Our Thinking: Tenders vs Value

By Kate Letheren, Partner ID-LAB Global

Tender applications are a reluctant task for us. On the surface, they seem to have numerous benefits. They allow for competition. They keep the door open to contestability. They offer (the appearance) of impartiality.

But tenders come with many drawbacks, especially for experts like us looking to push the envelope of what’s possible. 

Tenders almost always specify the steps that need to be taken, as well as the expected result; most often very specific. But, they do not allow for a discovery of the REAL problems, and with that, solutions that are outside their described ones.

It makes our work a commodity, instead of a strategic consultancy. The client demands to see how many hours people in different positions have been allocated, while at the same time expecting a fixed fee. What is the use of that? What about if we spend less or more hours? We cannot charge that. In the end, it is not about the hours we spend – it is about the value we create in the project. In fact, as a professional consultant, we would be punished for being effective – the more effective we are, the less we should be able to charge? No matter that our professionalism comes from years and years of experience, from a dedication to quality, from hiring, training, motivating and inspiring the best possible team members.

Being so specific with the information we have to provide most likely means that the tender is judged on the individual pieces of information, and not on the overall value that our knowledge or experience would add to the project (because they cannot 'score' experience and/or knowledge).

The status quo of many tenders looks set to remain a necessary step in our workflow, at least for the time being. We want to see the balance shift away from the ‘way it’s always been done’ to ‘how it could be done’.

In our view, a tender should ask for the solution to a problem. Leave it to us to develop a methodology with which this problem can be solved. Leave it to us help you come to a realisation of what the REAL problem is. The tendering party already describing WHAT the problem is, HOW the project should be approached, in HOW MUCH time, by WHAT type of people, is way too close to an argument with your specialist doctor about what Dr Google has told you…