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The Relationship Between Proposal Organization and Win Rates

How you organize your proposal function can have a big impact on your ability to win. Should your proposal group be part of your marketing, sales, or operations groups? You can find examples of each. But most companies arrive at their organizations by the accident of availability instead of through any real strategic planning. The way you organize your proposal efforts will affect the perspective brought to your proposals, and ultimately will affect your win rate. So how do you know which perspective is right for your type of company?

Where you put the proposal group depends on how you want your organization to approach winning. Your approach to winning depends on the nature of your offering, and your strategic approach to marketing and sales:

  • Commodity businesses base their sales efforts and proposals on well-defined line items, while solutions oriented businesses have to engineer a different offering for each proposal. Commodity businesses usually compete on price and supplier qualifications, while solutions businesses compete on price, approach, value, and qualifications.
  • Product companies tend to submit quotes based purely on quantities and options, while service companies need to define the scope as well as the price. Product proposals are about defining the specifications and options, in order to describe the corresponding benefits and price. Service proposals are about understanding and accommodating needs.
  • Government contractors have specific format, content, and contractual requirements to incorporate, while private sector businesses may have little or no guidance or rules to comply with. Government proposals are about compliance and evaluation score, while private sector proposals can be about anything.
All these factors impact your approach to marketing, sales, and proposals. To determine the right approach to organizing the proposal function at your company, consider:
  • Who gets involved in closing the sale? Do you need operations/fulfillment staff involved before a sale closes (which is normally the case for solution sales and non-commodity services) or can sales take orders on behalf of operations/fulfillment?
  • Are your marketing messages part of your sales closing strategies? This will depend on how the company views marketing. If at your company marketing is just the department that enforces the logo rules and places ads, then they won’t have much to contribute to the proposal. If marketing at your company means strategic positioning and messages, then their involvement will be based on how much winning the proposal depends on those messages.
  • Who has the most customer contact and owns the relationships? Depending on the company, this could be marketing, sales, or operations. In service/solutions businesses, relationships rule. In product/commodity businesses they may or may not.
  • Who do you want to lead the effort? If you want your closing driven by marketing messages, then the proposal team should be led by your marketing department. If you want the sales group to own the closing process, then they should direct the proposal. If you want customer relationships to drive the closing, then the proposal should be led by whoever owns the customer relationship. Even with a cross-functional team, you can get very different results based on who leads the proposal.
You should also consider what you want to drive your business:
  • If customer needs are what drives your business, then the proposal effort should be organized to be responsive to them. Understanding customer needs is usually the job of sales, but it can also rely on the customer relations and subject matter expertise in operations.
  • If competition drives your business, then your proposal effort needs to reflect the strategic positioning defined by marketing.
  • If capability development drives your business, then while some businesses associate that with operations, the proposal effort should be implementing the messages required to pursue the strategic marketing plan.
  • If cost efficiency and low prices are what drives your business, then the proposal effort need to be close to operations so that what is proposed can be delivered at the lowest possible price.
  • If operational success and reputation are what drive your business, then the proposal effort needs to be driven by operations to ensure successful fulfillment and performance.
  • If sales volume is what drives your business, then the proposal effort needs to be driven by sales.
  • If revenue, or better yet profitability, drives your business, then your first instinct will be to organize the proposal effort around sales, but if follow-on sales are important, you should also consider how that will be achieved by operations after the sale.
Everything can’t be equally important. The nature of your offering and what drives your business, along with your strategic goals will make some things more important to your business than they are to other businesses. Tradeoffs are inevitable. That’s what leads some organizations to attempt a matrix or other variation on the traditional hierarchy.

What we’re really talking about is what kind of culture and values you want your proposal group to have. What should they think is more important: winning, price, message, post-award performance, capability development, beating the competition, making the customer happy, or something else? If you could only pick one to be the most important, which would it be? How you organize the proposal group will help influence their priorities and goals. And that will influence your win rate.


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By Carl Dickson, Founder of CapturePlanning.com



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