Request For Proposal (RFP) Software

Request For Proposal (RFP) is a methodology for selecting a supplier to provide a good or service, generally as part of a Sourcing exercise. The essence of sourcing is that the buyer announces to the market their intention to purchase a good or service, and then suppliers present their offers. An RFP is a formalization of this process whereby the buyer defines their requirements in more detail. At its most sophisticated, an RFP involves:

1. A set of questions structured into sections and subsections relating to the different areas of requirements and evaluation criteria.
2. Each question and section is given a weighting which defines the significance of that element to the overall evaluation.
3. Bidders (potential suppliers) provide answers to the question within a defined time period.
4. The buyer reads answers from all suppliers and awards scores
5. Weightings are applied to the scores, and total scores calculated to find the supplier that best matches the buyer's needs.

How does software help with running an RFP?

Documents, Spreadsheets and Email

Information technology is used to a greater or lesser extent in the management of all Request For Proposal projects. The most manual approach is to draft an RFP document in a Word Processor which defines the buyer's requirements and indicates what information the bidders should include in their proposal. This document might be posted as a hard copy, downloaded from a website, or sent by email.

The problem with sending out a document describing requirements and criteria is the bidders will respond with proposals in very different formats. The buyer must then study each proposal in order to extract the information required to do a rigorous comparison. This is time consuming, error prone, and risks some information being lost.

The next stage of sophistication is to structure a Word document as a questionnaire, distribute this document to bidders, and ask them to type in answers in the appropriate spaces. This avoids the problem of proposals coming back in complete different formats. However, it still requires the buyer to read through each document awarding and writing down scores in a different place. In some cases it is possible to use a Spreadsheet instead of a Word document. In this way questions can be structured row by row, the respondents can answer in an adjacent columns, and scores and weightings can be logged subsequently in the same document.

Using spreadsheets, documents and email can be fine for simple Request For Proposal projects. For bigger projects, problems soon become apparent:

• Accuracy
  • Answers are spread across multiple documents, while scores must be consolidated in the same document for comparisons and charting. This introduces significant scope for copy and paste errors
  • Calculations to derive total weighted scores soon become surprisingly complex (especially in a high structured RFP with weightings applied at section, subsection and question level
• Audit Trail - In many regulated environments, especially in public sector procurement, buyers are required to document every step of their decision making process. This is very difficult to achieve when the evaluation is based on numerous document spread across dozens of emails.
• Team Working - with documents and email it can be very difficult for more than one evaluator to work in parallel when assessing and scoring bids

The Role of RFP Software

In the 1980s, accountants in small companies would often use spreadsheets for their book keeping, tax calculations and annual accounts. It quickly became apparent that the process of accounting was more or less identical between companies, and therefore rather than each company creating their own spreadsheets with different formulas it made much sense to use a standard accounting software package.

In a similar way, RFP software (or rather erRFx software) does not do anything that is not possible to do offline. Rather it formalizes the process and makes it possible to handle a much higher volume of work.

EventSupplierSelect - Hosted RFP Management Software

EventSupplierSelect has been designed to reduce the administrative burden of running a sophisticated, rigorous RFP project. All information is aggregated in the same place. It's a web based, hosted service, so both buyer and bidders can access it through a web browser. It incorporates many rules to help comply with procurement guidelines. Questionnaires of any shape or size can be drafted online, answered online, and scored online. Multiple scoring sets and multiple weighted sets can be built, and scores recalculated with a single mouse click. Bidders can register online and use the service for free.

To learn more about EventSupplierSelect try the tour of rfp software features.