Article

Making sense of RFPs

Many factors go into developing a sensible request for proposal. But communication between a company's marketing and IT departments is essential for turning an idea into a quality RFP.

February 28, 2002

When businesses need a manufacturer to create a product, they will often publish a request for proposal (RFP), a grocery list that allows businesses to specify exactly what they want from vendors.

The kiosk industry is no different. But a kiosk RFP is more complicated than a gallon of milk, a dozen eggs, and a bunch of bananas. A well-written RFP requires adequate planning from the company developing a kiosk project, and kiosk suppliers need time to assess the demands of the project.

Sweating the details

Usually, a business that wants a kiosk will publish an RFP outlining the features and functions they want in their systems. Often, the RFPs will focus on technological features - touch screens, specific printers, high-speed Internet access. As a result, the business strategy generally becomes secondary to IT.

Brian McGrady, general manager for Sparta, N.J.-based Instruments & Equipment Co., said it is common for IT to begin compiling the RFP first.

"You've got to make sure that the project has an application that has good value to the end user," McGrady said. "That's what really makes these things fly."

But Brian Sullivan, president of NCR Canada, a division of the Dayton, Ohio-based retail and financial technology provider, said putting IT before business is a short-sighted approach.

"That kind of approach is diametrically opposed to what businesses should be doing," Sullivan said. "For whatever reason, it becomes an IT initiative rather than a business operations initiative."

Analyze this

For RFPs to best convey a company's needs, Sullivan said the organization's IT and marketing departments must collaborate closely in the process. Sullivan argues that RFPs are a guidepost in mapping out kiosk strategies and thus should take in the big picture, not just IT issues.

"They need to embrace this as part of a larger organizational strategy," he said. "Typically we get the type of RFP that says, `Let's get that Web site down to the store' or `We're promoting interactive Web in the store.' "

But what tends to be missing is similar analysis of the kiosk's impact on distributing, merchandising, demographics, pricing strategy and other factors that businesses would consider when, for example, they open a retail outlet.

Michael Smith, managing director of Australia- and UK-based kiosk manufacturer NeoProducts Ltd., said his clients are already beginning to pack more business details into their RFPs.

"Generally, there is an increasing level of RFP requirements to most sales," Smith said. "I think it reflects a heightened business demand."

The use of an RFP is often contingent upon the size of the kiosk deployment. For a smaller project or a prototype kiosk for a client, an RFP is unnecessary. But when a business is planning on deploying hundreds or thousands of kiosks, an RFP is practically a necessity, Smith said.

"I would say generally that a well-written RFP is very useful," he said. "It defines the scope of work and minimizes arguments later on. It can lay down very clearly what has to be produced."

Help, I need somebody

Sound, thorough technical knowledge drives any good RFP. But even businesses with technically savvy IT departments and driven marketing staffs need guidance if they do not fully understand the requirements of a kiosk project.

"Quite often, we find that requirements might be written by someone with good technical knowledge, but they just specify top-end requirements when they're not really necessary and end up with a much more expensive product than they would normally have," Smith said.

Before finalizing technical specifications, Smith recommends that businesses work with potential suppliers to make use of their experience. Both sides can benefit from this approach - the company determines the best application for the project, while the supplier can develop a sensible set of requirements. In cases where the business has to develop a kiosk program, but is not clear what the kiosk should include, it can describe requirements to the potential supplier, who can then suggest what might work best.

Businesses also sometimes fail to grasp that manufacturers need time to dissect an RFP. Smith said his company was once given two days to respond to an RFP for a large kiosk project.

"That's totally unrealistic," he said, noting that businesses should expect two to four weeks before hearing back from a supplier on an RFP. "Two days is impossible for a major project."

What makes a good RFP?

Teamwork - between IT and marketing departments as well as between businesses and suppliers - is essential in the RFP process. But there are other ways to make an RFP more viable.

Sullivan offered three objectives that kiosk-related RFPs must convey: information, transactions, and relations.

The kiosk should provide users with accurate, up-to-date information on the products or services a company offers. IT can be easily used and does not require another layer of interpretation by the user.

By making kiosks transactional, the consumer will use the kiosk in a retail setting because it offers them another level of convenience and value.

Making kiosks relational helps address an organization's larger strategic picture of how consumers or interact with the business or groups of businesses.

Above all else, however, your RFP should show a potential return on investment, McGrady said.

"If you don't have a well-defined business plan and you haven't given a lot of thought to where you've going with the project, it's difficult to get it off the ground," he said.