IT Services Bid Management Enabling Framework

IT Services Bid Management Enabling FrameworkInnovation Crafting ProcessIT ServicesBidManagementEnablingFramework Innovation Crafting Process© Crafitti Consulting Private Limited www.crafitti.com 1

BID MANAGEMENT ENABLING FRAMEWORK Navneet Bhushan and Karthikeyan Iyer Navneet.bhushan@crafitti.com Karthikeyan.iyer@crafitti.com© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 2

Background Bidding for Information Technology Services or Information Technology enabled Services (The IT/ITeS) is a highly context sensitive activity fraught with many uncertainties and impacted by multiple imponderables. Managing an IT/ITeS bid involves multiple stakeholders and skills. The aim of dedicated bid managers is typically to carry out high number of bids in a specific time period and increase the win/bid ratio. However, due to increasing number of bids and the amount of information needed from multiple experts or stakeholders to organize a response for a bid, it is a challenge for the bid manager to organize high quality response to the customer needs in the compressed time lines that invariably creeps in despite the best intentions. This impacts the overall quality of the bid response and in fact impacts the win-bid ratio to a considerable extent. There is a need to ease the task of bid managers to generate responses to a large number of bids where each bid has its specific peculiarities and each bid may require multiple mix and match of existing services that the IT services company provides. Crafitti was involved in working with a large Indian IT/ITeS Company to improve the effectiveness of the Bid Management system. During the initial interactions with the Bid management team in the Telecom Services Provider (TSP) vertical specific pain areas were articulated by the team. It was decided to use the Innovation Crafting Framework for solving the pain areas. This framework propels the team to take a holistic approach by taking the problem through clearly distinct phases of – (I) Problem Formulation/Exploration/Definition (II) Ideation/Solution Generation/Brainstorming (III) Solution Development (IV) Solution Evaluation (V) Solution Implementation (VI) Monitoring of Benefits. Each of these phases require half-day workshop with almost half day of offline work by the teams per week for over 5-6 weeks as the case may be. This report describes the complete process and also documents the key solutions and improvements created using the Innovation Crafting by designing a new Bid Management Enabling Framework.© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 3

Developing a Bid Management Enabling Framework (For Telecom Services Providers Vertical of a global IT/ITeS Services Provider)The Need: Bidding for IT/ITeS services is a highly context sensitive activity fraught with many uncertainties and impacted bymultiple imponderables. Managing an IT/ITeS bid involves multiple stakeholders and skills. The aim of dedicated bidmanagers is typically to carry out high number of bids in a specific time period and increase the win/bid ratio. However, dueto increasing number of bids and the amount of information needed from multiple experts or stakeholders to organize aresponse for a bid, it is a challenge for the bid manager to organize high quality response to the customer needs in thecompressed time lines that invariably creeps in despite the best intentions. This impacts the overall quality of the bidresponse and in fact impacts the win-bid ratio to a considerable extent. There is a need to ease the task of bid managers togenerate responses to a large number of bids where each bid has its specific peculiarities and each bid may require multiplemix and match of existing services that The IT Company provides.Telecom Services Providers (TSP) VerticalDuring the initial interactions with the Bid management team in TSP Vertical specific pain areas were articulated by theteam. It was decided to use the Innovation Crafting Framework for solving the pain areas. This framework propels the teamto take a holistic approach by taking the problem through clearly distinct phases of – (I) ProblemFormulation/Exploration/Definition (II) Ideation/Solution Generation/Brainstorming (III) Solution Development (IV) SolutionEvaluation (V) Solution Implementation (VI) Monitoring of Benefits. Each of these phases require half-day workshop withalmost half day of offline work by the teams per week for over 5-6 weeks as the case may be.THE PROBLEMThe TSP Bid Management Team felt the need for improving their Bid process. These are the pain areas that the teamidentified (Please see Appendix I) • Identification of proper stakeholders for participating in the Bid • Inadequate requirements from customer in the Request for Proposal (RFP). • Lack of competency in the technical team to deliver solutions. • Partnering with product vendors • Short deadlines on the response submission • Updating reusable components • Lack of The IT Company Expertise • Bandwidth of Finance and Delivery teams to contribute to the Bid. • The winnable price point is not known to the Business Development Manager (BDM). • Lack of empowerment of Bid manager to call a no bid based on Qualification of the Bid. • Relationship with the customerThe pain areas listed were a mix of problems and solutions. Crafitti team tried to scratch below the surface to expand andarticulate the problem statement using Phase I of Innovation Crafting Framework.Phase I: Problem Formulation/Exploration/Definition PhaseWHITE HAT – WHAT WE FOUND (Information, data, facts)The team (The Crafitti team and TSP Bid Management) got together and wore the White Hat to define the problem and itssurrounding environment. The aim was to build on the team’s definition of the problem (above) and create a consolidated© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 4

