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Free bid/no-bid decision tool

 April 30, 2019
by Paul Heron

This is the last post in this month’s series on evaluating RFP opportunities. The idea is to use a shareable framework with consistent criteria to help business leaders reach consensus on bid/no-bid decisions.

Consistency will also enable you to adjust your criteria and/or scoring, based on experience and to optimize your win rate over time.

Here are links to the earlier posts on this topic:

Download the tool

Download the Bid/No-bid Decision Tool in Excel format here. The tool is free for your internal use. You may adapt it in any way that suits your business.

How to use the tool

1. Customize the questions

Discuss the questions with your team. Change, add or eliminate questions until your team agrees on a set that will work for the prospects and RFPs you typically see.

When changing or adding questions, be sure to create statements that constitute “go” votes when answered “agree” (+1, +3 or +5). That way, a higher result for each answer always means a stronger endorsement for bidding.

2. Reach consensus on new opportunities

When a bid opportunity arises, complete the sheet together or individually. Always discuss questions that elicit widely varying scores. After using the framework a few times, you may decide to clarify questions that cause confusion.

Agree on the minimum score that makes an opportunity attractive. Decide how to treat potential deal blockers.

Record the scores for each opportunity for future reference.

3. Include scores from the tool as part of win-loss analysis.

Once you’ve had experience using the tool, use it when analysing your win rate and profit history on projects you’ve won. Suggested questions for that analysis:

  • How well do scores correlate with success at winning bids?
  • How well do scores correlate with profits on won projects?
  • Is there an argument for raising or lowering the threshold score for bidding?

Document your decisions

Following a process accelerates the bid/no-bid decision, freeing up precious time either to prepare the proposal to move onto other priorities. Documenting your decisions will help your team analyse results, and to fine-tune the criteria and how you apply them—resulting in more efficient bidding.

 

Need help developing better bid processes?

Contact Complex2Clear

 

 

Photo credit


Paul Heron, MBA, is the founder and managing partner of Complex2Clear, and leads our bid response practice. LinkedIn 

 

 

  

Bid/No-bid: Internal factors

 April 23, 2019
by Paul Heron

This month we consider how to decide whether or not to bid on a specific RFP. A poor process wastes time and creates division. A shared, transparent process improves internal alignment and gives you information to optimize your win rate over time.

Find earlier posts in the series at these links:

Step Three: Assessing internal factors

In addition to assessing the prospect, project and competitive factors, do you have the team and resources needed to win the competition and take on the project? Answer these questions by asking:

  1. How qualified is your proposed team? How does your team rank on a scale from highly capable to barely qualified? Do you have a leader with experience on similar projects? Could another team member complete the project if the proposed leader became unavailable?
  2. Are other needed resources available? If you win, how far will the project stretch your infrastructure? Do you have the necessary IT and admin resources? Can you find and on-board additional resources post-award?
  3. How will this project impact other clients? Might an existing client see a conflict of interest if you take this on? Will the effort needed to complete this project compromise your ability to serve other clients?
  4. Does the project have strategic significance? Does the project have potential to improve your competitive position? Is it your chance to crack a new account or get a toehold in a new industry? Could it fund development of a new technology or new capabilities?
  5. Is it too big to handle? Growing companies need to constantly balance their appetite for ever larger and more complex projects with the need to be prudent about risk. Many industries include onetime high-flyers brought down by “whales”—projects they took on, and then couldn’t handle.

Is this the right project at the right time?

Most RFPs may fit well with your capabilities and resources, making these questions easy to answer. But stretch opportunities, when they appear, need to be recognized and considered for their strategic implications.

Using a decision framework will help you establish a shared language and format for talking about RFP opportunities—and to surface strategic issues in a way that enables you to take the risks needed to grow, while protecting your business.

 

Next week: A decision-making format you can adapt and use in your business.

 

Need help making better bid/no-bid decisions?

Contact Complex2Clear

 

Photo credit


Paul Heron, MBA, is the founder and managing partner of Complex2Clear, and leads our bid response practice. LinkedIn 

 

 

  

Bid/No-bid: Competition

 April 16, 2019
by Paul Heron

This month’s posts provide guidance for deciding whether or not to bid on any given opportunity. Following a process improves internal alignment and provides information to optimize your win rate.

Find the previous posts at these links:

Evaluating your competition

Assuming that bidding will consume scarce resources (nearly always the case), be sure to assess your competition before making a decision.

Use these questions to start your thinking:

  1. Are you up against an incumbent? If this is a renewal, is the incumbent bidding? If yes, is the client genuinely looking to change suppliers, or simply fulfilling a requirement to issue an RFP? How well has the incumbent performed on the current contract? In this post, we talk about why incumbents often lose renewal competitions.
  2. Are you competitive? Do you know what other bidders are bringing to the table? In many sectors (telecom is a good example) disruptive or next-generation technologies can offer huge cost savings in the right situations. Is this one of those situations, and can you be competitive?
  3. Does a decision maker or influencer favour a competitor? Favouritism could be based on a past association or a current business relationship unrelated to the current RFP. If another bidder is favoured, how well does the RFP process promote fairness?
  4. Are there any low-ball competitors? Every industry has one or more players who consistently underbid everyone else. These companies may be desperate for a win, or they may not fully understand the RFP or their own costs. The prospect of a very low competitive quote may affect your appetite and/or the way you present your bid. For example, you could provide a highly transparent pricing model to raise doubts about the low quote.

