“As soon as this step is completed, all internal and external meetings can be fixed.”- Mark Schenkius in today’s Tip 823
How about you? How do you process your RFP?
Join the conversation below and be sure to connect with Mark!
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Scott Ingram: You’re listening to the Daily Sales Tips podcast and I’m your host, Scott Ingram. Today’s tip is part one of a two-part series from Mark Schenkius. Mark is the founder of ROI 10 where he helps sales professionals get better at dealing with buyers. He’s also the author of “The Other Side of Sales,” where he shares his perspective after 15 years in procurement. Here he is:
Mark Schenkius: Hi everyone. I’m sure you will all be familiar with the Iceberg Analogy, which is used for many business-related topics these days. Typically about 10% of the volume of an iceberg is above water, which follows from Archimedes’ Principle of Buoyancy. The other 90% is below the surface and it’s difficult to see. Do you know that this principle applies to RFPs as well? As a seller, you only see a small fraction of the entire buying process.
In 2 Daily Sales Tips, I’ll share the 16 steps a buyer has taken before you actually get to see the RFP. They are in chronological order. Although it can depend on the buyer you’re dealing with.
Today, I’ll share a step 1 to 8.
Step 1: Market assessment. The very first step for a buyer is to assess the market. How does the market look like currently? What are the dynamics on this market? And importantly, are there enough suppliers available?
Step 2: Decide on the procurement approach. If there’s only one suitable supplier on the market, buyers will prefer to negotiate directly with them. Otherwise, they will focus on running an RFP. Obviously, they need competition to get the best result from an RFP.
Step 3: Project team creation. Next buyers will form a team with our internal clients to ensure the outcome is accepted throughout your organization. Mainly these team members focus on quality, service, or they are technical experts in their respective fields. As a seller, having this information helps to be able to influence the decision-makers.
Step 4: RFP scope agreed. The whole team then agrees on the scope of the RFP process. They decide what is in and what is out of scope. This also includes a decision to source locally, regionally, or globally.
Step 5: Objective setting. During this step, the team decides what they are trying to achieve. Is it just about price or do we focus on quality, surface, risks, sustainability, and or other criteria. From a sales perspective, it definitely pays to have access to this information.
Step 6: Senior management sign off. During this step, the whole project team presents the plan to the senior management team for sign-off. If they don’t sign off, it means going back to the drawing table. Otherwise, they can proceed as planned.
Step 7: Stakeholder mapping. Once they have received an “Okay” from senior management, they map out all stakeholders who are directly or indirectly impacted by the RFP. This way they assured the project can be executed. Once the final decision is made. If a buyer skips this step, it might mean they have troubles later on trying to implement the final outcome.
Step 8: Tender time plan creation. It’s now time to create a tender time plan. Typically this means working their way backward, starting with the implementation date. As soon as this step is completed, all internal and external meetings can be fixed.
That’s it for today. I’ll be back shortly, but steps 9 to 16. Happy negotiations, everyone!
Scott Ingram: For more from Mark, click over to DailySales.Tips/823 where you’ll find links to connect with him and his company, ROI 10 as well as a link to get your hands on a copy of his book: “The Other Side of Sales.”
Then, be sure to come back tomorrow for part 2 to hear the rest of the RFP Process Explained. Thanks for listening!