One Simple Question to Win More Proposals

Chasing RFPs Hurts Your Business. Here’s What to Do, Instead.

The Scenario:

“Hey, Lisa. We got an RFP! Can you help us pull it together?”

“Sure, when is it due?”

“Next week.”

“… Oh. Why so short?”

“Well, the RFP hit the street a month ago, and I noticed it on their website two weeks ago. We’ve been talking about it internally and finding resources since then.”

“Do we have an Opportunity Manager?”

“No, not yet, but we have identified a couple of candidates.”

“Who’s the client?”

“ACME. No, we haven’t worked for them before, but we’ve had them on our radar. This RFP is EXACTLY the kind of work that’s in my group’s wheel house. We should at least get short-listed.”

“They probably have providers whom they already know – ones who know more than we do about this particular opportunity. Tell me: why should ACME should pick us over our competition?”

“Well … because, we are REALLY qualified to do this kind of work. We provide this service all the time, and we are very good at it. This proposal will at least get our name out there. AND, we can give them a low price! Perhaps if they see a few of our proposals, then they will eventually award us some work. We can’t win if we don’t bid.”

****

Many days of strenuous proposal development activity follow this conversation. In terms of quality, the proposal is decent.

It answers the RFP requirements. You submit, and you cross your fingers. Meanwhile, your group works on several other simultaneous pursuits, most in exactly this fashion.

The (Too Frequent) Result:

You lose. In many cases, you miss the shortlist completely. Sometimes, your company does win to the shortlist, but then you frequently miss actual selection. Prior to submitting the proposal, if a firm does NOT communicate with clients to position for the specific proposed opportunity, firms miss selection 9 times out of every 10. Or, 19 times out of 20. (Real numbers are difficult to track, since many firms are not inclined to analyze these numbers consistently.)

The cycle repeats. Teams work hard to submit as many high-quality proposals as they can, but your win rate percentage stays low – sometimes even in the low teens. As anxiety rises, teams submit on increasingly “cold” opportunities. Who can refuse any chance of an opportunity, now? Your group needs the revenue, after all, and you can’t win if you don’t bid.

What Are “Cold” Proposals?

Simply put, a “cold” or unqualified proposal is any proposal that your group submits without ever having engaged the client regarding this opportunity. Conversely, a “warm” or qualified proposal is one where you have conducted specific pre-positioning. This means, you have discussed this opportunity with the client. You know something about their distinct needs and concerns. This understanding goes beyond, “This client has heard of our company / we've done some business with them in the past.” A “warm” proposal means that you have some idea about the opportunity’s main challenges, as seen by the client, beyond what can be gleaned from reading the RFP.

Why Firms Lose

If your group is competing in a commodity market, then your actual proposal content would be unimportant. Every client would flip to the back of the proposal, look for the price, and then simply pick the lowest-cost supplier. Some industry folks (in a shockingly large variety of industries) insist that this is what happens, anyway. For the most part (and with the better customers), this assumption is wrong. Most competitive-bid companies operate in a consultative business, which is never a commodity-based one. While price is always important, your customers probably select the winner based on whom they perceive as offering the BEST VALUE.

Firms often lose selection for this reason: they wait until the proposal to try to show/prove/explain their value. Sometimes, firms don’t even try to articulate their value, other than some vague assurances that "We have a great team / we really, really care about our customers / their security / quality / etc."

You cannot convince your clients that you offer the best value if you only start explaining your value inside the proposal itself. It’s too late. Customers are (usually) sophisticated enough to engage with their suppliers prior to RFP publication. If YOU haven’t talked to them prior to RFP release, then you’d better believe that your competitors have.

David G. Pugh and Terry R. Bacon (in Powerful Proposals [New York: AMACOM, 2009]) make this point quite strongly with the data graph below. In responding to “cold” RFPs, we must understand that one or more of our competitors already hold 80-90 percent of the influence. The best, most eloquent proposal in the world is unlikely to win an opportunity at this late stage. (Moreover, how can your proposal possibly be “eloquent,” when you know so little about the client’s true concerns, compared to competitors who have been talking to them all along?)

