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RFP Do’s, Don’ts and Alternatives

  



In today’s agile business environment, the Request for Proposal (RFP) can seem like an overly cumbersome process for vetting call center outsourcing vendors. In our article, The Blind RFP, we described how RFPs are often blasted out to vendors indiscriminately. Let’s expand on this conversation with a more holistic analysis on what’s wrong with RFPs, what’s right with them and alternatives to the traditional RFP process.

Let’s Start with Some Interesting Numbers…

We surveyed dozens of call center outsourcing clients and vendors across industry segments and deal sizes. We asked a few simple questions about their views on RFPs, and our findings paint an interesting picture:

  • While 62% of call center outsourcing clients say that they must rely on RFPs to source new vendors, 60% say that they’d prefer to avoid doing RFPs altogether, and 78% say that they’re open to alternatives to the traditional RFP. 
  • For their part, 72% of vendors view the RFP as an often painful but unavoidable way to compete for business. In fact, 68% of vendors prefer not to respond to RFPs, even as an incumbent vendor. 
  • Half (50%) of vendors say that they will not respond to an RFP if they don’t have a relationship with the client, and 10% say they will not respond to RFPs as an incumbent or a new vendor.
  • In a perfect world, RFPs would be open, fair and transparent, which is not always the case. Still, 45% of vendors say that RFPs allow them to at least “get in the mix” even if their chances are slim.
  • And while 56% of vendors suspect that finalists are usually preselected before an RFP is even released, only 10% of clients submit that certain vendors are heavily favored before an RFP is sent.
  • How much thought and detail really go into developing RFPs and responses? Forty percent of vendors say that the RFPs they receive from prospective clients are repetitive and poorly written, and 53% say that procurement and vendor management are not always aligned.
  • Similarly, 54% of clients report that most RFP responses they receive are cut-and-paste jobs; 62% say they find grammatical errors in the responses; and half say that the RFP responses are sales fluff and lack creativity.
  • Over half of the vendors surveyed suspect that clients go right to the pricing page of the RFP response, and almost one-third (30%) of clients admit that they do not read the responses from cover to cover. 

Keep the Status Quo or Change It?

If clients’ and vendors’ perspectives regarding the RFP are as unfavorable as our survey indicates, are we OK with business as usual? Unless we adopt more creative ways to evaluate vendors, it looks like the default RFP will remain ubiquitous in our industry. 

The call center industry has evolved over the past two decades, yet too many RFPs today still follow outdated practices. For example, the compilation of the “RFP list” is often put together without much prequalification. We’ve encountered clients who search on Google for call center vendors, and boom—they end up on the RFP list.

What purpose does this serve other than giving the “RFP list compiler person” bragging rights about how many vendors they “got” for the RFP? This approach is about quantity, not quality.

Padding the list with random vendors decreases your chances of finding the perfect match.

Look at it this way—if you were looking to fill a key position in your company, would you interview all candidates whose resumes you received? Of course not. You’d screen them carefully and only allow the best-in-class and most qualified to make your short list. So why include unqualified call center vendors in your RFP without proper screening, vetting and scrutinization? 

The RFP Process Needs a Revamp 

The issues that both clients and vendors have with RFPs are symptomatic of a deeper problem with the process itself. Most RFPs follow this format:

  • Gather a list of vendors, often without much prequalification
  • Email the RFP to each vendor
  • Get responses back (quite often encyclopedia-sized)
  • Go right to the pricing page, skim other pages
  • Select short list
  • Do site visits
  • Pick vendor(s)

Is this the best we can do? A mechanical and impersonal RFP process does not give vendors an opportunity to get creative or to provide a 360-degree view of their services. Clients often complain that too many RFP responses are cut and paste jobs. Well that is true because vendors will cut and paste responses when each RFP they receive follows the above process, and the RFP itself is a derivative of another RFP, which is a derivative of yet another RFP.

To come up with a more beneficial solution for both clients and vendors, let’s first delve a little deeper into the what, when and why of RFPs.

When Do You Issue an RFP? 

