Every now and again, with the daily collection of the mail, an unexpected package will appear from a company you may never have worked with before. Owing to the heft if the package, you may immediately identify it correctly as a Request For Proposal (RFP) and a terrific opportunity for you to acquire business. In your excitement, you may begin to plan on just how you will spend the money the project will provide as you congratulate yourself on becoming known in the industry and having been seen as worthy of bidding on a project from this company with which you have no previous relationship.

Before you start congratulating yourself and all of your marketing efforts in succeeding in having you be seen as an industry leader or progressive practitioner, slow down long enough to understand how that thick envelope reached your mailbox.

The Process

The company soliciting bids for a project in all likelihood has the following:

-Smart people working for it with years of experience in meeting business opportunities
-Relationships with others that have been called upon when the internal smart people either do not have the experience to deal with unique situations, or have been called upon to assist the smart people when the internal employees may have expertise and experience, but do not have the capacity to handle the assignment that is being outsourced to an external agent.
-A desire to be as minimally disruptive to the day-to-day working of the

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company as possible.
-A legal or moral obligation to receive competitive bids from multiple providers of services or products so as not to be seen as granting favors or sweetheart deals to one vendor at the expense of efficiencies, effectiveness, profitability, etc. of the company.

In order to fulfill the obligation of meeting a business need that is critical to the organization, maximize the use of internal resources for projects that truly demand the experience and expertise of internal employees, and maintain the contractual, legal, and ethical constraints of propriety; certain projects will occasionally be open for multiple suppliers or vendors to bid on in the hopes of demonstrating a level of competence, pricing, or other benefits that both suits the needs of the prospective client, and also differentiates that vendor's solution significantly enough from competition that it is recognized as the winning bidder.

Fair or Not

On the surface, this appears to be a fair and almost egalitarian approach to ensuring that the company receives fair value for services or products as the marketplace will self manage with no one vendor being able to offer a solution that is wildly outside the conventions of fair pricing or value. Additionally, it seems that all suppliers have a chance to demonstrate their innovation, creativity, expertise, or any other factors that would provide them with competitive advantage from a level starting point versus all other suppliers.

In fact, it is commonly done that should any vendors seek clarification of the process, or have a question - a public meeting may be held where ALL vendors are provided with an opportunity to ask questions and hear answers to questions others may have so as not to provide an unfair advantage to one supplier over another. In the cases where no meeting is held, there will often be a collection of questions by a certain date from vendors and then answers are provided to all vendors having completed a form noting an intent to proceed or a willingness to continue with the process.

Unfortunately, it is not always what it seems. The RFP includes detailed instructions for completing the proposal that may eliminate certain vendors from participating because of the time constraints required to provide a response exceed the available time allotted. Other considerations for completion may prevent some from participating because the requirements are such that the respondent may not qualify or would have to forego working with current clients in order to accept the assignment.

In fact, a good percentage of the time, the RFP was at least in part, created by a supplier or vendor that will be participating in the bidding. If you recall, the client company often has relationships with suppliers and vendors they commonly work with already. Rather than start anew with vendors or suppliers that are unfamiliar, the company may ask the vendor to participate in the drafting of the requirements for the RFP - and with that request, either intentionally or unintentionally, the vendor will skew the requirements in their favor over their competition (you).

Then Why Send Out An RFP?

The RFP process is designed to create a platform from which similar proposals can be compared and contrasted across multiple vendors to secure the best (in whatever way the best is to be determined; price, speed, originality, etc.) project scope for the soliciting company. Should it ever be challenged or questioned, the company can legitimately demonstrate that the process was followed, bids were secured, and the criteria for choosing the winner were applied. However, the qualifications and criteria for evaluation are pre-determined prior to the mailing out of requests for proposals and the responding vendors are rarely if ever allowed to interact with the business leaders requesting the responses. Instead, the communication is often handled by an intermediary from the company's procurement department or other so-called gatekeeper.

The company points to at least three or perhaps more qualified bids received and can then make an objective decision on which most closely meets the needs of the organization soliciting responses. From the outside looking in, all appears to be fair and able to pass scrutiny. Winners are determined and projects are assigned.

So Should You Respond?

As often as not, if your firm is not one that has worked with the soliciting company before, and an RFP was sent to your company, your chances of winning the bid are remote. In all likelihood, your company was chosen because it has expertise in the industry, function, project, etc. according to a web search or other directory service, but is being viewed only as a basis for comparison for the company to be chosen. A less flattering way to look at it is that your bid is "Column Fodder" and exists only to complete the requirement of having multiple bids to compare and contrast against the other more preferred vendors.

While it is not a high percentage outcome, it may be beneficial to ask for a meeting with the decision makers. Most, if not all of the time, it will be denied or your only access will be at the public meeting. Under the guise of having to diagnose the problem before you prescribe, the ability to ask your own questions, assess the situation yourself, and hope to demonstrate a deeper understanding than even the original creators of the RFP document; the only slim hope you likely will have for winning is to force the company to recalibrate their decision making criteria.

Sure, there are RFPs that are determined fairly and that are not slanted toward one vendor from the outset. However, to complete an RFP is time consuming and requires resources that few small business owners possess given the small percentage chance of winning in most instances. Before choosing to respond to an RFP, be certain that you understand just how the decision will be reached and how viable your response will be given all of the parameters in choosing the preferred vendor.

David Zahn is a serial entrepreneur and consultant to Fortune 100 businesses (www.zahnconsulting.com) as well as entrepreneurial startups (www.startupbuilder.com).

The opinions expressed are the author's and not necessarily those of connpost.com. Please direct comments to cdauber@ctpost.com.