Rebid management

1. Re- Bid Management
Masterclass

2. To illustrate the impact of losing rebids let’s look at a hypothetical example:
You run a £100m business with contracts averaging three years in length. So on average each year a third of your
turnover comes up for rebid (£33m).
If you have an 80% rebid win rate this averages out at losing £6.6m a year in rebid loses. If you have more of your
contracts up for rebid in a particular year (or some of your larger contracts being rebid) the proportion could be
much higher.
And of course few businesses plan to stand still. If you are planning to grow by 10% a year and have a retention
rate of 80%, on average you need to be winning almost 17% new business to fill the gap and achieve your growth.
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3. Rebid Contract Life Cycle
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4. How much is your growth at risk from rebid losses?
Do you know which contracts you have coming up for rebid over the next three years?
Do you have a particularly busy year for rebids coming up?
And do you know what the impact will be on your growth plans of losing one, some or even most of those
rebids?
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5. Key measures about your rebid retention and contract portfolio
Key measures about your rebid retention and contract portfolio could be vital to help you plan ahead:
• What is your present rebid retention rate?
• Is it improving or getting worse?
• Is retention consistent across your portfolio or does it vary by size of contract, market, service or region?
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6. And looking to the future:
• When are the contracts in your portfolio due for rebid?
• Are there particular years in which more / larger/ more profitable contracts are due for rebid?
• What would be the impact of losing these rebids (or even losing the proportion indicated by your present
retention rate) on your turnover and profit?
• What would be the detailed impact on specific markets, regions, or service groups?
• How much resource do you need to plan for to cope with preparing for, and running your rebids?
• How much new business will you need to win each year to replace the business lost at rebid?
• And how much resource will you need to plan for to deliver that new business?
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7. What do you need to know to calculate your future rebid task?
Step 1: List your contracts
List out all your contracts and their end dates. For a smaller portfolio this should be relatively simple. But for a larger portfolio (or
for a set of portfolios across the company) you may need to look in a number of different places to pull this information together.
While you are listing your contracts you might want to group them in to subsets. For instance by size or profitability, by market,
region, service type or any other grouping relevant to your business.
Step 2: Add turnover, profit and cash flow
For each of your contracts add in the turnover and profit you are making (and if this is variable what you are forecasting to make
for each year of the current contract). You might also want to add cash flow for each. If you have contracts on different payment
terms, losing those on better payment terms could have an overall impact on your portfolio cash flow.
Step 3: Work out your existing rebid retention rate
Depending on the level of management information you already have this could be a significant task across a large portfolio.
Some companies keep a close eye on their rebid retention rates, others don’t. In some there is a retention rate that is ‘assumed’.
Knowing your historical retention rate is vital to planning ahead. Look back over the past 5 years and work out what your
retention rate actually is. For our purposes here you should look at rebids actually won or lost – don’t include extensions gained
(as some companies include in their published business retention figures), as we have mentioned above that is a separate piece
of information.
If you have grouped your contracts in particular subsets in step one, you should also look at any variations in retention rates
between these groups. It might have an impact for your planning as you progress. You should also look at whether your retention
rate is constant, improving or falling. This in itself might be new information to you if you haven’t looked at the raw data before. 7

8. What do you need to know to calculate your future rebid task?
Step 4: Work out your rebid degrade curve
You rebid degrade curve is the reduction in turnover, profit or cash you face each year from losing your existing
contracts at rebid. You can work this out by listing your contract turnover, profit etc for each year until the end of
the contract. Adding up the total value of those contracts for each year gives you the Forward Order Book you
presently have. As each contract comes to its rebid assume the contract is lost – so you get no further income
from it.
Step 5: Work through scenarios
It’s unlikely (hopefully!) you will lose all of your rebids. There are any number of scenarios you can work through,
depending on the priorities and shape of your business
What happens if you apply your present rebid retention rate?
• You will potentially find your contracts increase profitability over time, but need to be rebid at a lower profit – what
impact does this have?
• What impact does getting all available extensions have?
• What impact does increasing your retention rate by 5% have?
• What impact would losing your three most profitable / largest contracts have?
