Enterprise IT Sales & Distribution–

A high level understanding


Transactional/Commodity
• One Time Sell
• Well understood product
(Information Symmetry)
• Seller deals with consumer
• Low price high volume
• Easy switch in/out
• Less sophisticated decisions
• Short sales cycles
• Simple sales org
• Price based
Transaction Vs Enterprise
Selling Paradigms
Enterprise
• Relationship Selling
• Needs consultative approach
(Information Assymetry)
• Seller deals with customer
• High price
• Long term commitments
• Highly sophisticated decisions
(Not just monetary price)
• Long sales cycles
• Complex sales structure
• Value Based
 To Who Do I Sell
• Enterprises

• Senior Executives – CXOs (LOB and IT)

• Internal Stake Holders

 Types of Sales Roles
• Business Development
Is about finding new customers in a given sales territory

• Account Management
Is about finding repeat business from existing customers.
Account Management also refers to managing the business relationship with
a pre identified set of organizations referred to as Accounts.
Understanding the Sales
Process
 Sales Management

The process of
- Planning
- Directing
- Control of
Personal selling including recruiting, selecting,
equipping, etc. and motivating the sales force
 What is Personal Selling

A promotional/sales method where there is in-person

interaction between the seller and the buyer.
- Seller Needs to Understand better the buyer’s needs
- Buyer needs to understand what solution the seller has to offer
to satisfy the needs.
- Seller tries to establish value of the solution and realize the
equivalent price.
- Buyer tries to rationalize the price through a formal process to
realize faster return on investment.
Personal Selling in IT Enterprises

 In IT Enterprise Sales, personal selling is the method

 It is the part of marketing that consumes maximum resources

(travel, training, etc.).

 Helps in building relationships for long term business benefits

 Helps selling to multiple stake holders in the business markets

 The best promotional technique in business markets where

media based promotions are not so effective.
 Activities in the Selling Process

Lead Generation
Prospecting
Lead Qualification

Preparing for the sales meeting

Contact the Prospect

Can be Sales Meeting

multiple
including
demos and Objection Handling
presentations
Order Closure

Account Maintenance
 Contacting the Prospect

 Refers to the initial contact.

 In a few cases, prospect initiated
 In most cases, seller initiated.
 Typical method is cold calling.
 Lead – A Potential Customer

Some Techniques of Lead Generation

 Prospect Initiated - website form, trade show booth or respond to an advertisement

 Profile Fitting – Uses market research tools, such as company profiles, to locate leads
based on customers that fit a particular profile likely to be a match for the company’s
products. The profile is often based on the profile of previous customers.

 Market Monitoring – Through this approach leads are obtained by monitoring media
outlets, such as news articles, Internet forums and corporate press releases.

 Canvassing – Here leads are gathered by cold-calling (i.e., contacting someone without
pre-notification) including in-person, by telephone or by email.
Lead Generation

 Data Mining – Evaluate information (e.g., in a corporate database)

previously gathered by a company in hopes of locating prospects.
 Personal and Professional Contacts – referrals from known sources,
paid referrals

 Promotions – The method uses free gifts to encourage prospect to

provide contact information or attend a sales meeting. For example,
offering free software for signing up for a demonstration of another
product.
 Prospecting

Is a continuous activity.
Is based on planning.
Happens in managed accounts as well as in business development
New solution areas from a wider portfolio or products and services
New Customers
Necessary for long term planning and achieving targets
Find what the customer is not looking for
Build the vision
Be the one to create the need
Servicing what the customer already know she wants gets you in the commodity trap and
is not fun.
 Qualification

The process of assessing if a lead is a potential buyer –

‘Prospect’
Key Qualification Criteria

 Lead is contactable – can I approach the stakeholders?

 Has a requirement.
 Requirement can be met – do I have the solution?
 Has budget – can buyer afford TCO?
 Is winnable – can we compete?
 Is worth winning - do we want to compete?
Preparation for the Sales Meeting

Sales Meeting, also called a Sales Call as the seller is calling on

someone.

Sales Call can be telephonic or physical.

What Happens in a Sales Call?
- Seller tries to know more about the prospect
- What is the requirement
- Who is the decision maker
- Organization Structure
- Purchase Decision Method
- What is the current IT landscape

- Prospect tries to understand the offering – if interested

- Each comes to understand if more time needs to be spent!!
 Gathering Information

 From Web Sites

 Publications

 Be habituated to regular reading

 Access financial statements if company is public

 Talk to sales personnel from none competitive industry

 Check with existing customers in the same industry

 Access social media - LinkedIn

 Importance of Preparation

 First impression !!!

