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Written by Marijn Overvest | Reviewed by Sjoerd Goedhart | Fact Checked by Ruud Emonds | Our editorial policy

RFP in Project Management — Everything You Should Know

Key takeaways

  • To improve procurement and decrease costs, category management in procurement divides spending into product groups.
  • Direct costs are essential for products, while indirect costs help with daily operations.
  • Category managers need to be highly knowledgeable, analytical, and skilled communicators who can manage particular product groups.

RFP in project management is an important part of the procurement process as it gives you relief once you finally submit the finished proposal. However, how do you manage your RFPs in your company? 

In this article, we will talk about what RFP in project management is all about. We will also discuss its importance and how to improve your proposal process with project management. 

After reading this article, you will know the role of RFP in project management. Thus, it will allow you to make all your proposals clear and efficient.

I have created a free-to-download, editable request for information (RFI) template. It’s a set that includes a PowerPoint file and a Word file. 

You can use and tailor them to your needs when asking for information about the materials you want to buy for your project management procurement. I even created a video explaining how to use the templates.

Request For Proposal (RFP) Explained

A request for proposal (RFP) is an important document used to solicit bids before acquiring goods and services for a project. 

Almost all companies use RFPs in launching their projects. Many governments around the world also use this to start their projects. An RFP allows companies to select the most preferred candidate for their project. 

RFP is the most common tactic in procurement when companies want to select the best bidder for the project they want to do. The term RFP describes both the RFP document and RFP solicitation process which are the tools used in soliciting proposals.

As RFP helps companies to select their preferred bidders, it also allows them to properly evaluate the strengths and weaknesses of the offers without spending too much time and resources looking for them.

RFPin Project Management

Before we go further with RFP in project management, we must know what is project management first. Project management is the process of planning and executing defined procedures that monitor the actions, tools, knowledge, and roles needed to accomplish a particular goal. 

A project management’s ultimate goal is to improve consistency, efficiency, and outcomes of the project.

In project management, an RFP is a formal request sent by companies to potential suppliers to seek products, services, or solutions. 

When companies send it out, the document asks all suppliers the same questions. When a supplier sparks an interest in the document, the supplier will submit its answers in a proposal document for consideration.

Why is it Important?

An RFP is a proposal document companies create to describe the specifications required to finish their project. With an excellent RFP, you can do these:

  • Gather quotes from numerous suppliers to evaluate their prices and abilities which are factors to select for your project. 
  • Outline your specifications that allow suppliers to understand what to bid to win the project. 
  • Quickly evaluate the strengths and shortcomings of the bidding suppliers.

RFP project management is a crucial tool to check and compare the bids to choose effectively the best supplier to do business with. It also allows companies to scrutinize the project from different angles since each bidder includes their plan of action with their offers for the project. 

The best thing about RFP project management is that you will have the information you need from the bidders before committing to one of them. 

Improving The Proposal Process With Project Management

Here’s how you can improve the proposal process with project management.

1. Know the goal of the project

Knowing the goal of the project is pretty straightforward to win an RFP opportunity. It is important to think beyond the RFP and identify why your RFP is a good fit as well as the impact of it on the business once you complete the project. 

2. Define the tasks of the project

Once you know your goal, you must clearly identify the following tasks that your team must accomplish:

  • Identify tasks that can be accomplished at the same time
  • Schedule a kickoff meeting
  • Collect and submit follow-up questions for the buyer
  • Customize reusable answers 
  • Review your answer for consistency and accuracy
  • Format a proposal
  • Ensure that the RFP requirements are met
  • Submit your final proposal
  • Request feedback from the company
  • Hold a meeting for feedback to know your strengths and weaknesses

3. Create a proposal team

Now that you have listed down your task list, the question that you have to deal with is who are the people best suited to accomplish all the items on your list? 

Match the people with the tasks they will be assigned and the role that they will take part in the process.

4. Check the information and tools needed

Once you know the people that will compose your team, you need to ensure that your team has the right information and tools to successfully accomplish the tasks you identified. 

You may ask yourself, Do I have the performance data and customer references that the buyer asked for? Has your team researched well and gathered customer insights?  

You should check the information on your resources by verifying if it is available and enough for the project to avoid delays in your process.

5. Start the project and track and document key data

Now that you have taken a lot of things into consideration, the only thing to do is to start the project. In the kickoff meeting, you must ensure that your team knows the RFP project management approach and how to use it. 

As you continue making the project, you must track the consistency of your process. You can track it by gathering data on the response costs, time spent, answer quality, and final outcome. 

Once you have collected enough data, you should review all your processes if there are any roadblocks and opportunities for improvement.

Conclusion

RFP in project management is a crucial tool for companies to select the best bidder for their project. It allows companies to evaluate the strengths and weaknesses of the offers without spending too much time and resources looking for them.

In this article, we have discussed what RFP in project management is all about, its importance, and how to improve your proposal process with project management.

By following the steps outlined in this article, you can make all your proposals clear and efficient, and ensure that your RFP process is well-managed and successful.

Frequentlyasked questions

What is a request for proposal (RFP)?

A request for proposal is a document used to solicit bids prior to the acquisition of goods and services for a project.

What is RFP in project management?

An RFP in project management is a formal request sent by companies to potential suppliers to seek products, services, or solutions.

Why is it important?

It is important to select the best supplier by comparing each RFP that they have sent.

About the author

My name is Marijn Overvest, I’m the founder of Procurement Tactics. I have a deep passion for procurement, and I’ve upskilled over 200 procurement teams from all over the world. When I’m not working, I love running and cycling.

Marijn Overvest Procurement Tactics