Why RFP when you can MVP?

05-11-2018 Dennis Zuurhout

Of all business processes, procurement is arguably the one least touched by the technological revolution. Sure, in the Dark Ages - and I mean the 1970s - you had to send your Request for Information through the post. Then you got to fax it. And now your RfI reaches potential suppliers at the speed of light, or almost. Is that progress? You’ve thrown away the stamps, but the procedure itself is intact. You still have to jump through the same hoops.

The reasons for this are understandable. Organizations want to spend money carefully and intelligently. A formal procurement process is never convenient but it achieves two important things: it vets potential suppliers and forces organizations to consider carefully what it is they need. 

You don’t want to waste your time or anyone else’s by requesting information about functionalities you will never use. Worse still is to miss out a requirement that will prove to be indispensable to your business model. So a lot of serious thinking needs to happen before you are ready to finalise that RfI.

And then? Shortlist! You invite three suppliers and make a formal proposal to win your business. In your Requests for Proposal, you have to be very detailed and specific about what you are looking for because an RfP is in effect a blueprint for the project itself, and the basis for a formal quote.

Speed up procurement

How useful is an RfP in e-commerce? Most if not all B2B or B2C organizations have particular needs for their platforms. Off-the-shelf or one-size-fits-all does not exist in e-commerce. In other words, the response to your RfP is in large part an argument about a vendor’s capabilities to adapt its solution to your needs. You will almost certainly require a Proof of Concept to gauge if the vendor can actually deliver what it promised. And even then, it’s still a leap of faith.

An e-commerce platform or re-platforming project is inevitably a development project, so perhaps we ought to look to the software development industry for a more agile approach to procurement.

App developers like to release what is called a Minimal Viable Product (MVP). The keyword here is “viable”. An MVP is a complete and working product, not an immature version of an app yet to be written. The analogy that is often drawn is that of a cupcake, which is delicious in its own right, and not in any way a beta-version of a wedding cake. If you enjoyed the cupcake, you may want to ask the confectioner to bake you a wedding cake with all the decorations that your heart desires. 

This is how developers use MVPs: to see where they can next take the app, what did users like/not like, what bells and whistles should be added and so on. But isn’t that what you want to know about your (new) e-commerce platform?

The benefits of a MVP for your commerce project

No amount of screenshots or technical specifications can match the experience of working with the actual software. An MVP gives you the core features, but this is an advantage because you want your own bespoke solution anyway. This stripped-down version of the platform brings great business focus to what add-ons you need; often these turn out to be different from the requirements you outlined in your RfI. An RfP can never give you such insight, because the responses you get only echo what you thought you needed. But an MVP is a much earlier encounter with reality, and can be trialled in the field, with real customers, giving real feedback and actionable insight.

Knowing what you want, and how the software “behaves”, shortens development time and speeds up implementation. The roll-out itself will be less bumpy not least because you have already developed a relationship with your customers, and with the product developers.

RfPs are deeply embedded in the way we all do business, and most public bodies and very large companies will find it difficult to break free. But for the rest of us, MVPs are really an agile and much more practical response to the challenges and pitfalls of procurement.

And who doesn’t like a cupcake?  

More information

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