Win That Contract 2013

Page 1

The 23 biggest mistakes that bidders make

Presented by

David Harrison www.winthatcontract.com

Thank you for downloading a copy of the 23 biggest mistakes that bidders make. The original report was written in 2008. It is certainly a different world now in 2013 and the new report reflects the changes that have occurred in the competitive environment. I genuinely hope that it provides some insight into what clients and their procurement evaluators are looking for and enables you to improve your chances of success in what is a highly competitive and challenging economy. If you like the report then we would be grateful if you would recommend it to others. Social media links have been added below to assist with this. Best wishes and good luck. David. 27th April 2013

Win That Contract 2013

Page 2

Table of Contents
Introduction Competitive Advantage 1 Pursuing unsuitable opportunities 2 Lack of innovation and creativity 3 - Failing to differentiate your solutions Relationships 4 Weak relationships with the customer and their evaluators 5 Failing to build trust and rapport 6 Not asking the right questions before the PQQ, ITT or RFP is issued Processes 7 Unstructured business development, capture and bid processes 8 Insufficient planning and preparation PQQ and Bid Teams 9 PQQ and bid teams under resourced 10 Little commitment shown by key contributors 4 7

12

16

19

Understanding 21 11 Not understanding customers needs, standards, expectations, constraints and concerns 12 Misinterpreting the procurement process, instructions, questions, scoring and selection criteria Strategies and Tactics 13 Being outsmarted by competitors 14 Pricing tactics which backfire 15 Late surprises 16 Running with the wrong partners Evidence 17 Performance data is threadbare 18 Aspirational answers 19 Poor references Content and Presentation 20 Demonstrating how your solutions will add value and reduce risk? 21 Features and benefits 22 Poorly written and poorly presented documents Post-tender Interviews 23 Snatching defeat from the jaws of victory Summary 25

28

30

33 35

Win That Contract 2013

Page 3

Introduction
One of the most challenging aspects of running your business is ensuring a steady stream of profitable contracts. The trouble is your competitors are also putting in a lot of effort in finding the best customers and the best projects to bid for. As the economy continues to stagnate, then in mature markets such as construction or IT services, the competition gets even fiercer. It is not uncommon to see over 100 organisations chasing the same opportunity. With so many applicants, customer procurement teams face a daunting task to draw up a short list of bidders who are best qualified to undertake the project or programme. They all want to do this efficiently and as a result the initial emphasis with the pre-qualification process is on the speedy elimination of unsuitable applicants who clearly do not meet the minimum requirements and would introduce too much risk for the customer. This is followed by the difficult task of finding a short list of the best organisations to bid for the contract, those who can manage risk and add value. The difference between success and failure often comes down to just a single percentage point. Over the last ten years it has been noticeable how much more difficult it is to pre-qualify to tender for an opportunity let alone winning the contract. The bar is getting higher and higher. A few years ago scores of just over 70% would normally carry you through to the next stage but today you need to be scoring 90%. If you successfully pre-qualify to bid for a contract then not only do you have to be competitive with your price but you also have to continue to demonstrate how you can maximise value and minimise risk for your customer. Many tenders, particularly for public sector contracts are awarded on the basis of the most economically advantageous tender (MEAT) which means that the customer selects on best value rather than lowest price, although in todays economic climate more weighting is being given to the price. The method for determining value is usually through a requirement for bidders to complete a quality or technical questionnaire or prepare a quality or technical document which is submitted alongside the pricing schedules. These are assessed by customers against pre-determined scoring criteria. If you don't have a proven system for preparing and presenting your answers to the questions posed in the pre-qualification questionnaire (PQQs), invitation to tender (ITTs) or requests for proposal (RFPs) documentation, you could find yourself way down the pecking order and fall at the very first hurdle.

Win That Contract 2013

Page 4

Despite these challenges, there are companies just like yours who consistently win a steady stream of lucrative contracts and long term framework agreements with some of the best customers in their sector. I call these companies the Elite Bidders. So what's the difference between those who struggle to pre-qualify and win tenders and proposals and those who consistently win contracts? And, more importantly, how can you become an Elite Bidder too? That's where I come in. My name is David Harrison and I specialise in helping companies like yours to really punch above their weight and not only sail through pre-qualifications but win both individual contracts and long term framework agreements with target customers. My company has been helping bidders achieve outstanding results in PQQs, ITTs and RFPs for 10 years with a success rate of: 95% for PQQs and 66% for tenders and proposals These are not flash in the pan results; they have been achieved over a full decade, through good times and lean times. Nor are the results qualified to exclude tenders and proposals lost due to factors outside the control of our company such as price. How do we achieve great results consistently? Well, I have worked in the construction industry for 35 years, of which 21 have been at Director Level. I have amassed a huge amount of contacts, knowledge and experience in bidding for work as a contractor and as a consultant, learning what works and what doesnt. Believe me, I have learnt the hard way and picked up some valuable lessons along the way. I also work for end-user customers as a lead consultant, procuring the services of consultants, architects, surveyors, contractors, facilities managers, project managers and specialist contractors. I design and manage the whole procurement process, from advising clients on procurement strategy, advertising the tenders in the Official Journal of the European Union (OJEU), designing and issuing pre-qualification and tender documentation, evaluating submissions from bidders and through to managing tender interviews and negotiation of contracts. Over the years I have seen the very best examples of pre-qualification, tender and proposal submissions and the very worst and have the insider secrets from customer evaluation panels on what it takes to score well with customers and have seen all of the mistakes that bidders make! Win That Contract 2013 Page 5

Not only are we involved with matching up end-user customers and their suppliers but our post tender mobilisation service helps customers and their design and construction teams set up their projects to achieve their objectives using innovative techniques and processes which deliver FASTER, BETTER and CHEAPER results. The combination of knowledge, skills and experience used in both our tender and post tender services gives us a unique insight into exactly what most customers need and what they are looking for when selecting a key design team professional, contractor or supplier to undertake a project or enter into a long term framework agreement. Ive put together this SPECIAL REPORT to give you a comprehensive picture of where I believe organisations are going wrong when completing pre-qualification questionnaires, tenders and proposals. I have grouped the 23 biggest mistakes into similar categories; there are nine of these, each one forming a new chapter. Perhaps you might recognise some of the mistakes and hopefully this will encourage you to take action to avoid these pitfalls when submitting PQQs, tenders and proposals and improve your chances of success. It could make all the difference!