overall picture of the problem space and the problem within it. The White Hat Mind Map is given below. For details abouteach item please refer to Appendix II.RED HAT – What the stakeholders Believe – feelings, emotions and perceptionsThe team then got together to wear the Red Hat and look at the problem from an emotional perspective. This was again acontinuation of the problem definition phase and the idea was to define the problem from a different perspective. The RedHat generated some interesting points. The details about each emotional belief/perception are described in Appendix III.Phase II: Ideation/Solution Generation/BrainstormingIn the Ideation workshop (Edward De Bono’s Green Hat), following main areas for ideation were decided (Please seeAppendix V)- (a) The team decided that a completely new system design rather than ideas for system improvement is what it needs to focus on (b) Rather than focusing on the existing bottom up approach of responding to a bid, it was decided that a solutions based approach is needed. This top down approach and its various elements need to be developed. (c) TRIZ Inventive Principles were used to trigger generic ideas from outside the field perspective.Following key solution directions were culled out of ideas that came out in the brainstorming session: NEW SYSTEM DESIGN!A Well-Defined Framework Management Commitment and Organization Structure- Get Bid Clear Decision Making done more closer to customer site SOLUTION BASED APPROACH! Creating a Strong DomainBuilding a ready- Vendor Ensuring Creating a Solution Competencymade Look-up Relationship Clear Menu – just liketable for WBS/ Management Customer “do it yourself”resource loading Drivers Meals Visibility NEW WAY OF DOING THINGS! Bid Team instead Web Based Bid Writing SystemRole Play- Can we Leverage theSimulate the Creative of Bid Manager – Focus on one BidCustomer during Bid Frenzy at a TimeResponse Crafting© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 5

Phase III: Solution DevelopmentWith the Ideas generated in Phase II, Yellow hat sessions were conducted offline as well as with the team on the followingareas: (a) Bid Response Look up Framework (b) Vendor Relationship Management (See Appendix VIII) (c) Customers Drivers Understanding (See Appendix IX) (d) New System Design – Process and Organization Structure (See Appendix X)Further a yellow hat session was carried out by The Crafitti team offline on following white hat points: • Inadequate Bid Strategy • Lack of Common Operating Picture (COP) • Customer Value Proposition • Lack of risk taking ability by BFM • Relationship with customer needs to be enhanced • Critical to customer (CTC) is not evaluated • Schedule squeeze • Delivery Capacity Constraints • Response sent without having capability • Regarding ownership of bid • Regarding Previous History of BidThis session yielded about 40 different ideas (See Appendix XI):At this point the distilled understanding of the information, emotions, creative solutions and development of solutionshave been synthesized into the BMEF components as described in Figure 1 as the Bid Management Enabling Framework.BID MANAGEMENT ENABLING FRAMEWORK© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 6

Balanced Vendor Customer Metrics Relationship Drivers Organization Structure Ball Park Estimates Solution Based Approach BM Process Solutions Alternatives Menu Prequalification Model BMEF Bid Strategy Customer Value Model Dynamic Teaming KM Execution Strategy Bid Approach Roles and Process Responsibilities Execution Multiple COA BDM BFM BM Bid Team© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 7

The framework consists of following elements:  Bid Management Organization StructureThere are four different organization structures that came up during ideation (a) Onsite Bid Manager (may be Geography based) backed by an Analyst Team offshore (b) BDM provides the initial solutions on his own onsite (may be through a web based bid management system) (c) Bid Team travels onsite – finish off the bid response after initial traction by BDM – backed by the offshore team (d) A Web Based Bid writing system is continuously being written, updated and maintained. This is visible to all stakeholders as the bid response is being written.  Bid Management Process Alternatives – Bid Life Cycle ModelsBesides the existing bid management process which clearly is non-optimal in terms of maximum effort is spent at the lastmoment – which is a crisis mode of operation, there were three alternative bid management processes came duringideation. These are called Focused Frenzy, Continuous Common Operating Picture (COP) and Distributed Creative Frenzywith Continuous COP. The existing process is termed the Last Minute Frenzy Bid management process - Existing Response Delivered Client BDM BM Last Day Delivery/ Horizontals Fren Time Proposal A – Focused Frenzy - Process Respons e Client Delivered BDM BM Last Day Delivery/ Horizontals Fren Time© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 8

Proposal B – Continuous COP Process Response Delivered Client BDM Final BM Touc hes Delivery/ Horizontals Time Proposal C – Distributed Frenzy with Continuous COP Respons e Client Delivered BDM Cr Cr BM Cr ea eat eat tiv ive ive Delivery/ Horizontals TimeFor each of the Bid Management Processes, detailed life cycle templates and milestones need to be created, as furtherstep. The Bid team will have the option of choosing any one or combination of process options as per the Bid.  Vendor Relationship Model Alternatives (Please see Appendix IX)  Bid Strategy FormulationFor each bid, it is imperative that the bid strategy is formulated upfront. The components of bid strategy are (a) Pre-Qualification Model –for every bid based on Key parameters (b) Customer Value Model (c) Ball park Estimate using the Look up table (d) Teaming Strategy a. Based on Size & Criticality b. Competitor/Customer Role based c. Multiple Role play by Bid coordinators (e) Specific Process/Approach for the Bid (Can be chosen from a library of processes or Bid Life cycle models) (f) Generation of Multiple COAs (Courses of Action) rather than following one solution  Solution Based Approach Ball Park Estimation Approach© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 9

Solution Offering Type of Bids Technology eTOM components (i, ii, iii, iv) (a,b,c,d) (1, 2,3,4) Estimation Estimation Estimation model for i, a, 1 model for i, a, 2 model for ii, b, 2 … Project Project Project schedule schedule schedule • The solution offering should be categorized into different buckets • Every option should be mixed and matched; a consolidated list of Offerings for which models have to be built needs to be arrived at • This has to be piloted for the practices within TSP before taking it to the Horizontals (PoC) • For building the model, AHP technique could be adopted • We need to come up with parameters such as # of parameters that could be present in an Estimation model etc. All parameters should be divided into “Must have”, “should have” and “nice to have” buckets and accordingly the model should be built. • The model should be able to incorporate feedback based on past experiences • This will lead to a Solution Menu development which customer can pick and choose.  Knowledge Management System (To be explored as per the context and domain needs)  Execution based on chosen Life Cycle Model (To be developed further)Each of these components of the Framework need to be developed and we propose possible use of followingtools/techniques/methodologies during the development of each component:Possible Methodologies to be used for Development of framework components:  Analytic Hierarchy Process (AHP)  Six Thinking Hats  Perception Mapping© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 10

