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9 of the best due diligence questionnaire (DDQ) examples

9 of the best due diligence questionnaire (DDQ) examples

Recently, you may have noticed an increase in due diligence questionnaires (DDQs). When you respond to them, it’s crucial to […]


Category: Author: Tim Nicklas

In his role as a Senior Enterprise Account Executive, Tim empowers organizations with the knowledge and technology they need to enhance efficiency, improve win rates and grow revenue. He is passionate about life-long learning, leadership and collaboration. Leveraging years of experience in software sales, Tim partners with customers to explore their response challenges and create solutions tailored to help them meet their goals.
9 of the best due diligence questionnaire (DDQ) examples

9 of the best due diligence questionnaire (DDQ) examples

Recently, you may have noticed an increase in due diligence questionnaires (DDQs). When you respond to them, it’s crucial to get it right. Traditionally, a DDQ comes into play when an organization is considering an investment, completing a merger or assessing an acquisition. In addition, the due diligence questionnaire is now commonly used for vendor risk management.

With the increased prevalence and importance of due diligence, this refresher on DDQ basics will help you feel confident when you encounter your next one. And, with a few real-world examples, responders can improve their process.

In this post, we’ll explore the definition of due diligence, the importance of the due diligence questionnaire, who issues them, when and why. Then, you’ll find a list of the most common kinds of due diligence questions. And, finally, we’ll offer our list of the best nine due diligence questionnaire examples.

If you’re looking to optimize your response process with DDQ software, learn more here.

Jump to:

DDQ meaning: Everything you need to know

Before we jump to the DDQ examples, let’s cover a few basics. When you respond to DDQs, it’s important to answer some basic key questions like: What is a DDQ? Why use a DDQ? and Who uses DDQs? This background information will help you answer questions more efficiently and effectively.

What is a due diligence questionnaire?

A due diligence questionnaire, referred to by the acronym DDQ, is a list of questions designed to evaluate aspects of an organization prior to a merger, acquisition, investment or partnership. Sometimes, the due diligence questionnaire is called the due diligence checklist.

Investopedia defines due diligence as “an investigation or audit of a potential investment or product to confirm all facts, such as reviewing all financial records, plus anything else deemed material. It refers to the care a reasonable person should take before entering into an agreement or a financial transaction with another party.” It’s important to note that issuing a due diligence questionnaire is just one part of the much larger due diligence process.

Why do companies issue DDQs?

The goal of a due diligence questionnaire, like a security questionnaire, is to reduce risk. As a part of an investigative process, the DDQ simplifies the collection and delivery of important information that will inform the transaction. For example, the questionnaire may ask about an organization’s financial information, security policies, contractual obligations, personnel, pending legal matters and regulatory compliance.

DDQs enable organizations to gather large amounts of data quickly and efficiently. Likewise, it streamlines the disclosure process for companies providing information. While there’s no standard due diligence questionnaire, variations of the questionnaire are used globally. Consequently, many DDQs will have overlapping categories and questions.

Who issues due diligence questionnaires?

While DDQs aren’t unique to one industry, they are most extensively used in technology, government and finance. Indeed, the most common version of this questionnaire is the finance DDQ.

Additionally, you may find organizations using other DDQ variations including:

  • Vendor due diligence questionnaire
  • Private equity due diligence questionnaire
  • Third-party due diligence questionnaire
  • Hedge fund due diligence
  • Investment manager due diligence checklist
  • Technical due diligence
  • ESG due diligence

On an individual level, many roles work together to create, issue and analyze due diligence information gathered in the DDQ. Indeed, a mix of financial, legal, mergers and acquisitions, analysts, compliance, IT and procurement professionals may participate in the process.

When do companies issue DDQs?

The due diligence process is intentionally and necessarily complex. Indeed, it is designed to dig up details and surface insights that may otherwise be overlooked. So, a DDQ isn’t a good all-purpose, information-gathering tool. It delivers the most value in the following situations.

Mergers and acquisitions (M&A) due diligence

Due diligence is crucial in M&A transactions. Prior to completing the transaction, the buy-side organization must verify that the investment is sound and will likely pay off.

