Business Development

CMMI Ltd Bid Support

This page identifies a generic bid process. This process is very similar in most organisations except some best practice templates are deployed to aid efficiency as part of the CMMI Ltd consultancy service in conjunction with a risk process. It is disappointing to invest expenditure in a bid you are unlikely to win. Likewise it is not profitable to win a bid that ultimately costs more to deliver than estimated in the response to tender.

Proposals

For each enquiry a Bid Leader will be appointed who will be responsible for processing the proposal, throughout the Proposal life cycle, namely:

  1. Receipt of an Invitation to Tender.

  2. Bid/No Bid Decision

  3. Preparation of the Selling Price

  4. Proposal Approval

  5. Proposal Submission

  6. Proposal Distribution

  7. Post Submission Activities

  8. Contract Award

  9. Activities in the Event of a Lost Bid

CMMI Ltd is highly experienced in the need to produce quality responses to aid an ITT and can serve to provide the necessary support.  This can include producing.

  1. Bid data base

  2. Bid Review Checklist

  3. Initial Risk Review

  4. Bid Kick of and approach

  5. Bid Schedule

  6. Excel Bid Cost Calculator

  7. Word Document on Proven Template

  8. Requirements Breakdown

  9. Estimate/Price to Win

  10. Proposal Submission

  11. Proposal Distribution

The above templates are available only through the consulting service

Receipt of an Invitation to Tender

Any Invitations to Tender received must be forwarded immediately to the appropriate Bid Leader who will be responsible for all activities up to and including Contract Award or Loss. The Invitation to Tender will, on receipt, be recorded on the bid database and all the relevant customer information collected. The bid data base poses high level questions to ascertain if the bid is worth perusing. If so move to undertaking the Bid Review Checklist this further review will again assess if all the ITT documentation is comprehensive and the questions that need to be asked of the potential customer. Remember in some instances the customer may be prepared to contribute towards the bid cost if you ask.

Bid/No Bid Decision

Allocate the bid team and the Bid should now be up and running and verbal contact made with the potential customer. If the risks are financially high you may decide at any time if you want the work, remember the risks may be more than the penalty clauses specified as realised by BP. Following the internal distribution of a customer Invitation to Tender, the Bid Leader, if it is deemed appropriate, will call an initial Bid/No Bid meeting at the earliest opportunity. The representation for this meeting will normally as a minimum involve:

  1. Bid Leader

  2. Product Team Lead who will undertake the work should you win

  3. Marketing including the key players in the bid team

  4. Contracts

  5. Procurement

Other areas and potential suppliers will be consulted as deemed necessary by the nature of the Invitation to Tender.In addition, for bids which are deemed to be of a strategic nature, an executive sponsor will be identified and invited to attend. There are some instances that loss leaders are considered to be strategically advantageous for a company to get into a new market place.

If a Bid/No Bid meeting is held, the decision will be recorded utilising the criteria on the Proposals Bid/No Bid form. A formal risk review will be held addressing the requirements in the risk review check list. Following on from a decision to bid, the Bid Leader will produce a Bid Plan detailing the win strategy/themes to be adopted and any relevant information already produced from the Business Assessment and Venture Planning stages and decision gates, along with associated time-scales for the receipt of responses from the relevant parties for their contributions to the response to the Invitation to Tender.

The potential risk of not winning a bid has to be balanced against the cost required to construct the proposal, ie., cheap proposal with a low chance of winning or high cost proposal for a must win situation. A budget for the bid needs to be established. During the life of the proposal the decision to Bid must be continually reviewed and the Proposal Bid Plan amended accordingly.A No Bid decision is better sooner than later and must be approved at the appropriate level, no lower than the relevant Bid Manager, and the Bid Team formally notified.

The Bid/No Bid meeting will also establish the extent of any sub-contract involvement. It will be the responsibility of Contracts to liaise with the relevant Procurement area to ensure a flow down of Terms and Conditions from the Invitation to Tender to any suppliers. In the event of a No Bid decision being made, the Bid Leader will raise a letter advising the customer of this fact. This letter should be written in a manner which will not damage, and should seek to enhance, the Company's future opportunities.

