This season’s record for pathetic purchasing? The buyer who sent a complex RFx to a team I’m working with at the moment at 2.34pm on Friday, 22 December. With a tight response time in the New Year.
I used a slide at a conference presentation a couple of years back headed “Purchasers are people too”, exploring the need for bidders to consider the evaluators’ emotions when writing a proposal. Sometimes I wonder whether the title was 100% accurate!!!
Never mind…! The festive season is upon us, and we wish our readers every happiness – and every success in 2007. We’ll be back posting at the start of January, and look forward to sharing further thoughts and tips during the coming year.
With best wishes to you all.
The Proposal Guys
When I’m working with buyers, I often emphasise that suppliers have a choice as to whether to bid for an opportunity or not. Many purchasers are instinctively dismissive: “If I’ve honoured them with my RFP, they’ll surely respond?”
Now, it’s true that many salespeople do believe that there’s a pot of gold at the end of every rainbow. But the fact that good sales organisations qualify opportunities (often fairly ruthlessly) is news to many on the buying side. A recent anecdote in The Observer provided a useful anecdote on the perils for customers in this area:
“One construction industry source said that the Olympic Development Authority, which is building the infrastructure needed for the [London] Games, was in a weak position over the stadium because most major building firms did not tender for the contract”.
Purchasers need to understand that, while they hold many of the cards, under-estimating the strength of their hand can be potentially disastrous for their negotiating position. They need to sell the opportunity to potential bidders, just as those of us on the sales side need to sell our capabilities to them.
Many thanks to a friend who manages proposals for a technology company, for generously allowing me to share one of his wonderfully witty aphorisms:
“I keep trying to convince my sales colleagues that the Executive Summary should be the jewel in our proposals. The only problem is, with them it’s usually Ratner’s rather than Garrard’s”.
For American readers, I guess I ought to explain: Ratner’s was a low-end high-street jewellery chain in the UK, which was hastily rebranded after its eponymous CEO compared their product quality unfavourably to that of a Marks & Spencer prawn sandwich. Garrard, on the other hand, is the royal jeweller.
Now, this leads into a contentious debate – in that the Executive Summary is possibly the worst-executed section of many proposals: a huge missed opportunity.
The traditional view, propagated by misguided sales trainers since time immemorial, is that the Executive Summary “is the only part of the proposal that the senior decision-makers read, and so should be written for them”.
Buyers out there – remind me: that last proposal you evaluated. Did your boss arrive in the evaluation room as your review team sat down to score the proposals, rip out the Exec Summaries from each of the documents, and disappear warning that “You can do what you like in the evaluation meeting, but I’ll read these few excerpts and then tell you the answer you should have come up with all along”?
No, thought not.
Absolutely there’s a need to think about how you influence the final decision-makers – the team to whom the evaluation group report their recommendations. And some organisations with whom we’ve worked have started to do really cool stuff with glossy executive-level brochures, separate from (but intrinsically related to) the main proposal document.
But the “Executive Summary” – that opening section within the bound proposal – needs to condition and convince the evaluation team that your proposition is going to be the best. After all, if they don’t put your name forward at the top of the pile when they make their recommendations to the great and the good in the customer’s organisation, you’re highly unlikely to win the deal.
So this crucial opening section needs to establish empathy, showing that you truly understand the challenges and opportunities that they’re facing. It needs to discuss the characteristics of a great solution. And, crucially, it needs to establish the key win themes that will flow through the rest of your document. Your opening salvoes need to ensure that evaluators read the document having already decided that yours is likely to be clearly the best of the options open to them!
BJ commented recently on tactics for submitting proposals via electronic systems (sometimes known in the trade as “eRFP” or “eRFX” processes).
With my purchasing background, I was given to ponder what the buyer is trying to achieve by using one of these systems, as that might inform the debate. Perhaps sales teams have ultimately scored an own goal here – much of the drive to using the technology is caused by frustration with the quality and compliance levels of the proposals that buyers have seen in the past.
So, whist goals will vary from organisation to organisation (and from individual buyer to individual buyer), I guess it’s some or all of:
• qualify potential bidders (less serious players might not bother bidding, hence pruning the field straight away to a more manageable number of proposals to evaluate)
• ensure that all vendors provide the necessary information
• ensure that proposals are easy-to-evaluate (all answers appearing in the same order and format)
• makes it easier to compare proposals (e.g. “answer 25 from Vendor A vs. answer 25 from Vendor B”)
• bring more of a focus onto price (the “written stuff” can be compared and contrasted to make sure all vendors reach the baseline, before we look at the costs)
• making sure that timescales are adhered to rigidly
• reducing timescales (“it must be quicker for them to fill in boxes than format a huge document, surely?”)
• making it easier to circulate the relevant sections of proposals to the relevant evaluators for scoring, and (potentially) helping to collate their scores and evaluation notes in a consistent manner
• makes the process more efficient (debatable!).
There’s possibly a degree of corporate purchasing muscle-flexing here:
- we’ve bought (or been sold?!) a new system and we’re sure going to use it
- we think the system will help us get focus internally from colleagues across our business on the RFP process
- (perhaps increasingly in the future) making it easier to charge bidders for bidding (making sure that only serious suppliers bid – perhaps more than a desire to make money to offset the cost of their procurement exercise).
I guess my starting point for responding to an eRFX might be to understand why this particular customer is using a new process!
Now, all of that is fine, PROVIDED the system achieves these objectives AND doesn’t inhibit bidders from producing the best possible solutions/proposals:
- forcing them to spend more time concentrating on the technology (e.g. getting to understand the system, copying data into this new electronic format) at the expense of developing great content
- a poorly-designed set of questions and/or poor structure, that stops a supplier from “painting the big picture” and describing their best possible solution coherently
- imposing a format that restricts bidders from offering creative options.
And, of course, if you go back to purchasing theory, there’s certain categories of supply arrangements that might lend themselves to this sort of approach better than others. A “Strategic Critical” purchase (few vendors, hard to change, high spend, less price sensitive, security of high-quality supply being key) would potentially suffer more from a lack of creativity than a more commoditised purchase.
I posted t’other day about my fruitless search on Google Scholar for interesting academic research on proposal management.
Drawn back to the same site, wondering what our professorial friends might have postulated regarding purchasing. I couldn’t help but smile when I found that a search on “evaluating sales proposals” returned… precisely zero results!