Responding to an RFP, or request for proposal, is like playing an Olympic-level team sport.
Planning and strategy can mean the difference between success and failure. Every team member fulfills a specific role in the journey towards a win. And the potential payoff? Well, it may not be a gold medal or international prestige, but winning massive revenue is pretty great, too.
An RFP is a document that announces the details of a project, with the goal of soliciting bids from companies who can deliver on this goal. Governments and organizations with complex project needs use the RFP process to compare vendors against a standard set of criteria, so they can choose the most qualified vendor to complete the project. Winning a bid is a big deal because RFPs can be attached to contracts that pay millions of dollars.
Operate with more contributors. 10 stakeholders seems to be the sweet spot.
Invest more writing time than average in each RFP. 25 hours, compared to an average of 23.
Use RFP response software. 69% of high performers automate parts of the process.
Track key success metrics. 91% of top performers show diligence in this area.
If you want to learn how to hit these benchmarks, you’re in the right place. In this article, you’ll find out:
How top-performing teams write their RFP responses
Where to get free resources to improve your RFP responses
How to scale your process to respond to more RFPs
Which metrics matter most when tracking RFP response performance
Note: All data in this article is derived from Loopio’s 2021 RFP Response Trends Report.
What is an RFP response?
Let’s start with the basics. An RFP response is your set of answers to the questions and criteria within an RFP. The goal with your RFP response is to demonstrate unique value. When you respond to an RFP, you’ll likely be drafting the following:
A cover letter
An executive summary
A description of the team doing the work
Evidence of past performance or successfully completed projects
A description of deliverables
Your strategy for delivering the work
A company overview
A contract agreement
You should be answering an important question: Why should [company] choose you over your competitors?
That answer has never been more important. In a survey of 650 teams across North America, research shows that RFPs are worth a whopping average of 35% of a company’s annual revenue.
Winning that type of business isn’t easy. RFPs come with a set of specific requirements and tight deadlines. Research shows that most RFPs are turned around in three to five days – and nearly 40% are completed in 48 hours or less. So what does it take to whip up a high-quality RFP in almost no time at all? Let’s dive in.
How to write an RFP response like a winning team
You’ll remember from earlier that top performing RFP response teams spend more time writing their responses: 25 hours rather than the average of 23. Those two hours may not seem like a lot of time, but when they can mean the difference between millions of dollars and, well, nothing, it’s worth investigating how to spend that time.
So how do the pros spend their time? Here’s the winning process.
1. Make a plan
There’s no such thing as winging it with an RFP. Top performing teams assess the landscape before they dive in: they evaluate their prospect, their competition, and the internal resources they’ll need to submit a high-quality response.
When you receive an RFP, that’s your cue to formulate your plan of attack. Here’s what to include in your RFP plan:
Prospect call. Clarify that you understand the requirements of the RFP, and uncover any nuances about your prospect’s company and key stakeholders that may not be explicitly mentioned in the RFP. For government-related proposal efforts, this could include attending a formal Q&A session.
Competitive research. Know thy enemy. Perform some competitive analyses to understand your competitors’ strengths and weaknesses, so that your response takes a holistic view of the market.
Key stakeholder roundup. Gather all your subject matter experts, sales reps, proposal team members, security team members, and anyone else whose expertise you’ll need to draft a better RFP response.
Project kickoff. Get your team on the same page with a kickoff meeting and set expectations for delivery timelines. As we mentioned, response turnaround times tend to be quick, so you’ll need to make sure everyone you need is available when you need them.
2. Do your research
Before you start writing your RFP response, gather some information. When you frontload the work of a response with some research, writing the response will become much easier. There are two types of research responsible for successful RFP responses:
External research strategies:
RFP annotations: Run through the RFP and make notes about unanswered questions, competitor offerings, and any existing data you may have.
Prospect call or Q&A briefing: Clarify your prospect’s pain points and goals with a prospect call or by attending the formal Q&A session for government proposals.