 Informed people are more confident

 Tailor presentation, talk, collaterals to hit the nail

 Build compete strategies early in the cycle

 The Sales Meeting

The essence of the sales process is the sales

meeting!!

There can be multiple sales meetings.

- Initial presentation
- Requirement workshop
- Detailed presentation, etc.
 Sales Meeting

 Seller tries to get clarity on the requirements

 Rapport building
 Collect more information about the prospect
 Solution presentation
 Assess the prospect
 Objection Handling

 Objections refer to resistance a prospect has towards the stated

position. For example, you want to meet the prospect today but
he says he is busy and can meet tomorrow.

 Can resistance be positive?

 Objection handling comes with practice

 Having up to date information is important

 Hear the objection completely before responding

 Order Closure

 Assurance from the buyer is not closure

 Deal is not closed until signed on the dotted line
 Buyer’s commitment is tested at this stages
 Sales personnel need to be persuasive
 Persuasion here is assistance and not manipulation

 Closure is a long process involving contracts.

 Account Maintenance

 Order closure is the beginning of a relationship

 In the business market, post purchase evaluation is
extensive.
 Seller needs to make sure that buyer feels satisfied.
 Post Sales consumes good sales time and is
proportional to order value.
 Proper account maintenance is key to increased
customer share of wallet.
 Buying Vs Selling Process
Customer Buying Process
Awareness Acknowledge Rationalize
Define Need Review Offers Select Best Engage Operate
initiation Pain Options

Organization Sales Process

Demand to Inquiry Inquiry to Order Order to Remittance

Sales
Marketing Service & Support
Engage Leads Opportunity Opportunity Customer Service
Propose Close Order
Generation Qualification Assessment Support

Cross Sell and Up Sell

Reporting and Analytics

 Org Structure

A Matrix Structure Is Preferred

A Lot of Collaboration and team work is required

Virtual teams are created to work on and win an

opportunity.
 Sales Tools and Assistance

Industry Reports and Templates

Insights

Solution Training Quotas and Targets

Collaterals Lead Generation Engine

CRM SME and Senior Execs

Territory and Account Industry and Customer

Plans Events
Managing the Sales Funnel
Sales Pipeline Management
 Sales Pipeline

 Pipeline refers to the set of prospects likely to close

business with you with value to each opportunity with
a timeline to closure.
 Pipeline has multiple stages as per the sales process
defined by the organization.
 Sales leads enter the pipeline and some of them come
out as customers. Others drop out at different stages.
 A Typical Sales Pipeline

Suspect
Lead
Prospect

Develop

Propose

Orde
r
 Sales pipeline should look like a funnel
 Movement in the pipeline from one stage to the other is called
velocity or acceleration.
 Historical level of acceleration and average deal size define how
your pipeline should be.
 Pipeline management is the most important task for individuals
and organizations.
 Mismanagement of pipeline is recipe for failure.
 Focus on Prospecting.
Sales Force Management and
control
Dimensions of Sales Management
 Role of a Sales Manager

 Set Objectives for the Sales Team

 Recruitment of Sales Force
 Manage Sales Budgets
 Motivate and Direct the Sales Force
 Monitor and help in sales activities
 Relationship Building
 Help Field Sales by assisting in cross functional
interactions
Information Technology in Managing the Sale
Force

Sales is a set of activities to be performed to increase the

probability of closure with effective relationship management
with all the stakeholders by successfully moving opportunities
in
the sales funnel on a regular basis.

IT systems called SFA tools help the sales force effectively carry
out the sales activities with sales managers monitoring sales
performance with ease.
When seen together with marketing management capabilities,
such systems are also called CRM systems.
 Benefits of IT in Sales

 Helps in centralizing data

 Allows contact and account management
 Maps the organization’s sales policies and processes
 Helps in assigning ownership and avoids conflict.
 Helps reporting upwards in the hierarchy
 Helps in conducting sales activities by highlighting
information need areas and with alerts and notifications
 Helps in objective assessment of sales funnels
 Helps in transitions, when required
You are interacting with a customer for a solution on real time analytics of
their transaction data to drive insightful action.

