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War against RFPs RFQs and other tenders

October 12, 2009

(Reprise of piece first published 18 months ago, titled “War against RFPs, RFQs, and tenders for CMS projects”, revised to be less content management specific)

Let me flag my position ‘straight off the bat’ – I am not a fan of RFPs or any other form of tender. I have spent long enough working with suppliers, vendors and professional service businesses, and not a great deal on the commissioning side, so this position may come as no surprise. If you feel like discounting this view for that reason, go right ahead, however perhaps you may take a moment to consider my premise that no matter how good tenders are, the process and thinking is fundamentally flawed. Of course, if you insist that I write one for your business, then please ignore this post and we’ll both pretend that it is a good process.

Perhaps let me restate the analogy that I used in the original post on an older blog. I encourage you to have some fun with it (comments please), and poke all the holes in it that you wish …

As regulars of this blog will know, I have recently moved back to Melbourne after some fifteen months in Sydney. I, like many of us, need to get from my home to the office, get the kids to school, get around on the weekend and make interstate trips and occasional overseas travel. Oh, and I also like to travel around purely for enjoyment, every now and again.

Based on this, I could produce a set of needs and the send out an RFQ or RFP to Qantas and various airlines, the government’s public transport instrumentalities, purveyors of transport equipment (lets limit it to – Toyota, BMW, Hyundai, Kenworth, Volvo, Comeng, Yamaha, Malvern Star (Aussie bicycle company), Learjet, Sunseeker and NASA), as well as some transport service businesses (cabs, chauffeurs, vehicle rental agencies, travel agencies and the like). Free test samples gladly received, although my comprehensive testing may result in them being required permanently.

I’m sure you are onto me and have guessed where I am going with this!

My complete set of needs, examined holistically, is fairly unique (specific locations, times, preferences), however broken into the right component parts, it is much more generic than it looks collectively. Perhaps to me the whole set is a ‘project’, but from another perspective, my complete ‘travel needs’ are actually a range of segmented items, some that should be shared, some that are customized, and some that have flexible or exchangeable dynamics. If I was to send out an RFP for the whole project, I might get a response from some of the smaller service businesses, although I can’t see one coming in from BMW or the public transport system and many of the other sources I really need to get the best mix. If I choose to ‘do my own project’, I would spend significantly (multiple times) more than my needs require and most likely get a sub-optimal result. I may also miss out on the collective benefit that accrues from shared systems and volume-based solutions. Finally, in crafting the project to suit my perspective alone, I am assuming that I can frame a solution better than the named businesses, who have collective experience that spans many thousands (maybe millions) of users. Now I’m not completely sure, but I think BMW can probably design a better car than I could (haven’t stress tested this assumption).

The key point here is: I can best identify my needs but I am not best placed to specify the solution to them. Yet most RFPs get into deep specifics on where the cup holder should be, how many passengers should be seated and even the mechanical process by which the solution needs to be created (more analogy here). Engine performance and the colour of the upholstery may even be given exactly the same assessment priority (of course we know upholstery colour is much more important than practical considerations).

Restated, my core issues with the tender process are:

1) Most RFPs frame projects that would be better broken up around established market dimensions and component parts. In my case, I need at least public transport, a car, an airline and a taxi service – and wouldn’t ask any one of them to do the lot (apologies to Microsoft, IBM and custom builders who claim to do it all).

2) Most RFPs lead to outcomes that overweight custom deliverables at the ultimate cost of well-traveled common core deliverables that have been tested across large numbers of implementations.

3) Most RFPs are prepared with a strong knowledge of business needs but little product, market and related technical or specialist knowledge and experience.

4) The end result of most RFPs are unique projects that come at high cost and exhaust everyone working on them. Sometimes to the point that two-years later, no one who was there at the time is still working on the delivered solution, so someone throws it out and starts all over again (usually from scratch – having lost the accumulated knowledge).

Yes I know I’m a cynic, but I’m happy knowing that my car only provides part of my total ‘project’ and that if I become unhappy with it (as I am prone to do), I can replace it with another standard / generic / vanilla car that I am not unhealthily wedded to, because I didn’t design and build it from scratch, and I can find any other products and services to fill the other needs in my ‘personal transport project’.

Still with me? If so, either I said something useful or you are preparing a hostile response. Either way, I look forward to more conversation on the topic. Anyone need an RFP?

2 Comments leave one →
  1. October 12, 2009 3:52 PM

    Thanks for sharing. I read through the whole post (your bashing of RFPs), but the question remains, what is, in your opinion, a realistic alternative?


  1. 3D Procurement Solutions | War on RFP's and RFQ's

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