Competitor analysis: Make detailed lists of your competitor offerings, and consider a SWOT analysis for each (strengths, weaknesses, opportunities, and threats).
Internal research strategies:
RFP response library: Search your organization’s previous RFP responses and pull information that can help with your current response.
SME knowledge: Determine which internal subject matter experts you’ll need to make your response credible and effective.
3. Refine existing RFP answers from past responses
If you can help it, don’t reinvent the wheel with your RFP response. That’s like asking for more work. Reduce your workload, reuse content, and recycle past answers. Your most recent winning RFP responses are your best friends. Before you start creating new answers, gather all the content you possibly can from past responses first.
4. Fill in the gaps with new expertise
After you gather all relevant past content, compare it to your current RFP and assess whether there are any gaps. This is the fresh content you’ll need to create with your internal stakeholders, including your SMEs.
5. Edit with three key questions in mind
RFP-writing pro Lisa Longley of Weber Associates recommends asking these key questions when editing an RFP:
Is your RFP content compliant? Make sure you’re answering every single part of each question in the RFP. Otherwise your response may not be considered compliant and it will be thrown out.
Is your wording clear? Don’t alienate your prospect with jargon. Write acronyms out in full, and always explain industry terms. Never assume knowledge, and always write like a human being.
Does your RFP response tell a compelling story? Master the art of persuasion. Tell an interesting story, but back up your claims with relevant examples that demonstrate value to your prospect.
6. Improve future RFPs with online resources
Your work isn’t over after you submit your RFP – at least not if you want to make future responses better.
Sharpen your RFP response skills with these courses:
It’s not rocket science, but it is the law of averages: top-performing RFP teams submit more RFPs.
The research shows teams that win more than 50% of their RFPs submit an average of 175 responses per year, as opposed to the average of 147. That’s 28 more RFPs per year, and all the more chances to win.
Let’s do even more math: If the average team spends 23 hours per RFP response while top performing teams spend 25 hours, that’s a difference of almost 1,000 hours per year.
Top teams tend to be better resourced, so they're in a better position to submit more RFPs. More resources mean more RFPs submitted, and that means more money. The cycle continues. Larger teams have more tools to be more efficient.
But simply increasing RFP volume isn’t the secret to success. Teams should prioritize efficiency over volume to maintain a sustainable process that lasts. Here’s how teams of any size can maximize efficiency to produce more RFPs and win more business.
1. Ruthlessly prioritize customer fit
Not every RFP is worth responding to. Before starting a proposal, 72% of organizations assess an RFP with a go/no-go framework.
You may be able to tell right away when a project isn’t a good fit for your organization. Whether it’s because you don’t have the resources to complete the work—or one of your competitors does something better than you do, you’ll want to weed out the unlikely wins so you can spend more time on the ones that are a perfect fit.
Key questions of a go/no-go framework
How is the existing prospect relationship? Do you have a history with this prospect? Is it good or bad? If there’s some prior bad blood, you’ll need to gauge whether or not it’s worth trying to overcome to win the business.
Do you have competition for this contract? Odds are, competitors will be nipping at your heels to win the contract. Be honest: Are they a better fit for the work? If you think so, your prospect likely will, too.
Do you have resources available? Let’s say you do win the contract. Will you be able to deliver? Never bid on contracts you can’t fulfill. Short-term wins that lead to long-term problems aren’t real wins.
What’s the value of winning? Assess the cost of the work versus the value of the contract. A quick cost-benefit analysis will tell you whether or not you should go ahead.
2. Assign a dedicated RFP process owner
Teams with a dedicated RFP response owner are more likely to feel satisfied with their RFP responses. So who typically owns the process? Here’s a breakdown according to research:
Most organizations who are invested in the RFP process to win business have dedicated RFP teams to handle the workload, but that’s not always the case. Sometimes the sales team owns the process, or the marketing team can own it. In some cases, ownership is on an ad hoc basis, although that’s really not recommended.
If your team doesn’t have resources for a dedicated proposal team member, we recommend creating a standard intake process, and assign a point-person from the sales enablement, or sales operations team to take the lead.