Discuss, what activities need to be conducted from start to end to close this
engagement.
 Role of Presales

Presales is the set of activities that needs to be conducted during

the sale process to align your solution to the customer’s
business problem. It is called pre-sales with sales being defined
as the order closing.
Presales includes the following tasks
- Need Analysis
- POC
- Solution Design
- Solution Proposal
- Solution Demonstrations
- RFP responses
 What is an Opportunity?
In the case of a business organization, Enterprise Sales opportunities are

- Favourable business chances

- Qualified based on reasonable yet thorough questions/parameters
- With organizational confidence around being able to deliver to the customer
- For gains that are monetary and/or for reputation and/or market penetration/expansion

Many Opportunities appear at different times.

Being strategic is about choosing the right ones!!

Not all opportunities are strategic or beneficial.

Saying ‘no’ professionally is not arrogance but being professional and in the interest of the prospect,
organization and self.
 Constructing a Deal
You are the account manager of a large bank. You interact with their IT and IT
Procurement teams almost on a daily basis. On a day when you visit them, their head
of IT procurement tells you that they need your proposal for your mobile
development platform.

You ask him a few questions like what applications they want to build and what is the
actual requirement. The Procurement Head tells you that they want to revamp their
Mobile Banking Application and they are evaluating options in the market. They are in
a lot of hurry and they will decide very soon. It is of utmost importance that you
submit your proposal soon as he says, your competition has already submitted their
proposal.

The opportunity, will be very important for your organization. If you get this deal,
based on the reference, a large market will open up for you.

Discuss your next steps.

 Short Supply Chain
• Direct Selling Model – OEM Led
• Partner Selling Model – One level Distribution Channel
• Short supply chain and hence lesser people to share margins.
 What is a Sales Channel?

Sales Channels can be from 0 to n levels.

Unlike sales channels in consumer markets, intermediaries do not generally

hold physical stock except hardware.

Order fulfillment is also most of the time done by the OEM and not the
intermediaries.
 Importance of Channel in IT
Enterprise Sales

 Allows the seller wider market reach

 Manage Geographies
 Manage Cultures
 Manage Social, Legal, Political environments

 Channel partners help discover and create value.

 Allows OEM to focus on core competencies

 Build Economies of Scale

 Allows buyers the convenience of place (availability)

 In Business Markets, allows better relationship management

 Allows selling in parts when the consumer is still thinking in whole !!!

 Puts more feet on the street that you can possibly afford.

Take a position:
Effective Channel Management can reduce piracy.!!
 Types of Channel Partners
Distributor Distributor of your products who
deals with the OEMs and further
deals with the resellers
Reseller Resells your product at a margin.
Value Added Reseller Adds value in the form of IP,
services and resells

ISVs Software creators. By virtue of

their software selling, underlying
pre-requisite gets sold
Considerations for an Effective Channel Strategy

 What is your market?

 What are your growth targets?

 Who are your current and potential competitors?

 What is the channel norm in your category?

 Channel Conflicts

 Goal Incompatibility

 Unclear roles and rights

 Differences in perception

 High dependence on the manufacturer

 Ownership
Proposal
 What is a Business Proposal

 A Written Proposal from a Seller to the Buyer

 As a Key Step in the Sales Process

 When Price is not the Only Consideration

 Proposal Types
 Formally Solicited Proposals
Proposals May Further Be
 As a Response to RFP
 Detailed
-Technical Proposals
 Competing Proposals are also Sought

 Informally Solicited Proposals -Commercial Proposals

 Based on Discussions Between Buyer and Seller With Binding Quote
 Has Context to Business Needs
 Brief compared to a Formal Proposal -Commercial Proposals
 When Competing Proposals may be sought. Without Binding Quote
(Ball Park, Trial Balloon)
 Unsolicited
 Proposals which are brief
 Talk About Seller’s Capabilities
 Generally ‘Leave Behinds’ /Collaterals
 Price or Commercials are Generally Avoided
You are engaging a large manufacturing company for your solution
that can take care of their supplier management, order tracking, etc.

You have finished your first presentation to the representatives of

business and IT. By the end of it, you are asked to submit your
proposal.

Discuss your next steps.

Contents of a Formal Proposal
1. Introduction

2. Executive Summary

In an RFP situation, Generally,

3. Process the Response
and Other Format and/or
Capabilities
Response Areas is/are Provided by the Buyer.
4. Understanding of Scope (What, How,
However, It Leaves Scope for the Bidder to Include Additional
Alternatives)
Information . 5. Approach and Methodology

6. Project
The typical contents of aPlan
Formal Proposal Are –
7. Project Organization

8. Commercials

9. Legal Terms
Information Technology Perspectives

You want to effectively target prospects to increase the success ratio in

your Marketing efforts and to get more bang for the bucks spent there.

