1. The Decline of the Incumbent Empire: Rebid Strategies

2. APMP BID & PROPOSAL CON 2015 | PAGE 2 The Decline of the Incumbent Empire: Rebid Strategies LISA PAFE, LOHFELD CONSULTING GROUP

3. APMP BID & PROPOSAL CON 2015 | PAGE 3 Agenda  The Challenge  Perspectives  Capture Phase  Proposal Phase  Bring Home the Win

4. APMP BID & PROPOSAL CON 2015 | PAGE 4  Incumbents are losing more often  Still, best informed wins, so:  How does the challenger overcome the incumbent’s advantage?  How does the incumbent maintain their advantage? The Challenge

5. APMP BID & PROPOSAL CON 2015 | PAGE 5 Same customer, same workSame customer, different work Same work, different customerDifferent work, different customer Incumbent’s Perspective Incumbentitis: False sense of security, complacency, and over-confidence that results in failing to take the proposal process seriously and thus losing the rebid

6. APMP BID & PROPOSAL CON 2015 | PAGE 6 Challenger’s Perspective  Often over-estimate the incumbent advantage  Assume they can never gather the needed business intelligence to compensate  Think the only way to beat the incumbent is low price  Often under-prepare  Rely on rumors about incumbent’s poor performance instead of gathering real business intelligence  Read the ashes instead of setting the fire

7. APMP BID & PROPOSAL CON 2015 | PAGE 7 Pros of Incumbent:  No transition  Low risk  No mission impact  Keep the same people Customer’s Perspective Cons of Incumbent:  More expensive  Same ideas  Less innovation  Keep the same people Tension between level of risk aversion and other factors such as price, real or perceived need for new ideas, and appetite for change

8. APMP BID & PROPOSAL CON 2015 | PAGE 8  We may have capture and proposal processes  We may have a rebid strategy, BUT  We lack rebid specific processes  A rebid is different type of animal My Perspective: Rebid Processes are Deficient

9. APMP BID & PROPOSAL CON 2015 | PAGE 9 Top 3 Rebid Capture Actions for EVERYONE 1.Shaping 2.Value Proposition 3.SWOT Analysis

10. APMP BID & PROPOSAL CON 2015 | PAGE 10  Activate your listening campaign  90% listening, 10% talking  Network with ALL customer stakeholders  Strategy evolves as result of shaping Shaping

11. APMP BID & PROPOSAL CON 2015 | PAGE 11  Whether you are incumbent or challenger, you must have one  Evaluators perceive and score strengths when a proposed feature:  Exceeds requirements  Increases likelihood of successful contract/mission accomplishment  Offers a value-add  Is not offered by all bidders Value Proposition

12. APMP BID & PROPOSAL CON 2015 | PAGE 12 SWOT Analysis We Win (Reasons why we’ll win – maximize our Strengths)  Xx  They Win (Reasons why we’ll lose – Weaknesses for us)  Xx  They Lose (Opportunity to “ghost” the competition)  Xx  We Lose (Threats to us – need to minimize strengths of competition)  Xx 

13. APMP BID & PROPOSAL CON 2015 | PAGE 13 1.Start on day one 2.Leverage the Project Manager 3.Build risk aversion Capture Phase – Top 3 Actions for Incumbent

14. APMP BID & PROPOSAL CON 2015 | PAGE 14  Day one of contract award is day one of rebid planning  Ensure past performance is stellar  Start improving on day one (but save a few new initiatives for the proposal!) Start on Day One “The government will likely use the incumbent's past performance evaluations as a major factor in the re-compete process.” -GovWin by Deltek “The government will likely use the incumbent's past performance evaluations as a major factor in the re-compete process.” -GovWin by Deltek

15. APMP BID & PROPOSAL CON 2015 | PAGE 15  Begin greening early  Implement an innovation plan  Inform your shaping with a listening campaign Start on Day One continued

16. APMP BID & PROPOSAL CON 2015 | PAGE 16 Leverage Project Manager  The PM is your best listener and shaper  Teach him/her to be an ethical spy  Require the PM to implement a rebid knowledge repository

17. APMP BID & PROPOSAL CON 2015 | PAGE 17  Make sure relationship is not just with people (who can be captured) but also with your company  Offer value-adds specific to company capabilities  Highlight institutional knowledge (relationships, technology, processes)  Be prepared to mitigate risks if you cannot prime the rebid Build Risk Aversion

