and good intentions. With high stakes and tight schedules ahead, issuers want solid evidence.
Evidence of ability to achieve and maintain alignment
As evidence your team will stay intact and aligned, issuers will look for:
Experience as SPV chair: Does the head of the consortium and the designated appointee as SPV chair have a track record of steering similar teams through multiyear projects?
Size and strength of SPV members: Are the individual ProjectCo members large, strong companies that can provide equity and guarantees sufficient to attract the needed debt financing? Do they have the resources (people and other) to overcome unexpected setbacks?
Corporate relationships: Are any team members related entities? Many P3 consortiums include, for example, a financing entity and one or more construction companies with common ownership. These relationships tend to produce natural alignment.
Previous collaboration: Have the same companies collaborated successfully on similar projects in the past?
Governance structure: Are the governance structure and processes submitted in the response robust and complete? Has the SPV used the same approach successfully in similar past projects?
Teaming agreements: Are agreements in place to clearly identify each member’s responsibilities and decision making authority? Does the response include well-defined dispute resolution mechanisms?
Risk management ability: Does the RFQ response anticipate all major risks and explain how they will be managed? Are comprehensive back-to-back contracts in place to allocate risk and minimize stranded risks?
A single voice response is also evidence
Consortium proposals are, by definition, drafted by people in several companies. How do you manage the process to present a single voice response? That’s the subject of next week’s post.