A strong BI solution coupled with multi media marketing suite will let you
target the most potential buyers with the most suitable products.

This will also be a source of sustained competitive advantage for you.

Discuss your view points.

 In today’s world, IT is increasingly commoditized.
 Packaged software for even the most complicated requirements
 Advancements in computing and development platforms
 IT is outsourced
 Propensity for renting it out over the cloud

 IT is for infrastructure

 IT investments alone do not lead to competitive advantage

 You won’t lose by being a follower.

 IT is like any other investment area like raw material, machinery, etc.
 IT is a concept and strategy

Amazon used IT to establish a business model.

Flipkart used IT to make its business successful.

IRCTC reduced costs and increased customer satisfaction using IT.

IT becomes strategic when coupled with great business strategy.

Organization should be culturally geared to use IT to its full advantage

Innovation is continuous and organizations needs to be agile

From the supplier side, domain expertise, best practices, consultancy and knowledge
creation are the levers.
 Software Licensing
 Proprietary Software License
• Governed by copyright

• Software is the Intellectual Property of the publisher.

• User is granted the rights to usage.

• Restriction on copying, distribution, reverse engineering, modifications.

• Example, Microsoft Windows, Oracle Database, SAP ERP

• Accompanies warranties and support

 Open Source Software License
• Copyleft!!

• Passes right to the software and usage – object code and source code.

• Creates a copy owner and not another copyright owner!!

• If one modifies the code, one has to share the source code and not the object code of the
modifications.

• Warranties are generally not attached and support is community based and not liability of
the publisher.

• Example: JAVA, LINUX, MYSQL.

• Is Open Source always free?

 What is a License
• An agreement or legal instrument governing usage or distribution of the software

• Licenses are applicable to proprietary software as well as free ware/open source

• In the case of proprietary software, buyer is granted only the rights to usage.
Ownership of the software still resides with the publisher.

• In the case of open source software, rights to the software are generally
transferred to the user.
 License Types

Traditional License Types New Age Licenses

• Transaction Based
• User Based Access
• Master Record
• Server Based Access Based

• Processor Based • Subscriptions

Access (ASP/Saas)

• Devise Based

These license types are not discreet. A combination is generally used. For example, 20
user licenses for only two server modules of the available 5 modules.

For example, buyer can have Microsoft SQL Server’s Standard Edition without the option
for a Disaster Recovery (DR) option for only 10 Client Access Licenses (CALs)
 User Based Licenses
• Governs number of users accessing the software
• Can be
– Named User
– Concurrent User
– Unlimited Users

• Licenses generally governed by EULA, license is trust based.

(Publisher trusts the user that more copies will not be used)

• For users that have to connect to a server, restriction can be imposed through the
license manager.
(Publishers necessarily do not put this restriction)
 Server Based Licenses
Refers to modules enabled on the server. For example, Siebel
CRM has sales, service and marketing modules. One can
enable some or all modules.

Server licenses are also used as license managers that govern

end usage – number of people connecting, number of
installations, etc.
 Other Types
• Processor Based: Based on the number of processors in the server (Single
Processor, Dual Processors, etc.). End usage in such cases in unlimited.

• Transaction Based
– Governed by number of transactions for a periodicity and not number of
users/servers etc.
– Follows new age solution approach and brings publisher and buyer to a symbiotic
relationship

• Master Record Based

– Based on number of entities that require processing and not number of users.
– Example: HRMS systems are licenses on number of employees and not number of
users.
 Enterprise Licenses

- Based on Special Terms

- Gives sellers large transactions and stickiness and buyers benefit of bulk
purchases and special terms

- Are based on special agreements.

 Proprietary License Lifetime
• Generally, licenses are perpetual
• However, technology keeps changing
• New versions are available as part of Annual Maintenance
Contract (AMC).
• If not on AMC, in the case of version upgrade, licenses need
to be procured fresh.
 Saas
Subscription based usage rights is becoming increasingly
popular. If not all, then the majority of offerings will be
subscription based.

