Managing the Proposal Process

June 14th, 2010

There is no room for the shotgun approach to selling in today’s customer-driven, competitive environment. Responding to a request for proposal (RFP) that falls within your company’s general area of expertise is costly and likely to be inefficient, at best; developing a proposal for every RFP that comes in can be foolhardy.

It is the sales manager’s responsibility to see that your sales force targets the appropriate market segment and that they develop proposals only for potential customers who are a good fit for an ongoing working relationship. The best potential customers in order of preference are:

• An existing customer with a new need that’s closely identified with the goods and services you are already providing
• An existing customer with a need in a department not previously serviced by your company but with needs related to your core competencies
• A potential customer whose needs are well aligned with the core competencies of your company
• A potential customer who has come to you in the context of a system solution worked out by one of your strategic allies

Two considerations can help you determine whether to develop a proposal in response to a particular RFP. First, identify the real needs and problems addressed in the RFP. Second, evaluate the degree of fit between the needs of the customer and the genuine expertise of your company relative to the competitors who would also be bidding for the contract. The question you need to answer is whether the expertise and product line you bring to the situation can be placed at a competitive advantage relative to the competition. And, if the answer to that is yes, you need to determine how you can position yourself relative to the competition.

Targeting the right audience in this way enables you to avoid many of the pitfalls of the proposal process. The sales manager – maybe along with the manager of the marketing department – must constantly monitor the selling process to curb the tendency of the salespeople to pursue seemingly promising prospects with time-consuming and costly proposals that would be unsuccessful at best and successful but unprofitable at worst.

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