Five KPIs for your RFP process

As we usher in the new year, it's the perfect time to recalibrate our approach to Request for Proposals (RFPs). Whether you're kickstarting your RFP process or fine-tuning an established one, the key to success lies in the Key Performance Indicators (KPIs) you track. In this post, I'll share essential KPIs to consider and encourage you to identify the unique ones that resonate with your team and industry.

KPIs to Track

RFP Go/No-Go Ratio

This ratio helps assess your team's ability to identify and pursue viable opportunities. It's not just about the numbers; understanding the reasons behind your response choices can uncover potential product gaps and inform future strategies.

Strive for a balanced ratio – not too cautious, but not overly ambitious.

Win Rate

This KPI is a direct indicator of your team's effectiveness. A very high win rate might suggest a lack of risk-taking, while a low rate could mean time is being wasted on unlikely wins.

Aim for a 50-70% win rate for a healthy balance.

Customer Acquisition Cost (CAC)

This KPI helps evaluate the financial efficiency of your RFP bids. It's crucial to balance the cost of bidding against the potential gains.

Consider investing in quality enhancements like document design, video production, or relationship-building travel if the opportunity size warrants it.

RFP Quality Score

This metric provides invaluable insights into how your proposals are perceived by clients, helping you gauge and improve the quality over time.

Time to Close

Understanding the length of the RFP cycle assists in more accurate forecasting and sets realistic expectations about the process's length.

Setting Up Your KPI Tracking

Establish a straightforward method to monitor these KPIs, whether through a CRM or a shared document. Regularly review them quarterly and adjust your strategies for continuous improvement.

A Note to Team Leaders

Remember, your team will focus intently on these KPIs. It's crucial to convey that their value isn't solely defined by these metrics. For instance, a proposal writer shouldn't be overburdened with an unrealistic number of RFPs, while a salesperson's performance might be more closely tied to the win rate. Define and communicate what success looks like in your context, understanding that the metrics you prioritize will drive actions and decisions.

TL;DR:

Identify the KPIs that matter most to your RFP process, track them diligently, review regularly, and be ready to adapt for ongoing improvement. Here's to a successful 2024 in mastering the RFP game!