1. Bidding for software contracts
Fiona Pearson, CEO CliniSys

2. Introduction 25 years in the software industry Started as a programmer
Business manager at Logica for 14 years
Managing director of three software businesses:
Data analysis for the world’s airlines
Software integrator in telecoms market
Clinical applications for hospitals worldwide

3. Bidding is only one part of the sales campaign
Prospect
Who has need?
Qualify
Do they have funding?
Will they proceed?
Position
Develop relationship
Prove credibility and capability
Beat competition
Bid
Pre-sales
Demo
Explain product
Reference site visits
Agree contract
Formalise discussions and offer
Non-sales people often think it is all about the bid – because this is the visible portion. Relationship building, understanding, building trust

4. Get involved in bidding - good experience and exciting
Increase commercial awareness Understand customer’s perspective Broaden knowledge of your company’s products and services Meet different teams in your company Opportunity to shine Broaden knowledge of your company’s market Puts your development work into context

5. To-day’s bid
CliniSys Solutions Ltd. Develop laboratory information management systems (LIMS) Our new product has been proven in 1 hospital – but there is still some outstanding development required We receive 1,000 page tender, we have three weeks to respond
Everyone very busy, tight timescales to get first solution complete
Most bids, tight deadlines, late bids are not read
Divide class into tech team, all working on the project, bid manager, sales team, Terry and Simon – FD and commercial director

6. Timetable

7. What is the first question to ask?
Did we know this tender was coming? Are we speaking to the customer?

8. Qualification
Bids can often cost more than 5% of contract value (small bids could cost as much as 20%) 1:3 is a good hit rate Do we have time and effort to bid? ‘No bid’s – never win business
Discuss fact, company very busy – must get product right, word gets around if you no bid

9. Qualification questions
How well do we know the customer? Do we understand his real requirements? Who are the competition? Is there an incumbent? Does the customer have budget? Has the procurement been approved? Do we have a solution which meets the requirements? Are the customer’s timescales realistic? Are the commercial terms acceptable?
Tender document often written by a contractor or copied from a neighbouring hospital, so may not totally reflect their requirements
Timescales not realistic but sales team think they can change this
First reading commercial terms seem OK but reserves right to change his mind

10. Bid strategy Why will Hillingdon hospital want to buy from CliniSys?
Being technically best will not win us the business
This is what differentiates good sales people
What does the customer really want
Persuade the customer we have it
Sales team drive this – if not it will be the solution the techies want to deliver

11. What benefit is the customer looking for?
Most software projects are intended to deliver a benefit
Cost reduction
Increase in productivity
Improved safety or accuracy
Improved quality
Identify the desired benefit
Not always what is stated in tender documentation
How will it be measured

12. Listen to customer needs
Often bid team too quick to tell customer what they want False assumptions are made Requirements altered to fit bid team’s desired solution

13. Know your customer
Who are the actual decision makers, not always who it seems.
Easy to spend all time with IT department selling them technie stuff but rarely the IT department who makes the decision. In this case it is the clinical director and the FD who has the veto. However IT dept like us and are feeding us useful information about the requirement and the competition – bid manager is taking note of and feeding into solution.

14. Hillingdon Hospital Benefits
Improve turn-around times for test results which reduces patient bed-time Improve reporting service to GPs Enables multiple labs to consolidate to reduce costs Provide CEO with benchmarking data to compare each lab’s performance

15. What is the 2nd question to ask?
Can I have an extension?

16. There is never enough time
Understand requirement
Design solution to meet requirement
Software; our product, third party product, bespoke development
Hardware; servers, PCs, peripherals
Network
Estimate cost of solution
Effort to develop
Effort to deploy
Which licence modules required
Cost of hardware and third party software
Plan deployment
Work packages, timescales, which skills
Dependencies on customer
Assess risk and cost contingency
Write proposal
Prepare contractual response
Gain internal approvals
By definition never finished

17. Bid Timescale
Taken three days to qualify and agree bid strategy – almost one week of three weeks gone

18. You get extension – 1 week
Not what you asked for but you take it gratefully

19. Bid Management
Essential to have a detailed bid plan Run a bid like a project Get the right people on – fast! The deadline cannot move Expect to work week-ends and nights Allow time for review and iteration Allow time for document production and delivery
In a very short space of time, a bid manager has to collect a group of people who can tell him exactly what the customer wants, can design a technical solution within the customer’s budget which meets his requirements, can assess how much it will cost and how long it will take, can review all of the risks, can bring everything together in a clear and coherent document, satisfy the commercial department and remember to sell the solution to the customer