Win That Contract 2013

Page 6

Competitive Advantage
Mistake #1 Pursuing unsuitable opportunities Mistake #2 Lack of innovation and creativity Mistake #3 Failing to differentiate your solutions

Mistake #1 Pursuing unsuitable opportunities If you dont have a competitive advantage then by definition you have a competitive disadvantage and are destined to lose. Some bidders are totally unrealistic and over optimistic when it comes to selecting which contracts to pursue and they have very little chance of winning. If you were a customer would you: Place an order which would double that companys annual turnover? Put your faith in organisations which have all of their resources concentrated in a base which is remote from the project? Take a risk with a supplier which has a weak balance sheet? Select a company that has absolutely no track record for the type of work to be undertaken?

I know you have got to start somewhere if you are trying to break into a new segment of the market but every end-user customer I have worked for doesnt want to take a gamble when appointing contractors, consultants and suppliers and is looking to eliminate as much risk as possible. It is clear when some companies are being unrealistic or too ambitious and they have zero chance of success. As an old boss of mine used to say, You would be better off doing the crossword! I have advised my own clients not to bid for certain contracts because I just know that they will be wasting their valuable time and money, even though some of that money would have been spent on my fee! Time and money are scarce commodities and should be spent wisely on bids where you know youve got a competitive advantage which gives you at least a 33% chance of success. If you have done your homework then the minimum requirements and selection criteria should not come as a surprise when the Pre-Qualification Questionnaire (PQQ), Invitation to Tender (ITT) or Request for Proposal (RFP) arrives and you should already be able to evaluate your chances of success. A good bid-no bid Win That Contract 2013 Page 7

policy will guide you in making the right decisions. If you dont have one then contact me and I will send you an example for you to adapt and use. Dont be too greedy Sometimes, contracts and in particular framework agreements are broken down into lots, usually by geographical area but sometimes by size of contract. As a procurement consultant who evaluates PQQs and bids, it is quite refreshing when a bidder says that they wish to concentrate on only one or two lots because they do not wish to dilute their efforts across too wide an area or take on projects which are inappropriate to their resources, skills and experience. But far too often, bidders put themselves forward for everything in the misconception that customers want a one stop shop every time. All companies are better off concentrating on bidding for work where they are strong. It makes sense, but we live in a world where many want to take a punt at everything in the hope that they get a lucky break. It just doesnt work out that way does it? Addressing weaknesses particularly with your financial stability Customers want to select companies who will remain financially secure over the life time of the project or framework contract and they are looking for reassurance from bidders. In fact, financial stability is a pre-requisite at pre-qualification stage for every contract advertised in OJEU and is usually a gateway that has strict pass or fail criteria. If you fail to fulfill the criteria then you are eliminated and will not pass through the gateway to qualify for the next round. Most pre-qualification questionnaires ask for the last three published accounts. The customers procurement evaluators are looking at liquidity and solvency mainly but also take into account turnover (as a measure of capacity), profitability, and value added per employee, debtor and creditor days. The trouble with published financial accounts is that they are an historic snap shot and you cant do anything about them once they have been published. Some clients will just reject the application if the suppliers financial accounts are weak but others will seek further clarification of the companys latest financial position and may request written support from their bank. If your financial stability and capacity has improved since the publication of your last set of accounts through the collection of debts, an upswing in profitability or the injection of new shareholders funds then it pays to provide this information

Win That Contract 2013

Page 8

in your pre-qualification questionnaire. If necessary create an addendum to the PQQ or submit this information with a covering letter. Mistake #2 Lack of innovation and creativity Many bidders are too pre-occupied with being the lowest price technically acceptable compliant bid. You may be thinking whats wrong with that? Isnt that the best position to be in? Many customers go to great lengths to instruct bidders to submit bids which are compliant with their requirements and they state that you may be risking disqualification if you dont follow these instructions. However, the successful bidders nearly always offer additional alternative solutions which are technically acceptable and represent even better value for money. These alternatives are often at a lower price. If you are not being creative and producing innovative alternative solutions then you are putting yourselves at a serious competitive disadvantage and are probably scratching your head trying to work out how you lost the contract and how on earth a competitor could be so cheap. Well the answer is you are not comparing like for like and although their price is much lower, so too are their costs and they probably have a better margin built into their bid than yours! Most tender and proposal submissions that I have evaluated lack any sort of innovation and creativity and are virtually identical to their competitors. In this economy the same old solutions just dont cut it anymore and you need to be more creative. Elite Bidders offer the customer alternative ways of achieving their objectives with faster, cheaper, better solutions. This requires a few things: A deep understanding of: the customer, the project opportunity and if possible your competitors likely solutions. Note that it is nearly always too late to obtain this crucial intelligence when the PQQ, ITT or RFP is issued so start early! Processes which encourage innovation and creativity and lead to the development of win strategies and themes which are relevant, beneficial and attractive to customers. An organizational culture which embraces transformational change and focuses on continuous performance improvement to develop solutions which are faster, cheaper, better and less risky than your competitors and gives you a competitive advantage. Remember in todays economy everyone wants more for less! Page 9

Win That Contract 2013

When evaluating PQQs, customers are looking for the easiest and quickest way to eliminate applicants so that they can reduce the long list of potential bidders down to a short list. The emphasis is on looking for anything that may present a future risk to the success of the project. However, when it comes to the next stage, the winning bidder is normally the one that can demonstrate more value added than the other bidders. It is a switch of emphasis and requires creativity not just in developing the solutions but also in the content, writing and presentation of the tender or proposal. If you want to differentiate your bid and add more value then you have to be creative and you need to innovate. This is even more important for framework agreements which run over a number of years where the customer is relying on the successful bidder to constantly improve and deliver more value. They are under pressure to deliver better value for money and in this economy you cant stand still for too long. Some companies need help but if you are one of those then you will be pleased to know that there are proven techniques which work which can be learnt. Mistake #3 Failing to differentiate your solutions When I first talk to potential clients who want to pre-qualify or bid for contracts, I ask them where they think they have a competitive advantage and the majority either dont know because they have never really given it much thought before or they say that they are pretty much the same as everyone else but hope that they are a little bit better. It will comes as no surprise then that they have only one win strategy in mind when bidding for contracts: to be the lowest price compliant bid. There is no real attempt to differentiate themselves and their solutions. If you are struggling to think of where you can differentiate your company and its services, products and solutions then you may be interested in my next free guide titled 100 Sources of Competitive Advantage which will be published in May 2013. When I start probing I find that every company has a few gems which they take for granted. Being too modest is a very British characteristic but it doesnt help you win contracts. Achievements are played down and in most cases companies have simply not bothered to measure and capture all of the benefits delivered to their clients yet this is a rich source of material to use in marketing, business development and bid management.

