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Proposal Strategy – Growing Your Business
By Will Lindquist
Every day you offer solicitations for business, such as “I’d like a burger and fries,” and in response receive proposals like, “Would you like to super-size that for a dollar more?” Or you might put out an enormous government solicitation, like the bid for the Space Station that filled several notebooks, and receive proposals like one major competitor sent: It barely fit into the 18-wheeler that hauled it to Washington, DC!
In business, we all offer solicitations for business in various ways, and almost all organizations present proposals of some sort to do business. The proposal may be written, given as a presentation, or arise from a business meeting. With informal proposals, sometimes only a handshake seals the deal.
In the government contracting community, proposals are often the principle way to keep and expand your business. Your ability to respond to government solicitations for products or services is vital for your business. Presenting excellent proposals requires not only first-rate writing, but also an ability to follow your business strategy and to develop your proposal strategy in concert with it.
You cannot decide to bid on work emotionally. The process must be well-documented and the approach thoughtful if you are to grow your business in accordance with your business strategy. Choose only those opportunities that will have a real impact on your business’s success, rather than pursuing every possibility that seems as if it might fit.
The decisions you have already made about the business areas where you concentrate your efforts should guide you to opportunities that fit. Consider each of these five top-level issues when considering whether or not to bid on each potential project. When you can answer “yes” to each of these areas, you will know you are on your way to success with both your business and proposal strategies.
1. Business Strategy – Does the opportunity fit your business strategy? If you’ve done similar work before, and the work is part of your overall business strategy, you probably also have good references to offer from existing clients. If the work is not your main line of focus and talent, then it should not be part of your business strategy. If you will need to go elsewhere to get resources, your odds of winning the contract are greatly reduced. By concentrating on your fundamental business strategy, you should be guided to only those opportunities that are reasonably close to your qualifications. If so, and the pursuit is well-thought out, you’re likely to be in a position where you can provide all of the customer’s requirements. Then you can check the “yes” box!
2. The Customer – Do you know the customer? And do they know your company? Is this customer one you want to work for? Do they already like what you do? Writing proposals to customers who already know you increases your likelihood of success by at least a degree or two. Most important, you must be able to quote or easily cite your experience with other clients who will also sing your praises. Get written references or talk with former clients to prepare them for a reference check. When you have them, this issue becomes a big “yes.”
3. Background – How do your credentials compare with those of your likely competitors? You must be able to clearly demonstrate what differentiates you from your competition. Convey that you have greater expertise, that you have all of the necessary resources so the client assumes that you are very low risk, and will deliver value beyond your price. Be sure to include a listing of your staff who have expertise in the areas the customer has requested. Brag about your resources, staff, facilities, financing, and project management of the job. Your sterling qualifications may even create some doubt about your competitors’ abilities or commitment to the project in the customer’s mind. Another “yes”!
4. Pricing, Profitability, and Risk – You must demonstrate to the customer that choosing you offers them the least risk. This does not necessarily mean you are the least expensive candidate but that you can perform at a reasonable price and deliver a good product or end result. Obviously, you don’t want to lose money on a project. You want to give your customers great value by giving them what they need, while you still make a decent profit. Smart customers know that successful, profitable suppliers will be less likely to cut corners. Without adequate profit, you simply cannot continue to serve them and others well.
Yes, I know there are loss leaders. Just make sure the loss is really worth the reward. If it’s not, then let it go. If your product or service is commoditized, so that the only way you can differentiate yourself from the competition is to compete on price only, you still shouldn’t work at a loss. Let your competition have the business. Some folks just seem to want to work for free!
Be sure every project is acceptable for your company’s risk quotient. Identify the risks and either adequately price-in unforeseen events with contingencies or walk away from the opportunity. Sometimes, if you bid on work you don’t fully understand, you may leave out some of the cost of performance and end up losing money on the job. Putting in so many contingencies that you make yourself non-competitive and lose the job is almost as bad. Neither situation does your reputation any good, either. Another “yes” check!
5. Hiring and Teaming – Sometimes you may want to bid on a job when you don’t yet have all of the resources or qualifications you need to deliver complete performance. You must be able to get what you need easily if you plan to propose doing the work. You may have to augment facilities, hire more qualified staff, or partner with another firm to complete your team. Can you do that in time to perform? Can you even do it in time to write the proposal? You must begin today to establish relationships with other capable firms who can be called upon to fill in for any technical talent you lack. This goes back to the business strategy tie-in: if you only bid for work that fits in with your overall strategy, you are likely to already have the relationships and resources you need. So, is that a “yes” for you?
Can you strongly and positively answer “yes” to the questions asked in the five issues above? If so, you can confidently pursue the opportunity. But this is just the starting point. Beyond making sure the proposal fits into your business strategy, you must also frame your bid to capitalize on your organization’s unique strengths to distinguish yourself from your competition. Your proposal must answer all of the questions the solicitation asks and give the impression that you’ve performed this work successfully before and can do so again in order to meet the customer’s needs. In other words, once you’ve chosen the right solicitation for your organization to propose for, you must make that customer want to choose you.
About the Author
Will Lindquist, President of The Management Link Incorporated, is a sought-after expert in the field of business management. He has a broad background and experience in business strategy, finance, and operations with both large and small corporations such as L-3 Communications, Orbimage, and Fleishman-Hillard. Will approaches every problem with an appreciation for the bottom line and how to grow his clients’ businesses. He brings both strategic and tactical know-how, focusing on financial considerations, business development, and operational excellence. His solutions are practical as well as innovative. Contact Will at Will@TheManagementLink.com. You can find out more about The Management Link at www.TheManagementLink.com
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