Anatomy of a public sector RFP
In the final episode in the Fall Webinar Series for Clients, we reviewed the findings of the 2019 State of the RFP, an annual benchmarking study of the public sector RFP process.
Using data from over 6,000 public sector RFPs with a combined spend of $1.4 billion, this report gives us a glimpse into how a typical RFP process unfolds.
Read on for a quick summary, or download the full State of the RFP report here.
How long is the average RFP?
The average public sector RFP is 116 pages. This varies somewhat by organization type.
The average RFP for a K12 school district is significantly longer. At 150 pages, it’s over twice as long as the average RFP for a higher education institution.
The RFP process adds up to a lot of paper: around 8,000 pages a year for the average public sector organization.
How is the average RFP set up?
Public sector RFPs on average ask for five distinct pieces of data/documentation from vendors. This might include forms, examples of past work, certifications, references, pricing information, or other documents.
Proposals are typically evaluated on eight criteria.
The average RFP evaluation is divided into two to three different evaluation stages. The purpose of these stages is to manage the complexity of the evaluation, by dividing different types of proposal content up for individual review.
The most common structure of evaluation stages is:
- Mandatory stage, consisting of pass/fail criteria, evaluated by the procurement team
- Technical information, evaluated by internal Subject Matter Experts (SMEs)
- Pricing information, evaluated separately by procurement, finance, or internal SMEs
Advantages to using evaluation stages include the ability to:
- Allow unique groups of evaluators to review only the proposal content that is relevant to their expertise, saving time
- Avoid bias by evaluating pricing after the rest of the proposal review
- Improve confidentiality and control over the evaluation process
What’s the outcome of the average RFP?
The average winning RFP score is 87.9%—meaning that the winning proposal met nearly 90% of the organization’s criteria.
Furthermore, the average public sector RFP saves 22%. This is calculated as the difference between the winning vendor’s price and the average proposal price for that RFP.
Nobody would claim that the RFP process is perfect—there is always room to improve and evolve the process to meet today’s challenges of fast-changing markets and increasing demand.
However, this is a positive outcome! This study demonstrates that the RFP process is an effective method for organizations to get the goods and services they need at a good price, while following a fair and transparent process.