Bursting the bubble of procurement
At a time when Requests for Proposals (RFPs) are on the rise, and firms are increasingly being asked to bid competitively for work, Sarah Barrett-Vane asks: Is procurement about more than simply crunching the numbers?
Procurement exercises are all the rage with larger clients and, if anything, on the rise – not only in the public sector, where they are largely required, but increasingly in the private sector too. Bidding for work takes time and money. How do you put yourself in the best position to win?
Understand your client’s operating environment and procurement strategy
When preparing to bid, you need to get into the client’s mind, as much as you can. You must understand their business. What is their operating environment? What are their pressures, drivers, goals? What disruption is affecting them? How are they addressing this?
I see the following recurring themes while working with in-house legal teams, and strongly suspect that they also affect clients buying decisions across other in-house teams – finance, property, facilities, etc:
- Meeting the demand for more for less
- Driving down spend, possibly internally as well as externally
- Delivering bottom line improvements for the company
- Creating value for company shareholders
- Reducing complexity
- Increasing efficiency
- Enabling technology and digitalisation
- Adopting an innovative approach to the way they deliver services and find solutions
- Dealing with change management
- Taking a strategic approach to multi-sourcing
- Ensuring the internal team has the right skills, both technical and ‘softer’ skills
- Producing meaningful data/business information
- Demonstrating – credibly – the return on investment and value of the in-house team.
The question for bidders is this: if your clients are being asked to work better, smarter, faster and cheaper, how can you, as a supplier, enable them to do this?
It’s a buyer’s market
Clients have the power to influence and shape the market by what they buy and who they buy from. Are they looking at the new entrants, the disruptors in the market, or are they happy to stay with the status quo? Do they wish to reduce the number of suppliers on their panel? If so, why and to what? Are they encouraging joint or collaborative bids?
You will only get to the detail of a client’s strategy by understanding them (if you are an incumbent) and/or by doing your research.
Who is involved in the procurement and where does the power lie?
Various people may be involved within the client’s organisation besides your main contacts. You cannot (safely) assume that the people who know you will be the chief decision makers.
Who might the influencers be? The obvious players are the end users, your primary contacts. Possibly various grades of personnel with different degrees of influence depending on how work is allocated and by whom.
In some organisations, the decision may be taken right at the top, by your ultimate client. Procurement may be there simply to carry out a ‘tick box exercise’ as the process nears completion. Or they may have a substantial role. You can’t assume anything. You need to find out the answers to these questions. If they are not in the documents, ask, if you feel you can (and it’s not that easy).
How can you influence market perception?
Look at your sphere of influence.
Bidders need to be within the client’s sights – either as an incumbent (ideally an impressive one) or as a potentially interesting new proposition. How can you get in, and stay in, with the right people?
Think about who you know, or ought to know.
- Who are your direct client contacts?
- Who is at the top of the decision making process?
- What is Procurement’s involvement? Who do you know?
- Who is in your client’s peer network? Who do they talk to? Who are they influenced by? What do they read?
- What external events could you attend to boost your profile and influence relevant people?
- How can you get to the right people, and then keep that relationship fresh?
If you are an incumbent, it is much easier, providing you keep your eye on the ball and don’t become complacent.
If you are publishing articles or speaking at conferences, what you say must resonate with clients. Impactful storytelling is not easy to get right, but can be very powerful. What do your clients want to read about? Things that affect them. So address that. Make your communications count.
Choose your words carefully. It’s not about you. It’s about them.
What are clients looking for?
No one size fits all. Ideally, clients will tell you what they are looking for in their tender documents, in conversations and via articles or conference appearances. Clients – almost universally – are looking for solutions to problems. Not advice for its own sake, but outcomes.
What a client wants should be apparent from the criteria and questions listed in the tender documentation. In the public sector, clients must share their weightings for quality and price – eg. 70:30. You will get a steer from this.
In my experience, top qualities clients are looking for include:
- Quality of service – befitting the work in question, so this could be 3*, 4* or 5*, but arguably never less than that
- Budgeting – the ability to scope a matter and come in on budget
- Effective communication
- Innovation and technology
- Collaboration – with the client, across the panel, even across the industry.
Bidding to win and avoiding common pitfalls
You need a robust ‘go/no go’ decision process in place before you even put pen to paper. ‘Play to your strengths’ is the key message.
Prepare, prepare, prepare. Get your winning team in place. If you need external help, brief your chosen consultant/s early and thoroughly.
Then: Read > Tailor > Answer
Some of the most common pitfalls I see are:
- A failure to read the documentation – really read it, and find the key words that matter
- A failure to tailor the response to the client’s brief – it must be bespoke
- A failure to answer the question – the question on the page, not the one in your head
- Poor examples – not pertinent, recent or punchy enough
- Laziness/complacency – particularly with incumbents
- Failure to follow the rules – especially in public procurement
- Mediocre, turgid, rambling writing style displaying no personality
- Mismatch of personnel in interviews.
Your bid must be memorable and relevant. It must differentiate you from the competition.
Quality and value
My session at the PM Forum Conference in September is titled, ‘Bursting the bubble of Procurement – more than just crunching the numbers’. I am firmly of the view that the numbers are only one part of your bid. Quality is, for the vast majority of clients, still the ultimate decider. Yes, you will still see a tender where price clearly matters more than quality, and I would ask: is that opportunity for you? Providing the end user has a say in the appointment, a client is highly unlikely to risk quality of service and outcome simply to save the odd buck. If something sounds too good to be true, chances are it is.
Procurement is about far more than crunching the numbers. It is about finding the right suppliers to do the right work in the right location with the right people, technology and processes at the right price. If you can offer all of that, tailoring your response to the specific opportunity and bidding at a sustainable yet competitive price, you will be offering the client that perfect combination of quality and value.
Sarah Barrett-Vane works with in-house legal teams to buy and manage legal services. Coming at procurement with a client’s eyes, Sarah enables legal services suppliers to write winning bids that address clients’ needs. www.sbvconsulting.co.uk.