When companies work together to create something innovative, an RFP is never involved. RFPs are issued for commodities and mature processes that have been around a long time. On rare occasion, a completely new, perhaps disruptive, process is created and the customer sends out an RFP for execution of parts of the process. In each of these cases, the supplier is told exactly what to do and how to bid. The customer is asking how much will it cost me for you to fit into this box?
For most services and a lot of goods, RFPs are harmful to both the customer and the supplier:
- The customer, who knows less about the service/product category, is dictating solution parameters to the suppliers, who know more about the category
- To create an RFP, a scope of work or product spec has to first exist. When the RFP is issued, the SOW/spec is either old, hastily crafted by the customer themselves or crafted well by a consultant at a high price.
- Suppliers each have unique product and delivery attributes but hide or spin them to match what they think the customer is looking for.
It seems weird that customers issue so many RFPs if they are unhealthy for everyone involved. But it is not the customers’ fault that RFPs are used so much – it’s the suppliers’ fault. [Read more...]