To bid or not to bid (APMP Greater Midwest Chapter Presentation) Bob Lohfeld 4-20-11


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Seven Criteria for Making Sound Bid Decisions and Avoiding the Traps that Lead to Poor Bid Decisions

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  • 11:25 to 11:30* Didn’t address the text box and what it means (what are the seven “level 1” processes???)Use a scorecard approach to determining if an opportunity is worth pursuing. Is this opportunity—A strategic fit?For a customer your know (who knows you)?Have a solution that fits your capabilities?Winnable against the competition?Financial sound (profitable)?Highly probably of winning?
  • 11:30 to 11:39Example scorecard format for making pursuit decisions. Note that each factor is weighted differently for each company/opportunity. Strategic fit may be more important that financial objectives to one company, but the least important to another company. Set threshold below which you will not bid.You can also do it in a qualitative way and assign color scores. “It is okay not to be all things to all people.”
  • 3:49 to 3:5110 steps in capture process; at the gate reviews, you should assess how well the CM is doing relative to each step. The chart should demonstrate progress over time. If no progress is being made, it is okay to re-assess your pursuit decision and/or change the action plan. It is critical that the review team holds the CM accountable for progress in each of these ten areas. (Let the team do their own assessment, and then critique them on the assessment and make them defend their self-evaluations)
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  • To bid or not to bid (APMP Greater Midwest Chapter Presentation) Bob Lohfeld 4-20-11

    1. 1. To Bid or Not to Bid: Seven Criteria for Making Sound Bid Decisions and Avoiding the Traps that Lead to Poor Bid Decisions<br />Webinar Presented to APMP Greater Midwest Chapter<br />April 20, 2011<br />Bob Lohfeld, Lohfeld Consulting Group<br /><br />
    2. 2. The Traps That Lead to Poor Bid Decision-making <br />“We can win that deal because this is our kind of work, so let’s bid and don’t worry that we’ve never met the customer.”- Technical Manager<br />“Let’s bid deals that have the highest probability of success because we don’t get any bonus money if we finish in second place!”- Capture Manager<br />“Every dollar we spend on new business acquisition is one less dollar that we have to spend on other competing priorities, so let’s bid the deals that don’t cost very much.”- Financial Manager<br />“Let’s take a portfolio approach to deal selection to maximize the likelihood of achieving next year’s revenue number with a realistic investment in new business activities.”- Corporate Executive<br />“Shoot for the moon, all we need is one really big win and we can sell the company!”- Entrepreneur<br />2<br />
    3. 3. The right questions: Should we bid and can we win?<br />The wrong question: Would you like to do this work?<br />We should bid:<br />Deals that fit our core competency, and<br />Meet our financial objectives<br />We can win if we:<br />Understand the customer requirements and objectives<br />Can develop a sound solution that addresses real customer needs<br />Have customer advocacy<br />Favorable competitive environment<br />Have a clear win strategy—technical/management and price<br />Have the resources and time to pursue the opportunity<br />Asking the Right Questions is Key<br />3<br />
    4. 4. “They don’t know us, but we can introduce ourselves by sending them a proposal.”<br />“We can use this proposal as a training exercise.”<br />“You gotta play to win!” <br />Traps That Lead to Making Poor Bid Decisions<br />TIP<br />If they remember you at all, it will be as a loser.<br />TIP<br />You may make the customer’s “Wall of Shame” by having your trainees write and submit a proposal that was obviously done as a training exercise.<br />TIP<br />I can’t believe anyone would actually say this, but they do.<br />4<br />
    5. 5. Making the Bid Decision in Four Stages<br />Qualifying a deal: 7 factors<br />Improving your win probability<br />Commencement of pre-proposal activities<br />After RFP release<br />5<br />
    6. 6. Strategic fit: <br />Program focuses in core competency<br />Proven past performance, experience, management, processes, tools<br />Understand customer requirements and objectives<br />Requirements are what the RFP will say (SOW)<br />Objectives are what the customer wants you to accomplish by fulfilling the requirements (Goals)<br />Right solution<br />Technical solution ”right fit” for client<br />Past performance and experience in related work<br />Teaming partners available<br />Program manager/key personnel, staffing OK<br />Deal Qualification Scorecard (Seven factors)<br />6<br />Customer advocacy<br /><ul><li>You know customer; they know you</li></ul>Competition favorable<br /><ul><li>Can beat known competition</li></ul>Financial objectives<br /><ul><li>Start-up investment, expected revenue and profits, ROS, EBITDA, DSO</li></ul>Cost of Pursuit is affordable<br /><ul><li>Capture, B&P, IR&D investments</li></li></ul><li>Deal QualificationScorecard<br />7<br />Color code: Blue(excellent), Green(good, but could be better), Yellow(poor and needs much work), and Red(we don’t know how to begin)<br />
    7. 7. Deal Pursuit Progress<br />8<br />Blue= excellent Green= good Yellow= limited accomplishment Red= unable to accomplish<br />*Win probability considerations determined subjectively, but final win probability is objective evaluation<br />
    8. 8. Pre-Proposal Preparation Decision<br />9<br />Blue= excellent, Green= good, Yellow= limited accomplishment, Red= unable to accomplish<br />
    9. 9. Bid Decision Confirmation<br />10<br />
    10. 10. Bid decisions are made early using the seven factors in the qualification scorecard<br />Quality is built into the pursuit process by focusing on nine success factors<br />Bid decisions are reaffirmed when pre-proposal work begins—increasing your likelihood of success<br />Final thought—you will always be remembered for the deals you win, not the deals you chased… Bid to win!<br />Benefits of Making Bid Decisions Correctly<br />TIP<br />Deals that are not winners are discarded early<br />TIP<br />Deal pursuit progress scorecard using 9 factors focus the pursuit effort on making the deal a winner and discards losers early in the process<br />11<br />
    11. 11. About Lohfeld Consulting Group<br /> Follow us on Twitter:<br />Lohfeld Consulting Group specializes in helping companies create winning proposals.As the premier proposal services consulting firm focused exclusively on government markets, we provide expert assistance to government contractors in Capture Planning and Strategy, Proposal Management and Development, Capture and Proposal Process and Infrastructure and Training. <br />Contact Bob Lohfeld<br />CEO of Lohfeld Consulting Group<br />Email:<br />Tel: (410) 336-6264<br />12<br />