Typically, the questions cover general company records, personnel information, financial data, current contract obligations and legal matters. If a company is deciding between several similar opportunities, the information can be used to compare business risks and value side by side.

Investment due diligence

Due diligence questionnaires are useful in a variety of investment situations. For example, common projects well suited to the process include some of those listed above like hedge fund due diligence, institutional investment due diligence, IPO due diligence and venture capital due diligence. Investment due diligence questionnaires explore topics like company founders, customer and supplier information, intellectual property and competitor analysis.

Vendor due diligence

The term vendor due diligence has two distinct meanings. Once you know the difference between them, it’s easy to identify each within the context of their usage.

Proactive sell-side due diligence

When a company intends to put their business up for sale, and they expect to have more than a few interested parties, they may conduct a proactive due diligence exercise. In this situation, the term refers to completing the due diligence process to investigate risks within their own company. Often, all prospective buyers receive the resulting information once they’ve signed a non-disclosure agreement (NDA). This practice speeds the sales process and allows the seller to avoid completing new DDQs for each interested buyer.

Third-party risk assessment

The second type of vendor due diligence deals with managing the risk inherent in supplier partnerships. In this scenario, buyers issue vendor DDQs to potential suppliers. These DDQs are sometimes called third-party or vendor risk assessments.

As information security consultancy KirkpatrickPrice puts it, “No matter the vendor, they pose some level of risk to your organization – especially financial risk, operational risk, reputational risk and cyber risk – because they have access to your data, network, hardware, cloud and more.”

This vendor due diligence questionnaire requests information about vendor’s data security, financials, human resources policies and references. Vendor due diligence is often initially conducted as part of the request for proposal (RFP) process. In addition, the selected vendor must participate in ongoing due diligence.

Types of due diligence questions

To be effective, DDQs must be thorough. The responses must provide enough information to empower buyers to confidently determine whether or not to move forward. This means identifying risks, then taking action to either deem them acceptable, mitigate or avoid them.

Each DDQ is different, depending on the kind of project. And in some cases, a questionnaire may focus entirely on a particular type of due diligence. Financial DDQs, operational DDQs, IT DDQs and vendor DDQs are the most common examples of these category-focused, stand-alone questionnaires.

However, more often, the questions required for a comprehensive DDQ fall into several categories. These categories are subsequently centralized into a single document to suit the engagement. For instance, a hedge fund due diligence questionnaire will use a different combination of questions than an IPO due diligence questionnaire.

Categories of due diligence questions

  • Company questions
  • Founder and company background
  • Shares and ownership information
  • Employee information
  • Environmental factors
  • Diversity and inclusion initiatives
  • Legal overview
  • Financial and debt statements
  • Consumer/customer information
  • Industry and market insights
  • Intellectual property
  • Competitive intelligence
  • Real estate and property holdings
  • Operational information
  • Regulatory compliance
  • Data security and privacy
  • Contractual obligations
  • Administrative information
  • Reputation and publicity reports
  • Information technology systems
  • Tax history

Sample due diligence questions

So, what DDQ questions should you expect to answer? Naturally, it all depends on the engagement and your circumstances. However, here are some common questions that may be asked in a DDQ.

Due diligence questions for investment funds

  • What is your overall strategy or approach to responsible investment?
  • Which disclosure initiatives influence client reporting for this strategy?
  • What international and industry standards or guidelines do you follow?
  • How does your organization audit the quality of your policies?
  • What stewardship methods does your organization use?

Vendor due diligence questions

  • Do you have a business continuity plan?
  • What is your pricing philosophy? How often do your prices change?
  • Describe your employee screening and background check procedures.
  • Do your systems meet our compliance and regulatory requirements?
  • How and where do you store data, both ours and your own?

Operational due diligence questions

  • Have you performed due diligence on your current vendors?
  • How often is your information security policy reviewed and updated?
  • Does your firm have a disaster recovery solution in place?

Intellectual property (IP) due diligence questions

  • List all law firms that manage IP matters for your company.
  • Which patents, patent applications and trademarks relate to the transaction?
  • What confidentiality, nondisclosure or proprietary rights agreements are in place?
  • Are there any product or IP-exclusive rights that have been granted by your company?