Most organizations issue RFPs for the following reasons:

  • Procurement Mandate—Corporate rules require that all contracts must undergo competitive bidding.
  • Contracts Expiring—When existing vendor contracts are coming up for renewal, clients often administer an RFP to explore options.
  • Performance Issues—Dissatisfaction with current vendors.
  • Nearshoring/Offshoring—When clients want to migrate from U.S.-based call centers to nearshore or offshore, an RFP with a global focus can be a useful process.
  • Migrate from In-House—When clients want to outsource for the first time, they might issue an RFP as their primary vetting tool.
  • Carve-Outs/Build Operate Transfer (BOT)—RFPs are often required when a client is considering a carve-out, which is a model that welcomes vendors to bid on taking over a client’s existing call center(s) or co-manage centers.

Why Are RFPs Needed?

As much as the RFP is maligned, it has many advantages and if implemented correctly, RFPs can help in identifying the right outsourcers. 

The following are several reasons why the RFP can be useful:

  • Hidden Vendors—Helps companies to discover stand-out vendors that outshine the competition.
  • Stakeholder Vetting—Satisfies most/all functional areas, influencers and decision-makers.
  • Governance—Fulfills procurement, purchasing, vendor management, contracting and other corporate mandates.
  • Find Yourself—Can help the client company to better understand its own needs.
  • “Borrow” Ideas—Clients can learn about new and better processes.
  • Test within a Test—The RFP is a test in project management; e.g., Can the vendor follow instructions, listen effectively and meet deadlines?
  • Competition—Creates healthy competition among vendors; could lead to improved metrics across the outsourcing channel.
  • Champion vs. Challenger—Puts current vendors “on notice” that challengers are vying for market share of outsourced volume.
  • Price Comparison—Helps organizations understand current market prices in comparison to what they are paying.  

Common Challenges with the RFP Process 

The RFP is without a doubt, resource-intensive. Clients invest a lot of effort into the process, yet often overlooked is the effort required on the vendor’s part to respond.

Given the resource and time commitment and previously mentioned flaws with the process, it’s understandable that many vendors can become frustrated when faced with the common pitfalls associated with RFPs. The following are some of the reasons why RFPs get a bad rap:

  • The Preselection Blues—These occur when the RFP is viewed as a formality because one or more vendors have been prechosen or heavily favored.
  • Padding the RFP List—The RFP list is comprised of vendors without any forethought or pre-vetting, to meet a phantom quota of RFP respondents.
  • State of Readiness – No sense doing an RFP or a vendor search if the organization isn’t ready yet to undergo the process and engage new vendors.
  • We Need More Questions—Overloading the RFP with irrelevant questions will only make responses that much longer. Keep it simple.
  • I Know a Vendor— Usually akin to knowing “of” a vendor. What is your experience with the vendor? Have you worked with them? Been to their sites? Pre-qualified them? At too many organizations, folks who don’t have an intimate knowledge of the call center/BPO landscape “throw in” vendors that lack the credentials to realistically compete and win the business.
  • Relationship Avoidance—When clients refuse to get better acquainted with potential suitors in advance of an RFP, it is a disservice to all involved.
  • The Dreaded Leverage—If the incumbent(s) has a better than 95% chance of surviving, then the RFP is an exercise for leverage. Why not skip the RFP and just demand better pricing and services from incumbents?
  • Mutual Vetting—Elite vendors often want to vet potential clients to confirm that the opportunity is a good fit. This should be embraced, not frowned upon. Selectivity (not arrogance) is a good sign in a vendor.
  • Scoring Process—Often RFPs provide specific selection criteria, yet the selected vendors don’t measure up.
  • Anyone Reading This? —Does every stakeholder read every RFP response cover to cover?
  • The Radio Silence— Vendors who invest in the process deserve a timely response, whether they’re selected or not. Clients often drag out communication or leave vendors hanging altogether.
  • Small Deal Overkill—Best-in-class vendors may opt out of long RFPs if the deal size is too small. It’s better to match the size of the RFP with the size of the deal.

Alternatives to the Same Ol’ RFP

As an industry, we continue to implement RFPs the way that they have always been done. Does this mean that we should still use workforce management practices or ACD technology from the 1990s? If we can adapt to changing processes and technologies, then we should also be capable of adapting to newer and better vetting practices.

