Request for Proposal – the Antiquated Approach to Selecting a Service Provider

Much has been written about the dreaded or necessary, depending on your perspective, RFP or Request for Proposal. Once used as a standard for garnering a level playing field for evaluation, it is now dubbed as a waste of time, energy and money.

Leading industry experts such as Kirk Drake of Ongoing Operations indicate five major flaws with RFPs that are actually counterproductive to the main objective – selecting the right company for the project. He states:

My conclusion is that there are These include:

  • Solutions instead of Problems – In general, RFP’s dictate solutions to your vendors instead of engaging them to solve the problem.
  • Eliminating Vendors Expertise – An RFP generally ask vendors to fit their solution into a box.  This tends to eliminate the vendors expertise around their product and probably doesn’t lead to better prices.
  • RFPs are Biased – RFP’s are often written to favor one particular vendor – making them somewhat biased and not leading to transparency in the decision making process.
  • Partnership – RFP’s tend to eliminate the ability for a client and vendor to actually partner and communicate about an opportunity or problem.
  • Eliminates Innovation – the process tends to eliminate creativity and best practices from the discussion

Not participating in RFP can be just as detrimental to ones business as not submitting at all. However, vendors should be picky about where they invest their resources. Cal Harrison, of Beyond Referrals, indicates there are certain criteria to look for when considering throwing your hat into the ring:

For those who must respond to an RFP, check to ensure these guidelines have been respected. If not, there is a good chance the result will be more expensive and more random than you think.

Does the RFP:

  • Use objective, measurable and specific language
  • Include a project budget
  • Evaluate and score sector and functional expertise only (use a mandatory criteria category for all other relevant criteria)
  • Provide complete, substantial and candid responses to questions from the vendors

Slowly businesses are starting to do things differently. Many organizations are switching to a “Letter of Interest” process. In essence an organization will seek out referrals for two or three business that can potentially meet the criteria of the service required. These referrals can come from websites of vendors, requests from colleagues and peers or contacting industry associations.

The Letter of Interest should include:

  • describe the task or problem that needs to be solved
  • outlines the desired outcomes
  • ask them to provide a response as to why they are interested, and
  • request for credentials to support desired outcome

According to the Centre for Association Leadership, “The consultants’ preliminary responses indicate who is really interested and competent to perform the assignment, as well as their probability for success. After reviewing the responses, you can interview the most qualified consultants to further refine the assignment and assess the person’s capabilities.”

Getting the right service for the job can be an overwhelming process but with a clear outline of your objectives and patience to find the right provider – meaning the one who can do the job not necessarily the cheapest – can help your organization grow and flourish.

http://www.cuinsight.com/are-rfps-good-or-bad.html

http://beyondreferrals.com/fixing-the-rfp/a-decent-proposal-2/

http://www.asaecenter.org/Resources/articledetail.cfm?ItemNumber=37039

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