 Role Play  Gaming  Mind Mapping  Dependency Structure Matrix (DSM)  TRIZ© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 11

Appendix I Pain Areas – Initial Articulation • Identification of proper stakeholders for participating in the Bid • Inadequate requirements from customer in the RFP. Competitors know them through internal information (e.g., Verizon) • Lack of competency in the technical team to deliver solutions. There are two broad areas • Solution area • Product area • Partnering with product vendors - (Requirement of license fees etc) • Short deadlines on the response submission • Updation of reusable components. • Lack of The IT Company Expertise. There are two broad areas • Resources have the expertise but The IT Company does not. (Lack of references, case studies.) • Resources do not have the expertise. • Bandwidth of Finance and Delivery teams to contribute to the Bid. • The winnable price point is not known to the BDM. • Lack of empowerment of Bid manager to call a no bid based on Qualification of the Bid. • Relationship with the customer - Eircom (Did not have a presence in Ireland).© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 12

Appendix II White Hat – Facts, Information and Data 1. People/Teams involved in a Bid a. Client The client plays a source/sink role in the Bid process. Mostly, the Bid team doesn’t interact directly with the client, client interactions being handled by the BDM. b. BDM The Business Development Manager is the client facing interface of the Bid Team. He also decides the final bid content, qualifies the bid and in general is the key decision-maker in the overall Bid Management Process. c. Bid Manager The Bid Manager is the central point of contact for a bid. He interfaces with the BDM to get his inputs on the Bid requirements and expected response. He identifies the stakeholders in the bid – people who need to provide technical inputs to the bid. He manages the bid response creation and completion process by soliciting inputs from various quarters, stitching the different inputs together, providing timelines and deadlines and providing a consolidated Bid Response to the BDM. He also interfaces with the BFM to decide the costing structure of the bid. d. BFM The Business Finance Manager decides the costing structure of the bid. e. Delivery team The delivery team(s) provides technical inputs to the bid. The teams (or individuals within teams) are identified by the Bid Manager. f. Stakeholders “Stakeholders” is a common term used to describe all people providing inputs to bid response creation. This includes the various technical teams, pre-sales teams, vendors etc. g. Pre-sales The pre-sales teams play a key role in providing a customer-centric context of the bid (owing to the fact that they are likely to be geographically located in close proximity to the customer as well as being involved in other bids for the same customer). They also provide technical inputs as and when required. h. Verticals and Horizontals This is more of a breakup of “Delivery Teams” based on The IT Company organization structure. The inputs solicited are usually technical – specific to the expertise that the person brings to the table and the needs of the bid. i. Vendors Vendors provide the hardware and infrastructural solutions that are part of the overall bid response. Vendors are selected based on The IT Company’s relationships with various vendors, their capabilities, the bid requirements and cost. They are usually independent players located overseas e.g. IBM. 2. Current Process© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 13

Discussions revealed that the current process (or the current ideal defined process) doesn’t exist explicitly on paper. However, there is a fair understanding of what the recommended process looks like: a. Approach Note from The IT Company to the customer This is not strictly under the purview of the bid management process as viewed by the bid team – it is considered as a pre-RFP process which is taken care of by the BDM. b. RFI/RFP from customer to The IT Company There was unanimous agreement that this was step 1 of the Bid Management process. Once an RFI/RFP is received by the BDM, he forwards it to the Bid Team. It is picked up by one of the Bid Managers in the Bid Team. There seems to be some sort of an RFI/RFP pipeline, with different Bid Managers servicing the pipeline based on individual capacity or urgency of bid response. Usually, there are a couple of different response dates provided by the client:  Last date for clarification, till which time there can be a flow of queries/clarifications between The IT Company (Bid Team – BDM) and client.  Final submission date, which is the last date for submission of final Bid Response. c. Bid qualification by Bid Manager and BDM Bid qualification basically involves the decision on “go” or “no-go”. This is based on the evaluation of importance of bid by the BDM and The IT Company’s capability for bid and chances of conversion by the Bid Manager. Roughly, about 25% of bids fall in the no-bid category. However, the BDM might still want a response for a no-bid. These bids are marked as starred bids. d. Bid strategy The components of bid strategy are not clearly defined. Bid strategy, at a high level, includes the overall plan for bid response creation and submission (within specified timelines) as well as an understanding of bid contents, structure of the bid and costing issues. As per the team’s understanding, the strategy is worked out by the BDM and the Bid Manager. e. Stakeholder identification by Bid Manager Based on the type of RFI/RFP, the Bid Manager identifies the different people that need to provide inputs to the bid response. These are the stake-holders in the bid (the name is slightly misleading). f. Solution crafting by Bid Team Solution crafting usually begins with a Kick-off meeting to get all participants on the same page. Timelines/deadlines are communicated. The Bid Manager shares bid-related information (documents, previous history etc.). During the solutioning phase that follows, the Bid Manager interacts with the different stakeholders (horizontals, pre-sales, verticals, vendors etc.) to craft the bid response. The Bid Manager also collects queries/questions from the Bid Team and forwards them to the BDM; he forwards the responses/answers received from the BDM to the Bid Team. The Bid Manager and BFM also start working on bid costing issues. g. Draft Response by Bid Team The Bid Manager stitches the draft bid response together based on inputs received from the stakeholders. The bid is sent to the BDM for review. h. Sizing/estimation by Bid Team The bid response is evaluated by the Bid Team to estimate the size of the bid. i. Rough order pricing by Bid Team and BFM© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 14

