Good news: your consulting firm has been asked to submit a proposal by Phil Yerwiech, CEO of herb eradication giant, Thyme Begone.
Bad news: developing that proposal will consume time, and you’re already busy.
What’s the most effort your consulting firm should invest in developing the proposal and/or proposal presentation?
Before we establish the cap on your proposal-development effort, review the list below.
How to Minimize Your Consulting Firm’s Proposal Development Burden
- Follow a codified process for discovery and proposal development.
- Offer completely/mostly standardized engagements.
- Maintain a library of common approach “modules.”
- Create fill-in-the-blank templates for the Context portion of your proposals.
- Create boilerplate proposal language for standard proposal sections (e.g., Terms, Accountabilities).
- Co-develop the proposal with the prospect, or confirm all elements of the engagement during discussions before capturing them in the proposal. (Keeping in mind, your discussion time counts as proposal-development effort.)
- Avoid lengthy, complex RFPs.
- Forget you owe a proposal until three weeks after the proposal was due. (Not a winning strategy, but it does reduce labor intensity!)
As you can see from the list above, standardizing and systemizing the proposal process will reduce your consulting firm’s labor intensity. That said, some opportunities do deserve more customization time and effort in the proposal-development stage.
Therefore, create three proposal development levels that differ by amount of effort and customization.
The value of the potential project/client determines the maximum proposal development level. Small projects warrant a Level 1 proposal. Huge projects justify (but don’t require) a Level 3 proposal.
What projects qualify as small or huge depends on the size of your firm, of course. Would a $100k project make your year or is it below your minimum project threshold? The guidelines below include a rough benchmark that should serve for most readers who run a small consulting firm.*
3 Levels of Proposal Development
Level 1 Proposals
Discovery Effort: Low. Collect required information via template. (<30 minutes)
Proposal Customization: None. Use boilerplate offering descriptions. (0 minutes)
Presentation Customization: Low. Send standardized cover letter. (<10 minutes)
Total Time: <40 minutes
Typical Project Size for Small Boutique: <$25,000
Level 2 Proposals
Discovery Effort: Moderate. Follow Context Discussion process. (<90 minutes)
Proposal Customization: Moderate. Write custom Context and include standardized approaches with minimal changes. (<90 minutes)
Presentation Customization: Low. Send standardized cover letter. (<10 minutes)
Total Time: <3 hours
Typical Project Size for Small Boutique: <$200,000
Level 3 Proposals
Discovery Effort: High. Conduct substantial research and/or reconnaissance. This can involve analyzing public data, buying and analyzing private data, conducting interviews among client personnel, customers, and other stakeholders, etc. (<25 hours.)
Proposal Customization: Moderate. Start with standardized approaches as much as possible, customizing as necessary; after presentation (see below), summarize collaboratively-developed proposal. (< 4 hours)
Presentation Customization: High. Present a data-based assessment of your prospect’s situation, revealing new insights and tying your findings to your recommended approach The presentation must be collaborative and at least 50% inquiry. (< 10 hours.)
Total Time: <39 hours
Typical Project Size for Small Boutique: >$200,000
Just as in setting fees, determining your minimum project size, and choosing desserts, there are always exceptions. There may be reasons to invest extra time in a particular proposal. For instance:
- You’re proposing a new approach that you plan to repeat often in the future.
- You’re using the proposal development process for staff development or training.
- The client and/or project is extraordinarily important for strategic reasons.
- The client is an ice cream or candy business.
What about RFPs? RFPs with a bazillion questions and data requirements can be a time suck. Use the same three levels outlined above. If your consulting firm responds to a lot of RFPs, then create a library of responses to standard questions.
How much time do you spend developing a typical proposal?
Text and images are © 2023 David A. Fields, all rights reserved.
Tip 1: vertical proposal (Word doc) much less time intensive – and often more effective – than a horizontal PPT proposal. Tip 2: rather than investing time in developing a detailed work plan for a project as part of the proposal (unpaid time), do that collaboratively with client during first couple days of the project (paid time).
