Bid rule

For a professional services firm, the rule that says which proposals to pursue: bid where fees won per hour of pursuit in that cell of practice, source and fee band exceeds a stated floor; require a partner's written case where it does not. From the proposal log, engagement letters and pursuit-coded time entries.

DefinitionFor a professional services firm, the rule that says which proposals to pursue: bid where fees won per hour of pursuit in that cell of practice, source and fee band exceeds a stated floor; require a partner's written case where it does not. From the proposal log, engagement letters and pursuit-coded time entries.

Per cell, not overall

A thirty-four percent win rate describes no cell. Strategy tenders at five percent and existing clients at sixty-eight are the finding.

Needs a pursuit code

Without hours coded to proposals, the cost is spent and unmeasured.

How it is computed

Fees won divided by hours spent bidding, by source and size, from the proposal log and timesheets. The rule names the combinations below a stated return and says not to bid, or to bid only with a named sponsor.

Example

Invited proposals to existing clients win 55 percent and return $4,100 of fees per bid hour. Open tenders to strangers win 9 percent and return $350. The rule: no open tenders without a partner who knows the buyer.

Where it goes wrong

Win rate is watched and bid cost is not. A team can raise its win rate by bidding on small safe work and still lose money on pursuit.

Articles that use this term

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Cost to serve by industry: what the account costs beyond the goods, on twelve desks

Cost to serve is what it takes to serve an account beyond the product, and what that is differs by desk: drops and returns for a distributor, adviser hours for a wealth firm, support tickets for a SaaS company, pursuit hours for a consultancy, detention charges for a forwarder. This hub gives, for twelve industries, the cost components, the rate each is stated at, the source, and the measure it feeds, with the guide for each.

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Proposal win rate by practice and source: what a consulting firm should stop bidding on

How a consulting or advisory firm measures proposal win rate from its proposal log and engagement letters, by practice, by source, existing client, referral, competitive tender or cold, and by fee band, the cost of a proposal in hours from the time entries, the cost per win by cell, and the cells where the firm spends the most partner time for the least work.

16 Sept 20263 min read Board and management reporting · Consulting and advisory

Ten questions a consulting firm managing director asks, and the table that answers each

The ten questions the managing director of a consulting or advisory firm puts to the practice leads, which clients use one practice, will the sold work fit the bench, which consultants are busy and unprofitable, which proposals cost more than they win, whose book depends on one client, which fixed fees overran, which practices hire while their neighbours bench, what is realisation per client, which clients have gone quiet, and what changed, each with the table from the time entries, the proposal log, the roster and the bills, and the answer to send back.

16 Sept 20262 min read