Job-Seeking Advice

Imagine you had a friend trying to find a new job. He tells you, “I don’t understand why no one has called me. I’ve applied to hundreds of job postings online, but I never seem to get through. And, the jobs I do interview for are low-value, low-pay situations, which aren’t very appealing.”

This is EXACTLY like submitting on a cold RFP. The appeal / allure is understandable: We are qualified to supply this need, so we should at least get considered, right?

Think about what advice you would give a job-seeker in this situation: research likely organizations, see if you can build network contacts, find out what qualities the hiring manager is REALLY looking for, outside of the posted job description. Observe those organizations and try to anticipate their needs.

You want them to think of your group for the opportunity before they post it. We intuitively understand these things, when advising a friend looking for a new job. I suggest we start applying these same concepts to our proposal efforts.

But, Remember that Time When…?

Everyone has a favorite story of a long-shot proposal that your group unexpectedly won. The RFP came out of nowhere – it seemed to fly through the air and land on someone’s desk. The development effort was a nightmare! You didn’t think we had a chance. … And, then, you won! This phenomenon has a name: Confirmation Bias. As humans, we erroneously weigh evidence we feel is positive (i.e., one time we won a long-shot) more heavily than other evidence (i.e., all the other times we lost).

When your backlog declines and your overhead rises, managers can rightfully ask themselves, “We need revenue. We MIGHT win ... or at least get considered. Why shouldn’t we at least try to submit on this (cold) RFP?”

This situation is a real concern, and this rationale is understandable. How can it hurt to send in a package? The problem: while you spend time, resources, energy, and cost chasing “cold” proposals, you have less time to focus on the “warm” ones.

To recap, “warm” proposals are situations where you have a good grasp of the opportunity. The client knows you and sees your firm as a viable candidate. We must accept the fact that a “cold” proposal takes as much (or more) time and resources to develop as a “warm” one does. What if we could craft our “warm” proposals with a higher level of care and precision? Proposal bandwidth is a finite and measurable resource. It seems reasonable to focus time and resources on the “warm” opportunities that you have a much better chance to win.

But, Some Industries Are Different!

“OK, Lisa, you may have a point about cold proposals in certain market sectors, but it’s different in                . The RFPs always stipulate that selection goes to the best-qualified firm. Their procurement process is matrixed and truly non-biased.”

In the quote above, I left the Market Sector as a blank ( ) because I've heard this from every industry or Market sector. Everyone wants to think that they have a chance, particularly if the RFP describes the kind of work or product that your group does extremely well. People positioning for opportunities from government-based clients seem particularly fond of this “unbiased procurement” or "most-qualified-firm" concept.

Studies(1) show that customers from ALL sectors tend to conduct qualifications based on rationality: reason, facts, and data. Those same studies show that clients SELECT contractors based on their emotions: a “gut feeling” about whom they want to work with. They absolutely cherry-pick the data to justify their intuitive decision. This is true even with large commercial or government customers with strenuous, “impartial” grading criteria.

If we trust these findings, then we must accept that we will rarely win a customer in a SELECTION phase based on our qualifications. If their “gut feel” towards your proposed solution is nothing but a big question mark, industry data (2) shows that you are highly unlikely to win selection.

What About Qualifications?

Speaking of qualifications: should we place “cold” Quals packages in the same realm as “cold” RFPs? Absolutely not, with one important caveat: I have observed that some groups tend to submit a “cold” Quals package and then sit quietly. After some time, usually months, they later get the RFP. Having done no further customer development, they proceed to submit what amounts to a “cold” proposal.

So, the caveat for “cold” Quals is this: you MUST engage the customer in specific conversation, post-Quals / pre-RFP. If you fail to do that, then you are likely to lose. I promise you that, at this point, your competitors have engaged the client and have learned more about their needs during this critical time. Given that, what message do you think your silence sends to them?