Those are two good, time-saving tips, Will. Interestingly, I’ve found in some cases that a high-level PPT proposal along with a quick video can take less time than a Word doc. Plus, the video creates more connection with the prospect.
Totally agree on the detailed work plan, especially for more strategy-oriented consulting projects and definitely for non-competitive proposals. In more technical, IT-driven consulting projects, and in competitive bid situations, a detailed project plan often gives an important edge.
Will, your advice is always excellent. Thank you for sharing your ideas with me and other readers.
I’m curious about “Forget you owe a proposal until three weeks after the proposal was due”.
Could you please expand? Is this about seeing whether they want you enough to chase you, before expending effort on writing?
Thanks for another great article.
Alan, that “tip” was meant to be tongue-in-cheek… but perhaps the tongue missed the cheek! If you never work on the proposal, it takes less effort. Not something I’d recommend!
I do appreciate you asking, though, because it wasn’t clear before I made a quick edit to the article.
Thanks David. Maybe I need more coffee this morning!
Nice article David.
We also use what I would call a Level 0 proposal or concept note.
This is designed to be minimal written volume, maximum impact and particularly good for nascent/embryonic opportunities where client interest is high but budget to commission is unclear or difficult to access.
The goal is to remove any bells and whistles and simply show the client you completely get them and what they are seeking to do.
1 slide on their context
1 slide on what you think they should do
1 slide on how you think they should do it
It creates a simple but highly effective platform to move an early stage prospect forward in the sales pipeline.
I like that a lot, Patrick. A standardized, three-slide “proposal” definitely fits in the Level 1 bucket or, as you’ve termed it, perhaps Level 0. Well done!
I’m glad you shared what your firm does so that others can follow your example.
What strategies might I employ to attract more candy and ice cream clients? LOL’d when I got to that line, David!
Seriously, superb article! I like stratifying the proposal effort based on the opportunity size. I’d love to hear more about video proposals!
Hold on, Steve–you mean you don’t craft your firm’s entire marketing plan around attracting candy and ice cream clients?? (Seems like an odd choice to me, but I’ll go with it.)
There’s a certain irony in a written article about video proposals; however, that aside, you’re right–it would be a good topic. We’ll definitely put it in the queue. (And, of course, you can always give me a shout if you’d like to discuss how we use them.)
Thank you for sharing your reaction, Steve, and for making the excellent topic suggestion!
You could of course make a video about video proposals, David, and post it here in the blog.
David, thanks for another excellent article. Some years ago, I changed from using MS Word and Docusign for proposals to Pandadoc and found that it cut the work by more than half. Most of the work is in analyzing the context discussion and then writing the context document for the client to sign. (We call this the “discovery”.) After the client signs the context document, converting it to a proposal typically takes 2 – 4 hours.
Other benefits of templates are:
You reduce the number of “silly” errors that can erode trust, e.g., avoid the client thinking, “If there are so many errors in this proposal, what will they be like on my project?”
When we discover a new problem with our proposal, we immediately fix it in the template. That is how our proposals are continuously improved.
A quick example: Over the years, I have developed templates for “Risks and concerns” because the same issues come up repeatedly. Each issue has a description and then a section called “Remediation”. When I put the risks & concerns in the context document, I delete the Remediation section, but the proposal includes remediation.
The most significant limitation of PandaDoc is weak and convoluted access control. For example, I would like to use Panadadoc to send standard project content to clients, e.g., meeting agendas, etc., but I don’t want project managers to see the contents of agreements with those clients. I can get away with it now, but as we grow, it is likely to be a problem.
Great example of standardizing and automating the process, Chris. We have looked at quite a few software platforms that specialize in proposals and, at this point at least, none have knocked our socks off enough to recommend. They’re probably great for promotion agencies, housing contractors and IT implementation companies, but less so for management consultants.
More importantly, kudos to you for continually updating your standardized proposals. As a result, you’re more likely to win projects with less effort involved. That’s a great outcome, and I’m sure many other readers will want to emulate your success.