Why requests for proposals need improvement in the nonprofit sector

Attention nonprofit decision-makers and service contractors caught in the time-sucking tango called the request for proposal dance, this post is for you! The current RFP process replicates the grant application torture cycle nonprofits themselves are often subjected to by funders. So how can we break the pattern of abuse?

Let’s start by putting our cards on the table. As a communications agency offering professional and technical services to the not-for-profit sector we have responded to our lion’s share of requests for proposals, ranging anywhere from the simple website rebuild to the multi-million dollar capital campaign.

But there are days when we can’t help but ask ourselves – why are we doing this? It’s not about the obvious answer, it’s more about the existential aspects that we need to stop and consider. Similar questions are being asked about grant applications, another process having an even deeper crisis right now, given the increasing social awareness around justice, equity, diversity, and inclusion.

Why do requests for proposals exist?

Common sense says that you need to have multiple bids for a project or service you require outside help for. It’s often prescribed in by-law or company policies in fact, how else can you determine who merits the contract. But who does that really serve? Does it benefit leadership to compare and contrast multiple bids that often don’t present identical products or services in the same way?

Maybe it is strictly a numbers game to comply with expectations, written in bylaws or not. It has always been done that way, get as many bids as possible, go with the status quo. Does that seem fair to the multiple consultants that spend unpaid hours to comply with the prescribed application process? Cindy Gallop, brand and business innovator, recently shared a post about how some nonprofit organizations expected others to provide “donated” time and the consequences faced by service providers – the real experts in their field.

At Phil, we have come to learn that offering services in the nonprofit sector is almost always about the relationship and trust. Rarely are RFPs precise enough in their objectives to allow you to compare bids like apples. You might be surprised with a rotten core if you take that route.

Bad RFPs are a waste of time, energy, and resources

Just like bad grant applications, bad RFPs often stack up unrealistic expectations on top of ridiculous timelines. Here are the 5 elements of a bad request for proposals:

  1. Asking for examples of proprietary work done for previous clients
  2. Giving less than 2 weeks to submit proposals
  3. Using an arbitrary point systems to grade bidders
  4. Not interviewing the top contenders
  5. Not disclosing a budget

What comes around goes around

There is definitely a negative pattern repeating itself with the current processes in place for RFPs in the sector. Because of unbalanced power dynamics at play with most not-for-profits and their funders, the onerous methods traditionally used by funders become the norm.

Funders put contingencies on organizations to provide evidence of “good governance and sound operational procedures” that often need to mimic their own systems. It is not a surprise then that few organizations take the time to map out the real cost of operating under the status quo.

The elephant in the room

By requiring consultants to submit proposals that will not likely be considered because a contractor has already been informally chosen from an organization’s existing contacts, organizations are only creating the mirage of meritocracy. We would argue that the illusion of a level playing field is a false narrative that punishes service providers that operate outside of traditional networks, including more often than not underrepresented people in the nonprofit sector – black, indigenous, people of color, disabled people, LGBT people, and womynx.

By asking some basic questions about their processes and by investing some time and resources in learning some effective improvement and technological tools at their disposal, many organizations would see improvements in the diversity of bids and the valuable relationships created through a more transparent endeavor. This in turn might lead to new ideas being proposed that would certainly add value to organizations.

How to write a RFP – the right way

Aside from taking the time to invest in reflecting how some management systems might have negative internal and external effects, writing a better RFP means including more lead time to incorporate the human aspects of starting a new professional relationship. Here are the “must haves” we have identified as essential components of a better request for proposals:

  • Allocated the appropriate time to receive and answer questions from bidders – better informed bidders customize their offer to your particular needs.
  • Goals that are clearly identified – organizational goals and individual project or service goals gives context to better clarify a service offer.
  • Talk to consultants you are considering – it is not going to get anyone’s hopes up, it is about chemistry and working style, something you don’t get in a traditional bid.

Change management can be complex, so don’t be shy to reach out for help. We offer support and training for decision makers in the nonprofit sector to make change easier. Together we can break the cycle of replicating inefficient and ineffective management strategies that make your job more than it needs to be. We like to start with a conversation, give us a call today!