The Bid Manager and BFM work the pricing strategy and overall price structure for the bid based on the draft response. The BDM is also in the loop here. j. Review/rework by Bid Team Based on comments received from BDM and BFM (and possibly other stakeholders), the Bid Manager updates and creates the final bid response. k. Submission The bid response is sent to the BDM for submission to the client. 3. Metrics The BDM is evaluated on run-rate – total revenue generated. The Bid Team (specifically, the Bid Manager) is evaluated on hit-rate – number of bids converted. 4. Capacity The Bid Managers typically handle 1 bid request per week. However, the range of bid timelines is pretty wide – some as low as a couple of hours, and some extend up to a month. Each bid manager typically works on multiple bids at the same time. Sometimes, some bids have to be worked on priority basis. Also, quality tends to suffer if the number of bids to be worked on is too high. How much is too high? The team wasn’t able to associate a number with too high, but greater than 1 bid per week is a good starting point.We also learnt that our current Bid conversion rate is less than 15%. Each member of the team was asked to provide his“Top 3 reasons/causes” for the low conversion rate. The consolidated list of causes was as follows: 1. Solution Quality – solution not stitched together well enough. 2. Force-fitting due to lack of expertise 3. Lack of common operating picture 4. Not of interest to horizontals – they don’t feel like stakeholders 5. Lack of sense of ownership of bid 6. Lack of differentiated solutions 7. Lack of risk-taking ability from a BFM standpoint 8. Lack of expertise 9. Bid strategy inadequate 10. Schedule squeeze 11. Inadequate problem analysis 12. Poor customer value proposition 13. BDM relationship with customer – market intelligence 14. Previous history 15. Critical to Customer not evaluated 16. Customer choice – we lose to competition 17. Response botched up despite having capability 18. Response sent without having capability 19. Delivery capacity constraints© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 15

Appendix III RED HAT – What the stakeholders Believe – feelings, emotions and perceptions The team then got together to wear the Red Hat and look at the problem from an emotional perspective. This was again a continuation of the problem definition phase and the idea was to define the problem from a different perspective. The Red Hat through up some interesting points. Summing up, the Red Hat session resulted in identification of the following areas with pros as well as cons: 1. Passion and teamwork The team felt that the current process lacks passion. There were references to grand old days when the team used to get together regularly to discuss bids and thereby generate a lot of enthusiasm and passion towards bid creation. Seniors would help juniors. Now, the process has become a chore rather than a fun-filled and challenging activity. People just go through the motions. Motivation levels are low. The same applies to teamwork. The process has somehow killed the teamwork aspect. People now work on an individual basis and do not feel integrated with the team. This also leads to lack of common operating picture and impacts bid ownership. 2. Bid pressure There was consensus on the fact that the pressure on the team for submission of bids was very high. The team was correspondingly in constant fire-fighting mode. There was also consistent pressure flowing from the top. Irrespective of capacity of the team, bids were expected to be completed and sent across. This resulted in crisis-mode operation and low quality of bids. Contrasting metrics further aggravated the problem. Due to constant pressure, focus on the bid tended to waver. Also, sometimes, context switches were required to process certain bids on a priority basis without impacting any of the other bids. At the same time, the team felt that pressure acted as a catalyst (more like a poke in the butt) to get the work done and that such a poke was essential in many cases (as long as it affects someone else). 3. Crisis mode operation Everything gets done at the end. There is a huge lull before the storm of frenzied activity at the end. Inputs tend to come in only when a deadline looms large and there is some sort of pressure from the top. In the absence of pressure, bid ownership is pretty low. The Bid Manager has to run from pillar to post for inputs but the inputs come in only at the end. Often, bids are compiled in the final hours before a deadline. Quality and content of bid take a massive beating. However, the team felt that the adrenalin rush at the end helped get the job done and the forced focus at the end also resulted in better teamwork and concentrated productive activity. 4. Bid ownership Other than the Bid Manager, the stakeholders do not have enough of a stake in the bid thereby the sense of ownership is lacking. This translates to delayed responses/ responses of poor quality, iterative rework and overall sense of frustration. 5. People interactions Most participants concurred that good bids are essentially those that are well managed. Managers who interact well get the job done better than those who don’t. Such managers show trust and confidence in individuals, have a sense of humor, good understanding of the bid and also create an environment of mutual respect. On the other hand, there are people who are intimidating, resort to pressure tactics, want to get their way all the time, consider the bid team as a secretarial team and resort to blame games or nasty post-mortems. This impacts the overall climate and has an impact on the bid quality. 6. Learning from the past There seems to be no attempt to learn from past bids – good and bad. Every bid is a standalone bid – the wheel gets reinvented. Sometimes, the past experience of customers hampers the success of the current bid. Also, there is a huge lull pre and post bid. There is no information on how the RFP reaches the bid team and client related information is© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 16

minimum. Absence of context sometimes reflects in the bid contents. Also, what happens to the bid response is seldom shared with the team, cutting off learning opportunities. 7. Risk-taking ability The team felt that risk-taking ability was low from the bid team as well as BFM standpoint. Experimentation is considered taboo. Sticking to the path of least resistance and low risk seems to ruffle the least number of feathers. In turn, this approach leads to process monotony, lack of creativity, no attempt to generate alternative solutions/better offers.© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 17