• Which year(s) are at the biggest risk from rebids and would potentially mean a significant drop in turnover or
profit if you don’t win them? 8

9. What do you need to know to calculate your future rebid task?
Step 6: Plan ahead
How much new business will you need to win to cover the likely losses from rebids?
• Is there enough new business coming to market in each of the years in your plan to deliver the growth you need?
• How much will you need to invest in business development to deliver this growth? (and what is the win rate on
new business efforts at the moment?)
• How much resource do you need to invest in rebidding in particular years? (remember the investment shouldn’t
just be in the year of the rebid – you should be investing in rebid preparation well before the rebid due date)
• What is the risk posed by rebid losses to the plan you already have in place?
• How much would you need to invest to increase the % win rate on your rebids from what it has been to date?
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10. Prepare for a rebid
• Failing to prepare really can be preparing to fail when it comes to rebids.
• The rebid preparation phase can be the most important in a successful rebid.
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11. Prepare for a rebid
Starting preparing for your rebid early is one of the best known ideas to help you win your rebid – but
something many incumbents don’t do. Part of the problem we often see is not having a clear idea of what
early really means – and what exactly the preparations are that will really improve your chances of
winning.
How early is early?
Some people will tell you that preparation for the rebid starts on day one of the contract.
When to start your preparations in earnest is: just before your customer starts their preparation – which will usually
be several months before the OJEU or announcement of the rebid is published. The reasons for starting at this
point are twofold:
Firstly it gives you time to complete your preparations properly (see below what these should be)
Secondly it gives you time to get access to – and hopefully some influence over - the crucial decisions the
customer is making in the months prior to the ‘official’ rebid process starting (when the OJEU or solicitation is
published
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12. Preparation actions
Some of the specific actions we recommend taking as part of your preparations are:
• Identify and prepare your rebid team. Include people who have not been deeply involved in the contract – they
will bring an objective view and help challenge the status quo. Typically this might be people from your sales or
business development team, depending on how you are organised. Include whoever in your bid team will be
putting the proposal together. And of course include your contract lead.
• Run a rebid start up workshop. Get the team together for a day to go through: what has happened on the
contract to date, who in the customer will be involved in the rebid and in what capacity, what the customer’s
expectations are for the next contract, who your competition is likely to be. You probably won’t have all this
information available yet – but the outcome of workshops such as this we have run for contracts has been a real
step up of focus by the team on what needs to be done, and an action plan for the key parts of your preparations
ongoing.
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13. Preparation actions
•Create your plan for the rebid. Typically this will be led by your sales or business development lead. The aim is
to capture all the customer relationships you need to (re)invigorate, the messages you will want to give, the timing
of the actions in this list, etc. The term ‘Capture Plan’ is usually used in the US for the work done prior to a new bid
to get to know the customer, influence them and prepare your solution. Others call it a Sales plan. For a rebid we
call it a Rebid Strategy – but the principles are similar. Just because you are the incumbent doesn’t mean you
shouldn’t put as much effort in as you would to win a vital new contract. Set the actions, dates for completion and
responsibilities. Put someone in charge and review progress regularly.
•Review your contract. Go right back to the start of the contract and identify what has happened over the course
of it – the contract story if you like. Did it start well? What has your performance been like (get the data for the
whole contract)? What improvements have you made or added value have you delivered? What problems have
there been (and how did you resolve them)? What does the customer think of you now (not just your operational
customer – all those who might be involved in the rebid decision). Your aim should be to collect all the evidence
you can for use in your rebid, and to fix any outstanding problems on the contract before the rebid starts
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14. Preparation actions
Understand what the customer’s needs are for the next contract. They are unlikely to be the same as for the
existing contract. There is a natural tendency as the incumbent (especially if your contract is running and
delivering well) to repeat too much of the existing contract in the rebid. Focus instead on what the customer’s
strategic drivers and aims will be over the coming years, what impact these could have on the contract, and what
impact changes in technology, industry best practice, your competitor’s offerings and other factors could have. Ask
the customer. List out these changes in need and opportunities (before starting to identify how you can meet
them). Even if the customer is likely to publish a specification close to that of the existing contract (which does
sometimes happen), they will still want to see significant changes, improvements and reduced costs in the
solution – which they are likely to get from your competitors looking afresh at the opportunity.
