Most companies have no idea how to draft a RFP.  On the flip side, most vendors have no idea how to respond to a RFP.  When a poorly written RFP meets an inadequate response, we end up with the perfect (legal) storm of litigation.  (If you like litigation, then stop reading and call your therapist.)

Enough already.  Let me teach you some things that will save you hundreds of thousands of dollars.  Maybe more.

Caveat: this topic is too big to tackle in a single blog entry, so I'm going to summarize the main points and break them up over two or three entries.  But if you want the whole thing (plus more relevant info) in one fell swoop, drop me an email and I'll send you my whitepaper, The RFP Process: What My Clients Know That You Don't.  (Catchy title, I know.  But believe me, my clients currently know things about the RFP process that you don't.)

For illustrative purposes, I'll use a typical sourcing / managed services project to show how companies routinely fall short in the RFP process.

The Planning Stage

In their zeal to find a suitable vendor, companies often rush through the planning stage of the RFP process.  Big mistake.  Sometimes, a fatal mistake.  In doing so, companies overlook the nuances of the sourcing relationship that are crucial for a successful venture. 

Remember this equation:  Planning = Participation + Clarity + Humility. 
(This equation is officially known as The Gross Principle of Planning.  Remember: it's my blog, it's my equation, and so I get to name it.)  Now let's break down the equation....

Participation refers to the need for all levels of management to participate in the planning stages of the RFP.  "C" level managers (i.e., CEO, CFO, CTO, etc.) need to be actively involved in the planning stage, since the result of the process will likely have a serious impact on the company's fiscal position and corporate structure.

Other people, such as division directors, field / service managers, and those involved in day-to-day operations may need to be included in the planning stage, since those are the folks who know what makes your company tick at a foundational (i.e., "street") level.

Crucial point:  Some of the planning participants may have personal agendas that run contrary to your company's RFP process.  Why?  Because the end result of the RFP may be to eliminate part or all of those participants' job functions.  If you find yourself in that scenario, don't automatically assume that you need to exclude such people from the planning collective.  It may turn out that the participants won't be let go from the company; instead, they might serve  the company in a different but equally important role after the sourcing process is completed.  If that's the case, let the affected people know that from the outset, then get back to working on your RFP....

Participation may include the use of an outside consultant that can help you guide your company toward the right solution for your company's particular situation.  Check out TPI.  Or Auxis.  Consider the possibility that the best person to help you manage your company through the RFP process may be someone other than yourself—that's called humility.  More on that later....

Include counsel.  No exceptions.  Why?  Because (competent) counsel can think of things to ask in an RFP that you wouldn't think of.  Here's one: how about requiring vendors to propose remedies, in their RFP response, for non-performance? 

Oh—you say you already thought of that?  Of course you did.  That's RFP Drafting 101.

But how about this: how about requiring vendors to propose ways in which they can earn-back credits they may have lost due to non-performance?  How about challenging them, through the RFP, to propose procedures by which they could earn rewards or incentives, such as bonuses or comp time, for a job that exceeds expectations? In other words, how about requiring vendors to come up with their own incentives?  Think about it: you could actually gauge a vendor's motivation and confidence by comparing the vendor's proposed incentive plan against other plans proposed by competing vendors.

Now I KNOW you didn't think of that before.  But I have. 

———————————————————
Stay tuned for the next installment of "Requests For Proposals - Do It Right Already!".