Should You Ever Bypass an RFP Process?

Over on The Strategic Sourcerer, there's a useful post that examines when it might make sense to bypass an RFP to better engage a list of potential suppliers or bidders for a project. But is there ever a place for breaking with the routine RFP part of a strategic sourcing process? Perhaps. Consider recent supplier behavior in services industries where the post suggests that "suppliers are walking away from business rather than participating in a process that requires a great deal of upfront work (often with strict timelines) and little upfront customer engagement" in part because stretched "sales teams have become selective in reviewing what business opportunities look real and which are long shots, and allocate resources appropriately."

So perhaps in the current climate it does make sense to avoid RFPs in certain circumstances, at least if you want to maximize potential competition. But what's the alternative approach if you go down this path? The Strategic Sourceror suggests that he's recently "started looking for opportunities to shift away from formal RFP's and utilize supplier presentations as the initial qualifier during the sourcing process." These types of presentations, which "have traditionally been reserved for the later stages of the sourcing process," can add quite a bit of time to the upfront process, the post suggests. But it's possible to avoid engaging dozens of suppliers in presentations before a potential bid or RFP by "mapping out exactly what your requirements for the new supplier are in advance of any meetings" and making sure those that you do select are all strong potential candidates.

In my view, this type of approach may make sense for one-off or highly customized services. But when it comes to most of what an organization buys, I'd still argue that the more you can specify upfront exactly what you're looking for, the better chances are to define a specification so as to achieve the best possible savings and result relative to waiting for suppliers to attempt to compete on their own playing field rather than one that is more level based on your own unique set of requirements. Having said that, I'll be the first to admit that my firm does not respond to RFPs because I view what we do on the services and advisory side as a very specialized niche. But hopefully I'm not being too much of a hypocrite in looking at this situation.

- Jason Busch