How to know when NOT TO bid for an RFP

This comes as the response to a comment to a previous article: it makes sense to expand on the point.

The former Chief Commercial Officer at my previous organization, Rob, championed and created the template for a “Pond Map” which every practice / vertical leader had to create for his/her practice. The concept was about ‘which pond do you want to fish in?‘ i.e. who is your client? Parameters were created to define and drill deep into the identity of the client for each practice. And every new RFP and every new proposal was expected to go through this pre-defined pond map (note: pre-defined by the practice), and were rejected if the client requirement and the pond did not fit.

A Few observations:

  1. Everyone likes to throw a bowl of spaghetti on the wall, hoping that some will stick. Maybe some will… but the resources used up for this exercise is immense and eventually worthless, especially for an organization which does not have infinite resources.
  2. It trained me and many other strategy team members to ask a basic question to every practice leader, even at the business-case stage – ‘who is/are the client that you would DEFINITELY NOT go for”. Unsurprisingly, the most common response from almost every practice leader was – ‘you know, I don’t think anybody is out of our pond”.
    Well, if everybody is in your pond, you don’t even know what is your pond. And that would get us back to spaghetti throwing.
  3. One common refrain from Sales and Practices was that – There is sureshot money here, would you not go for this deal? While it was not openly said, I think answer is ‘Yes’. every deal is a sureshot win until the prospective client chooses someone else. The process has to be more important than a hunch.

This lets the organization rationally judge and say YES or NO to go for a project. That is: you have yourself defined your pond. This deal falls out of the pond. So this project is out, we are not bidding for it. Even if the tool is not used, the concept is certainly something that every organization should embrace.

Helps in way too many things too. Consider this: if you have defined the opnd you want to fish in, how easy does the initial market identification and market sizing become?

This was one smart, smart tool. The tool is copyrighted by Rob (link), thus I don’t think I can speak about the specifics (parameters and all) here. So decided to just share with you, reader of this blog, the concept.

*Previously on Business proposal management and RFP response: Expectation Setting. Introduction.

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5 thoughts on “How to know when NOT TO bid for an RFP

  1. Pingback: Business proposal management and RFP response- Part 3 | Virtual Ruby

  2. Shom, I like it a lot – very simple and quick to the point approach which was not overwritten and belabored! We all hope to have the opportunity to work with Rob again in the future too – he brought some excellent sales tools to all of us!

  3. When you say Practice do you mean Delivery? In fact most organizations would have an opportunity review board, or a engagement qualification review or something to that effect. Such gates are supposed to ensure that sales targets do not override the risks of entering into the engagement, but they mostly end up being opportunity sizing exercises.
    I am not a fan of RFP process in services, as the benefits mostly outweigh the costs. If we assume that the probability of a win after a RFP-response is sent is 1 in 10, the bids are already marked up to cover the pre-sales cost of the remaining 9 failures. Additionally, bids always carry a high premium for risk, or the fear of unknown, because suppliers have limited clarity of the requirements in typical RFPs. So unless we are talking million dollar deals, competitive bidding is more of a drain to both the buyer and the supplier.
    The solution is in the hands of the buyer. Instead of taking the easy way out, research your potential suppliers, speak to people in the know, detail out your requirement specs and provide clarity so that you know the suppliers you wish to work with, and the suppliers know that you are “in the pond”. After that a competitive bidding would be far less taxing for both of you, and you would thank yourself for having taken the effort before hand.

    • Praveen, thanks lots for commenting, and welcome to this blog. Shom here.
      Your point is well taken. Some organizations are rather forced to go the RFP route – external stakeholders, government regulations etc being standard reasons for those. However we agree that the sourcing strategy for the organization needs to be more nuanced – floating an RFP is an easy way out, and often not the most effective.
      And that’s where sourcing advisory firms might come into play…

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