The virtual conference for Strategic Response Management  |  On Demand

Tender management explained

Written by
Wendy Gittleson
Wendy Gittleson
Updated on
  10 min read

When a business, nonprofit organisation, or government agency needs to make a major purchase, such as materials required to manufacture their goods or services to keep the organisation humming, they typically initiate a bidding process before zeroing in on their best option.

If the purchasing organisation is in the United States, the bidding process begins with a request for proposal (RFP). In many other parts of the world, the request is called a tender. In turn, the vendors respond with a proposal, or more commonly outside the U.S., a bid (or response).

In this blog post, we’ll take a deeper look at the tender management process and how organisations can optimise their purchasing outcomes.

What is tender management?

Tender management is the structured process of getting information from the market to make a purchase or responding to a request sent by another organisation to purchase from you. It is about ensuring that bids or purchases align with company values, needs, budgets, security and compliance requirements, and so on.

Tender managers are responsible for coordinating with department leaders to create a list of potential vendors and send a detailed questionnaire that covers everything from vendor history to purchase specifications to legal requirements. They may also be responsible for crafting bids in response to tenders.

Confusing? Perhaps, but it’s also worth noting that in many companies, tender managers both send and respond to tenders. To avoid confusion, let’s call the questionnaire a tender and refer to the response as a bid.

Bid vs. tender vs. proposal management

Bid, tender, and proposal management are often used interchangeably. Traditionally, bid and proposal management are synonymous. Both are about the process of responding to tenders (or RFPs).

Today, some companies use tender management to describe both the purchasing and bidding process.

Who participates in the tendering process?

There are generally several stakeholders involved in the tendering process. Tender response teams may include personnel from:

  • Sales
  • Procurement
  • Operations
  • Logistics
  • Finance
  • Human resources
  • Marketing
  • Legal
  • Information technology and security
  • And more

Additionally, larger companies may have a dedicated bid team, which might include a bid manager to oversee the entire process, a writer or two, and an editor.

How the tender management process works

As with RFPs and all other questionnaires a potential customer might send, tenders are detailed, specific legal documents with zero leeway deadlines. As such, it’s critical that companies design a repeatable response process before the next tender reaches their inbox.

Responsive’s response managers recommend an 8-step process:

Step 1 – Go/no-go

Tender response is a long process. It can take days and sometimes even weeks. To demonstrate respect for your time, that of your fellow stakeholders, and the company at large, initiate a selection process to determine whether the tender is winnable and aligns with your company’s goals.

The process should determine whether your organisation is willing or able to provide the product or service. It should also include reports to compare success rates of previous similar bids, whether similar bids you’ve won were beneficial to your organisation, and any available competitive research.

Step 2 – Hold a kickoff meeting

Gather your stakeholders to assign roles, responsibilities, timelines, and objectives. A project management platform designed explicitly for tender responses will help streamline the process and track progress.

Step 3 – 1st draft

Up to 80 percent of a tender’s questions are relatively standard. For example, questions about company history or your IT security protocols are common. Establish a well-maintained content library to store previous answers, so you can respond to those questions quickly, efficiently, and with marketing-approved content.

Ask subject matter experts (SMEs) to review their answers to ensure they are accurate and up to date. Ideally, you should involve them in periodic content audits to help simplify the response process.

Step 4 – 2nd draft

The second draft is the time to dig down and answer the remaining questions. You will need to involve SMEs to help craft responses to the questions that fall under their realms and your marketing department to ensure the answers meet brand guidelines.

Step 5 – Review and revise

Check that each question has complete, accurate, well-written, and proofread answers. You should also make sure that all relevant documents are attached.

Step 6 – Submit

Submit your polished response by the deadline or sooner. In fact, sooner is preferred in case there’s a glitch that requires you to submit it multiple times. Wait until you receive a receipt and let each stakeholder know.

Step 7 – Save and audit the responses

Record each answer in a centralised repository for use in future tender responses. You should also schedule routine content audits.