Preparation of the Proposal

The Bid Leader should hold a bid review/approval meeting to identify

  1. Bid/No Bid Decision.

  2. The Competition.

  3. Proposed Strategy and schedule

  4. Sub Contract Arrangements.

  5. Winning Themes.

  6. Proposal Organisation and Responsibilities.

  7. Proposal Contents and Format.

The output of the meeting will be minutes on the meeting in addition, the schedule will identify all key input dates and actions necessary to submit a proposal on time, (including the level of attendance at any available Bidder's conference) together with all key review/approval meetings. Typical responsibilities during the preparation of the proposal will be:

  1. To determine that the technical requirements are fully understood and can be achieved and to define the Work Breakdown Structure.  Action: Product Team.

  2. To provide market intelligence on the competition and customer budget and likely winning price. Action: Marketing.

  3. To establish the financial viability and credit rating of the customer. Action: Business Administration

  4. To confirm resource availability, to assess the resource implications associated with the proposal and to identify resource succession plans in the relevant Project and Support. Action: Product Team

  5. To assess and establish teaming arrangements.  Establish confidentiality and Teaming Agreements. Action: Proposals/Marketing/Contracts/ Product Team

  6. To collate and review in-house man-hour estimates. Action: Proposals/Product Team

  7. To determine sub-contract strategy and obtain and review sub-contract quotations. Action: Proposals/Product Team/Contracts

  8. To confirm man-hour rates. Action: Proposals/Business Administration

  9. Provision of programme and resource profile. Action:  Product Team

  10. To assess Terms and Conditions Action Proposals/Contracts

  11. To assess and quantify the technical/programme risk. Action: Proposals/Product Team

  12. To assess and quantify the commercial risk. Action: Proposals/Product Team/Contracts

  13. Prepare Proposal Tender. Action: Proposals/Product Team

  14. Prepare Selling Price. Action: Proposals/Business Administration

Following receipt of an Invitation to Tender, all communication with the customer will be through, or as specifically delegated, by the Bid Leader. This will include all requests for further information or clarifications, requests for extensions to the submission date and negotiations with the customer. Regular review/approval meetings will be held throughout the Proposal preparation process as required by the particular enquiry. These will normally be chaired by the Bid Leader.  The minimum level of meeting should include a review of the Proposal draft and a final Proposal Approval Meeting. For small proposals with a quick response time, formal meetings may not be practical. These will be processed at the discretion of the Proposals Manager.

The date and venue for the final Proposals Approval Meeting will be included in the Bid Plan. It is the responsibility of all interested areas to ensure availability of a representative at the appropriate level of approval.

The Bid Leader will be responsible for proposal budget control. This includes the raising and closing of Cost Centres and Work Packages for this activity in accordance with standard Company practice.

Preparation of the Selling Price

The Bid Leader is responsible for preparation of all price information supported by Business Administration, Projects, Procurement, Contracts, Marketing and Product Definition as appropriate. Prime cost estimates (man-hour and sub-contract) will be provided to the Bid Leader in accordance with the requirements and time scales detailed in the Bid Plan.

Where applicable, the costs associated with the use of customers equipment or premises must be included in the prime cost estimates. Any costs for alteration and subsequent reinstatement to its original condition after use are also to be included in the prime costs estimates.

The Bid Leader will calculate the selling price(s) from the prime cost estimates. The calculation will be recorded in the excel bid cost calculator. The Marketing should be able to provide intelligence or information if available, regarding competitors and expected market price levels for the project, within the overall Proposal Time scales. The Bid Leader, supported by the Product Team Manager has the responsibility to challenge all costs in order to enhance the Company's competitive position.

