Posted by Joanne Morrison,
Director of Marketing, HGS Canada
There’s no doubt, strategic sourcing is a tough job. But so is the task of proposal respondents who may have to wade through dozens of attachments and hundreds of pages of fine print (often over weekends and holidays) trying to decipher what the client really wants. Ultimately, the goals of both parties are the same. The responding company wants to prepare a solution that will be of real benefit to the client and the client wants an RFP response that shows an understanding of the issues and provides high value, practical solutions to solve their problems. By following these five rules, you can ensure that your next RFP process gets the solutions your company needs to make real improvements to the business.
- Be clear about the problem you’re trying to solve. Many companies may be hesitant to reveal their bumps, bruises, and blemishes. If you’re concerned about revealing too much, absolutely issue an NDA to participating companies to protect confidential information. But don’t hold back important details that make it impossible for suppliers to calculate accurate pricing or understand specifically what you’re looking for. Don’t be afraid to explicitly describe your challenges. Ultimately, if suppliers don’t have all the information, the solutions and responses will miss the mark.
- Give your RFP participants the opportunity to course correct their solution. Giving participating companies the opportunity to ask clarifying questions is usually a standard part of the RFP process. However, allowing suppliers a confidential 30-minute time frame to pitch their solution in advance of the submission deadline can give you a better chance of getting exactly what you want. If your company had a terrible experience in a certain geography or a business owner hates a certain technology, make sure the participating suppliers understand these potential deal breakers before they waste their time and yours.
- Get specific in your questions. Having worked as a proposal writer for outsourcing suppliers, I can tell you that we love generic questions like “Can you describe your training process?” Questions like this allow us to put our brains on hold and plug in a boilerplate response. If you’re receiving responses with one of your competitor’s names throughout or, even worse, the dreaded “Insert Client Name Here,” faux pas, you have entered the land of boilerplate and you will get nothing useful from this response. Get specific. For example, if you have diverse product lines or a blended onshore-offshore environment ask questions that will force suppliers to figure out how they will get the job done under your unique circumstances.
- Don’t be too prescriptive. Every sourcing opportunity will have certain guiding parameters but give suppliers enough room to be creative in their solutioning. You are talking to them because they are experts in their field and have implemented similar solutions in the past. The most experienced suppliers will often propose transformative ideas that you may not have thought possible in your current environment.
- Be fair to your suppliers. A sourcing relationship between a client and supplier is a partnership that can, if successful, last for decades. Like any relationship, it’s important to start from a position of trust. The best and longest lasting relationships I’ve seen have been with clients that wanted to ensure the supplier would receive an appropriate margin on the business. At the same time, an outsourcing supplier confident in its ability to add value should be open to discussing risk-reward pricing models and should be prepared with strategies to reduce costs through continuous improvement over the life of the contract.
A successful RFP process hinges on great communication. By clearly communicating the high-level, long-term and shorter-term tactical goals of the program, you can ensure a win-win situation for buyer and supplier.