23 Aug RIP RFP? QBS OMG!
We get it. Companies aren’t necessarily versed in how to choose an outside agency for advertising, marketing, or strategic consultation. And government entities are often required by law or bylaw to put out a Request For Proposal (RFP), even if they already know who they want to hire.
But that doesn’t mean there’s not a better way to go about the search. (SPOILER ALERT: There is.)
More on that in a minute. First, let’s talk about why the RFP needs to die a horrible death, or at very least, stop sucking so much. Sure, it might work if you’re looking to buy pencils, park benches, or those Styrofoam packing peanuts that make opening shipping containers so much fun, because all you want is to have X amount of Y delivered by Z for as little $ as possible. But when you want creativity, innovation, and high value in the form of real business solutions, the RFP is a POS.
Quite often, RFPs are vaguely written because companies just don’t know what they’re looking for. Which is understandable. If you’re not in the advertising and marketing biz, then how do you know what your options even are? Even the most well-crafted RFPs are just guessing at what variables are needed. They ask agencies why they think they can deliver these variables and for what price.
In other words, it comes down to price. You’re not fooling anyone.
Believe it or not, agencies know that cost is always the biggest issue, and craft their responses with low price in mind. Creativity, innovation, and value goes bye-bye, because they want to win the bid, and know the folks in procurement are probably just going to flip to the last page of the proposal, the one with the dollar signs.
So while you may be HOPING to find an agency with the right advertising and marketing expertise who is able to deliver complex, high-value, custom solutions that will perfectly match your needs, all you’re REALLY DOING is kicking the tires and asking “how much?”
At the end of the day, you want quality. So why ask for X and a price? Why not instead look for an agency that can show that they are the most qualified to apply their thinking solutions to my problem and fix it.
Enter Qualifications Based Selection (QBS). It’s a process the US government established in 1972 for the public sector to use in selecting architectural and engineering services for public construction projects. Because you get what you pay for, and nobody wants to drive their truck across the cheapest bridge in America.
The process goes like this: Firms submit qualifications to a procuring entity who evaluates and selects the most qualified firm. Once the firm is selected, then negotiations begin for the scope of work, schedule, budget, and fee.
Makes sense, right? Of course it does. In fact, you probably already use QBS when hiring staff.
Think about it. When you need to hire someone, you probably start by figuring out the job requirements first. This then allows you to determine a salary range for the position, with room for variance based upon experience. Next, you’ll probably post an ad somewhere, and then screen all of the responding candidates based on their qualifications.
Yes, qualifications. You have a budget (salary range) in mind, but you are only interested in narrowing down your field to the most qualified candidates. That short list will be the people you interview, allowing you to better assess their experience and qualifications, and see if you have any chemistry with them or if they creep you out. Through this process, one candidate will probably rise above all others, and that’s the one you offer the job to.
But they don’t have to take your offer. They may feel that they can bring more to your business, and be able to back this up with a solid argument. Now you’re negotiating price, looking to arrive at a figure that will make everyone happy. How about that?
This same process should be applied to an agency search. Once you find the best agency with the best qualifications and chemistry, tell them you want to work with them and begin negotiating. A budget has already been established and shared, so it comes down to deliverables and opportunity. That’s QBS, baby!
Don’t be afraid to negotiate. Agencies WANT you to.
Let’s just say you choose the most qualified agency to partner with (an agency should always be a partner, not a vendor!). You reiterate to the agency that your budget is $100K for this project, and ask them what kind of value they can offer if you spend $110K with them. Is it a 30% value? Ask them, what if we feel like we should only spend $80K? Can we have a conversation about these scenarios? In the process, you’ll learn more about what your options are, and what the costs and benefits are for each. At the end of the day, you’re going to arrive at the best combination of costs and services from the best qualified agency.
Agencies are easy. We want to work with clients that want to work with us. The rest is all details. Ultimately, the QBS process leads to more accurate pricing, fewer surprises, and more well-defined expectations on all sides.
This is how you get good value. This is how you get creativity and innovation. Save your RFP for the Styrofoam peanuts.
We’ll dig further into the RFP process itself in future articles. In the meantime, leave a comment below if you have any questions or suggestions for future topics.