Proposal Approval

Prior to the submission of the Company's Proposal in response to an Invitation to Tender, it is essential that the appropriate level of approvals are obtained and recorded on the Proposal Approval Form. The commitment/approvals required are:

  1. Product Team - confirming man-hour estimates, ability to carry out the work and resource availability.

  2. Product Team - confirming acceptability of sub-contract quotations with respect to price and compliance.

  3. Product Team - confirming acceptance of the proposal (cost estimates, programme and resource availability).

  4. Contracts - confirming acceptance of contract Terms and Conditions.

  5. Business Administration - acceptance of any special financial arrangements.

  6. Proposals - A Proposals Manager, or delegated representative, will confirm that the proposal is consistent with the TPA and approve the proposal for submission to the customer.

For proposals of high value a Tender Price Approval may be required from Senior Management, Corporate Risk Management and Insurance Department and the Contracts Department. Proposal Price Approval is subject to agreed discretionary levels.

Variations to contract that have a price implication to the customer are instigated by Projects but Proposals are consulted with regard to tender pricing. Depending upon the value and perceived risk of the variation, see below, Proposals should then either take the price variation through its tender pricing procedure or give guidance on the actions to be followed by Projects.

Proposal Submission

The Bid Leader will be responsible for ensuring the proposal is submitted to, and received by, the customer before the final submission date. In the event that the Bid Leader becomes aware of circumstances which will lead to late submission of the proposal, action is to be taken to minimise the delay and to agree a revised submission date with the customer.  In some instances it may be considered prudent to deliver the proposal just prior to the cut of date or time. In these instances bids consisting of large documents should be couriered by a specialist firm or internal courier.

Post Submission Activities

The Bid Leader is responsible for maintaining contact with the customer after submission of the bid and for negotiating the bid into an acceptable Contract supported by other areas as necessary. This post-bid contact is essential to demonstrate the companies commitment, to obtain intelligence regarding the customer's perception of the bid and to allow additional work to be initiated to improve the company position. The Bid Leader will consult with, and employ, the Marketing Department to support this activity.

When a proposal is resubmitted the principles of this procedure will be maintained including the Proposal Approval Procedure. When any aspect of a proposal is changed during negotiations with the customer from that for which corporate approval has been received this alteration is subject to the same approval as the original tender response.

Contract Award

On receipt of a Contract, Purchase Order or Acceptance of Tender, the Bid Leader, supported by the Product Team Manager, will conduct an initial review and, if acceptable, forward the Contract, together with a completed Contract Hand over Note to the Contracts Department for formal hand over and acceptance.  If the Contract is unacceptable, the Bid Leader, support by Contracts, Business Administration and the Product Team, will negotiate with the customer to obtain a satisfactory contract.  If it becomes apparent that a satisfactory Contract cannot be agreed then Contracts will formally reject the contract on the Company's behalf.

Where applicable the Bid Leader will ensure that all hours included in the contract price allocated from the Proposals Budget are recovered by electronic transfer of costs.  A priced copy of the Proposal and associated ruling documentation, together with a detailed breakdown of price information, will be forwarded to the Product Team. 

It is importance that intelligence is gathered regarding winning proposals.  The lessons to be learned will be summarised by the Bid Leader and actions for their implementation agreed with the appropriate Proposals Manager.  These will be discussed with the departments involved in proposal preparation

Activities In the Event of a Lost Bid

The Bid Leader will communicate the result to all departments and any subcontractors involved in its preparation. The Bid Leader, supported by Marketing, will contact the customer to determine the reason for its unacceptability.  This may be pursued by formal debrief.  This will include evaluation of potential customers comments on the bid, price differential, quality of proposal and name of the winning Contractor.  It is often prudent to see if your skill sets are of value to the winning Contractor.

The lessons to be learned will be summarised by the Bid Leader and actions for their implementation agreed with the appropriate Proposals Manager. These will be discussed with the departments involved in proposal preparation. A review of the feedback form unsuccessful Tenders will be undertaken periodically by the Senior Proposals Manager in order to determine the lessons learnt and to identify trends and any corrective measures to be implemented.