Coulson-Thomas: critical success factors.

Most businesses would like to win more of the contracts they bid for. Bidding is a tough game. Intense competition and falling barriers to entry strengthen the negotiating position of buyers. As more contracts are put out to competitive tender and new entrants are invited to bid, the prospects of winning a particular opportunity can fall. 

Need to succeed

As expectations rise, responding to invitations to tender becomes more demanding and expensive. The cost of lost bids has to be recovered out of a squeezed margin on those won. Companies that win too few bids are driven out of business. Enterprises need to succeed in competitive bid situations. 

Yet according to reports from Winning Companies; Winning People Research and Best Practice Programme, some companies are much more successful than others at winning business. Studies undertaken cover sectors such as construction, engineering, manufacturing, IT and telecoms, and seven professions ranging from lawyers and accountants to engineering and management consultants. 

The findings are consistent and compelling. The approaches of bidding superstars enable them regularly to outperform ‘also-rans’ included in bid races to make up the numbers. Understanding the critical success factors for winning competitive bids and how high performers operate, and building them into winning business processes and job support tools greatly increases the prospect of increasing overall win rates.

A wide gulf exists between winners in the top quartile of achievement and the bottom quartile losers. The two groups appear distinct species with very different attitudes and approaches. Let’s summarise what the Winning New Business reports tell us about them.

Losers

Losers are undisciplined, unimaginative and reactive. They pursue far too many opportunities, and focus primarily upon their employers’ concerns and priorities. 

Members of ‘loser’ bid teams respond mechanically to invitations to tender. They are pre-occupied with the practicalities of producing proposals, such as obtaining cost information and the CVs of people who would be involved in delivery. They find themselves under pressure to meet submission deadlines. Yet they ignore support tools that could speed up their basic activities and free up thinking time.

Losers hold back and only commit significant effort when a prospect is ‘seriously interested’. While they may describe their jobs in terms of ‘winning business’, they actually spend the bulk of their time losing potential business as most proposals sent in are rejected. In businesses with low success rates senior managers let bid teams ‘get on with it’. They are rarely involved in individual opportunities.

Losers measure success by the number of proposals submitted. They make little effort to learn from experience or best practice. Rejection letters enable them to ‘close the file’ and move onto the next proposal. Above all, they don’t mind losing. Failure is accepted as the norm, and rationalised with phrases such as ‘you can’t win them all’.

Winners: more confident and proactive.

Winners

Winners are very different from losers. They are far more confident and proactive. They identify prospects with growth potential that would make good business partners. They take the initiative and approach those they would most like to do business with. 

Winners ruthlessly prioritise available opportunities. Turning down invitations to bid allows more effort to be devoted to those retained. Winners also want customers and prospects to do well. They become absorbed in their problems and opportunities, focus responses and structure proposals upon prospect needs, priorities and selection criteria. 

When winners do respond it is with commitment and clear objectives. They think through the outcomes and relationship they would like to achieve. They hit the ground running, and allocate sufficient resources early on to build up an unassailable lead. Senior managers in the more successful companies participate in important pitches. The visible and active support of senior management can be decisive in close contests.

Buying decisions

Winners try to understand how buying decisions are made. They identify and address the selection criteria being used. They consider the personalities involved and remain sensitive to changing buyer concerns throughout the purchasing process. They work hard to establish empathy, build trust, and match, the culture of prospects.

Where possible, winners automate the more mechanical aspects of proposal production. Support tools can be used to understand requirements, configure, price and present solutions, generate proposals and generally help a prospect to buy. Time freed up is used to tailor responses, differentiate offerings and build relationships.

At the end of the day, winners want to win. They are gutted when they lose. Win or lose, they regularly review their processes and practices, and debriefs are held to learn from both successes and failures. 

The results of surveys undertaken by the ‘Winning Companies; Winning People’ investigation suggest that winners could do even better. The ‘super bidders’ – the 4% who win more than three out of four of the competitive races they enter – are only very effective at less than half of the 18 critical success factors identified in the ‘Winning New Business, the critical success factors’ report. 

Quite simply, there is enormous opportunity for most businesses to significantly improve their ‘hit rate’. Yet, despite the potential for improvement, some companies review almost every process except that for winning business. You can avoid being a ‘loser’ by consciously setting out to become a ‘winner’ by putting additional critical success factors in place and adopting further winning ways.

For further information, please contact Cotoco on +44 (0) 1733 361 149; email cct@cotoco.com; HTEC House, Southampton International Business Park, George Curl Way, Southampton SO18 2RX, UK.

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