Let’s face it – good help is hard to find, and when the options available are seemingly limitless, it’s even harder. But that doesn’t mean you have to settle for anything less than the best.
But where do you start? A Request for Proposal (RFP) is a great first step on the way to finding a vendor that’s right for your project.
So what exactly is an RFP and why should you care?
As Big Bang ERP Account Manager Philippe Girard explains, an RFP is a document that outlines the bare bones of a project (requirements, budget, milestones, key dates etc.) to vendors vying for the partnership.
“A customer comes to us with a project and what they want to achieve out of the project. We reply to that request with everything that the project will involve from our point of view, as well as the associated costs. We’re really upfront and honest about the process,” Girard says.
But the benefits of a business undertaking the RFP process are sometimes beyond what meets the eye. Let us explain.
1. Discovering unrealistic expectations
During the vendor feedback stage, it’s not uncommon to discover that what you had in mind may not be exactly what can be achieved given budgetary, time and other constraints. If one vendor comes back and says the project isn’t deliverable to your dream specifications that’s OK, but if they all say it? Houston, we have a problem.
Feedback may just save you heartache down the road.
2. Getting those boxes ticked
A part of the process of tendering an RFP is receiving and harnessing input from all the business units. Each department within an organization has specific requirements that will need to be addressed.
An RFP, at its core, is one big checklist. Creating such a document gives you a chance to detail and look at all the components that need to be satisfied for the project to be complete. Each stakeholder should have the opportunity to clearly outline what features the software needs to provide and articulate how they will use the solution. In an ideal world, each department should be able to describe what their goals are of using a CRM or ERP system and how success will be measured.
For example, the finance department may need to operate in multiple currencies as a part of the project, whilst the marketing team needs a user-friendly platform to contact customers. Does the solution provider cover both of these bases? An RFP can answer that.
3. The potential to lower costs
Cheapest is not always best, but there’s no harm in shopping around to get the best deal. There may be hundreds of reasons why the least expensive option isn’t right for your project, but negotiating a lower price by forcing the options that ARE right for you to compete against each other might just be a master-stroke.
Girard warns against a price-priority approach, but says competition against the right vendors can see a business save on the bottom line.
“Anyone can undersell. That’s why it’s important for the vendor to be upfront and honest at the very start,” Girard explains.
“What’s important from a customer’s perspective is that they ensure they cut the field down to the vendors who will deliver the project the best, then natural competition will take over.”
As Girard explains, the value of an open and transparent bidding process cannot be undersold, from both the customer and vendor’s point of view.
“From a customer’s perspective, if things go pear-shaped at the back end of a project at least they can fall back on the RFP process to explain what they wanted and the criteria they used to select the vendor, as well as what the vendor promised.”
“From where we stand, transparency means being up front with the customer from the beginning. We will err on the side of over-quoting to ensure there are no nasty little surprises, only good surprises, later on down the track.”
5. Getting out before you’re in too deep
Once you’ve taken in all the vendor feedback on pricing and project delivery, it might turn out that the juice just isn’t worth the squeeze, but how would you know that if you didn’t go through the RFP process?
“There are definitely occasions where we’ve said to a customer ‘sorry, I don’t think you’re ready for this project’. That’s the approach we take because there’s no satisfaction gained from undertaking something that’s undeliverable,” explains Girard.
“It’s good to get that sort of feedback upfront.”