321—that’s how many RFP submissions the average enterprise-sized company (10,000+ employees) will make in a year, according to a survey of 500 companies in Loopio's RFP Management Benchmarks and 2020 Trends report. That’s almost one RFP every day of the year.
It’s easy to assume that larger companies submit so many RFPs because they have more resources—but the answer isn’t so cut and dry. In fact, our research shows that the number of people enterprises have contributing to RFPs is the same or less than companies much smaller than they are: enterprises average 7 people per response, while companies ranging in size from 100-5,000+ people average anywhere from 7.3 to 8.3 people.
So, how do enterprises keep up exponentially higher volumes of RFPs with nearly the same amount of contributors of much smaller companies? And does the volume of RFPs impact proposal quality or win rates?
In this piece, we’ll explore the unique challenges enterprises face when it comes to proposal management. Plus, research-based insights on how top-performers are winning more bids.
Is Submitting More RFPs Better? Balancing People, Process & Win Rates at the Enterprise
Large companies submit an average of 321 proposals per year for enterprises, while the overall average for companies of all sizes is just 147.
But does submitting more benefit them (and their bottom line)? The answer is, in most cases, yes: the research indicates that companies who submit more bids win more. This makes sense since enterprise organizations have the highest average win rate at 53%. (Smaller companies vary between rates of 44 to 52%).
So, how are enterprise companies submitting so many responses when they involve fewer people in the process than their smaller counterparts? (They include an average of 7, which is the second smallest group out of all other company sizes.)
It could be that having fewer people involved makes the process faster—meaning enterprise-level proposal teams are able to tackle more RFPs.
However, our research shows that organizations that involve more people in RFP creation tend to have higher win rates. This is likely because various areas of the business are contributing diverse expertise to each RFP and improving its quality. Those with processes involving 15+ people are 8% more likely than average to have win rates in the 70-79% range.
How do enterprises involve the same (or fewer) people in the response process—but maintain RFP quality?
How Enterprises Keep RFP Quality High
There are several other factors that make consistently crafting high-quality responses possible according to the research:
1. RFP Software Usage
Enterprises are more likely to invest in tools like RFP software. On average, companies using RFP software respond to an average of 152 RFPs annually, while those without respond to only 103 RFPs.
Software can also minimize collaboration headaches—which 50% of companies with 10,000+ employees consider to be one of their biggest challenges.
RFP software streamlines collaboration, with features like a library of approved content, automation of tedious RFP tasks, and project workspaces for tagging others and tracking approvals. Since those who rate their tools as ‘Extremely Effective’ are 10% more likely to use RFP software, this could be helping larger organizations manage stakeholders and subject matter experts throughout the RFP process—thereby making it more efficient.
2. A Dedicated Proposal Team
Our research shows that those with proposal teams tend to feel their process is more efficient, are more likely to complete more RFPs, and more likely to report they are ‘very satisfied’ with the quality of their RFPs overall. Interestingly, 48% of enterprises have proposal team members owning the RFP process.
Despite their tools and dedicated teams, enterprises still take longer to complete RFPs than any other group. But does speed impact proposal quality and win rates?
Enterprise RFP Submission Timelines: The Impact of Velocity on Proposal Quality
From start to finish, enterprise proposal teams have an average submission timeline of 28.2 days.
While taking longer to write proposals may sound efficient, research shows that when more time is invested in writing RFPs the outcomes are better: companies with 80-99% win rates are more likely to spend 61+ hours writing RFPs. And those that report having a higher percentage of overall sales revenue sourced from RFPs are 7% more likely to spend 41 hours on each RFP.
Interestingly, enterprises are 25% more likely to track their submission timelines compared to other company types. However, knowing that longer timelines are in fact good for RFP win rates, enterprises may want to focus their performance tracking elsewhere.
Key Areas of Growth For Enterprise RFP Management
For RFP teams, metrics matter. There’s a positive relationship between tracking revenue and the percentage of RFPs won: 68% of those who win more than 70% of their RFPs track overall revenue. This is in stark contrast to 36% of those who win less than 40% of their bids and don’t track their revenue.
However, large enterprises face real challenges when it comes to data tracking. Globally dispersed teams, silos, and top-down management can be huge blockers when it comes to accurately analyzing how to improve RFPs.
Here are a few trends in metrics tracking that can positively impact proposal quality and outcomes:
1. Disconnects with Senior Leadership Must be Addressed
Our research shows that while 80% of executives feel ‘very satisfied’ with the quality of their RFPs, only 16% of associates feel this way.
Regarding timelines, executives report being ‘very satisfied’ with the time it takes to complete an RFP, while only 12% of associates are. Executives are also 10% more likely than others to say that their team responds to all of the RFPs they receive—meaning they may believe it’s happening when it isn’t.
For leaders to truly understand RFP performance, they need to align with employees on the frontlines who handle RFPs. Improved metrics and alignment between staff and management could bring these disconnects to light much earlier. It also ensures leadership truly understands the challenges their teams face, so they can make more informed decisions regarding RFP tools, process, and resources.
2. Employee Satisfaction Should Come to the Forefront
It’s worth noting that respondents who are ‘very satisfied’ in their role are 15% more likely to report that their company is tracking revenue and team performance metrics. And, the research also linked higher employee satisfaction to better RFP quality.
Ultimately, it is in every executive’s best interest to not only improve metrics tracking, but proactively share results with their employees to keep morale high.
It’s worth noting that only 23% of companies actually track RFP team member sentiment. To improve RFP quality, enterprises should look to understand what will keep proposal teams motivated and inspired (and that begins with tracking).
Enterprise RFP Trends for 2020
Looking ahead, 60% of enterprise respondents say their company plans to increase the number of RFPs to which they respond in the coming year.
So while enterprise companies currently dominate the RFP market with submissions, large companies should continue to focus on quality, not speed, and be vigilant in addressing issues surrounding employee morale and collaboration.
Involving diverse expertise in the RFP response process improves outcomes, so it’s imperative that enterprise companies improve how they tap into internal experts to respond to RFPs, and ultimately win more business.