Why RFPs often suck – and 8 ways to make them better
Most of us have a complicated relationship with Requests for Proposals (RFPs). Whether it is the folks who issue them or those who respond to them, no one seems to find this a satisfactory process. We all agree that a transparent process is essential in the spending of public dollars, but there are many things that can be done to improve how these processes occur.
This article is designed to explore the ways the RFP process could be changed to help support better communities. While many RFPs address commodity-based exchanges, this article focuses on projects where professional and creative services are required.
Worst-Case RFP Scenario Comes to Life
Last year, our firm put together a proposal for an Alberta municipality. It was quite unique, as it had elements of community engagement, visioning, strategic planning, land use planning, and economic development. The description of work wasn’t great and they didn’t share the budget. Unfortunately, we were unsuccessful in our bid. We requested a debrief in order to learn and improve. Here’s what we were told:
- There were 14 firms that bid.
- The bids ranged from $10,000 to $210,000. The average bid value was around $40,000.
- The actual budget they had for the project was $10,000. The winning proposal’s budget was $12,000. They were able to find the extra $2,000.
This is probably the best (worst) example that we have seen of what can be so problematic about the RFP process:
- The scope of work in the RFP was so unclear that there was a cost difference of $200,000 between the highest and lowest proposals.
- No budget was shared to give a sense of expectations and context.
- Both these factors resulted in what ended up being a significant waste of time and resources for most of the firms that put a proposal together. More information would have made it clear the project scope was not a good fit for many firms before they ever put pen to paper.
Common Issues with RFPs
In the vast majority of RFPs, there is a significant lack of clarity around what the host organization is actually looking for. Too many proposals and approaches are based on guesswork; and, in the end, that benefits no one. RFP documents often have the following general qualities:
- There is a lack of clarity on the required work.
- No budget is shared.
- The key information is buried in a mountain of legalese and procedural information.
- Very limited context is provided to explain where the project came from and why it exists.
Quality proposals take a significant amount of time and effort from proponents – we estimate 40 to 50 hours for a well thought out proposal, based on conversations with our colleagues. That’s 560 hours and around $56,000 of combined effort put forward on the worst-case scenario RFP – a project that had a $10,000 budget. It is this kind of situation that creates a domino effect of templates and regurgitation by bidding firms.
The end result is an approach that isn’t remotely close to encouraging the most creative or productive solutions for our communities.
How to Make the RFP Process Better
I understand why the RFP process is necessary. It just appears to have gone down a track that has lost sight of the core purpose: building better communities. With that in mind, here are eight concrete solutions for municipalities to consider.
Solution #1: Share your budget in the RFP.
This is a really big deal. If I asked you to go buy me a car, one of your first questions would be “How much do you want to spend?” Otherwise, you might suggest a Tesla, when I only have the budget for a used Pinto. Sharing a budget helps potential proponents understand the level of effort and ambition that a municipality has for a project.
I have heard people argue: “If we give out the budget, the proposals will just work up to that number.” Yes, they absolutely will. But, isn’t that what budgets are for? They reflect the level of resourcing the organization is willing to put toward a project. Any responsible firm will build their proposal to that budget, and the initiating organization can compare apples to apples.
Solution #2: Put first things first in your RFP document.
All too often, the actual point of the RFP is a needle in a haystack of legalese. In a recent RFP we looked at, the first 18 pages of the document featured the rules, insurance requirements, and legal terms. The first time there was any actual mention of what firms should build the proposal around appeared on page 19, and only 11 percent of the information in the document was project-specific. This has a couple of consequences:
- It means that the people reading the document have to spend a lot of time sifting through information that won’t help them decide if is this an opportunity they want to consider, or what approaches they can recommend.
- It sends a message that the initiating organization prioritizes bureaucracy over impact, which can lead to fewer firms bidding and fewer options to consider.
Solution #3: Frame your RFP project as a problem, challenge, or question.
Often, an RFP will outline the very specific details of the work to be done. This means that the initiating organization has pre-predicted the approach required to address their issue. This can serve to greatly limit the creativity that proponents can bring to the table, which obviously restricts potential solutions. An example of an engagement RFP could be something like: “We need engagement services to deliver six open houses for our project.”
Open houses are just a tool. Going straight to an RFP that’s based on open houses would exclude the discussion of any other tools or approaches to engagement. One of the benefits of bringing in an “outsider” is that you get to access a diversity of skills, ideas, and experiences of a range of firms.
An alternative to this fictional engagement RFP could be: “We are looking for support to develop and deliver an engagement program that accesses the wisdom of the community into (name the issue) and builds stronger relationships with the municipality.”
As much as you can, frame your needs in terms of a challenge or question that requires a solution. This frees up the creativity of the bidding firms and opens the door to a wider array of possible solutions.
Solution #4: Start your RFP-writing process with your evaluation criteria.
In speaking with folks who put together RFPs, a common practice is to get a previous RFP, then make changes where the content varies. At the end of this process is a tweaking of the evaluation criteria. If you start with the evaluation criteria, then you will be crystal clear on the skills, characteristics, and experience that you are looking for in order to facilitate your decision. This level of clarity will greatly focus the actual RFP, with better outcomes all around.
Solution #5: Put page limits on the substantive parts of the proposal.
If you post an RFP, you (hopefully) will be receiving many submissions to consider. Why not make it easier on yourself and limit the length of the proposal? This forces proponents to actually write a proposal that is tailored to the needs of your project, as opposed to copying and pasting material from previous proposals. By challenging proponents to share their ideas in a confined space, you are able to evaluate their ability to deliver tailored solutions for your context.
Solution #6: Share your governance structure in the RFP.
Just about every RFP we’ve seen asks for the organizational structure of the bidding team; but, almost none share their own organizational structure. It’s equally important for the bidding firms to understand the relationship of the actors on the client side, as this can have an impact on recommended solutions or how a project is managed.
Solution #7: Make your RFP document a searchable PDF.
This seems very specific, but as you are looking through a 50-page document to find a key word (like budget, for example), it saves a lot of time and hassle for the firms investigating the RFP. A searchable PDF saves time and grief for everyone involved.
Solution #8: Share your budget.
I know, I already mentioned this. It’s a really big deal. (Refer to Solution #1.)
Building Better Communities with Better RFPs
At the end of the day, the focus of an RFP process should be on creating better communities and improving the lives of citizens. By making some of these changes, responding firms will have a clearer sense of what a project’s needs are, and they will be able to develop novel solutions to a problem. Municipalities will benefit too, since a thoughtful RFP is likely to attract the best firms. MW
A version of this article was published in Municipal World, February 2017
✯ Municipal World Insider and Executive Members: You might also be interested in Denis Chamberland’s article: To flip or not to flip – deciding a tie bid by a coin toss. Note that you can now access the complete collection of past articles (and more) from your membership dashboard.
John Lewis is President and Founder of Intelligent Futures – a firm that works at the intersection of urbanism, sustainability, and engagement. The firm has won awards from the Canadian Institute of Planners, the Alberta Professional Planners Institute, and the International Association for Public Participation.
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