Win That Contract 2013

Page 10

One unique source of differentiation is your people. They are totally unique with a very specific set of personal attributes, values, beliefs, skills, knowledge and experience. No-one can copy your people and your team. One of the biggest mistakes that bidders make is a failure to make the skills, knowledge and experience of their people a central theme in differentiating their tender from everyone else. Customers want to know who they are going to be working with, yet you would be amazed at how difficult it is to establish exactly the names and track record of the front line team who would run the contract if successful. When I see an organisation chart with only the directors on it and a set of CVs for only head office staff then it makes me think that they dont have the right people available for the contract. Needless to say, these companies pick up few marks for a section that should be low hanging fruit for most. The best companies stand out a mile and actually create a unique selling point out of the strengths of their team, particularly their front line customer facing staff. They provide not just names but pictures, testimonials from delighted customers and CVs tailored to highlight the relevance of their skills, knowledge and experience for the type of work required by the customer. Senior management and specialist staff are also included on the organisation charts but they are demonstrably there to support the front line staff with resources, advice, information and decisions.

Win That Contract 2013

Page 11

Relationships
Mistake #4 Weak relationships with the customer and their evaluators Mistake #5 Failing to build trust and rapport Mistake #6 Not asking the right questions before the PQQ, ITT or RFP is issued

Mistake #4 Weak relationships with the customer and their evaluators Twenty years ago, when I had just taken up my first position as a director of a contracting business, I was given a very good piece of advice from an experienced colleague. He said, Its not what you know and its not who you know that counts in business, its what you know about who you know that really makes the difference! He explained that you are better off having a smaller number of deeper more meaningful business relationships than a large number of shallow acquaintances who you see rarely and know hardly anything about. He advised that you should try to develop true business friendships based on mutual understanding, trust and a commitment to help each other succeed. I can testify that this has worked not just in business but in my private life too. Human nature dictates that most of us have a preference for spending time with people who we like and trust. In the private sector, customers often decide who they want to place a contract with before the tender is issued and usually find a way to achieve this even if their favourite supplier isnt the lowest price to start with. In the public sector, such bias is not allowed and evaluators have to be as demonstrably objective and fair as possible. Nevertheless, in my opinion, I believe that there is still some influence even if only at a subconscious level. So my message is to target customers where you have a great relationship as this gives you a huge competitive advantage particularly in the private sector. If you dont have a close relationship yet with an important potential customer then start getting to know them straight away and certainly well before the PQQ, ITT or RFP is released as it will be too late then. There are other good reasons for early interaction with customers which I will explain later. Mistake #5 Failing to build trust and rapport From what I have seen, less than 5% of companies submitting PQQs just dont bother to build rapport with the customers evaluators and less than 40% of bidders dont pay much attention to this either. This presents an opportunity for others. Most customers in the public sector are faced with a dilemma. Win That Contract 2013 Page 12

They are highly sensitive to any claims that they have been biased or have treated anyone unfairly and as a result it is often difficult to speak to them once a PQQ, ITT or FRP has been issued. On the other hand they also want to make sure that all applicants and bidders fully understand their requirements. The compromise they usually adopt is to stipulate that all bidder questions will be recorded in writing and are preferably raised by email and that all answers will be circulated to every bidder unless it is agreed that the subject matter is commercially sensitive to the bidder raising the question. This arms length approach underlines the importance of getting to know the customer before PQQ, ITT or RFP release. It isnt impossible to build trust and rapport with a customer through written communication and one should still try but it isnt the same as face to face communication. Fortunately there are still two or three opportunities to meet the customer and their representatives which should not be ignored. These include pre-tender open days, mid-tender interviews and site visits. Not taking up these invitations is foolish as it sends wrong message and is a missed opportunity to gather intelligence and build relationships. I know that time is limited and it is difficult to prioritise tasks but even if you dont think that you need to visit site to assess the work content then think again. Its not just about checking the scope of work even though that is really important. It is also about sending a message to the customer that you are interested and enthusiastic about their project or framework. This is what most customers are looking for. You also miss the opportunity to build rapport and gain a better understanding of the customer which could give you an edge over your competitors. You may also find out who your competitors are as customers like to minimise disruption and take all bidders around site at the same time. Not building trust If you dont already have an excellent relationship with the customer then how do you go about building one? Well, the foundation of all good relationships is trust. It is that precious and fragile ingredient that takes a long time to build but can be shattered in seconds and needs to be nurtured carefully. Trust is also the main building block for partnering and collaborative working. If you are targeting a framework contract then if you cannot demonstrate that you Win That Contract 2013 Page 13

