I’m a big fan of Tom Sant, who wrote the essential book for writing proposals, Persuasive Business Proposals. I heard him speak in Atlanta last year at the Association of Proposal Management Professionals conference and since then I’ve been on his mailing list (if you want to get his tips, sign up here on his website). In this tip below, which I’ve reprinted with his permission, he makes it clear why pursuing opportunities (and writing proposals) when you haven’t done your homework is a waste of time.
Hope Springs Eternal, But It Doesn’t Make Quota
by Tom Sant
Recently I was working with one of the world’s largest banks where a senior member of the proposal team shared with me the following story:
The bank has an assessment process in place which was designed to indicate whether an opportunity is a strong bid, a “light” bid, or a no bid. Over the past six months, the process indicated in numerous situations that the opportunity was a no bid. On 60 different occasions, someone overruled the process to insist that the proposal center create a bid anyway. They were just convinced that this time it would be different. The assessment tool was wrong. This opportunity really was worth pursuing!
So guess how many of those 60 opportunities actually resulted in wins?
[Dramatic pause while you think about it, with Jeopardy music playing in the background…]
That’s right. They went 0 for 60 when they overturned the assessment screener.
Now here’s the follow-up question: How much did it cost the bank to pursue those 60 opportunities?
Most of them were mid-market opportunities and most of them involved responding to a Request for Proposal of medium complexity. Given the time and resources that kind of proposal effort takes, each of those proposals cost the bank between $10,000 and $15,000.
So by giving in to whatever pressure was exerted, the proposal center wasted between half a million and a million dollars of resources in just six months.
Sales people tend to be optimistic by nature. They need to be so they can bounce back from the inevitable rejection they encounter. But optimism is not an account plan and even if hope does spring eternal, it’s not going to help you make your quota.
It’s good to be optimistic, of course. But as the late Tom Amrhein used to say, “The best way to improve your win ratio is to stop bidding on stuff you can’t win.” By the same token, the best way to drive waste out of your sales and sales support operations is to strike an intelligent balance between enthusiastic optimism and steely-eyed reality.
Tom hits the bullseye. I get paid by my clients to manage and write high-end proposals, but I don’t like to see my clients lose, and a beautiful proposal will not win if your proposed solution is wrong or if the prospect’s needs aren’t fully understood or if the prospect is just going through the RFP process so they can get to their pre-determined winner. I might try to talk you out of going after a proposal when we sit down to review the RFP. Why would I talk myself out of getting paid to produce a proposal? Because winning is more fun. And winning makes you forget the hard labor of developing the proposal. But losing just piles on more pain.
So the next time you get an RFP, let’s talk it over. Let’s you and I make sure you have a chance to win and that it’s going to be worth chasing.