Tony Corrigan, founder and CEO of TenderScout, recently spoke at the 15th Annual APMP Conference. This is a portion of the presentation he made at the event.
We’re all used to the headlines, now appearing on an almost daily basis, warning of the apocalypse to come (some might say here already) when machines take over all the jobs and make human workers redundant.
Whether the robots are going to pay tax, or have rights, is still to be decided and what humans will do with all their free time is something sociologists and economists are frantically trying to figure out. But there is an accepted view that an unstoppable rise of R2-D2s are on their way to do your work.
All of which is very bad PR for the machines, and obscures their many sterling qualities that can help us old school human prototypes make our jobs easier and earn more money.
In our world of tendering and government procurement, this point really hits home.
Public tender contract opinions
We’ve all encountered the inertia that businesses feel towards competing for public contracts. My conversations with bid consultants and buyers over the years have often centred on the frustration both sides feel over the fact that many robust and professional SMEs are not competing for a pipeline of opportunities that represent the biggest pot of revenue on the planet.
Feeling the fear… and then letting the machines take care of it
It’s a little unfair to speak about inertia when what I really mean is fear.
This year, my team and I have so far spoken to 714 SMEs, primarily in the UK, Ireland and the US. Overcoming the fear factor is the biggest part of our job to convince these SMEs that they could win tenders.
Why more companies don’t bid for tender contracts
Apart from the 10% cohort who are engaging with tenders, whether in a strategic or ad hoc manner, the fears are:
- 30% are too busy and see competing for tenders as an onerous task
- 20% see tenders as not worth the resource and effort required to compete
- 30% feel intimidated by the process
- 10% don’t trust that their proposal will get a fair hearing
The perception SMEs hold of the whole tender process exists as an amorphous mass in their minds. In general, they feel that no matter how much time, money and resource they invest in creating a tender process for their business, the effort will be wasted as they’ll never win.
This fear paralyses action. Bad news for all of us as we miss out on working with companies that could win contracts and bring value to their businesses and communities.
The machines can fix this problem and empower these companies.
So the machines could actually be the … goodies?
The way to overcome the fear SMEs feel towards tenders is by replacing the unknown with information, and this is where the machines come in.
As a generalisation, buyers:
- Create tenders without engaging the market first – so SMEs can’t be sure that the buyer knows what the options are
- Create ambiguous, confusing documentation – so SMEs don’t know what the buyer is looking for or how much they will spend
- Provide minimal information around outcomes – so SMEs receive a one page rejection with no lessons to implement after investing weeks of effort and money in compiling a proposal
Buyers hold all the cards and have an expectation that because they’ve got the business to offer, SMEs should just be grateful to participate in competing for tenders. Or this is the perception at least.
Addressing the information deficit gap immediately puts more power into the hands of SMEs, and this is done in two ways.
- Technology to systematically gather relevant information (e.g. tenders, awards etc.)
- Intelligence to analyse that information
This way the SME is no longer acting in a fog when engaging with tenders.
Understanding when to compete for a tender and when to let a tender opportunity pass without competing for it is key for SMEs to feel empowered, reduce their proposal costs and increase their win rate.
How to decide on what tenders to bid for
For SMEs to make informed bid or no bid decisions, they need to understand how their business rates on:
- Their solution or product to fulfil the tender requirements
- How they stack up against their competition
- Their own value proposition
- The timescale for the tender
- The size of the opportunity in relation to their business
- The budget
- Knowledge of the buyer
- Knowledge of how much of a need the buyer has to procure the services or products they are tendering for
Sourcing and collating this information is impossible to do without technology.