can work collaboratively and develop a mutually beneficial long term relationship then you have little chance of success. Partnering has been around for many years but most companies and people are rubbish at it! I believe this is true for most customers, design teams, contractors and suppliers. The problems arise from a fundamental lack of understanding, commitment, behaviours, skills, processes and tools to make it work. Proper partnering is not cushy or complacent, it is demanding and challenging, but in my humble opinion it usually delivers more value and reduces risk for all parties concerned. Is partnering and collaborative working dead? For some it is but fortunately for others it is still alive and kicking. Customers who select their contractors, consultants and suppliers based purely on price are not looking to adopt a partnering approach. Those customers who are looking to select on best value or the most economically advantageous bid (which incidentally is the preferred approach of Government and public sector customers) and require bidders to submit a quality submission is a signal that they are very interested in how the bidders propose to add value and manage risk and partnering plays an important role in this. What I have noticed is that the companies who score highest on their quality submissions also have a good grasp of partnering and have processes in place to help them. They can also provide examples which demonstrate their commitment to make it work. I use a simple but comprehensive and effective system for helping my own clients introduce partnering to their projects, frameworks and business. It produces results consistently and also creates great content to use in PQQs, ITTs and RFPs. Mistake #6 Not asking the right questions before the PQQ, ITT or RFP is issued How much do those responsible for business development and capture know about the contracts they are pursuing? Not enough is the answer in the vast majority of cases. Thats not being disrespectful to those who are working really hard to generate leads and bid opportunities, it is just that many fall into the trap of going for quantity rather than quality. I know because I have made that mistake too. You are under pressure to justify your position and are paranoid about keeping the estimating, pricing or Win That Contract 2013 Page 14

quotations team fed with a continuous flow of bids. The biggest fear for a business development manager is to have a team of estimators sat in the office doing the filing! Mind you, that is what they would be better off doing rather than bidding for contracts they cant win or cant make a profit on. So business development managers are paranoid about generating quantity and for many the longer the list of bids the better as no one can say that you arent doing your job.or can they? My advice is not to be a busy fool. Hold your nerve. Be more selective. Reduce the number of contracts you are pursuing and spend more time and effort on those so that you can dig deeper. If you have better intelligence than your competitors and an earlier and better understanding of the customers needs then you have more time to develop innovative, creative and effective win strategies and it will improve your success rates.

Win That Contract 2013

Page 15

Processes
Mistake #7 Unstructured business development, capture and bid processes Mistake #8 Insufficient planning and preparation

Mistake #7 Unstructured business development, capture and bid processes It is a mistake if you dont have or are not following a structured process for identifying, qualifying and capturing opportunities to bid for contracts. A scatter-gun approach is ineffective and wasteful. You need to be really focused and realistic so that you invest your time and money on the opportunities where you have the best chance of winning and making a profit! In Mistake #6, I recommended that business development managers should be selective and start working on opportunities which will generate the best results as early as possible. There is a lot of work to be done to build relationships and position your organization with the customer and to gather vital information about the customer, the opportunity, the procurement process and where possible the likely competition. All of this information has three uses: It will help you to make good decisions on whether to commit further resource to continue pursuing the opportunity or switch to others which are more attractive. It will potentially provide you with a competitive advantage over your competitors. It will allow time for you to develop innovative win strategies.

Elite Bidders have bid-no bid procedures, their win strategies are in place well before the bid arrives on their desks, they have built great relationships with the client and their advisors and they have thought carefully about what it will take to win a contract. They also plan the writing and production of their bid submissions thoroughly. I have attended kick-off meetings for PQQs, tenders and proposals and noticed the following mistakes being made: Win That Contract 2013 Page 16

Not enough time is allocated for the meeting; limiting it to a very quick allocation of tasks and little more. Participants are not available or not well enough prepared. Win strategies and win themes are not fully explored and often not even discussed. The team is not looking at the PQQ, ITT or RFP from the customers perspective and is not spending the time to determine what it will take to score maximum points for each question or section. A content plan has not been prepared to guide bid writers and authors. A validation and review process is not discussed in detail. Usually just a date is agreed for the final review.

The consequences of these mistakes is that those who have been allocated the responsibility of writing answers to questions asked in the PQQ, ITT or RFP or writing about the solutions proposed to meet customers requirements have nothing to guide them and there is nothing in place to determine whether they will achieve maximum scores for what they have written. In these circumstances writers are left to their own devices and find it difficult to know what to write about and will waste time in the early stages trying to figure it out for themselves. This can put deadlines in jeopardy and adversely affect the quality of what has been written. This is exacerbated where there are multiple bid writers and the quality of writing and content may be very patchy indeed. If the review meeting takes place only a couple of days before submission then there may be a lot of rewriting to do. This means that someone has to work through the night to rewrite the document and final printing and assembly is done at the very last minute and that is when errors occur. Mistake #8 Insufficient planning and preparation When I was at school I was late for an English lesson. As a punishment the teacher made me write an essay with the title Time waits for no man. As punishments go, this was one of the least painful, but the most effective in terms of shaping my future attitude. When evaluating PQQs there is always one organisation who tries to submit their PQQ after the deadline. The person responsible claims to have seen the advert after everyone else, or is the victim of exceptional circumstances. Do you know anyone like this? Win That Contract 2013 Page 17

They are the ones who leave it to the last minute, who always blame others for their lateness and are always asking for an extension of time. Some will even resort to manipulating the truth and blaming the post or the customer for losing their submission! What does this say about the person and the company? Enough said. The answer of course is to treat every PQQ, ITT or RFP as a mini-project. Start early, plan well; allow sufficient time for writing, editing, reviewing, rewriting, polishing and assembly of documents. Allocate tasks to those who have the capacity, knowledge, experience, skills and commitment to do the job well. Like projects, producing PQQs, tenders and proposals is a team effort and requires a bid manager with good leadership and project management skills.

Win That Contract 2013

Page 18

PQQ and Bid Teams

Mistake #9 PQQ and bid teams under resourced Mistake #10 Little commitment shown by key contributors

Mistake #9 PQQ and bid teams under resourced Hands up if you have objectively assessed how long it will take to create a winning PQQ, tender or proposal submission and then either you or your boss has halved it! Maybe you have been told that you can only spend so much time or money. Is it because you are juggling other jobs or because the boss is more concerned with cost than quality? What tends to happen when you have time and money constraints is any or all of the following: Short cuts are taken and you resort to cutting and pasting from previous submissions more than you would like to. You miss out the crucial planning, strategy and review steps. You extend your working day and week. If this happens regularly then you will end up exhausted and make mistakes. The review of your work is done at the last minute leaving little time for any amendments. Your success rate suffers unsurprisingly.