9 best due diligence questionnaire examples

Due diligence questionnaires are long and complex, but there are a lot of commonalities, especially within categories.

Below are nine of the most common types of DDQs with sample questions that could help you prepare for the next time you are asked to respond to a DDQ.

1. Limited partners DDQ

The Institutional Limited Partners Association (ILPA) provides a thorough, and periodically updated, due diligence questionnaire. The original document pulled questions from more than a dozen real-world questionnaires provided by limited and general partners as well as third parties. The downloadable DDQ example is available in Word and PDF formats.

It covers 14 crucial areas:

  • General firm information
  • General fund information
  • Investment strategy
  • Investment process
  • Team
  • Alignment of interest
  • Market environment
  • Fund terms
  • Firm governance, risk and compliance
  • Environmental, societal and governance
  • Track record
  • Accounting, valuation and reporting
  • Legal and administration
  • Diversity and inclusion

2. Hedge fund due diligence questionnaire

Principles for Responsible Investing (PRI) is an organization founded by institutional investors to promote responsible investment. The group provides investment tools including their own DDQ checklist example. Helpfully, PRI offers a transparent overview of the questionnaire development process. 

PRI’s recommended hedge fund DDQ contains four categories:

  • Policy
  • Governance 
  • Investment process
  • Monitoring and reporting

3. Business relationship DDQ

MISC issued this due diligence questionnaire example to ensure organizations meet their ethical standards. The questionnaire details their expectations as well as the documentation they require for compliance. MISC goes on to explain its commitment to risk management, saying:

“The due diligence process of clients lies at the heart of minimizing MISC’s risk exposure as a result of activities carried out by MISC on clients’ behalf. At minimum, the due diligence exercise on our client is to ensure that the activities performed by MISC on behalf of the client will not breach our own CoBE’s requirements.”

4. Correspondent banking DDQ

The Wolfsberg Group created a helpful correspondent banking DDQ. This due diligence questionnaire focuses on banking compliance and is designed specifically for public sector organizations. The DDQ contains questions regarding compliance in areas like anti-bribery and corruption, sanctions policies and risk management.

In addition, the Wolfsberg Group provides guidance documentation, PDF and Excel versions of the template as well as Spanish and Japanese language versions.

5. Investor and consultant DDQ

This comprehensive investor and consultant DDQ provided by INREV is a hefty 41-pages long. The INREV association is dedicated to promoting best practices, sharing knowledge and increasing transparency in the non-listed real estate investment industry. 

INREV’s DDQ aims to assist “investors and consultants in the due diligence process to understand a fund manager’s structure, strategy and non-listed real estate business. It also gives insight in a specific vehicle’s strategy, risk processes, management, terms and projected performance. With it, investors can determine, in principle, whether a proposal fits their investment objectives.”

Their due diligence questionnaire template is attractive, highly organized and easy to use. The INREV website also provides helpful appendixes, translations and tools. Download it all in Word to inspire your next DDQ.

6. Environmental, societal and governance (ESG) DDQ

Invest Europe uses this sample DDQ to provide help for general partners as they seek to identify risks and maintain best practices in investing. While other questionnaires on our list deal with investment and finance concerns, this document focuses on environmental and social responsibility. 

Ultimately, organizations can use the questions in this DDQ example to identify potential issues that may need further attention. Luckily, this questionnaire is helpful both before and after the investment, so there’s no wrong time to use it.

7. IPO due diligence checklist

The days, weeks and months leading up to an initial public offering are absolute chaos. Getting the right information into the right hands at the right time can make or break your venture. However, organizations can prepare by exploring this extensive due diligence checklist provided by Find Law.

8. M&A due diligence checklist

LexisNexis created this comprehensive M&A due diligence checklist guide. Organizations can choose from their list of common requirements to fit the unique needs of each project. Choose from these 14 categories and nearly 100 checklist items to create your own ultimate DDQ template.