Solution providers not only provide the

software/solution, they provide other necessary
services like physical servers and space, security,
system maintenance, backup and BCP (High
availability, Disaster Recovery), etc either as a bundled
offering or as options.
 Benefits of SaaS to Buyers
• Capex vs Opex

• Deferred payments reducing huge cash outflow

• No need to worry about infrastructure, resources

• Consumption of solution and not technology. Dealing with one supplier only.

• Access to advanced services like BCP at fractional costs

• No need to worry about upgrades, patches, etc.

• Easy switch in switch outs

 Benefits to Providers
• Wider market reach

• Ease in penetration as TCO is lower

• Circumventing technology biases

• Servicing costs are lesser

• Protection against user bias against front end systems

 What is an RFP

 RFP – Request for Proposal

 Also called RFQ – Request for Quote
 Traditionally known as ‘Tender’
 A process
 of inviting bids from competent parties
 for generally well defined needs
 signifying only an intent and not an obligation.
 Types of RFPs

 Open RFPs
 Generally available to all (access)
 Satisfying certain eligibility criteria (Respondents)

 Closed RFPs
 Available to only select parties
 Generally succeeds an RFI process
 When?

 Generally Public Sector or Public Sector Enterprises

 Large Enterprises

 When requirements are complex

 Large Capital Outlay
 Specialized Suppliers
 The act of bidding engages you in the following

-Relationship with an
Enterprise

- Aligning with the strategic

intent of your organization

-Showcase capability

-Invest (Actual Investments

and Opportunity Cost)

-Compete

-Win to earn revenues

-Deliver the solution

 Some Strategic Questions to Answer

-Should I get into this relationship?

-Is this in line with the strategic

intent of my organization? Should I
Win?

- Do I have the capability?

- Can I Invest?

- Can I compete?

- Can I win?

- Do I have the resources to

deliver?

- Can I commit for long term?

Bidding is secondary – first, have a good sales strategy!

Only a healthy sales funnel will let you make strategic

decisions!

Otherwise, Top Line takes away all the attention.

Objective the subsequent sections is to understand the

strategic areas in bidding assuming that the above are in place!
Part II: Strategic Bidding
What is Strategic About Bidding

Given an RFP that you have received and you need to respond,
what is strategic? Discuss.

Key Considerations are around

-Winning
-Profitability
-Reputation
-Opportunity Cost
Scan through the shared RFP and identify its contents
 Typical Contents of an RFP

 Requirement
 Eligibility Criteria
 Scope
 Timelines and Dates
 Contract Details
 Response format
 Contact Details
 COST:
The objective of bidding successfully by any supplier are to
-Win the opportunity
-Optimize risk for the customer and self

Risk of exceeding
target cost

100

80

60

40

2
0 Strategic
Zone
0
Total Cost
TC1 TC2
 Did we put the effort to analyze the bid documents sufficiently without
missing crucial details that may adversely affect us later?
A well defined strategy not only handles strategic issues but also helps in
improving the success ratio!
Have we understood our role in the project delivery correctly?

Are we able to identify the list of deliverables and properly account for its
costs and associated risks?

Are we committing to something that we have no control on?

Do we clearly know the gap between what we claim and what we have
and can deliver?
Elements of a Good Bidding Strategy
 A Structured Bidding Process Bidding is defined as

 Identifying the key cost “The art and science of using

factors historical data, personal
 Contractual Terms expertise, institutional
 Deliverables
knowledgebase and exploiting
 Risks
the underlying strategic issues
 Resources
to predict the optimal
expenditure of resources and
 Strategic Issues
time”

 Leverages
Discuss why is it an Art as well.
RFP Response Stages
People Involved
Steps In The Structured Bidding
No Step
Process
Owner
1 Receive RFP and Bid Owner
setup teams
2 Understand Team 1 (PM, Sales Mgrs,
Requirements Commercial Mgrs)
3 Conceptualize Team 2 (PMs System
Solution (What?) Analysts, Architects)
4 Conceptualize Team 3 (PM, Commercial
Solution (How?) Managers)
5 Gap Analysis Team 1
6 Formulate Response Team 1 + Owner
Strategy
7 Prepare Proposal Team 1 and Team 2
8 Strategic Review Team 1 + Owner + External
Consultant (Optional)
9 Submit Proposal Sales Manager
 Receiving an RFP

What do you mean by receiving an RFP? Discuss

RFPs/RFIs can be received from the customer, web site,

partners.