I am not advocating spending more money overall. I am just saying that you should be more selective and spend more time and effort on fewer opportunities and get better results. It is better to spend twice as much on doing the job properly and winning two out of three tenders than trying to take short cuts and ending up winning one in six. Mistake #10 Little commitment shown by key contributors Engineers and surveyors make up 90% of the construction, built environment and IT sectors that I cover. I would suggest that none of them selected their careers and joined their professions because they enjoy writing! Most of them hate it, which is just as well as I would be out of a job! People generally prefer to use their time doing things they enjoy which is why problems occur when you allocate writing task to subject matter experts who dont like writing. Win That Contract 2013 Page 19

I have found on numerous occasions that despite continued promises that they will complete their writing tasks on time, the work is either late or has been rushed and is therefore of poor quality and has to be completely rewritten. Occasionally the work doesnt arrive at all! There are 101 reasons why it was not their fault, the most popular being that they had to deal with an urgent request from a customer. Some of these excuses are genuine, but when you analyse it, it is usually the same people making the excuses. They dont want to complete the tasks allocated to them because they hate doing it. The answer is to create a team of subject matter experts and writers where the writer interviews the subject matter expert and extracts all of the rich and relevant content for the submission and then uses their writing skills to create a submission which articulates the strengths of the organisation and the benefits of the proposed solutions. It is rare to find a bid writer who has the subject matter expertise and content knowledge to produce top class submissions on their own. So it is essential that they have excellent communication skills and are able to ask the right questions, actively listen to answers from subject matter experts and then use this information properly.

Win That Contract 2013

Page 20

Understanding
Mistake #11 Not understanding customers needs, standards, expectations, constraints and concerns Mistake #12 Misinterpreting the procurement process, instructions, questions, scoring and selection criteria

Mistake #11 Not understanding customers needs, standards, expectations, constraints and concerns Every customer is different and more often than not there are several stakeholders who will all be affected by the project(s) and can have a big influence on the selection process. They all have their own values and beliefs, their own principles and preferences, their own needs and wants; some may have strict policies or very specific requirements. Many projects have awkward constraints where difficult trade off decisions have been made to enable the project to proceed. I have seen some tenders where all of the above is captured and communicated clearly to bidders in the documentation provided. In others, it is a little more difficult to tune in to exactly what the customers want and need, what they are trying to achieve with the project and what they are most worried about. Irrespective of this there is usually a wide gap between those bidders who understand what the customer wants and those who dont have a clue and are often baffled by the low scores they receive from evaluators when they submit generic, irrelevant answers to questions raised. Finding out what each customer really wants should not be left to chance. Earlier in this report I have discussed the mistake many make in not spending enough time gathering vital intelligence about the customer and the opportunity before the procurement exercise starts. When you have this information it allows you to develop answers which address all of their concerns and solutions which add real value at an affordable price. Mistake #12 Misinterpreting the procurement process, instructions, questions, scoring and selection criteria One of the more obvious mistakes that bidders make is failing to ensure that they really understand the questions. Some questions, requirements or instructions prepared by customers are ambiguous. If in any doubt, ask a colleague or a consultant for their interpretation or seek clarification from the customer. If you misinterpret just one question or requirement it could eliminate you from the competition. Win That Contract 2013 Page 21

When helping my clients to win contracts, I often have a different interpretation on what each question means and what will pick up maximum scores. I like to think that it is because I work on both sides of the fence and have a unique insight into what end-user customers are looking for. This undoubtedly helps but more significant is the fact that by combining my ideas with those of my clients own team we jointly arrive at the right interpretation. I think that in most cases bidders know when they are struggling to grasp what the customer is looking for. However, rather than seeking help or clarification, they plough on regardless. The results can lead to answers which are too short and lack substance or are too long and full of waffle. Neither demonstrates understanding. In some extreme cases, bidders have simply provided no answer at all or have even cut and pasted an answer from another pre-qualification questionnaire or tender in the hope that some of it may pick up some points! The funniest answer I have seen was from an architect who didnt understand a question about equal opportunities and diversity and rather than seek clarification he simply answered Well, youve got me there! At least he was honest and proved that he had a good sense of humour but needless to say he didnt pick up any points for that particular question. I have seen some fairly ambiguous and nebulous questions being asked by customers which make it difficult for bidders to answer. In these situations it is important to contact the customer to establish exactly what they mean. The customer should then distribute their answer to all bidders to ensure a level playing field for all. If you dont do this then it could become a bit of a lottery with some bidders on the same wavelength as the customer and some not. Make sure you dont fall into the latter category and remember...if in doubt...ask for help! There is information missing from the submission I know they have asked for it but lets hope that they dont realise its not provided! Wrong! If information has been requested then there is probably a very good chance that marks will be awarded for the information. Failure to produce the information will result in the dreaded nil points! Omissions raise question marks about the suitability of the bidder.

Win That Contract 2013

Page 22

The most common omissions are: Financial accounts (they must be weak?) Organisation charts and CVs (they dont have the right people available?) Evidence of experience or performance (they havent actually got anything worth submitting?)

Its not rocket science is it? Why havent they followed the instructions? The classic mistake made is to ignore what has been specifically asked for or provide a slight variation or your own version of what you really think the customer wants. In my experience, 40% of submissions are guilty of making too many assumptions. Bidders often: Provide no answer at all to a question and forfeit any chance of a mark. Ignore the word limits applied to some questions and waffle on forever making the job of the evaluator even more time consuming which doesnt endear them to a time pressed evaluator and can incur penalty points. Use a font size 8 so they can cram more information into a page when there is a limit on how many pages you can use for an answer. o This is great if the assessor has brilliant eyesight and only has one submission to read that day (or night!)

Do not complete the pricing document accurately. o When a pricing document has been put together the customer wants to compare like for like. I know that this doesnt suit each companys method of estimating or pricing and the temptation is to do it your way but this could mean that the customer will have to make assumptions and may make adjustments and allowances where they think appropriate. This is rarely to the advantage of the bidder who hasnt followed the instructions.