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15. Preparation actions
•Create a new outline solution. Don’t wait until the PQQ/ RFI or ITT/ RFP come out on the basis you don’t know
what questions the customer will ask. Creating your solution now will give you time to:Refine it and test it internally
with the team before needing to write it out in the time pressurised environment of the bid process;
•Test aspects of it with customer coaches to get their feedback and preference for it;
•Influence the customer, if you can, to ensure the specification and bid rules allow you to put in the solution
(perhaps even adjusting their specification to fit);
•Perhaps even start putting some aspects of it in place on the existing contract to show the customer how it
provides them benefits (based on your understanding of their future needs you have already identified), enable
you to evidence its effectiveness in your proposal, and check the working and costing of it – and reduce the
amount of change required to get to the new solution in the next contract (reducing the risk, time and cost of your
transition – another advantage for your bid).
When the customer does publish their needs and questions you should of course review what they are asking for
and answer the questions set – not blindly give them your preferred answers. But if your preparations have been
effective there should be few surprises.
There are of course other things you can be preparing before the official start of the rebid, but if you start early
enough to get these six things in place well before the OJEU is out you will be in a powerful position by the time
you get there. And you will have significantly improved your chances of retaining your contract. 15

16. Who should run your re bid?
When the customer does publish their needs and questions you should of course review what they are asking for
and answer the questions set – not blindly give them your preferred answers. But if your preparations have been
effective there should be few surprises.
There are of course other things you can be preparing before the official start of the rebid, but if you start early
enough to get these six things in place well before the OJEU is out you will be in a powerful position by the time
you get there. And you will have significantly improved your chances of retaining your contract.
When we are asked the question we don’t name a particular role. Partly because different businesses are
structured differently. And even when they have similar sounding job titles, the actual roles and
responsibilities of those jobs can vary.
Rather than just name a role, we suggest that those who ask us think about what is actually needed to run a
successful rebid, what team is best placed to deliver this, and who has the right skills and experience to deliver.
Here are what we see as some of the main tasks, and perspectives, needed to run your rebid - and win.
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17. Who should run your re bid?
• Understanding your customer
• Understanding what you have delivered
• Challenging the status quo
• Bringing a fresh approach
• Leading the team
• Delivering a customer focused price and submission
• Influencing the customer
if your company is rebidding opportunities on a regular basis, and you recognise the differences between a rebid
and a bid for new business, why not use someone in the role who has experience of retaining contracts
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18. Focusing on what’s new in your rebid submission
One of the dangers for incumbents is they focus too much on their existing solution in their rebid. Too often the feedback
from the customer to a losing incumbent is that their rebid submission didn’t contain enough that was new or innovative,
and just rehashed what they were already delivering.
Ideally as you approach your rebid (during what we call the Recapture process) you will take a completely fresh view of
your potential solution for the new contract. You will build it from the ground up (creating a Green Field solution as we
encourage our customers to do) based on what your intelligence from the customer, and latest best practice tells you they
need for the next contract – without being held back by the ‘inertia’ of your existing solution, no matter how well it might
be delivering now.
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19. Focusing on what’s new in your rebid submission
• How customers evaluate your submission
• Your existing solution is not added value
• The earlier you start, the more value you can add into your solution
• Four methods you can use to mitigate the problem and get the most out of your position
○ Highlight the new
○ Identify added value in your existing contract
○ Use your experience as incumbent to clarify the benefits of your offering
○ Focus on the future in your writing
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20. Recapture Plan
Why is a Recapture Plan different?
•As you are already delivering the business there can be an assumption you already know the customer. That isn’t
always completely true. A Recapture Plan (and the Recapture Manager leading this effort) needs to overcome this
assumption and focus on ‘getting to know the customer all over again’
•There can be a tendency to underplay changes in the customer requirements. The Rebid is the customer’s
opportunity to make changes to the service they are receiving. The full impact of (and reasons for) these changes
can be underestimated by incumbents, influenced by their existing delivery experience. The Recapture Plan has to
focus on the changes and overcome any sense that they are minor and can be ignored.
•As you are already delivering the existing contract in a certain way (especially if you are doing so successfully
against existing measures), there can be an in built inertia against looking afresh at what the best solution going
forward might be. A Recapture Plan must ensure you look beyond your existing solution.
