The Tender Trap

 

Hi there!

 

This week’s subject might be considered a little controversial…I’ve taken a departure from the norm and instead of writing about 360 degree feedback or behaviour I want to write about the tendering process. And what’s wrong with it! For larger buying organisations, especially in the public sector, there has always been a tendency for suppliers to be selected on the basis of their submitted response to often comprehensive and demanding bid documents. And this trend appears to be spreading to mid-tier organisations.

 

For larger supplier businesses, putting together a tender is usually done by a team of people well-versed in the process and highly practised. For smaller supplier businesses however, this puts a great deal of demand on limited resources and rejection is taken very personally.

 

But even that is not the real beef that we have with the current system. Having spoken to dozens of smaller consultancies in the HR and L&D space, we are all pretty much agreed that so often we are being asked to propose a solution to the WRONG problem! A so-called expert inside the buying organisation has been tasked with a project to deliver x, y or z and that person has worked out what is needed from an organisational development perspective and then worked with someone in procurement to prepare the bid document. It is even possible that an incumbent supplier has been involved in that process as well! Not exactly a level playing field. So the diagnostics are done and the tender specification is written. Interested parties have either been invited to bid or they’ve seen a notice of the opportunity and we all now scurry around trying to make our bid the smartest of the lot and the best value to boot. But like the patient who presents to the doctor with multiple symptoms, the underlying cause of the problem can often be far from the obvious. Extensive examination and diagnostics are required before a treatment plan can be put together.

 

So this month’s vlog is a big plea from one of the little people!

 

The real experts in organisational psychology are more likely to be found running their own consultancies. They’re writing books, making videos, presenting keynote speeches at professional conferences, etc. So, if you want your project x, y or z to have a transformational outcome, why not start the tendering process with the examination and diagnostic stage. You won’t even have to spend time and effort on the delivery specification…that can’t be determined until after the examination and the diagnostics are complete.

 

As the buying organisation, you simply outline the symptoms that you face in as much detail as you can and invite potential suppliers to submit a proposal as to how they would go about determining the root causes of the problem. Phase 1 of the project if you like. The best, most cost-effective examination and diagnostic process is then what you are judging in the tender. Whether you get identical investigative processes described in suppliers’ tender responses, or very different ones, you simply shortlist those companies whose responses you are drawn to and then invite them in to pitch. Be sure to avoid those bidders who feel confident enough to propose a solution at this stage. There may be potentially different solutions which can only be revealed once the examination and diagnostics are done. The successful bidder then gets to carry out Phase 1 of the project.

 

So how does this approach signify a step forward in the tendering process and does everybody win? Well think about it: from the buyer’s point of view there is much less research and investigation required before the tender document can be written. Potentially difficult conversations with key stakeholders to uncover the underlying causes of the problem can now be managed by the successful bidder, with the real likelihood that the answers given will reveal more than could have been found internally. In fact, we would be amazed if - as the buying organisation – you didn’t find at least one supplier bid whose response didn’t teach you something you didn’t know (that’ll probably be the one that wins!). You still have the choice to go out to tender once more for the delivery (solution) phase (Phase 2 if you will) using the detailed specification that has been drawn up from the results of the Phase 1 diagnostics, or you may simply offer that to the successful Phase 1 bidder. Your choice.

 

How does the supplier win? First and foremost, I am reminded of the Irishman who was stopped by a passing tourist and asked for directions: “Well, if it was myself, I wouldn’t be starting from here!”. So we wouldn’t be dancing to the buyer’s tune, we would be writing our own music. We stand or fall on our ability to diagnose organisational psychology, and our savvy when it comes to organisational politics! Only experts need apply. The bid document would surely take less time and effort to complete, as we tend to broadly follow the same diagnostic approach whatever the symptoms. The resource allocation for both buyers and sellers would be lower.

 

If you like what you’ve read, more than ever before I invite you to comment below. Let’s get a real conversation going…maybe even a petition to the CBI – to Parliament! Why not?!

 

Thank you for reading,

 

Colin Newbold