  • Basic corporate documents
  • Security issuances
  • Shareholder information
  • Material contracts
  • Patent and trademark matters
  • Manufacturing
  • Operations
  • Sales and marketing 
  • Tangible property
  • Litigations and audits
  • Environmental issues
  • Employees
  • Management
  • Other

9. Vendor due diligence checklist example

Procurement professionals are responsible for maximizing value while reducing risk. It’s tricky. Luckily, the best vendor due diligence checklists make finding the right fit easier. So, next time you’re issuing an RFP with a vendor DDQ, check this one-page DDQ list from KirkpatrickPrice to make sure you’ve covered all your bases.

How Responsive can help

We know that responding to DDQs is time-consuming ⁠— that’s why our customers use our RFP software to manage the process.

The Responsive platform empowers you to answer DDQs quickly

  • Organize content in a single knowledge library and quickly add answers to any DDQ
  • Use AI to automatically suggest the best responses
  • Assign, manage and track workflow tasks and deadlines
  • Improve collaboration and compliance so the people work on and approve DDQs
Proposal automation guide: Benefits, uses, tips & software

Proposal automation guide: Benefits, uses, tips & software

For most bid and proposal professionals, working through the steps of answering RFPs is second nature. Unfortunately, for those using manual processes, much of that work is tedious, repetitive and time consuming. Indeed, you may be all too familiar with the ctrl+f, ctrl+x and ctrl+v loop of working in Word and spreadsheets. Luckily, with proposal automation solutions, you can make the process faster and easier. Not to mention, you’ll be able to give those well-worn keyboard shortcuts a rest.

Powered by rapidly-advancing AI technology, the number of bid and proposal management tasks that can be partially or entirely automated continues to grow. For organizations looking to speed up sales cycles, work lean and increase win rates, proposal automation  delivers a lot of value. Fortunately, RFP response software is purpose-built for managing RFP responses, bids and proposals — and it’s increasingly impactful, adaptable, accessible and affordable.

Understandably, the prospect of increasing automation may not excite you. In fact, it may raise uncomfortable questions. For example, you might wonder if your job is at stake, if it actually saves time and if it’s really worth it. In this post, I’ll strive to explore each of these concerns about proposal automation and more.

To start, we’ll begin with the definition of proposal automation as well as how it works. Then, we’ll cover which steps in your proposal process can be automated and how human input is still required. Next, you’ll learn the three primary benefits of automation. I’ll also share a quick buyer’s guide for proposal automation software. And finally, I’ll share a few ways your team can prepare now for proposal automation in the future.

What is proposal automation?

Proposal automation is the use of technology to perform actions in the proposal process with reduced human intervention. Sometimes called bid automation, the term refers to the actions that technology performs automatically according to established rules.

Proposal management software includes  automation capabilities designed for the RFP and proposal process. It can assist with proposal completion, formatting, workflow tasks and content management.

How does it work?

Certainly, proposal managers don’t need to understand the engineering and code that makes proposal automation solutions work. However, a basic grasp of the concepts and logic behind automation is helpful. With this knowledge, users understand how to maximize automation’s value. And, they can troubleshoot if needed.

With origins in manufacturing lines, automation has come a long way in the last few decades. While technology continues to push the boundaries of automation, the basic motivations remain the same.

Whether automation is moving car parts from one assembly line to another, or transferring information from a content library to a proposal draft, the goal is to reduce the human effort required to complete tasks.

Proposal automation example 

Generally, automation works using if/then logic. For example, in the proposal process, you may want to send a reminder to your subject matter experts (SMEs).

So, the logic for that task could be stated as:
If SMEs have not approved their assigned questions by three days prior to the due date, then send a reminder email to their inbox.

In this case, the ‘if’ part of the statement defines the required conditions that must be met for automation to occur and the ‘then’ of the statement is the action that is triggered.

Each piece of automation requires several key pieces of data. For the simple automation in this example to work, the system needs to recognize and pull together all of the following data:

  • Users designated as SMEs
  • Which SMEs are assigned
  • Status of their questions (draft, in progress or approved)
  • Today’s date relative to the due date
  • SME email addresses for the notification
  • The notification text to be sent

When you understand that each element of the if/then statement is a piece of data, it’s easier to see the possibilities for new automations.

Beyond workflow automations like the example above, proposal and RFP response tools also use artificial intelligence, machine learning and natural language processing to expand and improve proposal automation capabilities.

