I retired from personal blogging in July 2008.
But you can find me over at http://blog.xero.com.
Chris Quin from Gen-I notes one of the frustrations of the RFP Process.
Quin sees a major stumbling block in the request for proposals (RFP) process, which is where a business asks the technology provider to detail its solution to what the company has in mind.
“Companies only ever get answers to the questions that are asked,” he says. The vendor and customer often find themselves on opposite sides of the fence, and the process becomes combative instead of collaborative.
“It’s important that both client and service provider work together on business problems in a way that creates solutions that can only come from joint innovation,” he says.
Another frustration in the Politically Correct - CYA world of RFP’s is that a number of bidders need to consume hours of effort to respond, yet by definition only one can win. In many cases therefore the total amount of bidding effort (non productive time) is more than the job. Often 10 companies lose 10k of productivity responding to a project worth 50k.
Lost Productivity = (NumBids x AvgBidHours) - AvgBidHours
While there may be some cases when a full RFP is required I would like to see more understanding of the lost productivity of vendors and break out of the less than optimal framework that Chris describes.
- Use more of a Request for Partner at the early stages. That is simply credentials and can be reused. This allows the field to be narrowed quickly,
- Once a partner is selected. Use work-shopping to see how the team works and works with your team. Select 3 partners. With minimal preparation this sets a level playing field for talent and some good ideas may come out. Perhaps there is some cost recovery.
- If a vendor has done similar work before, or won RFP’s before and has good references, then the organisation should be able to select that vendor without retribution. This does not necessarily limit competition as new vendors can always make contact and paint the argument for their particular solution and for a broader evaluation process. Perhaps publishing contracts awarded gives a level of control over that.
Another aspect I’ve noticed is that often the preparation of the RFP is outsourced to a consulting firm. In this case that consultant is motivated to make themselves look clever (and therefore orient the RFP around their solution) and benefit from the RFP and responding process being complex, drawn out and multi-party for as long as possible.
The RFP process is inefficient and is an impediment to productivity. Current procurement practices are a barrier for innovation and growth.
Comment: Colin adds
Agree whole heartedly with your comments. It can be, as you know, an extremely frustrating process especially for smaller vendors and vendor partners who have limited resources in which to respond to large RFP’s, normally electing to decline the invitation to bid. Instead the smaller companies will only work on those opportunities where they stand a better than even chance of winning. That means a Purchaser doesn’t always get to see who is in the market and what they have to offer, regardless of our size.
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