Appendix V TSP Bid Management Enabling Ideation Workshop1. Trigger for Discussion/Ideation: In the review of the TRIZ questionnaire that the Team had filled it was mentioned thatthe Bid team would like a continuous/regular customer interaction during the bid process. In this regard the trigger wassince customer can’t come can we simulate the customer inside The IT Company during the bid process.Question for yellow hat: How can we simulate the customer during the bid response process so that we receive immediatefeedback?2. Out of the New System Design Vs Improvement in the Existing System as the two alternative problem statements, theteam unanimously chose the New System Design option to ideate on.Green Hat session on the New System Design2.1 Building a Framework which would suffice the need of bid-management (Main Ingredients)Components of the framework are – People, Knowledge Management System, Bid Management Process, Qualifications forvariation of bid management process as per context, Mechanism for ensuring right amount of energy and momentumduring the process and involvement of stakeholders.  Right people  Right amount of energy & momentum – This will ensure that we have a good momentum from day-one on the bid and we don’t save all the energy for the last day.  Right amount of involvement between the stakeholders and the team working on the bid  Involvement includes engaging the customer also  There is a need to have regular meetings to get heads-up as well as status of previous bids  Knowledge management system  Artifacts covering various aspects of bid  Reusable components  Customer differentiator samples  Previous experiences with customers  The IT Company solutions offerings  Case-studies  Multiple business models  Bid management Process to control and define  Roles and responsibilities  Progress of the bid  Checkpoints to validate the contents of response - are we responding according the customer needs  Decision making process  The actual bid-process could vary depending on the following  Geography  Size of the bid  Type/area of the bid© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 18

2.2 Understand the criticality of Bid Response and Organizational Commitment/Structure needed with AssociatedManagement Challenges  Senior management mapping with customers - lacking in new or not well established accounts.  Investment in Bid Management activities - a lot of people do this part time or because theyre not on any other active assignment. Need to put dedicated, senior people on the job.  BDMs need strong insight into the customer priorities  Strong Bid Managers/Ownership/empowerment to take decisions (consensus doesnt work in all cases - eg. no/no-go for bid, pricing etc)  Investment strategy should be finalized (customers are not looking for simple costing models and want to see upfront investments from the vendors)  Pre-qualify bids and only focus on strategic/key/winnable bids  Poor quality bids should not be allowed to go out - hopefully will be a deterrent to all stakeholders – A mechanism to assess the quality of the bid response2.3 Organization Structure  Bid management to be run from Onsite supported by Analyst team from offshore. Analyst team to see a 360 degree view and work on providing templates, and knowledge to support the bid strategy.Trigger from TRIZ Inventive Principles  By enhancing the BDM’s capability he can actually create the bid response at onsite.3. Repeatedly there was a discussion about $100 M bids versus less than $10 M bids – the way each is treated is same,which needs to be looked into. The question boiled down to the approach of Bid response – it was mentioned that thebottom up approach based on number of resources needed and then doing costing is passé, the large bids need a solutionbased response and costing. This Top down approach was also given as a trigger to the team for the green hat sessionGreen Hat Session on Top-down Approach3.1 Building a ready-made Look-up table for WBS/resource loading  Irrespective of 1M of 10M approach is always the same - based on work-breakdown/resource loading. This gives comfort to BFM/Delivery heads. Past experience shows that this is mostly inaccurate. Also mostly the final resource loading may differ 100% from the initial estimate (onsite/offshore mix, no of resources etc.) to meet the BDM dictated prices  We need to build ball-park figures for different solutions (e.g. basic inventory solution on product x costs amount y). This along with appropriate dependencies and assumptions would probably be a more scientific/realistic approach.  The ball-park figures are to be based on past experiences. We may need to engage external consultants/domain experts to do this. A Proposal from NB – use Analytic Hierarchy Process (AHP).3.2 Vendor Relationship Management© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 19

 We need to build strong alliances with vendors so that we know what the license cost would be for a certain solution/what hardware requirements are imposed etc.3.3 Ensuring Clear Customer Drivers Visibility  To make this approach work we would also need good insight into the customer drivers (cost, technology, alliances, business risks etc)3.4 Creating a Strong Domain Competency  Have strong domain competency to give insight into building ‘Top down’ models  Experience, knowledge to support the top down approach, readily available costing models, questionnaires, Solutions menu.3.5 Creating a Solution Menu – just like “do it yourself” Meals (Trigger from TRIZ Inventive Principle)4. A Random TRIZ Inventive Principle Storm was conducted after the Green hat sessions. Some of the ideas are alreadycaptured in the relevant portions above. List below is thoughts that came from Inventive principle triggers. 4.1 Soft Challenges to be responded to  Resources Committed for longer time with more experience. We need to replace cheap resources with experienced consultants. Currently a not-sought after role - most people work for 6-8 months as a stop-gap arrangement - in this time-period they cant function beyond being coordinators.  Encourage Risk Taking Cost of failure is high, inhibits people from innovating and taking risks - need to have well established accountability for both not-winning and winning at any cost.  Decision Making Empowerment We need strong decision making empowerment - today’s scenario is consensus driven with nobody willing to make decisions. 4.2 Web Based Bid Writing System A web based system where the commonly asked questions are already kept with a web interface. The current bid manager reads it and keeps it always current. Answers to each question are also tagged with the bid response prepared for specific bids in the past.5. Offline Discussions within PO yielded following Organizational approaches worth exploring 5.1 (TRIZ Trigger) Maximize the Effort during maximum result yielding period Thinking about what actually happens on the ground in a typical bid creation process, the bid team typically manages to compile a bid with a flurry of activity right at the end i.e. within highly squeezed timelines. Deadline pressure acts as a catalyst to get people to work together in a focused manner with automatic elimination of non-value added activities. Also, team members are forced to devote quality time to the job at hand.  The thought is to turn this problem into strength (TRIZ Trigger). Bid teams should work in crisis mode focusing on one bid at a time. Bid preparation can be viewed at as a game, with time as one of the key constraints. An Illustrative example below 1. Say a bid needs to go out in 10 days. 2. Day 1 - Bid Manager identifies team. Team gets together and works on broad bid strategy. Team also evaluates the minimum possible time in which bid can be prepared if it were a crisis situation with all team members required to© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 20