Step 8 – Hold a postmortem

Every response is a learning opportunity. Gather your team to gauge what went well and what didn’t.

Understanding the challenges of tender management

Even the best-designed tender response process has its challenges. The most common include:

Workflow

Without clearly defined roles and responsibilities, you might have people stepping on each others’ toes, or perhaps more likely, too few people willing to make the time.

Because tender response timelines are absolute, tracking progress is crucial. A robust project management platform that works with your existing tech stack will define roles, eliminate confusion, and help ensure each response arrives within the allotted time.

Collaboration

If your company is like most, you have work silos. Even if you don’t, your workforce might span the country or even the world. Effective collaboration is a must for tender response management. Look for bid software that integrates with your existing communication apps.

Disorganised content repository

One thing that will slow down the response process every single time is a nonexistent or disorganised content management system. Just to give you an idea of how much it can slow you down, a McKinsey survey found that average workers spent nearly 20 percent of their time tracking down information.

Because tender responses are legal documents that require coordinating with busy SMEs and input from your marketing team, 20 percent is very conservative. Some customers find they are as much as 5x more productive when they store their information in the Responsive Content Library.

Best practices for tender management

Now that you have a repeatable process in place, how should you specifically approach your next tender?

Understand the full scope of the project first

An essential part of the go/no-go process is understanding the customer’s request. When you assume rather than reading and comprehending the entire document, you risk alienating the buyer.

Only bid on tenders you can fulfil

Maybe your product or solution is a perfect match, but when you dive a little deeper into the tender, you find that you can’t meet their timeline or security requirements.

I’m not suggesting that you should always avoid bidding when you aren’t the perfect fit. Sometimes you want to put your name out there for future consideration, but be honest with the buyer right up front, such as in the cover letter. Otherwise, you could risk damaging your reputation.

But, as the expression goes, a bird in the hand…

In most cases, opt for the winnable deals. Most tender response teams, and especially SMEs, are extremely busy. Directing efforts toward realistic, revenue-generating opportunities is far better than those that might only be viable years from now.

Develop a collaborative response strategy

Two- and even single-person bid teams aren’t unheard of but uncommon. The typical tender response requires choreography that almost rivals the Royal Ballet. Alright, that’s an exaggeration, but collaboration is critical.

To strategically optimise collaboration:

  • Provide the right tools – The chances are that your company already uses one or more collaboration tools. Look for a tender response software that works with the tools people are already comfortable with.
  • Respect contributors’ time – Your SMEs each have different work styles. Some have more time than others, and some have more stored question-answer pairs. Respect contributors’ time and work styles to help foster future collaboration.
  • Clarify roles and expectations – Avoid team members getting in the way of each other by letting them know precisely what is expected of them.
  • Manage and organise tender content

As my mother likes to say, an ounce of prevention is worth a pound of cure. You should regularly audit your content library to weed out the ROT, or that content that is redundant, outdated, or trivial.

Engage your SMEs to check their own question-answer pairs. It’s a much lighter lift if you conduct periodic, such as quarterly, audits.

The role of tender management systems

Tender management systems help define, optimise, and manage the strategic tender management process.

What are the benefits of a tender management system?

A tender management system offers a structured approach for both buyers and bidders. In both cases, a structured system saves time, fosters efficiency, strengthens communication, and helps both parties achieve their goals.

More specific benefits include:

For the buyer

Creating a tender is arguably the least time-consuming part of the tender process, but it still takes a lot of time and effort. A tender management system lets buyers collaborate with the teams requesting the product or service and other stakeholders to ensure that all requirements are covered.

You may be able to pull similar tenders for reference from your content library.

For the bidder

The bid process is considerably more complex than the buying process in that bidders need to learn and follow the buyer’s rules. Thoroughness, accuracy, and quality are paramount. A tender management system helps ensure that bids are well-written, complete, accurate, in the buyer’s preferred format, and submitted on time.

