How do you measure your proposal department’s success? Develop financial measurement systems for your proposal process!

quote-for-proposal-success-blogI once worked on a technical approach where the Government’s evaluation came back stating that the project was awarded to another contractor, who appeared to have a higher price than ours. How could this be? Immediately the assumption was that there was a flaw in our proposal. We requested a debrief and learned that the apparent higher price was inclusive of all bid options and some additional betterments and energy improvements – which when comparative to our evaluated price, was $1.5-million less. In other words, it was a better value – the Best Value.

The significance of this is that there are many moving parts to a successful proposal process. Proposal success is not 100% dependent on a technical writer or an estimator alone. So how do you isolate these variables in order to measure the performance of your proposal department? What performance indicators are there which are inclusive only of what a technical writer has control of and thus can be held accountable to?

I am happy to share that there are methods to isolate these variables and measure a proposal department’s value and financial impact on the company.

As you measure your proposal department’s return on investment, value and success, have you considered using the following methods of measurement?

  • Win Rates – there are several methods to measuring win rates, but these have proven most effective: 1) Win rate on dollar value and 2) Win rate on must-win pursuits (this requires that you actually identify a small portion of your pursuits as high priority and/or must-win).
  • Efficiency and output – One of the most effective methods is to measure and improve response times on various proposal types (for instance, separate measurements of task order and best value IDIQ proposals). Are you developing standard narratives and processes to ensure efficiency? Do you maintain an effective proposal database? Is your database organized to minimize rework and increase accessibility?
  • Proposal Evaluation Ratings per proposal section – Similar to the sports mentality that “if we execute the critical routine things, like laying down the sacrifice bunt in baseball, the score will take care of itself” – I have learned that focusing on increasing proposal ratings puts your organization in a better position for best value awards. Example measurement could be “Increase Management Plan and Organizational approaches to Outstanding or highest rating on 50% of our pursuits”. Measure per section and identify where you are continually rated lower and focus on those sections.
  • Zero non-compliant proposals. Ever! Under no circumstances is it acceptable to have a non-compliant proposal based on submission requirements – 100% compliant, 100% of the time. A proposal department’s most important role is to keep the Company ‘in the game’. Our motto: Don’t lose on Technical!

To accurately measure the efficiency, success and value of your proposal department, certain factors should be isolated and excluded from the assessment. Here are some of those examples:

  • Pursuits in which the estimated price exceeded the Government’s estimate. On these particular pursuits, you can still measure the department’s success in regards to the section ratings.
  • Evaluate each pursuit and rate your chances of winning. “Low Probability” pursuits should be removed from a proposal department’s success evaluation. Perhaps you are trying to enter a new region, or the proposal requirements are so stringent that your experience will not show strong compared to your competition. Such pursuits may be categorized as “low probability” and should be isolated from success measurements of the proposal department.
  • Technical design approach non-compliance should be carefully examined to determine if the design was non-compliant, or if the submission was non-compliant. There is a distinct difference in which the former shall not be held against a technical writer’s success valuation. This rule applies to other sections, such as the CPM schedule development, etc. where a proposal writer may be reliant on operational expertise for technical compliance.

Here are some tips in developing and monitoring your goals and measurements:

  • proposal-success-blogReal-time input. As with every measurement system – the output is only as good as the input. To ensure this information is readily available in real-time, designate an employee to update results monthly, and share with the team quarterly. If you’re not on track, make the adjustments to get on track!
  • Be realistic. Measurements and goals are not one-size fits all. A goal to win 100% of your IDIQ pursuits or 75% of task order proposals is unrealistic. As a new firm, your proposal win-rates will likely be lower than industry average. As an established larger firm, your proposal win-rates should exceed industry average. If the direction of your firm is to diversify into new markets, those particular pursuits will likely have low win rates. Consider such variables when establishing your benchmarks!
  • Align with other company goals. Be sure to include input from others in the company. Truly understand the direction of the organization prior to developing measurements and goals.
  • Be patient. Increasing success rates is not an overnight process. Some goals may take a complete process change which could result in a six month or more investment. Set milestones and regularly review progress against the milestones.
  • Get management buy-in. This sounds simple and often feels overused and meaningless. It’s not that simple and involves much more than words of affirmation from upper management – “You know I support you and the department, and if you need anything, I am here to help”. Those words are meaningless without perpetual involvement and action towards support. Management buy-in means that upper management supports, unconditionally, the goals to improve. This means stepping in when necessary to require outside input into the proposal, requiring in-house operational support, not putting undo stress on the proposal department by overloading them and thus setting them up for failure, providing timely bid decisions, selecting team members early in the process, and so much more!
  • Allocate resources. The regular workload will still be there. It is important to bring in the proper help get the processes and measurement systems in place.

This is simply a high level review in how to measure your proposal department’s success so that you can evaluate the proposal department’s direct impact on the company’s financial success. If you establish measurements and determine that when isolating factors that are out of a proposal department’s control, and if the proposal department’s key performance indicators are indicating that their performance is aligned with or exceeding expectations, it’s time to look into other areas of the organization that may be affecting win rates. These other areas may include work load, management buy-in, the estimating process, the technical approach process, the design firm’s approach, or operational input into the process.

If you would like more information on how to measure your proposal department’s success and/or investment, please contact us at www.strategiccreations.com/contact.

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