Misunderstanding of the customers selection criteria and scoring mechanism Many efforts by bidders are misplaced because they fail to really understand where they can pick up the marks when completing a quality submission. There is plenty of low hanging fruit that goes begging. You just wouldnt believe how many companies miss easy points on questions in the quality sections. Win That Contract 2013 Page 23

On the other hand, I know of many companies who have submitted a great quality submission packed with benefits and added value only to totally misread the importance of the trade off between quality and cost. This is where it pays to know the customers priorities and objectives. How many times have you put forward a fantastic team and a comprehensive approach to the project and then lost the contract because your people costs or preliminaries and project management allowances are too high? Its an art to get this balance right isnt it? Misunderstanding of the procurement process Some companies that I have come across do not understand the procurement process being followed nor the procurement rules and regulations which drive the procurement approach. Some of the less experienced companies are just not aware of what it will take to pre-qualify for tender short lists and make assumptions which land a fatal blow to their bid. The most common mistake from experienced companies is complacency or over confidence. They make the assumption that the threshold score for the quality submission at pre-qualification stage is set much lower than it is and that they will easily qualify for the next stage and be asked to submit a tender. This is particularly true of incumbent suppliers who may have worked on a framework contract with the customer over the last four years. The standard of PQQ submissions is rising every year and what was good enough to qualify four years ago is just not good enough today. Their blas approach is reflected in their submission which is usually lacking in both quality and quantity and does not pick up enough marks. I have had some bidders come back and ask if they can have a second chance and resubmit their submission. They find it difficult to accept that theyve blown it and fail to appreciate or understand that with public sector procurement the scoring criteria and evaluation has to be transparent, fair and objective and no one is given more favourable treatment. If you are in doubt, then ask for help.

Win That Contract 2013

Page 24

Strategies and Tactics

Mistake #13 Being outsmarted by competitors Mistake #14 Pricing tactics which backfire Mistake #15 Late surprises Mistake #16 Running with the wrong partners

Mistake #13 Being outsmarted by competitors Failure to notice loopholes and flaws in the customers selection process or documentation could work to your disadvantage. I have a sad story to tell which I picked up when conducting a post tender critique of an unsuccessful bid prepared by a contractor. They did everything right and submitted the best quality submission and a very competitive price but because of the way that the customers scoring system worked it meant that they came second overall to what I would call a very crafty piece of opportunism from a competitor. The quality section was worth 60% of the total score and the pricing section was worth 40%. The flaw was in the pricing section as the customer bizarrely only required the bidders to price the on-site overheads (preliminaries). This created an opportunity to gain a disproportionate advantage by submitting a very low price for an element of the contract that would make up less than 10% of the overall costs and would not really affect their profitability that much as there would be plenty of opportunity for them to legitimately build the missing costs into the labour rates or the general overheads when pricing the work after appointment! The customer admitted afterwards that they didnt notice the flaw until it was too late and their hands were tied. They placed the contract with the wrong company and lived to regret it afterwards. If one of the bidders had noticed the flaw and brought it to the attention of the customer at tender stage then they could have issued an amendment or correction to all bidders to ensure a level playing field. The alternative of course was to do what the winning bidder did and submit a tactically low price and keep quiet hoping that none of the other bidders notice the unfair advantage that could be gained! However, if you are in the business of retaining customers and developing long term relationships then you might want to think carefully before you employ this tactic. Win That Contract 2013 Page 25

Part of the problem is not taking time to collect and analyse intelligence about your competitors to forecast their likely tactics and taking action to offset any advantage that they may gain from these tactics. Look at the project through your competitors eyes: what would you do in their position? How can you counter their approach? Outsmarting your competitors The key to winning profitable contracts is innovation and creativity. The best deal for a customer is the one which adds the most value and produces the least risk relative to the price. The factors that create value and reduce risk are different for each customer and each project so your solutions need to be tailored each time. You can only come up with innovative tailored solutions which are relevant and attractive to customers if you really understand their needs, constraints and objectives. If you know more than your competitors and use that information advantage early enough you will have a significant advantage over your competitors and it will be their turn to scratch their heads and wonder what you did to win the contract. Mistake #14 Pricing tactics which backfire Using a non-compliant low price tactic to get a foot in the door can backfire if the bid is heavily qualified and the solution is technically unacceptable. It depends on the customer, but some will actually penalise bidders who put in a technically unacceptable low price hoping to talk it up at a later stage. Others may still want to discuss your bid so you have to pick the right customer to use this tactic with. Some customers have strict procedures for dealing with this situation and you will be faced with the choice of standing by your price and confirming total compliance with the customers requirements or withdrawing. Neither may be a satisfactory conclusion to all of the efforts you put into the tender so you have to weigh up the risks. As an ex-contractor I do accept that you need to explore all avenues to use a tactic or approach which gives you an advantage. You want to push it to the limit without risk of being penalised. My proven contract winning system has been developed using many years experience of what works and what doesnt work. The trick is selecting the right tactic for the right situation. Win That Contract 2013 Page 26

Mistake #15 Late surprises I have seen bidders snatch defeat from the jaws of victory by introducing a late surprise. For example, in the negotiation stage, after the bid has been submitted, they: Switch the proposed project team. Try to change the price or conditions of contract. Introduce a JV partner or switch key partners. Reduce quality. Ask for a later start and a longer period to complete the works. Declare that they are now going to sub-contract out a significant part of the work. Pass significant risks back to client.

Customers dont like surprises, especially when they have already evaluated the promises and proposals made earlier and have probably eliminated other companies who scored just slightly lower. You could easily find yourself disqualified or reassessed and eliminated through a lower score. Is it worth the risk? When you think about it, how can the customer trust you again? Wont they think that you tried to mislead them or will they think that it is just part of the game that all bidders play? It depends on the customer. Mistake #16 Running with the wrong partners If one member of your team is much weaker, it dilutes your strengths and introduces risk for the customer. If you are not a good match for your partners it shows up clearly and creates doubt in your teams ability to perform. Ideally you want partners who are the best at what they do, who have the capacity to deliver, have relevant experience and competences, are capable of creating competitive and attractive solutions, can work collaboratively for mutual benefit and preferably have a successful track record of working with you and the customer before. It doesnt go down too well with customers if you switch partners after the tender has been submitted and evaluated.