devote all their efforts towards the bid. Lets say, the team works this out as 3 days. The team blocks days 7, 8 and 9 for this bid. 3. Day 2 - Day 6 - Bid Manager provides data for team to keep thinking about. This is a no-pressure time for the team (for this bid) for rumination on bid strategy and approach. Other than thinking, the team will not spend any time on this bid. 4. Days 7, 8 and 9 - The bid team gets together, preferably working in a common workplace and focuses on the bid creation process. Different strategies can be used here for bid creation - gaming for instance. 5. Day 10 - The bid is studied for final rework and approval. Day off if the team is satisfied. :-)5.2 Instead of single Bid Manager – create a Bid Team for each BidBecause one bid manager needs to coordinate with delivery, BDM and horizontals, he lacks cohesion. Create a Bid Managerand two bid coordinators. For each bid, the manager is different and coordinators are different, but from the pre salesteam. The coordinators coordinate with Delivery and Horizontals and bid manager coordinate with BDM. This results in astructure wherein BDMs rep, Horizontals rep and Delivery rep need not be present in all meetings – the team of three bidmanagers create it. Further since this happens in a specific time period if combined with 5.1, the focus the bid gets from allthree will be same as the current scenario but time is compressed. Further since the team focuses on only one bid at a time,the quality of output will be best possible. *****© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 21

Appendix IV New System Design BDM receives Bid Runs the Bid per existing System design Feedback should be on Yes basic Is there a Forwards to parameters SAM? SAM Bid gets over like Speed of response, Quality, pro- Within 6 hours of activeness, No receiving the bid communicatio Gives feedback on a n Forwards to Bid Team completeness, (irrespective of whether delivery standard template about Flexibility etc; team/practice is involved) each bid participant to Need to give Primarily to discuss based his/her manager specific on collective Expertise on examples in Value proposition, Calls for a lessons learnt case of –ve Bid Manager arranges for a Commercial model, feedback; Internal Bid Strategy meet meeting with all Project management approach, whom to stakeholders and Bid team contact etc to discuss good/bad things about the bid Kick-off Meeting with all stakeholders WHAT IT SOLVES© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 22

Solves the following issue BDM receives Bid Runs the Bid per existing System design • Empowers the bid Manager (authority coupled with responsibility) • Problem of not Yes being kept in the Is there a Forwards to SAM loop wont be there SAM? Bid gets over • Could solve quality Solves the following related issues issue No • Bid arriving late to Gives feedback on a Forwards to Bid Team Bid Team – at the last moment standard template about (irrespective of whether delivery team/practice is each bid participant to his/her manager Solves the following involved) issues Solves the following issue Calls for a lessons learnt • Issue of Feedback Bid Manager arranges for a not being Internal Bid Strategy meet • Uses the collective expertise meeting with all incorporated of Bid Team stakeholders and Bid team to discuss good/bad things • Everyone in the bid • Has a lot of ideas before the about the bid team learns from kick-off meeting; so able to the process Kick-off Meeting with all add value; stakeholders • Helps in • Could substantially change subsequent the image of team from bid Internal bid coordinators to bid Managers strategy MeetNew System Design (Alternative II) • BDM receives Bid from Client. • Can look at KM and send first level of questions himself/herself. If KM material is not available will send it to backend team. • Sends out the Bid to Horizontal Pre-sales team (onsite-Geo) • Manages the interactions between different Pre-sales teams • Sends the response to BFM- Geo based • Delivery teams/ Backend teams are responsible for creating/ Maintaining all Tools/ Guidelines/ costing Guides to support BDMs. • For Non-Standard bids/ High Value Bids the BDM sends out the Bid to Backend to respond.Advantages: • BDM manages response and knows what is required to “Win” • BFM is Geo based and can manage margins within Geo • Pre-sales teams are also geo based. Therefore can understand the customer context better • Response time will be shorter for standard bid responses. • Sales team can take strategy calls/ decisions faster if tools/ costing guides/standards are available. • Consistency in response across Geo’s/ Customers/opportunities.New System Design (Alternative III) • Bid management team gets a Bid from the BDM. • BM Qualifies the Bid and co-ordinates a meeting with all stakeholders for a go ahead on the Bid. • Bid Team travels to site to liaison with the customer and undertakes the Bid management process.© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 23

