Five steps for getting your RFP right.
By Matt Rivera
Many organizations looking to outsource their contingent workforce to a managed services provider (MSP) wade into the request for proposal (RFP) process blindly. So it’s not surprising that it can take up to a year to complete. And by that point, you’re lucky if your needs are still the same.
But the RFP process need not be long or unwieldy. You can take several steps to build an effective and efficient RFP, and it all starts with key preparations before the entire process even starts.
First, assess your use of contingent labor. When you know how many temporary workers come in and out of your organization, where they work, and how much you spend on them, you’ll be able to set goals for your relationship with an MSP and clearly communicate those needs.
Second, determine your company’s tolerance for change. If your managers typically resist change, you’ll know you’re going to need a slower RFP process that spells out each step, involves more people, and requires change management to accommodate the learning curve and address any concerns in the process.
Both of these steps will help you tailor the RFP to your organization, a move that helps prevent unforeseen delays and pinpoint the best provider for your contingent labor needs. As you begin the RFP process, here are five ways to help speed it up.
1. Seek early buy-in, and form small committees. Your RFP process won’t succeed without the support of executives and the department that manages contingent labor. If your biggest usage area is IT, for example, you’ll need IT’s support to gain the true benefits of having the program. Encourage buy-in of executives and departments by mapping out the goals of the program, which could include greater efficiency or transparency. Explain that suppliers will be subject to performance metrics, highlight the ease of tracking cost savings with an MSP, and point to the improved quality that should result from a vendor-managed contingent workforce. As you gain buy-in and communicate with different executives and departments, form a committee to handle the RFP process. This group ideally shouldn’t include more than three to four individuals—and make sure one is from operations.
2. Avoid getting stuck on vendor neutrality. RFP responses will indicate whether a potential vendor has the best program for your needs, whether vendor neutral or not. While valid arguments for and against vendor neutrality exist, the managed staffing RFP process is primarily a question of what’s best for your organization. MSPs should be able to articulate why their program makes sense for you.
3. Ask specific questions, not essay questions. Keep in mind that these questions should direct suppliers to show how they’re going to meet your organization’s goals. The more questions you ask, the less relevant they’re likely to be, and the more likely they’ll invite fluff answers. Build questions based on the program goals you used to achieve executive buy-in. Provide specific scenarios that relate to your organization and the goals you’ve outlined.
4. Decide on technology first. Think less about specific technologies and more about how technology can be implemented or managed by an MSP. Several different options exist. You could purchase technology separately or through the MSP. You could even work with your MSP vendor to find the right technology platform. Determine how your company wants to approach it before you draft the RFP, because that plays a major role in the structure of your RFP and the response you’ll receive. The approach should be based on your company’s needs, size, usage, and the complexity of that usage. Larger companies often have existing technology and need someone to run it, but small companies often lack technology and want a supplier to provide it. Mid-sized companies can be anywhere between the two.
5. Have statistics and forecasts ready. More often than not, companies don’t closely track their contingent labor usage and have no formal assessment of their needs. Knowing how much you spend, how many contractors you have, and what types of positions they fill will determine the accuracy of the RFP response. Too often, companies send out RFPs based on old data. If the RFP is submitted in April, statistics are usually from December of the previous year. Then, if the process takes six to eight months or more to complete, your program will launch using numbers from a year before. As part of the analysis of your current program, track and understand your basic usage to ensure that the RFP process and final negotiations are in line with your current needs.
With effective preparation, organizational buy-in, and a direct RFP process that draws on current metrics, you’ll get the MSP you need without the headache and delays that often accompany this process.
Matt Rivera is director, customer solutions for Yoh.