The five commandments of successful proposals – ep 16

How to use proposals in a strategic way for higher conversions

If there is a massively underrated sales tool, it’s proposals. This article is a primer for doing them better. The proposals you send are important assets that get read by several members of the buying committee. A bonus: unlike most marketing collateral, proposals receive much more attention, so it’s vital that they fit your strategy. In this episode. we teach you quick fixes that make a big impact on your win rates.

The good news is that the advice we’re about to share here is trivial. Yet, only 5% of the proposal-processes we come across get it even partly right.

Ever since we started working with technology companies – who typically work in a project set-up – we’ve been tickling new clients with these two ideas:

» What would happen if you won 15, 20 or even 40% more projects thanks to better proposals?
» How would people in the company feel if you could reject the not-so-sexy work and only work for great companies on exciting projects?

So, the stakes are not just about winning proposals at a higher rate; they’re also about becoming a better place to work for your people… and being more profitable simultaneously.

By reading this article (5-8 minutes) and correcting mistakes (a couple of hours?) you will immediately start seeing results. You will be harvesting low-hanging fruit that you may have not been aware of.

Two true stories

To make things more tangible, here are two real cases. Both drew attention to a scandalously large shortcoming on our vendors’ side, while at the same time revealing our blind spots in our own proposal process. Here are the two cases:

Request for quotation to build a marketing process

We specified a marketing process that we wanted to have built via an agency. They would have used custom coding and / or marketeing automation software to build a complex funnel involving video, email and text messages.

We made a flowchart of the process along with text descriptions. I even added a screen video that verbally explained the dreamed-up process. We sent this “package” to 18 marketing agencies. Several actually congratulated us on the high level of detail in the specification.

The result: 7 proposals and 5 “I have more questions” response emails. In the end, 10 proposals had landed in our inboxes. You’d think that if anyone, marketing agencies would know how to put together catchy and irresistable proposals. Well, think again.

Some agencies had good questions and they would have probably delivered the solution on time. What was surprising was that without much prior knowledge about our company or business purpose, almost half the companies clearly put a lot of time and effort into crafting a proposal.

Very few of the agencies asked the basic questions: when we plan to decide on the vendor, what the budget is, how it fits in a larger business-context, whether we prefer automation software or custom development… all the information that would have revealed whether they have a 2% chance of winning the RfP, or 82%. They were pouring hours into this proposal blindly.

There are some other blunders these agencies have commited that you may have spotted. We’ll get back to these but for now, let’s move on to the other case.

Request for quotation for the building of a cloud-based BI/controlling system

We were building a financial forecasting-controlling system for a previous business of ours. We had decided on Zoho Creator (a good choice) and were looking for a suitable expert on Upwork. We discussed the plan and idea in calls with multiple Zoho developers and agencies from India to Indiana.

There was a supplier who stood out from the rest during the personal consultations – they were professional and friendly, and also quite convincing. We were almost certain that if he quotes a good price, they would be the winners, because their PMs and sales people were professional and easy to communicate with. They were asking the right questions, providing value in calls – it all felt very smooth and “right”.

When this team sent their proposal and we were opening the pdf with great anticipation, the smile froze on our faces. And not because of the price. The price was actually fair. What amazed us (in a bad way) was this:

The first 5 pages of their 13-page PDF was all about them. They polished their own experience and merits so eloquently that I barely noticed our company in the document… whereas, in principle, the project is about us, our problems and challenges. Sure, our company was “in there, somewhere”; the first piece of information specific to us appeared on page 6.

On this page, the proposal devoted all of two paragraphs to proving that they grasped our business problem.

The fancy-pants offer didn’t even attempt to prove that they were interested in our success — there was a total lack of empathy; they did not outline a vision of what we could achieve with their solution. Sure, the features that would be developed had been listed, but we were left wondering whether they even understood our problem.

Showing empathy in the form of communicating that you understand your customer’s problem and the greater vision your solution will enable, is a non-negotiable piece of a proposal.

While reading the offer, I felt like in the barber shop I’d gone to years ago, where the barber wasn’t asking how I wanted my hair cut; he just asked what length to cut… and then started clipping away, while talking about what stylist competitions he had won.

This haircut cost me 10 bucks and it isn’t a big risk, it can be corrected quickly… (just shave the thing!) An IT development project, on the other hand, requires more caution. This service provider with the great sales people lost our business; we just weren’t confident that they really understood the situation and the greater goals.

The RfP was eventually won by a more introverted entrepreneur whom we didn’t feel particularly strong about in the preliminary conversations, plus his proposal was nowhere near as flashy as many of his other competitors’. Black and white text written in Arial with many bullet points.

Do you know what this provider did differently? The first part of his offer was about the customer. About us. He proved he understood the problem. He outlined a vision of what we will be able to do with the system he has developed, how our operations will change, what risks we will prevent.

The company only spoke about its merits at the end of the offer – to the extent that it is of interest to offer-readers: in short, to the point. So, what are the quick wins, what should you focus on first, when revamping your proposal-process? (Because it is a process, as you’ll see, not just a pdf.)