3. Involve more people in your response
You may think smaller teams are more effective at rolling out a successful RFP response, but research shows the opposite to be true: the more people, the stronger the response.
Larger RFP response teams come with some challenges. It can be a hassle to ask SMEs to take time away from their regular workload to submit responses, especially when you’re racing against the clock.
But according to Jenny Citron, bid specialist at Simpleview, there is a way: “Give your SMEs as much time as humanly possible to answer questions. If I’m reviewing an RFP and I need their help, I’ll send them a message right away letting them know that I’ll be sending over questions to them later. My SMEs really appreciate the heads up so they can adjust their schedules.”
4. Use RFP software to automate your process
It’s 2021: No top performing team is answering RFPs with old school tactics.
Invest in RFP automation software to help you scale your process. According to the research, 69% of top performers use RFP response software to manage proposals. The main benefits of using RFP software include improvements to content storage, closely followed by time savings, and (of course) the automation of manual tasks. The research also found that RFP software users respond to a significantly higher number of bids each year than non-users.
RFP metrics tracked by top teams
You can’t improve what you don’t measure. The majority of teams (90%) are tracking RFP success metrics, but are they tracking the right ones in the right way?
The research shows that less than half of people are tracking RFP win rate. This is shocking, considering it’s arguably the most important metric besides revenue.
If your organization isn’t tracking RFP win rate, start small and don’t overthink. Start a shared spreadsheet and keep track of the number manually if you don’t have the software. Then have a look at some of the other most commonly tracked metrics and begin measuring them in whatever way is possible.
Revenue won. The metric that matters most: revenue won from RFPs.
Number of bids won. Tracking closely with revenue, the number of bids won is a leading indicator of success.
Number of bids submitted. Tracking the number of bids submitted is vital for determining win/loss rates.
Customers retained through RFPs. This seems like a no-brainer. Repeat business is key to success, after all.
Top performers track employee sentiment
Research from the University of Oxford shows that happy workers are more productive, yet only a small percentage of teams (16%) are tracking employee satisfaction or sentiment. What’s telling is who exactly is tracking this metric: it’s top-performing teams. While this is correlation rather than causation, the link is there: better provisioning for staff and actually caring about their opinions leads to more productive work.
Factors influencing RFP metrics tracking
You may be thinking, Why doesn’t every team track RFP metrics? If RFPs are generating as much business as they do, you’d think every organization would invest in analytics to improve their chances of success. In reality, there are several limiting factors that influence whether or not a company tracks its metrics, in addition to the quality of the analysis. It comes down to three factors:
Employee levels. Companies are run by people, and people have varying degrees of access to data. Executives need to care about metrics to invest in tracking, too.
Company size. Some companies don’t have the resources to track metrics. A small company may have limited budget to dedicate toward metrics tracking, which requires software and human finesse.
3. Software use Not all metrics tracking software is created equal. Some may be better than others at extracting the exact data you need to reach your true goal: actionable insights. Plus, some systems connect better with other tools in your techstack, which can also impact tracking (like connecting your RFP response softwares with Salesforce).
3 easy ways to improve your next RFP response
You just learned a ton of new information about how to improve your RFP process for more wins. If that was a lot and you need some help prioritizing, here are the top three most effective ways to improve your next response:
Use a go/no-go framework. Develop a solid process to qualify or disqualify RFPs from your response process. Oftentimes it’s what we don’t do that sets us up for bigger wins.
Consider using RFP software to handle the low-value work and tedious tasks. Ditch the repetitive grunt work by using RFP automation to manage the tedious tasks for you (like formatting, exporting, and tracking down SMEs) so you can focus on more strategic tasks like crafting quality answers and keeping your stakeholders happy.
Kathryn Bennett is the director of RFP excellence at Loopio, a software company that streamlines the RFP response process for companies like IBM and DocuSign. Loopio serves more than 900 organizations and has ranked on the Deloitte Technology Fast 50™ list for two years in a row.