20. Put together high level plan, take last week-end for production, allow two days for iteration following bid review.
And at the moment you do not have a team
You now have 12 working days to produce the solution and create a winning proposal

21. Bid Reviews Essential Objective and independent Avoid costly mistakes
Experienced check
Is the level of risk acceptable?
Most companies have bid review checklists
Use this to support your bid planning
Why bother with bid reviews as they take so much valuable time

22. Extract from our bid checklist

23. Replacement oil delivery system
‘Our system will do everything your current system does…’
Bid price: £800,000
Final cost: £3,250,000

24. You now have a bid team and work can start
Not full time and you keep losing people to the project
You now have a bid team and work can start
You now have 10 working days to produce the solution and create a winning proposal

25. Solution Development
Problem: We need to design a £1m solution to meet Hillingdon’s requirement in three weeks. Answer: Base solution on similar projects and focus on what is different and what are we going to do about it.
Crazy – it would take several months in the project. We can only do this if we know what we are doing.
Other bids, talking to customer and worked up a solution beforehand with customer

26. Specify Solution Clear unambiguous statement of requirements
This will form part of the contract
Can each statement be tested?
Avoid user friendly, future proof,…
Clear set of performance measures
How fast, under what conditions
But remember you are still selling

27. You sold what!
Explain benefits but do not make claims we cannot deliver

28. Avoid promising the undeliverable
CliniSys’ software saves lives CliniSys’ software reduces time in hospital by 10% CliniSys software will track all reported hospital infections and alert the nurses as to which beds may be infected

29. In a chance discussion with the sales guy, you learn that the system also needs to cover the community lab
You have 4 working days left, the solution needs a major change, you have no estimates and very little of the bid has been written

30. Customer Management
Keep discussing during the bid Test ideas Make sure results of conversations are fed back into the bid Keep sales team integrated with bid team
Sales team need to sell the solution, feed them with the key points, sales team need to let technical team know asap of any changes

31. The Proposal Companies will have templates and guides for proposals
You may need to follow customer defined structure
It is a sales document
‘Storyboard’ the proposal
Ensure it follows the bid strategy
Key themes are understood
Extensive use of pictures (relevant)
Avoid excessive use of boilerplate
Ensure it is an attractive document and easy to read
Most important section is the executive summary

32. Typical Contents
Executive Summary Understanding of Requirement Proposed Solution Benefits of Solution Company Capability Implementation Plan Support Services Pricing Contractual Response
Check exec summary – count how many times company name, how many times customer name

33. Preparing Estimates
Licences – modules, users, locations… Effort to deploy licences Effort to develop new modules, interfaces… Cost of hardware, PCs, peripherals, network, data centre Cost of third party software, databases, interfaces Timescales, team size, skill mix

34. Preparing Price Estimates drive cost Price driven by:
Level of profitability
Level of contingency
Financing charges
Inflation allowance

35. Getting paid
When How much Currency Taxes Payment from invoice Validity

36. The legal stuff
Obligations and consequences Indemnities Warranties Liabilities You will need legal advice as only used if in dispute

37. Bid Review
Doesn’t go well, the FD and commercial director want to put profit and contingency in which take price above customer budget. Salesman is convinced that we cannot win the deal at that price. Stand-off – what can we do

38. Imaginative approach required
Chips are down, this is when you earn your salary and the salesman’s undying gratitude because you realise that you can re-use the configuration for the main lab in the community lab and save three months of effort bringing the price back into budget – but depends on salesman selling approach to customer – you give him benefits of same system, less training, consistency of approach

39. You were still printing at 6am this morning, you had to cancel the couriers and take it in yourself.
You delivered the bid with one hour to spare.

40. What happens next?
Nothing Short listed Demo’s Reference site visits Revised submissions
Bid team goes to sleep for two days, except dev team who are behind on their work and need to work extra hard to catch up

41. Document all agreed changes and keep proposal under change control
Quotes can get out of control at this point – they ask for so many options you are no longer sure what combination they will order for how much
Customer wants us but cannot afford it, so loads of questions to get price down. Salesman pushing hard and offering lots of options – he is being difficult to control.

42. We have been awarded the contract