• Bid team identifies Bid response team and front ends with the customer. Identifies all possible questions from the Bid perspective and sends it to the customer. He may/may not • take help from the technical team. A standard set of questions for all types of Bids should be readily available. • The back up team has a Knowledge management process where all artifacts covering the following are available • 1. Reusable components - Covering all aspects like annual results, etc • 2. Standard SI Bids repository. • 3. Standard ADM Bids repository • 4. Standard BPO Bids repository. • 5. Case studies for ADM, BPO, SI differentiated along the lines of geography and technology are identified. • 6. Pricing solutions - BM picks up the best fit commercial model to bring maximum value to the customer. • 7. The IT Company Differentiators • Following are the points that the Bid team should parralley underatke along with teh Bid response • 1. Map customer senior personnel. • 2. Proper information about the customer price points and priorities for outsourcing should be achieved from the customer location.© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 24

Appendix VIII Vendor Relationship Management (Top Down Approach)Play with cost1. Slightly Less Slightly MoreBuild the relationship by giving more cut to vendors (higher cost for The IT Company) for becoming a preferred SI2. Prior contradictionPay the vendor only when we get the client money3. Leverage volumes of Indian market. Leverage The IT Companys presence in different geographies to create a sales pitchfor our vendors.4. Show potential and carry through on deals. Start with teaser pricing and build YOY growth - improves trust5. Replace integrated, expensive and unused platforms with nimble products perhaps not requiring platinum reliability.Seek low cost niche vendors, startupsPlay with quantity1. Other way roundFix a customer-vendor tuple in a geography e.g., in Europe Vendor A is preferred; in GSM networks vendor B is preferred2. SegmentationThink about sub components of multiple vendors and create a new component with best performance and sell it back3. DynamizeCreate a group of complementary vendors and make a solution grouping and keep it for solutions4. Prior actionPre arrange vendors in multiple geographies and create a solution map in each geo5. Thermal expansionMix and match multiple vendors solutions/performance differences and create multi level solutions6. Create multi-tier relationships for various products – For Class A customer Vendor A for Class B vendor B.7. Try and maintain at best 2-3 vendors per domain, product areaDo something for the vendor1. Leverage The IT Company IP Sales force for vendors2. Continuity of Useful action© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 25

Give that this vendor product will be mentioned in atleast X number of RFP responses that THE IT COMPANY gives.Further The IT Company will place vendor products in all marketing brochures etc.3. Remove TensionBecome a VC fund for all vendors giving some second round or first round funding4. EnrichHelp them becomes global vendors5. Make vendors our clients. Provide services to them.6. Recommend vendor to others, maybe competitors . . . Even if we lose a bid, the vendor might be able to still benefit.7. Let the vendors interact with other vendors that we know of8. Evangelize vendors capability within WT. Play with the vendors product - lot of evaluation licenses; show interest; letWT developers ask questions9. When vendor is growing, offer WT capabilities to enable it: people, facilities, investment, sales support, piloting and aftersales support10. Show The IT Company potential - introduce them to other geographies specifically BDMs11. Create solutions which both client and vendor like.Explore Relationships1. Other Way roundThink about ways in which vendor comes to The IT Company for relationship2. Prior ContradictionLook at the competitor and vendor relationship and destabilize it3. Create multi-tier relationshipsClient <---> The IT Company <---> VendorClients clients, vendors clients, clients competitiors, vendors competitiors, clients vendors etc.Create relationships with vendors through our clients.4. Stay in constant touch.5. Exchange offerPossibility of BDM performing a vendor sales function and vedor sales rep performing BDM function here. This will helpboth appreciate each others concerns and capabilities.6. Have joint sessions, conferences, seminars where vendor and The IT Company can come together to understand eachother.7. As a sign of faith take them to a few sales calls© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 26

8. Show and share WT (not just TSP) business projection of near future; ask for vendor portfolio evolution9. Let vendors build relationships with us. Make WT presence felt. Improve accessibility by advertising collaborationopportunity that vendors are likely to see and appreciate10. Facilitate an eBay sort of auction mechanism offering WT distribution channel. Advertise need and vendors may try toget in on the bid. Perhaps the customers too can post needs on WT portal11. While vendor is focused on their portfolio, strive for multi level contact across the cross section of the organizationalhierarchy: executives, sales, managers, architects and developersMaximize benefit from vendor potential1. If we cant play volumes, look at playing the specialization card.e.g. startups flourish despite players like The IT Company because they play on niche skills they devise innovative solutions they work on future market opportunities which provides options for non-linear growth2. Collaborate with vendors on R&D.3. Ask vendors to promote us. ****© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 27

Appendix XI Yellow Hat session on White Hats Issues (The Crafitti team) TSP Bid Management Enabling FrameworkRegarding Inadequate Bid StrategyAction 1For each bid capture following information as early as possible 1. Client Value Net – (Client Customers, Complimenters, Suppliers and Competitors) 2. The IT Company Competitors – (in the geography and with respect to specific client) 3. Client a. Objectives b. Key Decision makers (roles) c. Tradeoffs (one objective affecting other objective if multiple objectives are there) d. Drivers e. Ideal Solution that customer want without any constraints 4. Requirements Gaps Matrix Skills Objectives Tradeoffs Drivers The IT Company Existing Skills The IT Company can acquire Can craft along with partners Gaps 5. Proposed Steps a. Identify Gaps b. Ideate on filling the gaps c. Align Client Objectives and The IT Company Objectives d. Generate multiple Courses of Action (COA)/ Solutions e. Reduce the COA’s – Choose the relevant solution f. Stick to the chosen approach g. Communicate with the team h. Create a template – after piloting – create a mandatory bid strategy document to be produced asap and kept for the repository (Excel/PPT/Word)Action 2 Define components of bid o Value  Time  Cost  Functionality  Relationships o Critical Value  Key customer value proposition© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 28