The output of this step is whether to go or not for the

bid and the people that will be involved in the case of
‘Go’.
 Understand the RFP
Requirements
What do you mean by Does customer have a part to play
understanding requirements? here?

Types of Requirements Unless details and doubts are

Generic asked and clarified, requirement
Eligibility cannot be understood.
Scope
Legal Terms
Timelines
Financial Aspects, etc.
Technical
Functional Requirements
Technical Environment
Integrations and Interfaces
Conceptualize Solution (What and
How)

What is the solution is a matter of KNOWLEDGE

WHAT is the stepping stone to know the HOW

WHAT Defines the SCOPE

HOW is determined by the level of SKILL

HOW Defines the Deliverables, Resources, Effort and ultimately the

COST.
 GAP ANALYSIS

Identifies gaps between what has been asked or is

required and what can be provided.

GAPs exist with resources, finances, infrastructure,

processes, etc.
 Response Strategy

The key to winning a bid is the right response. The right response is
the one that has
 The right solution
The right cost
Optimal risk
Considered the strategic issues and leverages

Response Strategy defines the look of the Proposal.

Understanding The Steps In
Strategic Bidding
Understanding RFP Requirements
 Delivery
Customer
Function

Request for Clarification

Clarification Responses
Understand Technical Scoring, Key
RFP
Professionals Required,
Requirements Risks
Suggested Outsourcing

Partners/Subcontractors

Request for Clarifications

Sales
RFP Risk Areas
You are an IT services company working in the web development
domain and specialize in Java as well as .Net.

Read at a high level the RFP on POS system of Great Car Care and
discuss if you would want to bid or not for this RFP. Also discuss
your key considerations on your position.
 The decision to bid (Go) or otherwise (No Go) is the fist and crucial outcome
of understanding the requirements.

 It is taken by the bid owner after discussions with and findings of one or
more people in the team.

 This decision is taken considering critical and strategic issues in or with

respect to the RFP and can depend on one or more of the following
 Eligibility Criteria
 Resource Availability
 Legal and Contractual issues
 Restrictions or role in the RFP
 The Functional Requirement

 At times, customer is also involved in the go or no-go decision

Read the Great Car Care RFP in details on POS
system to analyze and identify the requirements. The
requirements can be categorized under the work
product, implementation, support, training, etc. and
generic requirements.

Define a table with S.No, Requirement Category,

Components and Remarks.

Try to do this individually and then compare your notes.

 Steps in Understanding the RFP
Requirements

 Analyze Requirements
The outcome of which is the Deliverables Checklist

 Conceptualize Vendor
Talks about your role in the RFP (based on the Deliverables) that can be
 Prime Bidder bidding alone
 Prime Bidder bidding jointly with a partner/sub-contractor
 Become the sub-contractor, remain behind and let another company frontend.
 Prepare Bid Analysis Report

 Review the Bid Analysis Reports and Arrive at the Final Report
 Bid Analysis Report

RFP is analyzed to understand the deliverables, risks, capabilities, resources ,

strategic issues and leverages.

List of Deliverables.
 Helps to understand the scope and expectations
 Helps to decide on the role in the RFP.
 Helps in the response strategy later by calling out the strategic issues and leverages.
 Helps in proper estimation based on deliverables identified

Potential Risks.
Risks in a project arise out of many areas like resources, domain, industry type, project type,
technology, etc.
 Identifying risks along with their extent/degree allows us to first take the go or no-go decision.
 It allows in identifying the strategic issues and associated risks to then plan for risk mitigation

Technical Capabilities.
We can only claim what we posses in terms of platform expertise, domain knowledge, type of
engagement, etc. Proper assessment of capabilities helps in identifying the following.
  Risks
 Strategic issues and Leverages

 Resources Required.
The right personnel are required for preparation of the proposal.
Identifying the resources helps in making the RFP response plan and
establishing ownership

 Assumptions/Clarifications

 References and Knowledgebase

 Other Comments
Understanding The Steps In
Strategic Bidding
Conceptualize Solution
Conceptualizing the solution refers to the actual work product/software to
be delivered.

Solution is conceptualized at a high Level to arrive at WHAT is the solution.

This is then drilled down to arrive at details on HOW to provide that

solution through programming, integrating components and deciding the
level of automation/sophistication.

The high level solution as a context diagram identifies the man-machine

boundary.
This is about how the various actors will interact bi directionally with the system
The system itself may be further drill down to display the components in its architecture like products,
integrations, infrastructure, etc.
Exercise.