Proposal automation uses and limitations

Just like other sales technologies, AI and proposal automation are tools that must be directed and used by humans. Certainly, it can save your team a lot of time, but it definitely won’t be able to replace you. Proposal expert Ashley Kayes, addressed the potential of automating proposals in a recent post on her Proposal Reflections blog saying,

“Will automation tools and AI eventually replace all of us and independently write the proposals for our companies? I think most of us agree that this will never happen in our lifetimes. However, I do believe that enhanced versions of these AI and proposal automation tools will ultimately empower our proposal teams to focus our efforts on tailoring content to meet the needs of individual customers and other critical tasks.”

We expect that AI capabilities and proposal automation will continue to advance in the future. In fact, at Responsive we’re constantly evaluating emerging AI and creating new ways to automate tedious steps of responses of all kinds including proposals, RFPs, RFIs, RFQs, DDQs, security questionnaires and so on.

When considering investing in proposal automation software it’s important to understand that these tools are not a replacement for people. They only work in partnership with users. However, when applied thoughtfully by skilled users, strategic response management software has the potential to cut your response time in half.

Examples of how proposal automation partners with people

Automating proposals effectively means balancing AI’s ability to perform mundane tasks with the need for human input and interpretation. Here you’ll find a list of ways you can use automation as well as short explanations of how users must provide input for the best results.

– Bid selectively and ensure compliance –

Automation can: Analyze and organize requirements

When receiving long-form RFPs and customer requests, it can be difficult to identify each individual requirement you must to meet. Fortunately, proposal automation can sift through the text of any request and create a list of requirements you can review at a glance.

With a clear list of the customer’s needs, you can more confidently decide if the opportunity is a fit for your company. Then, you can also use this list of requirements to ensure that the RFP responses and proposals will meet the customer’s guidelines and expectations.

Users must: Review and confirm the analysis

In this use case, proposal automation works by searching for keywords like shall, may, should, must and more to gather requirements. It does a good job of listing individual requirements, but a human must always verify the output for any requirements that didn’t use one of the established keywords.

– Find content and answers faster –

Automation can: Identify repeat questions and suggest answers

One of the most impressive and valuable features of RFP automation software is the ability to import an RFP and automatically review it for repeat questions. Not only will automation identify the questions you have encountered before, but it will also suggest relevant answers from your content library. So, you no longer have to search through endless emails and old proposals to find the right answers.

When considering investing in proposal automation software, it is important to understand how each automation tool works to find relevant answers. Some systems use exact match searches, while others leverage AI, machine learning and natural language processing to find synonyms and related knowledge records.

Users must: Select the right answer with context in mind

While AI can suggest the best answer and offer alternative options, it can’t yet fully understand the nuance and context for the request. So, it’s essential to have a human review the options. Certainly, it still saves time by providing you with all of the relevant choices, but final selection should be done by a proposal professional.

– Help write and edit responses –

Automation can: Create a first draft or revise an answer

Staring at a blank screen can be a roadblock for SMEs, so offering a first draft can help get them started — AI can help with that. In addition, if you get their response back and it’s a little too long and technical, AI can help with that too. With the GPT assistant in Responsive, you can leverage AI to create response drafts, expand short answers, transition from passive to active voice, improve readability, shift from technical jargon to plain speech and more.

Users must: Review, customize and fact check

Outputs from the GPT assistant sound more like a human than ever, but don’t be fooled. AI cannot create content tailored to your organization. Because GPT is trained using general information like internet content and books, it doesn’t know your brand’s proprietary information, competitive advantages, messaging, tone or style preferences.

Users must still infuse responses with compelling win themes, create a consistent style and update automated responses to ensure accuracy and effectiveness.

– Keep your content library clean –

Automation can: Identify potential answer duplicates

As you answer more RFPs, create proposals and leverage your response solution, your content library will grow. Naturally over the course of time, you’ll respond to variations of the same question over and over. Then, if you’re not careful to review, prune and consolidate similar responses the library can grow out of control and become difficult to navigate effectively.

Fortunately, AI can help you manage the content by identifying similar question and answer pairs. The system can then flag the content for potential deduplication.

