Pursuing a request for proposal (RFP) provides a strong foundation for an organization's ability to stay systematized while effectively seeking innovative solutions for its objectives and generating more business.
Many companies avoid responding to Request for Proposals (RFPs), believing them to be a waste of time. However, organizations that prioritize and pursue RFPs, using an effective RFP strategy, see many successful and positive effects both in the immediate and long-term success of the business.
Changing your organization requires a new perspective and a fresh suite of technology. If you find yourself scratching your head as to how this is possible, here are the main points that highlight how a strong RFP process can positively affect your business:
- Increase Sales Revenue – A well-executed and strategic approach to winning business through RFPs can increase revenue
- Elevate Customer Expectations – Businesses are more successful when proposals meet the customer's expectations as they relate to pricing, functionality, and the quality of service provided.
- Create More Opportunities – When an RFP arrives in your mailbox, it's a business opportunity. By not participating in RFPs, you risk losing that opportunity to the organization that does.
- Revitalize Your Team's Knowledge – Company information changes constantly. Staying on top of the latest internal knowledge is critical for anyone at an organization who is involved in responding to RFPs, and working with outdated content is counterintuitive in winning more business.
An RFP isn’t bad — far from it. It is a great opportunity for your company if you have the right tools and strategy. Let's dive into how your business can leverage the power of an RFP process to drive growth for your organization.
Increase sales revenue with RFPs
An incoming RFP is the potential to generate more revenue. Still, frequently, especially when win rates are low, companies will turn them away because the time commitment required to process them doesn't generate positive ROI.
However, companies that grapple with this issue usually have a manual RFP strategy process in place – but there is a way to streamline this, following these five key steps:
- Address Your Customer Needs – You must grasp the motivation behind the reasons for an issued RFP. Understanding the why will help inform how you respond and structure your proposal.
- Bring Value Upfront – It's hard to price a bid if you haven't figured out the value you're bringing to the table. To get started, calculate the perceived value of your organization. You can prove your value and structure your proposal better if you consider all possible considerations and objections.
- Learn From The Past – Data is king, and you can only acquire more of it by taking on more bids. During your analysis, consider important factors like a win/lost rate, bid pricing, deal size, customer segmentation, etc. Learning from these historical data points, and getting into the gritty details of the bids you previously won, will paint an accurate picture of how you should continue structuring your RFPs moving forward.
- Automate – One of the strongest solutions to a solid RFP strategy is taking advantage of RFP software. The software will provide improvements to your content storage, automate tedious, manual tasks, and save you time, resources, and unnecessary stress.
- Become a storyteller – Having done the heavy lifting, it's time to wrap the bow on the present and deliver a presentable package that consolidates your proposition into a digestible story for the RFP issuer. Keep it short and sweet (under 30 minutes) and find a way to get it in front of their eyes – we're living in an online bidding war, but face-to-face contact will always trump commoditized offerings.
Address the why (customer expectations)
Having already addressed this, reiterating this point is crucial in accelerating your RFP planning strategy. Understanding the why behind an RFP will maximize your chances of submitting a winning bid.
For instance, maybe they:
- Failed to complete the project internally;
- Require an external company with the proper credentials to solve it;
- Are trying to accomplish the CEO's objectives;
- Have concerns about employee satisfaction;
Measure twice, and cut once. Your planning process will skyrocket in effectiveness once you start addressing the why of an issued RFP, allowing you to better structure your proposal.
Generate more opportunities
An RFP is a business opportunity – remember, you miss 100% of the shots you don't take. So, are you putting your best foot forward to win? Because if you're not, you are guaranteed to get swallowed by the competition.
Side Note: Generic claims about being “innovative” and using repurposed product descriptions won't help you gain a competitive advantage over other organizations – you need to focus on your differentiators (something that is both rare and adds value.)
When it's rare but doesn't add value, then it's trivial. When it adds value but isn't rare, the client doesn't understand why they need you. Your proposal should be built around why your organization is better than the others.
To figure out your differentiators, ask yourself these three questions:
- How do you demonstrate the rarity of your solution?
- How much value will your solution add?
- How will your solution help them overcome distress and achieve their goals?
If you force your competitors to respond with new products or price cuts, you know your differentiators are working. If they aren't, your differentiators need improvement.
Give them an unbeatable reason to choose you over someone else by making incremental improvements in your RFP response process.
Boost the knowledge of your team
Your organization's frontline warriors are your salespeople, and having an up-to-date, expansive knowledge repository is the equivalent of having a Swiss army knife always in your pocket. During a time of ever-increasing competition, if your sales team doesn't know about the latest features or pricing of your offerings, they'll probably end up losing sales to a competitor who does.
To prevent this from happening, implement an effective knowledge management system. Assembling all of your data in one place will not only improve communication with your customers but also provide actionable insights to your sales team, which could make or break a winning bid.
A streamlined RFP strategy means more business
By having a well-defined RFP strategy, you can streamline your organization’s proposal process and win more revenue-increasing RFPs, while making your team more productive and better equipped during the sales stage. By building out and sticking to an RFP strategy, your organization will reap its benefits and continue to win more business over the long term.
Photo by Beatriz Pérez Moya.