Go through in detail in the RFP on POS system for Great Car Care and come
up with the context diagram on the solution.

Login Authentication and

Admin Access

Enter the Masters –

Location, User, Product, POS System
services

Example Above tells an actor as Admin and an input to and output of the
system.
 FTEs/
Admin Login Authentication and Login Authentication and Supervisors
Access Access

Enter the Masters –

Location, User, Product, Enter Sales Data in local
services. currency

Create Users, Manage

Access
POS System Delete and Modify Sales
Data
Create and Share MIS

View Sales Data in local

currency as well as common
reporting for HQ.

RMs and
Access MIS and Edit Filter
Managers
Parameters

MYSQL
Query the data marts and
access rights, update report
run status
POS SYSTEM
I E
n x
t t
e e
r r
n n
a Applicatio a
n Server l
l
F F
I I Http access over web
r r browser – IE6, IE7, Firefox
e e
w w
a a
l l
Reporting
l l
Framework
The output of this exercise is

-Understanding of the high level solution

-Business Functions to be carried out by the application
-Man Machine Boundaries
-Entities interacting with the system

With these inputs, we can now work on identifying the input/output

processes and business functionality required.
This is the first step of identifying HOW to deliver the solution.
 Developing the Low Level Solution – HOW

Business Functions as available from the context diagram and

granulized further need to be prioritized across
- Mandatory: Requirements that are essential for the software to function
- Important: Requirements that are critical for the software to function effectively and
efficiently
Ex: It is mandatory to have the facility to create reports. Report creation rights to end users
may be important. It can still be done by the Admin.
- Desirable: Requirements that can be fulfilled provided there is sufficient budget.
However, even without fulfilling these requirements, the system will function efficiently.

Exercise: Identify the functions required for the POS system and
S.No Function/Requirement Priority (Mandadory/Important/Desirable
prioritize them. The format should be
1 Admin to enter the Mandatory
Location Master
S.No Function/Requirement Priority (Mandadory/Important/Desirable

1 Admin to enter the Mandatory

Location Master
2 Admin to enter the Mandatory
product master
3 Admin to create Mandatory
users and define
permissions
4 Admin to create Desirable
user roles
5 Admin to create MIS Mandatory

6 User Login Mandatory

7 User First Time Mandatory

Password Change
8 Forgot Password Important
Functionality
9 Enter Sales Data Mandatory

10 Enter Data for only Mandatory

current of past
dates
11 Modify Entered Mandatory
Data
12 Delete any data row Mandatory
 S.No Function/Requirement Priority (Mandadory/Important/Desirable

13 User Access Control Mandatory

14 Manager Data View Mandatory

15 User Hierarchy Mandatory

16 View MIS Mandatory

17 Create MIS Desirable

18 User Access as per Mandatory

locale
19 Reporting as per Mandatory
locale
20 Consolidated Mandatory
reporting as per
regional and
national locales

Prioritization is required to segregate the requirements that

are absolutely necessary and the desirable ones. Also, it
helps in identifying the price limits considering the various
combinations and identifying the combination that fits in the
strategic zone. Some leverages also arise out of here.
Once the functions and requirements have been identified, they need to be
classified across the level of desired automation.

A low level automation leaves most of the date entry to users with
minimum validations whereas a high level of automation lets the system
manage the data exchange, validations.

Again, this is done to identify the cost range and leverages.

S.No Function/Requirement Low Level Medium Level High Level

1 Admin to enter the Manual Entry One time file Automatic

Location Master Row Wise upload from Online update
excel and then from HRMS
periodic file
upload
2 Admin to enter the Manual Entry One time file Automatic
product master upload from Online Update
excel and then from ERP
periodic file
upload

3 Admin to create users and Manual Creation Upload of user Creation of

define permissions of users list from excel users online
integrating with
HRMS
4 Admin to create user roles

5 Admin to create MIS Run Standard Wizard Driven Integration with

Queries on the reporting Data
Database Warehouse
The project requires activities like software development
and then installing it.
Both these activities are discreet and can be called
separate work items.

Identify other such discreet work items and also sub work
items, if any, within any work item.

