Wednesday, October 27, 2010

One reason to bid, even if you won't win

When considering whether to pursue an opportunity, it is obvious that all potential opportunities are strategic and of the highest importance. Allow me to explain.

All opportunities can be divided into two categories. The first category is when we are pursuing an opportunity with an existing customer. In that case, the opportunity is obviously strategic, because it is imperative that we retain this customer, no matter the cost.

The second category is when we are pursuing an opportunity with a potential customer. In that case, the opportunity is obviously strategic, because it is imperative that we win this customer from the competition, no matter the cost.

Sounds simple, right?

Actually, there are cases in which a bid that is otherwise unattractive may be pursued for strategic reasons. The Proposal Guys have listed five potential scenarios (four of which are justifiable) to pursue a bid on strategic grounds. I'm not going to discuss all five of them - you have to go to The Proposal Guys post to see all of them. But I'd like to look at their third scenario, market penetration.

In this case, a vendor has a new product, or is pursuing a new territory, or is doing something else that is new. "New" is the key word here, for reasons that the Proposal Guys explain a little later. How do you let the world know that you're out there?

Well, after you've set up your Facebook and Twitter accounts, the possible next step is to pursue an opportunity in the "new" area, even if your chances of winning are not optimal. As the Proposal Guys put it:

We need to be seen as “players” and hence taking part – even if we don’t win – is key to building relationships and establishing our brand in the new area.

And you can definitely build relationships by pursuing this tactic. Perhaps the customer has a bidders' conference, which you as a bidder can now attend. The customer will be there, the competitors will be there - and other interested parties will be there. Perhaps a knowledgeable subcontractor will be there, or a powerful prime contractor, or some suppliers, or some consultants. Perhaps the customer may have hired a consultant. Any of these people may remember that you were there, and that you are now a player in this industry. And they may contact you the next time an opportunity rolls around.

There's another benefit that the Proposal Guys didn't explicitly state in this post, but I'm sure they've said it elsewhere. There are benefits for your organization from participating in a new type of bid. The changes in my job in the last couple of years have allowed me, as well as many other people in my office, to participate in opportunities that I had never encountered before. We've learned a lot about new markets and new customers, and this knowledge has provided us with benefits as we continue to pursue opportunities in this area.

However, as I mentioned above, there is one caveat. This strategy of pursuing opportunities that you otherwise wouldn't pursue only works when the whole thing is new. Or, as the Proposal Guys put it:

And we’re in stages one or two of the three-stage journey in customers’ inevitable progression from viewing us as “new, interesting and creative” to “we know they’re serious contenders in this market” to “they’ve been trying for ages and they never win – they’re risky”.
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