Additionally, a well-curated content library benefits the entire organisation.

Tender management software

As businesses become increasingly selective while regulations such as GDPR add complexity, more and more organisations are looking for a future-proof tender management system.

Organisational structure has seen significant changes over the last few years. If employees aren’t working remotely, they’re often spread out over multiple locations and internal silos. All this is to say that collaboration tools have never been more critical. This is especially true for tender management teams whose members can come from any department. Some organisations even use freelancers to help write or for their expertise.

Since time management is necessary, tender management software should help ensure you never miss a deadline. It should work how you work but also stay within buyers’ parameters. And it should provide the data that fosters intelligent decision-making and proves its worth.

Tender response is about projects, not individual use. Individual licences inhibit collaboration and encourage skimping on resources. They also limit scalability. Look for a tender management system that grows when needed and scales back during slower times.

What to look for when choosing a tender management system

An ideal tender management system supports a strategic tender management process. Components should include:

  • Data – A strategic response requires data. An effective tender management system should provide customizable reports to assist with your go/no-go decision-making and informed business decision-making.
  • Automation – A tender management system is about accomplishing more while using fewer resources. Look for a system, such as Responsive’s auto respond or automated project management features, that intelligently works with you to boost your capacity and overall win rate.
  • Powerful integrations – Today’s CIOs prioritise consolidating their tech stacks instead of adding to them. Look for a system that integrates with your most essential tools.
  • A robust content management system – Your tender management system should not only direct you to the correct answers but also notify you of possible duplicates and outdated answers. Additionally, you should look for an accurate and comprehensive content repository for company use cases that extend far beyond tender management.
  • Import-export capabilities – Tenders arrive in various ways, including Word documents, spreadsheets, and PDFs. However, it can be difficult for multiple stakeholders to work within unknown categorising and formatting. A tender management system should be able to translate a tender into a format each user understands and revert the final product back to the original.
  • Customization – Very few people want to read thousands of words of nonstop text. Tell and show using customised tables, images, and rich text. Make your brand stand out with branded templates.

How to use a tender management tool

Tender management tools have multifaceted uses that benefit an entire organisation. A comprehensive content management system should be a single source of truth for two of your company’s greatest assets, its knowledge and essential documents.

At a higher level, tender management tools save time, improve bid quality, and increase company profits. A tender management platform is a sales enablement tool that benefits all revenue-generating departments.

And, when it’s time for the procurement department to do its thing, a tender management tool will help them create requests designed to fulfil all requirements.

How Responsive can help your tender management process

If you’re looking for a way to improve your organisation’s efficiency and win rates, Responsive is an excellent option. Our software is designed to increase collaboration and boost capacity while making tracking progress and managing deadlines easier. With Responsive, you’ll be able to spend less time on administrative tasks and more time developing winning proposals. Chat with us to see how Responsive can benefit your organisation.

Tender management FAQs

What is a tender?

A tender is a legal document that invites multiple parties to bid on a large purchase. A tender might also refer to the bids in response to the documents.

How is a tender different from an RFP?

The word “tender” is far more common outside the United States. Both documents ask for formalised purchasing proposals. Both terms can also refer to the proposals generated.

What is a request for tender (RFT)?

A request for tender is a request for a formalised business proposal.

What are the evaluation criteria for tenders?

Tenders have very stringent evaluation criteria. The winning bidder will have to provide the exact deliverables, security, and business requirements, and a price that fits the buyer’s budget.

How do I know if my tender has been successful?

Tender success can be measured by several metrics, including quality, response time, and of course, whether you win the bid. Tender management software should help you assess quality and response time. It can take weeks or months to learn whether you win the bid. However, customers may ask additional questions, which can indicate you’re on the shortlist.

Ready to see Responsive in action?

Find out why leading response teams across the world turn to Responsive for their Strategic Response Management and RFP software needs.

Learn More