RFP process, the secret is in the sauce!
A request for proposal, or RFP, is a document that solicits proposal, describes a project’s needs and asks for solutions from qualified vendors. A good RFP can introduce an organization to high-quality vendor-partners and consultants from outside their established networks and ensure that a project is completed as planned.
It’s common for our consultants, when engaging with a new Customer discussing their software needs, to receive as solely wish the following requirement “Please just tell me who is using this and that solution and we will then decide”. We agree that in the above sentence there is a lot of truth and value, but still the fact that a similar and reputable company is using a product successfully won’t guarantee that your organization will obtain the same results.
Independently of the industry, businesses work towards similar objectives but the way they reach to them may be completely different, this could bring to different levels in quality and experiences for their Customers. Some wise man once said: “The secret is in the sauce!” and we couldn’t agree more! If you have doubts please keep on reading this article.
What’s the Purpose of the RFP Process, and When Do You Need One?
Many sees the RFP as an exaggeration, something only suitable to governments and public projects, but this process is commonly used also by private companies, in fact, any one of the three reasons below would be sufficient to justify issuing an RFP, but taken together they’re a powerful tool.
- Finding the vendor best suited to the needs of your organization. Casting a wide net and letting the unknown companies compete against the familiar ones will increase the likelihood of finding just the right vendor for your current needs.
- Accountability and good governance. Due to its open nature, the standard RFP process encourages fairness and transparency while minimizing the likelihood of corruption or favoritism.
- Needs assessment. The process of writing an RFP gives you an opportunity to interview key stakeholders and bridge the gap between the vague aspirations that launch a project and the concrete, measurable requirements that guide it to successful conclusion.
Once, couple of years ago, I came across a very curious episode, the CEO of a well established but small shipping company who purchased and implemented an ERP system only one year prior, requested a meeting because was looking for help as he was receiving constant feedback from his staff that the software was not performing as expected. During the investigation the above CEO told me: “We have purchased this system because another shipping company in the area, well known and respected by the industry is using it! the problem is that we didn’t know that on the market there were different solution with a similar name, i think we may have purchased the wrong one!”
We quickly established that indeed they have purchased a different product, but was more challenging to explain the reasons why even the “good” software wouldn’t have worked for them. In fact, the company they were taking as example had hundreds of employee in the office, an IT department comprised of different sub-teams, and a fleet of more than 70 ships, while they were managing 4 vessels, about 10 office staff and a part-time IT guy maintaining their server room.
Obviously this event is tragicomic per se, but is highlighting a possible outcome of what is, unfortunately, a very common behaviour. It was a hard project but for the records today, after changing some process and reconfiguring the tool, they are happily using the “wrong” product… because “the secret is in the sauce!”
What are the 6 steps to deliver an effective RFP?
By definition, RFPs provide a lot of crucial information in order to allow a business to make an informed and strategic decision. To achieve that goal requires a substantial amount of preparation, research and skillful execution.
While it may seem complicated, the RFP process is fairly straightforward when broken down into the below essential six steps.
- Gathering RFP requirements. This is the very first step and the one where we usually see the main problems, in fact companies approach this superficially by simply listing the wishes of the managers or key stakeholders without analysing the reasons behind such need. Often producing a long list of requirements in clear contrast between themselves, complicating the job of the vendor who at this point doesn’t have a qualitative set of data to propose the right solution, as you can imagine all the rest at this point will take the RFP further apart from the wanted result. And yes, you can even ask a list of who else is using their product!
- Crafting your RFP. The format of the documentation is as important as its content, in fact this has to be created in the most clear manner, helping the vendors to understand your needs, there are several tricks or even products to help you delivery an effective documentation, obviously if this is not a regular task for you, it could be difficult to nail it the first time..
- Conducting the initial evaluation. Once information will start pouring, it is important to compare the various proposals in a fair manner, keeping always the final objectives in mind. In fact here is easy to deviate because of some fancy marketing material and then realize that the boring solution would have been a better investment.
- Following up with shortlisted vendors. Once the first selection is done, is time to shift gear and start looking at some demonstration, more questions will come up while looking at the software in action, don’t be afraid to ask, and be openminded, maybe your idea it wasn’t that great at the end, and these vendors can provide you with a better solution than you thought.
- Making your final selection. Once all the data has been gathered, is time to select. Once again, clear objectives in your head, review the technical requirements, the non-functional requirements and any variable that could impact directly or indirectly the solution. Go back to your processes and understand if it is a good fit, will you end up using it in a manner it was not designed for just to continue working in the same way you do now? well that is not an improvement isn’t it?
- Creating and completing the contract. Once decision is made, is time to close the deal and start the project. By now this should be the easiest of the steps as, if everything was done properly, all the details have already been discussed, each of the parties is already aware of the contractual requirements so is just time to put ink on paper.
This article doesn’t want just to explain why an RFP is a good thing in any scenario, but also to set the expectations for the reader, as it is a time consuming process which requires experience and a specific set of skills.
If you would like more information on how we could help with your software selection, please don’t hesitate getting in touch with us.
Founder | C-Suite advisor
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