3 Small Mistakes IT Vendors Make During a Sourcing Event that are Detrimental to their Success


Win-win strategies for IT vendors in a sourcing negotiation

Most of our blogs primarily focus on providing actionable advice to buy-side organizations. This blog is a departure from this approach. The focus has shifted to providing advice to IT vendors to help them be more successful during a sourcing event, by alleviating frustrations voiced by buy-side companies.

Three frequently heard complaints expressed by buy-side organizations during the course of an IT sourcing event follow.  While they don’t necessarily drive sourcing decisions, they most certainly impact them.

1. Contradictory responses within an RFP response

It is surprising just how often we see and hear of this happening.  Before submitting an RFP response, it is critical you make sure it is complete, thorough, and void of any contradiction. Contradictions come in many forms and are frustrating to the evaluator, often leaving a lasting bad impression.

A perfect example of this is when a solution is stated to be included in a proposed bundled price in one part of the response but later it appears as a line item within an attached bill of materials. Is it part of the bundle or do you have to pay for it separately?

Evaluators are left wondering, “If this is how my questions are treated during the “courting” phase of the relationship, then how are things going to be once we are two or three years into a relationship?” 

They are also left without a definitive response to include in their overall evaluation and assessment, which is never a good thing especially if the competition has provided a competitive, clear and concise response.

2. Incomplete response to a very specific request/question

Most buy-side organizations spend a significant amount of time and effort pulling together the RFP prior to submission to the various IT vendors. With this comes an expectation that the IT vendor’s submitted response reflects the same level of effort and thoroughness.   When this simple expectation is not met, the evaluator naturally becomes frustrated and their attention shifts to the IT vendors that actually met the expectation and presented a complete and thorough response to the specific questions.

When an evaluator’s attention shifts away from the incomplete response, it effectively removes it from consideration. Having any part of the RFP response removed from consideration that easily and quickly, especially when there is a competitive environment, is extremely detrimental. In most cases, every response counts towards the ultimate decision.

If you are not in a position to provide a complete response, it is essential that you provide your rationale. At a minimum, if you can’t provide a complete response, you must address the following as part of your response:

  • The reason a complete response was not able to be provided
  • What additional information is required in order to provide a complete response
  • When you will be in a position to provide a complete and compelling response

3. Referencing additional documentation without more specific guidance

One of the most common frustrations raised by buy-side organizations is tied to situations where IT vendors reference additional documentation without providing guidance as to where in the documentation the question is actually addressed. For example, when you reference a master services agreement because there is contractual language within it that addresses the question, you must also clearly identify the actual section within the master services agreement where the language is found that addresses the question.

Also, for reasons stated above, it is important to only reference documentation that actually addresses the question in its entirety.  A perfect example of this is when an RFP requests insight into the service level credit structure the IT vendor is willing to provide, and a reference is made to a service level agreement that has no service level credit structure within. Seeing the reference to the actual service level agreement creates an expectation that the IT vendor, in fact, is willing to offer a service level credit structure.

Once it is determined that the service level agreement doesn’t provide a service level credit, the evaluator’s reasonable expectation is unfilled, and the evaluator naturally develops a negative impression of the IT vendor when assessing the overall quality of their response.

Why Didn’t We Get Asked to the Party?

If you are struggling to figure out why your organization’s RFP response did not lead to an invitation to participate in the next round, you may want to go back and reassess your approach to replying to the RFP.

  • Did you do any of the items raised above?
  • If you did, what could you do differently next time?

I am not suggesting that an IT vendor’s future fortune will change if each of these items is addressed. Ultimately, a compelling solution with a strong value proposition must still be offered.   These are also not the most essential or heavily weighted details in a sourcing decision. But they are items that are absolutely considered by evaluators tasked with making decisions and thus should be addressed and accounted for appropriately.

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