Today’s guest blogger is Jacob Cynamon-Murphy, a Sales Engineer at Sonoma Partners.
Customer: “I want to know, beyond a shadow of a doubt, that your software, your service, and your strategy are going to work for my business.”
Vendor: “Yes. Yes. Yes!"
Although this conversation is purely fictionalized, a RFP process often looks a lot like this.
- Step One: A customer produces a giant Excel spreadsheet with hundreds (or thousands!) of requirements.
- Step Two: The customer sends the RFP to a bunch of different CRM vendors
- Step Three: The customer asks these vendors to rate each line item in the spreadsheet with information such as:
- Included as "out-of-the-box" capability
- Supplemental or 3rd party extensions, with separate license
- Supported through nominal application configuration
- Customization of application is required
- Function/Capability planned in imminent future release
- Function/Capability not currently available
From an outsider’s perspective, this seems to make enough sense. “Hey, once we have all our requirements scored and rated we can make a great decision!” Unfortunately, I am sorry to report that we frequently see a lot of time, energy and effort wasted by customers on RFP…and the probability of selecting the right CRM platform doesn’t increase just because you issued an RFP.
In an effort to help customers improve RFPs, I’ve put together a list of three key areas where things can (and usually do) go wrong during the RFP process.
Sometimes this goes well - the procurement department, the selection committee, or the RFP consultant does a phenomenal job understanding the pressing business needs and opportunities and translates them into a concise requirements list that can be responded to with ease.
More often than not, the RFP has 2x or 3x the number of questions necessary to understand the problem space. The result? Additional time expended by the vendors attempting to respond AND the procurement/selection committee in reviewing those responses. Another issue is that the Excel list of requirements rarely prioritizes which features are the most important. This feature prioritization could have a huge impact on design decisions (which later impact time and budget).
I have also seen RFPs that were clearly boilerplate, including a number of elements that didn't apply to the project under proposal. For the RFP to be meaningful and valuable, it must align with the organization's true needs.
True story - on a technical survey for an RFP I completed in 2013, there was a line item for COBOL support; when pressed on this, the RFP consultant (whom the organization was paying a lot of money to advise them on their CRM selection) admitted that there was no actual need for COBOL support.
Too Many Vendors
We have received RFPs where the customer invited over a DOZEN vendors to respond. Analysts like Gartner and Forrester do the heavy lifting so you don't have to - picking up a research report for the area you are trying to address will give you the top names in the space. Check out the Gartner Magic Quadrants and the Forrester Wave Reports to get started.
You don't need to engage a consultant or spend countless man-hours researching different platforms to find the top CRM players in your space (hint: it’s Salesforce and Microsoft Dynamics CRM). If you tell a vendor that you have submitted the RFP to more than a handful of competitors, the likelihood that they'll respond drops significantly.
There's an old rumor that the Ivy League universities compare applicant lists and drop candidates who apply to too many because they assume the applicant isn't interested in the unique value of the individual universities. Sending your RFP to a dozen vendors feels a bit like that.
Restricted Access to the Business
I have responded to many RFPs over the last few years. Usually, the RFP process drags on and takes much longer than the customer originally anticipated. Finding a great RFP consultant might aid in keeping the process on track, but even that can only help so much. RFPs take a lot of time and don't always yield a better result. Therefore two things I recommend for all customers is that they:
- Organize a CRM selection committee
- Make sure the selection committee spends enough time meeting with each vendor face-to-face
These meetings will help you determine which vendor has the best functional capabilities and ultimately, who would have the best rapport with the customer’s project team. These two tactics are much likely to result in a more effective vendor match than dragging your way through an RFP.
Please don’t take these suggestions the wrong way – RFPs still make sense in some scenarios. However, when you are at an organization where time itself is money, you’ll get to the same results faster by taking the best pieces of an RFP process – a selection committee, guided discovery of key requirements, and interviews with the most-recommended vendors – and avoiding the dreck.