Win That Contract 2013

Page 27

Evidence
Mistake #17 Performance data is threadbare Mistake #18 Aspirational answers Mistake #19 Poor references

Mistake #17 Performance data is threadbare Have you ever received low scores for the performance management section of pre-qualifications and tenders? Have you wondered why this is? If this has happened to you then you already know the answer, I hope. You cant pick up many marks if youve got very little (or nothing) to show the customer. In my experience I would say that 8 out of 10 bidders have poor records when it comes to measuring and capturing performance data and 3 out of 10 have none at all. Most bidders submit: no data at all, just the little bits of data they have, or they try to bulls**t their way through this section. Needless to say, they absolutely bomb on this aspect of their submission. It can often make the difference between overall success and failure. Designing and implementing a simple, easy to use performance management system that generates a gold mine of useful data which you can use in your tenders is a relatively straight forward process and guess what?....it improves your performance and profitability as well! Despite this, so few organisations have one. Mistake #18 Aspirational answers I often see submissions which are well constructed and in tune with what the customers are looking for but despite this the bidder cant back their answers up with evidence of actual achievement. The answers therefore come across as aspirational. They give the impression that this is what they would like to do rather than what they have actually done.

Win That Contract 2013

Page 28

Customers evaluators are looking to award marks for both understanding and evidence with an emphasis on the latter as they want to see proof and it adds credibility to your bid. You might say We havent got the material or the evidence! From my experience of helping companies win contracts, I quite often hear this but more often than not the evidence does exist. It is just a case of asking the right questions and looking in the right places to find the little gems of information and data that will pick up the marks. I have created a comprehensive set of questions for the more common types of questions asked and use these to help my clients realise that they do in fact have some great material. They just need to implement a process for systematically capturing useful material or data on every project and building up a library of well written case studies that can be used on PQQs, tenders and proposals. Another common mistake that organisations make is to use evidence of achievements from projects which are not relevant to the type of work required by the customer. A fantastic case study for a new factory is not really that relevant for the refurbishment of an occupied housing estate is it? Mistake #19 Poor references Virtually all customers ask for references from previous customers, usually three. They carry a significant proportion of the total scores so there is a reasonable expectation that you will provide the contact details of referees who fulfil the following criteria: They are happy with the services and products that you provided for them They purchased your services and products recently (i.e. within the last three years) Their projects were of a similar character and size to that required by the customer and are therefore relevant to the bid The referees have already given permission to be approached

If any of these criteria are not met then it may be better not to include them at all as they may be a liability! I have sometimes been amazed at the choice of referees made by some bidders as the reference is so poor. If you have little alternative, then it may be better to use someone who will give you a good reference even though the projects you have completed for them have little in common with the project you are bidding for. If in doubt seek a second opinion. Win That Contract 2013 Page 29

Content and Presentation

Mistake #20 Demonstrating how your solutions will add value and reduce risk Mistake #21 Features and benefits Mistake #22 Poorly written and poorly presented documents

Mistake #20 Demonstrating how your solutions will add value and reduce risk? Customers are interested in how you will add value and reduce risk relative to the price. It is therefore a mistake if the things that are most interesting and beneficial to them are buried in your PQQs, tenders and proposals making it difficult for the customers evaluators to find them and award marks. The purpose of a pre-qualification process is to reduce a long list of interested applicants down to a short list of suitably qualified bidders by eliminating those who present the highest risks of not achieving the project objectives. Therefore the emphasis is on risk reduction and your content needs to reflect this. However, when it comes to the next stage, the contract is normally awarded to the bidder who can demonstrate the greatest value for the customer. So think about where your solutions create value. Dont hide this content in amongst lots of detail, make it stand out. Make it easy for the evaluators to understand the value added and award top marks. If necessary spell it out and quantify the value created for the customer. A poorly presented submission will lose you marks but the quality of the content of the material used in your submission is what picks up marks. So get this right! Mistake #21 Features and benefits It is a mistake to only write about the features of your services and solutions. They are important for the customer to understand what you are going to deliver but they are more interesting, meaningful and powerful if they are linked to benefits and outcomes that are highly relevant to the customer. This is critically important when writing bids and proposals because evaluators will award higher marks for benefits and outcomes rather than features and inputs. One area where I find this more apparent is in case studies. Most case studies which I have read are boring because they just contain an unimaginative

Win That Contract 2013

Page 30

photograph, some facts about value, start and finish dates, names of customers and their advisors and a list of services provided. There is no attempt to capture the attention of the reader with a description of what constraints and risks were managed, how creative solutions were found to resolve problems and more importantly how benefits and value were delivered for the customer. There is also no attempt to articulate this valuable information in the form of customer testimonials which are very persuasive. Mistake #22 Poorly written and poorly presented documents Some submissions are an absolute joy to read and are easy to assess as the information is set out so clearly and is instantly accessible. Others, however, are a nightmare and my heart sinks when I see them because I know that they are going to take four or five times longer to read and assess than the best. When you are an evaluator and you have only 3 to 4 days to go through over 100 pre-qualification submissions then it can be irritating to say the least when applicants make it tough for you. Whilst I try to be totally professional and assess each submission on its merits, I am sure that at a subconscious level I am possibly a fraction harder on the poorly presented submissions. It is not my intention to go into detail in this report about how to improve the quality of your bid writing as there is more to this subject than most people realise. All I will say is that it does make a difference and I would urge you to get some training and help if you need it or ask someone to edit what you have written. Failing to clearly state the reasons why the customer should select you Some bidders get so close to the process of answering the questions and providing information requested that they forget that they are trying to persuade the customer to choose them in preference to their competitors. As a consequence, their presentations come across as very stuffy and formal and do not press the emotional buy buttons that we all have when choosing which service or product to buy. People make decisions using their emotions first and then try to justify these by finding the logic to back it up. If you only rely on appealing to a logical analysis of your bid then you may not position yourself at the front of the queue!

Win That Contract 2013

Page 31

There is a real skill in the subtle art of persuasion using both written and spoken words and one that the most successful bidders have cracked. Happily, you too can develop these skills. Presentation of documents The way you present your bid documents says a lot about your organisation and can certainly affect the customers perception about your professionalism and enthusiasm for winning the contract. Elite Bidders put a lot of effort into creating interesting and attractive documents which really stand out. This takes experience, creativity, time and a little bit of investment but it is worth it. Seeing what they produce is a real eye opener.