18. APMP BID & PROPOSAL CON 2015 | PAGE 18 1.Make honest assessment of win probability 2.Exploit incumbent vulnerabilities 3.Overcome the customer's risk aversion Capture Phase – Top 3 Actions for Challenger

19. APMP BID & PROPOSAL CON 2015 | PAGE 19  Start early and be honest!  Can you fill gaps and perform at the winning price?  If you cannot fill gaps prior to RFP release, then no bid Make an Honest Assessment PWS/SOW Requirements Bidder Core Competency Past Performance Customer Knowledge ______________________ Your Costs vs. Winning Price

20. APMP BID & PROPOSAL CON 2015 | PAGE 20  Find them: web searches, networking, LinkedIn connections (employees, teaming partners, customers)  Ghost them: promises made and not kept… goals not achieved… performance measures not attained… personnel not retained...costs not contained… financial instability Exploit Incumbent Vulnerabilities

21. APMP BID & PROPOSAL CON 2015 | PAGE 21  Learn hot buttons and turn these into potential risks of status quo  Offer compelling solution with strengths  Lower price may overcome perceived risk in today’s market Overcome Risk Aversion

22. APMP BID & PROPOSAL CON 2015 | PAGE 22 1.Turn win themes into ghosting themes 2.Conduct effective proposal reviews 3.Price to win Top 3 Rebid Proposal Actions for EVERYONE

23. APMP BID & PROPOSAL CON 2015 | PAGE 23  Articulate benefits to the customer (with proof) while ghosting what competitors lack  Ghost incumbent and build risks of status quo OR  Ghost challengers and build risks of change Turn Win Themes Into Ghosting Themes

24. APMP BID & PROPOSAL CON 2015 | PAGE 24  Don’t drink your own bathwater!  Assign reviewers to play devil’s advocate Effective Reviews

25. APMP BID & PROPOSAL CON 2015 | PAGE 25  Use reverse engineering and competitive intelligence to derive rates and markups for competitors  Recent studies show price erosion of 15-30% Price to Win Maximum acceptable bid (MaxAB) Price to win (Pwin) is somewhere in between Minimum acceptable bid (MinAB) Market driven competitive range is between MinAB and MaxAB

26. APMP BID & PROPOSAL CON 2015 | PAGE 26 1.Have the best proposal 2.Look to the future Proposal Phase – Top 2 Actions for Incumbent

27. APMP BID & PROPOSAL CON 2015 | PAGE 27  Expectations are higher for incumbent's proposal  Continuously improve on your winning proposal Better value proposition New proof points Lessons learned Improvements Cost savings Lowest risk Have the Best Proposal

28. APMP BID & PROPOSAL CON 2015 | PAGE 28  Most incumbent proposals read like a history lesson  Explain what you WILL do not just WHAT you did  Avoid repeating that you are the incumbent  Do not ignore problems and mistakes Look to the Future

29. APMP BID & PROPOSAL CON 2015 | PAGE 29 1.Exploit “incumbentitis” 2.Make the business case for change Proposal Phase – Top 2 Actions for Challenger

30. APMP BID & PROPOSAL CON 2015 | PAGE 30  Incumbents build risk aversion by focusing on the past  Focus your proposal on the future Demonstrate risks of status quo Ghost past failures Provide proof of future success  Take a fresh look at the price Exploit Incumbentitis

31. APMP BID & PROPOSAL CON 2015 | PAGE 31  Demonstrate low risk at better price Why is different better? What is the ROI? Which features are strengths? Are proposed innovations in keeping with level of risk aversion?  Gather and provide proofs for every element of the solution Make the Business Case for Change

32. APMP BID & PROPOSAL CON 2015 | PAGE 32  News flash: Incumbent and challenger have almost an equal chance of winning  No matter the outcome, capture lessons learned for your next battle Bring home the win!

33. APMP BID & PROPOSAL CON 2015 | PAGE 33 Questions  Share your lessons learned: How did you unseat an incumbent? How did you retain your incumbency?

34. APMP BID & PROPOSAL CON 2015 | PAGE 34 Lisa Pafe, CPP APMP & PMI PMP Principal Consultant Lohfeld Consulting Group, Inc. (703) 577-8490 lpafe@lohfeldconsulting.com www.lohfeldconsulting.com www.linkedin.com/in/lisapafe www.twitter.com/lisapafe Contact Us APMP PO Box 77272 Washington, DC 20013-7272 Phone: +1 - (202) 450-2549 www.apmp.org