Users must: Review duplicates and make the final call

Typically, duplications are created when an answer has been customized to fit a particular customer or situation. AI can identify the similarities to other responses, but it can’t decide which answer is the best option to keep for future use. Users must provide input to combine, edit and optimize the responses before deleting duplicates.

– Improve SME collaboration –

Automation can: Send reminders and schedule reviews

We all know that as the proposal coordinator, you spend a significant amount of time wrangling answers and approvals from various subject matter experts and stakeholders. Often, this means countless emails, follow-up calls, chat messages and reminders. And managing that communication via email is cumbersome and risky. Fortunately, all of these activities are centralized in automated proposal software.

As you work through the proposal, SMEs receive notifications when you assign them questions, request reviews, send reminders and secure final approval. In addition to avoiding sending these communications manually, the platform also retains a record so you can review the process if questions arise.

Users must: Manage assignments, responsibilities and settings

Proposal automation isn’t able to identify who plays which role in the response process without your help. Indeed, for large organizations, the number of variables that determine who contributes to a proposal or RFP make it far too complex for a computer to understand. However, for you, it’s a simple matter of matching sections and questions to the relevant users.

– Keep momentum moving to meet deadlines –

Automation can: Track real-time progress

When your boss wants an update on how the proposal is coming together, automation has an immediate answer. Rather than reaching out to every contributor and finding out the status of their work and compiling a report that will be out of date before you can even send it, proposal automation software enables you to see real-time visualizations of each project.

Users must: Interpret and optimize

While dashboards and reports are much easier to create and view in proposal software, they lack the context and big-picture view you provide. The real-time information can help you identify bottlenecks, but it won’t be able to determine why they’re happening or how to fix them. There’s simply no replacement for the strategy and process insight you provide.

– Surface data insights –

Automation can: Gather data and schedule maintenance

Curious how often subject matter experts make adjustments to answers from previous proposals? Wondering when the last time was someone reviewed your compliance content?

Proposal automation tools collect this information as well as other helpful response metadata. In addition, you can set up periodic, automatic review cycles to prompt SMEs to verify and refresh the content they’re responsible for.

Users must: Review and optimize

Proposal automation can only provide you with the information it finds in your content library, it can’t verify if that information is still true and accurate. In addition, it can’t warn you that one of your answers has a bullet point that isn’t relevant to the customer or refers to a contact that has since left the company. Indeed, when it comes to avoiding embarrassing moments like that and ensuring you’re using timely responses, there is no replacement for your careful review.

Additionally, users must determine how often content should be reviewed and who should review it to minimize risk.

The 3 biggest benefits of proposal automation

At the end of the day to be truly worth it, proposal automation must deliver value to the bottom line. There are three primary benefits to consider.

1. Enhanced efficiency

Automation saves time (a lot of time). RFP responses are an investment, so as efficiency increases, so does profit. When you leverage automation, you spend significantly less time finding information, sending reminder emails and verifying responses. In the time you save, you can take on more strategic, higher-value projects.

For example, Crownpeak leverages proposal automation to complete the majority of their responses:

“Today we’re filling out 80% of an RFP with Auto Respond. But next time we get an RFP, that percentage might be 81%. The more answers we put in the library, and the more RFPs we respond to, the more accurate Auto Respond becomes,” -Paul Taylor, Vice President of Solutions Engineering at Crownpeak

2. More consistent processes

Automating proposals using an established, repeatable process in a centralized location provides much needed organization and clarity. Manual responses often involve information that’s shared through email, spreadsheets, calls and more ⁠— this siloed knowledge increases the risk that your proposals contain inaccurate or inconsistent responses.

3. Data capture and analytics

Each RFP and corresponding proposal contains a wealth of data. Indeed, data collected from automated processes enables organizations to calculate proposal software ROI. In addition, RFP data analysis uncovers avenues for process improvements, pricing optimization, sales messaging refinement and more.

Proposal automation software buyer’s guide

Finding the right proposal automation solution for your organization can deliver tremendous value. So, here are a few things to discuss with your team before making a purchase.