Use competitive factors to fine-tune your decision

Competitive factors are seldom showstoppers, but they can help you prioritize RFP opportunities. Faced with going head-to head against a popular incumbent or a competitor with a cheaper and more efficient technical solution, investing effort in another bid will likely yield higher returns.


Next week: Internal factors in the bid/no-bid decision process

 

Need help developing a better bid/no bid process?

Contact Complex2Clear

 

Photo credit


Paul Heron, MBA, is the founder and managing partner of Complex2Clear, and leads our bid response practice. LinkedIn 

 

 

  

Bid/No-bid: Familiarity factors

 April 9, 2019
by Paul Heron

Last month’s post highlighted the importance of making fast and accurate bid/no-bid decisions. This post describes the first step—assessing your relationship with the prospect and knowledge of the requirements.

How familiar is the prospect?

Most RFP issuers prefer to work with companies they know and trust. So, in most cases, the odds of winning an RFP you discover on a portal are slim. To assess your relationship, start with these questions:

  • How well do you know the prospect? Do you understand the issuer’s strategic needs, pain points and business drivers? Can you build a proposal that offers value beyond meeting the base requirements?
  • How well does the prospect know your team and capabilities? Have you worked together in the past? If yes, was that a positive or negative experience? Are there decision makers or influencers who will advocate for you? On the flip side, do you have detractors in the prospect organization?
  • How good is your fit? Do you share similar values? Does the prospect run a fair and transparent evaluation process? Do they appreciate value—or is price the overriding factor? Do they have a reputation for suing or for not paying contractors?

In some situations, a prior relationship is less important. For example:

  • A robust industry presence will attract unsolicited RFPs. In fact, the prospect may have researched your company and know more about you than you do about them.
  • If your capabilities are unique or highly regarded, a prospect may be happy to provide additional information to make you comfortable bidding. This is especially true with private sector prospects.

What do you know about the project?

  • Are the requirements familiar? Have you completed similar projects for the same or similar clients? Have you discussed the project with the prospect? Or (ideally) did you have a hand in shaping the RFP?
  • Are you confident in your capability? Assuming you understand the challenges well, are you confident you can meet them? Beyond being capable, can you add significant value?
  • What about profitability? Are you confident the project will exceed your minimum profit threshold—or, is this likely to be a marginally profitable project?

To increase your project knowledge, explore these two options:

  • Does the process allow you to learn more? As noted above, private sector issuers tend to be more flexible than governments in proving additional information.
  • Can you deal with unknowns through contracting? Do the RFP rules allow you to structure your offer to manage risks? If the RFP doesn't include a pro forma contract, will the prospect share its standard terms and conditions?

The value of pre-RFP discovery

The assessment questions above are often hard to address once an RFP is issued—which shows how important it is to identify and work upstream of large opportunities. Please see our post on managing pre-RFP discovery.

Next week: Bid/no-bid competitive factors

 

Need help building stronger bid processes?

Contact Complex2Clear

Photo credit


Paul Heron, MBA, is the founder and managing partner of Complex2Clear, and leads our bid response practice. LinkedIn 

 

 

  

Making bid/no-bid decisions

 April 2, 2019
by Paul Heron

Many companies have unresolved tension between those who want to respond to more bid opportunities and those who want to focus on fewer bids and aim for a higher win percentage.

Bid more, even if success rate drops?

Sales teams responsible for filtering opportunities and preparing bids typically want to bid only on RFPs where they see a high probability of success. For them, building client relationships seems a better use of time than writing long shot bid proposals.

Higher-ups may see a high win rate as indicating the company should be bidding on more opportunities—even at the cost of losing more often.

While it makes sense only to bid on winnable projects, setting the bid/no-bid boundary can be tricky.

Challenges in finding middle ground

As with many disagreements, the ideal solution lies somewhere in the middle. Sales teams may be best positioned to gauge the chances of winning a given opportunity—but there’s usually a lot of territory between sure winners and no hopers.

Many variables—including whether the team is making budget, the number of new prospects competing for attention, and the availability of resource—can influence the team’s thinking on any given bid.

Corporate leaders, on the other hand, are focused on company-wide growth and profitability, and they may be less sensitive to the added pressure that preparing more bid responses puts on their sales teams.

Partial solution: Bid more efficiently

One approach to this issue is to reduce the effort needed to bid without compromising quality. Assuming bid teams have an incentive to win more business, an easier process should result in a higher RFP response rate.

Companies pursue bid efficiency with investments in processes, structure, technology and knowledge management. In future posts we’ll look at ways you can invest to work less and win more bids.

Despite these improvements, the tension around whether to bid will remain, unless you take another step.

Formalize your bid / no-bid decision

Equally important as efficient proposal writing is a process for efficiently deciding whether to bid.

Making the bid/no-bid criteria and decision transparent and shareable not only helps resolve tension around this issue—it also provides a baseline for evaluating success against your predictive score, so you can review your success and adjust going forward.

Coming posts will cover bid/no-bid criteria and a decision making format.

 

Need help with your bid/no-bid process?

Contact Complex2Clear

 

Photo credit


Paul Heron, MBA, is the founder and managing partner of Complex2Clear, and leads our bid response practice. LinkedIn 

 

 

  

 

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