Here It Is: One SIMPLE Question to Ask Yourself

As promised, here is ONE thing to ask yourself before deciding your next Go/No-Go or proposal pursuit. Answering this two-part question (in the affirmative) will easily triple your existing proposal win rate:

• Have we talked with the client about this specific opportunity? If so, has the client met (or talked with) the person whom we intend to propose as the Primary Solution Designer or Project Manager?

If you can answer “YES” to both parts of the question above, then congratulations! You have just established a QUALIFIED or “warm” RFP. Your chances of developing a winning proposal have just tripled, or better.

Of course, not every opportunity will (or should) involve a face-to-face meeting. You may not want to incur the cost of transporting prospective PMs around the country to discuss smaller opportunities. However, you should, at minimum, be willing to arrange a phone call or (preferably) a video visit.

What to Do, Instead

Rather than submit a constant stream of unsuccessful, generic proposals, you can achieve much better results by maximizing your pre-RFP opportunities. So how, exactly, does a non-BD person begin to think about these things?

It seems tempting to send out a lot of generic proposals – remember our friend who was job-seeking? Direct engagement can feel uncomfortable. It’s fuzzy and vague. We get very few simple answers, and we always risk rejection. Aside from the “One Simple Question” above, here are some additional options for folks who want to boost their proposal chances.

• Commit to internal collaboration: if you have them, ask your BD and various managers for ideas. They can (and should) help you figure out next steps. They may also tell you who else in your company might know this client.
• Conduct background research: let’s say you get wind of an impending RFP. Aside from collaborating with management and BD, and then perhaps picking up the phone to talk to the client, can you research published data? If you aren’t sure how to do that, reach out to your company’s Marketing or Proposal folks for help. How much is the client spending per year? What have been their chief economic drivers? How big a piece of the market do they hold? Has that changed? Recent leadership changes / mergers / acquisitions?
• Engage the client: it feels uncomfortable to pick up the phone and make a “cold” phone call to learn more about a client’s situation. But, if you are going to spend all the time, effort, and expense to develop a Quals package or a proposal, shouldn’t you at least make a few phone calls and try to learn as much as you can? (Some caveats: run your engagement plan by your manager first, to make sure that you contact the client using approved channels. If this is a key client, be sure to ask the assigned Account Manager.)
• Make a personal “Watch List.” Published RFP lists from Government agencies or third-party RFP aggregators aren’t bad ideas. They help us see which entities are spending money. However, this usefulness doesn’t mean that they make good proposal funnels.

Remember the data graph from above. Once the RFP hits the street, you can be about 90% certain that competitors have already positioned themselves for this opportunity. What can you realistically expect to accomplish at this late stage? Third-party RFP aggregators help firms to identify attractive clients. Based on published RFPs, you can create lists of clients for FUTURE opportunities. Get to know them. Host a brown bag informational session. Find out what organizations they support. Learn about their past projects. Find out what they need (or what they think that they need), and how your group can provide it. You will reap much better results if you try this, instead of submitting rushed proposals to organizations who (almost certainly) already have someone else in mind.

Endnotes

(1) See Powerful Proposals: How to Give Your Business the Winning Edge, by David D. Pugh and Terry R. Bacon, pp. 34-37, (New York: AMACOM, 2009).

(2) See Behavioral Advantage: pp. 278-298 and Powerful Proposals, pp. 193-214. In The Behavioral Advantage: What the Smartest, Most Successful Companies Do Differently to Win in the B2B Arena, Pugh and Bacon make the point that clients dismiss consultants who simply “pop up” whenever a new project looms on the horizon. Consistent client engagement ensures that clients will start to see us as their preferred problem-solvers, not as just another firm to fill their bid slates.

About the Author

In 1995, I landed my first “real” job as a Proposal Coordinator for a small engineering and architecture firm in Tennessee. I have worked in the proposal trenches since then. Over my 20-year proposal career, I’ve been fortunate to observe how several engineering, environmental, and technology firms behave as they try to win work. I have observed some robust disciplines regarding proposal strategies, including several training seminars that presented an impressive wealth of concurrent industry data. The pre-positioning approaches I describe above help to boost win rates. This article stands as an effort to capture those insights for the benefit of anyone who might find them useful.