A War Story A Day – 3

Posted by Jon
Enjoying our week of proposal war stories? Here’s our next contributor, Dave:

The following story proves one of the following depending upon your level of cynicism:

a) price is not the be-all and end-all
b) the odds are stacked against you if you don’t have a strong client relationship or
c) it isn’t always a level-playing field.

In 2006 the company I worked for at the time discovered that a division of one of its largest European clients had issued an RFP for an HR solution in the UK.

Unfortunately my company hadn’t been invited to bid as no-one was aware we were an incumbent supplier. In short, we had no relationship in the UK.

Strings were pulled at group level and we were allowed to tender even though we only had 2 of the 4 weeks response time remaining. The string-pulling didn’t win us any allies!

However, our response showed that we had a good functional fit, a good existing European relationship and a significant cost advantage (estimated at 50% less than the other bidders). Indeed the RFP made a big play of the importance of cost, and the price was the highest weighted scoring element. To further emphasise this point the short-listed vendors would have to ‘duke it out’ in a reverse on-line auction.

We were short-listed and when the reverse auction started, we were in 1st place across the board on costs (i.e. lowest bidder). When the auction completed, we remained in 1st place without having had to bid once. High-fives around the office!

A few days later we found out we had not been selected. In the debrief we were told that “If you took out the cost-weighting factor, you came second in functional fit and your refusal to bid a lower price during the auction was seen as a lack of good will”.

Some deals just can’t be won!