Essential proposal automation software features

  • Centralized content library: How is information saved, organized and reviewed? Is the library easy to navigate and use for power users and occasional SME contributors alike?
  • Response automation: When you upload an RFP or request, does the platform suggest relevant answers automatically?
  • Request import: Are requests quick and easy to upload? Does the software consistently identify sections and questions?
  • Project management tools: How can proposal managers track their projects, engage collaborators and ensure on-time delivery?
  • Integrations: How will the proposal automation solution integrate with existing processes and sales technologies?
  • Data analysis: Does the platform capture key metadata, have helpful reporting capabilities and detailed audits for transparency and risk management?
  • Document tools: Does the platform offer tools for e-signature, document library management, embedded media and attachments?

Additional considerations

  • Solution updates and enhancements: Does the platform keep you ahead of trends and give you a competitive advantage with regular releases designed to improve your process?
  • Reputation: Is the company a leader in the industry? Do they have strong reviews from users?
  • Customer success: What kind of support will your team need?
  • User experience and adoption: Is the tool easy to use, navigate and understand?
  • Broader value: Is the platform flexible enough to be used for additional use cases?
  • Security and controls: How does the software manage security and data? Do they allow various user permission levels to keep information secure?

How to prepare now for automation in the future

While automation can undoubtedly save almost any proposal team time, some organizations may not quite be ready to make the investment. However, that doesn’t mean there’s nothing you can do now. First, create a business case for proposal software. Then, begin building the foundation for successful automation.

Map your current proposal process in detail

Creating a detailed, step-by-step map of your process is the best way to identify areas that are ready for automation. Start at the beginning. What steps happen when you receive a new RFP? Who is involved in the decisions? What information is gathered? Who plays which role in proposal creation? And so on.

Benchmark key metrics

After you’ve defined your process as thoroughly as possible, estimate and note the hours required to complete each task. Consider what steps take the longest and which are the most repetitive. This exercise will point you to the areas where automation will be most impactful. Not to mention that benchmarking the time and cost involved in RFP responses allows you to calculate return on investment once you adopt a solution.

Plan how you will redirect time saved

Another powerful way to prepare for automation is to consider what you will do with the time you save. We all have a list of projects and ideas in our heads, and with automation, you’ll be able to put them into action. If nothing comes to mind, we have a couple of ideas to further improve your efficiency and effectiveness.

Dig into your data

The more information and historical RFP response data you have, the better off you’ll be when you are ready to adopt proposal automation. Explore your proposal library and identify knowledge gaps as well as any opportunities to improve the quality of your data.

  • Remove duplicate and outdated answers
  • Ensure on-brand messaging
  • Improve consistency in tone, word choice and style
  • Record which answers appear in winning proposals
  • Identify commonalities in won and lost opportunities

Final thoughts

Despite all the advances in automation for proposal teams, the RFP process is still human. At its core, it’s still about connecting people and finding customers that will help you reach your goals while you help them reach theirs.

Again, Ashley Kayes, sums up the potential of proposal automation nicely saying,

“Leveraging these tools effectively in the future, I believe we will increase the efficiency of our business development and proposal process by automating some of the most time-consuming pieces of the process and helping us to make smarter, more-strategic decisions on the opportunities we pursue.”

There can be no doubt that automation is part of the future of RFPs. But, the real question is: Will you be ready? Are you ready now?

Business proposal example, template, and how-to instructions

Business proposal example, template, and how-to instructions

Before I get into the business proposal example, template, and tips, I need you to remember one thing: You’re Yoda, not Luke Skywalker:

“Think about Luke Skywalker and Yoda in Star Wars. When Luke meets Yoda, he encounters the perfect guide. Yoda understands Luke’s dilemma and has mastered the skills Luke must develop if he is going to defeat the Death Star.”
Donald Miller

As the writer of a business proposal, you want to come off as the perfect guide. Your goal is to make your prospect look like Luke Skywalker, the hero of the story. The prospect doesn’t care about your product; they care about solving their problem.

What is a business proposal?

Put simply, a business proposal is your solution pitch to a prospect’s business problem. It’s you saying, “I understand your problem. This is what the situation will look like after it’s fixed. Here’s a few ways we can help you fix it. Sign here to get the solution rolling.”

