Answering
RFPs is one of the relatively ugly costs of doing business. There are many
myths circulating about RFPs, and in particular the best way to win them. Many
of them are wrong. Completely wrong and out of date! Since the burden of
responding to RFPs usually falls to the SE Community (who call them Really Fast
Paperwork), it’s time to look at some of these myths in more detail, and debunk
them once and for all. The Big Three RFP lies are:
a) 9/10 RFPs are biased towards one vendor;
b) If you don’t write it you won’t win it
c) You have to answer (and win) every request.
Believing
these three alleged facts will cost you money, an ever-expanding amount of time
and resources, and decrease the morale of any SE team whose job it is to
respond to an RFP. You may not agree with my point of view, but it will make
you take a fresh look at how you answer.
- 9/10 RFPs are biased. Usually the losing sides make a statement like “it was clearly rigged for our competitor”. Here is my analogy: I train a youth football (soccer) team. We are one of the best teams, we play in a very competitive league and we win most of the matches we play. Sometimes we do lose. When we lose, the parents blame the referee for making a bad decision or favouring the other team. Yet sometimes we make mistakes and play badly (the children are 11 – it happens!), sometimes we lose to an inferior team that just does everything right and beats us, and sometimes we are simply beaten by a better team. In the eyes of the parents – it is always someone else’s fault – never their own children.
That
is exactly the same view that sales and presales teams take when they lose an
RFP. Over the past year I have spoken with more than fifty IT and business
executives about the RFP process. Their responses match my own experience as a
former CIO – “John, we never ever bias an
RFP. We can’t afford the consequences if we are caught. There are so many other
more subtle ways of influencing a decision if that’s what we wanted to do.”
A slightly more accurate version of the myth
is that “9/10 customers are already
biased towards a particular solution”. RFPs are rarely biased, people are.
I do not believe the number is as high as 90%, I think it is more like 50%
based on my data so far. Where that impacts the RFP is actually in the scoring
process. Read on:
“This is what we do if we absolutely have to change a score. Every factor has to be
scored on a scale of 1 (low) to 5 (high) and then weighted. Making the
determination of a 1,a 2 or a 5 is fairly clean cut. The difference between a
strong 3 and a weak 4 is unclear and a matter of opinion. Upgrading a few 3’s
to 4’s for your favorite can make all the difference in the selection process
for getting to a short list. No one will ever know!”
- If You Don’t Write It, You Won’t Win It. Seriously? How many RFPs have you written for your customers in the past year? It just doesn’t happen anymore. You can certainly nudge and push an RFP by suggesting during discovery meetings that some feature/function should be made a requirement, and although I still suggest that every SE team has a standard list of questions to supply to a friendly coach in a pre-RFP stage those questions are rarely used.
Think
about the creation of an RFP and the history of the RFP process. The basic
internal purpose of an RFP is to gather some momentum and collaboration inside
the customer to get a project started. It is as much political and
psychological intent as it is purchasing intent. It is often the first chance
that business analysts have to document requirements they have gathered from
the business and the technical users. Once the document is created it is then a
common set of requirements that everyone can judge vendors by – to apply a
sense of fairness. It is the way to get legal, finance, purchasing and everyone
else on the same page.
Now go back 20-30 years. When an IT department
wanted to purchase some technology to solve some user’s business problem and
needed to issue an RFP – what happened? It was a long drawn-out process.
Analysts were tasked with investigating the market and determining who even had
something close to the requirements. They had to rely on vendor literature,
analyst reports from Gartner, Aberdeen, Giga and the like, plus personal
experience. When the RFP was issued, the customer did not know that much about
the technology and the solutions. Contrast that with today’s version. The
customer is far more educated, thanks to Google and vendor’s websites. They
scour user group boards, Facebook and Twitter to research the popularity of a
solution before the (electronic) RFP even hits your salesperson’s inbox.
The only way you can “write” an RFP in 2015 is
to virtually write it through the internet, social media and good-old fashioned
personal contact. You are still persuading, influencing, placing and educating
(think PIPE!) the customer – but in a far more indirect and subtle way. When
you discover text in an RFP apparently ripped directly from your competitor’s
website – it’s usually because of a lazy analyst, not brilliant competition.
Personal
example – I actively encourage people to write positive reviews of my book. I
do this to make sure that when someone searches “sales engineering books” MTS
comes up #1 in the list because of great Amazon rankings – and also to counter
the negative review a competitor placed online.
- You Have To Answer Every RFP. Says who? Usually Sales! I routinely ask presales leaders what percentage of RFPs they know they will never win – but answer anyway. The answer is a staggering 25-33%, which is an amazing waste of resource. In Winning The RFP Game I lay out a number of steps a SE team can take to increase both their win rate and their internal efficiency.
In business, one of the fastest ways to go out
of business is to say “yes” to everyone. As an individual, you learn to control
your time and prioritize your efforts towards those activities that have the
greatest payback (subject to managerial preference). When you personally say
“yes” to everyone you rapidly run out of time, perform poorly and are heavily
stressed. A sales and presales team – working together – cannot afford to say
“yes” to every RFP.
Now let’s talk about winning. This is a
strange statement to make in a sales situation – but you don’t always have to win the
RFP. It depends on the type of RFP. When the RFP is issued to determine who
will source a project – go for a win. Yet more than 50% of RFPs are issued as a
gating process – which means they are used to reduce a large field of vendors
(often 8-12) down to a short list of 2 or 3 who will go to the next stage of
demo/present/propose. If all you need to do is to clear the gate that’s a
different process. Know the difference.
In Summary
Just because you lose an RFP
doesn’t mean it was biased. Sometimes you just lose – far more often than you
think. That is because the 1990’s viewpoint of “you gotta write the RFP to win it” no longer exists except in the
minds of salespeople and sales trainers. It is now a far more subtle form of
influence. So when you do receive an RFP, make sure it is really worth
answering and perform due diligence and discovery on the document before you
open up the laptop to respond. Fewer, yet more targeted RFP responses will lead
to more revenue, not less.