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21. Why is a Recapture Plan different?
•Being the incumbent, the customer already has direct experience of your ability to deliver, and your approach to
them and the contract. This usually gives you an advantage – but only if you can effectively exploit it. The
Recapture Plan needs to analyse all the information gained over the period of the existing contract. Both about the
customer, about the contract, and particularly about your own performance.
•If things have not gone well on the contract, or if the customer is looking for significant change in the new
contract, the customer’s experience of your existing delivery can work against you in their perception of you. The
Recapture Plan needs to identify these potentially damaging perceptions and overcome them.
•As the incumbent you have delivery team ‘on the ground’. The Recapture Plan must balance the experience and
knowledge of the existing delivery team with the experience of bidding processes bought by a bid team, and the
new and innovative ideas and challenges to assumptions that ‘outsiders’ to the delivery team can offer
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22. How do you put a Recapture Plan in place?
Get an early and strong kick off to the Recapture process
Get a clear starting date to the recapture effort by running a workshop or meeting where you get all the relevant
stakeholders involved focusing on the rebid about 6 months prior to the official customer start of the bid process.
Get people from the contract team, the bid team, other departments who will be heavily involved in the rebid effort
and others such as Account Managers, Sales people etc if they are part of your structure to attend.
Focus the day on asking questions about the customer, the contract and the rebid to see what is already known, to
uncover assumptions and, crucially to find out what you don’t know as a team about the rebid.
Exposing areas where the assembled team are unsure or things they don’t know can overcome any presumptions
that all is well and little action is required (or required yet). By creating a set of actions you give yourself as the
Recapture Manager a reason to drive effort by people and review progress.
Set out a clear calendar of actions and reviews for the Recapture Plan
Your initial review of the rebid above will have created a set of initial tasks, and some action and focus. However
there is a danger that if you don’t keep momentum going that focus will drift. To maintain the initiative and keep a
focus on the Recapture Plan, moving forward the actions needed to win make sure you put in place a calendar of
actions and reviews to check progress and readiness.
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23. How do you put a Recapture Plan in place?
Put your resources in place
Unless you are running a very small rebid, the job of the Recapture Manager is not to do all the work yourself.
Instead it is to coordinate, manage and lead the activities of the team who are doing the work. As with a new bid,
this is likely to comprise people for various departments as well as members of the bid team.
But with rebids you are also working with the operational team delivering the existing contract. They will have a
vital part to play in the rebid. They form part of the team creating the new solution, and providing costings and
materials for the written submission. But they will also, though their actions on the existing contract influence your
chances of winning.
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24. Recapture Plan
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25. Recapture Plan
• What to focus on in your Recapture Plan
• Review your existing contract performance
• Broaden customer relationships and your understanding of the customer
• Build a clear understanding of the customer’s strategic needs
• Focus on what is changing in your customer’s needs and the rebid
• Develop a new outline solution early and test it with the customer
• Make necessary changes to your existing delivery
• Fixing issues
• Getting new information
• Testing your new solution
As the incumbent you should be have considerable advantages vs your competitors. Too many incumbents
squander many of these advantages by failing to prepare early enough, with the right vigour, and with the right
approach. By creating and implementing a Recapture Plan you should be able to make the most of your
advantages and win more of your rebids.
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26. Lessons for incumbents from lost rebids
• What we’re delivering now is fine
• The customer already knows that, we don’t need to tell them again
• The customer will choose our superior solution, even though it’s expensive
• They can’t deliver it for that price!
• No one told us our contract was being rebid!
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27. Making the most of the Transition
Transition to the new contract can be a big strength for incumbents in their rebid submission. Incumbents often require less
of a transition to move from their existing solution to the new solution proposed, as they already have assets, staff, processes
and systems in place.
That should mean reduced risk for the customer as well as less time and cost in getting the new solution in place compared
with competitors. So it should also mean the incumbent gets high marks for this section of any rebid submission.
But too often incumbents turn this strength into a weakness by not taking the transition seriously, assuming the customer
implicitly understands these benefits or (as in the case study we use below) just telling the customer that no transition is
needed.
• Don’t be afraid to make changes
• Make the most of your advantage
• Resource the Transition properly
• Look at what you can deliver early
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