With the pressure on lawyers to drum up strong leads and secure new engagements, receiving an RFP may be a welcome opportunity for most. There are drawbacks, however, and it’s important from the outset to evaluate whether submitting a proposal makes sense for you or your firm.
An all-too-common issue surrounding RFPs is committing to the process before conducting the proper due diligence. Think about the steps your firm takes to vet an RFP opportunity to ensure there is a legitimate shot at gaining desirable work.
Often, when attorneys receive an invitation to participate in a bidding war, they feel flattered, intrigued and confident that the issuing company wants to work with them. They immediately presume that their firms must submit a proposal.
But responding to RFPs can be costly, time-consuming and stressful. It’s critical to read the formal request closely upon receiving it and quickly identify what would go into a winning bid before engaging in a formal exercise. To that point, consider the following three suggestions the next time you are evaluating whether to respond to an RFP:
1) Understand the purpose and leverage the inside perspective
“Reduction in legal spend.” “Unhappy with current counsel.” “Looking to consolidate services.” “By-law obligation.” “Strategic move against a competitor.”
That’s just a small sample of the reasons why a company might opt to go through with a tedious RFP process to retain legal counsel. Understanding early why a company is soliciting bids is crucial to evaluating whether your firm should engage in the process.
There are always specific motives as to why an RFP is being issued and understanding those data points in advance can speak to the quality of the opportunity. Talk to your contacts at the company, scour the news for major developments impacting the prospect or its industry, and investigate leads through your own network. You’ll not only help determine whether you should respond to an RFP, but having the “inside track” can also contribute significantly to the messaging of your proposal.
2) Carefully evaluate strategic conflicts
Very few industries are impacted by conflicts like the legal industry. Frequently, lawyers working within a specific practice area do not have the necessary 30,000-foot view of the firm, its long-term growth initiatives, and the strategic issues that need to be addressed before taking on a client that could create significant conflict issues.
A couple of engagements for a Fortune 500 company that seem promising on the surface but ultimately lead to minimal work can be more detrimental than one would think. Take the opportunity to talk to your colleagues who work regularly in the prospective client’s industry so that you fully understand the potential land mines well in advance. Furthermore, if your firm has a strategic conflicts committee, engage in dialogue with its members within days of receiving the RFP.
3) Pricing is critical
Nothing is more frustrating to companies than firms that opt to avoid pricing questions. With the vast majority of RFPs, reduction in legal spending is usually at the top of the list for the primary objective for soliciting bids. Generic responses do not cut it when it comes to fee questions. Companies expect firms to be able to develop sophisticated pricing options early in the proposal process.
More often than not, a firm won’t make it past the first round if it refuses to put some consideration into an attractive fee proposal that is mutually beneficial for both parties. Additionally, understanding your firm’s position by constructing a fee proposal at the beginning of the process will assist tremendously in evaluating if it’s worthwhile to submit a formal proposal.
Christopher Newman is senior vice president of client development at Cooley in Boston. He can be contacted at firstname.lastname@example.org.