One of the most common questions proposal managers encounter is “should we respond to this request for proposal?”
It appears that this question is more often encountered in smaller organizations, as they have to make hard decisions when it comes to allocating resources in the RFP response process. In contrast, larger organizations have their own RFP departments. Today we’re going to focus mostly on the individual or small vendors and the ideal approach for them in such situations.
The short answer to the question above is “it depends”. To be more specific, aside from the size of the organization, it depends on the overall request for proposal requirements, the risk of not getting the RFP award, its size, as well as many other factors.
One of the most important aspects which determine if a request for proposal is worth responding to is having an efficient workflow. As previously stated, in order to create a proper RFP response process, you should take into account all stages of putting it together. This means starting with the moment the proposal triggers that “let’s do it!” reaction all the way to when you are finally ready to send it to your potential customers.
This efficient workflow is all about checking things meticulously using a comprehensive checklist. This helps to streamline the entire RFP response process and raise the likelihood of getting where you plan to.
Let’s take a few minutes and discuss a few of the most important factors one should take into consideration when evaluating a request for proposal.
3 factors to help you decide if a request for proposal (RFP) is worth responding to
1. Is it the right fit for your business?
An RFP is clearly a great opportunity for your business, but you shouldn’t accept it just for the sake of doing it. If, in the past, you have done business with a company with the same profile, take a first look at past success metrics. If the data points out to a poor fit and accepting the RFP looks more like a long shot, our recommendation is to have a cautious approach.
Start by asking yourself some questions like:
- Do I know enough about the niche?
- Do I know enough about what the company needs and the challenges it faces, but also how to solve them?
- Does this company fall into my target market?
Moving on, one more factor that you should consider when analyzing a request for proposal is your relationship with the prospect. This can have a powerful influence on the success of the submitted RFP.
If this relationship exists for some time and, even better, it’s one built on trust, you will be able to better detect the sense of the prospect’s needs and timelines. This also gives you the possibility to ask questions which can clarify everything.
In order to figure out the status of your relationship with your prospect, here are a few questions you should consider asking yourself:
- Have we done any successful business with this organization until date?
- Will responding to the RFP give me access to further collaborations with them in the future?
- Do I get access to key contacts, to get more information?
3. Internal resources and timeframes
Over the years, we’ve learned one important thing: a request for proposal with a tight timeframe will automatically result in a rushed job. This can also have a higher likelihood of a missed opportunity. Considering this, one of your missions is to determine if you have the proper resources available. This also includes access to subject matter experts in the timeframe needed to complete the request.
If the time is limited, it’s a clear sign that you should take a moment to think about the cost of pursuing this opportunity. Is it worth spending precious time on a deal that’s not going to be worth it? Weighing this against the opportunity is a great way of prioritizing which RFP you should pursue.
Remember: last-minute requests could be a sign that the prospect already has a vendor in mind and might only be issuing an RFP to comply with their company’s internal procurement process.
To wrap it up, these are some of the questions you should ask yourself:
- What’s the final cost of pursuing the opportunity?
- How many people do I need for this?
- To meet this specific deadline, do I get access and buy-in from the right stakeholders?
These are three of the most important aspects which should help you decide if it’s worth investing time in a request for proposal. This doesn’t mean that the list of criteria to assess stops here.
Account value, knowing the final decision-makers, the opportunity for discovery and dialogue, knowing the competition, solution presentation manners and, of course, deadlines, also weigh a lot when a manager is trying to figure out if responding to an RFP is the right thing to do.
It’s more than obvious that weighing an RFP against all the above-mentioned criteria can help you gain a lot of clarity on the value of an opportunity. Yes, not all requests are worth responding to, not to mention that it’s almost vital to have a well-documented process when it comes to determining if an RFP is worth a response.
Our recommendation is, to begin with developing a go/no-go process. Start with a few specific questions that you and your team should be answering when considering an RFP. As for the response process itself, it can be very cumbersome if you lack a structured way of dealing with all the moving parts.
Last, but not least, before starting writing your request for proposal, keep in mind that there are a few common mistakes a lot of people make throughout the process. To err is human, but you can read our article to learn how to avoid making these mistakes, and save precious time.