Central government has recently announced it will allocate an additional $11 billion to infrastructure projects over the next four years.
If ‘long, narrow’ structures which move people, power, water and freight around are the focus of your contracting or consultancy business, this is great news. News which should be quickly be followed by the question, ‘how can my organisation ensure it’s best-placed to secure contracts in its area of expertise?’
For suppliers to the infrastructure industry, successfully tendering for, and winning work is crucial. It is a core business development activity, which keeps work in the pipeline, and people in jobs. Over the next four years, the organisations which successfully partner with government to design and construct new roads, rail, power and communications infrastructure, won’t just be good at what they ‘do’, they’ll also be skilled at bidding for, and winning contracts.
Savvy tendering organisations are proactive. By identifying tendering opportunities early, they increase the amount of lead-time available for planning and preparation. Information about intended central and local government investment in capital projects is readily available and searchable, on-line. A good place to start is by:
- Accessing details of central and local government’s intended capital at www.infrastructure.govt.nz. Search for ‘Infrastructure Capital Intentions Plan’ to view the details of more than 6,000 prospective projects. To refine your search, the database can be sorted by region, sector, organisation and start year.
- Registering with the Government Electronic Tender Service (GETS) at www.procurement. govt.nz. As part of this service, you can opt to automatically receive information about opportunities in the specific categories and regions which are relevant to your business.
2. Create a pipeline and manage it
A list of the contracts you could bid for is just that … a list. If you placed these ‘prospects’ into a sales pipeline, what would it take to convert them into confirmed business or contracts won? If you have the lead-time and organisational resource, consider the following tactics to improve your tendering strike rate:
|Do you have an existing relationship/line of communication with prospective clients?||
Create a plan to ‘reach out’ and establish lines of communication. For larger businesses, arrange for your sales/business development staff to research contact names and plan 1:1 contact into their call cycles.
For smaller organisations, could a member of senior management be involved in making contact and building a relationship?
|Does your business have a proven track record in the services/physical delivery required?||
If you do, make sure your achievements are communicated – i.e. on your website and in sales/business development conversations.
If you don’t, do you need a strategy to build a relevant track record? Could you approach a head contractor and gain experience as a subcontractor; or partner with businesses with expertise which complements your own?
|Are you networked into your industry/sector?||Joining industry associations or business groups not only builds organisational profile, it provides opportunities to network, meet potential competitors and clients, and hear about opportunities. Many industry associations hold annual awards – you could consider entering past projects, to gain profile and recognition.|
While you won’t convert all prospects into business, a pipeline turns tendering opportunities into something which sales/ business development activity can influence, rather than a ‘static’ list of contracts you ‘might bid for’.
3.Prepare, and apply a process
While large organisations may have teams and resources dedicated to bid management and writing, any size business can prepare well and apply a solid tendering process. Good preparation, good systems and the commitment to apply these does not require a large budget.
Businesses who regularly win tenders make sure they use any lead-time before the release of Rfx documents, to prepare. In addition to the relationship building activities outlined above, this could include preparing a SWOT analysis to understand your organisational strengths and profiling your competitors (i.e. ‘threats’). Any ‘intelligence’ gathered during outreach and relationship building activities will provide important insights, during this process.
Further research to understand your client is also good prep. Details of strategic drivers, vision and/or values are usually readily available on client websites, and general online searches may also provide useful background information. Once you start writing bid content, this must be client-focused so the more you understand about your client and their drivers, the better.
An effective tender preparation process is key to a quality bid. This should include a bid strategy session followed by a series of formal reviews. The best processes enable subject matter experts to work together, share knowledge and agree on the factors which will differentiate their business/win the tender. As work progresses, an agreed framework with milestones and responsibilities gives a bid team the clarity, accountability and focus needed to craft a quality tender response.
4.Learn lessons and improve
If your tender is not successful, make sure you seek and act on client feedback. Review the sections which didn’t score well, so lessons learned can be applied to future submissions. Identify high scoring sections and replicate this content and/or approach in your response to similar tender questions. (Although don’t be tempted to ‘cut and paste’, make sure you ‘massage’ the content to specifically fit the question).
It’s also useful to hold an internal debrief with your team to critique what aspects of the tendering process worked (and what didn’t). Discuss, gain consensus and, if necessary, make changes. Both the content you create and the systems you use should be subject to continuous review and improvement.
The ability to bid strongly and win tenders is the lifeblood of businesses involved in New Zealand’s infrastructure sector. This means the bar is continually being raised, in terms of quality of content and presentation being produced. Competition to secure contracts which comprise Government’s multi-billion spend over the new few years will be intense. Proactive businesses will start their preparations now.
Written by Christina Low, a senior consultant with Plan A.
For more information and further practical resources on how to improve your tender win rate, visit www.plana.co.nz/resources.