Win That Contract 2013

Page 32

Post-tender Interviews
Mistake #23 Snatching defeat from the jaws of victory

Mistake #23 Snatching defeat from the jaws of victory It is a mistake to underestimate the importance of the tender interview and oral presentation. In my own experience as a procurement consultant running the interview process, I have learnt one thing and that is to expect a huge gap in the performance of bidders at the interview. You just cannot predict the quality of a presentation or how well a bid team will handle a question and answer session. I have had high expectations for some companies based on the quality of their written submissions but have been really disappointed at how badly they have come across at the interview. I know nerves can play a part but as an experienced interviewer I can usually put the bid team at ease and give them every chance to show their best if they are well enough prepared. These are all examples that I have seen of the things that bidders just shouldnt do, such as: Turning up at the wrong office Arriving late Bringing people who dont speak Trying to take over the chair of the interview Waffling and Bulls**ting Leaving key people behind Bringing the wrong people Dressing inappropriately Disregarding instructions Page 33

Win That Contract 2013

Over-running their time slot Death by power-point

At times, my colleagues on evaluation panels and I have been delighted and surprised at how well some companies have performed at the interview and you are left with a strong feeling that you really want to work with these people, not just because you like them but also because you are impressed with their capabilities and how well they understand the customers needs. There are things that bidders should do to give themselves the best possible chance of success. This is an area that I advise and coach bidders on but is a huge subject in its own right so I wont go into detail in this report. What is important is that you prepare properly, practice, be clear on the messages you want to put across and create a favourable first impression.

Win That Contract 2013

Page 34

Summary
What are the causes? What can you do? The Elite Bidders System

What are the causes? There are many factors that cause bidders to make mistakes. This is not an exhaustive list but includes most of the more common causes: 1. Ineffective business development, capture and bidding system. 2. No bid-no bid process. 3. Not being selective and investing enough time in gathering vital intelligence. 4. Busy fools. 5. Lack of preparation and planning. 6. Poor win strategies. 7. Under resourcing. 8. Poor teamwork and commitment. 9. Lack of ideas, innovation and creativity (same old, same old). 10.Not knowing what excellent looks like. 11.Ineffective review process. 12.Inexperience and misunderstanding. 13.Poor writing, presentation and interview skills. 14.Insufficient evidence.

Win That Contract 2013

Page 35

What can you do? So what can you do to improve your chances of success? Again this is not an exhaustive list but if you take these actions you will definitely get better results: 1. Cut out the mistakes. 2. Improve knowledge and obtain training to develop understanding and skills. 3. Obtain guidance and advice to create a clear understanding of how you can improve your performance and create competitive advantage and then take whatever action is necessary to ensure that you are match fit for future opportunities. 4. Improve your business development, capture and bidding system. 5. Focus on realistic targets: ones you have a great chance of winning. 6. Gather intelligence on your customer, their procurement process, the project opportunity and your competitors. 7. Get closer to your customers and position your organisation favourably before the tender is issued. 8. Plan your win strategies, tactics and approach preferably before the invitation to tender or request for proposal arrives. Ask for a second opinion to make sure you have not missed any opportunities to gain an advantage. 9. Obtain a second opinion on the interpretation of the customers requirements, instructions and questions as soon as the tender arrives. 10.Create a tender outline and content plan which includes instructions to the bid team on everything you need to score maximum scores for each section or question. 11.Review and validate your content plan before you start writing. 12.Hire in expertise to write and/or manage your bids if you do not possess the right skills and experience. 13.Get someone to provide an independent critique of your draft submissions in good time before you submit your bid. 14.Invest time and money to get the presentation of your bid documentation right and plan for this from day one!

Win That Contract 2013

Page 36

The Elite Bidders System Preparing pre-qualification questionnaires, tenders and proposal can be very expensive and make up a large proportion of your overhead expenditure. So please....promise me....dont pour good money down the drain. You just need a simple repeatable process to follow to dramatically improve your conversion rates and chances of success. Suppose there was a system that takes every scrap of guesswork out of the process. An easy to follow and proven system that allows you to: Write better quality submissions and faster Create more powerful presentations Multiply your conversion rates at pre-qualification and tender stages Know exactly what to say for each question Completely stand out in your market Create a trusting relationship with your prospective customers Grow your business significantly And much more

Well, I believe that we have this system in place already. We call it our Elite Bidders System. It has been road tested and improved to deliver spectacular results consistently, year after year. Over a ten year period our success rates are 95% for PQQs and 66% for tenders and proposals. To date we have only offered the system as part of our bid management and business development services to a very select number of private clients but have decided that the time is now right to introduce it to a slightly wider number of clients as long as there are no conflicts of interest with our existing clients. We have a maximum number of clients in mind as we dont want to dilute our efforts by taking on too many. We are also conscious that by restricting the numbers to an exclusive group it makes it more valuable to the members of that group. If you want to be one of the first to gain full access to our system then book a place on either our One-to-One Coaching and Mentoring Programme or our Mastermind Group, details of which can be found in the training section of our website www.winthatcontract.com.

Win That Contract 2013

Page 37

Both of these programmes will take delegates through every step of the Elite Bidders System and reveal the insider secrets from customer procurement and evaluation teams. Alternatively, for a less detailed insight into this system then book a place on one of the training courses to be held in London. You will receive a four page overview and action plan for the system. We are expecting the training courses, mentoring programme and mastermind group to sell out very quickly and places will be offered on a first come first serve basis. You will be sent details of the courses and programmes by email very shortly and can also find them in the training section on www.winthatcontract.com Until then, I genuinely hope that you have found the contents of this special report of value and if you have then I would be really grateful if you would do two favours for me in return... 1. Send an email to david@winthatcontract.com to tell me the biggest challenges or obstacles that you are facing when bidding for contracts and give me some feedback on what you thought of the report and how you will use the ideas presented. 2. Recommend the report to colleagues and connections by email or on your social media networks by sending them a link to the download page on our website so that they can sign up for their copy too. The link is www.winthatcontract.com/23biggestmistakesthatbiddersmake Thank you so much in anticipation and I look forward to speaking to you soon. Best wishes.

David Harrison www.winthatcontract.com

Win That Contract 2013

Page 38