It’s used often, especially if your prospect isn’t the only stakeholder involved in deciding whether or not to buy your solution. In such situations, the business proposal is the document that your prospect will share with those decision-makers. Jeff Bloomfield, sales coach and author of NeuroSelling, says, “They need to know that they are saving money with your solution when compared to the high cost of the problem you are solving.”

As succinctly as possible, you need to tell the story of how your solution will help your prospect look like Luke Skywalker. That’s not much room; the opening scroll in all the Star Wars movies takes up more than two pages.

A business proposal is brief, yet informative and customized to every prospect’s specific problem, even if you only have one solution. Remember this is about their needs rather than your features. To put it another way, it’s the photo negative of a brochure or website.

How to write a business proposal

Arguably the most important step when writing a business proposal takes place before any writing begins: Confirm interest in your solution. Odds of winning deals from unsolicited business proposals are multi-state lottery-level. Any effective business proposal starts with a conversation.

When you understand objectives and have a solution, then you can begin writing. If after identifying the prospect’s pain points you believe that your solution isn’t strong enough, then keep digging for the pain points where you can excel. Sometimes you have to push to get the right objectives to make sure there’s enough pain to justify your solution.

Timing is essential because a business proposal needs to be educated and comprehensive. Too early and it’s going to land on deaf ears. Too late and either someone else solved the problem or you’re perceived as not caring enough to make it a priority.

As soon as you’ve identified pains, objectives, and how to position your solution as the ideal, then gather the following content:

  • Logos (yours and prospect’s)
  • Pricing options
  • Scope of work collateral you can link to from the business proposal

Now you just have to complete the business proposal template. These business proposal best practices will help.

8 business proposal best practices

  1. Take advantage of “title” real estate. As my esteemed colleague Keith Norrie explains in his expert advice on executive summaries, the title is too good of a setup opportunity to pass up. Use an action verb to surface the primary problem that you’re proposing to fix with your solution. The following power-verb examples will perk up stakeholders’ ears: increasing, reducing, accelerating, improving, streamlining, monetizing… Check out the business proposal example to see how I framed the solution in the proposal.
  2. Agree on 3-5 objectives with the prospect’s champion during your initial calls. These objectives will be based on pains that your prospect wants to overcome.
  3. Explain how your solution will enable these objectives. This isn’t an opportunity for you to list product features—most of which the prospect won’t care about. It’s where you tie solutions to problems. For example: “RFPIO’s AI-enabled Content Library will reduce XYZ Company’s time spent responding to repetitive questions from 1,200 hours to 720 hours or fewer annually for an equal number of submitted RFPs.”
  4. Give multiple pricing options as a checkable list. Avoid line-item detail. Explain the difference between each option. For example, “This one allows you to scale…this one gets you to the end of the year…this one is best for small businesses…”
  5. Provide a high-level scope of work specific to the prospect’s need. Link out to data sheets or websites for more information.
  6. Include a call to action, preferably a signature request. At the very least, schedule a call to review next steps.
  7. Review the proposal with the prospect over the phone or through video conferencing. If possible, try to get the person you’re really building the proposal for (the decision-making stakeholder in the shadows behind the prospect champion) to join the review. If you can’t schedule a review, then record a Vidyard of you walking through the business proposal that can be shared with stakeholders.
  8. Be careful of jargon. Every industry has its unique terminology, but be wary of using jargon for jargon’s sake. With only two pages, you don’t have any room to waste on hollow language that doesn’t address the prospect’s specific problem.

Download your business proposal template & business proposal example

Here are the business proposal template and the business proposal example. When you’re ready to write your own business proposal, make a copy of the template. Then, delete all the instructions as you complete the sections. That way you don’t accidentally fire off a document complete with my tips and tricks. Also, if you build your business proposals from Salesforce, then these tips on Salesforce Proposal Builder will be a big help.

I hope you find the template and example helpful. Remember, the decision-making stakeholder (likely an executive) will be reviewing multiple proposals. They should be able to look at yours and identify that it’s comprehensive and customized for them. They’ll sniff out cookie-cutter treatments immediately and will sideline them while they look for something unique, like yours.

Be confident. This isn’t a shot in the dark. The prospect needs to solve this issue. Your business proposal will illustrate how you’ve thought through their problems.

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