Request for Proposal Tips

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request for proposal tips

Credit: Guillaume Brialon

The Request for Proposal (RFP) process is a purchasing process used to elicit service provider proposals for a specific product, service or solution.  In Information Technology, this often translates into the purchasing of IT services, software or the combination of both.   If you have ever been through an RFP purchasing cycle, then you know managing the RFP process can be a project in itself.  In enterprise IT organizations, an RFP can be worth millions of dollars to a supplier and represent a strategic effort for both business and IT organizations.

Organizations want to know they are getting the best solution for their dollar and suppliers want to compete fairly for the business.  Price isnt’ always the deciding factor in an RFP and the following five request for proposal tips can be applied to improve the overall proposal process and ultimately the decision.

Request for Proposal Tip #1:  Define the evaluation criteria upfront

A lot of effort is placed in defining the goals, scope and project details in a request for proposal package.  There can be a lot of pressure to issue the RFP, make a decision and get started with the project in an effort do deliver business value quickly.  However, project managers should take the time to define the evaluation criteria so both the selection team and suppliers understand all the areas that will be evaluated.

It is also important to share the evaluation criteria with the suppliers so the suppliers understand how the response will be evaluated.  The project manager doesn’t need to share the criteria weighting, but it is helpful to let a supplier know the critieria.  If project managers don’t include the criteria, a supplier may provide an inaccurate response and overstate one aspect of the proposal while understating another area.  When suppliers receive feedback on the RFP decision, they may feel like they’ve missed an opportunity to highlight the benefits of their solution had they know the criteria earlier.

Request for Proposal Tip #2:  Include a cross functional section of RFP reviewers

In a RFP process, the decision makers need to include more than just the business lead and the project manager.  It is important to include a cross functional set of reviewers from purchasing, IT, the functional business organization, finance and legal.  By engaging a cross functional team, you will get greater input into the price, contract and financial issues associated with the purchase decision.  As IT managers, we are often challenged to move quickly, however, no one wants to spend more than they need to deliver IT services and each party wants to ensure the contractual and legal obligations are understood.  By including a cross functional team, you’ll have appropriate representation to handle issues and concerns that can affect the entire organization.

Request for Proposal Tip #3:  Conduct reference calls and site visits

Reference calls are an eye-opening experience.  As you narrow down the prospective suppliers, remember to ask for customer reference calls.  It is important to get candid and honest feedback from other organizations that have used the potential supplier’s products or services.  The prospective supplier will be more than happy to provide client references and any other information needed to make an informed decision. The supplier should not attend the call so you can have an objective, open and honest dialogue.  I’ve found by conducting customer reference calls, additional risks and lessons learned were quickly identified and could be applied to my own project.

If required, ask for a site visit to learn how the supplier has implemented a specific product or service.  During one RFP outsourcing project, I travelled to several sites to understand how their technology was implemented as well as how the business used the solution and services.  It is another opportunity to understand how a customer is living with the solution.

Request for Proposal Tip Tip #4: Send all requests for communication to 1 person during the RFP process

With potentially millions of dollars in sales on the line, project managers and other members of the selection committee will often get calls for status, updates and any information to indicate a decision.  Purchasing organizations usually have strict guidelines on communication with suppliers during a RFP selection process.  It is best to send any and all requests for RFP questions to 1 person (usually a purchasing representative) authorized to provide status.  In IT, relationships with your software and solution providers are critical and even though its “just business”, you want to ensure each supplier is treated fairly in the process.  Information leaks can also damage the negotiation process.

Request for Proposal Tip #5: Incorporate promises made in the sales presentation into the contract

Suppliers will usually present their solution to the RFP selection committee.  During these presentations, additional discussions and commitments may be made.  If additional commitments or promises are offered during the presentation, make sure these commitments are translated into the written contract.  Even if a commitment was made in a sales presentation, if it isn’t incorporated into the contract, it was never really a commitment.

Working on projects that leverage suppliers and external solutions are exciting projects.  The RFP process provides the project manager with a new challenge that isn’t always found in internal systems development.  If you get the opportunity to participate in an RFP, remember to treat it like its own “mini-project” as the issues, risks and timeline all needs to be managed.

About Andrew Makar

Professional Cat Herder and an Agile Enthusiast with a keen interest in putting PM theory into actual practice.
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