We don’t have to default to the same old way of doing things. A better approach is to isolate the components of the RFP process that work effectively and combine them with newer and better methods of vetting talent.

For example:

Speed Dating

Gather your short list of vendors and send them a brief RFI—Request for Information, requiring basic info. Next, schedule a video conference that poses a series of additional questions to the vendor. Give them a maximum of 2-3 minutes to respond verbally to specific questions. The questions could range from basic to situational (e.g., “What would you do if ____?”).

This process helps clients to put faces, voices and personalities to the vendors’ responses. It also tests the vendor’s ability to articulate services and solutions in an unfiltered and unrehearsed way.

Using this approach can also help the client to judge whether the vendor’s participants are all on the same page. Are they authentic? Are they answering questions naturally and with confidence and verve? Or do they lack conviction?

Pre-RFP Meeting

Once you’ve collected a short list of vendors, invite each vendor to visit you in person for a pre-RFP meeting. During the visit, the vendor will get to immerse themselves in the client’s call center (if internal), process, culture and way of doing things. Post-meeting, administer an RFP so that the vendors can respond intelligently based on a more informed understanding of the client’s requirements.

A Call Center SAT Test

Instead of an RFP, create an SAT-type test that asks the vendor a series of “what-if” questions. It’s best to narrow your list of vendors first. Then, brainstorm internally to develop a series of situational questions that will help to extrapolate the “inner vendor”, instead of the typical gloss and shine responses. For example, “What if you are staffed at ____ agents and your service levels are _____ when they should be ______? What is your process to take corrective measures, and who is responsible for executing your plan and communicating with the client?”

Scope of Work

Send a short list of prequalified vendors a scope of work (SOW) describing your business needs in detail. Then ask each vendor to come up with a freehand creative response to your SOW. Provide vendors with a few required guardrail questions so that responses follow a consistent format, however, let the vendors determine how they want to respond and what additional information they feel it is necessary to include.

A Site Visit RFP

Conduct the bulk of your RFP questions at the vendor’s site. Start by sending your broader list of vendors 10 questions maximum and come up with a weighted score for each question depending on your key selection criteria. Then, after scoring their responses, schedule site visits to your down-selected vendor(s). Take stakeholders to the site visits, and plan on spending 1-2 days at the vendor site. Set the agenda for the visit and send the vendor a more detailed list of questions that you want answers to on-site. This process enables the vendor to “show you,” not just “tell you” how they operate.

A Reverse RFP

Yes, this sounds counterintuitive but why not? In traditional RFPs, the Q&A process allows vendors to ask questions. The RFP captain at the client compiles the questions, obtains answers and provides the vendor with a codified Q&A. So why not make this the RFP? Allow a short list of vendors to ask no more than 10 questions each about the client’s business needs, then provide a proposal to the client. Clients can evaluate vendors on the types of questions asked and the strength of each proposal received.

Video RFP

Allow vendors to produce their own videos instead of responding to a list of RFP questions. Give vendors the opportunity to create a five- to 10-minute video that tells their unique story. Allow the vendor to get as creative as they want within the framework of the client’s guidelines on required topics, suggested topics and parameters on the length of the video.

RFP = Request for (Fill in the Blank)

In the end, if all the stakes are on the table, and all other boxes are checked, what are clients really looking for in a vendor today? Culture, transparency, innovation, follow through… I could go on.

The call center industry has undergone a profound transformation during the past two decades—emerging into a highly visible touchpoint representing the human face of the brand.

More care and attention need to be paid to the process for identifying and selecting a vendor partner that is the best match for an organization’s mission, vision and values. It is a distinctive role, which demands a more unique, creative approach to fulfill—perhaps we should think of it as a Request for People… or Passion… or Personality.

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As a call center outsourcing thought leader and president of CustomerServ, Nick Jiwa is dedicated to helping companies find, select and retain the right call center outsourcing partners. Nick’s expertise and contribution to the call center industry started in 1986 – as a call center agent when the industry was still in its infancy. An avid 80s music buff, proud father and soccer fanatic, Nick is passionate about “anything call center”, giving back to the community, mentoring and helping others win.

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