The five commandments of winning proposals

1. Don’t send a proposal

What?! The first commandment of writing proposals is not to even write them? Yes. At least, not when they ask for it. After all, I ask: how can you responsibly make an offer for a project that hasn’t been planned-out? The first step is to understand the business / technical environment and then plan the project, which then needs to be priced.

It is fashionable to do this audit or planning phase for free, but fortunately it is becoming common practice in more and more industries – quite rightly, as it is only so fair – that the design is paid for separately. In most projects, it is only after a specific survey or audit that a plan can be used to diagnose and cure a hand.

One of Blair Enns ’favorite parallels to the opposite of the above case in healthcare is that the patient tells the doctor that his appendix hurts and asks for an offer for appendectomy. A doctor who operates without a diagnosis will lose his license (perhaps even his freedom) very quickly. That would be absurd, right? Yet it is an everyday practice in business.

Ergo: You can only give a quote for planning, but it’s a relatively quick and painless thing. And the plan itself will include the cost of construction. In Hungarian, they pay for conscientious bidding. No more free advice.

2. You shall present the proposal

You send an offer. You have hit “send”. And there is no answer for 3 days. You write to the prospect. Nothing. You call after 5 days, he doesn’t answer. 12 days pass. Painful silence. Familiar? It shouldn’t be.

That is why we do not send a proposal in writing first. We always start with a conversation. You should never send your proposal in writing prior to having discussed it with the prospect because

» you don’t see their reactions
» you don’t have the chance to clear up misunderstandings and objections immediately, on the spot
» they’ll look for the price right away (you do that too, right?) and they won’t have the context

The discussion of the plan and the bidding should take place orally (in person or on a call) and should not take the form of a presentation, but rather a conversation, discovery, and feel almost like a workshop. In the end, when you have the right context and everyone understands everything, communicating the price can happen. There, you have the chance to clear up misunderstandings, answer questions on the spot and

agree on the next meeting or step when the decision happens.

If the buyer is unable to make a decision on the spot, we will arrange another appointment in person on the spot, at which point the buyer will make a decision.

3. You talk about money early

This commandment seems to contradict Commandment 2, but it does not. Draw attention to the need to clarify the approximate expense with the client at the beginning of the dating process. The client may order the plan for 3,000 euros, but if the 20-30 thousand euros of the implementation far exceeds his budget, then he is not sure that he wants to order the plan from you. It is an ethical thing to prevent such later misunderstandings.

4. You offer at least two payment options

The psychology behind this commandment is that you want to shift the internal dialogue of the prospect from a “yes or no” dilemma to an “either-this-or-that” one. You can do this by offering two or three terms for payment or by having max. three packages of different value. Don’t have too many options (keep it under 3) becasue more options lead to analysis paralysis.

5. The hero of the proposal is the buyer

The proposal (which you present in a conversation, along with the plan, right? See commandments 1 and 2)) should primarily be about the buyer. You can make the customer the protagonist and position yourself as the guide, by showing empathy; by proving in your conversation (a.k.a. “presentation” which isn’t really a presentation, as discussed above) and written proposal that you understand their business/technical problem, its consequences, and are able to put your solution in a broader context.

You understand the vision they want to achieve and how your solution affects key business/technical metrics to contribute to that greater vision.

There are quite a few more nuances to master proposals, but if you only implement these obvious things, you’re expected to:

» create fewer proposals unnecessarily;
» win at a higher rate
» charge more.

Oh, FAQ ?!

Here are some objections we encounter upon to hearing this advice for the first time.

Oh, you don’t understand – our industry is different. No one would agree to doing “oral proposals”.

The short answer: if you properly communicate how this policy serves the interests of the buyer, then the majority of buyers will understand and agree to not receiving a written proposal before conversing with you.

And if they insist on sending the proposal in writing first, so they can “review and prepare properly” for the meeting?

Then just submit the plan and other contents in writing, but not the quote itself. If this is a deal-breaker, or if the buyer is unwilling to put energy into planning and meetings, we tend to pass the opportunity on to other suppliers.

These are fair rules that are in the interests of both parties – and it is not worth working with those who continue to force an asymmetrical model (to the disadvantage of suppliers).

What if we are unable to reach the decision-maker? If we only have contact with an assistant who collects the bids?

If we are unable to discuss the merits with the decision-maker and make an oral offer, the above-mentioned scenario will take effect: we will simply pass the opportunity.

We would only go into a “blind bid” if we knew we had a competitive advantage over the others – if we knew they wanted us and the RfP was just a formal element.

These are relatively simple changes that will fundamentally impact the outcome of your proposals. There is no need for new software, no new investment; just re-design your existing thinking and processes around proposals.

Literature used:

Enns, Blair: Win without pitching manifesto
Faulkner, Jennifer: How to write a business proposal
Miller, Donald, and Callahan, Koula: Proposals made simple

Want Better clients and more impact?

Klear helps tech and consulting companies get great clients.
Let's talk about how this can work for you.

More Growth:

Register for the Live Sessions

Tuesdays 11 AM ET, 5 PM CET