What is a Request for Proposal?

A request for proposal is a formal document issued by an organization soliciting proposals from consulting firms to address a specific need. RFPs outline project requirements, evaluation criteria, submission deadlines, and contract terms. For consulting firms, responding to RFPs requires significant investment (typically 40-100+ hours for complex responses) with uncertain outcomes. Effective RFP management involves selective response (bid/no-bid decisions) and efficient proposal production processes.

Key characteristics

• Formal procurement document with specified requirements and format

• Includes scope of work, evaluation criteria, timeline, and terms

• Response requires substantial effort (40-100+ hours typical)

• Win rates typically range from 10-40% depending on positioning

• Often involves multiple rounds (shortlist, orals, best and final)

• May favor incumbents or firms with established relationships

Why it matters for service firms

RFPs represent significant opportunities but also significant investment. At an average cost of $200/hour, a 60-hour RFP response costs $12,000. With a 25% win rate, the expected cost per win is $48,000. Firms must be selective, pursuing RFPs only when they have a genuine competitive advantage. Effective RFP operations include: bid/no-bid frameworks to screen opportunities, content libraries to accelerate response creation, and win/loss analysis to improve over time. Undisciplined RFP pursuit wastes resources on low-probability opportunities.

Real-world example

Strategos Consulting receives 45 RFP opportunities annually, but has the capacity to respond to approximately 20 of them with quality. They implement a bid/no-bid scoring framework: relationship strength (0-30 points), technical fit (0-25 points), competitive positioning (0-25 points), and strategic value (0-20 points). Only opportunities scoring 60+ proceed. First year results: responded to 22 RFPs (49% of opportunities), won 8 (36% win rate), totaling $2.1M. Previous year without framework: responded to 38 RFPs, won 7 (18% win rate), totaling $1.6M. The disciplined approach improved the win rate 2x while reducing wasted proposal effort by 40%.