About once a year or so, I like to take the opportunity to remind procurement professionals to do your part and help cut down on a serious problem that is plaguing businesses. Each year, potentially thousands of hours are wasted and hundreds of trees are killed in order to support this old fashioned business practice. Of course, I am referring to RFP Spam.
This year, the reminder to rant about this topic came courtesy of a very large Oil company, who sent in an unsolicited RFP, and I use the term RFP very loosely. In fact, what we actually received was an email with a sentence asking for pricing to our generic info@ email box, with an attachment titled “xxxx current services RFI.docx”. The attachment itself was an unformatted job description that was obviously written by the incumbent provider that outlined all of the functions that they performed on a daily basis. The details of the RFI/RFP itself where missing (such as deadlines, expectations, requests for information about the supplier, etc.) it was simply a two page job description. To their credit, the procurement professional took the time to do a find/replace of the contractors name with “THE PROCUREMENT SERVICES CONTRACTOR”.
So, what is RFP Spam?
Simply put, RFP spam is the process of sending out unsolicited RFPs that do nothing more than create paperwork and process. RFP Spamming will not produce any positive results for any party involved. Buyers and procurement professionals are wasting the small amount of time and effort that they put into them, and suppliers will either be upset that they have to respond or will simply refuse.
Well, we’ve outlined RFP Spam it a few times in prior articles:
And we have a whole chapter in our book about it (and how to put an end to it):
But simply put, it almost always happens for a small handful of reasons:
In many of these cases, those buyers or stakeholders have already selected a supplier but are required via. their own internal (or government regulated) processes to ask three suppliers to bid. Often, the buyer or stakeholder simply asks the selected supplier to write the RFP for them, so that in the small chance that another company decides to respond, they still don’t have a chance at winning the business (as the RFP will always be crafted to show the answers of the incumbent in the best light).
Although the RFI we just received in the mail was on the comically bad side of things, even the ones that a bit more effort attached to them would be unlikely to motivate us to respond. Suppliers, especially good suppliers, have a sharp eye for what a real opportunity looks like. Even if you're not interested in using them now, a half-hearted effort will only turn them off to future potentially engagements as well (when you might actually need them).
So if you think your organization is “doing strategic sourcing” because you take things “out to bid”, think again. There is a lot more to supplier engagement, the RFX process and the sourcing process as a whole. A generic “three bid process” ultimatum within your organization will produce very minimal results. It’s an easy process to game, and unless your management team has the time to audit everyone’s work, it’s completely ineffective.
This year, the reminder to rant about this topic came courtesy of a very large Oil company, who sent in an unsolicited RFP, and I use the term RFP very loosely. In fact, what we actually received was an email with a sentence asking for pricing to our generic info@ email box, with an attachment titled “xxxx current services RFI.docx”. The attachment itself was an unformatted job description that was obviously written by the incumbent provider that outlined all of the functions that they performed on a daily basis. The details of the RFI/RFP itself where missing (such as deadlines, expectations, requests for information about the supplier, etc.) it was simply a two page job description. To their credit, the procurement professional took the time to do a find/replace of the contractors name with “THE PROCUREMENT SERVICES CONTRACTOR”.
So, what is RFP Spam?
Simply put, RFP spam is the process of sending out unsolicited RFPs that do nothing more than create paperwork and process. RFP Spamming will not produce any positive results for any party involved. Buyers and procurement professionals are wasting the small amount of time and effort that they put into them, and suppliers will either be upset that they have to respond or will simply refuse.
Well, we’ve outlined RFP Spam it a few times in prior articles:
- Stop RFP Spamming!!!
- What not to do with an RFP – Rant
- Don’t Let Your Suppliers Write Your RFP
- RFP, a Tactical Solution
And we have a whole chapter in our book about it (and how to put an end to it):
But simply put, it almost always happens for a small handful of reasons:
- Improper training of the sourcing group
- Over reliance on e-sourcing tools and technology
- Lack of resources
- The false belief that your company is special (and everyone wants your business)
- And by far, the number one reason RFP Spam comes out….
Because it’s required because of some business process in your organization that requires a 3 bid process.
In many of these cases, those buyers or stakeholders have already selected a supplier but are required via. their own internal (or government regulated) processes to ask three suppliers to bid. Often, the buyer or stakeholder simply asks the selected supplier to write the RFP for them, so that in the small chance that another company decides to respond, they still don’t have a chance at winning the business (as the RFP will always be crafted to show the answers of the incumbent in the best light).
Although the RFI we just received in the mail was on the comically bad side of things, even the ones that a bit more effort attached to them would be unlikely to motivate us to respond. Suppliers, especially good suppliers, have a sharp eye for what a real opportunity looks like. Even if you're not interested in using them now, a half-hearted effort will only turn them off to future potentially engagements as well (when you might actually need them).
So if you think your organization is “doing strategic sourcing” because you take things “out to bid”, think again. There is a lot more to supplier engagement, the RFX process and the sourcing process as a whole. A generic “three bid process” ultimatum within your organization will produce very minimal results. It’s an easy process to game, and unless your management team has the time to audit everyone’s work, it’s completely ineffective.
Post A Comment:
0 comments so far,add yours