RFP Best Practices
The world of business has changed and our current global economic downturn often serves as a plausible explanation for new trends and developments. Are there visible new approaches companies adopt in the management of business relationships with suppliers? If so, how is the request for proposal (RFP) process affected?
This article focuses on several perceptions of the RFP process in our translation and localization industry. How are RFPs changing (if at all)? What are the good and bad practices in the RFP process? What are some examples of good and bad RFPs?
What is an (ideal) RFP?
A definition by a supply management tools provider gives a good description of what an RFP is: A request for proposal (RFP) is an invitation for suppliers, often through a bidding process, to submit a proposal on a specific commodity or service. A bidding process is one of the best methods for leveraging a company's negotiating ability and purchasing power with suppliers. The RFP process brings structure to the procurement decision and allows the risks and benefits to be identified clearly upfront.
For this article and our industry, let us focus on RFPs that are relatively complex requests for services, requiring more than two days and up to two weeks to respond to (according to most respondents in the GALA survey, it can take up to two working days to respond to a request).
We are focusing on projects requiring a closely fitting response in the form of a document, probably with appendices, as well as reference materials, pricing, information about compliance and answers to RFP questions. Frequently RFPs today use online technologies to manage responses and bidding.
Arguably, each RFP response covering localization services is unique and has to meet specific customer requirements, although some information is repeated in every RFP response or proposal. So a nimble reply to an anonymous request for pricing with a catalog attachment should not count as an RFP response.
From the buyer perspective, "effective RFPs [should] typically reflect the strategy and short/long-term business objectives, providing detailed insight upon which suppliers will be able to offer a matching perspective."
With that objective of transparency in mind, an ideal RFP should be a concise, well structured and documented request with sufficient space for comments, attachments and questions. Planning the RFP as a project and allowing sufficient time for respondents (i.e. the selling organizations) to prepare and respond helps suppliers deliver solid responses and build solutions that add value.
In addition, an ideal RFP should contain clear and complete expectations from the prospective customer, the objectives of individual decision makers on the customer side, and clear and weighted vendor selection criteria. Having roadmap information for the work described in the RFP and sample deliverables is another key point, not to mention clear instructions and contact information.
To continue reading, please go to the full online version of this article, published in the Q2 2009 issue of the GALAxy (GALA Newsletter).