In January we presented the first in a three-part series on proposal management. The first article discussed how to analyze business opportunities. That article and the remaining two parts to the series pertain to all project/program managers, whether consultants, defense contractors or internal data processing experts.
This second article in the series deals with preparing, reviewing and submitting proposals: specifically, how to organize for a successful proposal cycle, understanding the customer, establishing proposal protocols, isolating evaluation criteria, preparing the proposal, critiquing the proposal, submitting the proposal, conducting a fact-finding mission, setting up and briefing the negotiation team, contract award, and post-mortem analysis (debriefing).
This article also presents specific questions to ask, steps to take, and documents to produce so that management/customer can make the decision on which projects to approve, their priority, and in some cases, which bidder gets the job.
This second article in the series is divided into two parts. Part 2 will appear in the March issue.
Organizing for a Successful Proposal Cycle
Authority Levels. Who has the authority to write the proposal? Who has the authority to represent the company and to sign the proposal? Most important, who has the authority to approve the prices and conditions within the proposal, since a proposal can be construed as an official offer of services and/or product? If this offer is not well conceived because the wrong people prepared it, wrong assumptions are made, or unreal commitments are made, these mistakes can have a broad range of embarrassing consequences, as well as legal implications.
Staffing the Proposal Team. Pick the right people for the proposal team. Choose them for any or all of the following reasons: they have submitted successful proposals in the past, they are intimately familiar with that part of the business, they know (or have worked for) the customer in the past, they are skilled estimators. Create a balance of business professionals and technicians on the proposal team.
Internal/External Advisory Team. Everyone that you may want to contribute to the proposal team may not be available fulltime; therefore, establish advisory teams that will help prepare and/or critique the proposal when their skills are required.
Acceptability of the Team. The team needs to be acceptable to the proposal team leader, to management and to each other. If the people on this team cannot reach a syn-ergistic working relationship, the proposal either will not get out on time or will not be a winning proposal.
Understanding the Customer
Documented History. Pull together every piece of documented history that you can access. Obviously, the RFP or RFQ should be reviewed thoroughly. Any similar proposal that has been submitted, whether or not it was successful, should be critiqued. You can learn from both. Obtain any history on previous projects that can provide background for schedule and/or costs. Get documentation about the customer, what you have done for them before, their style of management, what the trade journals or periodicals are saying about them. This research may seem laborious but it may make generating a winning proposal a lot easier.
Past Experiences. Learn from past experiences. Not just past experiences with the client, but past experiences in producing proposals. Does sending people off-site work well within your organization or is it preferable for each group to produce their part of the proposal independently and then submit it to the proposal team leader for consolidation? Does a quick cut at the proposal, followed by a “Red Team” who tears it apart and builds it back up, work better than attempting to meticu-lously prepare each section perfectly the first time?
Any New Players, Policies, Predicaments, Predilections? Time has elapsed since this business opportunity was evaluated and since the decision was made to bid on the job. Stop and take a look at what may have changed. If there are new players, there may be a new ballgame. Get their input immediately. New policies, organizational changes, or changes in the business environment—yours or the customer's—should be taken into consideration.
Incompetent Customers Versus Personal Arrogance. Don't ever deceive yourself that you are smarter than your customer. The customer will decide which contractor they want to work with. They have a vision of their needs and their perception is their reality. Either bid the job as they ask or bid to the job that you think they really need. If you choose the latter, be prepared to lose. If you know you will lose but cannot ethically bid to the job they are asking, then don't bid at all. It is a waste of your time.
Establish Protocols
Communicate Do's and Don'ts. Protocols are the disciplines that must be followed during the process; for example, pricing is not to be discussed with anyone outside the team; every person (or only one person) will review drafts of the proposal; meetings will be conducted Tuesday and Thursday afternoons between 1–4 and all members are required to be present.
Establish Administrative Disciplines. This is the time to establish the systems that everyone will use while putting the proposal together. For example, all materials will be submitted in a pre-established format, all pricing will be figured on a ten-year payback period, etc.
Schedule Leaders. Writing a winning proposal is a project. So put together a project plan with specific assignments of effort. Leaders representing different parts of the organization, such as marketing, manufacturing, and finance, may control different parts of the proposal: why to choose our firm, the financial bid, the Statement of Work, etc.
The following issues surrounding generating a winning proposal will be addressed in next month's Executive Notebook column:
Three Sections: Management, Technological, Cost
■ Working with Subcontractors (if relevant)
■ Review Approval Levels
■ Types of Contracts: Pros and Cons
■ Parametric Pricing
■ Conduct Detailed Risk Assessment
■ Critique (Verify/Certify) Proposal
■ Is the Statement of Work Totally Responsive to the RFP?
■ Focus on the Right Criteria
■ Numbers Crossfoot and Pass Reasonability Check
■ Use of Compliance Matrix
■ Red Team
■ Submit Proposal
■ Written Proposals
■ Oral Proposals
■ Bidders' Conference
■ Contract Award!
■ Perform Post-Mortem (Debriefing)
■ Transition to Program Management
Isolate Evaluation Criteria
Where to Find Evaluation Criteria. Evaluation criteria were part of the RFP. If the first phase of this proposal process was done well, those criteria were dissected and are thoroughly understood. If there was no RFP, then there should have been (and should continue to be) long, probing conversations with the customer to be sure the criteria upon which the bid is to be evaluated is completely understood by the proposal team.
Understanding Grading Criteria. Grading criteria become the tiebreaker if there is a tie. Find out which of the criteria will be weighted more heavy: pricing versus adherence to requirements, or slick presentation versus content. Although obtaining the grading criteria may be difficult, attempt to get the customer to share this with you.
No bid is worth winning if you lose money in the end or if you do not professionally meet your commitments to your customer. Although this may sound blasphemous, there may be situations in which you price the bid to lose. One reason might be that you feel your company/division should bid on the job even though the job is truly out of your area of expertise. Bid it high enough so that if you get the job there are sufficient funds for expertise, technology, time to do the job right.
Proposal Themes. Pick a theme for the proposal: “We are the best in the business and will supply you with the strongest talent available on this job,” or “We have a better financial bid,” or “Look at how strong we are technologically and the variety of options we are presenting,” or “Isn't our proposal the most professional document you have ever seen?” Keep coming back to the theme throughout all sections of the proposal. Trying to juggle multiple themes at one time will only confuse the customer. Take a gamble and pick the theme that you think will sell.
Past Performance. Emphasize your past performance with this client or with similar clients; with this type of project or with similar projects. Give only those references who are going to say wonderful things about you. Remember to have the courtesy to tell your references that they will be receiving a phone call from your prospective client. Include any samples or examples of similar work you have done. The customer is trying to find some tangible reason why you should be picked above all the others. ■
Joan Knutson is president and founder of Project Management Mentors, a San Francisco-based project management consulting and training firm.
Reader Service Number 5027
Reader Service Number 5008
PM Network • February 1996