Software
Development

Requiremen
t Study

Design
 Work Breakdown Structure

POS System

Post
Software Commissioni Production Documentat
Training UAT Production
Development ng Rollout ion
Support

Requiremen
t Study
- Project is divided into small and manageable
units
Design
- Each unit is a Work Package (WP)

Developmen - Each of the WPs has to be estimated for cost

t

Testing
 Estimation

 Estimation here refers to estimating the cost of software development

 This is the most crucial element of cost estimation
 Other elements are a lot of times derived based on the effort for software development

 Estimations can be done through Judgmental as well Formal Estimation Techniques

(FPA, COCOMO).

 The trend today is more of package implementations than bespoke development.

 OEM’s IP or products
 Reusable internal IP

 Estimations are more Expert or Judgmental based.

 A key element is to use organization’s historical data to arrive at estimates

 Estimation Templates
 Probability of deviating and degree of deviation
 Function Complexit Effort in Remarks
y Days
Create L 1 Manual
User Creation
of user
record
Edit User L .5 Editing
User login
Managem informatio
ent n,
permissio
n, etc.
Delete L .5 Flagging a
User user as
deleted
 Function Complexit Effort in Remarks
y Days
Pre- H 3 Need to
Defined take care
Reports of
historical
data
Report Report M 2
Generatio Access
n Control
Currency H 3
Based
Rolling up
 Function Complexit Effort in Remarks
y Days
Enter L .5 Need to
Product take care
Master of
currency
based
pricing
Managin Maintain L 1
g Old Pricing
Product Informatio
n
Editing L 1 Need to
Product maintain
Informatio historical
n pricing
informatio
n
Item Effort Remarks
Development 25
Data Modeling 3
Requirement 5 @ 20% of
development
effort
UAT 5
Training 5
Documentation 5
Rollout 2
PM 8 @ 20% of overall
effort
 Documentation

Rollo
ut
UAT and
Regression

Training

Development and Testing

Design

Requiremen
t

7/1/20 14/1/2 21/1/2 28/1/2 4/2/20

12 012 012 012 12
 Project Resources

Requirement Development Testing Documentation

Tester Technical Writer

Business Analyst Project Manager

Dev Lead
Tech Lead

Developer
 Cost can now be estimated based on Rate Card for each resource type or a
blended resource cost.

Question: Are we done with cost estimation?

Consider other elements of cost – cost checklist

-Incidental Expenses
-Non Billable Resources – Project Management, QA, Configuration
Management, etc.
-Support Costs
-Assurance Costs
-Other costs on infrastructure, hosting, platform, etc
Understanding The Steps In
Strategic Bidding
Formulating Response Strategy
 Why a strategy is required for
responding?

 Only the best responses are selected.

 It is what you propose against what has been asked.
 A good response is not only your intent to deliver but your confidence in doing so.
 Role in the RFP
 Choice of Partners
 In every situation, we have strengths and weaknesses though to varying degrees. It is
important to play up the strengths and manage the weaknesses. (Weakness here are
strategic issues).
 RFPs give a peek into the buyer’s state of
 Understanding.
 Preparedness


Preferences
Openness or biases.
Formulating Response Strategy involves
 Evaluation criteria identifying the GAPS, Strategic Issues
and the Leverages and handling them
appropriately.
Scan through the shared RFP and identify its contents
 Typical Contents of an RFP

 Requirement
 Eligibility Criteria
 Scope
 Timelines and Dates
 Contract Details
 Response format
 Contact Details
 GAP Analysis
Refers to GAPs with respect to the technical solution as well as GAPs in the
engagement/RFP

Sales Delivery Function

Overall GAP Technical

Analysis GAP ANALYSIS GAP
Analysis

GAPs can be with respect to process capabilities, technical capabilities,

certifications, finances, resources, industry, engagement type, location,
infrastructure, etc.
Some of these could be treated as Strategic Issues as well.
GAPs and Strategic issues need to be addressed with a proper
plan around how to manage them.

What role you play in an RFP is a very effective tool to manage

the GAPs and Strategic Issues.

Managing GAPs and Issues is not about a defensive strategy. It

is about managing them effectively with confidence possibly
through alternatives, if any.

If the GAPs and Issues cannot be managed, it will/should lead

to the ‘No Go’ Decision.
 Leverage Parameters

Leverages refer to strengths in a given RFP situation.

It is imperative to identify the leverages beyond the obvious.

Leverages not only exist but also can be created!

A GAP in process may lead to a partnership that can become a leverage parameter)

Sources of leverage parameters are domain expertise,

process maturity, past experience, references, favorable
contractual terms, existing relationship, competitors,
openness of the buyer, etc.