A crappy win rate or lack of bidding success is usually a direct result of bidding on too many losers, aka inappropriate “opportunities”.
Too often, professional services firms are tempted by the potential boost in revenue and go all out pursuing speculative tender and proposal opportunities. Generally, these firms have no consistently applied or objective “bid-or-no-bid” qualifying process and/or well-defined firm BD strategy other than “hope”.
In closely competed market segments – and there are many in law and other professions – rational decision-making can go out the window when a request for proposal is released. You’ll hear partners say: “Opportunities like this don’t come along very often!” Yes, but is it really an opportunity?
Costly mistakes can be made in this adrenaline-induced state we like to call “competitive arousal”. Competitive arousal can be helpful. It can motivate firms to focus and produce their best work in order to win. But it can also be debilitating to keep your team bidding on losers, especially over the long term.
5 reasons firms keep bidding on losers
So, why do firms keep chasing after tender, bid, and proposal “opportunities” that aren’t real opportunities? And are in fact losers.
To paraphrase and quote Seth Godin* “…there’s a valuable set of lessons here about human behavior”.
5 reasons your firm may keep bidding on losers include:
1. The bid is now.
It’s imminent. It’s yes or no. You can’t consider it for a week, a month, or even a year and come back to it. The urgency around a deadline (as Godin says) “creates a forcing function, one that turns apathy into support or opposition.”
2. The bid is specific
Are there other ways that a firm could effectively invest money, time, and resources into business development?
Could they invest in qualitative client interviews? Develop a signature event? Create original thought leadership? Upgrade their technology? Or, overhaul their digital presence?
But there’s an infinite number of business development alternatives vs just one specific bid “opportunity”.
3. The end is in sight.
When you produce a bid, you get a bid, often a (reasonably) well-written 100+ pages – almost like a “business book” about your firm; you can even print it out so it’s extra tangible. That’s rarely true for the more important (but less tangible or urgent) alternatives, such as strategizing and implementing a key client account program, conducting a website overhaul, or investing in a client satisfaction study.
4. People in power (and people with power) will benefit.
High profile or prestigious bid “opportunities” attract firm leaders and others who seek to be involved or piggyback on high-profile outcomes. Influential ‘star’ partners often have experience getting their way on these, which means that they’re better at convincing the managing partner or business development director to agree “once more” to throw a lot of scarce resource behind a bid without really considering all of the costs, let alone the firm’s ‘real’ chances. As the idiom goes, success has many fathers and mothers, failure is an orphan.
5. There’s tribal patriotism at work.
This is where you might start to hear things such as: “What do you mean you don’t support our firm/team? Look, we can do this work – I mean of course we’re not really doing it now, but we could learn it…”And there’ll always be some tenders, bids, and proposals that in their ‘wisdom’ the firm decides to pursue because:
“We should throw our hat in the ring!”
“If we keep bidding, one of them will have to win eventually.”
“I know one of the managers, and she reckons we should put in a bid.”
“I’ve got a bit of experience in <insert peripheral skillset or vague claim here>, so let’s do it!”
“If we just win this one at any price, from here on it will improve.”
“It won’t take long to put something together…”
“The marketing team is a bit quiet, it will give them something to do.”
“Gotta be in it to win it!”
“As the most influential partner I want the firm to do this, and I will not be questioned on it.”
As with many areas in life you need to know which battles to pick.
So what can you do to stop your firm from bidding on losers?
Inject some objectivity into your firm’s bid process
You can try to tame competitive arousal in your firm by establishing a more strategic and objective, bid-or-no-bid decision-making process and put a stop to the pursuit of poor-fit prospects. Two options to help improve your process and chances of avoiding losers are JMA’s:
- Simple 20 question bid or no-bid checklist
- More comprehensive bid qualification framework in Part 1 of Win more tenders – learn how to say no
My main tip is that whatever qualifying process your firm settles upon, use it religiously for each and every opportunity – big and small, formal and informal, government or private sector – no exceptions. Once your qualifying process has been conducted and documented, have it “signed-off” by the firm’s authorized decision-maker in such matters – Managing Partner/Strategy Committee/BD Director. That way there’s clarity and accountability around these sorts of (non)-strategic decisions, even if a loser bid does go ahead. Finally, once the bid is submitted and the dust has settled, ‘close the loop’ (even before the results are out) by conducting an internal bid team debrief – you might like to use JMA’s tender and bid debriefing guide for internal teams. Above all, it should always be remembered hope isn’t a strategy!
* This blog post was partly inspired by Seth Godin’s blog The Super Bowl is for Losers