 Key requirements o Competition  Who?  What is the competitor capable of?  Strengths/weaknesses o Ability  Are we equipped to prepare bid within the timelines? o Strengths and value additions  What extra things do we bring to the table?  Where are we with respect to competition? o Readiness  Do we have bandwidth?  How much bandwidth do we have? Is it sufficient to come up with a good bid? o Completeness  Do I have all the information needed?  Are we aware of all components of the bid? o Necessary conditions  Bare minimum for a good bid. Without this – no-bid. o Sufficient conditions  Maximum things required in a bid. No beating around the bush. o Impact of no bid  What do I lose if I don’t bid? Teaming Strategy o What should my team composition be? o Who does what? o How will the team work towards final bid? Information Sources o Where can I get information about various aspects of the bid?  Customer value  Critical to customer  Client environment  CompetitorsAction 3  Composition of bid team should vary depending on bid size or bid criticality: o Not all bids should have a team composition of similar kind. For high value bids, the team MUST consist of persons who ultimately take decisions for project go / no-go.  Minimum bid lead time should not be less than 2 calendar days and not more than 7 calendar days: o There must be extreme focus when making a bid. o Any thing less than 2 person days will not produce a quality bid. o Anything more than 7 person days will not have the proper focus. Eleventh hour tendency will creep in.  Use highly professional presenter as bid front-end:© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 29

o A person with good communication skills should front end the bid rather than a high techie who is not a good communicator.  Entire bid team should go to customer place and be there for at least a week while bid formulating: o Understand the customer circumstance as much as possible before bidding.  Do a game theory + Set based thinking before and during the before bid submission: o Look at scenarios, especially from customer end and competitor end.FOCUS on each bid should be the new mantra.Regarding Lack of Common Operating Picture (COP) 1. Use Dependency Structure Matrix (DSM) (rectangular DSM) for creating a common operating picture  RFP needs Vs Horizontal/Vertical/Role/Person  People Role Vs People Role 2. Share the DSM and evolve with the new information (Evolutionary DSM) 3. Use Visual board for each bidRegarding Customer Value Proposition  Get clarity of multiple perceptions from customers (use the perception mapping tool) – perceptions of people at customer end; perceptions of people in bid team  Find out the contradictions and tradeoffs and solve the contradictions using TRIZ Inventive PrinciplesRegarding lack of risk taking ability by BFM  BFM may traditionally perceive risk to OM and thus be focused on OM protection. Additionally, BFM should consider OM growth and/or account growth  Let BFM build (more than one) risk reward options; BFM may seek more than one technical solution and not be constrained by one. This puts back pressure on solution teams to incorporate set based thinking  BFM is to proactively drive account growth - a role redefinition may be in order. At the moment financial engineering seems to be the main activity. Account level profitability, opportunity and strategy need to be driven with active BFM participationRegarding relationship with customer needs to be enhancedThe key enabling factor to enhance such relationship is to build credibility, at the least through the following  follow through on commitments; Specific deliverables, the customer is expecting either through analysis, cases, proposals etc., the BDM needs to ensure the deliverable is timely and to the point in a manner usable by the customer  listen and relate; effective understanding of the customer scenario including a well rounded assessment of the problem needs to be developed at the earliest. In this context one may indicate relevant WT expertise - carrying out productive discussions with the intent of making the customer look good© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 30

 provide reasonable and logical proposals even at ball park level; the value propositions one makes, how reasonable the assumptions are, the sound factual and/or experiential basis puts the BDM on a footing of credibility. Having wayward and widely swinging arguments does dent credibilityRegarding Critical to customer (CTC) is not evaluated  Presales and/or bid team may quickly read the customer request (RFI, RFP, RFQ) and develop a collective assessment. Further, characterize the need in terms of key factors critical to customer  These CTC factors may be validated through the Q&A window prior to response submission  BDM is to validate the CTC and seek additional customer channels of validation of WT understanding of CTC  A model based on AHP may prove fruitful in arriving at a consensus on CTC factorsRegarding Schedule squeeze  Focused bid preparation process consuming minimum time needed. Advance planning and blocking of time for bid preparation.  Create templates based on timelines. Scope and detail increase based on amount of time available. Set expectations of BDM correspondingly and unambiguously.  Queuing and flooding evaluated for workload balancing. < 1 day 1 page < 5 days 10 pages < 1 month 10 pages with attachments for detailsRegarding Delivery Capacity Constraints  Not more than 2 bids to be handled by a team at any time: o If there are more than two bids, then the team should queue. Having more than two bids simultaneously, team will lose focus.Response sent without having capability  Be open about The IT Companys capabilities.  Do not overtly over commit on a bid that The IT Company knows it cannot fully meet either due resource constraint or lack of technical knowledge.Regarding ownership of bid  Team will have ultimate authority to make the bid: o Only the bid team will authority to have go/no-go on bid. This makes it imperative that bid decision maker (As noted in item 1) is part of the team.Regarding Previous History of Bid  Collect data from past project as to why and where The IT Company lost the bid:© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 31

o Keep a database from the past bid as to why and where The IT Company lost the bid. Put in KM system so that such mistakes are not repeated again.© Crafitti Consulting Private Limited www.crafitti.com Confidential June 27, 2011 32

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IT Services Bid Management Enabling Framework

by Navneet Bhushan on Jul 14, 2011

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IT Services Bid Management Enabling Framework — Document Transcript